China is looking at a stake in one of Russia’s top oil companies TNK – BP. This is after British shareholder – BP – opened up a bid for its key energy asset in Russia, saying it was ready to quit the consortium and sell its stake.
China's two biggest oil companies, Sinopec and the China National Offshore Oil Corporation (CNOOC) may buy out BP from its Russian venture TNK-BP, the British media reports. This would be a good way for the world’s second biggest producer and consumer of energy to make sure it gets enough resources, the media added.The Asian tiger alone consumes 10% of the world’s primary energy, just behind the US in terms of production and consumption volumes.BP shook the market on Friday, saying it received approaches for its stake in TNK – BP, though not specifying the names.According to Stan Polovets, AAR Chief Executive, the Russian shareholders approached their British partner a month ago, offering to buy out its share with cash.Reuters reports other potential candidates include Russian state energy holding Rosneftegaz, which controls more than 75% of Rosneft, Russia's largest oil company. Should BP agree to sell its stake to the Russian state, it’ll mean the Government controls more than 50% of total Russian oil production. The British company paid $8 billion to buy half of TNK-BP in 2003, and currently its stake is worth about $30 billion, according to the estimates by the Square Mile experts.“…taking the assets out of the joint enterprise will give the British company more freedom of action, strategic alternative,” according to Cristine Transcero, an analyst at Standard & Poor’s. The talk is of projects in the South Atlantics, Iraq, Libya and the shelf of the Caspian Sea, as well as the Brazilian oil company Petrobras and the Angolan state oil company Sonangol.BP’s shareholders will also benefit from the sale, as they would get up to $15 billion, The Sunday Telegraph calculates. “The company will invest a half of the money rescued into new projects, while the other – to repay investors,” one of the 10 biggest BP shareholders told the media. The news comes a day before Russia’s President Vladimir Putin makes its first visit to Asia under his new Kremlin mandate. Energy issues will be important during three – day trip. This is when Beijing is seeking to get more Russian oil, and Moscow is looking for big new markets.TNK-BP is owned equally by British Petroleum (BP) and Alfa Access Renova (AAR). The company was formed in 2003 as the result of the merger of BP’s Russian oil and gas assets and the oil and gas assets of AAR.