BP seeks to revive Rosneft deal

June 7, 2011

, LONDON, June 7 – British energy group BP could sell part of its stake in Russian joint venture TNK-BP to revive an Arctic exploration deal with the Russian state oil company Rosneft, The Wall Street Journal said on Tuesday.

The newspaper, citing unnamed sources, said top BP executives had informed Russian billionaire shareholders in TNK-BP of the plan to sell part of its 50 percent stake to Rosneft.

A person close to BP told the paper there had been "no decision to sell any of BP\’s shares in TNK-BP." However The Wall Street Journal added that a formal announcement outlining the sale plan would be included in a letter that would shortly be sent to the billionaire shareholders.

Rosneft last month shattered BP\’s hopes of exploiting Russian Arctic oil by pulling out of a planned joint venture with the British giant after losing patience with protracted negotiations.

The deal — championed by Prime Minister Vladimir Putin — was hailed as a breakthrough in Russian business ties with the West and a chance for BP to restore its reputation after the Gulf of Mexico oil spill.

But it appears neither side expected objections from the group of Russian oligarchs who own half of TNK-BP. They argued that the deal breached their shareholder pact and blocked it in court.

BP and Rosneft sought to buy out the billionaires — known collectively as AAR — to end the crisis but the Russian firm tired of the conditions and price demands they set.

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