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BP, TNK-BP in talks to solve Russia oil row

Moscow, July 31, 2008

BP chief executive Tony Hayward met billionaire TNK-BP shareholder Mikhail Fridman in London on Wednesday to discuss a dispute over the Russian oil venture, sources close to both shareholders said on Thursday.

’Fridman met Hayward in London yesterday. It sounds like there was some positive movement,’ a source close to TNK-BP’s Russia-connected shareholders told Reuters.

A source close to BP also said the meeting had taken place. TNK-BP declined to comment, while a spokesman for BP in London said dialogue had taken place in recent months but declined to confirm a meeting had occurred on Wednesday.

Hayward this week told investors the consortium of four Russia-connected billionaires led by Fridman wanted to tear up the shareholder agreement concluded at the founding of the company in 2003, a charge his partners rejected.

The 50-50 joint venture, Russia’s third-largest oil producer, remained under pressure at home as a Siberian court on Thursday upheld a challenge to a list of management nominees to the board of its main operating unit, TNK-BP Holding.

The court ruled that TNK-BP management, led by BP-nominated chief executive Robert Dudley, had acted illegally by drawing up a list of nominees to the unit’s board, a spokeswoman for the court and a TNK-BP spokesman said.

The court ruling did not specify why it was illegal. BP’s partners in TNK-BP have said the list of nominees was not legitimate because management failed to agree it with them.

But the board itself is operating legally, TNK-BP executive vice-president for legal affairs Igor Maidannik said.

’The court has said the decision to form the list was illegal, but it does not mean that the current board of directors is illegal, as it was elected by the annual shareholders’ meeting,’ said Maidannik.

Dudley left Russia last Thursday after failing to renew his visa, citing a campaign of harassment against him and his company.

On Wednesday he made his first public statement since his departure from Russia to announce that TNK-BP’s board would reconsider its 2008 capital spending plan. BP’s partners had demanded spending be cut by $900 million.-Reuters




Tags: TNK-BP | oil news |

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