BP avoids suit from Russia partner

24th October 2011, Comments 0 comments

BP's Russia joint venture on Monday decided against joining a multi-billion-dollar suit against two directors of the British giant over its failed tie-up with state-held Rosneft.

BP Russia spokesman Vladimir Buyanov said the nine-member board of TNK-BP "voted against joining the suit against the directors." He did not provide a breakdown of the votes.

The decision takes some pressure off BP's Russian operations and provides an important boost to morale in one of its most profitable foreign partnerships.

The Russian half of TNK-BP is comprised of four Soviet-born tycoons who successfully argued in court that they held the right of first refusal on an Arctic oil exploration deal that Rosneft initially signed with BP in January.

The legal battle ended with Rosneft ripping up that agreement and signing a new pact with the US super-major ExxonMobil.

But the Russian half of TNK-BP still wants a Stockholm panel to recognise that BP's negotiations with Rosneft broke the joint venture's shareholder agreement.

One of the Russian executives also proposed this month that TNK-BP join a tiny group of shareholders' 87-billion-ruble ($2.8-billion) claim against BP executives Peter Charow and Richard Scott Sloan.

That motion was voted down Monday but another claim against BP and its local venture Russian Investments Ltd was filed by minority shareholder Andrei Prokhorov and was raised earlier this month to 409 billion rubles ($13.1 billion).

TNK-BP provides BP with about a quarter of its annual production and 10 percent of its profits.

© 2011 AFP

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