New hurdle for BP-Rosneft deal

10th February 2011, Comments 0 comments

A contested tie-up between BP and Russian counterpart Rosneft hit a new hurdle Thursday when an arbitration tribunal extended an injunction on the deal until a fresh hearing next month.

The injunction was taken out by Russian shareholders in TNK-BP Holding, concerned that the deal will hit their own interests.

Rosneft's partnership with BP -- personally blessed by Prime Minister Vladimir Putin -- last month saw the two firms found a joint venture for Arctic exploration and take a cross-holding.

The BP deal delighted the Russian market with analysts seeing it as a springboard for Rosneft to become a global oil giant and a landmark moment in Russia's economic relations with the West.

But it has raised questions over the future of TNK-BP which is jointly owned 50 percent by the British oil giant and 50 percent by a consortium of three Russian businessmen.

Last week The High Court in London granted a request by the Russian shareholders -- known as Alfa Access Renova (AAR) -- to halt the BP-Rosneft deal after they complained it violated the TNK-BP shareholder agreement.

That injunction blocked any further progress on the landmark deal until February 25.

On Thursday the arbitration tribunal pushed that deadline back further, ordering that "a final hearing on certain matters to be agreed will take place in the week commencing 7 March 2011," BP said in a statement.

Therefore "the injunction which has put on hold the Rosneft transaction announced on 14 January has been extended by the tribunal pending the outcome of this arbitration hearing."

A BP spokesman said it was impossible to make further comment, given the legal process.

© 2011 AFP

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