BP Chair Blasts Russian Partners
BP has branded its Russian oligarch partners "corporate raiders", and warned Dmitry Medvedev, the country's new President, that the fate of its TNK-BP joint venture is a test of his ability to restore the rule of law.
The statements from Peter Sutherland, the UK oil major's chairman, at a Stockholm conference yesterday followed the launch of two separate lawsuits by the billionaire-backed Alfa-Access-Renova (AAR) investor vehicle. The claims, made in separate suits in Sweden and one in Russia, concern the way the joint venture is run.
The dispute is not about TNK-BP's foreign management, the competence of the BP-backed chief executive, or the group's overseas expansion plans, Mr Sutherland said. It is a fight for control and, ultimately, ownership of the company. "This is just a return to the corporate raiding activities that were prevalent in Russia in the 1990s," Mr Sutherland said. "Prime Minister Putin has referred to these tactics as relics of the 1990s, but unfortunately our partners continue to use them. The leaders of the country seem unwilling or unable to step in and stop them. This is bad for us, bad for the company and, of course, very bad for Russia."
BP and AAR each own 50 per cent of TNK-BP, which accounts for a quarter of the UK giant's output and a fifth of its proved reserves. The wrangling started when a lock-in agreement expired in December, and rapidly turned into a corporate soap opera, complete with security service raids, visa problems and foreign staff banned from working.
AAR has been consistent in its demands for more weight in the boardroom. The group is pushing for the company to cut the number of BP employees contracted to TNK-BP, and has openly called for the resignation of Robert Dudley, the chief executive, for acting exclusively in BP's interests. But the group denies any involvement in pressures brought to bear on TNK-BP's foreign staff, including, this week, Mr Dudley being called in to the Kremlin's Interior Ministry in relation to a probe into labour practices.
Mr Sutherland said: "President Medvedev has spoken eloquently in the early weeks of his administration about legal nihilism in Russia and the need to restore respect for and the rule of law," he said. "The fate of TNK-BP will be an early test of the ability of President Medvedev to turn his vision into reality. We of course have a great interest in his success, but he must also be aware that much of the world is watching as well."
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.
- Uber Victim Stepped Suddenly in Front of Self-Driving Car
- Cambridge Analytica's Board Suspends CEO Nix Amid Inquiry
- How Facebook Made Its Cambridge Analytica Data Crisis Even Worse
- Facebook Sued by Investors Over Voter-Profile Harvesting
- Apple Is Secretly Developing Its Own Screens for the First Time