BP directors at TNK-BP, the Russian joint venture between Europe's second-largest oil company and oligarch investors, voted to block TNK-BP from joining BP's partnership with OAO Rosneft, Russia's largest oil company, that will see the two oil giants work together to explore for oil in the Russian area of the Arctic Circle.
The move is seen as prolonging a dispute between TNK-BP, Russia's third-largest oil producer and BP (BP) which started following BP's proposed $16 billion share swap with Rosneft that was announced earlier this year. TNK-BP claimed the BP/Rosneft deal violates TNK-BP's shareholder rights agreement with BP.
''A proposal by BP's nominated directors which would have allowed TNK-BP to hold initial discussions with Rosneft about pursuing the Arctic opportunity, was rejected by Alfa, Access and Renova (AAR),'' according to a statement issued by BP. A source close to the board said the shareholder agreement also bars BP from moving forward with the Rosneft deal on its own because it voted against TNK-BP's participation, the Financial Times reported.
TNK-BP accounts for 25% of BP's output and 20% of its reserves. BP has said it would like to resolve the dispute with TNK-BP as the relationship between the two firms has become increasingly frayed in recent weeks.