Rosneft Could Pursue BP Stake Exclusive Of Arctic Partnership

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OAO Rosneft, Russia's largest oil company, would be open to pursuing its $16 billion share exchange with BP, Europe's second-largest oil company, and find a new a partner for the Arctic drilling venture that BP hopes to be part of if a court permits the British oil giant to split the two aspects of the deal.

In January BP and Rosneft announced what has become a controversial and difficult-to-execute share exchange that would see the Russian company take a 5% stake in BP (BP) for $7.8 billion. The two companies would then partner to explore three blocks of the oil-rich Russian area of the Arctic Circle.

The deal looked to be dying a slow death after TNK-BP, BP's joint Russian venture with oligarch investors, moved to block it, claiming it violated the venture's shareholder rights agreement with BP. The deadline for BP and Rosneft to finalize their pact was April 14, but the two companies announced they have extended that to May 16.

Alexander Shokhin, a TNK-BP board member, made the comments that Rosneft would be willing to move forward with the share swap while finding another partner for the Arctic alliance, according to Bloomberg News.

He said Rosneft could replace BP with either Exxon Mobil (XOM) or Royal Dutch Shell (RDS-A). Exxon and Shell, the largest U.S. and European oil companies, respectively, have frequently been mentioned as possible replacements for BP should Rosneft choose to move forward in the Arctic without the British company.