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Rosneft to acquire BP's stake in TNK-BP

23rd November 2012

Rosneft signs definitive agreements to acquire BP’s 50 per cent stake in TNK-BP

Rosneft to acquire BP's stake in TNK-BP
Rosneft is also in advanced negotiations with the AAR consortium for a definitive agreement to acquire AAR’s 50 per cent interest in TNK-BP

State-owned Russian oil and gas major Rosneft has announced that it has entered into definitive agreements with BP for the purchase of BP’s 50 per cent interest in TNK-BP, Russia’s third largest oil producer, in exchange for USD 17.1 bn and a 12.84 per cent stake in Rosneft shares.

In addition, BP has entered into an agreement to purchase from Rosneft’s parent, Rosneftegaz, a further 600 million Rosneft shares, representing a 5.66 per cent stake in Rosneft.

On completion of the above transactions, BP will hold a 19.75 per cent stake in Rosneft, inclusive of its existing 1.25 per cent interest. The completion is subject to regulatory approvals, and is expected to occur in the first half of 2013.

“This has been a serious prospect for BP for a while,” a spokesperson for BP told OGT. “Our Russian venture has had its fair amount of difficulties,” the spokesperson added in reference to disagreements between BP management and its AAR counterpart about how TNK-BP should be run.

Rosneft is also in advanced negotiations with the AAR consortium (Alfa Group, Access Industries and Renova) for a definitive agreement to acquire AAR’s 50 per cent interest in TNK-BP. If successful in acquiring both BP’s and AAR’s stake in TNK-BP, the country’s third largest oil company will now be owned by the Russian government.

TNK-BP has five refineries, four in Russia and one in Ukraine. Its 2011 production registered 1.99 million barrels of oil equivalent per day.

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