Russian Oligarchs Agree $28 Bln TNK-BP Stake Sale

The Russian oligarchs whose joint venture with BP has been plagued by years of in-fighting have reached preliminary agreement on a deal to sell their stake to state-owned oil giant Rosneft for about $28 billion, Sky News reported on Wednesday, citing its sources.

“AAR, a consortium of four oligarchs (Len Blavatnik, Mikhail Fridman, German Khan and Viktor Vekselberg), owns 50 percent of TNK-BP. They are understood to have signed an outline agreement with Rosneft in Moscow last night,” the TV channel said.

October 17 is the deadline for the expiry of “good faith” talks between BP and AAR on a possible repurchase of the British oil major’s stake in the joint venture in accordance with the existing shareholders’ agreement.

The oligarchs’ decision, which is not final and could be reversed, potentially offers BP a significant boost as it tries to extricate itself from its conflict-ridden but lucrative alliance with AAR.

“As well as ensuring a final separation from their fractious partners, a deal valued at $28bn would be higher than many analysts’ estimates and would represent a significant financial boost to BP if it too could agree such a lucrative sale to Rosneft,” the TV channel said.

BP, which is currently holding talks both with AAR and Russian state-controlled oil company Rosneft on a possible sale of its stake estimated by analysts at $25 billion, announced its decision to quit TNK-BP, which accounts for a quarter of the British oil giant’s global production and almost a fifth of its reserves, in June 2012 after a long-standing row with the Russian billionaire shareholders that cost BP some of its control over the company.

Rosneft and AAR did not reply to RIA Novosti when contacted on Wednesday afternoon.

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