BP is considering selling its half-share of Russia’s third-largest oil producer TNK-BP.
The UK oil major said it had received “unsolicited approaches” and has notified its partners – a group of four Soviet-born billionaires known as Alfa Access Renova (AAR) – that it plans to pursue a potential sale.
Reuters later reported that a Russian state-owned oil and gas group is one of the parties that made a bid approach, according to a source close to the matter.
BP has squabbled for years with its partners, though pulling out would have a big impact on its production and earnings.
Just days before the announcement, one of the billionaires, Mikhail Fridman, resigned as chief executive of TNK-BP, citing a breakdown in relations with BP.
BP sources said they believed the move was a tactic to force the company to buy out AAR’s stake in the venture.
BP formed TNK-BP with AAR in 2003 to expand into Russia, one of the few major resource-holders where foreign oil companies could invest.
It has been a huge financial success for BP, yielding billions of dollars more in dividends than it invested in buying its interest. However, it has been a bumpy ride.
BP and AAR have been at loggerheads since BP sought to reach an offshore exploration and share-swap deal with Rosneft last year.
AAR won a court order to block the agreement, and last May refused a buyout offer from Rosneft and BP for its one-half interest in TNK-BP.
Arbitration proceedings continue under UK law into whether the failed BP-Rosneft deal violated an exclusivity clause in the TNK-BP shareholder agreement, with further hearings expected to be held towards the end of this year.