TNK-BP deal makes Rosneft world's biggest oil producer

Now Reading:

TNK-BP deal makes Rosneft world's biggest oil producer

Text size Aa Aa

Russian state oil company, Rosneft, has closed a 43-billion-euro deal making it the world’s largest oil producer.

That represents a victory for the company’s chief executive Igor Sechin, a close confidant of Russian President Vladimir Putin, and sees the government tighten its grip on the energy sector.

It is the biggest deal in Russia’s corporate history.

TNK-BP was created in 2003 by a merger of BP’s Russian operations with those of the Alfa-Access-Renova (AAR) consortium of four Soviet-born billionaires.

BP will also take a near 20 percent stake in Rosneft along with the much-needed hard cash.

It has promised some of the money to shareholders and can set the rest against its multi-billion-euro Gulf of Mexico liabilities.

Rosneft will now produce 4.6 million barrels of oil equivalent per day, overtaking Exxon Mobil, the world’s No.1 investor-owned company.