Robin Pagnamenta, Energy and Environment Editor
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The future of BP’s investment in Russia hung in the balance last night after Robert Dudley, the chief executive of TNK-BP, decided to leave the country.
In a humiliating defeat for Britain’s largest company, BP’s chief executive, Tony Hayward, said that Mr Dudley had left Russia temporarily, after an intense campaign of harassment by TNK-BP’s Russian co-owners, Alfa, Access and Renova (AAR), that had been “deeply unpleasant” for Mr Dudley and left him unable to carry out his job. Mr Dudley’s departure from Moscow was not disclosed until he was in the air en route to an undisclosed location.
Mr Hayward expressed full support for Mr Dudley, describing him as an outstanding CEO, and insisted that the company would use “every means at its disposal that remains well within the law” to resist AAR’s efforts to seize management control of TNK-BP.
He said that BP intended to pursue legal action to recover any and all losses suffered by BP as a result of breaches of a shareholder agreement signed between AAR and BP at the formation of the group as a 50-50 joint venture in 2003. He said: “AAR wants to tear up the agreement they made with us. We are not going to be intimidated by their strong-arm tactics.”
Despite BP’s insistence that Mr Dudley could run TNK-BP from outside Russia, the decision to pull out has compounded the impression that AAR has gained the upper hand in its battle for control of the group, Russia’s third-largest producer of crude oil.
A statement last night from Mikhail Fridman, one of the four Russian oligarchs who control AAR, said that it was a ridiculous notion to suggest that Mr Dudley could run the company “by remote control from London”. He said: “This approach demonstrates that BP is without question running TNK-BP as a subsidiary.”
Peter Sutherland, BP’s chairman, said that AAR had orchestrated “a campaign of harassment” to gain control of TNK-BP. “There has even been manipulation of elements of the Russian state as part of this campaign,” he said.
Lord Robertson of Port Ellen, the former Nato Secretary-General and TNK-BP deputy chairman, was outraged at AAR’s actions. “AAR’s efforts to wrest control through illegitimate means are damaging the company and, regrettably, Russia’s reputation among international investors,” he said.
BP stopped short of criticising the Russian Government directly. “I don’t believe that we are in a dispute with the Russian state,” Mr Hayward said.
TNK-BP has suffered raids by Russian government agencies, including the federal migration service, which last week refused Mr Dudley a new annual visa, granting him only a transit visa that expires on Sunday. Mr Dudley said he was leaving because of uncertainties over his work visa “and the sustained harassment of the company and myself”.
TNK-BP is a critical part of the British oil group’s global business. It pumps 1.4 million barrels of crude per day – of which BP’s half-share represents a quarter of its global output – and has 8.2 billion barrels of proven reserves, representing 20 per cent of BP’s total. BP has relied on TNK-BP for growth, and in 2006, the company obtained three-quarters of its new reserves from Russia.
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