BP's Russian tie-up draws criticism from environment groups
17 January 2011
BP's deal with the Russian energy group Rosneft is likely to provoke a rift between the British oil giant and its partners in its existing Russian joint venture, TNK-BP.
According to Alfa-Access-Renova (AAR), a consortium of Russian billionaires who own the other 50 per cent of TNK-BP, under a clause in their joint venture AAR and BP are required to pursue all opportunities in Russia exclusively through TNK-BP. AAR officials say they have therefore the right to veto BP's deal with Rosneft.
BP's move has also drawn criticism in the UK with Labour leader Ed Miliband and environmental campaigners saying the deal, which gives BP access to huge oilfields in Russia's Arctic waters, was "worrying", since it comes at a time when the company was trying to recover from the Deepwater Horizon explosion, which killed 11 people and caused the Gulf of Mexico oil spill leading to the worst environmental disaster in US history.
"I'd be pretty worried about this," Miliband told the BBC's Andrew Marr Show. "I think the lesson of the Deepwater Horizon, the Gulf oil spill, should be that … the task for all of us, private companies, and government and so on, is not to just keep digging and digging deeper and deeper for oil. It is actually to find those alternative forms of energy that can help us move forward in a clean way."
BP and Rosneft entered into a ''strategic global alliance" on Friday under which the two companies would exchange expertise to explore Russia's Arctic region covering about 125,000 square kilometres near the South Kara sea. The two companies would also swap 5 per cent of BP shares for 9.5 per cent of Rosneft.
Environmentalists are focusing attention on the Arctic region, which they fear could suffer extensive damage with large scale oil exploration and opening up of the region to trade shipping routes.