BP’s Russian partners say ‘nyet’ to $1.8-bn dividend payout
01 Feb 2011
Oil giant BP's Russian partners in the 50:50 joint venture TNK-BP yesterday said they would block a $1.8 billion dividend payment in what is being seen as an attempt to abort BPs tie-up bid with rival oil group Rosneft.
The dramatic move by the AAR consortium of billionaires, which owns the other half of TNK-BP, is expected to overshadow the fourth-quarter results to be announced by the British company today. The company is expected to return to profits and announce dividends after the catastrophic Gulf of Mexico spill last year.
The moves come even as AAR seeks a court injunction today against BP's proposed $16-billion JV with Russian rival Rosneft. The state-owned Rosneft and BP are expected to enter into a deal on a proposed Arctic exploration.
Its partner's move on blocking dividend could mean BP would have to give the miss to a $900-million payout that was due for distribution in February. According to Stan Polovets, chief executive of AAR, the decision for now was not to approve the dividend. He spoke after a board meeting today.
According to some analysts, the impact of AAR's move would be marginal. They say BP's own Q4 dividend decision was not likely to be affected with the group chief executive Bob Dudley expected to restore the payout at about 7 cents a share.
Analysts believe BP would return to dividend, because, despite the Gulf spill, its finances were strong, with $22 billion of assets already sold, and oil nearing $100 a barrel.
