MOSCOW (Dow Jones Newswires), Apr. 8, 2011
An arbitral tribunal has ruled that an injunction prohibiting a share swap between BP and Russia's Rosneft will remain in place until further notice, but allowed the U.K. oil major to discuss the extension of an April 14 deadline with the Russian company, BP said Friday.
A Stockholm tribunal last month said BP and Rosneft wouldn't be allowed to proceed with their strategic tie-up, which includes a $16 billion share swap and joint exploration of three licenses in Russia's Arctic Kara Sea, ruling in favor of BP's billionaire oligarch partners in TNK-BP, who say BP must pursue all business opportunities in Russia through the joint venture.
Despite the ruling, BP sought a determination from the Stockholm arbitrators as to whether the share swap element of the agreement could proceed on its own.
"The arbitral tribunal has ruled that the interim injunction prohibiting closing of the share swap transaction with Rosneft will remain in place until further notice," BP said in a statement.
BP's Russian partners in TNK-BP--a group of Soviet-born businessmen known as the Alfa-Access-Renova consortium, or AAR--welcomed the ruling, saying the tribunal had asked BP and AAR to submit additional evidence to review the share swap.
"AAR welcomes the decision of the tribunal, which we consider fair, balanced and thoughtful," a spokesman said.
BP is working under pressure in Russia, as an exclusivity agreement to close the proposed share swap and exploration deal with Rosneft expires April 14. The tribunal, however, allowed BP to discuss with Rosneft an extension of that deadline.
A BP spokesman said the company is still considering its options, while a Rosneft spokesman said it hasn't received a formal offer from BP to extend the deadline.
People familiar with the situation Thursday said BP has asked for the TNK-BP board to be assembled early next week in case the arbitration ruling would required immediate action. But one person close to BP said it may take several days before BP and Rosneft would be able to agree on an extension of the ruling.
BP wants to proceed with the share swap and may seek to do the Arctic exploration deal through TNK-BP, one person familiar with the situation said. Last month, BP directors voted against the joint venture's involvement in the project at a TNK-BP board meeting.
Copyright (c) 2011 Dow Jones & Company, Inc.
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