Russian Tycoon Clashes with Britain Over North Sea Deal

Russian Tycoon Clashes with Britain Over North Sea Deal
Russian billionaire Mikhail Fridman says he will buy a number of gas licenses in the North Sea despite British opposition, threatening legal action if London should force him to sell them on to a third party.

Reuters

FRANKFURT/DUESSELDORF, March 2 (Reuters) - Russian billionaire Mikhail Fridman said on Monday he would buy a number of gas licenses in the North Sea despite British opposition, threatening legal action if London should force him to sell them on to a third party.

German utility RWE on Monday finalised the sale of its oil and gas production unit DEA to Fridman's investment vehicle LetterOne, ending months of uncertainty over whether the 5.1 billion euro ($5.7 billion) deal would go ahead.

The transaction, first announced a year ago, coincided with sanctions imposed on Russia for its actions in Ukraine, sparking concern in some EU countries about whether a European oil and gas business should fall into Russian hands.

Britain on Saturday said the deal's structure did not alleviate concerns that possible future sanctions against LetterOne's owners Fridman and his partner German Khan could negatively impact production.

"We are deeply disappointed and concerned by your letter, given the extensive efforts the parties have made to address your professed concerns," Jonathan Muir, chief executive officer of LetterOne Holdings S.A., said in a letter addressed to British Secretary of State for Energy and Climate Change Edward Davey.

LetterOne and RWE had sought to allay the concerns in January by offering to keep DEA's British assets separate for a number of years and committing RWE to buy them back should the EU or United States impose sanctions on LetterOne's owners within a year after the closing.

This week, LetterOne hired ex-CEO of oil major BP, John Browne, as executive chairman of LetterOne's energy division saying it wanted to use North Sea assets as a platform for a global expansion.


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