BP share-swap blocked by tribunal

BP's £10 billion share-swap with Russian government-owned Rosneft was dealt another blow today after a tribunal blocked the deal until further notice.







The Stockholm tribunal has extended an injunction blocking the swap as it determines whether the deal breaches agreements with its existing Russian partners TNK-BP.



The oil giant currently has until April 14 to complete the deal - which would see BP own 9.5% of Rosneft's shares, while the Russian group would have taken a 5% stake in BP - but plans to discuss extending this deadline with Rosneft.



The embattled supermajor has come to blows with TNK-BP shareholders, a group of Russian oligarchs known as Alfa-Access-Renova, who said BP was obliged to pursue new projects in Russia with TNK-BP.



The setback comes less than a week before BP's annual general meeting, when investors are likely to hit out at the company's safety record following the Gulf of Mexico oil disaster last year, its bonus policy and strategy in Russia.









The deal - hailed by BP as "historic" and "groundbreaking" when unveiled in January - would have paved the way for BP and Rosneft to jointly explore the south Kara Sea in the Russian Arctic.



But last month the tribunal extended its injunction on the whole deal to both the exploration and share-swap. BP then requested for the share-swap to proceed alone but this was also blocked today.



Both the share-swap and Arctic exploration remain under injunction until the final decision has been made by the tribunal.



BP is able to ask for Rosneft's consent to extend the cut-off date for the deal to keep the agreement alive.



Rosneft chairman Igor Sechin has previously said he is "satisfied" with BP as a partner, despite the ongoing dispute.



AAR said the deal had harmed BP's reputation in Russia.



Stan Polovets, chief executive officer of AAR, said today: "AAR welcomes the decision of the tribunal, which we consider fair, balanced and thoughtful.



"We will be pleased to continue to co-operate with the tribunal and will provide any additional information and evidence it requires during the next stage of the hearings."



The finding will come as a blow to new chief executive Bob Dudley as the company moves to restore its reputation and financial position in the wake of the Deepwater Horizon explosion.



Mr Dudley will have to face shareholders' ire at the company's AGM on Thursday, where some are expected to vote against the annual report and accounts.



The Association of British Insurers has given an "amber top" alert to the remuneration report, while Christian groups including the UK's Church Investor Group are advising voting against the report.



Shareholders are also likely to question Mr Dudley over the deteriorating deal with Rosneft.



The deal tie-up would have helped BP replace lost production from the Gulf of Mexico and other assets sold off in the wake of the Deepwater Horizon explosion.



The company recently posted a loss of 4.9 billion US dollars (£3.1 billion) in the year to December 31 - its first loss in nearly two decades - after the cost of the disaster was taken into account. The company pledged to sell up to 30 billion US dollars (£18 billion) of assets to meet compensation requirements.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Software Development Manager

£40000 - £50000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Product Manager - (Product Marketing, Financial Services)

£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee