BP's Russian partners set to back rival CEO

Click to follow
The Independent Online

The oil major BP is squaring up for another battle over the management of its TNK-BP venture, after its Russian partners yesterday proposed an alternative to BP's candidate for running Russia's No. 3 oil producer.

The quartet of Russia-connected billionaires who own half of TNK-BP also plan to appoint an interim chief executive from within their own ranks to run the company for up to six months, sources close to both shareholder groups told Reuters.

"I think a new person from AAR will be appointed for three to six months as a temporary chief executive and that this will be fair. Last time, it was a BP person," said a source close to AAR, or Alfa-Access-Renova, which represents the Russian group.

A quarrel between BP and the Russia-connected shareholders last year led to the departure of many expatriate TNK-BP staff, including then chief executive Robert Dudley, and raised concerns among foreign investors about doing business in Russia.

Though both sides say they have resolved their differences, the appearance of a second candidate to replace current chief executive Tim Summers – whose contract expires on 1 June – suggests tough negotiations lie ahead.

BP said on Monday "the search for a new CEO is over" after it nominated Pavel Skitovich, a former employee of the billionaire Vladimir Potanin and one-time Soviet diplomat, to the post.

But two sources said on Tuesday that a second candidate was in the running. Maxim Barsky, 35, is a board member at the oil firm West Siberian Resources and has previously worked at the investment bank Troika Dialog and a Gazprom unit.

"It's possible that, within the course of six months, we will choose a new CEO from two people: Barsky or Skitovich," the source close to AAR, speaking on condition of anonymity, said.

Mr Barsky, reached by telephone, declined to comment. Mr Skitovich also declined to comment on Monday.

BP retains the right to nominate a chief executive for TNK-BP, but the Russia-connected shareholders have insisted the candidate be a Russian speaker with experience in the country.

An investor in BP, who declined to be named, said an impasse between the shareholders on the appointment of a new chief executive would be a major concern for investors. "It's a big, important asset, and certainly it's unsettling," he said.

The source close to AAR said shareholders would decide at a board meeting this week on whom to appoint as temporary chief executive when Mr Summers' contract expires. Extending the contract was an option, he said, although he thought it unlikely.

Russian newspaper Vedomosti reported on Monday that Viktor Vekselberg, one of the Russia-connected partners and a 12.5 percent shareholder in TNK-BP, was a candidate for interim CEO. The source did not confirm his candidacy.

He said Skitovich would join TNK-BP in a senior position. Of his candidacy for the CEO post, he said: "Skitovich is a very talented manager and we welcome his move to the company. But he doesn't yet have enough experience in the oil sector."

Mr Barsky, who was previously CEO of Stockholm-listed West Siberian Resources, has more direct experience in the sector.

Mr Skitovich, then an employee of Potanin's Interros group, was chief executive of Polyus Gold for five months in 2007 as Potanin wrestled for control of Russia's largest gold miner with his erstwhile partner, Mikhail Prokhorov.

When Mr Prokhorov returned as Polyus's chairman, Mr Skitovich left.

Additional reporting by Tom Bergin in London

Comments