TNK-BP boss leaves Russia after dispute with partners

BP has been forced to concede more ground in the acrimonious dispute with its Russian joint venture partners, announcing yesterday that it has recalled Robert Dudley, chief executive of its TNK-BP business, from Moscow. Mr Dudley, who will continue to serve as TNK's chief executive, has been forced to quit Russia after failing to resolve a dispute with the authorities over his work permit and visa.

The withdrawal of Mr Dudley is a bitter pill to swallow for BP, which believes the TNK boss is the victim of a campaign being managed by the oligarchs who control Alfa, Access and Renova (AAR), the Russian investors which have a 50 per cent stake in the business.

Peter Sutherland, BP's chairman, accused the Russian authorities of conniving with AAR. "Nowhere in our recent history have we been treated as we are currently being treated in Russia where our fellow shareholders [AAR] have been orchestrating a campaign of harassment in order to gain control of our joint venture TNK-BP," he said. "There has even been manipulation of the Russian state as part of this campaign."

Tony Hayward, BP's chief executive, added: "BP will use all means at its disposal, both inside and outside of Russia, to defend its interests and rights as a 50 per cent shareholder in TNK-BP."

However, a spokesman for AAR said that, while it has been campaigning for Mr Dudley's sacking in the belief that he has not run the company in the interests of all shareholders, it had nothing to do with his dispute with Russia's Federal Migration Service (FMS).

The FMS had given Mr Dudley until Sunday to produce a valid contract from TNK in order to renew his work permit; but while BP insists his paperwork is in order, the authorities have refused to accept it. AAR argues that Mr Dudley does not have a contract that has been signed off by all shareholders.

Mikhail Fridman, AAR's representative on TNK's board, said he would continue to campaign for Mr Dudley's resignation. "It a ridiculous notion to suggest that the company can be run by remote control," he said. "This approach demonstrates that BP is without question running TNK-BP as a subsidiary."

BP declined to comment on where Mr Dudley would now base himself, though, as an American citizen, he may choose to return to the US. Mr Dudley said he had been left with no choice but to leave Russia, but that he hoped to return. "The uncertainty which has been created by the transit visa that I now have creates acutely unstable working conditions for me and a distraction to the TNK-BP group," he said.

To add to BP's woes, the oil giant suffered a second reverse in Russia yesterday, with a Siberian court ruling that it had received illegal payments from TNK-BP. The dispute centres on 150 technical consultants seconded from BP to TNK-BP over the past five years, for whom BP has received payments from its Russian unit. The Siberian court upheld the case of a shareholder which has complained that these payments were an unlawful special dividend.

BP said it was considering whether to appeal against the ruling and it has in any case already withdrawn all the staff from Russia. But it could now face demands that it repay the fees TNK-BP has paid for their services in the past.

The oil giant continues to insist that it will not sell its holding in TNK-BP.