{"id":942,"date":"2011-03-28T18:56:09","date_gmt":"2011-03-28T17:56:09","guid":{"rendered":"https:\/\/www.desertsun.co.uk\/blog\/?p=942"},"modified":"2011-03-28T20:42:04","modified_gmt":"2011-03-28T19:42:04","slug":"business-as-usual-part-ii","status":"publish","type":"post","link":"http:\/\/www.desertsun.co.uk\/blog\/942\/","title":{"rendered":"Business as Usual Part II"},"content":{"rendered":"

It’s good to see that following the Macondo well blowout last year, BP have taken all necessary steps to ensure they don’t lurch into yet another embarassing\u00a0 crisis<\/a>:<\/p>\n

UK supermajor BP and Russian giant Rosneft have been blocked by an arbitration panel from forming an alliance to explore for oil in the Russian Arctic and executing a $16 billion share swap.<\/p>\n

The ruling, by an arbitration tribunal in Stockholm today, handed a major victory to BP’s billionaire partners in its Russian venture, TNK-BP. They argued that the deal between BP and state-controlled Rosneft violated their right of refusal on deals in Russia enshrined in TNK-BP’s shareholder agreement.<\/p>\n

…<\/p>\n

It will especially sting BP chief executive Bob Dudley, who was once in charge of TNK-BP before being forced to leave Russia in 2008 due to what he described as a campaign of harassment by the joint venture’s co-owners.<\/p><\/blockquote>\n

Recall that they sacked Tony Hayward for incompetence and making an idiot of himself in public.\u00a0 I wonder what the BP management think this is?<\/p>\n

Perhaps Bob Dudley is\u00a0 hoping the problem will just go away, as Igor Sechin<\/a> appears to be:<\/p>\n

Russia’s Rosneft vowed today to push ahead with a strategic alliance with BP, despite a block on the deal by the UK supermajor\u2019s partners in joint venture TNK-BP.<\/p>\n

Rosneft chairman Igor Sechin said an arbitration panel ruling preventing BP and the state-controlled energy giant from jointly exploring Russia’s Arctic region and from executing a $16 billion share swap did not void the deal.<\/p>\n

…<\/p>\n

“The court didn’t block (the deal), it extended the injunction until 7 April. We must await the court’s verdict,” said Sechin, who is also Russia\u2019s deputy prime minister.<\/p><\/blockquote>\n

This might come as somewhat of a surprise to Mr Sechin, but the tribunal is unlikely to be interested in his personal interpretation of the ruling.\u00a0 Unlike in Russia, such rulings are not merely handed down for information only.<\/p>\n

Meanwhile<\/a>:<\/p>\n

US giant Chevron and Russian state-owned oil company Rosneft are looking at whether to go ahead with a $32 billion Black Sea oil exploration project, with the proposed deal currently mired in uncertainty, sources at the companies said today.<\/p><\/blockquote>\n

If the oil and gas journals are ever looking to save money they might consider informing us only when Russian projects are not<\/em> mired in uncertainty.\u00a0 Nobody seems to have a clue what to do with Kovykta: the Russian government first tried to snaffle<\/a> it from TNK-BP before pulling out<\/a> of a deal to take it over declaring they have no use for the gas, then saying they will delay<\/a> its development before buying<\/a> the field and subsequently announcing<\/a> that sending its gas to China will be a priority. (Incidentally, Kovykta is one of the hardest subjects I write about: trying to make head or tail of all the u-turns, announcements, contradictions and actual events is a nightmare.)\u00a0 Shtokman has stalled following an 11th hour change of strategy<\/a> on the part of Gazprom, rumours abound that Sakhalin II is going to become wholly Gazprom-owned with Shell being granted access to another development in return (although perhaps they should decide once and for all if they’re going to build a 3rd LNG train, baby steps and all that), and the Russian government recently threatened<\/a> to replace ExxonMobil on Sakhalin I in the midst of arguments over the project budget (yes, the same Sakhalin I project which was told it couldn’t export the gas it was entitled to under the terms of the PSA).\u00a0 On this basis, the confusion over the BP-Rosneft deal is business as usual.<\/p>\n

Back to the article:<\/p>\n

Industry analysts said there were differences between Chevron and Rosneft on the choice of a project contractor, where the joint venture should be domiciled, and on the jurisdiction of arbitration for any business disputes.<\/p><\/blockquote>\n

Pretty major differences those, all pointing in the direction of Chevron not trusting Rosneft one jot.\u00a0 I expect Chevron want disputes to be settled in the courts of a neutral country whilst Rosneft want them to be settled in Russia, specfically Igor Sechin’s office.\u00a0 If they can’t even agree basics such as this, this can be chalked up as yet another Russian oil and gas project which has fallen at the first hurdle.\u00a0 No doubt Russia’s cheerleaders will ascribe this to strategic brilliance on the part of Russia’s leadership who have shrewdly predicted an oversupply of Black Sea oil in the next decade.\u00a0 Indeed, the Russians are already getting their version of events out:<\/p>\n

Russian media reported Chevron was sceptical about the prospects of Val Shatskogo and that it feared the deposit did not hold enough crude to be commercially viable.<\/p><\/blockquote>\n

Not being commercially viable and not being commercially viable in Russia being two entirely separate things.\u00a0 There’s a pattern here, isn’t there?<\/p>\n","protected":false},"excerpt":{"rendered":"

It’s good to see that following the Macondo well blowout last year, BP have taken all necessary steps to ensure they don’t lurch into yet another embarassing\u00a0 crisis: UK supermajor BP and Russian giant Rosneft have been blocked by an … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[7,3],"tags":[],"_links":{"self":[{"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/posts\/942"}],"collection":[{"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=942"}],"version-history":[{"count":5,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/posts\/942\/revisions"}],"predecessor-version":[{"id":947,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/posts\/942\/revisions\/947"}],"wp:attachment":[{"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=942"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=942"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.desertsun.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=942"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}