BP retains law firm for Russia venture fight
By Russell Hotten
Oil giant BP has begun marshalling its defences in the battle for control of TNK-BP by retaining the services of a leading Russian law firm.
The firm, Egorov, Puginsky, Afanasiev & Partners (EPA), was a regular adviser to former Russian president, Vladimir Putin, and includes Oleg Deripaska, one of the world’s richest men, as a client.
The move is a further indication of BP’s willingness to dig in for the long haul in the increasingly bitter battle with its partners in the oil joint venture. EPA has already advised BP on the employment contract of Robert Dudley, the TNK-BP chief executive who faces expulsion from Russia at the end of the month.
BP’s 50-50 partner in TNK-BP, a consortium called Alfa-Access-Renova (AAR), claims the employment contract has not been renewed and so Mr Dudley is not entitled to a work permit.
But BP executive vice president Lamar McKay said yesterday: “Bob Dudley has a valid employment contract and is therefore entitled under Russian law to a renewal of his work visa. Therefore we remain confident that, if the laws are properly applied, he will be given a new work visa.”
Yesterday, Mr Dudley’s visa was extended for another 10 days while the Federal Migration Service clarifies his status. A BP source added that even if Mr Dudley was forced out of Russia, “he would still be chief executive of TNK-BP.”
AAR – controlled by billionaires Mikhail Fridman, German Khan, Len Blavatnik and Viktor Vekselberg – is trying to oust Mr Dudley, accusing him of promoting BP’s interests in the venture, a claim that has been denied. Meanwhile, BP yesterday bought an onshore gas field in mainland America, paying $1.75bn (£875m) for natural gas assets in Oklahoma.
The deal is BP’s first major gamble on North America’s booming gas fields. It will work with Chesapeake Energy, a smaller independent company which knows how to produce gas from what are essentially unconventional reservoirs. Chesapeake produces about 50m cubic feet of gas a day – BP believes the site could produce double that.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/07/19/cnbp119.xml
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