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TNK-BP boss fined £10 as row rumbles on

TNK-BP boss fined £10 as row rumbles on

By Russell Hotten, Industry Editor

Last Updated: 10:13pm BST 08/08/2008



Robert Dudley, the chief executive of oil venture TNK-BP who went into hiding after claiming a campaign of harassment against him, has one more thing to worry about – a £10.50 fine for allegedly breaching Russian labour laws.

Mr Dudley has been caught in a bureaucratic nightmare as part of an extraordinary power struggle between the joint venture’s partners, UK oil giant BP and a group of Russian billionaires.

Yesterday, a Moscow court fined him 500 roubles for violating Article 19.5, Clause 1, of Russia’s labour code demanding “the correction of infringements” regarding the employment of foreign staff.

Mr Dudley escaped a potential three-year ban from working in Moscow for breaching the code, although this may not come as much relief because he fled Russia last month without leaving a forwarding address.

The chief executive, with BP’s backing, is attempting to run TNK-BP remotely from a secret location in central Europe while the two sides thrash out a resolution.

BP claims that its TNK-BP partners, a consortium called Alfa-Access-Renova (AAR), have been using low-level contacts in the Russian state to help orchestrate a campaign to undermine Mr Dudley. AAR categorically denies the accusation.

In recent months, TNK-BP’s offices have been raided by police and foreign staff have had visas denied. The company has been hit by back-tax claims and an obscure investment company started legal action against the joint venture.

TNK-BP became virtually ungovernable as management was tied up in bureaucratic knots over issues like the labour code, a problem that will now be resolved by paying what amounts to the cost of a couple of bottles of vodka.

There was a further sign yesterday that the dispute has hit investor confidence in TNK-BP, Russia’s third-largest oil producer.

Fitch became the third major ratings agency to downgrade its outlook for the company, putting it on “negative watch”, saying it was “concerned about the impact of the dispute on TNK-BP’s ability to remain on track with the development of its new fields, both in terms of investments and implementation. “

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