Oligarchs in oil grab as BP chief expelled
Robert Dudley forced to leave Russia after campaign of “harassment” by authorities
British oil giant BP was dealt a devastating blow last night after Robert Dudley, boss of its TNK-BP joint venture, was forced to leave Russia.
Dudley, a key BP ally in its long-standing battle with its four oligarch partners, lashed out at the Russian authorities, accusing them of “sustained harassment” which culminated in him and many of his non-Russian colleagues being denied a work visa.
The news is a dramatic confirmation that the oligarchs – Mikhail Fridman, Viktor Vekselberg, Len Blavatnik and German Khan – are winning their longstanding battle with the British firm.
The Russian partners, who hold their oil interests in the holding firm AAR, want Dudley replaced because they say he only represents BP’s interests and won’t expand into potentially lucrative investments aboard. BP denies this.
Dudley’s departure – which was kept under wraps until he was safely on a plane out of the country – came days before Russian authorities were due to decide whether to grant him a new visa after his work contract expired in December. AAR refused to renew it.
He said: “In the light of uncertainties surrounding the status of my work visa and the sustained harassment of the company, I have decided to leave and to work outside Russia temporarily.”
Dudley said he still leads TNK-BP – which accounts for a quarter of BP profits and produces 1.8 million barrels a day – and that he will manage the operation from an unnamed country.
But TNK-BP chairman Mikhail Fridman said yesterday: “This approach demonstrates that BP is without question running TNK-BP as a subsidiary. The employees and shareholders at TNK-BP deserve hands-on, present, and visible leadership of the company. Robert Dudley has proposed a long distance relationship that is doomed to fail.”
BP reacted angrily to the ousting of Dudley. The chief executive of Europe’s second largest oil firm Tony Hayward said he still backed Dudley as head of the joint venture that was formed in 2003.
Hayward 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. This will include bringing arbitration proceedings against AAR to recover any and all losses suffered by BP as a result of their violations of the terms of our shareholder agreement”. TNK-BP deputy chairman Lord Robertson said: “AAR’s efforts to wrest control of the company through illegitimate means are damaging the company and, regrettably, Russia’s reputation among international investors.”
Observers say the moves come as the Kremlin prepares to take a controlling stake in the firm, which is the third largest oil business in Russia.