BP’s relationship with the co-owners of its TNK-BP joint venture has been put under more strain after the Alfa Access-Renova consortium of Russian billionaires voted against a proposed £637million dividend.
Directors representing AAR said the dividend was not prudent, putting further pressure on BP to resolve conflict and ownership issues at the UK-Russian oil venture.
The British oil major and its oligarch partners jointly own the TNK-BP venture, but are heading for divorce after BP put its 50% stake up for sale last month.
AAR chief executive Stan Polovets said: “At a time of continuing market uncertainty and while corporate governance at TNK-BP remains strained, we believe that a cautious stance by shareholders is called for.
“A payment now of an additional dividend is not prudent.”
Chris Weaver, chief strategist at Troika Dialog investment bank, said the dividend decision “is just keeping pressure on the (ownership) situation . . . so that everyone stays focused on getting a resolution as quickly as possible.”
He added AAR’s decision put pressure in particular on BP, which will need to explain the situation to investors when reporting its second-quarter results today.
TNK-BP International said last week its second-quarter net profits slumped to £515million from £1.4billion a year ago, amid lower crude prices and higher taxes. Market insiders have said the corporate spat has also had an impact on its operations.
Russian oil giant Rosneft has come forward as a potential buyer for BP’s half of TNK-BP, which has been valued by analysts at up to £20billion. BP’s efforts to sell its stake come after one of the AAR billionaires, Mikhail Fridman, resigned as chief executive of the joint venture, citing a breakdown in relations with the UK giant.
TNK-BP accounted for more than one-quarter of BP’s production and 90% of its 2011 dividend.
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