BP has announced an “historic” agreement with the Russian government in a £10 billion deal which will open up unexplored reserves in the Arctic.
The “groundbreaking” global alliance will see the UK oil giant own 9.5% of Russian government-owned Rosneft’s shares, while Rosneft will take a 5% stake in BP.
Speaking at the signing ceremony in central London, BP chief executive Bob Dudley said: “I do believe this is a historic moment for BP, for our industry and I believe for Russia and the wider world of energy globally.”
He continued: “We are building a relationship between BP and Rosneft that has been forged over 12 years but going far beyond anything that has gone before. We are creating an entirely new strategic alliance between what I know are two great companies.
“Vladimir Putin, the Russian prime minister, told us in our meeting in Moscow it is an alliance based on mutual advantage and recognition of the great strengths that bring each of us together in our co-operation.”
He confirmed the deal will see the Russians take an eight billion US dollar (£5 billion) stake in BP as part of a 16 billion US dollars (£10 billion) share exchange.
The move suggests BP now intends to focus more towards interests in the east, following a torrid year in North America. But Mr Dudley denied BP was “turning to the east” in the wake of the Gulf of Mexico disaster. The oil spill which followed the explosion on the Deepwater Horizon rig killed 11 workers and cost the company tens of billions of pounds.
Energy Secretary Chris Huhne said the Government welcomed the new partnership. He said: “It is a groundbreaking deal. It is good news for Europe, for the UK, energy security and worldwide.”
He said after the events of last year, this showed that BP was “very much open for business”.
Igor Sechin, Russia’s deputy prime minister and chairman of Rosneft, said: “Global capital and Russian companies are clearly ready to invest in world class projects in Russia; and Russian companies are quickly emerging at the forefront of the global energy industry.”