Rosneft CEO says BP remains a major player

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The company logo hangs at the PCK refinery, majority-owned by Russia’s Rosneft, in Schwedt, Brandenburg, Germany, June 9, 2022. ― Reuters pic

Saturday, June 18, 2022 4:27 PM MYT

MOSCOW, June 18 — Igor Sechin, head of Russian oil company Rosneft, said on Saturday that BP remained its largest private shareholder despite announcing his departure in February after Moscow sent troops to Ukraine.

Many Western companies, including oil majors, have left Russia since Moscow sent its armed forces to Ukraine on February 24.

Speaking at the St. Petersburg International Economic Forum, Sechin, a longtime ally of President Vladimir Putin, said BP still has stakes in large-scale Rosneft projects including Taas Yuriakh, Kharampurneftegaz and Yermak Neftegaz.

“All these actions show a desire to remain an active player in the Rosneft company and to wait out the disadvantageous geopolitical situation without real losses,” Sechin said. BP could not immediately be reached for comment on Saturday.

“The withdrawal announcement was unexpected for Rosneft and unfounded from the perspective of our companies’ successful 30-year partnership,” Sechin said.

He also said that BP had received $36 billion (RM159 billion) from its Russian operations since 2003, for a $10 billion investment.

BP said on February 27 that it was selling its 19.75% stake in Rosneft, ending three decades of partnership between the two companies and would take over up to $25 billion, without saying how it planned to s ‘get out.

At the time, Rosneft accounted for about half of BP’s oil and gas reserves and a third of its production.

BP received income from Rosneft in the form of dividends totaling around US$640 million in 2021, or around 3% of its overall operating cash flow.

Sechin said BP’s dividend would be transferred to special accounts, without further details. Russia has imposed capital controls and restricted cross-border transfers of foreign currency to deal with Ukraine-related sanctions.

Rosneft has promised to pay a record dividend of 41.66 rubles (RM3.4) per share on its 2021 results, or 50% of its net profit.

Speaking at the forum, Sechin also criticized the West for its sanctions policy, saying giving up Russian oil and gas would be “energy suicide” for Europe, mirroring Putin’s earlier comments.

He said the sanctions had effectively ended efforts to engineer a transition to green energy.

Sechin said the world faces a long-term oil deficit due to underinvestment and needs an additional $400 billion in investment by 2030 to close the gap.

However, he said the level of investment was unlikely to be reached and shortages could persist for a long time.

BP leaves Russia with up to US$25 billion after invading Ukraine. ― Reuters

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