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BP offices raided after losing Arctic deal with Russia

Marketplace Staff Aug 31, 2011

BP offices raided after losing Arctic deal with Russia

Marketplace Staff Aug 31, 2011

Steve Chiotakis: In Moscow today,
court officials raided BP’s offices looking for information in a lawsuit where a shareholder claims his interests were harmed after Russia awarded a lucrative Arctic oil exploration deal to ExxonMobil instead.

Mikhail Krutikhin is a Russian energy analyst with the Moscow-based consultants Rusenergy. He’s with us live from Moscow. Hi there, Mikhail.

Mikhail Krutikhin: Hello, yes, I am in Moscow right now.

Chiotakis: The raid on BP comes just as the British oil giant lost out to ExxonMobil on that Arcitc deal. Is the timing significant here?

Krutikhin: Well, I don’t think so because basically the raid was caused by the Russian partners of BP and its TNK-BP company. They have some problems with the Anglo-American giant.

Chiotakis: How important is that ExxonMobil deal that Russia gave?

Krutikhin: It will be clear in about 2 years in the Black Sea when they drill the first well and see whether there are excellent reserves underground. And it will take about 5 years to understand whether reserves exist in Arctic waters of Rosneft. Before that, it’s anyone’s guess.

Chiotakis: Rosneft, of course, is the Russian oil firm. How much oil is in the Russian Arctic territory do you think?

Krutikhin: Well they believe that there is mostly gas, and it’s about one third of Russia’s total reserves. But it’s mainly hypothetical, because in many cases there have not been any wells drilled in the area. It is only speculative reserves, but not proven.

Chiotakis: Do we see other joint ventures between Russian and Western firms coming down the pike, do you think?

Krutikhin: Yes, I think it is possible. But you must understand that according to Russian laws, Rosneft cannot offer more than 33 percent in any joint venture on the continental shelf and Gazprom can offer absolutely nothing because it is already 51 percent state-owned and Russian oil offshore projects should belong 51 percent of the state.

Chiotakis: Mikhail Krutikhin with Rusenergy joining us from Mowcow. Thank you, sir.

Krutikhin: You’re welcome.

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