Sechin faults BP for failed Rosneft pact

Russia’s deputy prime minister has criticised BP for failing to win the agreement of its partners in its existing oil venture, TNK-BP, for its aborted co-operation pact with Rosneft.

Igor Sechin, speaking as Rosneft shareholders formally elected his replacement as chairman of the state oil group, said BP would have to improve its offer if it was to stand any chance of reviving its pact for developing vast offshore fields in the Arctic.

“BP should have ensured agreement with its partners and this was not done. We don’t know anything of their corporate agreements. They took the responsibility for agreeing all this and they didn’t do it. This was their responsibility, and the ball is in their court,” he said on Friday.

The proposed $16bn share swap and Arctic exploration pact foundered last month in the face of stiff resistance from BP’s Russian billionaire partners in TNK-BP, who claimed it breached their shareholder agreement with the UK oil group.

Bob Dudley, BP’s chief executive, this week said the company was now “moving on” with little chance of the deal being revived.

The collapse of the deal has prompted critics to wonder whether Mr Dudley misread the changing political winds in Russia as Mr Sechin, who had been a major architect of the deal as former chairman of Rosneft, came under political pressure ahead of presidential elections.

The backing of Mr Sechin, a leading member of a clan of powerful security service officials, had been believed to be key in ensuring the pact went ahead.

But he was forced to step down from his position as Rosneft chairman in April after Dmitry Medvedev, the Russian president, ordered government ministers to step down from their positions on the boards of state companies, in a move seen as chiefly targeted at Mr Sechin.

Rosneft shareholders attending the company’s annual meeting on Friday voted to retain Alexander Nekipelov, a high-profile Russian academic, as his replacement as chairman.

However, critics said the appointment showed the limits of Mr Medvedev’s reform drive and would do little to improve corporate governance at Rosneft.

Mr Nekipelov, who also serves as a vice-president at the Russian Academy of Science, is believed to have close connections to Mr Sechin.

In what could be a further blow for the company, Eduard Khudainatov, the Rosneft president, said Chevron was likely to exit a $1bn drilling venture in the Black Sea with the state oil group.

Mr Khudainatov said Rosneft did not intend to sue BP for the collapse of the proposed Arctic deal and would continue its search for other partners.