Moscow : Oil major BP's Russian venture, TNK-BP, is forcing its subsidiary with control of the huge Kovykta gas field into bankruptcy, TNK-BP said yesterday as its talks to sell the field to Russian state are stalled.
RUSIA Petroleum, which controls Kovykta and whose management is loyal to TNK-BP, said it could not repay its loans and filed a petition to the local arbitration court of the Irkutsk region to initiate bankruptcy.
Withdrawal
"TNK-BP announced its original decision to withdraw from the Kovykta project back in 2007," it said in a statement.
"As the major shareholder and creditor of RUSIA Petroleum, TNK-BP is determined to recover its investments and minimise its financial losses."
Kovykta, which TNK-BP has controlled for about 15 years, had been meant to supply China before Moscow started asserting control over natural resources and made its gas behemoth Gazprom a gas export monopoly.
Russian officials have repeatedly threatened to withdraw the Kovykta licence from TNK-BP for low production volumes.
BP and its partners have argued that output targets for Kovykta set by the Russian government became overly ambitious after the Chinese supply plan was banned because Russian industry does not require much gas.
TNK-BP agreed to sell Kovykta to Gazprom for around $1 billion (Dh3.67 billion) to cover its investment costs but the deal has never been finalised as Gazprom's finances became stretched because of the financial crisis and unclear prospects of gas exports to China.
Diversify
Russia is keen to diversify its gas exports away from Europe where demand for its gas has plunged amid increased rivalry with liquefied and spot gas.
However, Moscow's attempts to speed up its decade-long talks with China have been unsuccessful so far due to pricing differences.
