Here is my latest article published in IBA Global Insight:
In January, BP and state-owned Russian energy company Rosneft shocked the world by signing a US$16bn share swap deal. The two companies intend to jointly exploit oil and gas reserves in Russia’s Arctic shelf and make Rosneft the largest single shareholder in BP. The deal, which will also see BP increase its holdings in the former assets of Yukos oil company, occurred only a matter of weeks after Yukos’ former CEO, Mikhail Khodorkovsky, was sentenced to a further six years in prison.
A stark reminder of BP’s recent past also came shortly after, when the company reported a loss of US$4.9bn – mainly due to US$40.9bn for charges relating to the Gulf of Mexico oil spill – making 2010 its first year of losses for 20 years. The tie-up therefore not only raises many questions about the viability of a British – Russian exploration operation, but also poses questions about the future of BP and the oil and gas industry as a whole.
Published on 04-04-11. Read on here