Directors at BP’s fractious Russian joint venture have approved a $1.25bn special dividend for the first half of this year, as the company seeks to move on from a damaging shareholder dispute.
Agreement on the pay-out was taken at a board meeting of TNK-BP in Cyprus on Friday at which Tony Hayward, BP’s former chief executive, formally resigned as a non-executive director after less than a year in the post.
Mr Hayward joined the board of TNK-BP as a non-executive last October after his departure from BP but his position was always only seen as a temporary one until his own plans became clearer. He has since launched Vallares, an investment vehicle, to buy assets in the Middle East with a focus on Kurdistan. BP is understood to have already identified several internal candidates to succeed Mr Hayward on the TNK-BP board.
Agreement on the dividend – of which BP will receive half in cash – comes after a strong operational performance from the joint venture in the first six months of the year. Payment of the special dividend requires the approval of both BP and its Russian partners. The regular dividend is 40 per cent of net income and is paid automatically.
The board also approved the acquisition of a 45 per cent stake in Petra Energia, a Brazilian explorer. TNK-BP, which was unavailable for comment, is expected to confirm the decisions from the meeting as early as Monday.
The venture’s strong performance comes amid continuing tension between its shareholders over BP’s attempt to team up with Rosneft, the Russian state oil group, earlier this year. The proposed alliance to explore in the Arctic alongside a $16bn share swap foundered after opposition from BP’s Russian billionaire partners in TNK-BP who hold their stake through the Alfa-Access-Renova (AAR) group.
AAR has asked for an arbitration tribunal to rule whether BP broke the venture’s shareholder agreement when it tried to strike the Rosneft alliance. The agreement grants TNK-BP first right of refusal to any new energy deals in Russia or Ukraine.
Rosneft has since agreed an Arctic exploration alliance with ExxonMobil, the US group. BP is also being sued by minority shareholders in TNK-BP over the collapse of the alliance. The shareholders doubled their claim for damages from BP to $4.9bn last week. BP, which is asking that the case be dismissed, has described the claims as “absurd” and “groundless” because no losses were incurred by TNK-BP.
Analysts have said both the AAR arbitration and the lawsuit filed by the minority shareholders appear to be part of a process of maintaining pressure on BP.
Industry watchers believe the feud could end in an attempt by one of the shareholder parties – either BP or AAR – buying out the other from the 50:50 joint venture.
