TNK-BP dispute leaves no approved 2008 investment program, nor interim dividend

The Moscow Times

MOSCOW — A boardroom war between BP and its four Russian partners over their troubled joint venture TNK-BP has left the company without an approved 2008 investment program or an interim dividend, two sources with direct knowledge of the matter said Monday.

TNK-BP has been the subject of a battle between BP and its four billionaire partners over management, strategy and control for the past year.

The affair has turned into a major international issue after accusations that the Russian side is using state resources, such as the police, courts and tax service, to put pressure on BP.

One source said the 10-person board meeting of holding company TNK-BP Ltd. in Cyprus last week was deadlocked on all the main issues on the agenda and that the firm's investment plan for 2008 and its interim 2008 dividend payout were not agreed on.

"It was a kind of stylized corporate war," the source said. "Each side vetoed the other's resolutions."

Underlining the increasingly bizarre dispute, TNK-BP's senior managers attended by videoconference from Moscow because problems in renewing visas made them worry that if they left Russia, they might not be allowed back.

— July 15, 2008