Royal Dutch Shell Group .com Rotating Header Image

BP withdraws last of seconded staff from Russia

Times Online
July 23, 2008

BP withdraws last of seconded staff from Russia

BP has conceded a fresh defeat in its struggle for control of TNK-BP, its Russian joint venture, saying that it would withdraw the last of its seconded staff from Moscow.

The company said that 60 of its technical specialists who had been working on a temporary basis for TNK-BP were being pulled out of Russia with immediate effect. A spokesman said that they would start to leave this week as soon as the necessary practical arrangements could be made.

The decision follows the departure of 88 seconded staff over the past month after a dispute over their work permits. BP said that a further 49 permanent, foreign staff of TNK-BP – many of whom formerly worked for BP – will remain in Russia, although there are still questions over the status of Robert Dudley, the company’s chief executive, and one other junior member of staff.

Lamar McKay, BP’s executive vice-president, said that the decision to pull out the company’s remaining secondees, who include geologists and petroleum engineers from a range of countries including Britain, had been taken reluctantly.

Mr McKay said: “These technical experts have played a huge part in making TNK-BP one of Russia’s most successful oil companies in the past few years. Since it was formed in August 2003, the company’s oil output has grown by an annual average of 5.8 per cent. It has also paid some $70 billion in taxes and duties as well as $20 billion in dividends to its shareholders.”

BP described their redeployment as purely a “business decision”, citing a global shortage of skilled people in the oil and gas industry. It added that they would be transferred to a range of other projects where there was a demand for their skills in areas such as Azerbaijan, the Middle East and the Gulf of Mexico.

BP said that the specialists had been unable to provide services to TNK-BP since March because of visa complications. It said that once this problem had been dealt with, they had been prevented from returning to their duties by security staff in TNK-BP and subsequently by a court injunction. The injunction was lifted, but BP said that there was no indication that such attempts to interfere with BP’s ability to deliver technical support would end soon.

BP, which has owned 50 per cent of TNK-BP since 2003, has been locked in a fierce battle for control of the company with its co-owner the AAR consortium, which represents four Russian billionaires.

AAR has claimed that TNK-BP’s foreign secondees are a waste of money and has argued that they should be employed as permanent staff or replaced by Russians. AAR is also trying to dislodge Mr Dudley from his position as chief executive.

Stan Polovets, the chief executive of AAR, said that he respected BP’s decision to withdraw its secondees. He said: “The BP secondees have not been working for TNK-BP for many months now and the company’s operations have not been hampered in any way.”

AAR, which BP has accused of corporate raiding of the kind that was widespread in Russia during the 1990s, appeared to have scored a tactical victory yesterday after TNK-BP announced an unexpected deal with Venezuela. The deal comes after months of a fierce dispute between the two sides about expansion abroad.

BP wants TNK-BP, Russia’s third-largest crude producer, to focus on domestic production, while AAR has been pushing to pursue a variety of international opportunities.

http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article4380910.ece

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

Comments are closed.

%d bloggers like this: