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BP says raid is pressure on its operations in Russia

posted 31 Aug 2011, 10:50 by Mpelembe   [ updated 31 Aug 2011, 10:53 ]

BP's Russia President Jeremy Huck says his office raid by Russian bailiffs is part of a pressure campaign aimed at his company in Russia.

MOSCOW, RUSSIA (AUGUST 31, 2011) REUTERS - BP Russia President Jeremy Huck said that the raid on his company offices in Moscow on Wednesday (August 31) was part of a pressure campaign aimed at the British company.

Russian bailiffs raided the Moscow trading offices of BP, causing new problems for the oil company a day after ExxonMobil signed a deal with Rosneft, that ended BP's hopes of developing Arctic offshore oil fields with Russia.

The morning raid, in which about 15 black-clad special force officers entered the central Moscow headquarters of BP Trading and sealed it off, was part of a legal battle being waged over BP's failed attempt to partner Russia in the Arctic.

A BP source said that employees were ordered to leave the office and work from home and only senior company officials and lawyers remained in the building with the bailiffs.

A spokeswoman for the bailiffs said they were looking for documents to use in the case in which minority shareholders in TNK-BP, BP's Russian joint venture, have sued BP over its failed Arctic alliance with state-owned Rosneft .

BP said it was cooperating with the Russian authorities. The raid highlighted BP's problems in Russia since it fell out with the authorities this year over a deal with Rosneft that would have allowed it to explore the same fields that U.S. rival ExxonMobil will now have the chance to develop.

However, BP's Russia chief Jeremy Huck said the raid on its Moscow office by court bailiffs on Wednesday was an attempt to put pressure on its business in Russia.

"In our view, this search has no legal merit. BP EOC is an operating company and is not a defendant in the case in Tyumen that Andrey Prokhorov has brought," he told Russia Today, the English language television channel.

"Our office's work is paralysed. None of the employees are in the office today and are unlikely to be in the office for the rest of the week, so we can only see these actions as being part of a pressure campaign against BP's business in Russia," Huck added.

Andrey Prokhorov had filed a petition to the Arbitration Court of the Tyumen Region on May 4, Russian newspapers Kommersant and Vedomosti reported, claiming $5 - $10 billion damages for TNK-BP following BP's tie-up with state-run Rosneft for an Arctic exploration project.

The petitions were filed days before BP agreed to cede its role in the Arctic pact to TNK-BP, bowing to the demands of a group of billionaire shareholders who had fought a court battle to get a slice of the deal.

Tuesday's pact gives Exxon access to potentially substantial reserves in Russia, the world's top oil producer. Rosneft gained by being able to bring in one of the few companies capable of drilling in the harsh, deep waters of the Arctic.

The deal was a big blow for BP, ending its chances of salvaging its own agreement with Rosneft. That agreement collapsed shortly after it was announced in January following objections from TNK-BP shareholders who also prevented a parallel $16 billion share swap deal between BP and Rosneft going ahead.

Alfa-Access-Renova (AAR), the consortium that represents the shareholders, objected to the BP-Rosneft pact, saying that BP was obliged to pursue all its Russian ventures through TNK-BP.They say they suffered big losses when the venture collapsed.

Wednesday's raid was not the first time BP has been subjected to such treatment in Russia. security forces searched BP's headquarters in Moscow in 2008 during a corporate standoff at TNK-BP which resulted in TNK-BP boss Bob Dudley, who is now CEO of BP, being forced out of Russia.