Russian Anti-trust Watchdog Greenlights BP’s Investment in Rosneft Subsidiary

Russia’s Federal Antimonopoly Service (FAS) approved the request by oil and gas giant BP to purchase a 49% stake in Kharampurneftegaz, a subsidiary of Russian state-owned company Rosneft, the regulator said according to TASS news agency.

Earlier, BP’s application was approved by the antitrust watchdog of Germany.

The Chief Executive Officer of the international oil and gas major Robert Dudley said in January that BP expects to close a deal on the acquisition of a stake in Kharampurneftegaz in 2018.

“I hope soon, maybe this year, I mean finalizing [the deal],” Dudley said, speaking on the sidelines of the World Economic Forum in Davos. The top manager did not detail the amount of BP investments into the project, referring to an early stage of the deal, but noted that it is “significant.”

It was reported earlier that Rosneft and BP agreed to establish a joint venture with Kharampurneftegaz base to develop Kharampurskoe and Festivalnoe fields in the Yamal-Nenets Autonomous District.

Currently, state-owned oil company Rosneft owns Kharampurneftegaz via RN-Gaz company, which unites the gas assets of Rosneft. In the future joint venture, Rosneft will hold 51% and BP will have 49%.

Total reserves of Kharampurskoe and Festivalnoe fields are estimated at 880 bln cubic meters of gas. Rosneft and BP plan to produce 11 bln cubic meters of gas at the first stage. Rosneft said it will offer the produced gas on the domestic market.