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March 31, 2022

BP in deliberations with state-owned energy majors to divest Russian assets

The decision to exit Russia may cost the British energy major as much as $25bn.

Understand the impact of the Ukraine conflict from a cross-sector perspective with the Global Data Executive Briefing: Ukraine Conflict

BP has reached out to state-backed firms in Asia and the Middle East to offload its Russian assets in response to Moscow’s military aggression against Ukraine, Bloomberg News has reported, citing people familiar with the development.

The British oil giant has made ‘preliminary approaches’ to Sinopec Group and China National Petroleum for the nearly 20% stake in Russian state-owned oil firm Rosneft PJSC.

In February, BP said the exit from Rosneft would cost it as much as $25bn by the end of the first quarter of this year.

BP has also ‘selectively reached out’ to undisclosed potential buyers in the Middle East, the report added.

The company is also assessing interest from potential Indian firms, such as the Indian Oil Corp. and Oil & Natural Gas Corp., for its stakes in some oil and gas projects in Russia.

Last month, Bloomberg News reported that the British oil and gas giant could reach a deal with Rosneft to either sell the stake at a huge discount, or transfer it back.

Bloomberg News reported this month that China is looking to increase stakes or buy Russian energy and commodities companies.

Amid the Russia-Ukraine crisis, Poland plans to stop using oil and gas from Russia by the end of 2022, Polish Prime Minister Mateusz Morawiecki said.

Morawiecki has also urged the European Union to introduce a tax on Russian hydrocarbons, reported Reuters.

Poland imports more than 60% of the oil it refines, and 50% of its gas, from Russia.

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