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British shareholders at TNK-BP reiterated their trust in and backing
British shareholders at TNK-BP reiterated their trust in and backing for Robert Dudley, the company's president and CEO, the British Petroleum press secretary said Friday.

"BP's position on Bob Dudley has not changed in any way - we continue to have absolute confidence in him in his position as CEO and President of TNK-BP," the press secretary said.

Russia's consortium AlfaAccessRenova (AAR), a co-owner of the joint oil venture TNK-BP, is demanding that Dudley step down accusing him of putting the interests of BP first.

"CEO Robert Dudley should resign as in AAR's opinion, Robert Dudley is managing the company in the interests of only one shareholder, namely BP," an AAR statement said.

The BP press secretary also said: "Throughout his time in the post Bob Dudley has consistently operated in the best interests of ALL TNK-BP shareholders and the first class record of TNK-BP under his leadership - growth in production, reserves, investment and tax revenues - is solid evidence of that."

Founded in 2003, the Russian-British venture TNK-BP, Russia's third-largest oil producer, is jointly owned by BP and AAR. The consortium, representing Russian investors Alfa Group, Access Industries and Renova (AAR), holds 50% in the energy company.

Dudley was appointed president and CEO in 2003, when the JV was set up.

The Financial Times reported Friday that BP chief executive Tony Hayward and TNK-BP's Russian shareholders, Mikhail Fridman, Viktor Vekselberg and Leonard Blavatnik held informal talks in Cyprus on Thursday.

The Russian shareholders boycotted a board meeting in Cyprus on Thursday, after BP backed Dudley's position at TNK-BP. But the consortium stressed that the shareholder disagreement would not affect company operations.

"Of course, we regularly meet with our partners and expect to continue to do so. We continue to believe that differences between shareholders should be settled by negotiation between the shareholders and not interfere with the management of the company," the BP spokesman said.

The Russian investors were also unhappy over comments made by Dudley in an interview with Russia's business daily Vedomosti on Monday, which they called "deeply incorrect" and said the issue should not move into the public domain.

In the interview, Dudley discussed disagreements over Russian shareholders' plans for international expansion, and BP's belief that TNK-BP should focus on Russia. Dudley said the company's aim was to keep oil production as high as possible, and any change in management could lead to a production drop.

Russian shareholders in TNK-BP want to expand into Turkmenistan, Kazakhstan and Venezuela, where TNK-BP has a competitive advantage. BP has resisted the idea, as well as plans to take part in high-risk projects in countries including Iraq, Uganda, Syria and Libya.

Earlier this week business daily Kommersant said the Russian shareholders were seeking to replace Dudley with Russian tycoon and TNK-BP's executive director Viktor Vekselberg.

The Russian-British oil venture has come under intense pressure from the Russian authorities this year. In March the Federal Security Service raided the company's headquarters and the Moscow office of BP, and carried out new searches at BP last week. In March a TNK-BP employee was arrested on suspicion of industrial espionage.

Analysts say the ongoing dispute between Russian and British shareholders could lead to the company being bought up by a Russian state giant, most likely Gazprom but possibly Rosneft.


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