KHANTY-MANSIISK — TNK-BP aims to sell its Kovykta gas field to the state by the end of 2010 and earn at least $700 million, bowing out of an ownership tug of war that sapped investor confidence.
Viktor Vekselberg, a billionaire TNK-BP shareholder, said Tuesday that the company planned to sell Kovykta to Rosneftegaz, a state holding company with stakes in Rosneft and Gazprom.
"The price range is between $700 million and $900 million," Vekselberg told reporters on a trip to western Siberia, where he was accompanying President Dmitry Medvedev and senior government officials.
"We plan this year to close the deal," said Vekselberg, one of the four businessmen who together own half of TNK-BP. Oil major BP owns the other 50 percent.
The decade-old dispute over Kovykta, a lucrative east Siberian field holding enough gas to meet world demand for eight months, spooked investors wary of the Kremlin's track record of expropriating assets from private business.
Russian officials have long argued that TNK-BP be stripped of Kovykta for failing to meet its license terms. The Federal Inspection Service for Natural Resources Use, an environmental watchdog, gave weight to this argument with its February ruling on the case.
Licensing policy is governed by another body, the Federal Subsoil Resource Use Agency, which has not spoken publicly about the fate of Kovykta.
TNK-BP argues that it cannot bring output to the levels stipulated by its license because state-run Gazprom has a monopoly on Russian gas exports, effectively closing the Chinese market to Kovykta's 2 trillion cubic meters of reserves.
Talks between TNK-BP and Gazprom over the sale of the assets have previously broken down as the companies were unable to agree on price. Vekselberg stressed on Tuesday that TNK-BP aimed to sell the field to Rosneftegaz, not Gazprom.
Rosneftegaz is the majority shareholder in Rosneft, Russia's largest oil producer, and also owns a stake of slightly more than 10 percent in Gazprom.
Kovykta's huge reserves place it in the strategic category, meaning that Gazprom could theoretically snap up the deposit free of charge should TNK-BP be stripped of its license.
The country's top energy official, Deputy Prime Minister Igor Sechin, said this month that TNK-BP should be compensated for the costs it has incurred developing Kovykta, assuring the market that there would be no "blatant expropriation" of the asset.
Sechin, who was among the officials accompanying Medvedev on the trip, said energy-saving efforts would allow Russia to save an annual 51 million metric tons of generic energy by 2015, Interfax reported.
Medvedev also ordered a Sechin-led commission on raw materials and the development of the energy sector to begin working on energy efficiency issues as well, the report said. (MT)
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