BP Raises Stakes in Its Russian Energy Gamble
BP could obtain 20% of its global oil and gas production this year from Russia as it pushes ahead with a heavier than expected capital expenditure. About $1.3bn (£720m) has been earmarked for investment by the 50%-owned TNK-BP venture, which is hoping to ramp up output by 12%...
BP could obtain 20% of its global oil and gas production this year from Russia as it pushes ahead with a heavier than expected capital expenditure.
About $1.3bn (£720m) has been earmarked for investment by the 50%-owned TNK-BP venture, which is hoping to ramp up output by 12%.
The new figures come as the Russian president, Vladimir Putin, threatens higher taxes on oil companies as part of a crackdown on oligarchs.
TNK-BP is considering establishing a new company in Moscow that would sit between its holding group registered in the British Virgin Islands and its 400 operating subsidiaries.
A spokesman for BP said this would be an attempt to simplify the structure of its opera tions in Russia and had "nothing to do with taxes" which were - he confirmed - expected to rise.
TNK-BP is primed to produce 1.5m barrels of oil equivalents a day in 2004 giving the British side of the business 750,000 barrels - about 20% of BP's total global output if the non-Russian contribution remains flat, as is likely.
The oil company had previously talked of investing more than $1bn but now plans to spend about $700m on production upgrades and a further $600m on exploration and marketing.
The latest figures showing the commitment resulting from its $7.7bn investments in TNK and Sibneft last year came to light as BP signed final financing for a controversial pipeline project in another part of the former Soviet Union.
The $3bn Baku-Tbilisi to Ceyhan pipeline will bring oil from new fields in the Caspian Sea to tankers on the Black Sea but has attracted a welter of criticism.
It passes through areas of special environmental importance and its operators have demanded strict legal rights, which critics say undermine local democracy, a charge rejected by BP and the funders, which include the Royal Bank of Scotland (RBS).
RBS, which owns NatWest, was accused by environmentalists and human rights groups yesterday of breaking its own guidelines on project finance which it signed up to as part of the equator principles, an agreement on environmental and social impacts.
But the bank said this was not the case and it had backing from an independent environmental consultant and the British government.
About $1.3bn (£720m) has been earmarked for investment by the 50%-owned TNK-BP venture, which is hoping to ramp up output by 12%.
The new figures come as the Russian president, Vladimir Putin, threatens higher taxes on oil companies as part of a crackdown on oligarchs.
TNK-BP is considering establishing a new company in Moscow that would sit between its holding group registered in the British Virgin Islands and its 400 operating subsidiaries.
A spokesman for BP said this would be an attempt to simplify the structure of its opera tions in Russia and had "nothing to do with taxes" which were - he confirmed - expected to rise.
TNK-BP is primed to produce 1.5m barrels of oil equivalents a day in 2004 giving the British side of the business 750,000 barrels - about 20% of BP's total global output if the non-Russian contribution remains flat, as is likely.
The oil company had previously talked of investing more than $1bn but now plans to spend about $700m on production upgrades and a further $600m on exploration and marketing.
The latest figures showing the commitment resulting from its $7.7bn investments in TNK and Sibneft last year came to light as BP signed final financing for a controversial pipeline project in another part of the former Soviet Union.
The $3bn Baku-Tbilisi to Ceyhan pipeline will bring oil from new fields in the Caspian Sea to tankers on the Black Sea but has attracted a welter of criticism.
It passes through areas of special environmental importance and its operators have demanded strict legal rights, which critics say undermine local democracy, a charge rejected by BP and the funders, which include the Royal Bank of Scotland (RBS).
RBS, which owns NatWest, was accused by environmentalists and human rights groups yesterday of breaking its own guidelines on project finance which it signed up to as part of the equator principles, an agreement on environmental and social impacts.
But the bank said this was not the case and it had backing from an independent environmental consultant and the British government.
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