State-controlled oil major Rosneft denied it was in talks to buy out the Russian partners in TNK-BP in a deal that would, on paper, create the world's top listed oil group with output of 3 million barrels per day.
Chief Executive Eduard Khudainatov, unveiling a 64 percent gain in 2010 earnings, said on Friday no talks were under way with TNK-BP's co-owners, who have won a court order blocking a major offshore deal between Rosneft and BP.
"Rosneft is not holding talks of any kind with the shareholders of TNK-BP," Khudainatov told a call with analysts.
Khudainatov was responding to a report in the Vedomosti daily that the partners who own half of TNK-BP, Russia's No.3 oil firm, through Alfa-Access-Renova (AAR) were in talks to sell out to Rosneft.
Vedomosti, citing unnamed sources, added that a share swap was under discussion between Rosneft, in which the Russian state owns 75 percent, and TNK-BP. BP owns half of TNK-BP.
Rosneft, which has a market value of $91 billion, pumped 2.3 million bpd of crude in 2010, boosting production by 6.4 percent as it ramped up production at its flagship Vankor field.
TNK-BP, with a market cap of $45 billion, produces 1.4 million bpd. Buying half of TNK-BP would lift Rosneft's output to 3 million bpd, putting it ahead of Exxon's liquids production of 2.5 million bpd.
Speculation has intensified over the future of TNK-BP since BP and Rosneft struck an Arctic exploration pact last month and agreed to a $16 billion share swap.
The deal, followed by a similar partnership between Rosneft and Exxon, opened the door to global oil majors that was closed during the bankruptcy and breakup of Yukos, then Russia's top oil firm, and the acquisition of its prime assets via Rosneft.
AAR, representing tycoons Mikhail Fridman, German Khan, Viktor Vekselberg and Len Blavatnik, said the deal violated its shareholder agreement with BP and won an injunction in a London court this week to put it on hold.
The two parties will now seek a resolution to their dispute via arbitration in Stockholm.
Industry sources say the Russian partners are pushing to get a piece of the action in the Arctic or to partner with BP abroad, as TNK-BP's Siberian operations are growing slowly and face a "peak oil" scenario going into the 2020s.
Rosneft's chairman, Deputy Premier Igor Sechin, is believed to want to build out the company as a national champion. Sechin cancelled his participation on a press trip to a TNK-BP oilfield on Thursday after journalists had already taken off from Moscow.
A source close to the TNK-BP board said the Vedomosti report was nonsense, adding: "As the company has said, we are just looking to use the business opportunities presented in this (BP-Rosneft) deal."
A state industry source suggested that the report was a trial balloon to see whether there may be interest on Rosneft's part in buying out TNK-BP's local partners.
"They just are starting to fish around," the source said.
Rosneft has in recent years been ill placed to make acquisitions due to the debts it took on to buy Yukos's assets.
But strong oil prices and output growth boosted its EBITDA, a proxy for cash flow, by 42 percent to $19.2 billion last year while net debt fell by 26 percent to $13.7 billion at year end.
Much of Rosneft's borrowing is covered by a low-cost Chinese loan secured against oil pumped via the Eastern Siberia-Pacific Ocean pipeline that has just begun supplies via a spur to China.
"Rosneft ... could raise an additional $20 billion before its net debt/EBITDA level breaks 2.0, and we believe the market will tolerate higher debt levels as well," analysts at brokerage Troika Dialog said in a note.
ReutersLast Mod: 05 Şubat 2011, 11:15