From Russia With No Love For BP

OAO Rosneft, Russia's largest oil company, is reportedly unwilling to extend a deadline to move forward with a controversial $16 billion share swap with BP BP, Europe's second-largest oil company, news that will be a stinging blow to BP CEO Bob Dudley's plans to turn the company following the largest oil spill in U.S. history. News that Rosneft refused to extend the deadline was originally reported by the Financial Times. The share swap, which was to see Rosneft pay $7.8 billion for 5% of BP, was seen as crucial to Dudley's efforts to bolster BP's position in oil-rich Russia. It was also seen as an effort to repair Dudley's damaged image Russia, which had suffered when he left TNK-BP several years ago. The deadline expired at midnight on Monday and came and went with no news regarding BP's reported acquisition attempt of TNK-BP, is joint Russian venture with oligarch investors. TNK-BP, Russia's third-largest oil company, has stood in the way of the BP/Rosneft accord claiming it violates the venture's shareholder rights agreement with the British oil giant. Sources said on Monday that talks could continue beyond the deadline, although the expiry of the original deal raises the possibility that Rosneft could seek to redraft the terms, Reuters reported. Rosneft, which has been strongly opposed to TNK-BP joining the Arctic drilling alliance that had been the cornerstone of the proposed deal with BP, could pursue a partnership with another oil major, something that has been rumored since the original deadline expired on April 14. Russian oil companies have previously been reluctant to allow Western rivals acces to the Arctic region, but the Russian firms have loosened that stance, realizing they need the technological and deepwater drilling expertise possessed by Western oil majors. Exxon Mobil XOM and Royal Dutch Shell RDS, the largest U.S. and European oil companies, have been frequently mentioned as possible replacements for BP in the Rosneft pact though a Citigroup report issued last week said Chevron CVX could also be a potential partner for Rosneft.