BP’s plan to sell its 50pc stake in TNK-BP will be critical to the future of   the British oil giant – but it may also be a catalyst for a wider shake-up   of the Russia’s energy sector.

The corporate soap opera starring BP and its oligarch partners, AAR, looks set   to run for many months. Some still doubt that BP really wants to exit the   lucrative venture. They suggest its chief executive, Bob Dudley, could be   playing a tactical game to “smoke out” the troublesome oligarchs   who are proving impossible to work with – to make them co-operate or sell   their stake to a more compliant bedfellow. BP insists it isn’t bluffing and   really does want to sell – an idea welcomed by some in the City, so long as   BP can get a good price.

Meanwhile, the oligarchs say they do not want to exit, and that they want to   buy BP’s stake – yet they would also be willing to sell their stake for the   right price.

Amid the contradictory messages, analysts say, one thing seems clear: at least   one of the partners is likely to sell, and that means half of Russia’s third   largest oil company is up for grabs.

How that pans out will be revealing for the future of the country’s oil and   gas industry.

“BP’s announcement raises important questions about the future shape of   the sector as a whole in Russia,” says John Lough, Russian energy   expert at Chatham House and a former advisor to TNK-BP. “The impending   change of ownership will affect the balance of the Russian oil and gas   industry.”

Favourite to buy BP’s stake is, effectively, the Russian state – most likely   through oil producer Rosneft, or holding company, Rosneftegaz.

Analysts believe that Vladimir Putin, recently returned to the Presidency,   wants to further extend the state’s grip.

“I think they look at TNK-BP as a kind of Russian state asset,” says   Iain Reid at Jefferies. “Before the Soviet Union broke up, these were   all state assets. I think Putin would like to get as much as possible back   into state control. I would be very surprised if it doesn’t end up with   Rosneft.”

Even if AAR buys BP’s stake, Mr Lough at Chatham House argues, it is likely to   have to sell it on to one of the state-run companies.

The effect would be to put a further 8pc of Russia’s oil production in state   hands – on top of the 30pc it directly controls, and 12pc it indirectly   controls through secretive ‘private’ company Surgutneftegaz.

Speculation that Rosneft’s role is to grow has been fuelled by last month’s   appointment of Igor Sechin as its chief executive. Sechin, a formidable   Putin ally dubbed Darth Vader, is an anti-privatisation hawk who built up   Rosneft and became Russia’s energy tsar. Some felt that Sechin’s influence   had waned of late, not helped by his masterminding of BP’s failed attempt to   tie-up with Rosneft last year. But the important Rosneft role appears to   signal that he is back.

Many believe it most likely that Sechin has been given a mandate to mastermind   a bigger shake-up of the state ownership model and extend the role of   Rosneftegaz, having recently been appointed to its board.

If Sechin does use Rosneft or Rosneftegaz to buy BP’s stake in TNK-BP, that in   turn raises questions for the AAR oligarchs’ role. Some suggest they would   inevitably also then head for the door, their influence overpowered by the   state and with Sechin perhaps keen to punish them for blocking the   BP-Rosneft deal. Others are not sure the picture is so clear – noting   oligarch Mikhail Fridman has proven a powerful lobbyist.

If Sechin has been given a mandate to carry out a wider shake-up of the oil   and gas sector, the spotlight will also fall on Gazprom, the gas-focused,   state-controlled behemoth which some suggest could be target for a shake-up.

The company, headed by Alexey Miller, is seen to be already struggling with   too much on its plate elsewhere – it has seen delays with its the giant   Shtokman gas field in the Barents Sea. “Gazprom is seen as in need of   renewal,” says one industry source. “It is quite inefficient in   certain areas.”

Analysts at risk consultants Maplecroft say Putin’s return to the presidency   will see him “engage in restructuring the elites that have underpinned   his influence over government”.

So a shake-up of state energy assets could perhaps benefit the likes of oil   trader Gennady Timchenko, a very close associate of Putin and a major   shareholder in independent gas producer Novatek.

Keeping a close eye on the developments will be Western oil majors. Despite an   apparent drive for greater state expansion, Russia also needs foreign help   to develop the vast but challenging reserves of the Arctic.

Putin and Sechin “are going to have to be willing to allow foreigners in   and have less state ownership in certain types of projects,” says Lysle   Brinker, director of energy equity research at IHS. “All the biggest   companies still recognise that there is so much tremendous potential   resources in Russia that you just can’t ignore it – even though it’s a very   challenging environment in which to do business.”

And that is why some believe that even if BP exits the TNK-BP soap opera, it   may still find itself a role in the wider Russian energy play. “BP has   set something interesting in motion,” one industry source says. “Some   pieces are going to now move around on the board – and they may see   potential opportunities created.”