Using the Orange Revolution to Raid TNK-BP
- By Unknown
- Apr. 02 2008 00:00
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Things are definitely not going well for TNK-BP these days. Plainclothes police officers raided the company's headquarters on March 19, and a Russian-American employee and his brother were arrested on industrial espionage charges. Then, TNK-BP suspended 148 foreign employees amid a dispute with the Federal Migration Service.
It is worth noting that authorities have directed their wrath exclusively at the foreign partners of TNK-BP, a 50-50 joint venture between British oil major BP and three Russian oligarchs, Mikhail Fridman, Viktor Vekselberg and Lev Blavatnik.
The arrest of the two alleged foreign spies, which ostensibly served as the grounds for raiding the TNK-BP offices, was announced in a manner befitting the Soviet-era satirical magazine Crocodile. Just take the Federal Security Service news release, which stated that the search had uncovered "business cards belonging to CIA agents." For those of you who don't know, all CIA agents carry such cards and underneath the words "secret agent," you might also see the inscription, "I destroy Russia and foment Orange Revolutions."
It would be logical to consider these raids as an attack on the company as a whole. But there have been a lot of rumors circulating within Moscow's business community that these unfortunate events took place shortly after President Vladimir Putin met with a top executive of Alfa Group, Fridman's investment vehicle in the TNK-BP joint venture. The Alfa Group businessman supposedly complained to Putin that BP was always getting in the way and hampering the joint venture's growth.
The TNK-BP incident is reminiscent of the attempt to create YukosSibneft, when Sibneft head Roman Abramovich joined forces with Yukos CEO Mikhail Khodorkovsky in an attempt to merge the two companies and maximize profits. At that time, Abramovich had absolutely no intention of dismantling Yukos or to force it to sell out. Later, however, when the Kremlin's political winds shifted, Abramovich understood that to keep his business empire intact, he had to participate in the takeover of Yukos with hefty backing from the government because this became the optimal business decision for him in the new, hostile political environment.
In the beginning, Alfa Group was serious about its partnership with BP. Then, the political environment changed drastically after the poisoning death of former FSB officer Alexander Litvinenko in London, the Kremlin's ongoing harassment of the British Council, and the administration's growing dissatisfaction with the foreign presence in Russia's oil and gas sectors.
Alfa Group understands very well that the best business decision to make would be to remove BP from its management role in the joint venture before the government itself takes over the company. Alfa now finds itself in the same position as a Chechen warlord: To become a battalion commander under Chechen President Ramzan Kadyrov, you must be willing to betray your own colleagues.
Alfa Group has managed to win major business battles before -- for example, in its struggle with Oneksimbank for control of Sidanco oil company and with IT and Communications Minister Leonid Reiman for MegaFon. If everything goes right, Alfa Group could again come out the winner by reducing BP to a passive shareholder and taking control of TNK-BP. The Kremlin will see these actions as a victory over the deplorable British, and the British side can be persuaded that Alfa is doing everything possible to keep the British partners from being kicked out.
In a worst-case scenario, the state could shove heavyweight BP out of the picture and then turn around and swallow up Alfa for a light snack.
Yulia Latynina hosts a political talk show on Ekho Moskvy radio.