TNK-BP Chief in Question Marathon

MTRobert Dudley leaving the Interior Ministry after being interviewed Tuesday.
TNK-BP chief executive Robert Dudley spent five hours answering questions at an Interior Ministry office Tuesday in what appeared to be the latest episode in a wrangle for control of the company between a group of Russian billionaires and Britain's BP.

Dudley was called to the ministry's Central Federal District office as part of an investigation into "tax matters" related to his company's predecessor, TNK, for which he never worked.

Looking tired but relieved, he downplayed the questioning session as he emerged from the barbwire-topped fence surrounding the compound, passing the Kalashnikov-toting guard at the entrance.

"It was a very routine meeting. There were no problems. It was a review of TNK," Dudley said to the dozen of reporters waiting outside. "Routine matters, by the law, very professional."

As his two bodyguards cleared a path through the group, he repeated the statement to a squall of further questions. His black BMW sped away as soon as the door slammed closed behind him.

Mikhail Fridman, German Khan, Viktor Vekselberg and Len Blavatnik have been embroiled in a bitter dispute with BP over their TNK-BP joint venture, calling for foreign expansion and less reliance on expensive Western employees.

The group of Russian shareholders and BP each own half of the company.

TNK-BP insisted in a statement last week that the Interior Ministry summons was unrelated to the "current shareholders' discussions," but a source close to BP said it was just a part of the efforts by "one group of shareholders" to win control over the company.

In recent months, TNK-BP has suffered a series of setbacks that has been interpreted as an attempt by the Russian shareholders to increase their role in decision-making at the company.

On Monday, TNK-BP sent a senior executive to meet with a Moscow city prosecutor to discuss a probe of its hiring and compensation practices for foreign staff. It has effectively been barred from employing its 150 foreign engineers since March, initially because of visa irregularities, then because they were barred from entering the company's offices by security guards, and now as a result of a court injunction.

In March, federal security agents searched the company's offices after detaining an employee on charges of industrial.

Tuesday's Interior Ministry appointment meant a serious interruption in Dudley's duties at TNK-BP, a source familiar with the situation said.

"It's not particularly normal that he had to spend five hours there — basically an entire work day — when he had other things to attend to," the source said.

Industry sources and analysts believe that the dispute at the company was sparked by plans on the part of a state-owned company, most likely Gazprom or Rosneft, to take a controlling stake in the venture.

Gazprom deputy CEO Alexander Medvedev told reporters at a business forum in France on Tuesday that the gas company would consider investing in TNK-BP only after its shareholders had settled their dispute.

TNK-BP spokeswoman Marina Dracheva said Tuesday that Dudley had been summoned by investigators as a witness in "tax matters pertaining to … TNK activities in 2001-2003."

Although Dudley never worked for TNK, Dracheva said he was questioned because TNK-BP is still responsible for any of the TNK's legal liabilities.

Investigators said they appreciated Dudley's agreement to come talk to them, as he was not legally bound to show up, an Interior Ministry source said, Interfax reported. The source said Dudley provided the information investigators were seeking.

A spokesman for the ministry's Central Federal District office declined comment.

The Interior Ministry said last month that it was investigating a former TNK executive on charges of failing to pay nearly $1 billion in taxes from 2001 to 2003. Interfax reported that the suspect was Simon Kukes, who now heads Samara Nafta.

Kukes' secretary said Tuesday that he was out of the office and that she was unaware when he would come back.

TNK-BP on Tuesday repeated earlier statements that it had repaid the tax arrears. Legally, however, an executive accused of not paying the taxes is still open to prosecution.