Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

TNK Named World's Best Oil Company

In a year when it weathered months of litigation, accusations of judicial manipulations, a police raid, an Audit Chamber investigation and the wrath of the U.S. State Department, Tyumen Oil Co. has been named the best oil and gas firm in the world.

A specialist branch of the prestigious Financial Times Group, FT-Energy, gave TNK its "Best Oil and Gas Company of 2000" award in a New York ceremony Thursday night.

FT-Energy, which bills itself as "the world's most comprehensive provider of global energy industry news," said TNK won for its "phenomenal growth in the past year, breaking into the world's top 15 oil firms and showing remarkable entrepreneurial spirit in extremely trying circumstances."

The six-member international panel of judges included the CEO of the World Coal Institute in London, a UBS Warburg managing director, the chairman of the African Chamber of Commerce in Washington and the head of the Norwegian Water and Energy Directorate in Oslo.

"This is a tremendous honor ... to prevail over such a distinguished group of established global companies," TNK president and CEO Simon Kukes said in a telephone interview Friday from London.

TNK, considered the country's No. 4 oil major after LUKoil, Yukos and Surgutneftegaz, beat out finalists Shell, ATP and British Gas for the honor.

Kukes, a Russian-born former executive at U.S. giant Amoco, said the award is "a vote of confidence not just for TNK, but for the whole Russian oil industry and the Russian government's efforts to improve the investment climate."

With the caveat that the award is largely symbolic, industry experts polled Friday agreed with Kukes that the award is a public relations coup for the country's energy sector.

"Russia has a PR problem ... it generally doesn't promote itself very well abroad," said Alexander Wostmann, editor of Alexander's Oil and Gas Connections, in Cologne, Germany, in a telephone interview. "This award is a great recognition that its oil industry -- and its government -- is serious about making progress."

TNK received wide applause in September when it won what many analysts consider Russia's most transparent and fair tender for a major state enterprise, paying $1.08 billion for 85 percent of Onako, the nation's No. 14 oil company.

TNK is also the only Russian company since the 1998 financial meltdown to secure a major loan guarantee from the U.S.-government owned Export-Import Bank -- some $600 million to upgrade its Ryazan refinery and develop the massive Samotlor field in Siberia.

The U.S. State Department blocked the loan guarantees last December, then reversed its position in April, without explanation. Some reports said at the time that the U.S. move was in response to TNK's controversial acquisition of rival Sidanko's major production unit Chernogorneft. TNK's move outraged BP Amoco, which paid $571 million for a 10 percent stake in Sidanko in 1996.

In the interview Friday, Kukes denied the loan delay had anything to do with Chernogorneft and said that TNK's relationship with BP had been patched up, adding that Chernogorneft would "absolutely" be returned to Sidanko soon.

"We have very good relations with BP now ... and I personally have very good relations with key executives," he said.

With the purchase of Onako, the acquisition of Chernogorneft and Kondpetroleum -- another production unit controversially wrestled from Sidanko -- the purchase of a Ukrainian refinery and a deal with Texaco to expand its Moscow retail network, TNK has outpaced the industry in 2000.

"TNK was able to achieve this phenomenal growth because it is well-managed, ambitious and its managers are highly qualified," said Valery Nesterov at Chase. "It is on its way to becoming a successful global company."