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Chinese Sinopec buys Udmurtneft from TNK-BP

Russia's second largest oil firm TNK-BP has agreed to sell its mid-sized oil unit Udmurtneft to China's Sinopec, TNK-BP said in a statement on Tuesday. The parties had exchanged written confirmation of commercial terms, the company added, but did not disclose pricing details.

TKN-BP said earlier Udmurtneft should fetch over USD 3 billion. The tender was launched at the end of 2005. The parties had exchanged written confirmation of commercial terms. Industry sources have said Sinopec had teamed up with Russian state oil firm Rosneft in the race for Udmurtneft, which also included Hungary's MOL, Russia's gas monopoly Gazprom and India's ONGC. “It is expected that settlement will occur in the near future following final agreement and signature of a fully termed Sale and Purchase Agreement. Russian anti—monopoly approval has already been obtained for the transaction," TKN-BP said. “This is a positive development - it brings another major international investor working with strong Russian alliances into the country's oil and gas sector," Robert Dudley, TNK-BP President and CEO commented. “It reinforces Russia's pivotal role in global energy markets. And I believe it will provide the stimulus for increased investment in the industry in Udmurtia. For TNK-BP it will allow us to concentrate more resources on our core exploration and production regions in Russia," he added. (Pf)