Oil major BP Plc is close to a deal with its Russian partner, state oil company Rosneft, for a new project that would expand its commitments in Russia despite Western sanctions, Kommersant business daily reported on Wednesday. The daily cited unnamed sources as saying BP will pay $700-$800 million to acquire 20 percent in Taas-Yuriakh, a field in East Siberia estimated to contain up to 1 billion barrels in reserves.
The deal would not breach any European or U.S. sanctions, which prohibit Western companies from providing long-term financing to Rosneft and many other Russian companies. The sanctions, which also forbid providing technology for Arctic, shale and deep water exploration, were imposed earlier this year to punish Russia for the annexation of Crimea and its incursion into East Ukraine.
BP has a stake of just under 20 percent in Rosneft. Rosneft and BP declined to comment on the report. BP faces a first and heavy loss from the stake due to plummeting oil prices and a crumbling rouble, potentially forcing it to write down the value of the once-prized asset.