bp and Equinor to Exit Russian Investments
The bp board announced that bp will exit its shareholding in Rosneft. bp has held a 19.75% shareholding in Rosneft since 2013.
Additionally, bp chief executive officer Bernard Looney is resigning from the board of Rosneft with immediate effect. The other Rosneft director nominated by bp, former bp group chief executive Bob Dudley, is similarly resigning from the board.
The resignations will require bp to change its accounting treatment of its Rosneft shareholding and, as a result, it expects to report a material non-cash charge with its first quarter 2022 results, to be reported in May.
bp chair Helge Lund said: “Russia’s attack on Ukraine is an act of aggression which is having tragic consequences across the region. bp has operated in Russia for over 30 years, working with brilliant Russian colleagues. However, this military action represents a fundamental change. It has led the bp board to conclude, after a thorough process, that our involvement with Rosneft, a state-owned enterprise, simply cannot continue. We can no longer support bp representatives holding a role on the Rosneft board. The Rosneft holding is no longer aligned with bp’s business and strategy and it is now the board’s decision to exit bp’s shareholding in Rosneft. The bp board believes these decisions are in the best long-term interests of all our shareholders.”
“Like so many, I have been deeply shocked and saddened by the situation unfolding in Ukraine and my heart goes out to everyone affected. It has caused us to fundamentally rethink bp’s position with Rosneft. I am convinced that the decisions we have taken as a board are not only the right thing to do, but are also in the long-term interests of bp. Our immediate priority is caring for our great people in the region, and we will do our utmost to support them. We are also looking at how bp can support the wider humanitarian effort,” bp chief executive officer Bernard Looney added.
Bernard Looney has been a director of Rosneft as one of two bp-nominated directors since 2020. Bob Dudley has been a director of Rosneft since 2013.
bp will also exit its other businesses with Rosneft within Russia.
bp will continue to comply with all relevant international trade rules and sanctions. It continues to keep this situation under review.
Equinor to contribute funding to the humanitarian effort in the region
Equinor’s Board of Directors has decided to stop new investments into Russia, and to start the process of exiting Equinor’s Russian Joint Ventures.
“We are all deeply troubled by the invasion of Ukraine, which represents a terrible setback for the world, and we are thinking of all those who are suffering because of the military action,” says Anders Opedal, President and CEO of Equinor.
Equinor will present a commitment to contribute funding to the humanitarian effort in the region.
“In the current situation, we regard our position as untenable. We will now stop new investments into our Russian business, and we will start the process of exiting our joint ventures in a manner that is consistent with our values. Our top priority in this difficult situation is the safety and security of our people,” says Opedal.
Equinor has been in Russia for over 30 years and entered a cooperation agreement with Rosneft in 2012.
“We have employees from both Ukraine and Russia, and we are proud of how our people from different backgrounds and nationalities collaborate – with mutual respect, as one team in Equinor,” says Opedal.
Equinor has operated in compliance with Norwegian, European Union and United States’ sanctions. Equinor maintains close contact with the authorities in Norway, the European Union, the United States, and other countries, and will continue to comply with any new sanctions relevant to their operations.
At the end of 2021 Equinor had USD 1.2 billion in non-current assets in Russia. The company expects that the decision to start the process of exiting Joint Ventures in Russia will impact the book value of Equinor’s Russian assets and lead to impairments.
