BP
ex-chief Browne to run Russian oligarchs' oil venture:
FT
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[February 28, 2015]
LONDON (Reuters) - John Browne, the
former chief executive of BP , will take charge of a $10 billion oil and
gas venture backed by Russian billionaire Mikhail Fridman to help it
expand internationally through partnerships and acquisitions, the
Financial Times reported.
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Browne told the newspaper he will be appointed executive chairman of
L1 Energy on Monday, giving up his jobs at private equity firm
Riverstone and UK gas explorer Cuadrilla.
The appointment comes as L1 Energy, backed by investment funds owned
by Fridman and his partner German Khan, prepares to complete as
early as next week a 5 billion euro ($5.60 billion) deal to buy RWE
Dea [RWEDE.UL], the oil and gas arm of German utility RWE.
The acquisition is a rare development since Russian firms have
struggled to expand abroad over the past year due to US and European
Union sanctions imposed on the country for its actions in Ukraine.
Fridman and Khan plan to turn L1 Energy into a global oil and gas
player, using $14 billion in proceeds from the 2013 sale of their
stake in Russian oil producer TNK-BP [TNKBP.UL] to state-owned
Rosneft.
Browne led BP from 1995 to 2007 and was one of the architects of
TNK-BP, Russia's third largest oil producer at the time, in which BP
owned 50 percent.
Before agreeing to form TNK-BP, Browne and the oligarchs a endured a
rocky relationship for several years because BP had effectively
accused the Russians of stealing its assets.
L1 Energy will be capitalized with $10 billion of equity from
LetterOne and also be funded by debt. The intention, said Browne,
was “to build great partnerships” and “create something with lasting
value” using Dea, which owns UK North Sea assets, as a platform.
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“The first thing we will do is look in Dea’s areas of expertise to
see where we can expand in those areas,” Browne told the FT.
“Secondly, we will look at the whole of North America to see what
can be done and with whom we can partner there. Then we will look
around the rest of world."
The FT did not say how much Browne would be paid. His role at L1
could help overcome certain complications in the UK. L1 has been
seeking a letter of comfort from the government to make sure its
newly acquired assets in the North Sea are not seized if additional
sanctions are imposed on Russia.
(Reporting by Dmitry Zhdannikov, editing by Louise Heavens)
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