Via their joint venture with OAO Lukoil, TNK-BP, BP (NYSE:BP) is vying for rights to develop the Trebs and Titov oil fields, with the deadline to apply being on Monday the 20th.
The two oil fields are the largest undistributed oil fields in Russia.
Citigroup (NYSE:C) analysts recently said, “As Rosneft’s stellar performance of the past two years was driven by successful Vankor development, we believe that the company that ultimately wins the auction has good chances of being re-rated by the market. The auction will be a litmus test to reveal the sector winner.”
TNK-BP is hungry for this deal, as it would make them the second-largest oil producer in Russia.
This would be a great deal for BP as well, as TNK-BP generates close to 25 percent of production and 20 percent of reserves for the company. They produce about 1.7 million barrels of oil a day.
Opening bid for the assets is $587 million, which is expected to increase significantly because of the competitors wanting them, including, along with TNK-BP: OAO Gazprom, OAO Bashneft and India-based ONGC.
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