BP (BP) Gets Upgrade from BofA (BAC) Analyst

BP (NYSE:BP) a lot of positive input from Bank of America (NYSE:BAC) analyst Alejandro Demichelis, who upgraded the stock to a "Buy."

Demichelis says he sees upside for the oil giant of 31 percent, saying the stock is undervalued from a net asset value basis.

“Importantly, BP appears to be making progress accessing new deepwater opportunities globally (Brazil, Angola, Australia) that can ultimately inject growth in the portfolio outside of the Gulf of Mexico medium term,” Demichelis wrote in a note.

He noted the BP trades at a 50 percent discount to its net asset value, versus an average of 23 percent among its peers.

As to the risk associated with the Macondo oil spill in the Gulf of Mexico, he said “much of this liability has been already priced into the stock (assuming no gross negligence).”

Concerning the debacle in Russia with Rosneft, he had this to say:

“Whilst talks with ROSN/AAR are ongoing, despite the lapsed deadline, we think that it is likely that the deal may not happen, as we struggle to see room for an improved offer. We nonetheless see a resolution of this situation either way as a positive. In our view, if BP does manage to revive the deal this achieves the strategic aim of entering the Arctic, reducing uncertainties. If BP walks away from it, this calls the strategy into question, putting pressure on management to explore more drastic strategic avenues to crystallise value.”

BP closed Thursday at $43.89, gaining $0.62, or 1.43 percent.

BP (BP) Sued for $10 Billion by TNK-BP

Citing sources close to TNK-BP, the Financial Times said BP (NYSE:BP) is being sued by the company for damages of up to $10 billion.

TNK-BP management said, "TNK-BP is preparing documents with minority shareholders in TNK-BP Holding for lawsuits against BP for not informing us of the opportunity with Rosneft and for not winning the agreement of the shareholders," according to the Times article.

The management claims the company has lost opportunities to explore in the Russian arctic because of the actions of BP.

In another recent blow to the oil giant, a proposed $16 billion share-swap with Russian state-run oil company Rosneft was ruled against when arbitrators upheld an interim injunction in the matter.

BP closed Monday at $46.67, falling $0.07, or 0.15 percent.

BP (BP), TNK-BP Battle No Big Deal Says Russia

Russia's investment climate is already so bad that even a battle between BP and its shareholders at Anglo-Russian TNK-BP will not do anything to influence experienced investors, according to a senior Kremlin aide.

BP (NYSE:BP) was blocked from expanding its presence in Russia through a $16 billion share swap and joint exploration plans with Russian state giant Rosneft (ROSN.MM) by a Stockholm arbitration panel last week, after TNK-BP's (TNBP.MM) billionaire partners took the case to court.

The move has led to concerns that other energy firms looking to extend their reach may face similar problems.

"Right now our investment climate is so bad that it won't be affected," President Dmitry Medvedev's top economic aide, Arkady Dvorkovich, told reporters.

He said he was hopeful that the dispute would be settled, and when asked what the Kremlin's advice was, Dvorkovich responded: "Find a solution that is acceptable to both sides. I think they'll find one."




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BP (BP) Crunched on Possible Manslaughter Charges

Shares of BP (NYSE:BP) are taking a hit today on news managers at the company may be pursued by prosecutors with charges of manslaughter.

Also weighing on the stock is the recent battle with its Russian billionaire partners in TNK-BP and its attempt to partner with Rosneft.

In regard to that situation, brokerage Collins Stewart said its lowering its rating on the company from "Hold" to "Sell."

The manslaughter charges are being talked about by prosecutors from the U.S. now, but officials wouldn't confirm one way or the other whether it is under consideration or not, as sources close to the matter who didn't want to be identified revealed the possible scenario of criminal charges.

Most of that will be determined by whether or not the company is deemed "grossly negligent" in the accident. If they are, not only would that open the door for possible criminal charges, but also for massive fines.

BP was trading at $44.91, down $1.13, or 2.45 percent, as of 11:38 AM EDT.

Will BP's (BP) Russian Deal Get Stolen by (XOM), (CVX), (RDS-a)?

Even though the share price of BP (NYSE:BP) won't take much of a hit if things in Russia turn for the worst for them, competitors like Royal Dutch Shell (NYSE:RDS-A), Chevron (NYSE:CVX) and Exxon Mobil (NYSE:XOM)are standing on the sidelines possibly waiting for an opportunity to penetrate the Russian market at the expense of BP.

The story here isn't one that is short term, but rather the future revenue and earnings growth of BP, which Russia is a major part of.

As the WSJ say, "The oil major wants to resurrect its share swap and Arctic exploration deal with Rosneft. It could patch things up with its current Russian partner, Alfa-Access-Renova, or rely on Rosneft itself for more support. But the first option will be expensive—and a frustrated Rosneft may look elsewhere for a fruitful relationship."

"BP is now considering whether it can negotiate a settlement with AAR, according to a person familiar with the situation. That could involve paying cash compensation, or selling assets to TNK-BP, which AAR and BP jointly own. Any deal would be costly—Citigroup estimates the Arctic oil reserves in question might be worth $10 billion to BP. And AAR hasn't shown any willingness to settle; it remains adamantly opposed to BP and Rosneft's share swap."

BP was trading at $46.84, up $0.03, or 0.06 percent, as of 2:30 PM EDT.




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Russian Billionaires Win BP (BP), Rosneft Share-Swap Battle

The share swap deal between BP (NYSE:BP) and OAO Rosneft was blocked by Russian billionaires who had fought against the deal.

BP said in a statement it was disappointed by the outcome of the tribunal and that it would look to find a way to “resolve its differences” with the Russian billionaire partners in its TNK-BP joint venture. It will also apply for a ruling as to whether the share swap can proceed by itself.

BP’s partners, represented by the AAR group, claim the right for TNK-BP to pursue new opportunities in Russia on behalf of the London-based oil company. Last month, they won a court injunction to delay the deal.

The ruling is a setback for BP’s efforts to exploit one of the largest untapped oil troves. The January agreement with Russia’s state-owned oil company was part of Chief Executive Officer Robert Dudley’s strategy to revive the U.K. producer after last year’s Gulf of Mexico oil spill last year.

BP closed Thursday at $46.81, gaining $0.58, or 1.25 percent.




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TNK-BP Wants Piece of BP (BP), or is it Rosneft?

In a move to take a stake in Rosneft, TNK-BP is looking to acquire a 5 percent stake in BP (NYSE:BP) which they would then turn around and swap with Rosneft for a 9 percent stake.

After all of that was completed, BP would end up with half of the 9 percent stake in Rosneft because of their 50 percent stake in TNK-BP.

There doesn't appear to be much chance of the dealing going through, assuming the approximate $8.16 billion could be raised by TNK-BP to make the deal, as it is expected to be opposed by the board of BP and would probably be rejected by Rosneft.

The positive on BP's side would be the cash infusion of $8.16 billion, which would help it in its quest to free up more cash, depending on what the current needs of the company are in light of liabilities connected to the Gulf oil spill.

BP (BP), Exxon (XOM) Joined by Total (TOT) in Russian Oil Deals

With the Arctic Circle opening up to offshore drillers, majors like ExxonMobil (NYSE:XOM), BP Plc (NYSE:BP) and now Total S.A. (NYSE:TOT) are pursuing the Russians in an attempt to secure promising deals.

In the case of Total, they're negotiating with Rosneft to develop fields within the Artic Circle in the Barents Sea, according to Total's head of its Russian office Pierre Nerguararian.

BP was the first of the three to enter a deal with Rosneft, last month agreeing to swap shares with the state-owned Russian company in exchange for access to billions of barrels of crude. That deal is being held up by a challenge from other Russian partners in TNK-BP, which challenged whether BP had the right to make the deal without consulting them first.

Exxon entered a $1 billion deal with Rosneft for exploration rights in the Black Sea.

Total is already working with another Russian partner in the Arctic - Gazprom - where they are developing the Shtokman field, which holds an estimated 3.9 trillion cubic meters of gas.

According to the American government, about 20 percent of the undiscovered oil and gas in the world that can be used commercially is located in the Arctic.

Chevron (CVX) has also entered into a preliminary agreement with Russia to explore a block in the Black Sea.

Russians Believe BP (BP), Rosneft deal Will be Approved

Russia said they believe the deal they made with BP (NYSE:BP) via state-owned Rosneft will be allowed to go ahead after a review from an arbitration tribunal in London.

Billionaire shareholders of TNK-BP Holding, a 50/50 joint-venture between BP and the wealthy Russians, challenged the agreement between BP and Rosneft, arguing terms of their partnership demanded they be notified before BP entered into any deal with another business. They were held to the same requirements as well, assuming they are actually in the agreement.

Rosneft made the deal on the word of BP, which according to First Deputy Prime Minister Igor Shuvalov, the company had "received the necessary assurances from BP. All the rights created by this deal are duely protected by international private and contract law."

BP and Rosneft entered an agreement in January to partake in Arctic oil exploration via an joint venture, where each company took a share in the other's company.

Arbitrators will hold the next meeting in London in the latter part of February.

BP closed Wednesday at $47.30, gaining $0.25, or 0.53 percent.

BP (NYSE:BP) And Russia Entering Energy 'Cold War'?

There is no doubt the entirety of the story surrounding the battle between BP (NYSE:BP) and their Russian billionaire partners, who each own 50 percent of TNK-BP, has been told, as the situation, while tempered for the moment, appears to be still boiling underneath the surface.

It's unknown as to the real level of the conflict between the entities, as it isn't known what the actual issues are, other than the obvious irritation by the billionaires over BP attempting to deal with Russia's state-owned Rosneft.

One important narrative that has emerged from the event is what position of strength BP has in Russia, and whether or not they're caught in the middle of a power struggle between the Russian government and the Russian energy billionaires.

It appears the public face of the battle isn't what is at issue, referring to a proposed deal with Rosneft to drill in the Arctic, while also retaining their current Arctic-drilling deal with the billionaires via TNK-BP, although that is what launched the battle.

Is it as simple as the Russian billionaires contend, that BP has snubbed them for another partner? Are the Russian billionaires wanting to take a bigger position in TNK-BP, or own it altogether? Or is it, as some believe, a battle between the Russian government and the billionaires over the energy resources of the country? Nobody outside knows at this time.

For now is seems a lot of the feathers have been smoothed, but as mentioned, there are too many rumbles beneath the surface to believe the issue has been taken care of to the satisfaction of the participants.

More than likely this isn't the end of the fight, and some believe there has been irreparable harm between BP and the billionaires, something that could do a lot of damage to the value of BP if it escalates further, as the partnership accounts for about 33 percent of BP's oil production.

If BP is able to maneuver itself into working with both, it could be an extraordinary deal for them, which could result in billions of dollars in revenue and profits if they find the amount of oil they believe resides in the region.

BP (NYSE:BP), Rosneft Deal to be Service Contract

The original idea of BP (NYSE:BP) and Russian oil production giant Rosneft to participate in a production sharing agreement (PSA) together has been shelved.

Instead the two companies will work together under an operating service contract, with BP developing the offshore oil reserves in the Arctic.

Citing Rosneft Vice President Pavel Fyodorov, Reuters said, "It will be an operating joint venture in accordance with federal laws on subsoil use. It will be an operating service contract."

BP closed Friday at $46.03, down $0.55, or 1.18 percent.

BP (NYSE:BP), Russian Billionaires Ordered to Arbitrate over Rosneft Venture

Russian billionaires who are partners with BP (NYSE:BP) in the TNK-BP joint venture, won an order from a British court to block the proposed joint venture with Rosneft to explore in the Artic.

The court ordered the two parties to arbitration to settle the matter, which must take place by February 25.

According to the Russian billionaires, they had the right of first refusal on any work BP would perform in the country.

David Peattie, BP’s head of Russian operations, responded to the order saying, “It has always been BP’s position that these matters should be resolved through arbitration, and we are pleased that this is what the court has now decided.”

Rosneft and BP has agreed to a share swap in order to form the partnership to explore the Arctic waters.

BP closed Tuesday at $47.98, gaining $0.51, or 1.07 percent.

BP (NYSE:BP), Rosneft Looking Outside Russia for Project

Hot off of signing a joint deal in the Russian Arctic, BP (NYSE:BP) and Rosneft, according to RIA Novosti, are apparently looking for a project to work together outside of Russian waters.

The parameters of the new project would be about the same as those that will be used for offshore drilling in the Kara Sea.

What the companies want to do is use the new project as a means to test their operations and technology before implementing it in the Arctic.

They want the conditions surrounding the project to be similar to the harsh conditions they'll face in Russian waters.

BP and Rosneft have agreed to develop three blocks in the Russia Arctic Ocean, identified as East Prinovozemelsk-1, 2 and 3. Reserves are estimated at five billion metric tons of oil and 10 trillion cubic meters of natural gas.

BP closed Friday at $47.61, up $0.04, or 0.08 percent.

BP's (NYSE:BP) CEO Robert Dudley Says Rosneft Won't Affect Dividend Decision

The deal announcement after the market closed on Friday that BP was going to swap shares with Russia’s OAO Rosneft in a $7.8 billion deal.

Asked in a Bloomberg television interview on whether or not it would affect the dividend decision, Dudley stated, “It doesn’t impact the dividend decision. Our decisions have yet to be made on the dividend. We have a new set of shareholders, but it’s not going to change that.”

The benefit and purpose of the deal is for the two companies to drill off the north coast of Russia in the Kara Sea in the Arctic circle. Regions in the Arctic could hold up to $100 billion barrels of oil.

BP will get a 9.5 percent stake of Rosneft while Rosneft will get 5 percent stake in BP.

Russia's Rosneft Acquires 5 Percent Stake in BP (NYSE:BP)

More news is coming out concerning the deal between BP (NYSE:BP) and the largest oil company in Russia: Rosneft. The latest is the Russian oil giant has taken a 5 percent stake in BP common shares in exchange for approximately 9.5 percent of Rosneft.

BP and Russia have had a cooperation agreement in place since 2006, but this is the real first action that has been taken since then by the two entities.

According to BP, they said in a statement that it will "create strategic alignment to pursue joint projects and demonstrates mutual confidence in the growth potential of both companies."

Russia's Vladimir Putin has signed off on the deal, which BP's CEO Bob Dudley said will result in the development of the Kara Sea region in the Siberian North.

BP closed Friday at $49.25, gaining $1.71, or 3.60 percent.

BP (NYSE:BP) Partnering with Russia's Rosneft to Develop Continental Shelf

BP (NYSE:BP) announced Friday it is partnering with Russia's largest oil company Rosneft to develop artic resources under Russian control.

CEO Bod Dudley said the two companies will work in the Kara Sea, located in the northern part of Siberia.

BP has been eyeing Russia as a key component of their global strategy, have a cooperative deal in place since 2006, but having no real results from it until now.

At this time about 25 percent of BP's reserves come from Russian oil, at least before the Gulf of Mexico oil spill, so continuing to cooperate and work with Russia is vital to the interests of Bob Dudley and BP.

BP closed Friday at $49.25, gaining $1.71, or 3.60 percent.