BP chief executive Lord Browne meets with head of Russia's Gazprom amid stalled project

The companies revealed little about BP PLC Chief Executive Lord Browne's meeting with OAO Gazprom CEO Alexei Miller, which BP Moscow office spokesman Vladimir Buyanov called "very constructive."

Photo: BP chief executive Lord Browne meets with head of Russia's Gazprom amid stalled project

BP chief executive Lord Browne meets with head of Russia's Gazprom amid stalled project

In a statement, Gazprom said they discussed potential cooperation in European, U.S. and Russian energy markets, with attention to liquefied natural gas projects as well as extraction and refining, the AP reports.

BP's plans for the Kovykta gas field have been stymied by Gazprom's reluctance to provide for the transport of gas from the site, and the company's future in Russia is clouded by government policy limiting foreign participation in energy projects considered strategically important.

BP's Russian joint venture, TNK-BP, has a license to develop the Kovykta field in southeastern Siberia, not far from energy-hungry China - a prize that is essentially worthless without agreement from Gazprom to provide transportation through its pipeline system, which has so far been withheld despite TNK-BP's offer of a majority position in the project.

Potential gas production in this field could reach 40 billion cubic meters a year, with gas planned to be supplied to the domestic market and to Far Eastern markets including China and South Korea. TNK-BP owns 63 percent in RUSIA Petroleum which holds the exploration licenses for the Kovykta field development.

The 50-50 ownership structure of TNK-BP threatens to deprive the company of participation in major Russian projects because of long-planned legislation that is likely to shut companies that are not majority Russian-owned out of new efforts to develop the country's largest oil, gas and mineral deposits.