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The collapse of a BP share-swap deal with Russian state oil company Rosneft is just one of a string of failures which show that Russia is "uninvestable", according to William Browder, once the country’s largest portfolio investor.
BP’s proposed tie-up with Rosneft fell through after an agreement could not be reached with Alfa Access Renova (AAR) — a consortium of local billionaires who had a pre-existing joint venture with the oil giant, TNK-BP – to break an earlier contract.
BP had been hoping to work with the state-owned company to explore and develop assets in Russia’s arctic regions.
"What this story shows is the long and sad tale of BP in Russia, and how they’ve basically encountered problems at every single turn in their quest to get Russian oil reserves," Browder told CNBC.com.
Citing the trail of western businesses which have encountered difficulties in Russia, including Ikea, Telenor and Shell , Browder said that investors should be aware of the risks of working with a country that has endemic corruption issues, no matter how attractive its assets may appear.
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