TNK-BP: will be slashing costs next year in response to lower oil prices
TNK-BP cools investment amid global chill
Russian producer TNK-BP, half-owned by UK supermajor BP, said it would cut investments by 27% next year in response to lower oil prices.
Acting chief executive Tim Summers said the company will also cut costs by 10% but still aimed to keep production of oil and gas "broadly flat" compared with 2008.
The company's board meeting at the Hotel Crillon in Paris also failed to name a new chief executive.
"2009 will be a tricky environment for us," Summers told Reuters in an interview.
"We will cut our costs on a rouble basis by 10% overall in the company in 2009 from 2008."
Board member and major shareholder Viktor Vekselberg said last month that the meeting would decide a new chief executive.
Summers said the matter was not on the agenda but added: "I am sure the shareholders had offline conversations."
David Peattie, the head of BP's Russian business and a director of TNK-BP, said in an emailed statement: "We are also looking forward to finalising the new shareholder agreement, and appointing a new (chief executive officer) and independent directors in the coming weeks."
TNK-BP's former head Bob Dudley resigned following a stand-off between BP and its oligarch partners in TNK-BP over control of the company. The dispute ended when BP agreed to give its shareholders more say in how the company is run.
Vekselberg has said the former head of the world's largest nickel miner Norilsk Nickel, Denis Morozov, has a solid chance to become chief executive.
Summers, also TNK-BP’s chief operating officer, said 2008 had been a "difficult year", given the shareholder dispute and the subsequent plunge in oil prices.
The price erosion prompted the decision to cut investments to around $3.3 billion in 2009 compared with 4.5 billion in 2008.
TNK-BP is still in talks, led by Vekselberg, with state-controlled Gazprom about the sale of its interest in the giant Kovykta gas field, Summers said.
Vekselberg had predicted a deal by the end of November.
TNK-BP's board agreed to target output at about 602 million barrels of oil equivalent, "broadly flat" compared with anticipated production in 2008, he said.