Russia's deputy premier to leave Rosneft chair

City A.M. Reporter
Russian president Dmitry Medvedev has ordered top ministers to quit the boards of major state firms, launching a drive to separate politics from business less than a year before a presidential election.

The most prominent target of the shakeout was Igor Sechin, a deputy premier with sweeping control over energy policy who as chairman of oil major Rosneft has masterminded a troubled strategic alliance with Britain's BP.

The removal of Sechin, prime minister Vladimir Putin's most trusted ally, from the helm of Russia's biggest oil company would stoke fears of a struggle for the Kremlin's top job ahead of the March 2012 presidential election.

Analysts warned Sechin's removal would also weaken Rosneft's position as Russia's most powerful oil company.

Sechin was the prime mover behind a deal struck by Rosneft and BP to explore for oil in the Arctic and conduct a $16 billion share swap that has fallen foul of a legal challenge by the tycoon partners in BP's Russian venture TNK-BP.

An arbitration panel will next week hear whether the share swap can go ahead independently of the offshore venture.

"This is obviously negative for Rosneft as Sechin was seen as the biggest advocate of its interests – the shares are down – although the financial impact may be minimal," said Karen Kostanian, head of research at Merrill Lynch in Moscow.

The chairman of Gazprom, deputy premier Viktor Zubkov, was spared the axe, confirming the gas export monopoly's privileged status as an instrument to project Russia's energy might abroad.