“The most important thing in jazz, just as in life, is improvisation.” So wrote Igor Sechin, the hard-boiled chief executive of Rosneft, in a rare personal article on his passion for music. Someone who has been called Russia’s Darth Vader and who wields huge influence behind the scenes in the Kremlin might seem an unlikely fan of Charlie Parker, but he has, nonetheless, taken the art of improvisation in Russian business to new heights.
Last week in St Petersburg, Mr Sechin signed a deal with Bob Dudley, of BP, to collaborate on the distribution of vast deposits of Russian gas to western Europe, a long-term project that could generate billions of dollars for the British oil company. On the face of it, this represented a remarkable leap of faith by Mr Dudley: in 2008, when he was chief executive of TNK-BP, a joint venture between BP and a band of Russian oligarchs, he fled Moscow amid a dizzying swirl of lawsuits, tax investigations and official harassment. The American oilman couldn’t even get his work visa renewed and, after a campaign of intimidation, he was forced to go into hiding in Bermuda.
More to the point, according to embassy cables released by Wikileaks, Mr Dudley told the US ambassador at the time that he thought Mr Sechin (claimed by some to have begun his career as a spy) was behind the campaign to wrest management control of TNK-BP away from BP.
But times have changed. These days, Mr Dudley seems to be in Russia a lot and is on good terms with Mr Sechin. The pair regularly sit together at meetings on the board of Rosneft. Why? Because in 2013, BP’s 50 per cent stake in TNK-BP was converted into a 19.75 per cent stake in Rosneft, a state-controlled company that is the world’s biggest publicly traded oil producer. And much more important than their history of personal enmity is the fact that the Rosneft deal has been profitable for BP, which now derives one third of its production from Russia and which is relying heavily on Russia for long-term growth.
The timing of the latest deal is no coincidence. After years in the deep freeze because of political tensions over Crimea, relations between Russia and the United States are warming, with a beneficial effect on BP’s Russia investments.
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Mr Sechin is getting plenty out of this, too. He wants western cash and expertise to help to unlock the nation’s hydrocarbon reserves, especially in the Arctic. BP, despite the continued existence of sanctions including a personal travel ban and an asset freeze for Igor Sechin, seems happy to help.
“Our work is compliant,” a note on BP’s website says about the company’s Russia business. “BP is used to operating within sanction regimes and it’s something we carefully consider at all times.”
Mr Dudley’s willingness to do deals in Russia should come as no surprise for another reason. With Rex Tillerson, the Texan former Exxon Mobil chief, as US Secretary of State, Mr Sechin’s influence over western policy is likely to grow. Rex and Igor go back a long way, having worked together on oil deals since the early 2000s. In 2014, Mr Sechin said that one of his ambitions was “to ride the roads in the United States on motorcycles with Tillerson”. Such warm ties cannot be bad news for Rosneft’s future prospects, including a stalled project with Exxon Mobil to drill in the Kara Sea.
Mr Sechin has been busy in recent months — in December, he crafted a deal to sell an $11 billion stake in Rosneft to Glencore and Qatar — yet his ultimate goal is to transform Rosneft from a domestic producer into a global oil and gas giant. With that in mind, it’s fair to assume that his free-form improvisation is likely to continue.
•Robin Pagnamenta is Deputy Business Editor of The Times