Reuters has released a rumor that BP PLC (NYSE: BP) will sell its 50% interest in TNK-BP to partner Rosneft. There have been rumors off and on in the press that such a deal would be worth $25 billion to BP.

The Reuters report says that BP will receive a 16% to 20% ownership position in the Russia state controlled oil firm Rosneft. It is not clear what the cash portion of the transaction might be:

Reuters reports:

The deal can be described as having two steps for a single transaction worth in excess of $25 billion, according to one source familiar with a proposal that was put to BP by Rosneft last week.

Under step one, BP will receive a 13.4 percent holding of Rosneft's shares that belongs at present to Rosneft in the form of so-called "treasury stock", and which is nominally worth about $10 billion based on a tiny free-float of Rosneft shares that put the value of the company at around $73.5 billion. It will also receive an amount of cash.

Under step two, BP will use some of that cash to buy more Rosneft stock, as it promised to do at a recent meeting between (Igor Sechin Rosneft CEO)  and BP's chief executive Bob Dudley.

Reuters does not appear to be in a position to be even certain of the most basic portions of the deal.

Douglas A. McIntyre

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