MOSCOW, Oct 18: Rosneft was on the verge on Thursday of becoming the world’s biggest public oil trader by buying BP’s half interest in the troubled but rich TNK-BP joint venture in Russia.

State-owned Rosneft waited until an 0800 GMT deadline before making a cash-and-shares offer which Dow Jones Newswires valued at $25 billion — about three billion dollars less than indicated in earlier press reports. That deal is set to be followed with a buyout of BP’s four ex-Soviet billionaire partners for an even larger sum of up to $29 billion.

Completing the deal would bring the Russian state its greatest control of the oil sector since the Soviet era and re-define how the market operates under President Vladimir Putin. The TNK-BP agreements culminate a year of tumult at Russia’s third-largest oil company that highlighted the problems Western majors had in settling in for profitable business with Putin and his coterie of former spies in control.

The Financial Times reported that under Thursday’s deal will see BP raise its stake in Rosneft from 1.4 per cent to between 10 and 20 per cent. But Rosneft stressed that both deals were still only at the draft stage and did not imply necessary agreement.

“We continue to evaluate a number of opportunities and will update the market as and when appropriate,” a Rosneft spokesperson said in an e-mailed statement to AFP.

And BP spokesman in London said only that “we are reviewing options including any offers that we have received.” Rosneft and the Soviet-born oligarchs who own the other half of TNK-BP had signed a memorandum of understanding on Tuesday which would result in Rosneft acquiring the Russian tycoons’ stake at a later date.

The billionaires have experienced strained ties with the Russian government and were forced to concede that a company run by them and Rosneft jointly would most likely fail to function and require them eventually to sell their stake.—AFP