Given TNK-BP’s capitalization of about $40 billion, it won’t be a problem for Gazprom to raise the $20 billion needed to make the purchase. The question is whether the oligarchs who own TNK – Mikhail Fridman, Viktor Vekselberg, and Leonid Blavatnik – will willingly sell their stakes.

TNK-BP’s assets are mostly in Western Siberia, in the regions of Khanty-Mansyisk, Yamalo-Nenets, and Tyumen. In 2005, TNK-BP’s oil production, including its 50 percent Slavneft share, was 87.6 million tons (over 1.5 million barrels per day). In addition to its oil production interests, TNK-BP holds a license through its subsidiary, Rusia Petroleum, to develop Kovykta, one of the world’s largest gas condensate fields. According to government estimates, Kovykta’s annual output is expected to be 30 billion cubic meters of gas (almost 3 Bcf per day) over at least 30 years.

For several years, Kovykta has been a source of conflict with the government. The local government and regional prosecutor’s office have threatened several times to cancel Rusia Petroleum’s Kovykta license over alleged non-compliance with license obligations. Rusia Petroleum committed to develop and produce the field at a certain level, but was unable to do so because Gazprom refused to provide pipeline capacity. If Gazprom buys TNK, it will certainly provide pipelines to Kovykta. Further, by taking over the TNK share of TNK-BP, Gazpromneft will be able to grow its production significantly. The deal will allow it to control the remaining 50 percent share in Slavneft, which is producing over 20 million tons. Under current projections, Gazpromneft’s production next year will exceed 33 million tons; by 2020, that is expected to nearly triple to 80 million tons.

At a press conference attended by ET in Moscow in early October, TNK-BP’s CEO, Robert Dudley, dismissed talks that the Russian shareholders will sell their stake. “We are confident there is a solid future for TNK-BP...Much has been written about the consolidation of the state…As long as we continue to get good results, I think the company will survive.”

Alas, Dudley sounded a lot like Yukos’ former CEO, Stephen Theede, back in 2003, just before the Putin regime launched its decisive assault against his old company. The more likely result: the TNK oligarchs will follow the example set by Sibneft’s old owner, Roman Abramovich, who decided it was better to take the money and run.