BP PLC (BP) Tuesday said its Russian joint-venture TNK-BP Holding (TNBP.RS) swung to a net loss for the fourth quarter of 2008, while oil production remained almost unchanged.
BP, which owns 50% in the Russian-British oil major, said its share of the net loss was $682 million in the quarter compared with a profit of $752 million for the same period of 2007. Therefore, TNK-BP's total fourth-quarter net loss was $1.36 billion.
BP said that the joint venture's loss reflected the impact of the calculation lag on Russian export duties in the falling price environment and "several asset impairments".
Russia's export duty was based in 2008 on the oil price dating two months back, which reduces oil companies' profit as the oil price falls. Plummeting oil prices since then have forced the government to calculate the export duty on average crude prices for one month.
BP said its share of TNK-BP's net profit for full-year 2008 was $2.26 billion, almost unchanged from $2.27 billion in 2007.
BP said its dividend from the joint venture would be $640 million in the fourth quarter, resulting in a full-year dividend of $2.14 billion.
BP's share of the joint-venture oil production in the fourth-quarter was 827,000 barrels per day, marginally down from 829,000 barrels a day in the same period of 2007 and down from 833,000 barrels a day in the third quarter of 2008.