BP PLC (BP.LN) Monday sought to reassure investors that cash flow from its Russian joint venture, TNK-BP (TNBP.RS), which has been absent since the beginning of the year as a boardroom impasse holds up dividend payments, is not essential to its own ability to return money to shareholders.

"Dividends from TNK-BP are one of many sources of BP's operating cash flow, they do not directly fund BP's own dividends to its shareholders," BP said in a statement.

The declaration came hours after BP's Russian partners in TNK-BP, a group of Soviet-born billionaires collectively known as the Alfa Access Renova consortium, rejected a ten-day-old motion put forward by BP for the joint venture to pay a $1 billion interim dividend. The payment would be shared equally by AAR and BP.

The decision reflects a long-standing impasse between the partners in TNK-BP and comes as BP mulls selling out of the turbulent, yet highly-profitable joint venture. For months, the company's board has been unable to function at the most basic level. It had to cancel planned meetings in February and May because it lacked the required number of independent directors to convene normally.

The shareholder agreement that governs TNK-BP requires 11 directors to take part in board meetings, including three independent board members. At present, TNK-BP only has two independent directors, Alexander Shokhin and Evert Henkes. Without a quorum of directors, the company's board can't approve quarterly dividends.

TNK-BP has a policy of paying at least 40% of its net income to its shareholders. With regular quarterly dividends suspended, BP proposed a $1 billion additional dividend on July 20, AAR said in a statement Monday. This would net the U.K. energy giant $500 million, as a 50% shareholder.

AAR said paying an interim dividend would be ill-advised at present. TNK-BP Friday reported a drop in second-quarter net profit to $808 million, from $2.19 billion last year, due largely to lower oil prices in the period.

"At a time of continuing market uncertainty, and while corporate governance at TNK-BP remains strained, we believe that a cautious stance by shareholders is called for. A payment now of an additional dividend is not prudent," said AAR Chief Executive Stan Polovets.

The dividend spat comes amid renewed speculation over BP's future participation in TNK-BP , Russia 's third-largest oil company. BP said last month that it was considering selling its stake in TNK-BP, after receiving expressions of interest. AAR and state oil giant OAO Rosneft (ROSN.RS) both said this month that they have entered talks with BP about acquiring all or part of its TNK-BP stake.

Despite the continued uncertainty around BP's future involvement with TNK-BP, the company said it expected its due proceeds of TNK-BP earnings would be safeguarded.

"We are confident that the money will remain in the company and that we can ensure it is correctly deployed in the future," said BP in an emailed statement.

When asked why BP had requested the interim dividend in the first place, if it was sure the earnings would be made available in the future, the spokesman said: "We have a responsibility to our shareholders to ensure good governance is adhered to in companies [in which] we are shareholders."

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