BP said Sunday it is exiting its share in Rosneft, a state-controlled Russian oil and gas company, in reaction to Russia’s invasion of Ukraine.
BP has held a 19.75% stake in Rosneft since 2013. That stake is currently valued at $14 billion.
London-based BP also said its CEO, Bernard Looney, and former BP executive Bob Dudley will immediately resign from Rosneft’s board.
“Like so many, I have been deeply shocked and saddened by the situation unfolding in Ukraine and my heart goes out to everyone affected. It has caused us to fundamentally rethink BP’s position with Rosneft,” Looney said in a statement.
Rosneft said it was informed of BP’s decision Sunday.
“BP has come under unprecedented pressure from both the regulator and its shareholders. BP’s decision was preceded by a Western media campaign full of false reports and conclusions,” Rosneft said in a statement on its website that was translated by The Associated Press. “The decision of the largest minority shareholder of Rosneft destroys the successful, 30-year-long cooperation of the two companies.”
BP Chairman Helge Lund praised the “brilliant Russian colleagues” BP has worked with for decades, but said Russia’s military action “represents a fundamental change.”
“The Rosneft holding is no longer aligned with BP’s business and strategy and it is now the board’s decision to exit BP’s shareholding in Rosneft,” Lund said in a statement.
BP’s action was an abrupt turnaround from earlier this month. During a conference call with investors on Feb. 8, Looney downplayed concerns and said there were no changes to the company’s business in Russia.
“Let’s not worry about things until they happen. And who knows what’s going to happen?” Looney said.
Kwasi Kwarteng, the U.K.’s secretary of state for business and energy, said he welcomed BP’s decision.
“Russia’s unprovoked invasion of Ukraine must be a wake up call for British businesses with commercial interests in Putin’s Russia,” Kwarteng said in a tweet.
BP said it will take two non-cash charges in the first quarter to reflect the change, including an $11 billion charge for foreign exchange losses that have accumulated since 2013.
It is not clear exactly how BP will unwind its holdings, or who might step up to buy them.
Rosneft’s partnerships with Western oil and gas companies have been stymied before.
In 2011, Exxon Mobil, led at the time by future U.S. Secretary of State Rex Tillerson, signed a deal with Rosneft to potentially drill in the oil-rich Russian Arctic. But Exxon ended that partnership in 2017, citing U.S. and European sanctions against Russia.