BP battles to clinch Kremlin Arctic deal as deadline looms

Talks between BP and its billionaire Russian partner AAR went down to the wire today as the British oil giant desperately tried to seal a deal that would allow it to press ahead with its

The main deal being considered was BP buying out AAR, the group of oligarchs who co-own its current Russian joint venture TNK-BP.

The billionaire backers, who are led by Mikhail Fridman, were today considering giving Rosneft their 50% stake in TNK-BP in return for cash and substantial stakes in both BP and Rosneft, thought to be worth $30 billion. The talks were at crisis point as BP faces a deadline of midnight tonight to sign the contract for a share swap and Arctic alliance with state-owned Rosneft. A spokesman for BP said it wouldn't know the final results of the talks until late tonight or early tomorrow morning.

It is now more than five months since BP went public with its huge Russian deal. The first big announcement by chief executive Bob Dudley, it was supposed to propel BP ahead after its disastrous Gulf of Mexico oil spill, but was thwarted by AAR's objections.

The billionaire group took BP to court, saying it was violating its shareholder agreement to use TNK-BP as its principal vehicle for investment in Russia, and arbitrators ruled that BP could only carry out the $16 billion share swap with Rosneft if it allowed TNK-BP to have a role in any exploration.