An arbitral tribunal has ruled that the interim injunction issued to prevent London-based BP Plc's (NYSE: BP) proposed transaction with Rosneft, Moscow, (Russia, London: ROSN) from proceeding will be extended to April 7. The deal involves a reported $16-billion share-swap transaction and plans to explore the Arctic in what would be the first major equity-linked partnership between a national and international oil company.

BP said in a public statement issued March 24 that it will now apply for a determination related to whether the share swap may proceed on its own.

In January, the British oil major entered the global production alliance with Rosneft. BP agreed to issue 988.7 million shares to Rosneft, in exchange for 1.01 billion Rosneft shares. Pro forma, Rosneft would hold 5% of BP's voting shares in exchange for approximately 9.5% of Rosneft's shares.

The exploration pact calls for jointly exploring and developing three license blocks--EPNZ 1, 2, 3--on the Russian Arctic continental shelf. These licenses were awarded to Rosneft in 2010 and cover approximately 125,000 square kilometers in a highly prospective area of the South Kara Sea.

Additionally, the companies intend to establish an Arctic technology center in Russia that will work with various specialists to develop technologies and engineering practices for the safe extraction of hydrocarbon resources from the Arctic shelf, BP said in January.

Following the January announcement, the arbitral tribunal was convened to resolve issues relating to the share-swap agreement and Arctic exploration arrangements, and the parties' obligations under an agreement with Access-Renova (AAR), BP's joint-venture partners and stakeholders in Russian subsidiary TNK-BP.

In its latest public statement, BP says it is disappointed that the agreements are unable to forge ahead in the form intended, due to the legal challenge posed by AAR. BP intends to continue to honor the TNK-BP shareholders' agreement, and will respect the decision of the arbitrators, it said.

Meanwhile, BP will attempt to resolve its differences with its Russian partners to allow these important Russian Arctic developments to proceed, the company said.

Contact the editor, Nancy Miller, at nmiller@hartenergy.com.