Harbour Energy, the largest oil and gas producer in UK waters, is now part-owned by sanctioned Russian oligarchs Mikhail Fridman and Petr Aven. Their investment company, LetterOne, now owns nearly 15% of Harbour Energy after it completed a deal to buy German firm Wintershall DEA from chemicals giant BASF. LetterOne was a part-owner of Wintershall, and shares have been exchanged for shares in Harbour Energy.
Under the terms of the deal, LetterOne has no voting rights in Harbour Energy but will receive a share of the profits paid as dividends. Convertible shares could potentially become voting shares if the two Russians cease to be sanctioned. Most of Harbour Energy’s profits come from its North Sea assets, which produce around 200,000 barrels of oil equivalent per day.
Louis Wilson, head of fossil fuel investigations at Global Witness, a campaign group, said the UK government and Harbour should have avoided the deal due to the Russian oligarchs’ involvement and the security risks posed. Fridman and Aven were sanctioned in March 2022 after Russia invaded Ukraine, but LetterOne itself is not sanctioned.
LetterOne owns a range of global assets worth $18bn (£13.8bn), including Holland and Barrett, a health food retailer. The UK government forced LetterOne to sell a regional broadband provider, Upp, in 2022 due to concerns over national security risks. The company is appealing the decision.
A spokesperson for LetterOne said it was committed to making long-term investments in businesses that matter. They added that they were proud to be part of a bigger, stronger UK energy business that would bolster energy security, increase investment, create jobs, and help deliver the nation’s ambitious energy transition goals. Harbour Energy declined to comment on the deal
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