Re Agreement

BP PLC
2 August 2001


BP WELCOMES RETURN OF CHERNOGORNEFT
ASSETS TO SIDANCO

The following press release has been issued today by BP in Moscow.

BP is pleased to announce it has signed a Memorandum of Understanding (the
MOU) with Novy Petroleum (owners of the TNK Group), for the return to Sidanco
of the assets formerly held by its Chernogorneft subsidiary.

The MOU expands on the Heads of Agreement of December 1999 between the Sidanco
shareholders and Alfa - TNK, and follows the more recent agreement reached
between certain affiliates of Interros Holdings (Interros) and Novy and
several companies associated with Novy, for the acquisition by Novy of a 44
per cent equity interest in Sidanco.

The MOU outlines the arrangements under which BP will retain its 10 per cent
equity interest in Sidanco and will continue to lead the management of the
holding company and its subsidiaries. It also provides for Novy representation
on the Sidanco management team. It sets out terms and conditions under which
BP's equity and management interests will be assured. Once completed this
transaction will considerably increase Sidanco's financial and production
base. Sidanco production will about double to approximately 330,000 barrels a
day.

BP's Group Vice President, Upstream, Mr Ralph Alexander said: 'Securing the
return of the Chernogorneft assets to Sidanco has been an important issue for
BP and  Sidanco for some time. This agreement now provides the commitment and
the terms under which that will happen; so it is a very positive development.
We anticipate closure of this transaction in a matter of days. A financially
strong and well-run Sidanco has been crucial in getting the assets returned.
Sidanco is a better managed company than ever before. It has been returned to
robust health and will now have the materiality to again become a leading
domestic player in Russia.'


Notes to Editors:

1.      Novy Petroleum owns Tyumen Oil Company (TNK). In turn Novy Petroleum
        is owned by Alfa Group (50 per cent), Access (25 per cent) and Renova   
        (25 per cent).

2       BP is one of the largest foreign investors in the Russian Federation
        with total investments to date of over $1.5 billion. Principal BP       
        interests in Russia are:

*       A 10 per cent equity interest in OAO Sidanco

*       A 28 per cent equity interest in RUSIA Petroleum, following license
        unification.

*       A 14 per cent equity interest in Caspian Pipeline Consortium ( owned
        through LukArco), which translates to BP financing 28 per cent of this
        internationally important pipeline project designed to connect the      
        Tengiz oil field in Western Kazakhstan to the Novorosisk marine terminal
        on the Russian Black Sea coast.

*       A network of 31 world-class gasoline retail stations in Moscow.

*       Joint bidding agreements with Rosneft and Sakhalinmorneftegas for the
        potential exploration of Sakhalin 4 and 5.

*       Established, successful and growing Oil Trading and Lubricants
        businesses.


Further enquiries:

Peter Henshaw, BP in Moscow:  +(7)095 787-6009



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