LONDON: A Russian state firm has offered to buy BP's half share in its Siberian joint venture, a source said yesterday, in what would amount to a stunning reversal for the British firm and a bold assertion of Kremlin control over the oil sector.

If a state entity acquires the stake, worth around $30 billion, it would signal a dramatic reorganisation of Russia's oil industry, the world's largest, weeks after Vladimir Putin returned to the presidency.

State oil major Rosneft chief executive Igor Sechin denied considering buying out the stake in the TNK-BP joint venture, which accounts for nearly a third of BP's output and has since 2003 been a cornerstone of its global strategy.

But two sources said Russian state energy holding company Rosneftegaz - which controls Rosneft - could serve as a vehicle to do the deal. "(Sechin) will try to buy this part through Rosneftegaz or another instrument," a source close to Rosneft said.

Selling out would cut BP loose from hostile partners and free it from an investment that had restricted its ability to pursue other opportunities in Russia.

BP did not say who had made what it called "unsolicited approaches" to buy the stake, but a source close to the matter said one of Russia's state-owned oil and gas firms was involved.

A source close to Gazprom said he was not aware of any approach. Kremlin-friendly Surgutneftegas, whose $28bn cash pile could back a deal, declined comment.

TNK-BP is Russia's No 3 oil producer and BP's stake is one of the biggest foreign investments ever made in the country. It has earned BP huge profits, but has long been plagued by legal battles between BP and its Russian partners, the AAR consortium of billionaires.

For BP, selling out would mean giving up annual dividends which hit $3.7bn last year and losing around 30 per cent of its oil and gas production, but would give it a cash pile to explore higher-growth ventures, perhaps even in Russia.

Given the Kremlin's desire to exert influence over the oil sector, analysts and bankers pointed towards state-backed players as the most likely buyers.