A board meeting held in Paris ended on Saturday with BP and Russian-led management deadlocked over how — and indeed whether — to involve TNK-BP in a pact struck in January by BP and Rosneft to explore the Arctic offshore.

The partnership, which includes a $16 billion (9 billion pounds) share swap, marks a watershed in the development of Russia’s oil sector, with the Kremlin softening its doctrine of resource nationalism and opening the door to global energy majors.

State-controlled Rosneft, chaired by Deputy Prime Minister Igor Sechin, has described as “strategic” its alliance with BP and sees no place for TNK-BP, Russia’s No.3 oil firm, in the deal due to its lack of deepwater expertise.

TNK-BP’s shareholder managers, led by tycoon Mikhail Fridman and represented by the AAR consortium, counter that the Rosneft-BP alliance violates TNK-BP’s shareholder agreement and poses an existential threat to the company’s business.

“Having BP, which is a 50 percent shareholder in TNK-BP, become the largest private shareholder in one of TNK-BP’s main competitors would inevitably lead to conflicts of interest and new tensions,” Stan Polovets, CEO of AAR, said on Sunday.

AAR has won a London court injunction to keep the deal on hold pending an arbitration review, which TNK-BP said could be completed within weeks.

Fridman and his partners, Viktor Vekselberg and German Khan, have proposed that TNK-BP supplants BP in the share swap, paying $7.6 billion to buy 5 percent of BP which would be then exchanged for a 10 percent stake in Rosneft.

The fallout from Saturday’s board meeting centered on whether any talks on bringing TNK-BP into the Rosneft partnership would indeed involve involving it in the share swap.

“A proposal by BP’s nominated directors which would have allowed TNK-BP to hold initial discussions with Rosneft about pursuing the Arctic opportunity, was rejected by Alfa, Access and Renova (AAR),” BP said in a statement.

TNK-BP management fired back Sunday that BP’s comments were “misleading and inaccurate,” adding that the BP proposal had ruled out involving TNK-BP in the share swap.

Analysts note that, while the letter of the shareholder agreement forces BP to engage in at least a formal dialogue with TNK-BP management over the Rosneft deal, the power relations in Russia are likely to trump the UK court system.

Sechin made his views clear in that respect on Friday: “The issues of mineral resources usage fall into the Russian government’s remit. This is not a matter for the London courts,” he told Interfax news agency.

TNK-BP’s board comprises four BP nominees, four from the AAR consortium and three independents — Germany’s former Chancellor Gerhard Schroeder, Russian industry lobby head Alexander Shokhin and former Corus chief executive James Leng.

The BP nominees rejected TNK-BP’s management offer to fully replace BP in the deal with Rosneft, while saying TNK-BP can only start talks on the possibility of joining the Arctic deal.

TNK-BP, which accounts for around 10 percent of BP’s profit, said the AAR-nominated directors and three independent directors voted in favor of management’s proposal.

Saturday’s meeting ended in stalemate as unanimous agreement was required for either motion to be approved.