UPDATE 1-Rosneft kicks off Russian oil's London charm offensive

* Energy ministry, LUKOIL to meet investors this month

* Sechin declines comment on potential BP deal

* Refinery spending of $25 billion announced

(Adds announcement of refinery capex)

LONDON/MOSCOW, Oct 5 (Reuters) - Rosneft ChiefExecutive Igor Sechin met investors in London on Friday,launching a charm offensive by Russia's oil industry, which istrying to court foreign capital after a decade in which itbecame almost synonymous with resource nationalism.

An end to rapid gains in oil prices and domestic crudeproduction in the past three years has pushed Russia's energycompanies into the arms of foreign investors, to meet theirexpanding needs for capital and technology to revive outputgrowth.

Sechin's gatherings with London fund managers preceded asimilar meeting by oil minister Alexander Novak, scheduled forTuesday, and investor meetings by LUKOIL , Russia's No.2 oil producer, later in October.

A source familiar with Sechin's remarks said the RosneftCEO, an ally of President Vladimir Putin of more than 20 years,declined to answer questions about Rosneft's interest in BP's

50 percent stake in a Russian rival, TNK-BP .

Rosneft has said it wants to buy BP out of TNK-BP and isseeking as much as $15 billion in debt funding, bankers havesaid.

BP could then reinvest part of the proceeds in a sizeableequity stake in Rosneft itself, both companies have said.

But BP is obliged to negotiate in good faith untilmid-October with its partners, a quartet of Soviet-bornbillionaires who have also expressed interest in buying out BP,leaving talks on any strategic deal effectively on hold for now.


Instead, discussion focused on the cost of plans to upgradeRosneft's refineries, which risk falling short of rising Russiandemand for gasoline and currently produce fuel that lagsEuropean emissions standards.

Investors are wary of more heavy spending at Rosneft, whichfaced large outlays in recent years to launch new crudeproduction. Sechin said Rosneft would spend $25 billion tomodernise its Soviet-built refineries.

Sechin said $7 billion had already been spent. The remaining$18 billion would be spent over the next five years.

Spending needs for a Venezuelan crude venture, Carabobo 2,were also discussed, two sources familiar with Sechin's remarkssaid.

In tow was an executive from the Moscow office of ExxonMobil, which sealed a landmark Arctic drilling and shaleexploration venture with the Russian state company last year.

Exxon CEO Rex Tillerson, who has accompanied Sechinpersonally when the Rosneft CEO made strategy presentations tothe Kremlin in recent months, has praised "political leadership(and) policy partnerships" with Russia as a model for the restof the world.

The Exxon deal and subsequent pacts with Eni andStatoil , sealed when Putin was prime minister andSechin was his deputy, were aimed in part at securing Sechin'srole as the industry's top dealmaker.

Russia's energy minister, Alexander Novak, told theFinancial Times that licenses to drill in Russia's Arcticwaters, currently the exclusive preserve of state oil companies,could eventually be co-owned by foreigners.

A source close to Rosneft said Sechin was also aiming toshowcase the work of a presidential commission on energy chairedby Putin. Sechin is secretary of the commission, his only formalpolicy role since leaving the government.

He has clashed openly with Arkady Dvorkovich, his successorin the government of Prime Minister Dmitry Medvedev, inparticular over plans to privatise Rosneft and other key energycompanies.

Both men say, however, that they are reluctant to seeRussian energy companies privatised at low valuations.

(Reporting by Melissa Akin and Vladimir Soldatkin; Editing byDavid Holmes and Dale Hudson)

((melissa.akin@thomsonreuters.com)(+7 495 775 1242)(ReutersMessaging: melissa.akin.thomsonreuters.com@reuters.com))