Belfast Telegraph

Thursday 28 August 2014

New BP chief confident of recovery

Outgoing BP chief executive Tony Hayward, left, and his replacement Bob Dudley

BP's incoming chief executive said the Gulf of Mexico spill had been a "wake-up call" for the entire oil and gas industry.

Bob Dudley, who will take the helm from Tony Hayward in October, pledged to put the oil giant on the "road to recovery" after investors were left reeling under a 32.2 billion US dollar (£20.8 billion) blow from the disaster.

The financial hit sent BP crashing 17 billion dollars (£11 billion) into the red for the April-June period following the Deepwater Horizon tragedy - its first loss in 18 years.

US citizen Mr Dudley, who becomes BP's first overseas chief executive, insisted the company had learnt lessons from the disaster, which he said was a "wake-up call not only for BP, but the oil and gas industry overall".

On Tuesday Mr Hayward told reporters he had no major regrets about his leadership of the group since 2007 and that his decision to leave was a purely practical one but claimed he had been "demonised and vilified" over the spill. He said: "This is a very sad day for me personally. Whether it is fair or unfair is not the point. I became the public face (of the disaster) and was demonised and vilified. BP cannot move on in the US with me as its leader. Life isn't fair."

He added: "Sometimes you step off the pavement and get hit by a bus."

Mr Dudley said he did not underestimate the task ahead but added that BP was "financially robust" and boasted "enviable" assets and staff. "I believe this combination - allied to clear, strategic direction - will put BP on the road to recovery," he said.

The huge charge includes the direct costs of tackling the spill, clean-up costs for the catastrophe and a 20 billion dollar (£12.9 billion) compensation fund agreed in June. But the longer-term fall-out such as fines, penalties and potential legal action will inevitably add to the bill and spread the pain over a number of years.

BP also hopes to sell around 10% of its production assets over the next 18 months, with the aim of raising 30 billion dollars (£19.3 billion) to beef up its balance sheet to meet the crisis.

Meanwhile Mr Hayward, who drew fire for a series of PR blunders since the crisis began, leaves with a pay-off of one year's salary - £1.045 million - and an £11 million pension pot. He will remain on the BP board until the end of November and was put forward as a non-executive director of the firm's TNK-BP Russian joint venture.

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