New BP CEO sparks protests.

by Katie Murdoch.

After setting aside $32.2bn to cover the costs of its oil spill clean-up, BP is moving ahead with its plans to improve its company image with the announcement of new CEO Bob Dudley.
Mr Dudley will be replacing current CEO Tony Hayward in October.

Mr. Dudley, 54, is currently a main board director at BP, and is a key figure in the newly-established unit which deals with the clean-up operations and compensation methods in the Gulf of Mexico.

Carl-Henric Svanberg, chairman of BP, describes Mr. Dudley as a “robust operator in the toughest circumstances” and comments that BP is “highly fortunate to have a successor of Dudley’s calibre”. The move comes after Mr. Hayward’s leadership was questioned as a result of his handling of the oil explosion off Louisiana on 20 April. The oil spill killed 11 workers and cost the company more millions in damages.

The replacement of British national Mr. Hayward by Mr. Dudley, a senior American figure in the company, has provoked questions over BP’s attempts to rebuild its reputation and image. The oil company has reported losses of over $16 billion in its second quarter, compared to its profit of over $3 billion just a year ago. Mr. Dudley is expected to enhance the company’s performance in cleaning up the damage in the Gulf of Mexico and promises to “make it right”.

Mr. Svanberg said, "The tragedy of the Macondo well explosion and subsequent environmental damage has been a watershed incident. BP remains a strong business with fine assets, excellent people and a vital role to play in meeting the world's energy needs. But it will be a different company going forward, requiring fresh leadership supported by robust governance and a very engaged board.”

On taking on his new role within the next few months, Mr. Dudley said, "I am honoured to be given the job of rebuilding BP's strengths and reputation but sad at the circumstances. I have the greatest admiration for Tony, both for the job he has done since he became CEO in 2007 and for his unremitting dedication to dealing with the Gulf of Mexico disaster."

The company expressed that the change in leadership was amicable and was reached by a “mutual agreement” by the BP board.

Mr. Hayward, 53, plans to work closely with Dudley to ensure that the transition is “smooth”, and will receive one year’s salary of over £1 million as well as an entitlement to receive £600,000 annual pension once he turns 55. Mr. Hayward is likely to continue working for BP once the new CEO takes over in October. The company has also revealed plans to nominate him as a non-executive director of its joint Russian venture, TNK-BP.

The change in leadership of BP is likely to amend the company’s relations with the US after President Obama compared the huge damage caused by the spill to the attacks of 9/11. The positioning of American leading figure Bob Dudley as the CEO of BP could help the company regenerate its image and reputation, directing the company to a greener, more internationally friendly corporation.

Green charity Friends of the Earth’s President Erica Pica said, “Corporate polluters must not be allowed to spin this tragedy as an isolated incident or pretend that the problem has been solved. Oil continues to spread, and a massive recovery effort is still required. Just as important, if not more so, is that our nation’s leaders have yet to fully address the root causes of the spill.”

Activists of environmental organisation Greenpeace have forced all London BP petrol stations to close after the announcement of the CEO replacement sparked protest. Activists used a shut off switch to stop the flow of the fuel, resulting in the immobilisation of 50 stations. Signs outside the stations erected by activists read ‘Closed. Moving beyond petroleum.’ Greenpeace argued the protests were necessary to put pressure on BP to move into a “new direction”, moving away from Mr. Hayward’s “obsession” with high risk, environmentally “reckless” sources of oil.

Greenpeace Executive John Sauven told The Fresh Outlook, “We’ve shut down all of BP’s stations in London to give the new boss a chance to come up with a better plan”. He believes that other companies all over the world are using clean energy, and that BP must follow suit in order to remain environmentally-ethical.

A BP spokesperson has responded to the protests, calling them “childish and irresponsible,” adding that the stations would be reopened as soon as it was safe to do so.

At a station in Camden, Greenpeace climbers changed BP’s logo, showing the sunflower in a sea of oil, a symbol for the destruction caused by the oil well leaks- the worst in US history. A spokesperson for the Metropolitan Police said they have not received any reports from the scene and no arrests had been made.

The oil company released the following statement regarding the progress of its clean up, “BP is doing everything we can to make this right. We continue to fight to stop the flow of oil, clean up the environmental damage, and help make sure that people are compensated for their losses. The company plans to reduce its net debt level down to a range of between 10 and 15 billion dollars within the next 18 months, a large reduction from the $23 billion at the end of June.”