The first BP AGM since the oil spill, and the first one with Bob Dudley at the helm, has come to a close. With the various disputes and controversies surrounding the company at the moment, did Mr Dudley come out of it with his reputation enhanced? And what about the other parties represented? Here is our take:
Thursday morning sees Bob Dudley’s first AGM as BP chief executive, and it is not the one he would have planned.
After taking charge last year in the wake of the Gulf of Mexico spill, the new BP CEO initially won plaudits for his plan to overhaul the company’s safety procedures.
Then came his big eye-catching move, the deal that could seal his reputation as CEO. His plan for a $16bn share swap with Rosneft would open up the Russian arctic for exploration and provide an source of revenues that could rival the North Sea.
While the international tribunal has still to give a definitive ruling on a key element of the accord – a $16bn share swap – its temporary injunctions could now have a permanent effect on BP’s ability to close the deal. The Russian TNK-BP partners headed by oligarch Mikhail Fridman are winning in their effort to block the ambitious venture.
As beyondbrics has reported, the Stockholm tribunal – which is actually three Brits meeting in London – ruled on Friday that a temporary injunction blocking the share swap should remain in place.
In the last two days, we have had two new and similar accounts of the way in which BP’s corporate culture was to blame for the Gulf oil spill.
Following hard on the heels In Too Deep: BP and the drilling race that took it down, a book by two Bloomberg reporters, which was launched last night, comes an in-depth report by Fortune magazine.
The Fortune piece finds much the same as the book (review to follow) – the focus on risky new discoveries coupled with corporate cost-cutting that characterised the company under both John Browne and Tony Hayward helped foster an environment where such an accident could happen.
The Fortune piece focuses on one thing in particular: the way in which company bosses focused on personal safety rules for staff at the expense of process rules for avoid major industrial accidents.
If anybody understands the difficulties of doing business in Russia it is BP chief executive Bob Dudley. in 2008, as head of the TNK-BP joint venture he had to flee the country in a bitter dispute with BP’s Russian partners.
Shares in BP hit a 6-month high this morning after a report that rival Royal Dutch Shell considered an opportunistic takeover bid for the UK oil group in the summer during the Gulf of Mexico oil spill.
BP’s shares were up 5 per cent to 488.85p at 10am this morning in London trading.
According to the report in the Daily Mail Shell weighed a bid while oil was still flowing into the waters of the gulf but decided against it because of the potentially uncapped legal liabilities facing BP. The paper says Shell might still bid for BP if another suitor emerges over the coming months but is unlikely to be the “first mover”.
Tony Hayward’s first interview since stepping down as CEO of BP airs on UK television tonight. And it looks like it’s going to mark another fascinating chapter in the terrible story of the Gulf oil spill.
A preview from the BBC on Tuesday presented snippets of Hayward describing just how dire the financial situation became for the company. Amongst other things, Hayward admits that banks had even stopped lending to BP before his meeting with President Obama on June 16:
Prior to the meeting, the capital markets were effectively closed to BP. We were not able to borrow either short or medium-term debt at all.
So it’s a pleasure as well as an honour to be invited to speak with you today.
It’s also humbling, not least because of the circumstances in which I stepped into this role – a tragic accident in which 11 people lost their lives and an oil spill that has impacted livelihoods, businesses and the environment.
But his message was essentially robust: we are not budging, either from the US or deepwater in general.
The energy industry continues to pore over the shake-up to BP’s safety division, which was announced yesterday, just two days before Bob Dudley takes over as chief executive.
Several, including our energy editor Sylvia Pfeifer, point out Dudley’s focus on safety is hardly revolutionary – Tony Hayward made very similar noises when he took over. Over at Fuel Fix, however, they point to a happier precedent – Exxon’s largely successful attempts to improve its record following the Exxon-Valdez accident.