New BP boss Bob Dudley announces major overhaul
Wednesday 29 September 2010
BP's incoming chief executive took the first steps in rebuilding shattered confidence in the group today as he announced plans for a new safety division with "sweeping powers".
Bob Dudley, who takes over from embattled boss Tony Hayward on Friday, said the launch of the new safety arm was part of a widespread overhaul at BP to restore trust after the Gulf of Mexico disaster.
He also announced a major shake-up of its exploration business that will see head Andy Inglis quit, as well as a review of how it manages third-party contractors and incentivises business performance.
Mr Dudley said: "These are the first and most urgent steps in a programme I am putting in place to rebuild trust in BP - the trust of our customers, of governments, of our employees, and of the world at large."
He added: "The changes are in areas where I believe we most clearly need to act, with safety and risk management our most urgent priority."
Mr Inglis's departure has been the subject of speculation, given that as head of exploration and production he was in charge of BP's operations in the Gulf of Mexico when the Deepwater Horizon well exploded.
He joined BP in 1980 as an engineer, working on various projects in the North Sea and becoming chief of staff for BP exploration in 1997.
He has been closely involved with BP's push into deepwater developments, heading up the company's Gulf of Mexico operations in 1997, and was later appointed chief executive of exploration to replace Mr Hayward when he was promoted to the top post in 2007.
Mr Dudley said changes at the company needed to go "beyond deepwater drilling".
The new safety division will be headed by Mark Bly, head of BP's safety and operations, and will have the authority to intervene in all aspects of the group's activities.
It will have expert safety staff placed throughout the company, including exploration projects and refineries.
BP is also restructuring its so-called upstream business into three divisions and scrutinising how it manages contractors, which bore much of the blame in the group's internal report into the Gulf tragedy.
And there will be a complete rethink of bonuses and rewards at the group to focus more on delivering better safety and risk management.
Mr Dudley said in a message to staff: "This is a deeply challenging time for BP. The Macondo incident was a tragedy that claimed the lives of 11 people, caused injury to many others and had a widespread environmental impact.
"Our response to the incident needs to go beyond deepwater drilling. There are lessons for us relating to the way we operate, the way we organise our company and the way we manage risk."
The Deepwater Horizon oil rig blew up on April 20, causing the worst spill in US history.
The group has faced scathing attacks for its handling of the crisis and investigations are continuing into the cause of the disaster and if BP is solely to blame.
Mr Hayward announced his departure in July after he took much of the criticism and following a series of PR gaffes that inflamed anger in America.
BP chairman Carl-Henric Svanberg said today: "I recognise there are still difficult challenges ahead. But we have assembled a strong and able new team and are developing a robust strategy to deal with them."
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