BP board reportedly looking at CEO’s exit

Hayward’s tenure rocky after oil spill

FILE - In this Monday, May 3, 2010 file photo, BP Chief Executive Officer Tony Hayward leaves the Interior Department following a closed door meeting in Washington. BP chief executive Tony Hayward is negotiating the terms of his departure ahead of the oil company's results announcement, British media said Sunday, July 25, 2010. BP said Hayward retained the confidence of the board and management.
FILE - In this Monday, May 3, 2010 file photo, BP Chief Executive Officer Tony Hayward leaves the Interior Department following a closed door meeting in Washington. BP chief executive Tony Hayward is negotiating the terms of his departure ahead of the oil company's results announcement, British media said Sunday, July 25, 2010. BP said Hayward retained the confidence of the board and management.

— BP PLC Chief Executive Tony Hayward is discussing his departure from the company with its board after a leak at one of its Gulf of Mexico wells caused the largest oil spill in U.S. history, two people familiar with the matter said Sunday.

Robert Dudley, the U.S. director of BP’s oil-spill-response unit, is the person most likely to succeed Haywa rd a f te r a hand-over period, one of the people said. An announcement may be made Tuesday, when the London based company releases its second-quarter results, the person said. The BP board meets today to “rubberstamp” the plan, the second person said. Both people declined to be identified by name because final decisions haven’t been taken.

Earlier Sunday, BP spokesman Toby Odone seemed to downplay reports about Hayward’s departure, saying he “remains BP’s chief executive, and he has the confidence of the board and senior management.”

Hayward “has the support of the board,” BP spokesman Mark Salt said by mobile phone Sunday in London.

Hayward, 53, has faced public anger in the U.S. and criticism from lawmakers over his handling of the spill that was triggered by an April 20 explosion on the Deepwater Horizon rig, which killed 11 people. The well has now been sealed, and BP plans to permanently plug it with cement next month.

While seeking to contain public anger over the environmental damage, Hayward made several gaffes, including saying he wanted his “life back” and calling the spill “relatively tiny” in a “very big ocean.” The well spewed 35,000 to 60,000 barrels of oil a day from a mile deep in the water, according to a U.S. government-led panel of scientists. There are 42 gallons in a barrel.

President Barack Obamahas said he would have fired Hayward, while White House Chief of Staff Rahm Emanuel said on ABC in June that “Tony Hayward isn’t going to have a second career in PR consulting” and criticized the CEO for taking a yachting trip.

GREW UP IN MISSISSIPPI

Dudley, 54, was born in New York and grew up in Mississippi, part of the Gulf Coast region suffering environmental and economic damage from the spill. BP on June 23 appointed him to manage its response to the leak.

He’s spent about 30 years in the oil industry, including a stint as CEO of BP’s Russian joint venture, TNK-BP starting in 2003. That job ended after disputes with Russian partners led to Dudley fleeing Russia in 2008, citing “sustained harassment” amid court battles and labor and tax inspections.


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“The fact he is American should help to keep things a little more straight-forward in his dealings with the U.S. administration,” Harper said. “Dudley’s most important task will continue to be making sure that the well is capped.”

U.S. Rep. Edward Markey of Massachusetts said in a statement Sunday, “The new leaders of BP will have an uphill climb to correct the legacy left by Hayward.” Markey, a Democrat, is chairman of the Select Committee on Energy Independence and Global Warming.

Plaquemines Parish President Billy Nungesser said Hayward’s departure will be good for BP’s image.

“I just hope they replace him with somebody who understands the situation, someone who will come down here and see what’s happening on a regular basis, someone who will communicate with us,” he said. “From the beginning it was obvious this guy was not the leader needed in this crisis.”

But other Gulf residents shrugged upon hearing the news. The oil, they said, has already done its damage.

“It doesn’t matter,” said Chris Foss, a 39-year-old boat captain from Port Sulphur. “Whatever happens with the corporate dudes is irrelevant. The only thing that matters is what they are going to do about this mess.”

U.S. Sen. Mary Landrieu, D-La., said BP’s attitude about making things right is more important than who is running it.

“BP, from I think everybody’s perspective, made a very bad mistake,” she said. “I think what the world expects from BP is an acknowledgment that something was done wrong. I think BP has a long way to go to gain the trust of the people.”

Hayward joined BP in 1982 as a geologist, and currently makes $1.6 million a year as the company’s head, according to their annual report. In 2009, he received a performance bonus of more than $3.1 million plus other remuneration, bringing his total pay package to more than $6.1 million.

The company can terminate the contracts of directors “at any time with immediate effect on payment in lieu of notice equivalent to one year’s salary,” the report says.

Hayward also would receive close to $900,000 a year upon retirement.

HOPES ON RELIEF WELL

Plugging the leaky well for good would knock one of BP’s biggest problems off the list, and the company was looking to rebound Sunday from the shutdown forced by Tropical Storm Bonnie.

A drill rig was expected to reconnect about midnight to the relief tunnel that will be used to pump in mud and cement to seal the well, and drilling could resume in the next few days.

Completion of the relief well, which is the best chance to permanently stop the oil, now looks possible by mid-August, but retired Coast Guard Adm. Thad Allen, the government’s point man for the spill, said he wouldn’t hesitate to order another evacuation if there are forecasts similar to the ones for Bonnie.

Allen said officials will spend the next day determining how Bonnie, which did no real damage on shore, affected the area. Oil may have migrated north to Mississippi Sound, he said, and officials are checking to see if booms that were protecting sensitive marshlands were pushed ashore.

Experts had hoped the storm would break up and disperse the dwindling amount of oil visible on the ocean’s surface, but Rear Adm. Paul Zukunft, the Coast Guard officer supervising day-to-day cleanup, said that didn’t end up happening.

“We never had the high winds, the high sea states you get with a more slow-moving and more severe storm,” he said during a flyover with reporters Sunday afternoon.

Zukunft said aerial surveillance of the Louisiana coast Sunday found just one patch of emulsified oil.

Information for this article was contributed by Stanley Reed, Brian Swint, Mark Evans, Jim Polson, Laurie Asseo and Katarzyna Klimasinska of Bloomberg News and by Harry R. Weber, Tamara Lush, David Dishneau, Greg Bluestein, Mary Foster and Emily Fredrix of The Associated Press.

Front Section, Pages 1 on 07/26/2010

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