BP’S BELEAGUERED chief executive Tony Hayward will stand down in October and is expected to be nominated for a non-executive board directorship with TNK-BP, the group’s Russian joint venture.
The oil major is set to announce Hayward’s departure this morning and will reveal that Mississippi-born Bob Dudley, the man in charge of the oil spill clean up for the past six weeks and a former chief executive of TNK-BP, will take charge of the business.
Hayward has come under heavy criticism by US government officials and the public for his handling of the Gulf of Mexico oil spill, which is the largest crude disaster in US history.
BP’s board met yesterday evening to go over the details of Hayward’s departure and severance package. It also discussed the group’s second quarter financial results, which are expected to show up to $30bn (£19bn) has been set aside to cover the costs of the spill, creating one of the worst quarterly losses in British corporate history.
Last night BP maintained that “Tony Hayward remained BP’s chief executive”.
Lawyers have argued that Hayward, 53, who has worked for the company for 28 years, is still entitled to an £11.8m pay-off even if he joins TNK-BP’s board.
“[Hayward] is still entitled to his notice pay and benefits under his contract, so his pension pot won’t be affected,” said employment lawyer Paul Reeves at Stephenson Harwood.
It is understood that the board’s decision to replace Hayward, who has led the firm since 2007, is a bid to secure BP’s operations in the US, which currently accounts for up to 40 per cent of the group’s sales.
Since the 20 April explosion of the Deepwater Horizon rig that killed 11 people, BP’s reputation in the US has suffered from significant criticism, including an increase in public fury over a number of Hayward’s gaffes.
During that time Hayward said he “just wanted his life back” and that the Gulf of Mexico was a “big ocean” following the leak.
Robert Gibbs, a spokesperson from the White House said yesterday no matter who leads BP, the company’s obligations are to clean up the Gulf.
Gibbs said: “BP cannot, should not and will not leave the Gulf without meeting its responsibilities to plug the well, to clean up the damage that’s been caused and to compensate those that have been damaged. I think that is the most important lesson out of here.”