During a battle for control of BP’s Russian joint venture with a group of billionaires two years ago, Dudley survived raids by Vladimir Putin’s secret service, overcame bureaucratic hurdles that barred employees from attaining work permits and outlasted a no-confidence vote, all before being forced to leave the country. As head of drilling in Africa, he oversaw Angola, where BP now produces from 11 deepwater fields.
That experience may benefit the former Mississippi resident and 30-year oil industry veteran when he accompanies BP Chairman Carl-Henric Svanberg to the White House tomorrow, as criticism mounts from President Barack Obama over the company’s handling of the disaster. Concern that the cost of the cleanup operation and future liabilities could spiral out of control has seen BP’s market value slump by 45 percent. BP fell 3.8 percent to 342 pence in London, the lowest price since April 1997.
“He fits the new job as he had worked in very difficult conditions in Russia,” said Ivan Mazalov, who helps manage about $4.5 billion at Prosperity Capital Management in Moscow and remembers Dudley from his stint in Russia. “He is super calm.”
Day to day control for dealing with the crisis was given to Dudley earlier this month after a series of missteps by BP Chief Executive Tony Hayward, which led to him being labeled “the most hated -- and clueless -- man in America” by the New York Daily News. A U.S. citizen in charge may help limit further damage to BP’s reputation, said Greg Smith, U.K. managing director of Fat Prophets, a stock market research firm.
“Hayward has been cast as a sort of stiff upper lip Brit, and he hasn’t handled it well in terms of the PR side,” Smith said. “Dudley, as an American, adds extra strength.”
Dudley, 54, who was born in New York and grew up in Mississippi, served as one of former BP CEO John Browne’s executive assistants, a position that traditionally leads to bigger roles. Browne wrote in his memoir of how his assistants were known as “Turtles” after the Teenage Mutant Ninja Turtles, because of “their speed and ability to appear whenever they were needed.”
Dudley ran Amoco Corp.’s Russian operations from 1994 to 1997, before its 1998 acquisition by BP. Before running TNK-BP, Dudley oversaw BP’s exploration and production across Russia, the Caspian, Angola, Algeria and Egypt.
“I don’t believe we could have a better person to lead this organization,” Hayward said of Dudley’s role in heading the unit that will take responsibility for the spill, as well as rebuilding the BP brand.
Given his roots, growing up in Hattiesburg about 80 miles north of the Gulf Coast and spending summers in Gulfport and Biloxi along the water, Dudley said the damage caused by the spill hit him hard.
“What I saw was painful and emotional, and shocking,” Dudley said after a trip to Louisiana last week.
Rising public anger and attacks from U.S. lawmakers over Hayward’s failure to halt the leak led to speculation that he may be forced to quit, and Dudley’s name emerged as a possible successor.
“Dudley is a safe pair of hands, and people should be encouraged by that,” said Dougie Youngson, an analyst at Arbuthnot Securities Ltd. in London. “If he does a great job in managing the unit, there’s no reason he can’t go to the top.”
Dudley has been a regular on the U.S. television circuit since the early days of the crisis, defending the company’s strategy, and has also sought to spread BP’s message to a business audience.
“Operating at the frontiers of any industry is risky, and it is that trade-off that governments, people, and industry will make together,” he told executives in Boston on May 6.
Asking reporters at the same event to believe that BP had submitted appropriate risk-management plans, Dudley said he had seen the documents, gesturing they were about four inches thick.
Dudley’s latest role will put him in front of the world’s media, a spot he last encountered as head of BP’s TNK-BP unit in Russia between 2003 and 2008.
BP’s Russian partners called for Dudley’s dismissal in 2008 in a dispute over strategy at Russia’s third-biggest oil company, alleging he ignored their interests. He denied the charge.
Workers seconded by BP were barred from working in Moscow, while the successor to the Soviet KGB raided its office and an employee was charged with industrial espionage. In the end, Dudley fled the country, citing “sustained harassment” amid court battles and labor and tax inspections.
Dudley continued to run the unit from an undisclosed location, only stepping down as part of a settlement between the factions in September 2008.
His efforts in Russia were rewarded with a place on BP’s board and the appointment as managing director for government relations and non-operational matters in the Americas and Asia.
“If Dudley survived what he survived in Russia, he should be good at this,” Christine Tiscareno, an analyst at Standard & Poor’s in London, said of his new job. “And he’s American so he may understand cultural innuendos that others wouldn’t.”