BP Chief Executive Hayward Has Full Backing of Board, Refining Head Says

BP Plc Chief Executive Officer Tony Hayward has the backing of the board and is not about to resign, according to Iain Conn, the oil company’s head of refining and marketing.

Hayward has faced public anger in the U.S. and attacks from lawmakers over BP’s failure to halt the worst oil leak in U.S. history in the Gulf of Mexico. Yesterday, Russia’s Deputy Prime Minister Igor Sechin said Hayward was planning to stand down and announce a successor. BP denied the CEO would quit.

“What happened in Russia was a misunderstanding,” Conn said today in an interview in Oxford, England. “Tony is leading this company in a very strong and robust way. He’s a remarkably resilient person and he has our full support.”

BP has lost 54 percent of its market value since the April 20 explosion aboard the Deepwater Horizon drilling rig that killed 11 crew members and caused the spill. The company has agreed to deposit $20 billion in an independent account to pay for Gulf restoration and compensation claims as rising costs associated with the spill spur ratings downgrades and concern over its future.

BP needs to remain a “strong and viable” company to fund all its commitments arising from the spill, Conn said. “I’m very encouraged by the administration, the alignment now that we need to stop this and mitigate the damage done to the people of the Gulf Coast.”

Recovery Rate

BP recovered about 11,070 barrels of oil from the leaking well in the first 12 hours of yesterday, according to an update on its website. It captured 24,450 barrels of oil on June 27. The company has spent $2.65 billion to date on trying to clear up the spill, and on grants and claims and other costs.

“BP’s focus is absolutely on one thing, which is to stop this leak and to clean up the mess and do the right thing by the people of the Gulf coast,” Conn said. “I know we’ve come in for a lot of criticism but that commitment is absolutely genuine.”

It’s not yet clear where all the blame lies for the leak, according to Conn.

“We clearly have a share of responsibility and we’ve taken it,” he said. “We’ve been absolutely public about that. Maybe BP is not 100 percent responsible, but right now we are just doing what we believe is the right thing.”

BP is also drilling two relief wells to permanently seal the leak that are scheduled to be completed next month.

‘Good Progress’

“We are making good progress,” Conn said. “This process slows the closer you get because we’re ranging, finding the well, drilling ahead, checking drilling, again. It’ll take time and we want to get it right.”

The boycott of BP goods in the U.S. is starting to hurt “to some degree,” Conn said. “The outrage expressed is understandable. It’s a deeply devastating thing for a company that has been so committed to safety and the environment, especially in the last few years, for this to happen.” He couldn’t put a figure on losses arising from the boycott.

Conn hoped that BP’s actions in trying to clear up the spill under the leadership of Robert Dudley in the U.S. will help to “demonstrate just how committed we are to doing the right thing.”

Planned asset sales to raise cash for the $20 billion fund will mainly be drawn from exploration and production, Conn earlier told the World Forum conference on low carbon mobility. BP can meet all of its obligations, he said.

To contact the reporter on this story: Brian Swint in London at bswint@bloomberg.net;

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