BP reinvents itself after record loss

New Orleans: BP officials say they are beginning to reinvent a company that reported a record $17 billion quarterly loss and is navigating the politically fraught task of making the Gulf of Mexico new.

The company named its first American CEO on Tuesday during its quarterly earnings call, while its outgoing chief, who has been repeatedly criticised for other verbal miscues, miffed the White House anew on his way out.

Robert Dudley, who will replace Tony Hayward on October 1, promised changes in light of the environmental disaster.

"There's no question we are going to learn things from this investigation of the incident," he said.

One certain change is that BP will become smaller. It announced it will sell $30 billion (Dh110.17 billion) in assets and has set aside $32.2 billion to cover costs from the largest offshore oil spill in US history.

Dudley, BP's managing director and current point man on oil spill recovery, defended the record of his company and his predecessor.

Hayward will leave BP with benefits valued at more than $18 million. He told reporters he had been "demonised and vilified" but had no major regrets about his leadership.

"Life isn't fair," he said, but he conceded that wasn't the point. "BP cannot move on in the US with me as its leader."

The White House was not impressed with Hayward's comments.

"What's not fair is what's happened on the Gulf," press secretary Robert Gibbs said. "What's not fair is the actions of some have caused the greatest environmental disaster that our country has ever seen."

BP announced the move nearly 100 days into a catastrophic mile-deep blowout that killed 11 workers, spewed 94 million to 184 million gallons of oil and sapped 35 per cent, or $60 billion, of BP's market value.

"We are taking a hard look at ourselves, what we do and how we do it," BP Chairman Carl-Henric Svanberg said.

Svanberg said the company's priority was to stop the Gulf leak permanently, clean up the spill and compensate people whose livelihoods have been lost. But he added that the company was determined to restore value to shareholders, whose dividends were axed by BP under US political pressure.

Company shares dropped 65 cents (Dh2.38), or about 1.7 per cent, to close at $38 in Tuesday trading in New York.

BP said it would become a leaner, higher-quality business through its planned sale of $30 billion in assets. The company has already made a start with the $7 billion sale of gas assets in the United States, Canada and Egypt to Apache Corp.

Svanberg said the planned asset sales did not necessarily reflect a fear that spill costs could soar above the $32.2 billion set aside by the company.

Analysts were disappointed that BP intended to sell so many assets.

Oppenheimer & Co. analyst Fadel Gheit said BP should be a 10 per cent smaller company after its planned sales but that BP should remain the top oil and gas producer in the US, unless it sells off a large portion of its Alaska assets. The company was reportedly considering the sale of its stake in the Prudhoe Bay oil field to Apache Corp., but instead sold Apache properties in Texas and New Mexico, as well as Egypt and western Canada. The US is home to 40 per cent of BP's assets and one-third of its worldwide oil and gas reserves.

Prior to the Gulf incident, BP said its exploration activities were focused around Angola, Egypt, the deepwater Gulf of Mexico, Libya, the North Sea, Oman and onshore US.