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The Times: Hayward to present his plans for BP reshuffle

May 3, 2007
James Harding

Tony Hayward will present his plans for a reshuffle of the top team at BP when he attends his first board meeting as chief executive in Washington next week.

After the traumatic departure of Lord Browne of Madingley on Tuesday, at the end of a year of deteriorating morale at one of Britain’s biggest companies, Mr Hayward is looking to refresh the executive leadership and reassert a focus on safety. Mr Hayward’s first week in the chief executive’s job is expected to include a meeting with President Bush in the US capital.

The plans for executive changes will stoke expectations that John Manzoni will be removed from his present job as chief executive of BP’s refinery and marketing, the division responsible for the Texas City refinery, where 15 people were killed in an explosion in 2005 that exposed systematic safety failings across the company.

Byron Grote, the respected finance director, who will reach retirement age next year, is expected to continue in his present role. The management culture at BP is also expected to change after the exit of Lord Browne, who, in the past couple of years, has been criticised quietly within the company for amassing too much power, listening less to contrary opinions and staying too long in the job.

In his presentation to the board, Mr Hayward will also emphasise continuity with key strategies set down by Lord Browne. Among other things, BP will remain a British company. BP has mulled the idea of moving its domicile from the UK to the US, but concluded that, regardless of the arguable tax benefits, it would lose its status as a flag-carrying energy company, for ever eclipsed by Exxon Mobil. Mr Hayward also is said to be committed to BP’s joint venture in Russia.

The mood at BP yesterday was said to be sad and angry, as employees dwelt on the circumstances of Lord Browne’s resignation and fumed at the treatment that he had experienced at the hands of the British press. After 41 years at the company, Lord Browne resigned on Tuesday after it emerged that he had lied to a court in his efforts to keep The Mail on Sunday from publishing the details of a relationship with Jeff Chevalier, his former lover.

Lord Browne is understood to have been inundated by e-mails and other messages of support. BP is planning a series of grand farewell parties for him in June and July.

Business big shot: Tony Hayward

Life must have seemed that bit lonelier for Tony Hayward yesterday as he began his career as chief executive of BP with a series of meetings he was originally scheduled to attend with Lord Browne of Madingley.

Little could the 49-year-old have guessed how dramatic the turn of events would be when the date to fly to Brussels and on to BP’s office in Bochum, Germany was originally put in the diary.

In reality, Mr Hayward has been running the business as chief executive for much of the past month as part of a handover process agreed with his long-term mentor and close friend, back in January.

When it was decided at the start of the year that Lord Browne would step down in July, Mr Hayward, as his hand-picked successor, began a three-month period shadowing the boss.

They swapped roles after BP’s annual meeting in April with Lord Browne in place to shadow his apprentice until he formally left the business.

Yesterday’s sudden promotion means that Mr Hayward has not even been able to e-mail staff, but it is something friends claim he will want to rectify as soon as he returns to London.

Raising morale and lifting the gloom at BP are likely to be high on the agenda for the man who has spent his entire career at BP since leaving Edinburgh University with a first class geology degree and a PhD in 1982.

It was nearly very different. Only a phone call from David Jenkins, BP’s chief geologist, convinced Mr Hayward to choose the company over his initial preference, US rival Mobil.

Of the change of heart, Mr Hayward explained: “I was really impressed that a senior person at BP made the effort to phone. I felt it reflected really well on the company and I changed my mind. It was a good decision.”

Mr Hayward then embarked on a journey of BP’s various outposts in technical and commercial capacities, moving from Aberdeen to France, Canada, Indonesia and China.

One industry executive who worked with him at BP’s South China Sea project in the mid1980s recalled him as “very impressive, very aware of appearances and how he was perceived, and very likeable”.

He added: “While you couldn’t at that stage tell he was going to go right to the very top you knew he would do well.”

Mr Hayward first met Lord Browne at a leadership conference in Phoenix, Arizona in 1990.

He returned to work in America and then on to Colombia where his daughter Tara was born and his son Kieran learnt to speak Spanish.

Much of his personal life is spent sailing with the two children and his wife, Maureen, watching England’s rugby team at Twickenham or following the fortunes of West Ham.

He spent six months as one of Lord Browne’s ‘turtles’, following the chief executive through every hour of his work. “It was the ultimate learning experience,” he said.

Mr Hayward returned to London as group vice-president of BP Exploration in 1997 and played a key role in the takeovers of Amoco and Arco that helped to turn BP into one of the industry’s “Three Sisters” alongside Exxon and Shell.

He then moved rapidly through the executive ranks, joining the upstream executive committee in 1999, becoming group treasurer in 2000 and finally chief executive of BP’s enormous Exploration and Production business, like Lord Browne before him, in 2002. (Steve Hawkes)

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