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Sunday Telegraph: Hayward takes up Browne’s ‘green’ baton

Sylvia Pfeifer,
Last Updated: 12:03am BST 03/06/2007

Tony Hayward, the new chief executive of BP, will tomorrow back the oil giant’s high-profile slogan “Beyond Petroleum” in a speech to world and business leaders in Berlin ahead of the G8 summit.

In his first major speech since taking over from Lord Browne, Hayward is expected to make it clear that the company is committed not just to the slogan but also to its $8bn (£4bn) investment in alternative energy.

Both are closely associated with Browne’s 12-year reign which ended abruptly in May when he resigned after admitting that he had lied over a gay relationship.

There had been speculation that Hayward might decide to ditch the slogan as a way of distancing himself from his predecessor.

Browne won plaudits when BP became the first oil company to commit to action on climate change in 1997.

But more recently, the yellow sunburst logo and eco-friendly image have come under fire as being little more than window-dressing as BP’s reputation has suffered in the wake of a string of accidents in the US, notably the Texas City refinery explosion in 2005 which killed 15 people.

While backing Browne’s legacy, Hayward is believed to be keen to stamp his own authority on BP’s strategy on climate change, focusing more on actions than policies. His speech to senior legislators of the G8, including Britain’s Prime Minister Tony Blair, is expected to set out the framework in which future decisions will be taken by the oil group. He will share a podium with Mark Moody-Stuart, the chairman of Anglo American, a big coal producer and emitter of carbon dioxide. Moody-Stuart is expected to highlight the need for an effective carbon trading mechanism as a way to drive a move to low-carbon technology.

Separately, industry executives will be watching closely for any signals from Russia’s President Putin at the G8 meeting on the fate of BP’s involvement in the massive Kovykta gas field. Russian regulators last week delayed a decision on whether to revoke its licence until after this week’s summit and the Russian Economic Forum next Sunday. The move was widely seen as a way to avoid a potentially embarrassing row.

Analysts still expect Russia’s regulator to revoke or substantially alter the licence which is held by TNK-BP, the group’s Russian joint venture, opening the door for state-run Gazprom to take control of one of the country’s largest fields. The charge against the company is that it has failed to meet the production targets set in its original licence.

According to Oleg Mitvol, the deputy head of Russia’s environmental watchdog, it should be producing 9bn cubic metres of gas a year, when it is producing only a fraction of that.

Industry executives fear the stand-off over Kovykta is simply a way for the Russian state to wrest back control of TNK-BP, possibly through Gazprom taking a stake. Putin has embarked on a re-nationalisation of the country’s vast energy assets; late last year rival Royal Dutch Shell suffered a similar fate when Gazprom took control of the giant Sakhalin field. Hayward met Alexey Milller, the chairman of Gazprom, in Moscow last week but neither company would comment on the nature of the discussions.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/06/03/cnbp03.xml 

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