By Sylvia Pfeifer, Deputy Business Editor
Last Updated: 12:10am BST 14/10/2007
Tony Hayward, the new chief executive of BP, has pledged to turn around the oil giant’s fortune in the next two to three years. In an interview this weekend, Hayward told The Sunday Telegraph that “we have been on the downward spiral for three or four years and it will take us two or three years to come back up”.
He said: “This is going to be step by step. It’s not whiz-bang fireworks today, everything is fixed. It is step by step over two to three years, but we have going for us a bit of a revenue wave from the stuff that is coming in so we will see if we can pick the wave.”
His target is likely to be seen as ambitious by rival industry executives. BP’s fortunes have been hit by a series of accidents, notably the Texas City refinery blast two years ago which killed 15 people. Its share price has underperformed that of its peers for the past few years.
Hayward, who took over from Lord Browne in May, set out his vision for the oil giant last week. “We are not making as much money as we should be… we have not got our kit running.”
One of the recent setbacks for BP has been in Russia, which contributes about 10 per cent of BP’s annual profits. The company’s Russian joint venture, TNK-BP, had to sell its stake in the Kovykta oil field to Gazprom, the state-controlled energy giant. The sale was seen as the latest example of the Kremlin forcing out Western energy companies. As part of the deal the companies agreed to set up a joint team to identify strategic opportunities for investment. Analysts have been sceptical the venture will lead to anything material for BP. Hayward said the oil giant was still negotiating a potential asset swap and he was “optimistic” something would happen, “probably before the middle of next year”.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/10/14/cnbp114.xml
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