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Rivals, white knights or Libya: who wants BP?

Channel 4 News

By Anna Doble

Updated on 06 July 2010

As BP’s future is called into question Who Knows Who investigates the potential predators, and investors, who may be poised to swoop on the beleaguered oil firm following the Deepwater Horizon disaster.

A cold wind blows for BP chief executive Tony Hayward and his chairman Carl-Henric Svanberg. More than two months since the Deepwater Horizon explosion in the Gulf of Mexico, oil continues to gush into the sea.

BP’s name is mud. The mud, on beaches in Louisiana, Florida, Alabama, Mississippi and Texas, is blackening by the day.

Hayward, nicknamed the “most hated man in America”, has been pounded with criticism – from environmental groups to US senators and most notably from President Obama who has vowed to “make BP pay”.

BP boss: who knows Tony Hayward?

The firm’s shares have taken a beating. Talk of a hostile takeover is bubbling up amongst the tar balls.

Rivals ExxonMobil, Total and Shell are all potential predators, so who might be moving in on BP’s increasingly murky waters?

ExxonMobil boss Rex Tillerson joined the firm in 1975 as a production engineer. He rose through the ranks of Exxon, working for a time in Russia, and continued his ascendancy after the firm’s merger with Mobil in 1999.

Tillerson, who became CEO four years ago, went to school in Texas – one of the US states hit by the BP spill in recent weeks.

The other CEO’s who may be reaching for the phone are the impressively moustached Frenchman Christophe de Margerie, boss of Total since 2007, and Peter Voser, who is Swiss, who took over at Shell in July 2009.

China’s PetroChina may also be sniffing an opportunity. Russia’s Gazprom could also be in the frame.

But BP is believed to be casting around for new investors to get on board, a “white knight” to ward off a hostile grab. Executives have reportedly held talks with a number of sovereign wealth funds including Abu Dhabi, Kuwait, Qatar and Singapore. A United Arab Emirates official spoke to Reuters under condition of anonymity and said: “It’s BP that is approaching the sovereign wealth funds not the other way round. They are the ones in need of a partner.”

Government of Singapore Investment Corp already owns around 0.7 percent of BP via a £122m share holding. Another possible suitor is the Kuwaiti Investment Authority.

Shokri Ghanem, chairman of Libya’s national oil company, has expressed an interest, describing BP shares as “good value for bargain hunters”.

Ghanem, who has spent time in London as an academic visitor to the School of Oriental & African Studies (SOAS), must surely know a good deal when he sees one. According to data from Opec, he previously served as director of foreign trade at Libya’s economic ministry and as director of energy studies at Tripoli’s Arab Development Insititute. In 1984 he published a book called The Petrochemical Industry in the Arab World.

However any such deal between BP and a sovereign nation would rattle shareholders, certainly if a state-owned fund were to be offered a cut-price deal for blocks of shares.

And of course it is not just BP wading through this crisis. Anadarko Petroleum is a 25 per cent partner in the well at the centre of the disaster, while Japan’s Mitsui Oil Exploration Company has 10 per cent.

BP has demanded that both pick up part of the bill for the Gulf clean-up operation.

Anadarko’s chief executive is James T Hackett, a well-known name in the oil business. He also serves as a director of Halliburton, the engineering firm which was pumping cement into the Deepwater drill-hole prior to the explosion. Notably, former vice-president Dick Cheney (who served under George W Bush) was chief executive at the firm from 1995-2000.

On 18 June, Hackett issued a statement on the Deepwater catastrophe. He said: “The events surrounding the Deepwater Horizon explosion represent a terrible loss for the families of those who lost their lives and an unprecedented environmental tragedy.”

He added: “We recognise that ultimately we have obligations under federal law related to the oil spill, but will look to BP to continue to pay all legitimate claims as they have repeatedly stated that they will do.”

But Anadarko has been accused of “shirking its responsibilities” by BP, which may sue Hackett’s firm for its share of the clean-up costs. The rig itself was leased to BP by Transocean.

A continued row could have massive financial implications for everyone involved, leaving the door open for a predator to swoop.

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