BP CEO talking departure en route to pricey pension

The Sunday Times reports that Tony Hayward will likely leave the oil giant after the leak gets sealed

Published July 25, 2010 5:25PM (EDT)

BP chief executive Tony Hayward is negotiating the terms of his departure ahead of the oil company's results announcement, British media said Sunday. BP said Hayward retained the confidence of the board and management.

Citing unidentified sources, the BBC and Sunday Telegraph said detailed talks regarding Hayward's future had taken place over the weekend. The BBC said a formal announcement on Hayward's exit is expected in the next 24 hours; the Telegraph said it would be made in the next 48 hours.

The Sunday Times reported directors are "considering a plan under which (Hayward) would leave as soon as the ruptured well is sealed."

Hayward, 53, has come under heavy criticism for his leadership following the April 20 fire and explosion on the Deepwater Horizon in the Gulf of Mexico. He has repeatedly apologized and expressed sorrow for the oil leak, but in May, he shocked some U.S. residents when he said "I'd like my life back," and weeks later went yachting.

BP is due to release its second quarter results on Tuesday, and the board of directors is scheduled to meet before the earnings announcement.

Asked about the reports, company spokesman Toby Odone said, "Tony Hayward remains BP's chief executive, and he has the confidence of the board and senior management."

Robert Dudley, who is currently heading the effort to clean up the Gulf Coast, is mentioned by many as Hayward's likely successor. Dudley is currently BP's managing director, and grew up partly in Hattiesburg, Mississippi. He spent 20 years at Amoco Corp., which merged with BP in 1998, and lost out to Hayward on the CEO's slot three years ago.

He took over from Hayward as the point man on the cleanup in June. Last week, BP said the cost of dealing with the spill had reached nearly $4 billion, but that it was too early to quantify the eventual total cost.

Hayward joined BP in 1982 as a geologist, and currently makes 1.045 million pounds (US$1.6 million) a year as the company's head, according to their annual report. In 2009, he received a performance bonus of more than 2 million pounds plus other remuneration, bringing his total pay package to over 4 million pounds.

The company can terminate the contracts of directors "at any time with immediate effect on payment in lieu of notice equivalent to one year's salary," the report says.

Hayward has a pension pot of about 10.8 million pounds (US$17.3 million), which would pay 584,000 pounds a year upon retirement.

By Associated Press

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