“Companies like BP, one of the roles they play in the industry is working in riskier areas,” Dudley, 55 told Regal Group International sources at BP’s London headquarters recently. BP “is now going to become incredibly focused on managing the risks, for example, of deep-water. It’s not going to shy away from the risk, it’s going to get even better at it.”
Dudley, who took over from Tony Haward who was at the helm at the time of the Deep-water Horizon spill, is soon due to present his first strategy update and has said that it could take at least two years to remake the company after the worst U.S. oil spill, which is expected to cost the company $40 billion. Dudley said that it was possible that they would return to paying dividends next year, but at a lower level than prior to the spill.
“The idea of coming out in February with a massive firework around strategic direction from BP may sound exciting, but it’s not quite realistic,” Dudley told Regal Group International. “You will likely see an immediate set of steps by BP, and further ones to come in 2011 and 2012.”
He added that BP may reduce the number of countries where it produces oil and gas from the current 21 to 16 as it continues to sell assets to pay for the spill. So far, BP has already sold assets in Vietnam, Venezuela and Columbia among others and Regal Group International believes there may be plans for the firm to sell assets in Alaska’s Prudhoe Bay and Argentina’s Pan American Energy LLC.
Dudley told Regal Group International sources that it would take some time before deep-water operations returned to normal in the Gulf of Mexico after the Obama administration lifted the moratorium in October.
“It’ll take some time into 2011 for companies to get back to work,” the CEO said. “Before we go back to the work in the Gulf, even if the government said it’s okay to go back now, we are going to go through all of our operations and rigs and working processes with great, great detail. We’re not going to rush back into the Gulf.”
He went on to highlight that BP would definitely return to the area which accounts for around a tenth of its total output. “We certainly have a great set of production assets and we have opened up the lower tertiary play in the Gulf of Mexico, which is a two-decade play,” said Dudley. “That’s an important piece of exploration for BP we’re very good at. You’ll see us continue to participate in that.”
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