Embattled BP Chief Hayward Taking Back Seat in Gulf Response

BP managing director Robert Dudley, an American, takes over BP's spill response.

June 18, 2010 — -- Embattled energy giant BP appears to be shuffling CEO Tony Hayward out of the spotlight a day after the British native roiled Congress with what critics called "evasive" testimony about the massive Gulf of Mexico oil spill from a BP well.

BP Chairman Carl-Henric Svanberg said that managing director Robert Dudley will take over Hayward's role in responding to the crisis, according to a report by U.K.-based Sky News.

"It is clear Tony has made remarks that have upset people," said the Swedish-born Svanberg, who himself was the target of criticism after saying BP cares "about the small people" during a public statement apologizing for the spill.

BP is downplaying Svanberg's comments, noting that it had announced earlier this month that Dudley would lead a new organization "to manage the long-term response once the spill is over."

The spill, however, has not ended -- with some 35,000 to 60,000 barrels of oil gushing into the Gulf each day, according to the latest estimates -- yet Svanberg indicated that Dudley is taking over for Hayward now.

Dudley is one of the few Americans in BP's top ranks and received a total of $6.4 million in compensation last year, according to the research firm Equilar. Dudley joined BP through the merger with Amoco, which he had worked for since the late 1970s. Put in charge of tough assignments, Dudley was first charged with managing BP's Russian joint venture earlier this decade, and is now responsible for BP's new unit created to deal with the financial fallout of the oil spill.

BP said that Hayward, 53, will remain the company's CEO. Last year, Hayward's compensation totaled $14.3 million, according to Equilar.

Hayward has been the face of the oil spill and the explosion of the Deepwater Horizon oil rig, which killed 11 men and devastated Gulf shores. He has been excoriated in recent weeks not only for his role as head of the company blamed for the spill, but also for his public statements, including the now-infamous, "I'd like my life back," -- a comment Hayward made while explaining his desire to quickly resolve the disaster.

On Thursday, members of Congress lambasted Hayward during a hearing by the House Oversight and Investigations Subcommittee for refusing to say whether BP made dangerous and risky decisions leading up to the spill, as critics, including executives at other oil companies, have suggested.

Hayward said he would not draw any conclusions about the accident until investigations into the disaster were completed -- a statement he reiterated several times throughout the hearing, much to the consternation of the congressmen questioning him.

"You're really insulting our intelligence, with all due respect, by not giving us any answers and telling us you have to wait for some investigation," said Rep. Eliot Engel, D-N.Y.

Hayward Before the Spill

Hayward's life before the spill was an enviable one. Last year, the British native's compensation totaled $14.3 million, according to the research firm Equilar, some of which he's spent on vacations sailing through the tropics and skiing in Vail, Colo., with his wife, a former BP geophysicist, and their two children. He's also an avid sports fan and enjoys watching games of rugby, soccer and cricket.

"I don't work weekends. ... And I take all my holidays," he once told a BP publication.

But Hayward's defenders point out that while the often tie-less CEO has a noticeably laid-back demeanor, he asserted his commitment to safety long before the Gulf spill. In another past interview, Hayward recalled an incident that killed a young BP employee in Venezuela. Hayward attended his funeral, where he was confronted by the young man's mother.

"At the end of the service his mother came up to me and beat me on the chest," he said. "'Why did you let it happen?' she asked. It changed the way I think about safety. Leaders must make the safety of all who work for them their top priority."

From BP Reject to Ninja Turtle

BP's leader for more than three years, Hayward took over the company at an inauspicious time. In 2007, BP was still dealing with the aftermath of a 2005 Texas refinery explosion that killed 15 workers and a 2006 oil spill in Alaska's North Slope, its profits were plunging thanks to weak U.S. gas prices and other problems and its last CEO, the highly-respected John Browne, had resigned amid a salacious scandal: A judge had found Browne lied in court over a long-running gay relationship with a Canadian student.

While he kept mum on the Browne scandal, Hayward was vocal and aggressive in his efforts to turn around BP, both from a financial and safety standpoint. Under his tenure, BP simplified its company structure and slashed thousands of jobs -- moves that BP officials insisted did not compromise BP's increased focus on safety.

"What I learned was that we'd become far too introspective at the top. In particular, we weren't listening to the operating people on safety and reliability," Hayward told a BP company magazine in 2008. His predecessor, he said, built "a fantastic company. ... Our task now is to demonstrate that we can run it."

Hayward almost never got the chance to work for BP, let alone run it.

His beginnings were humble: Hayward was the oldest of seven from Slough, England, a blue-collar town that serves as the setting for the British version of "The Office." After he earned a degree at a midtier college, his initial application to BP was rejected.

A Ph.D. in geology from Edinburgh University prompted BP to take a second look. Hayward joined the company in 1982 at age 25, beginning his career there as a rig geologist in the North Sea, where he helped discover a new oil field.

"Drilling into the reservoir for the first time at 4 a.m. on Christmas morning 1982 (was) one of my better Christmas presents," he recalled in a speech before a Scottish oil club in 2006.

Hayward went on to work in seven different countries -- his daughter, the younger of Hayward's two children, was born in Colombia -- and hold a number of different roles. Browne took notice of Hayward at a 1990 BP conference in Arizona and Hayward soon became part of a group of young, promising executives nicknamed the "Teenage Mutant Ninja Turtles."

Enemies in America

Hayward drew from his geological expertise to help BP expand its oil reserves.

"When Hayward came in, he was felt to be a pretty good guy from the point of view of doing the most important thing that oil companies worry about: trying to find more oil to add to the reserve list," said Paul Hodges, chairman of International eChem, a London-based chemical advisory group.

Hayward continued BP's global expansion earlier this year by shepherding his biggest deal as CEO: the $7 billion purchase of assets, including off-shore oil blocks in Brazil, from a U.S. energy company in March.

Hayward knows that BP can gain an edge over smaller energy companies through big, complex international projects, said David Aron, the managing director of London-based Petroleum Development Consultants.

Aron, who has worked with BP in the past, said that Hayward's willingness to admit shortcomings may ultimately hurt him the eyes of the American public, particularly those accustomed to hearing from less modest CEOs. Hayward recently admitted that BP "did not have the tools you would want in your tool kit" to cope with the Gulf disaster.

"It's actually true, but maybe it's not the thing to say to an American audience," Aron said.

Hayward made enemies in the United States a month before the Deepwater Horizon explosion, when he criticized the continued construction of coal plants in a speech before a D.C. think tank. Hayward said Congress should promote natural gas use, which emits less carbon than coal.

In response, the United Mine Workers of America called for a boycott of BP, which is one of the world's largest natural gas producers. In a message sent to its members, the labor union said Hayward was "advocating putting an end to coal, the jobs that go with it and the retiree pensions and health care that coal pays for."

Today, the adversity Hayward faces is wider-ranging and, from his family's point of view, more frightening. The British media has reported that local police have launched an operation to protect the Haywards after the family was targeted with hate mail and upsetting phone calls.

"Members of my family have had nasty phone calls and we have also had mail from groups," Hayward's wife, Maureen, told The Daily Telegraph. "Tony is obviously away and we are miles away from him so it's upsetting."

It's unclear whether Hayward will be able to weather the fallout from the Gulf disaster with his job intact.

Phil Weiss, a senior energy analyst at Argus Research, said he believes Hayward will be shown the door once the spill is contained.

"One of the things people thought he was going to do was to help clean up the company's operations and make it safer," Weiss said. "And yet here we have the biggest environmental disaster in U.S. history under his watch. ... It doesn't sound to me like he's done what he was expected to do."

ABC News' Andrew Miller, Daniel Arnall and Dalia Fahmy contributed to this report.