BP to Restructure, Create New Safety Unit

September 29, 2010

BP Plc’s incoming Chief Executive Bob Dudley ousted the oil group’s exploration and production chief following the Gulf of Mexico oil spill and promised to restructure the company to boost safety.

BP said on Wednesday Andy Inglis, the head of its upstream Exploration and Production unit under whose remit the blown-out well came, will leave the company.

Echoing a move BP made after the Texas City blast in 2005, Dudley said he was appointing a new safety guru, Mark Bly, who would ensure safe practices across the organisation.

However, Bly’s role will be stronger than previous safety chiefs, a spokesman said, because he will have representatives in each business unit that will have the authority to intervene if they feel practices are not meeting BP’s safety standards.

BP said it was also reviewing its system of incentives, which critics have said encourage managers to put profits and cost-cutting ahead of safety.

Europe’s second-largest oil company by market value said it was also splitting up its core upstream division into three units: exploration, project development and production, with the aim of fostering technical expertise.

BP’s internal probe into the disaster revealed its main representative on the drilling rig, and possibly his colleagues onshore in Houston who he may have consulted, were unable to correctly read a basic safety test.

A blow out at BP’s Macondo well caused an explosion on the Deepwater Horizon drilling rig which killed 11 men in April and unleashed America’s worst ever oil spill.

BP has laid most of the blame on its contractors, but rivals said BP’s own account of the disaster showed its practices fell short of industry standards.

BP shares traded up 2.1 percent at 414 pence at 1035 GMT.

(Editing by Dan Lalor and David Holmes)

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