Hayward negotiates exit from BP

BBC business editor Robert Peston on the impending departure of BP's boss.

Tony Hayward's departure as chief executive of BP has been inevitable for some weeks (see my note of June 20, "Hayward's departure: not if, but when").

That inevitability will be crystallised imminently: Mr Hayward is negotiating the terms of his departure, I am told by a senior BP source.

An announcement that he is going is likely to be made in the next 24 hours. And the strong likelihood is that he'll be replaced by his US colleague, Bob Dudley, who has been put in charge of the clean-up operation in the Gulf of Mexico.

Why now?

Paradoxically, the bad news for Hayward is that there has been better news for BP.

It has been widely agreed on the BP board for some time that the damage to the company's reputation and finances that was caused by Macondo oil spill required a change of leadership at the top, the act of catharsis that shows the company "gets it".

But directors also felt that the sacrifice of Hayward should not happen until serious progress had been made on staunching the oil leak and until it was possible to quantify the financial cost of fixing the hole, providing compensation and paying fines.

Well in the last couple of weeks, there has been such progress: BP's results due on Tuesday will contain a provision of perhaps $30bn for the Macondo costs; and a new cap on the well has stemmed the pollution, pending the permanent sealing of the well.

So Hayward's presence, as the executive who absorbs all the opprobrium heaped on BP, is less valuable than it was. And if the moment has more-or-less arrived for BP to start building a post-Macondo future, then it also needs a new public face, a new leader.

However, what will be bitter-sweet for Hayward is that evidence has emerged over the past few days that BP was less culpable for the disaster than many of its critics believe and that the charge of gross negligence against it may not stick.

The worst outcome for BP would have been proof that it cut corners in the design of well. But as I mentioned last week, the fact that the new cap on the well has staunched the flow of oil suggests that it is robust.

UPDATE 16.48

In an informal sense, the departure of Tony Hayward was agreed by BP's directors in the past few days.

It will be ratified at a formal board meeting before BP's results on Tuesday - and, as I said earlier, Bob Dudley is expected to be named as Mr Hayward's successor.

Although Mr Hayward is being pushed out, those at the top of BP say that the imminence of his exit was in part chosen by Mr Hayward.

You can keep up with the latest from business editor Robert Peston by visiting his blog on the BBC News website.

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