BP Plc (BP/), the second-largest European oil company, is safer and stronger more than two years after a blowout at a Gulf of Mexico oil well caused the worst offshore oil spill in U.S. history, the company’s chief executive officer said.
“We alone stepped up from the outset, acknowledging our role, waiving the liability cap and committing ourselves to help restore the environment and economy of the Gulf Coast region,” Robert Dudley said in a speech at the IHS CERAWeek conference in Houston. “We are honoring our commitments.”
Dudley, who took the helm six months after BP’s Macondo well disaster in April 2010, has sought more profitable opportunities to help reverse production losses stemming from $38 billion in asset sales used to help pay legal claims. BP is facing as much as $17.6 billion in fines and additional billions in unspecified punitive damages in a U.S. federal trial that began Feb. 25 in New Orleans.
“We are vigorously defending the company, but we are determined to make our case in the courtroom and not in the press,” he said. “We believe the law and the facts are on our side.”
The blast, which killed 11 workers, so far has cost the London-based company a total of $24 billion in claims, penalties and clean-up costs. BP has spent or provisioned more than $40 billion, Dudley said.
BP plans to spend $4 billion a year in the U.S. Gulf of Mexico for the next 10 years, part of a growing focus on the U.S., where the company has invested $55 billion in the past five years, more than in any other country, he said. The company also remains committed to investing in Russia, where there’s “enormous scope” for increasing production, he said.
“After decades of false starts, the U.S. seems to have hit upon a successful energy policy mix, and Russia is well on its way,” he said.
Dudley engineered the biggest oil industry deal in more than a decade when the company sold its stake in Russian producer TNK-BP to OAO Rosneft, which bought the entire venture for about $55 billion.
“The joint venture was ultimately unsustainable- and we have managed to turn that challenge into an opportunity,” he said. BP will take a nearly 20 percent stake in Rosneft, according to his remarks. Dudley was nominated last month to serve on the Rosneft board.
Russia “has the largest combined oil and gas reserves, as well as the highest combined production of oil and gas” Dudley said. “In our view, its potential has yet to be realized.”
BP may look at investing in Venezuela again if the “right conditions” exist after the death of President Hugo Chavez, Dudley said on CNBC.
“We’re an oil company, so if the investments are there, economic and stable, you would see us there,” Dudley said.
BP announced the sale of its Venezuelan business to TNK-BP in 2010. The company has an interest in Venezuela through its stake in OAO Rosneft, Dudley said.
Royal Dutch Shell Plc (RDSA) is the largest European oil company. BP’s American Depositary Receipts rose 0.6 percent to $40.71 at the close in New York.
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