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BP's Browne Taking Early Retirement; E&P CEO Hayward to Assume Reins

BP plc said Friday that CEO John Browne, who has faced increasing scrutiny from U.S. regulators, politicians and stakeholders following problems, accidents and scandals within some of the company's business units, will retire at the end of June, more than a year earlier than planned. Tony Hayward, currently head of exploration and production (E&P) for the London-based major, will succeed the embattled CEO.

Browne said last year he planned to retire at Dec. 31, 2008. However, late last year, rumors began circulating that the BP board was considering naming a top lieutenant or successor to assuage uncertainty within the company. Browne, however, was expected in any case to preside through the turnover.

Last year, an explosion at BP's Texas City, TX, plant killed 15 workers, which triggered an ongoing criminal investigation and hefty fines. U.S officials this year already have opened a separate criminal investigation into corrosion problems at the BP-operated Prudhoe Bay oilfield in Alaska (see Daily GPI, Oct. 25, 2006). Investigators also are probing BP's energy trading, specifically reviewing BP traders' possible manipulation of propane markets in 2004 and trades in gasoline and crude-oil markets (see Daily GPI, Aug. 30, 2006).

Hayward, who joined BP in 1982, was named CEO of BP's E&P segment in 2003. In that role he has been responsible for the group's assets and operational activities relating tot he discovery and production of hydrocarbons worldwide. Hayward moved to the London office in 1997 as director of BP Exploration following BP's merger with Amoco. In 1999 he became a group vice president and member of the upstream executive committee. Hayward was appointed group treasurer in 2000, with responsibility for global treasury operations, corporate finance, mergers and acquisitions. He became an executive vice president in 2002 and COO for E&P later that year.

Hayward also is a nonexecutive and senior independent director of Corus Group, and he was appointed Companion of the Chartered Management Institute in September 2005. He was a member of Citibank's advisory board between 2000 and 2003.

Browne, who carries the title of "Lord," was knighted in 1998 by Queen Elizabeth, and made a "life peer" in 2001. He was voted "Most Admired CEO" by the UK's "Management Today" between 1999 and 2002.

Browne, considered one of the energy industry's visionaries for his success in acquiring companies and his lead on environmental issues, first joined BP in 1966 as a university apprentice. Between 1969 and 1983, he held a variety of E&P posts, which headquartered him in several U.S. cities. In 1984, Browne was named group treasurer and CEO of BP Finance International. In April 1986, he became CFO of The Standard Oil Co. in Cleveland, OH.

Following the merger of BP and Standard in 1987, Browne was appointed CEO of Standard Oil Production Co. He then moved into the CEO role for BP Exploration, based in London, in 1989. By late 1991, Browne had joined the board of BP plc as a managing director, and four years later, he was named Group CEO. When BP and Amoco merged in 1998, Browne became Group CEO of BP Amoco.

Browne was said to have been pressured to firm up his retirement date by BP Chairman Peter Sutherland, according to the London press. In a statement Friday, Sutherland said the BP board "fully supports" Browne's decision to retire earlier than expected. The board concluded "that a six-month handover would be more appropriate."

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