Oil Spill Lessons Learned

LONDON — Two days before he takes over BP, the new chief executive, Robert Dudley, partially shook up the structure of the British oil giant on Wednesday and promised an emphasis on safety.

Mr. Dudley announced that BP would set up a new global safety division and make other changes to the way the company operates as it seeks to absorb some lessons from the explosion of a oil rig five months ago. Eleven workers were killed and nearly five million barrels of oil spilled into the Gulf of Mexico.

BP to Create New Safety Division

As part of the changes, Andy Inglis, the head of exploration and production who was in charge of drilling and sealing the blown-out well in the Gulf of Mexico, will leave the company.

The moves, Mr. Dudley said, were “the first and most urgent steps in a program I am putting in place to rebuild trust in BP — the trust of our customers, of governments, of our employees and of the world at large.”

“The changes are in areas where I believe we most clearly need to act,” he said, “with safety and risk management our most urgent priority.”

In a message to BP staff around the world, Mr. Dudley said that “there are lessons for us relating to the way we operate, the way we organize our company and the way we manage risk.”

BP said the new division would aim to improve risk management and safety, and also review how the company manages agreements with contractors. The plans were announced as Mr. Dudley prepares to take over as chief executive on Friday. He hadpledged earlier this year after accepting the job that he would review not only BP’s safety procedures and its operations, but company culture as well.

An analyst at Morningstar, Cathy Milostan, said Mr. Dudley was “setting the stage quickly to change the course of BP, and he is drawing a focus on a new safety regime.”

The new safety division will be led by Mark Bly, the company’s head of safety and operations. The unit will be “powerful” and “designed to strengthen safety and risk management across the BP group,” the company said in a statement. “It will be responsible for ensuring that all operations are carried out to common standards.”

Earlier this year, Mr. Bly led the investigation into the explosion of the Deepwater Horizon rig. Though the 193-page report was in part a mea culpa on BP’s part, it also deflected attention from BP and onto its contractors, especially Transocean, which owned the rig, and Halliburton, which performed cement jobs on the well.

Amy Myers Jaffe, an energy expert at Rice University, expressed skepticism over the company’s selection of the same man who oversaw safety before the Deepwater Horizon accident to continue leading safety efforts. “One would have imagined they would have brought in an external candidate to take over the new division,” she said. “It’s too early to tell whether these changes will make a substantial difference.”

Pavel Molchanov, an energy analyst with Raymond James & Associates, said that it would take time to determine whether the safety division is more than just “window-dressing.”

“I certainly like the concept of having this type of internal safety oversight group,” Mr. Molchanov said, “but call me cynical, I have to wonder: how much real influence will it have?”

A company spokesman, Andrew Gowers, said Mr. Bly would “get considerably more power” and would now sit on BP’s executive committee. Managers will be reporting directly to him, Mr. Gowers said, and he will now be able to establish standard safety practices and tests where none existed before. “These are the first and most urgent steps in a series of actions that need to be taken,” he said.

Mr. Dudley said Wednesday that he planned to split the upstream division into three new units: exploration, development and production. They would be led by three different executives who would report directly to Mr. Dudley.

As a result, Mr. Inglis will step down as head of upstream and leave the company at the end of the year. He will step down as director on Oct. 31.

BP came under pressure to review its operations after the explosion in April on a rig in the Gulf that leaked millions of barrels of oil into the water before it was sealed this month. Critics charged that BP ignored some warnings signals and contributed to the disaster through cost cutting on equipment and its well design. The company has denied that it cut corners or rushed its work.

BP’s shares rose 2.7 percent in early trading in London on Wednesday. The shares have dropped about 35 percent since the rig explosion. In the United States exchanges, BP shares were up just over 1 percent in early trading.

BP’s departing chief executive, Tony Hayward, defended BP’s safety record in front of a Parliamentary committee in London this month, rejecting claims from some in the industry that the accident was partly due to BP’s efforts to trim expenses.

Mr. Dudley, who was in charge of the gulf cleanup effort, said the new changes were intended to rebuild trust in BP.

“That trust is vital to the restoration of shareholder value which has been so adversely affected by recent events,” he said. “The changes are in areas where I believe we most clearly need to act, with safety and risk management our most urgent priority.”

Mr. Dudley said he also plans a review of how BP creates incentives for business performance, to find out how it can encourage staff to improve safety and risk management.

The BP chairman, Carl-Henric Svanberg, said: “There are still difficult challenges ahead but we have assembled a strong and able new team and are developing a robust strategy to deal with them and to deliver our ultimate goal — the restoration of shareholder value.”

BP has made similar pledges in the past to improve safety and its reputation.

In July 2006, chastened by a string of safety, environmental and legal problems in their American operations, BP pledged to restore credibility by bringing in outside experts, being more transparent and investing more heavily in safety and maintenance.

That moved followed three separate incidents. In 2005, the blast at its Texas City refinery killed 15 workers and injured more than 180.

Then in March 2006, BP spilled thousands of barrels of crude oil over two acres of Alaska’s tundra and was criticized for its maintenance on the North Slope pipeline. And then a few month later, American regulators and prosecutors filed complaints about a propane price-fixing scheme.

“This is not good stuff,” John Browne, then the chief executive of BP, said at the time. “We have to take firm action.”