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BP Managing Director Bob Dudley may soon replace Tony Hayward as CEO of BP, becoming the first American to head the British oil company.
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updated 7/26/2010 6:52:36 PM ET 2010-07-26T22:52:36

The man overseeing the much-maligned response by BP PLC to the Gulf oil spill crisis is the likely choice to replace gaffe-prone Tony Hayward to run the company and would become the first American to ever head the British oil giant.

A senior U.S. government official said Sunday that Hayward is on his way out but didn't know who would be his successor. The official was briefed on the decision last week and spoke on condition of anonymity because an announcement had not been made.

BP said Monday that "no final decision" had been made about management changes. The oil company said its board would meet Monday evening, a day before it announces earnings for the second quarter.

One of the most likely replacements would be Bob Dudley, BP's managing director, who spent part of his boyhood in Mississippi and has been running the day-to-day oil response since June. He would be the first American to head BP PLC since it was founded as the Anglo-Persian Oil Co. in 1909, according to a spokesman.

There also has been speculation that BP could tap Iain Conn, a Scot who runs BP's refining and marketing arm and also serves on BP's board of directors. BP's board would have to approve a change in company leadership.

To analysts and Gulf residents, it would be a welcome change for a company that has been criticized as being out of touch with the concerns of U.S. fishermen, tourists and residents affected by the catastrophe.

"He's a very good delegator," Oppenheimer & Co. senior analyst Fadel Gheit said of the 54-year-old Dudley.

It also helps that Dudley can identify with the people and the region.

Dudley spent time growing up in Hattiesburg, Mississippi, an easy drive from the Gulf of Mexico coast. He spent two decades climbing the ranks at Amoco Corp., which merged with BP, and lost out to Hayward on the CEO's slot three years ago.

Dudley is viewed as more of a diplomat than Hayward, who angered U.S. lawmakers with his refusal to answer many of their questions during testimony in Washington on the spill. That was after infuriating scores of frustrated Gulf residents by infamously declaring "I'd like my life back," in May.

In his first week running the spill response, Dudley shuttled between the Gulf and Washington, defended BP engineers after a setback, toured a center where oil-covered turtles are treated and enlisted the help of a politically connected relief expert.

He also has held a nationally broadcast town-hall style meeting with Gulf residents and has been in daily contact with U.S. government officials.

BP has not confirmed that Hayward is being replaced. Early Sunday, company spokesman Toby Odone seemed to downplay media speculation about the departure, saying he "remains BP's chief executive, and he has the confidence of the board and senior management."

In television interviews Monday, Democratic Congressman Edward Markey, who heads the House subcommittee on energy and environment, welcomed news that Hayward might be replaced. But he expressed caution about Dudley, noting it was Dudley who said earlier this month that the oil well could possibly be fixed by July 27. Work on relief wells expected to permanently kill the well is not yet complete.

"I'm hopeful that Mr. Dudley will be more responsible, but a total change in the culture of this company is necessary," Markey told CBS television.

It's been more than three months since an offshore drilling rig operated by BP exploded off Louisiana on April 20, killing 11 workers and setting off the spill. A temporary plug has stopped oil from gushing for more than a week now, but before that the busted well had spewed anywhere from 94 million gallons to 184 million gallons (356 million liters to 697 million liters) into the Gulf.

Since the explosion, Hayward has made several highly publicized gaffes. Among them: going to a yacht race while oil washed up on Gulf shores, and uttering the now-infamous: "I'd like my life back" line.

Gheit, the analyst, said it was too bad Hayward's career was derailed by the spill, but "unfortunately he became a sacrificial lamb in a politically charged world."

Dudley would be well-suited to take over, Gheit said, while noting that it is never an easy time to instill new leadership in a company.

"I'm not sure if removing Tony Hayward is going to throw BP's problems away," Gheit said.

New Orleans Mayor Mitch Landrieu said BP's attitude about making things right is more important than who is running it.

"BP, from I think everybody's perspective, made a very bad mistake," he said. "I think what the world expects from BP is an acknowledgment that something was done wrong. I think BP has a long way to go to gain the trust of the people."

Related: BP CEO to step down, join Russian venture

The company has already spent roughly $4 billion on its response to the crisis. The final tally could be in the tens of billions of dollars.

Crews trying to plug the leaky well for good had to stop work late last week because of the threat from Tropical Storm Bonnie, but the effort was back on track as skies cleared Sunday. A drill rig was expected to reconnect Monday to the relief tunnel that will be used to pump in mud and cement to seal the well, and drilling could resume in the next few days.

Completion of the relief well that is the best chance to permanently stop the oil now looks possible by mid-August, but retired Coast Guard Adm. Thad Allen, the government's point man for the spill, said he wouldn't hesitate to order another evacuation based on forecasts similar to the ones for Bonnie.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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