By choosing Robert Dudley to head BP, the oil company's board has opted for someone who seems tailor-fitted to what will surely be sizable challenges ahead.
BP needs someone who can steer the company's Gulf oil spill response, which will continue to be a major focus for months even if the efforts to permanently stop the leak are successful. That's something Mr. Dudley as already been doing in recent weeks, working closely with federal officials.
BP needs someone who won't say the wrong thing in public, making BP look insensitive or arrogant. Dudley has shown himself to have a calm and careful demeanor.
BP needs someone with skills and persona suited to restoring trust in BP, especially among regulators who have leverage over BP's important US operations. Dudley, announced Tuesday to be BP's chief executive starting in October, will be the company's first-ever American in that top post. He can even talk about a boyhood in Mississippi. Combine that with a measured style and technical know-how (he's a chemical engineer).
BP needs someone who can lead BP into life after the oil spill. Dudley has experience developing global oil ventures, and he's worked at other companies as well as BP.
All this doesn't ensure that Dudley will prove himself to be a success.
But BP's board chairman said Tuesday that Dudley rose to the top in a search that included other potential candidates, both inside and outside the firm.
"We are highly fortunate to have a successor of the calibre of Bob Dudley who has spent his working life in the oil industry both in the US and overseas and has proved himself a robust operator in the toughest circumstances," BP Chairman Carl-Henric Svanberg said in a statement on the transition, issued alongside news of a $17 billion quarterly loss related to the spill.
Praise from analysts
Some investment analysts say the choice bodes well for BP to work through its significant challenges.
Pavel Molchanov, a stock analyst at Raymond James in Houston, wrote with colleagues Tuesday that Dudley "is by all accounts a level-headed troubleshooter (with Russian experience to boot) who will surely avoid his predecessor’s penchant for ill-timed television gaffes and yachting trips. In addition, as an American ... his appointment should deflect some of the pressure on the company emanating from Washington."
Still, Dudley faces what could be a hard struggle to rebuild the company and its reputation.
In an interview on CNBC Tuesday, he walked a careful line: acknowledging that the company needs to change and ramp up its focus on safety but also standing up for BP's practices at a time when investigators are still probing the cause of the rig disaster, in which actions by employees of both BP and of other contractors may have played a role.
Asked if he thought that cutting corners on safety led to the accident, Dudley said: "I do not. I do not."
Changing a 'culture of recklessness'?
But critics say cutting corners is exactly what BP has done. Tyson Slocum, an energy expert at the watchdog group Public Citizen, said in a statement Tuesday that BP has a "culture of recklessness" and that Dudley must resist "the urge to simply do a PR facelift of the kind favored by [Tony] Hayward" and other predecessors.
The company is one of the oil industry's "majors," and appears poised to remain so. But it is becoming smaller, moving to sell about $30 billion in assets to help pay for spill-related expenses.
Ms. Milostan says Dudley's vital tasks now are to build a strong culture of safety, to restore public trust, and to show that the firm can continue to form profitable partnerships around the world.
Even as the firm sells some assets, Milostan wants to see BP continue to announce new business ventures with national oil companies on other continents. And even sooner, as Dudley transitions into the top post in London, she hopes to see the firm get specific about how it will reset its culture and measure safety improvements.
Dudley has been quick to promise change. In the CNBC TV interview, he said "We're going to hold ourself now to a very high standard," he said, adding that he expects BP to remain a major player in the US oil industry.
"We have a very good prospective business" in the Gulf, he said. "We just now have to meet our commitments there."