BP oil spill clean-up bill hits $11.2bn

The clean-up bill for the Gulf of Mexico oil spill has risen to $11.2bn, BP said today as new boss Bob Dudley officially takes up the reins.

The firm, which sees Mr Dudley take over from embattled chief executive Tony Hayward, said it had also pledged assets including interests in production from its major Thunder Horse and Mad Dog operations to support a $31.6bn compensation fund.

But despite mounting costs for the Gulf of Mexico oil spill, BP cheered investors yesterday after Mr Dudley hinted that dividend payments would resume within months.

Shares in the group were up another 2% today after closing 2% higher yesterday.

Mr Dudley suggested dividends could restart early next year, saying the board would discuss the prospect of paying a dividend in the first quarter.

BP stopped paying out to shareholders in the wake of the Gulf of Mexico oil disaster, but political pressure has eased since the group’s move to ring-fence its mammoth compensation fund.

The firm also appeased long-suffering shareholders earlier this week with decisive action to rebuild trust following the spill.

Mr Dudley unveiled a management overhaul in exploration and the creation of a new safety division.

Exploration chief Andy Inglis will leave as a result of the shake-up.

The explosion on April 20 killed 11 workers and caused an estimated 4.9 million barrels of oil to gush into the Gulf – the largest offshore spill in history.

Oil has not been spilling into the ocean since mid-July and was finally sealed permanently on September 19, when BP said the bill stood at $9.5bn.

The group is continuing clean-up efforts, but said it was able to start removing containment equipment and boats in position at the site of the Deepwater Horizon well.

Mr Dudley said on announcing Wednesday’s major changes that he was taking “urgent steps” to “rebuild trust in BP”.

He stressed the overhaul needed to go beyond deepwater drilling and confirmed its new safety division would have sweeping powers across all BP’s operations.

He also promised a review of BP’s bonus structure and how it manages third-party contractors, which bore much of the blame for the spill in BP’s internal report.

But he faces an uphill struggle in leading a turnaround after the spill.

For Mr Hayward, it brought a 28-year career with the oil group to an abrupt end.

He enjoyed a successful tenure before the spill, but is likely to be remembered for a series of unfortunate PR gaffes during the crisis.

Mr Dudley, 55, has recently been in charge of BP’s response efforts in the Gulf of Mexico.

He joined BP from Amoco after the merger of the two companies in 1998 and headed TNK-BP until December 2008, when he left after a bitter dispute between BP and its Russian partners.

Mr Dudley was appointed to BP’s board last April. Last December he was awarded an honorary CBE for services to global energy security and industry.

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