BP will resume deepwater drilling in the Gulf of Mexico in July after striking a landmark deal with American regulators.
News of the agreement is likely to cause uproar among environmentalists and safety campaigners. A year ago a rig working on a BP well in the gulf exploded, killing 11 workers and causing the worst oil spill in history. Last week prosecutors warned they could consider manslaughter charges against BP managers. BP has made provisions of $41 billion against the cost of the clean-up and claims for damages.
The disaster plunged the British oil group into crisis. Sustained attacks from President Barack Obama led some to fear it would be banned from the gulf, or driven out of America altogether.
To restart drilling, BP is understood to have granted 24-hour access to government overseers and has pledged to meet safety requirements that go beyond tougher rules imposed after the accident.
BP will not be allowed to drill exploration wells, but only those needed to maintain or increase production on existing platforms. BP has more than 20 deepwater fields in the gulf.
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Some of the new wells will be at the great depths where last year’s disaster occurred. Industry sources say permission for exploration drilling — the disaster was on an exploratory well — may come later this year.
BP and the Bureau of Ocean Energy Management, Regulation and Enforcement, in charge of gulf operations, declined to comment.
The deal is a coup for Bob Dudley, who replaced Tony Hayward as BP’s chief executive. America is one of the group’s biggest markets and, before the spill, was central to its growth plans. BP shares closed on Friday at 470p, down a quarter from the 650p they hit before the blowout.
Dudley is making halting progress on his other bet to revitalise BP: a $16 billion (£9.9 billion) share swap and Arctic exploration alliance with Rosneft, the Kremlin-controlled oil group. An independent arbitration tribunal set up to rule on the deal meets tomorrow. Byron Grote, BP’s finance director, will give evidence.
Dudley announced the deal in January. The tie-up included an agreement to explore a North Sea-sized area of Arctic seabed. Shareholders applauded the move because it gave access to potentially lucrative new fields. The move infuriated AAR, the consortium of four Russian billionaires who own half of BP’s other Russian business, TNK-BP.
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They won a court injunction to stop the deal, pending the tribunal’s ruling. In its first decision last month the panel sided with the billionaires, ruling that the Arctic alliance violated a shareholder agreement. BP wants to go ahead with the share swap, which is the subject of tomorrow’s tribunal.
The verdict has set the stage for a showdown on April 14, the day of BP’s annual meeting as well as the deadline to complete the Rosneft tie-up.
— Transocean, the owner of the Deepwater Horizon, the rig that blew up last April, last year paid $43m to its top six executives. This included a bonus related to safety, which it claimed was the “best in company history”.