Thaindian News

London, June 4 (DPA) BP called for a change in oil exploration methods and said the besieged company would be at the movement’s forefront during a conference call Friday with worried investors.
BP’s stock has taken a pummelling this week as investors grow worried about the costs it will have to bear as it struggles to cap an oil well that has been leaking thousands of litres of oil into the Gulf of Mexico since an oil rig collapsed April 20 following an explosion.

BP Chief Executive Tony Hayward said oil exploration will, in future, require stricter security measures in deep waters, but also would have to remain profitable.

The company would have little choice, he said, noting that demand for oil is only going to increase, requiring exploration in harder-to-reach areas.

But he promised that BP had learned lessons about safety from the ongoing saga of the oil spill and the efforts to contain it. New divisions would be set up in BP that would focus exclusively on the reasons for the sinking of the Deepwater Horizon.

He also sought to reassure investors that BP would be able to survive the costs of the clean-up, saying that BP remains a strong company. Hayward also dismissed rumours that he might step down from his position.

Hayward estimated that BP had spent about $1 billion on trying to plug the leak so far and said spending would likely remain at that level until no more oil is escaping into the Gulf of Mexico.

The decision to hold the conference call came after the credit rating agencies Fitch and Moody’s both lowered their BP rating by one notch Thursday and warned that further downgrades were possible.

Shares in BP plunged by more than 15 percent earlier this week on the London Stock Exchange, as investors responded gloomily to news that a top-kill operation had failed to block the oil gusher.

Before the explosion of the BP-leased Deepwater Horizon oil rig led to the broken pipe April 20, the company’s shares had been trading at about 655 pence ($9.59). Friday morning, BP shares were trading some 31 percent lower, at around 449 pence.

BP succeeded Thursday in cutting a portion of the gushing pipe, in what US government officials described as a “significant step” in the ongoing effort to plug the leaking wellhead.

But the cut is not as fine as was originally hoped and could complicate matters for the next step: placing a small containment dome over the marine riser pipe, which could capture most of the oil and siphon it up to the surface.

Only once the cap was in place would it be clear how much of the oil was still seeping out of the ruptured well, officials said.