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US Gulf oil spill nearly ruined BP, says chief Bob Dudley

Response crews battle the blazing remnants of the offshore oil rig Deepwater Horizon on 21 April 2010 Image copyright Reuters/US Coast Guard
Image caption BP reached a £12bn settlement over the spill with the US Department of Justice in July

The giant oil spill from a BP rig off the US coast in 2010 nearly ruined the company, its chief executive has said.

Bob Dudley described the fire on the Deepwater Horizon and its aftermath as "a near death experience" for the firm.

It was one of the worst environmental disasters in the US and saw BP pay fines and compensation and sell off more than £30bn ($45bn) in assets.

Mr Dudley told ex-BP boss Lord Browne - a guest editor on BBC Radio 4's Today programme - it was a "tragic accident".

He said it had shaken the company "to its core" and led to a complete change in its organisational structure.

"Sometimes it takes a near death experience to radically change a company. It was a forced focussing down of what we do, it was this is what we need to do to survive."

The rig, which had been leased by the firm, exploded on 20 April 2010, killing 11 workers and spilling more than three million barrels of crude oil into the Gulf of Mexico off the coast of Louisiana.

The spill affected the shorelines of five states - Louisiana, Texas, Mississippi, Alabama and Florida - crippling ecosystems and local economies.

In 2012, BP accepted responsibility for the disaster and agreed to pay £3bn to the US government, settling its criminal liability.

Last October, it agreed to pay £13bn in a settlement with the US Department of Justice over civil actions brought by the government and the five states over the environmental and economic impact.

'Stranded assets'

Meanwhile, Mr Dudley has also said Bank of England governor Mark Carney may have exaggerated the financial risk to the energy industry of having to leave oil and gas in the ground due to strict targets to cut CO2 emissions.

Mr Carney's comments saw him suggest oil companies might end up with a lot of so-called stranded assets - reserves which may never be tapped because of the new global limits on emissions.

Mr Dudley told Lord Browne the Bank of England governor had overstated the problem and he had raised the issue directly with him.

"I've spoken to the governor about it and I've questioned about that term," he said.

Image copyright Reuters/BBC
Image caption Bob Dudley (left) was interviewed by the former BP chief executive Lord Browne

However, he said he supported "thoroughly" Mr Carney's concerns about climate change and finding the right pricing mechanisms for carbon fuels.

The Paris climate change summit deal to attempt to limit the rise in global temperatures to less than 2C was a "very welcome agreement", he said.

However, the world still faced a "really difficult problem" in reducing emissions at the same time as producing enough energy for a growing population, he added.

Mr Dudley also told his predecessor that public trust in big business was at a low, and companies had a responsibility to better connect with employees and societies all over the world.

The recent drop in oil prices was here to stay "for a couple of years", with a possible low point in the first quarter of 2016, he predicted.

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