4A NEWS
THE UNIVERSITY DAILY KANSAN
WEDNESDAY, MAY 2, 2007
BUSINESS
BP chief executive resigns
ASSOCIATED PRESS
LONDON — BP PLC's Chief Executive John Browne resigned Tuesday, hours after a judge allowed a newspaper to publish allegations from a former boyfriend that the executive misused company resources.
Browne, who had already moved up his departure by more than a year after a deadly refinery blast in Texas and a giant oil spill in Alaska, denied any improper conduct relating to BP. But he acknowledged that he had lied to a judge about how he met his former partner, with whom he had a four-year relationship.
The Mail on Sunday, the newspaper that had sought to publish the claims, immediately called for Browne to be prosecuted for perjury.
Browne said he regretted the lie, saying he was in shock at his private life being exposed, aid was stepping down voluntarily "to avoid unnecessary embarrassment and distraction to the company."
"For the past 41 years of my career at BP I have kept my private life separate from my business life," he said.
Browne's designated successor, exploration and production head Tony Hayward, will take over as CEO immediately, the company said. He will have to repair BP's tarnished reputation after the series of high-profile operational and regulatory mishaps.
BP said Browne's decision meant he would lose a bonus of up to 1.3 times his annual salary, worth more than 3.5 million pounds ($6.9 million). He would also forgo inclusion in a share plan with a potential value of 12 million pounds ($23.9 million).
Browne, 59, had been fighting since January to keep the Mail on Sunday from publishing details from the interview with Jeff Chevalier. He acknowledged the relationship in the statement Tuesday and apologized for lying to the judge.
"My initial witness statements ... contained an untruthful account about how I first met Jeff," he said. "This account, prompted by my embarrassment and shock at the revelations, is a matter of deep regret."
The Mail on Sunday said it would provide evidence of Browne's deception to the attorney general's office.
CUBA
Castro missed at May Day march
ASSOCIATED PRESS
HAVANA — There was no sign of a convalescing Fidel Castro as hundreds of thousands of Cubans marched through Havana's Revolution Plaza to celebrate May Day, casting new doubts on his recovery and whether he will return to power.
Tuesday marked only the third time in nearly five decades that Castro has missed the sweeping International Workers' Day festivities, a major celebration here and around the world.
While recent images of Castro meeting with Chinese leaders indicated he had improved considerably since undergoing emergency surgery nine months ago, his absence at the parade through the Revolution Plaza raised questions about whether he is strong enough to run the country.
The 80-year-old leader has
missed two other major events since announcing his illness on July 31 and temporarily ceding power to his 75-year-old brother Raul Castro, the defense minister. Raul presided at the Nonaligned Summit in September and a major military parade in December.
"It now seems more unlikely than before that he will fully resume the presidency," said Wayne Smith, the former head of the American mission in Havana. "And the more time that passes, the more unlikely it seems."
Smith said that with Castro failed to show Tuesday, Venezuela President Hugo Chavez's assertions this week that Castro was back appeared to be "a lot of hot air."
Others said he could still resume some responsibility.
"To me, the key question is to what degree is he coming back?" said Phil Peters, Cuba specialist for the Lexington Institute, a
Washington-area think tank, "Would his comeback be partial, ceremonial? Will he spend two hours in the office checking off on strategic decisions?"
Raul Castro, wearing his typical olive-green uniform and cap, stood stiffly and smiled under the shadow of a statue of Cuban independence leader Jose Marti. He waved as marchers clad in red T-shirts and dark slacks streamed past, clutching plastic Cuban flags, portraits of his more famous brother and banners denouncing U.S. "imperialism."
Although Cuban life is little changed under Raul's leadership, loyalists missed the energy Fidel brought to events such as May Day.
"Everyone wanted to see him, but it's good that he recovers completely. Now the revolution is continuing with Raul," said 68-year-old hotel worker Victor Reyes, who was among the marchers.
》OIL INDUSTRY
Fernando Llano/ASSOCIATED PRESS
ASSOCIATED PRESS
Chavez takes over oil fields
BARCELONA Venezuela President Hugo Chavez's government took over Venezuela's last privately run oil fields Tuesday, intensifying a power struggle with international companies over the world's largest known petroleum deposit.
Venezuela's President Hugo Chavez, center, delivers a speech back dropped by a banner that reads in Spanish "Oil Company on its way to socialism", to oil workers Tuesday in Barcelona, Venezuela. Chavez's government took over Venezuela's last privately run oil fields Tuesday, intensifying a power struggle with international companies over one of the world's largest known petroleum deposit.
Oil Minister Rafael Ramirez declared that the fields had reverted to state control just after midnight. State television showed cheering workers in hard hats raising the flags of Venezuela and the national oil company over a refinery and four drilling fields in the Orinoco River basin.
Chavez, a strident critic of the U.S. and a leader of the leftist movement in Latin America, traveled to the refinery for a ceremony with red-clad oil workers on May Day, the international workers' holiday. The military planned a fly-over by Russian-made fighter jets.
While the state takecover had been planned for some time, BP PLC, ConocoPhillips, Exxon Mobil Corp., Chevron Corp., France's Total SA and Norway's Statoil ASA remain locked in a struggle with the Chavez government over the terms and conditions under which they will be allowed to stay on as minority partners.
All but ConocoPhillips signed agreements last week agreeing in principle to state control, and ConocoPhillips said Tuesday that it too was cooperating.
Analysts say the companies have leverage because Venezuela's state oil company, Petroleos de Venezuela SA, cannot transform the Orinoco's tar-like crude into marketable oil without their investment and experience.
"They're hoping ... that as time passes Chavez will realize he needs them more than they need him," said Michael Lynch, an analyst at Winchester, Massachusetts-based Strategic Energy and Economic Research. He predicted most oil companies — with the possible exception of Exxon Mobil — would stay.
Multinationaln pumping oil elsewhere in Venezuela, one of the leading suppliers of oil to the United States, submitted to state-controlled joint ventures last year because they were reluctant to abandon the profitable operations.
Chavez says the state is taking a minimum 60-percent stake in the Orinoco operations, but he is urging foreign companies to stay and help develop the fields. They have until June 26 to negotiate the terms.
An enormous Venezuelan flag was hung between two cranes at the refinery, and smaller flags flew from lamp posts. Red balloons were attached to power lines.
The oil companies, meanwhile, still needed convincing that Venezuela will be a good place to do business.
Chevron's future in Venezuela "will very much be dependent on how we're treated in the current negotiation," said David O'Reilly, chief executive of the San Ramon, California-based company. "That process is going to have a direct impact on our appetite going forward."
BP, Exxon ConocoPhillips all say they're negotiating with Venezuela to determine ownership and compensation for their operations.
Jim Mulva, chairman and chief executive of ConocoPhillips, which has two projects in the oil-rich Orinoco River region and
Mobil and
"I don't think he's going to be able to get more money out of the Orinoco or the foreign oil companies without being a lot nicer to them."
MICHAEL LYNCH Energy analyst
another offshore, has said he expects discussions to be completed by late June.
tion for its 16.7 percent stake in the Cerro Negro heavy oil project in the Orinoco belt. The majority of that project is owned by Exxon Mobil and PDVSA.
In a conference call with analysts last week after reporting first-quarter earnings, Henry Hubble, Exxon Mobil's vice president of investor relations, said the company expected negotiations to continue "for some time." Hubble declined to speculate whether Exxon Mobil would continue to do business in Venezuela after such discussions are finished.
Chavez "is going to discover that nationalism is one thing, but money talks." Lynch said. "And I don't think
The stakes are high for both sides as Venezuela stands to surpass Saudi Arabia as the nation with the most reserves. If the big oil companies were to leave, Chavez says state firms from China, India and elsewhere can step in, but industry experts doubt they are qualified.
"ConocoPhillips has cooperated with the established transitional committees to ensure a safe, orderly transfer of operations," the company said in a statement Tuesday.
It added, "While discussions between ConocoPhillips and the Venezuelan government are ongoing, agreements have not been reached with respect to ConocoPhillips' future participation in these projects or the compensation the company will receive."
ConocoPhillips' Venezuelan operations account for roughly 4 percent of its daily worldwide production.
BP spokesman David Nicholas said the London-based company also was negotiating compensa-
he's going to be able to get more money out of the Orinoco or the foreign oil companies without being a lot nicer to them."
Pulling out would be damaging for the companies. They have invested more than $17 billion in the projects, now
estimated to be worth $30 billion. Venezuela has indicated it is inclined to pay the lesser amount for taking over control — with partial payment in oil and, some experts suspect, tax forgiveness. Venezuela may still prove enticing because three-quarters of the world's proven reserves are already controlled by state monopolies.
Chavez is also nationalizing electricity companies and the country's biggest telecommunications company, and has threatened to take over private hospitals if they continue raising prices for care.
The campaign has brought popularity for Chavez, who takes to the airwaves almost daily, delivering tirades against the rich, the news media, capitalism in general and his archemen, the U.S. government.