2 May 2007 - 16:35
  • News Code: 103744

John Browne, chief executive of British energy giant BP, unexpectedly resigned on Tuesday after a newspaper group won a legal battle to publish details of his relationship with another man.

Browne was due to retire in July after 12 years at the helm of the group he has helped transform into the world"s third-biggest energy group — but was on Tuesday replaced by his chosen successor Tony Hayward, BP said in a statement.


"Browne tendered his resignation after the lifting by the UK courts of a legal injunction preventing a newspaper group from publishing details of his private life," the group said.


BP chairperson Peter Sutherland described Browne"s decision to quit as a "tragedy".


"Shock at revelations"


Browne, 59, revealed in the statement that in initial witness statements, he had lied about how he met Canadian Jeff Chevalier, his former partner of four years.


"This account, prompted by my embarrassment and shock at the revelations, is a matter of deep regret. It was retracted and corrected. I have apologised unreservedly, and do so again today," Browne added.


One British newspaper said on its website that Browne may now face a charge of perjury, and possibly jail.


Browne"s sudden departure comes as BP seeks to restore investor confidence after a traumatic two years, during which time a fatal explosion at its Texas City refinery in the United States left 15 people dead.


On Tuesday, the share price in BP closed down 0.44 percent at 563 pence on London"s FTSE 100.


BP said that as a result of his decision to resign, Browne would lose his entitlement to a leaving package worth £3.5-million and a potential £12-million worth of shares.


"Erroneous claims"


Browne failed to prevent Associated Newspapers publishing a story about his relationship with Chevalier.


"In my 41 years with BP I have kept my private life separate from my business life," Browne said in the BP statement.


"I have always regarded my sexuality as a personal matter, to be kept private. It is a matter of deep disappointment that a newspaper group has now decided that allegations about my personal life should be made public.


"Concerning the court documents disclosed today, I wish to acknowledge that I did have a four-year relationship with Jeff Chevalier who has now chosen to tell his story to Associated Newspapers, publishers of The Daily Mail, Mail on Sunday and Evening Standard.


"These allegations are full of misleading and erroneous claims. In particular, I deny categorically any allegations of improper conduct relating to BP," Browne added.


Texas City incident


Browne had announced in January that he planned to quit in July, nearly 18 months ahead of schedule. Some analysts had blamed that change on BP"s recent troubles, highlighted by the Texas City incident in 2005.


Last year, meanwhile, the group was forced into a partial shutdown of its 400 000-barrel per day Prudhoe Bay field in Alaska following a leak in poorly maintained pipelines.


BP is struggling also to reverse a slide to its energy production. Last week it reported the seventh successive fall in quarterly output, alongside a 17-percent drop in first-quarter net earnings despite strong oil prices.


With BP experiencing slowing output the group had announced in January that Hayward, its head of exploration and production business, would be replacing Browne.


BP"s chief executive still leaves as a widely-respected boss after transforming the oil and gas group from a struggling organisation into one of the world"s biggest oil companies in terms of stock market capitalisation.


"For a chief executive who has made such an enormous contribution to this great company, it is a tragedy that he should be compelled by his sense of honour to resign in these painful circumstances," Sutherland said Tuesday.


In January, Browne was named as Britain"s most impressive businessman for the seventh time in eight years by a survey of his peers.



News Code 103744

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