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Which should I choose for a fulfilling career: Chevron or BP?

In 2010, after BP’s DWGOM (Deep Water Gulf of Mexico) Macondo well, which had been drilled to a depth of 35,050 ft in the Tiber Oil Field at Keathley Canyon Block 102, approximately 250 miles southeast of Houston, TX, in 4,132 feet of water by Transocean’s Deep Water Horizon advanced semi-submersible drilling platform, the well blew out on April 20, 2010 with disastrous results. Eleven of its crew, none of which were BP employees, were killed and ultimately 4.9 million barrels of crude were spilled into the Gulf, some of which settled on its bottom, some of which reached and massively polluted the shores of Louisiana, Mississippi and parts of Alabama and east Texas and some of which was scooped off the water surface by skimmers, mostly operated by displaced local fishermen.By early 2013, criminal and civil settlements and payments to a trust fund had cost the company $42.2 billion. In late 2014, a U.S. District Court judge ruled that BP was primarily responsible for the oil spill because of its gross negligence and reckless conduct. In July 2015, BP agreed to pay $18.7 billion in fines, the largest corporate settlement in U.S. history.Throughout the intervening years intensive investigations, including Congressional hearings during which BP’s then GOM Exploration Manager was indicted on federal felony charges of perjuring himself during sworn Congressional testimony by knowingly offering misleading testimony regarding BP’s initial spillage estimates while under oath, negotiations, and litigations, BP’s primary culpability for the incident firmly was established. This mainly was due to deliberately bypassing standard engineering standards in well design and in operating procedures, a move which was vigorously protested by BP’s own engineers and geoscientists who were overruled by a management team which was obsessed with cost cutting and time saving in order make up for a well which immediately prior to the blowout had gone well over budget and well over schedule.The origins of the lax attitudes toward process safety can be traced back to the late 1980’s, when Bob Horton took over as BP’s CEO and decided that once BP had freed itself from UK Government control by buying back what was known as the Government’s “Golden Share”, BP had to expand quickly and in a very large way. This was the lone share left to the Government after having divested itself of all other shares to the public equities markets, but the terms of the offering effectively left ultimate control of BP’s activities in the hands of the Government via its Golden Share. Under Horton, BP began by buying from the markets the 45% they did not already own of US based Sohio Petroleum Company, a direct descendant from John Rockefeller’s original Standard Oil Trust, which in turn had served as the impetus for enactment of the Sherman Antitrust Act Congress in 1890 under the President Benjamin Harrison. Horton later went on to disgrace caused by alleged illicit activities in which he became involved as Head of British Rail after he stepped down from BP in the early 1990’s. BP bought those outstanding shares for a variety of reasons, not the least being that as a foreign entity, they were barred from controlling any US corporation in which they hold less than a 90% interest and, as we now are aware, no small thanks to the recent tragedy of Puerto Rico, under the Jones Act foreign flag carriers are not permitted to transport domestically produced goods of any kind between US ports. I.e., BP was desperate to find a way legally to transport their new horde of liquid gold from Alaska to refineries in Washington, California, Texas and Louisiana.Horton was succeeded by John Browne, at the time perceived to be a brilliant young engineer who rapidly had risen through BP’s senior management ranks, and eventually was knighted by Queen Elizabeth before being named to Britain’s House of Lords and assuming the title Baron Browne of Madingley, Cambridge for his numerous achievements after becoming BP’s CEO. By any measure, Browne possessed a sharp, inquisitive mind and soon established himself as having an enlightened mind as well. Early on, Browne began an ambitious campaign to establish BP as an innovative leader of environmental thinking and practices in a fossil fuels industry which historically had been dominated by people who were hostile toward such attitudes. Browne punctuated his move to re-image BP by replacing its traditional yellow BP against a green background with a new one depicting a shining bright sun against a bright green background with the “BP” relinked from “British Petroleum” to “Beyond Petroleum”, suggesting a re-emphasis toward renewable energy sources and earning BP the monicker “The Sun Company” along the way.But Brown’s real agenda soon revealed itself as he instituted an aggressive program of acquisition of industry rivals and ruthless cost cutting, partially as a way to fund those acquisitions, in his single minded pursuit to transform BP from a small but highly respected oil company to a large, integrated petroleum company, a giant to be reckoned with. Browne made no secret of the fact that, having succeeded in positioning BP as the third largest oil company in the world, his next target was to overtake his arch-rival, Royal Dutch Shell, as the second biggest oil company. While he never achieved that goal during his tenure, he clearly had set his sights on eventually surpassing Exxon/Mobil as the number one global petroleum leader.None of these ideals, nor the practices which Browne was prepared to incorporate in order to accomplish them, came without a price to be exacted. In early 2005, the Texas City Refinery explosion occurred when a hydrocarbon vapor cloud was ignited and violently exploded at the ISOM isomerization process unit at BP's Texas City refinery in Texas City, Texas, killing 15 workers and severely damaging the refinery. Its cause eventually was determined to be a combination of inadequate equipment which did not meet industry accepted API (American Petroleum Institute) standards and lax operational processes partially caused by inadequate staffing and lack of clear operating procedures. In particular, the ignited hydrocarbons originated from liquid overflow from the blowdown stack following operation of the raffinate splitter overpressure protection system caused by overfilling and overheating the refining tower contents.The key findings of several investigative reports are best summarized in "What Went Wrong: Oil Refinery Disaster", Tom Price (freelance writer) and T.J. Aulds (an editor), Galveston County Daily News.“Organizational failings included corporate cost-cutting, a failure to invest in the plant infrastructure, a lack of corporate oversight on both safety culture and major accident prevention programs, a focus on occupational safety and not process safety, a defective management of change process (which allowed the siting of contractor trailers too close to the ISOM process unit), the inadequate training of operators, a lack of competent supervision for start-up operations, poor communications between individuals and departments and the use of outdated and ineffective work procedures which were often not followed. Technical failings included a blowdown drum that was of insufficient size, a lack of preventative maintenance on safety critical systems, inoperative alarms and level sensors in the ISOM process unit and the continued use of outdated blowdown drum and stack technology when replacement with the safer flare option had been a feasible alternative for many years.”BP subsequently was forced to divest many of its most valuable assets, often at less than favorable, what-the-market-will-bear prices, in order to fund the settlements of those claims.This by no means was the only significant calamity to occur at BP under Browne’s watch, though it indisputably remains as his signature failure. In mid-2005, while testifying during UK civil court proceedings regarding the origins of his recent life partner, a young man whom he had procured via the Internet from Canada named Jeff Chevalier, Browne was caught lying under oath. Browne always has displayed an intensely private nature in matters concerning his personal life and had no desire publicly to disclose his sexuality, and he chose to answer untruthfully under questioning in order to protect that fact. What resulted instead was an immutable wave of intense public scrutiny of every aspect of Browne’s life, private as well as professional and public. By mid-2006, the pressure both on Browne and on BP’s Board had grown beyond control and Browne reluctantly was forced to accept what amounted to his ouster. For all of the beneficial and all of the harmful acts Browne had performed while heading BP, this seemingly innocuous act is the one that ultimately did him in.For the past few years, Browne had been grooming his hand picked successor, a longtime favorite who, like himself, was an exceptionally bright young geoscientist who also rapidly had been transitioning BP’s Senior Management structure, Tony Hayward. But Browne had planned on retaining BP’s helm for a couple more years before yielding to Tony. Now, as so frequently happens unexpectedly, things at the top changed on a dime. Tony suddenly found himself thrust into a role for which he still was in the preparation stages and had no choice other than to assume the helm and navigate his ship.But the problems that Tony inherited at BP largely were unacknowledged, or at least under appreciated. They stemmed literally from years of management neglect bordering on ignorance, lax at best, sinister at worst, which were born of attitudes at the very top ranging from the lackadaisical to malpractice, all of them generated out of an extraordinary preoccupation with growing the company (ie their power) while constraining its costs, the ultimate expense and impact of behaving in such a manner either ill or not at all considered. This, then, is the base root of every disaster and every tragedy which resulted as they blindly pursued their ill advised agendas.Tony was poorly equipped to handle anything like the Macondo tragedy when it inevitably occurred. While Tony likely has forgotten more than most of us ever will know about geology and geophysics, his dexterity at human relations was marginal at best and his finesse with public relations virtually was nonexistent. Thus, when the Deep Water Horizon disaster struck without warning on April 20, 2010, Tony was woefully unprepared, and probably unaware, of the culture of carelessness leading to recklessness which by then had permeated from its sprouts at the top all the way to the most basic working levels of BP. The only wonder is that it took as long as it did to occur, given the grow the company, damn the workers culture Browne may not have instigated, but certainly was a major contributor to at by then all of BP. And what specifically short circuited Tony’s premature demise as BP’s CEO? Two huge snafus that at first glance hardly seemed to be worth noticing. First, on the weekend after the Macondo blew out, the Board frantically tried to reach out to Tony for vital decisions that had to be made immediately. After several hours of inexplicable delay, they finally caught up with CEO Tony, casually sailing and enjoying himself on a pleasant Sunday afternoon off the southern coast of England. Second, when BP finally did produce their CEO-in-the-Flesh at BP’s LA onshore scene-of-the-crime HQ, when prompted to tell the press for the record on camera how he felt about the “accident” and the lives of the workers it cost, Tony’s limp, sad answer was, “I wish I had my life back.” ???!!! That fiasco proved to be Tony’s coup d’tat.So there’s a bit of background, now on to your question: Should you shoot for a career with BP or with Chevron? Let me begin first by stating that for thirty years, I harbored an insatiable desire to work for Chevron. I knew many of their people well and respected them highly, personally as well as professionally. But as all too often happens in life, opportunity often encounters great difficulty in meshing with availability. I might add that those who are so fortunate (and more than a little skilled and committed) as to acquire great wealth incredibly quickly, usually possess one more vital component: the ability to recognize opportunity even when it’s no more than a vaguely defined flash, the determination to do whatever it takes to ensure that availability occurs simultaneously, and the courage of their convictions to make it all come together seamlessly. That’s actually a much taller order than mere words in a single paragraph can convey.When I first began with BP (via Sohio) 37 years ago, I was ecstatic because it was a poorly kept industry secret that a job with BP was a real jewell to capture because of their well known standards both of technical excellence and of business integrity. The considerate, caring way in which they treated their employees was legendary in an industry noted for it’s exceptionally cold, brutal toughness back then. Though in all fairness, I must add that those same conditions made us quite proud to be part of such a uniquely challenging business. Sadly, the BP I’ve just finished describing for you bears little resemblance to the BP I so proudly had joined full of hope and promise in 1980. But I’ve given you a pretty good reference time frame for that comparison. So now let’s jump to 2011.After Tony left, BP’s Board had to move quickly but deliberately to find somebody upon whom they could rely to salvage the ruins of a once proud and solid firm. They settled on Bob Dudley, whom they acquired when BP absorbed Amoco (for whatever PR reason, Lord Browne tried to paint it as a merger at the time, but it was another acquisition, pure and simple). Dudley was another jewell to add to BP’s crown. A smart, ambitious, highly competent leader, Dudley accepted assignments which carried increasing responsibility throughout BP and performed well in each of them. One of his later assignments was to head TNKBP in Moscow, of which BP held the minor 25% interest and a Troika of Oligarchs who had made their fortunes during the post-Soviet Glasnost era held the remaining 75%. TNKBP really was Tony Hayward’s baby, engineered in conjunction with John Browne while Tony was President of BP Exploration Global, headquartered at BP’s corporate offices in St James Square in London under Browne’s tutelage.Dudley, by mutual agreement having been charged with simultaneously protecting BP’s interests while running TNKBP on behalf of the partnership, before long found himself afoul of the Oligarch Troika which held the majority stake. Eventually, the Oligarchs appealed to Vladimir Putin to intervene and settle the matter in their favor. Things soon reached a point where Dudley literally had to flee Russia in the dead of night for a place known only to a select few at the highest levels of BP and attempt to run BP’s interests in TNKBP from there. When Hayward was forced out over his handling of Macondo, Dudley was tapped to take Tony’s place.BP was in very shaky shape as a result of Macondo when Dudley took over. One of the first assets to hit the chopping block as a result was TNKBP. Dudley managed to strike a deal with his prior tormentors, the Oligarchs, to sell BP’s 25% interest in TNKBP back to them in exchange for an attractive position in the Russian oil giant, Rosneft. Once again, the Oligarchs double crossed Dudley and appealed directly to Putin. At Exxon/Mobil, Rex Tillerson, then its CEO, caught wind of the situation, sensed an opportunity and lost no time in exploiting his more favorable relationship with the Russians, pouncing on it and pushing BP aside. Once again, despite Dudley’s best efforts, BP had been cheated by the Oligarchs out of what it had viewed as one of the lynchpins to their Macondo salvation.In the interest of complete transparency, I need to disclose to you that I am a co-plaintiff, though not a lead plaintiff, in a class action suit intended to force reparations from BP for deliberate misrepresentations they made to Sohio legacy employees nearly thirty years earlier when BP unilaterally decided to convert our existing pensions, or defined benefits plans, to IRS 401K defined contribution plans and allegedly used misleading value projections to convince us that this conversion actually would prove to be beneficial to us. At the time, Sohio already had been absorbed by BP and we perceived, incorrectly, that we had little choice other than accepting BP’s decision. I should add that twelve years later, BP treated Amoco and Arco legacy employees considerably more favorably when BP’s proposal to absorb them still was on the table.So what does all this say about BP’s ethics and commitment not only to excellence, but arguably more importantly, to its employees today? My read, nearly 19 years retired but still in active contact with recent BP retirees is this. First, Bob Dudley, from everything I know about him, is not cut from Bob Horton’s nor from John Browne’s mold. He is a CEO of high competence and high ethical standards. BP’s attitude prior to Dudley toward their legacy employees, people with whom I personally have worked and are of unimpeachable personal ethics and professional standards, people who are an unquestionable asset to any firm they choose to join, have left BP literally in droves and almost uniformly in abject disgust with the callous attitudes of their immediate management and ruinous policies imposed upon them by BP’s upper management. This has caused BP to suffer dearly in the highly competitive leasing marketplace and their shareholders to suffer even more, as judged by BP’s share performance relative to its top ten competitors.But remember, all this disenchantment took place between BP’s Amoco acquisition in 1999 and Bob Dudley’s ascension in 2011. Dudley’s track record, despite unavoidable setbacks, has been sterling in setting the company on an anything but certain recovery after the culmination of a series of disasters directly traceable to their dismal senior management performance and ethics prior to Dudley’s arrival at St James Square.My one great wish is that Dudley could find some way to deploy the high standards of business ethics and business competence to which he holds himself to BP’s HR and Legal departments. All the legal minutiae aside, I think Dudley intuitively understands what is right and what is wrong, and he further subscribes to the idea that past wrongs must be set right, regardless of the time which has passed in the interim. I have read all of both sides’ legal court filings and while I’m certainly no attorney, neither do I consider myself to be an untested novice in court. Frankly, I am appalled by some of the questionable evasive tactics which have been employed by BP’s hired legal guns in their efforts to dismiss our claims with prejudice. Were they only taught legal proceedings and nothing about actual justice in law school? Perhaps Bob Dudley could approach our legal team, not to settle our case but to give BP’s legal guns a rigorous course in personal, legal, professional and business ethics before he pays them any more fees. That definitely needs to begin with Dudley’s direct executive reports, who have first line control over BP’s hired gunslingers. It would be a sound investment in BP’s future, with the emphasis being on recapturing their once vaunted reputation as a contemporary leading corporation.Finally, to answer you original question I would note that Chevron currently is in the throes of its own change in chain of command. While I continue to view Chevron as a sound, solid, reputable company, nobody can foresee where all this will lead. The question regarding BP is twofold. First, does Bob Dudley have enough time to push constructive, positive change from the very top all the way to the bottom of BP? I believe his head is in the right place, but bear in mind that it took Bob Horton and John Browne nearly two decades to totally mismanage that formidable task. Second, will he be able to achieve complete buy-in to an overwhelming change back to the standards which once created an awesome company in BP, modified as appropriate to accommodate contemporary standards of conduct and performance? From what I’ve seen of Dudley I believe the answer is yes on both counts. So, were I in your shoes at 25 years old rather than my shoes at 75 years old, I think I would be tempted to roll the dice that Dudley will prevail at BP over the long haul and cast my lot with them, banking on a brighter future over a longer term.I hope this long diatribe sheds some light and helps your decision. All the best to what I’m confident will be a promising future for a conscientious young graduate.

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