BP's Former CEO Approaches Abu Dhabi's SWF to Lead New Oil Company

(February 6, 2011) — Former BP Chief Executive Tony Hayward is in talks to lead a new oil company less than six months after he quit his position following the Gulf of Mexico oil spill, the Sunday Times reported, citing an unidentified person close to the situation.

Hayward, who stepped down from his position at BP after the April 20 explosion aboard a rig in the Gulf of Mexico, has been reportedly approached by representatives from the Abu Dhabi Investment Authority (ADIA), one of the largest SWFs in the world boasting roughly $790 billion in assets, with an offer of several billion dollars to build a new company.

According to the Sunday Times, the proposal by the Abu Dhabi SWF, whose investments range from takes in Ferrari, ports, aerospace and renewable energy firms, is in its infancy and is one of several being considered by Hayward. The publication further reported that Hayward’s relationship with Abu Dhabi’s crown prince Mohammed bin Zayed bin Sultan al-Nayhan is believed to be strong.

Hayward was reported last month to be in talks about joining the board of commodities group Glencore.

In July of last year, after BP’s stock plummeted as a result of the Gulf of Mexico disaster, Hayward had turned to sovereign wealth funds in the Middle East and Asia to attempt to guard against takeover bids. The embattled British energy giant had reportedly approached SWFs in countries that include Abu Dhabi, Kuwait, Qatar and Singapore.

Hayward was attracted to SWFs in the region because of their understanding of the oil industry and their unlikeliness to interfere with the operational side of BP’s business, with SWFs in Kuwait, Abu Dhabi and Qatar additionally viewed as “neutral” investors. The oil giant had believed relationships with these funds would avoid political tensions that would arise from associations with SWFs in other parts of the world.