Bonuses for BP directors despite spill

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Two senior directors at BP will still be paid bonuses for last year, despite the Deepwater Horizon explosion in April which killed 11 people and resulted in the worst oil spill in US history.

Although the chastened oil major's remuneration committee ruled out any bonuses based on group-level results because of the Gulf of Mexico tragedy, chief financial officer Byron Grote and head of refining and marketing Iain Conn were judged to have exceeded their "specific segment targets" for the year.

Grote will be paid an extra US$621,000 ($841.830), and Conn an extra £310,500 ($685,174), taking their total pay packages to US$2.01 million and £1.04 million respectively, both some way from their 2009 totals.

No other BP executive will be paid a bonus, and there is no vesting of the 2008-10 share element for any director, according to the annual report published yesterday.

"Remuneration decisions for 2010 were dominated by the scale and impact of the accident in the Gulf of Mexico," DeAnne Julius, the chairman of the remuneration committee, said. "In the judgment of the committee and the CEO this overrode the normal metrics for bonus outcomes."

Robert Dudley - who took over as chief executive from Tony Hayward at the start of October - saw his basic pay rise from US$750,000 to US$1.2 million, in recognition of his promotion to the top job.

But the total package of US$1.7 million will be less than last year, with the 2009 bonuses included.

Hayward and Andy Inglis, the former head of exploration and production who also stepped down after the disaster, were paid contractual entitlements of a year's salary but neither was awarded any bonus for the year.

Even for Conn and Grote, a third of the bonus is deferred into shares that will vest in three years' time, subject to meeting safety and environmental hurdles in the meantime.

Dudley will not receive a pay rise this year. But Conn and Grote will see an increase - of £40,000 and US$62,000 respectively - because they have had no raise since July 2008.

BP had its first annual losses in nearly 20 years last year, dropping £3 billion into the red, compared with £9 billion in profits the previous year.

In the aftermath of Deepwater Horizon, Dudley is working hard to drag BP back to business as usual.

The company signed a US$7.2 billion deal with India's Reliance Industries last month and is also pursuing a US$10 billion tie-up with Russia's Rosneft.

- INDEPENDENT