Processing Magazine

BP freezes severance payments to ex-CEO

July 10, 2007

According to the Associated Press, BP PLC has temporarily frozen severance payments worth around 2 million pounds (US$4 million; euro2.9 million) owed to former Chief Executive John Browne and former refining chief John Manzoni. Shareholders sought the freeze as part of a U.S. lawsuit seeking damages for alleged mismanagement by executives. According to the legal action, filed in the U.S. state of Alaska last October, shareholders were concerned they would not be able to recover money from Brown and Manzoni in the event they won the court case. They are seeking unspecified damages from 39 current and former BP executives and directors after a series of blunders at the company, including a spill at the Alaska Prudhoe Bay pipeline last year and a deadly Texas refinery explosion in 2005. BP said it had voluntarily decided to withhold payments worth more than 1.5 million pounds (US$3 million; euro2.2 million) to Browne and payments of almost 500,000 pounds (US$1 million; euro740,000) to Manzoni for 60 days while the court case is resolved. The freeze does not relate to the pair''s pension packages. Browne stepped down in May when he was replaced by exploration and production head Tony Hayward. Manzoni left his position as refining head at the same time but is still a managing director with company until September.