BP CEO Tony Hayward testifies about BP oil spill in the Gulf at House Energy and Commerce Committee hearing on Capitol Hill in Washington
BP CEO Tony Hayward testifies about BP oil spill in the Gulf at House Energy and Commerce Committee hearing on Capitol Hill in Washington

Troubled energy giant BP has announced that it made a loss of over $17 billion in the second quarter of the year, thanks to the disastrous impact of the oil spill in the Gulf of Mexico, which started in April and has confirmed that CEO Tony Hayward will be stepping down in October.

In the second quarter last year the group made a profit of $4.3 billion, while in the first quarter of this year the group made a profit of $6.0 billion.

Overall in the first half BP made a loss of $11 billion compared with a profit of $6.9 billion in the same period last year.

The energy giant said that the cost of the stopping, cleaning up and compensating for the oil spill had reached $32.2 billion.

Total capital expenditure in the second half was reported as being $6.2 billion and was $10.9 billion in the half year, while the group made $0.7 billion from disposals in the quarter and $0.8 billion in the half year.

At the end of the second half BP's net debt was $23.2 billion, down from $27.1 billion at the same time last year.

BP also said that its CEO Tony Hayward would be stepping down on October and will be replaced by Robert Dudley, who is currently overseeing the cleanup operation of the oil spill in the Gulf of Mexico.

Carl-Henric Svanberg, Chairman of BP, said, "The BP board is deeply saddened to lose a CEO whose success over some three years in driving the performance of the company was so widely and deservedly admired.

"The tragedy of the Macondo well explosion and subsequent environmental damage has been a watershed incident. BP remains a strong business with fine assets, excellent people and a vital role to play in meeting the world's energy needs. But it will be a different company going forward, requiring fresh leadership supported by robust governance and a very engaged board.

"We are highly fortunate to have a successor of the calibre of Bob Dudley who has spent his working life in the oil industry both in the US and overseas and has proved himself a robust operator in the toughest circumstances,"

Tony Hayward said, "The Gulf of Mexico explosion was a terrible tragedy for which - as the man in charge of BP when it happened - I will always feel a deep responsibility, regardless of where blame is ultimately found to lie.

"From day one I decided that I would personally lead BP's efforts to stem the leak and contain the damage, a logistical operation unprecedented in scale and cost. We have now capped the oil flow and we are doing everything within our power to clean up the spill and to make restitution to everyone with legitimate claims.

"I believe the decision I have reached with the board to step down is consistent with the responsibility BP has shown throughout these terrible events. BP will be a changed company as a result of Macondo and it is right that it should embark on its next phase under new leadership."

Robery Dudley said, "I am honoured to be given the job of rebuilding BP's strengths and reputation but sad at the circumstances. I have the greatest admiration for Tony, both for the job he has done since he became CEO in 2007 and for his unremitting dedication to dealing with the Gulf of Mexico disaster."

"I do not underestimate the nature of the task ahead, but the company is financially robust with an enviable portfolio of assets and professional teams that are among the best in the industry. I believe this combination - allied to clear, strategic direction - will put BP on the road to recovery."

BP confirmed that Mr Hayward was likely to be nominated as a non-executive director at BP's Russian joint venture TNKL-BP and added that he would be receiving a year's salary of £1.045, as he is entitled to in his contract.