BP CEO Browne Resigns

Lord John Browne, Chief Executive Officer of BP Group addresses the media, in this March 24, 2005 file photo, at City Hall in Texas City, Texas, regarding the explosion at their plant in Texas City that killed fifteen people. BP PLC's chief executive, John Browne, resigned Tuesday, May 1, 2007 only hours after a judge cleared the way for a newspaper to publish details of his private life. Browne had led the huge energy company for more than a decade. He had announced earlier this year that he would resign at the end of July. (AP Photo/Tony Gutierrez, file) (Tony Gutierrez - AP)

Browne rejected the allegations, calling them "full of misleading and erroneous claims. I deny categorically any allegations of improper conduct relating to BP."

BP said an internal investigation determined that those allegations were unfounded.

"The board of BP has accepted John's resignation with the deepest regret," Chairman Peter Sutherland said. He called it "a tragedy that he should be compelled by his sense of honor to resign in these painful circumstances."

Phil Flynn, an analyst at Alaron Trading Corp. in Chicago, said he thought the allegations against Browne were serious enough that, if proved true, the CEO would have been forced to resign even if BP had not faced other problems.

"If that's proven, then that in and of itself might be enough," Flynn said. "But, obviously, John Browne's reputation was already tainted."

Shares in BP edged lower after the announcement, closing down 0.4 percent to 563 pence ($11.24) on the London Stock Exchange.

Browne's decision will allow Hayward to start with a clean slate, analyst Jason Kenney of ING Group told Dow Jones Newswires. He said the news shouldn't affect the company's share performance, since Hayward already was selected to become the next CEO and the company's future strategy had been laid out earlier this year.

After more than a decade at the helm of BP, Browne _ a close associate of Prime Minister Tony Blair _ had announced in January that he would resign at the end of July, bringing his expected departure forward by more than a year.

Then his annual performance bonus for last year was cut almost in half as the oil spill in Alaska and the effects of the refinery explosion in Texas overshadowed record profits for the oil company.

Last month, BP reported a 17 percent drop in first-quarter earnings on lower oil prices and declining production.

Browne joined the company in 1966 as an apprentice and worked his way up to the top job in 1995. He oversaw BP's expansion into the United States, including the 1998 merger with Amoco and the subsequent acquisitions of Arco and Castrol.

Before the scandals, Browne was known as the man who turned BP around, Flynn said.