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BP CEO defends deepwater drilling

BP, the government and an army of volunteers are fighting to contain and clean the millions of gallons of oil spewing from the site of the Deepwater Horizon explosion in the Gulf of Mexico.

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From Wire Services
Monday, October 25, 2010; 10:05 PM

LONDON - BP chief executive Bob Dudley defended potentially dangerous deepwater drilling Monday, even as he tried to strike a penitent note for the devastating Gulf of Mexico spill in his first external address since taking the top job.

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The American also stressed British Petroleum's commitment to the United States despite the ongoing political and public fallout there and talked up the company's ability to withstand the expected financial hit from the spill.

He declined, however, to testify before the House Energy and Commerce Committee about the Gulf oil spill, according to Representative Edward J. Markey, a Massachusetts Democrat.

Dudley cited an "enormous amount of work to do" in taking over as CEO and the need to focus on the company and the safety of its workforce, according to an Oct. 22 letter from the company that Markey released Monday.

Speaking at the annual conference of Britain's leading business lobby group, Dudley said that deep waters are becoming an increasingly important source of energy to fuel the global economy amid predictions that the world could be consuming 40 percent more energy than today by 2030.

"We are one of only a handful of companies with the financial and technological strengths to undertake development projects in these difficult geographies," he said at the Confederation of British Industry's gathering in central London. "And it can be done safely."

Deepwater drilling is projected to grow to account for 9 percent of total oil supplies in 2020, from 7 percent currently.

President Obama recently lifted a moratorium on new deepwater drilling in the Gulf, imposed after the April 20 explosion that kicked off the worst oil spill in U.S. history.

Dudley, who took over from Tony Hayward early this month, also sought again to reassure business leaders that the company has the financial strength to shoulder the anticipated heavy costs of the Gulf spill.

"Our underlying operational and financial performance is sound," he said, stressing the company's wide geographical reach. To help cover the costs of the spill, BP has begun shedding assets around the world, with a goal of raising $30 billion. On Monday it announced that it has sold its stake in four mature oil and gas fields in the Gulf of Mexico to Marubeni Oil and Gas for $650 million.

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