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Chairman’s
letter
Dearfellowshareholder
2010wasaprofoundlypainfulandtestingyear.In
April,atragicaccidentontheDeepwaterHorizon
rigclaimedthelivesof11menandinjuredothers.
Aboveallelse,Iwanttorememberthosemen,
andsaythatourthoughtsremainwiththeir
familiesandfriends.BP’spriorityistoensurethat
thepeoplewhoworkforus,andwithus,return
homesafely.Theaccidentshouldneverhave
happened.Weareshockedandsaddened
thatitdid.
Thespillthatresultedcausedwidespread
pollution.Ourresponsehasbeenunprecedented
inscale,andwearedeterminedtoliveuptoour
commitmentsintheGulf.Wewillalsodo
everythingnecessarytoensureBPisacompany
thatcanbetrustedbyshareholdersand
communitiesaroundtheworld.
InthedaysaftertheaccidentintheGulfofMexicothecompanyfaced
acomplexandfast-changingcrisis.Withoilescapingintotheocean,
uncertaintygrewaroundourabilitytosealthewellandrestoretheareas
affected.Thiswasanintenseperiod,withthesituationworseningalmost
daily.OurmeetingwithPresidentObamaon16June2010provided
reassurancetotheUSgovernmentthatBPwoulddotherightthinginthe
Gulf,andthismarkedaturningpoint.Throughdiligenceandinvention,our
teamsstoppedtheowofoilinJulyandcompletedrelief-welloperations
inSeptember.
Duringthesedifcultdaysyourboardfocusedonthree
criticalobjectives.
First,weensuredtheresponseteamhadtheresourcesitrequired
tostoptheleak,containandcleanupthedamage,andprovidenancial
supporttothoseaffected.Thiswasanunprecedentedresponsetoan
industrialaccident,withsome48,000peopleinvolvedattheheightofthe
effort.Wehavesetupa$20-billionfundtoshowourwillingnessand
capacitytopayalllegitimateclaimsforcompensation.Forthelongterm,
wehavecommitted$500milliontoa10-yearindependentresearch
programmethatwillexaminetheenvironmentalimpactoftheoilspilled
anddispersantsused.BPwillcontinuetohelprestoretheenvironmentand
economyoftheGulf,howeverlongthattakes.
Second,weresolvedtounderstandwhathappenedonandbelow
theDeepwaterHorizon,toapplythelessonslearnedandtomakeour
ndingsavailablepublicly.BP’scomprehensiveinternalinvestigation
concludedthatasequenceoffailuresinvolvinganumberofdifferent
partiesledtotheexplosionandre.
Weareimplementingthereport’srecommendations.Wehave
establishedapowerfulsafetyandoperationalriskfunction,andwehave
enhancedriskmanagementthroughtherestructuringofourupstream
business.Wearealsoconductingawide-rangingreviewofwhenand
howweoutsourceoperations.
Third,wemovedtosecurethelong-termfutureofBPandour
capacitytomeetournancialresponsibilitiesintheGulfofMexico.
DecisiveactionwasrequiredherebecauseeventsintheUSledtoa
crisisofcondenceinBPwithinthenancialmarkets.Inresponse,we
madethedifcultdecisiontocancelthreedividendpayments.Wedonot
underestimatetheeffectofthisonsmallandlargeshareholdersalike.
However,thereisnodoubtinmymindthatthisactionsteadiedand
strengthenedourpositionatacriticalpoint.
Iampleasedthatwehavebeenabletoresumedividend
paymentspromptly.Thedividendforthefourthquarterof2010,tobepaid
inMarch2011,is7centspershare(US$0.42perADS).Thescripdividend
programmeapprovedlastyearisinoperationonceagain,andthispresents
anopportunitytotakethedividendinsharesorADSsratherthancash.We
intendtoraisethelevelofthedividendasthecompany’scircumstances
andperformanceimprove.
6 BPAnnualReportandForm20-F2010