- Associated Press - Wednesday, July 7, 2010

DUBAI, United Arab Emirates (AP) — BP’s embattled CEO flew to the wealthy emirate of Abu Dhabi to meet officials amid speculation the oil giant is looking to raise cash to cover clean up costs from the Gulf of Mexico oil spill.

Chief Executive Tony Hayward arrived in the Emirati capital Tuesday and would be staying “a couple of days,” BP spokesman Andrew Gowers said. He would not say whether Mr. Hayward planned to sit down with the region’s powerful investment funds, which have provided needed cash to Western multinationals in past times of crisis.

“He’s visiting partners as he does from time to time. He’s conducting normal business,” Mr. Gowers said.

Mr. Hayward has been criticized for his handling of the oil spill in the U.S., and in recent days traveled to other countries where BP operates to reassure the company’s partners of its commitments.


BP has a long-standing partnership with the state-owned Abu Dhabi National Oil Co., which is responsible for crude oil production in the Arab emirate.

Abu Dhabi is the capital of the seven-state UAE federation, and holds the bulk of the OPEC member’s oil wealth. Power rests with the family of the emirate’s hereditary ruler, who is also the UAE’s president.

Mr. Hayward’s visit comes as speculation swirls that BP might be looking for investment partners from the Middle East.

The company’s shares rose earlier in the week amid reports it was reaching out to Gulf funds about investment opportunities in an attempt to fend off possible takeover bids.

Abu Dhabi is home to several of the Arab Gulf’s most influential sovereign wealth funds, including what is believed to be the world’s biggest. Officials in the emirate have not commented publicly about investing in BP.

In the latest twist, Saudi daily al-Eqtisadiah reported Wednesday that a delegation of Saudi investors was headed to London to discuss an acquisition of up to 15 percent of BP. The report didn’t say where it got the information, and could not be independently confirmed.

BP said this week it would welcome new investors but had no plans to issue any new shares to help pay for the oil spill.

BP shares have lost about half their value since the Deepwater Horizon oil rig exploded in April, causing the worst offshore oil spill in U.S. history.

Saud Masud, head of Middle East research at Swiss bank UBS, said a deal between BP and Mideast government funds, which tend to be passive, long-term investors, would make sense for both sides.

“Any time you have a 50 percent drop in a stock price, people will take notice of it,” he said. “There are several Middle East investors who could be interested.”

Kuwait’s sovereign wealth fund, the Kuwait Investment Authority, already ranks among BP’s biggest shareholders. It holds a 1.8 percent stake in the oil giant.

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