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Monday, 2 December, 2002, 07:23 GMT
BP 'held inquiry into climbdown'
Lord Browne, chief executive, BP
Lord Browne: inquiry went "right to the bottom" of BP
The boss of UK energy giant BP has said he ordered an inquiry into how the firm was forced to slash its forecasts for oil and gas output three times in less than two months.

BP chief executive Lord Browne told a parliamentary committee he had ordered directors to bypass middle management, the Financial Times reported.

Instead, he told them to go straight to junior managers at BP's grass roots to discover the true state of the organisation.

Lord Browne said the inquiry was held to "make sure information is absolutely pure and not in any way distorted by trying to put things in a favourable light".

Disappointment in City

BP's third adjustment to its full-year 2002 oil and gas output forecast pushed its shares down more than 7% to close below 4 for the first time in four years in when it was released in October.

BP said in October it expected output to grow by 3% this year, compared to a 5.5% target in August.

Alongside lowered output targets, BP unveiled a 13% drop in profits for the three months from July to September.

BP, the world's second biggest energy firm, disappointed the City of London with net profits of about $3bn (2bn) - well below analysts' expectations.

'Disenfranchised'

Lord Browne, who was addressing a parliamentary committee investigating the UK government's use of target-setting, said BP's unit managers were asked to sign a pledge that information was accurate.

"It is important that they stand there and say, 'This is my opinion and no one else's'," he said.

He said the decision to go "right to the bottom of the organisation" to find out what went wrong had left some managers higher up "feeling very disenfranchised".

Analysis of the oil market, OPEC, and the alternatives

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29 Oct 02 | Business
30 Jul 02 | Business
30 Apr 02 | Business
18 Jan 02 | Scotland
10 Jan 02 | Business
09 Jan 02 | Business
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