BP’S merger with US rival Amoco was just the latest – and biggest – development for this constantly evolving global business giant. Since 1 January, BP Amoco has functioned as a single entity, spanning most regions of the world in exploration and production.
The group has a mass of legal talent, picked from both international and indigenous practices. It continues the strategy of both pre-merger businesses for keeping as much work as possible in-house – around 80-90 per cent.
Peter Bevan, BP group general counsel, is on BP Amoco’s management board and was closely involved in the merger. He now heads the enlarged legal function.
Part of the group since the early 1970s after his training at Kennedys, Bevan has seen huge changes.
“It’s been absolutely dramatic. The late 1970s and early 1980s were spent diversifying not only the oil and gas businesses, but also into other areas such as nutrition or computers. The late 1980s we spent divesting ourselves of these businesses.”
He has a natural feel for the international nature of the business, having worked for BP in places as far apart as the US and China.
BP Amoco is divided into three main businesses – upstream focuses on exploration, downstream incl-udes refining operations and delivery of product, and petrochemicals.
“The downstream industry has significant assets on the ground, so we need locally qualified lawyers,” says Bevan. “With upstream, our lawyers are typically international.”
Each of the businesses has its own team of lawyers dedicated mainly to operational work such as joint ventures, shipping contracts and so on.
In addition there are the “shared services lawyers” providing corporate skills in M&A, IP, litigation, anti-trust, competition, finance, labour law, and health and safety. This specialist team operates out of London, Chicago, Cleveland and Singapore. Its lawyers are typically from top corporate firms around the world.
“The vast majority of our lawyers are from private practice, including the bar, reflecting that we’ve become more specialised and so need top expertise,” says Bevan.
“We try to cover our core operation needs in-house. We do our oil and gas work almost exclusively in-house – but then if an oil and gas company couldn’t do that, it would be in real trouble.”
Bevan “relies very much” on six assistant general counsel – two for each of the business groups and also two regional general counsel – in the UK and Singapore. “We try to minimise formal reporting – it’s much more of an ad hoc thing,” he says.
BP Amoco uses law firms for lower-value regional work such as small real estate, and big, one-off corporate jobs. “Apart from cost, we choose firms because of the individuals within them,” says Bevan. “We want people who can act as an extension of the in-house team. Close working relationships are critical.”
Bevan now has the task of rationalising the legal function after its 20 per cent post-merger job cuts. Oil price weakness is an added pressure, forcing cutbacks where possible.
“In macro terms, the redundancy process has gone as well as it could. On a personal level, it’s upsetting, but intellectually people realise why it has to happen,” says Bevan.
He is also rationalising the number of law firms used globally, via an ongoing review. There is no strict panel as such. Apart from Linklaters, Mcgrigor Donald and Morgan Cole, some nine or 10 other top UK firms are sometimes used.
“Over the next few months we will compare panels,” says Bevan. “I would be surprised if we didn’t reduce the number.”
Head of legal and group general counsel
|FTSE 100 ranking||Number One- Britain’s biggest company|
|Legal function||Around 280 lawyers worldwide (after 20 per cent job cuts, mainly outside the UK)|
|Head of legal||Peter Bevan, group general counsel|
|Reporting to||Sir John Brown, chief executive officer|
|Main location for lawyers||Across 30 jurisdictions. Key centres include London, Chicago, Houston, Anchorage, Cleveland and Singapore|
|Main law firms||Linklaters, McGrigor Donald, Morgan Cole|