BP panel review to use reverse auction as pitch requests extended to US advisers

BP has introduced an online reverse auction to its on-going panel review of external legal advisers, which is set to conclude in the coming weeks.

The oil major said the online reverse auction would make the bidding process “more transparent, quicker and more efficient”, and place a strong emphasis on cost efficiency and competitive rates.

In March, Legal Week first reported that BP had kicked off its review of external advisers in the UK, three years after spots were awarded to Linklaters, Freshfields Bruckhaus Deringer, Herbert Smith, Pinsent Masons, CMS Cameron McKenna, Norton Rose, Field Fisher Waterhouse and Olswang.

The UK review is being led by managing counsel Andrew Stewart, who has invited existing and potential firms to pitch.

“We would expect to see some new participants for our UK-instructed legal work, and it is possible that there may be some departures.”

“Financial discipline is a key part of BP’s strategy – that applies to our legal spend as much as project investments,” added group general counsel Rupert Bondy.

Separately, BP confirmed it is extending its panel review to the firms it works with in the US, with Bondy stating the US review will look to “realign rates”.

BP has had one of the highest legal bills of any global corporate in recent years, with the fallout from the 2010 Deepwater Horizon oil spill contributing to enormous legal costs in the US.

In 2012, BP told the Financial Times it expected to spend $1.7bn (£1bn) on lawyers and other administrative costs relating to Deepwater, with US firms including Kirkland & Ellis, Arnold & Porter and Wilmer Hale handling the majority of litigation and investigations work for the company in the US.

On this side of the Atlantic, the majority of corporate work is carried out by longstanding adviser Linklaters, although fellow panel firm Freshfields Bruckhaus Deringer has picked up an increasing number of mandates in recent years.

Key relationship partners for the oil major in the City include Freshfields’ corporate partner Mark Rawlinson, Linklaters global head of corporate Jeremy Parr, and James Palmer at HSF, who took over as relationship partner after his predecessor Paul Griffin left for Allen & Overy in 2010.

Last year, BP turned to Linklaters after the European Commission announced it was investigating the company over allegations of oil and biofuel price fixing.