BP boss Browne pockets £4.8m

LORD BROWNE, chief executive of oil giant BP, pocketed a 22% increase and salary and bonuses last year as he led the oil giant to record profits and steered clear of the reserves crisis haunting rival Shell.

The supermajor's annual report, out today, shows that he received nearly £4.8m in salary, annual and long-term performance bonuses after the group's strong showing in 2003.

Browne, one of the best-paid executives in the City, will also be able to enjoy the high life when he eventually steps down. His mammoth pension pot after 37 years of service is now £13.9m.

While his ever-growing pension entitlement risks upsetting unions, analysts claimed the troubles engulfing Shell showed Browne was worth his lucrative pay. One said he accounts for up to 5% of BP's share price.

Sky-high oil prices during 2003 helped BP post record underlying profits of $12.38bn (£6.5bn) for the year, a 42% increase and a figure that beat its previous best of $12.2bn in 2000.

Browne's basic salary edged up to £1.3m. He was granted an annual bonus of £1.9m and earned £1.5m from BP's long-term scheme, which measures performance over a three-year period.

Bruce Evers, analyst at Investec, said: 'Browne has created serious value for his shareholders and is worth every penny. Compare it to what's going on at Shell...I mean, they shouldn't be paid.'

BP stunned the City early last year by setting up a joint venture with Russian group TNK in a bid to find new reserves and replace ageing fields in areas such as the North Sea.

Finance director Byron Grote earned a total $1.95m after an annual bonus of $1m, up 17%. John Manzoni and Tony Hayward, the two directors in the running to replace Browne if he steps down on retirement age in 2008, got £878,000 and £829,000 respectively.

Shell has yet to reveal the size of any payout for former chairman Sir Philip Watts. His salary and bonus for 2003 will be revealed in the group's annual report next week. He was paid almost £1.8m in 2002. He holds options on an estimated two million shares but at Shell's current market price of 380p he would be able to sell only 312,001 at a profit of £527,482.

In contrast to the supermajors, Cairn Energy chief executive Bill Gammell took home just £428,510 in

2002. Cairn's share price was up 1p at 875p today after yesterday's second major oil discovery this year.