BP Plc is expected to install an American troubleshooter as chief executive in the next 24 hours, replacing Tony Hayward, who has come under fire for his handling of the worst oil spill in U.S. history.

Bob Dudley, the U.S. executive managing the response operation to the spill in the Gulf of Mexico, is poised to get the top job in a move that could soften U.S.-led attacks on the British oil major, sources close to the company say.

Shares in BP, which has lost 40 percent of its market capitalization since the April 20 blast that caused the spill, had risen 2.5 percent to 408.5 pence by 1254 GMT.

The new chief executive is likely going to be an American. It's a political issue. That'll probably serve them well with a Yank in charge in the short term, one London-based trader said.

A statement from BP on Monday dropped its previous insistence that Hayward remained chief executive officer with the full support of the company's board and management.

BP notes the press speculation over the weekend regarding potential changes to management and the charge for the costs of the Gulf of Mexico oil spill. BP confirms that no final decision has been made on these matters, it said.

If Hayward goes, he will be the third of the last four BP chief executives to be forced to stand down early. John Browne left after lying in court papers about a gay love affair, and Bob Horton was pushed out over strategic disagreements in 1992.

The sources said BP's board, meeting in London on Monday evening, would discuss a plan for the exit of Hayward, a geologist whose ill-chosen comments have further fanned American fury over the crisis.

The boardroom drama unfolds as the company prepares to report an eye-popping second-quarter loss on Tuesday, as it accounts for the financial impact of the environmental catastrophe, which at its worst has lopped $100 billion from BP's market value.

Hayward, 53, was pilloried in the United States for complaining he wanted his life back weeks after the April 20 explosion at the Deepwater Horizon offshore rig killed 11 workers.

Angry American lawmakers also lambasted him at a congressional hearing where he was accused of ducking responsibility for the spill.

While potential change at the top has been persistent and will not surprise many -- the timing will, Morgan Stanley analysts said. We view any change as BP signaling it is getting better line of sight on containment and then the subsequent killing of the Macondo well.

Dudley, who was raised in Mississippi, would be the first non-Briton to become CEO of BP. He was previously head of BP's Russian joint venture, TNK-BP, until he was forced to flee the country amid a spat between BP and its oligarch partners.

In order to give the new CEO a fighting chance, we expect BP to write down the $20 billion clean-up costs this quarter. We therefore anticipate that the company will post a loss in the order of $15 billion this quarter, Arbuthnot analyst Dougie Youngson told clients in a note, maintaining his sell rating.

Analysts at Barclays bank said BP could report a loss for the second quarter of $13 billion as it makes provisions of up to $25 billion for the cost of the spill. Those figures would far exceed an expected 77 percent jump in underlying profit.

PLUGGING THE LEAK

With the well sealed since July 15 by a temporary cap, the board's concern has shifted to market preoccupation over Hayward's future, which is making it hard for the company to move forward, the sources said.

The imminent decision on Hayward's departure comes despite BP stating, as recently as Friday, that the board was not even discussing the matter. BP's reputation has in part been damaged by accusations it has been less than frank in its statements.

Under BP's terms of employment, Hayward would be entitled to one year's salary, or 1.045 million pounds ($1.6 million), and he could be in line for additional payouts under the company's incentive scheme, which awards shares options.

Hayward would also keep his pension entitlements, which were worth 10.8 million pounds at the end of last year.

Improving weather after a storm in the spill zone allowed work to resume on drilling a relief well to permanently plug the leak, which has spewed millions of gallons of oil into the Gulf over three months.

A Transocean Ltd rig was reconnecting equipment, a BP spokeswoman said. Vessels that had left the area on Friday to avoid Tropical Storm Bonnie were also returning.

Once the last bit of pipe is cemented in place near the bottom of the relief well this week, BP will begin a static kill in the first week of August, the head of the U.S. spill response, Thad Allen, told reporters on Sunday.

That entails pumping heavy drilling mud and cement into the well from the top to seal it off once and for all.

(Additional reporting by Kristen Hays in Houston and Dominic Lau in London; Writing by JoAnne Allen and Michael Shields; editing by Doina Chiacu, Lin Noueihed and Will Waterman)

($1=.6473 Pound)

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