Carnarvon Energy Ltd (ASX:CVN) has made a number of changes to its board and management team, while outlining strategic priorities focused on “restoring and growing shareholder value”.
Russell Delroy and William Barker have been appointed as non-executive directors with immediate effect.
In connection with their appointments, existing managing director and chief executive officer Adrian Cook and Carnarvon non-executive director Debra Bakker have agreed to retire from the board. Cook will immediately step down from the CEO role.
The positions of CEO and chief operating officer (COO) will be merged, with Carnarvon’s current COO Philip Huizenga appointed into the new CEO role. This change has been planned for some time and reflects Carnarvon’s progression from explorer to producer.
Carnarvon’s chair William Foster and non-executive director Gavin Ryan will remain on the board, with Foster and Ryan both intending to retire prior to, or at, the company’s 2024 AGM.
The changes follow discussions with Carnarvon’s two largest shareholders, Nero Resource Fund and Collins St Asset Management.
The reconstituted board will continue the search process to identify and appoint new, high-calibre, individuals to replace Foster and Ryan, and hopes to find potential replacements by the end of Q1, 2024.
Strategic objectives
Following the appointment of Delroy and Barker, the reconstituted board intends to:
- Preserve existing balance sheet strength - Commitment to no new material acquisitions. This will protect Carnarvon’s ability to fund Dorado and the primary underwriting of the company’s valuation. A strong balance sheet also provides optionality and patience in realising the right value outcomes from the existing asset base;
- Significantly reduce the corporate and administrative cost base - Materially reduce the administration and corporate cash costs of the business following a comprehensive review; and
- Maximise value from the existing asset base - Continue to support project development at Dorado in a fiscally conservative manner. Explore opportunities to realise value through a corporate sale or asset divestment via a coordinated process. The company will work with its joint venture partners to seek to accelerate drilling of the highest priority targets in the Bedout Sub-basin. Carnarvon will also seek to execute upon opportunities to monetise non-core assets.
Carnarvon chair Bill Foster said: “I thank Adrian for his dedicated service to Carnarvon over the last 12 years and Debra for her contribution to the Carnarvon board over the last three years, in particular with regard to her close involvement with the Dorado financing arrangements.
“Adrian has been instrumental in Carnarvon’s journey from an onshore explorer and producer in Thailand, to a founding partner in the Dorado field, the largest offshore oil discovery in Australia in the last 30 years.
"With the further discovery of the Pavo field in 2022, Carnarvon is in the enviable position of holding an interest in the largest undeveloped oil and condensate resource offshore Australia, as well as the country’s most prospective exploration acreage in the form of the Bedout Sub-basin.
“We continue to work hard with our joint venture partners, Santos and CPC Corporation, Taiwan, to ensure the Dorado Phase 1 liquids development is FID ready in 2024, and our focus remains firmly on unlocking the significant value that development of Dorado and Pavo will realise for shareholders.”