Aussie energy company Santos starts shakeup

ADELAIDE, Australia, Sept. 17 (UPI) — While announcing a board shakeup, Australian energy company Santos said Thursday it was vetting interests from other entities eyeing its assets.

The board at Santos said Chief Executive Officer David Knox will step down once a successor is named after seven years at the helm. Knox will stay on in the interim, though Chairman Peter Coates will take on more responsibilities.

“We are undertaking a thorough strategic review of all options to restore and maximize shareholder value in the face of the continuing pressures on oil prices, globally,” Coates said in a statement.

Santos in August said net profit for the first half of 2015 at $37 million was 82 percent lower year-on-year. Capital expenditure was down by more than half from the same period in 2014, reflecting the substantial slump in crude oil prices.

The company in July said it was maintaining its production guidance moving forward despite reductions in capital and operating expenditure. During the second quarter, the company produced 14.3 million barrels of oil equivalent, 12 percent higher year-on-year, and posted sales volumes of 15.7 million boe, 4 percent higher year-on-year. Sales revenue, however, fell 19 percent.

Coates said the company has a portfolio of high-quality assets and shareholder values needs to be protected. Though no short-cuts are on the table, the chairman said all options are on the table.

“We will be talking with the parties who have approached us to date with interest in various assets and other strategic initiatives and with this announcement there may well be new expressions of interest received,” he said.

The company said it was taking the “appropriate steps” to cut operating costs. For full year 2015, Santos is targeting $180 million on supply chain savings.

Santos boasts strong operational performance from its liquefied natural gas portfolio, particularly from its LNG project in Papua New Guinea.