Shareholders overhaul Carnarvon board

The board of Carnarvon Energy has been overhauled by major shareholders, less than a week after the company put out a succession plan to guide the appointment of new directors.

Carnarvon said discussions with its two largest shareholders, Nero Resource Fund and Collins St Asset Management, were the catalyst for today’s changes including the immediate departure of chief executive and managing director Adrian Cook.

Nero founder and managing director Russell Delroy has been appointed to the board, alongside geologist William Barker who was once general manager LNG at Arrow Minerals and is currently executive director at Western Gas.

The company’s chief executive officer and chief operating officer roles will be merged, with current COO Philip Huizenga appointed into the consolidated role.

Carnarvon’s release to the ASX said the consolidation of CEO and COO roles had been in planning for some time.

Non-executive director Debra Bakker has also agreed to retire, with chair Bill Foster and fellow non-executive director Gavin Ryan both planning to retire by next year’s AGM as previously announced.

Carnarvon owns the Dorado oil field of Western Australia’s North West Shelf, which was the largest oil discovery in Australia in more than 30 years when uncovered by the company and Santos in 2018.

Earlier this year Carnarvon halved its stake in Dorado from 20 per cent to 10 per cent, selling part of its share to Taiwanese company CPC Corporation for $218 million.

The joint venture is working towards a final investment decision at Dorado in 2024. Carnarvon used its annual report release in August to vent frustration at Santos' progress on the project.

Carnarvon and its partners also discovered the Pavo North oil discovery in 2022.

The reconstituted board said it would take steps to preserve the existing balance sheet to protect Carnarvon’s ability to fund Dorado, slash the company’s corporate and administrative cost base following a comprehensive review, and maximise value from Carnarvon’s existing portfolio.

That includes acceleration of drilling plans in the Bedout sub-basin, and the potential sale of non-core assets.  

“These strategic priorities are focused on restoring and growing shareholder value,” the company said.

“Shareholders will be advised of all material developments in relation to this strategy.”

In a statement to the ASX, Mr Foster paid tribute to Mr Cook’s contribution to the company over a 12-year stint, and Ms Bakker’s role over the past three years.

“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 discovery in Australia in the last thirty years,” he said.

“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.”

Today’s announcement follows a board succession plan released by the company last week, which outlined the planned departures of Mr Foster and Mr Ryan.

The search for potential replacements for the two retiring directors is expected to be complete by the end of the March quarter 2024.

Carnarvon shares were up almost 12 per cent at 1.10pm AWST.