ADELAIDE, Australia, April 1 (UPI) — Australian energy company Santos said Friday it drafted a new team of executives tasked with setting up an operating model to navigate the low oil price era.
The company said it appointed six new members to an executive team with expertise ranging from exploration to capital development. Reporting to CEO Kevin Gallagher, the company said top management would work to move Santos through the depressed market.
“The appointment of the executive team is a key step in establishing a new operating model for Santos that is focused on both lifting productivity and driving long-term value for shareholders in a low oil price environment,” Gallagher said in a statement.
David Knox stepped down as CEO of the company in 2015 after seven years on the job. Marking his departure, he said the move was appropriate as the company takes the “appropriate steps” to cut operating costs.
The company last year reported heavy losses in net profits and capital expenditures, reflecting the substantial slump in crude oil prices. Oil prices have been relatively stable, hovering at or near $40 per barrel for several weeks. The price, however, is more than 60 percent below peak levels from 2014.
Chinese gas distributor ENN Group introduced a proposal last month to take in 11.7 percent in the shares in Santos held by Hony Capital. ENN is the largest gas distributor in China.
Santos leads an $18.5 billion project designed to convert coal seam natural gas to liquefied natural gas for exports to the global market. The Curtis Island LNG project is fed by a 260-mile underground pipeline from the Bowen and Surat basins in Queensland.
Gallagher said the new business would move the company away from a geographically-based model to one more focused on the exploration and production side of the energy sector.
“We will manage our asset portfolio in a manner which delivers value to Santos shareholders,” he said.