Hurricane Energy Plc (LON:HUR) shares dropped around 20% in Monday’s early deals as the UK offshore oiler announced the resignation of chief executive Dr Robert Trice.
It comes as the Lancaster oil field’s early production system (EPS) was put on technical review following a period of problems and reduced output.
Since May 17, the Lancaster EPS has produced at a steady state of around 10,300 bopd from just the 205/21a-6 well – one of two wells in the EPS – and the water cut is said to be around 8%. On June 5, the production rate was lifted to 12,000 bopd as the well’s choke size was increased and it continues to be monitored.
Previously, the EPS was reduced to one well as water volumes increased substantially and Hurricane was unable to achieve targeted plateau production rates, of 18,000 bopd.
Hurricane has now established a technical committee to be chaired by non-executive director Dr David Jenkins, and, it also established a committee for ESG (Environmental, Social, and Governance) matters.
The company told investors that the technical committee will conduct a review of all available information, including recent dynamic performance data, and will re-examine the full range of possible geological and reservoir models.
Its findings will be incorporated into an updated competent persons report, anticipated in the first quarter of 2021.
Beverley Smith has been appointed as Hurricane’s new interim chief executive. She joined the company as non-executive director back in December and her 30-year career to date has included roles at BG Group.
Richard Chaffe has been confirmed as Hurricane’s chief financial officer – he previously joined the company as head of finance back in 201 and has been acting CFO since February.
At the same time, there have been changes to the representation of private equity investor Kerogen Capital on Hurricane’s board with former senior Shell geologist Dr Alan Parsley replacing Roy Kelly as one of Kerogen’s nominated non-executive directors.
Chairman Steven McTiernan, in the statement, said: “As we move into a phase where the focus is on enhancing production, I am very pleased that Beverley has taken on the role of interim CEO where her extensive subsurface and development experience will be of huge benefit to the company.
“In evaluating options for the forward work programme against an uncertain macroeconomic backdrop, we will prioritise early low-cost production with the capital discipline needed to achieve financial resilience.”
McTiernan, meanwhile, commented: “The Board commends Dr Trice’s pioneering efforts to explore the viability of the unique basement oil play west of the Shetlands. His dedication over a period of 16 years has built Hurricane into a recognised UK operator today, culminating in the outstanding success of delivering first oil in May 2019.”
In London, Hurricane shares recovered somewhat from the initial shock and were changing hands at 8.24p marking a drop of around 8.6%.
Published at Mon, 08 Jun 2020 07:34:00 +0000-Hurricane Energy launches technical review of Lancaster project as CEO resigns