Ophir Energy Plc Ophir announces strategic update (6167A)
13 September 2018 - 4:00PM
UK Regulatory
TIDMOPHR
RNS Number : 6167A
Ophir Energy Plc
13 September 2018
13 September 2018
Ophir Energy plc
("Ophir")
Ophir announces strategic update
Build a strong foundation of Production & Development in SE
Asia
Transition to an Asian HQ, London office to be significantly
downsized
Evaluate attractive consolidation opportunities
Unlock the potential value in LNG assets
Following his appointment as interim CEO in May 2018, and the
recently closed Santos production acquisition, Alan Booth and the
Board have reviewed and agreed the key next steps to enable Ophir
to deliver the inherent value in its asset base and maximise value
for shareholders.
Ophir, as announced today in half year results for the six
months ended 30 June 2018, has an operating asset base capable of
delivering free cash flow of $300 million over the next three
years, a strong operating capability and potentially valuable gas
assets in Equatorial Guinea and Tanzania. In order to accelerate
progress toward sustainability and shareholder returns, the Board
is taking the following steps:
- Continue to build a strong, cash generative production and
development base to serve as the platform for further growth and
shareholder returns. The recent asset acquisition from Santos was
the first step in this direction, significantly increasing the
Company's free cash generation. Delivering material free cash flow
to drive net asset growth and returns to shareholders is the
priority.
- Minimise Ophir's exposure to frontier exploration. Focus on
nearer field exploration opportunities that can drive production
growth and/or extend field life.
- Selectively evaluate opportunities for consolidation that
could rapidly and effectively deliver our objectives of
materiality, sustainability and shareholder returns.
- Consider options to unlock the potential value in our LNG
assets - value that is not today reflected in our share price
despite a rapidly improving LNG landscape. We intend to ensure that
our shareholders share appropriately in any value subsequently
realised.
- Take further action to right size the cost structure of the
business. We propose to downsize our London office, following
workforce consultation, and within 12 months establish a fit for
purpose Asian based HQ to serve as the hub for our ongoing
business, generating material cost savings.
The search for a new CEO is underway. All potential candidates
have strong operational, leadership and commercial skillsets. The
Board will expect the successful candidate to execute the above
strategic priorities. With Asia becoming the hub of our operations,
it is likely that the new CEO will be based in the region.
The Board believes that these actions will create a focused,
efficient business generating a significant amount of free cash
flow and will provide a strong platform from which the new CEO will
be able to grow the business, as well as consider other capital
allocation options.
A presentation for investors and analysts will be held at 9.30am
this morning. A webcast of the event will be available on the
company's website: www.ophir-energy.com/investors and a dial in is
available using the following number: +44 (0)330 336 9411.
For further enquiries, please contact:
Ophir Energy plc + 44 (0) 20 7811 2400
Geoff Callow, Head of IR and Corporate Communications
Brunswick (PR Adviser to Ophir) + 44 (0) 20 7404 5959
Patrick Handley
Wendel Verbeek
About Ophir:
Ophir Energy is an independent Upstream oil and gas exploration
and production company. It is listed on the London Stock Exchange
(LEI: 213800LAZOZTKPAV258).
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END
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