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Buccaneer drops heads Fires Alaska president, appoints two board members and ends a farm-out deal Eric Lidji For Petroleum News
Buccaneer Energy Ltd. has replaced its top two men in Alaska.
The Australian independent recently fired Jim Watt and Allen Huckabay, the president and the vice president of exploration and development of its local subsidiary Buccaneer Alaska LLC, the company announced on Dec. 16. Former Chief Operating Officer Andy Rike has taken over as president and former Chief Geologist Mike FitzGerald has taken over as vice president of exploration and development, according to the company.
Buccaneer declined to say why it made the changes, but Buccaneer Energy Chief Executive Officer Curtis Burton described the moves as “positive steps” amid broader efforts to focus on Cook Inlet. “With our new board members now firmly in place we are taking steps to streamline operations, reduce capital expenditures and accelerate our overall development plan,” Burton said in a statement. “I welcome Andy and Mike to their new roles and believe these will be positive steps for the company. Buccaneer Energy continues with its commitment to its Alaska projects, both on and offshore, and is looking forward to implementing these measures to drive our projects forward.”
In early December, Buccaneer resolved months of complications by appointing Patrick O’Connor and Gavin Wilson to fill two vacancies on its five-member board of directors.
In July, shareholders ousted two of the four existing directors and voted three new directors onto the board. A pair of corporate shareholders had called for the vote in an attempt to change the direction of the company. A subsequent appointment split the six-member board evenly among those seeking change and those looking to stay the course.
The three new directors subsequently resigned in August, without offering any public explanation. A series of other changes left the company without enough board members to satisfy Australian corporation law. The Australian Stock Exchanged suspended trading for the company from Dec. 2 until Dec. 4, when Buccaneer appointed its new directors.
Ending farm-out deal Even with those personnel matters sorted out, Buccaneer still faces challenges.
The company is currently working to keep two offshore Cook Inlet units. The Alaska Department of Natural Resources is threatening to terminate the Southern Cross and North West Cook Inlet units because Buccaneer failed to meet work commitments.
Buccaneer is asking the department for clemency. The company blamed the delays on logistical problems largely outside its control, but claims to have made “good faith, diligent efforts” to drill at both units this year and believes it will succeed next year.
Those efforts might be complicated by Buccaneer’s recent decision to end a farm-out agreement with the California-based independent EOS Petro Inc. In a statement, Buccaneer said it ended the deal because “amongst other things, failure by EOS to fund its obligations under the agreement.” Buccaneer declined to elaborate on the reason it terminated the deal and officials at EOS Petro could not be reached for comment.
Under a deal announced this past August, EOS Petro agreed to spend between $150 million and $200 million to fund at least six wells at three Buccaneer units in return for a 50 percent working interest in the properties. The deal called for EOS Petrol to fund two wells each at Southern Cross, at a Buccaneer-operated deep oil prospect at the ConocoPhillips-operated North Cook Inlet unit and at the onshore West Eagle unit in the southern Kenai Peninsula, with an option to fund two wells at North West Cook Inlet.
While declining to discuss how the end of the deal might impact its Cook Inlet plans, Buccaneer Chief of Public Relations and Communications Richard Loomis told Petroleum News, “We continue with our commitment to developing our Alaskan assets.”
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