Oil Search Boss to Retire in 2020
Papua New Guinea's biggest company Oil Search Ltd said on Tuesday long-serving Managing Director Peter Botten will retire from the firm next year after 25 years in the role, just as the company enters a major growth phase in PNG and Alaska.
Botten will be succeeded by senior executive Keiran Wulff in February and will step down from the board on Aug. 25.
"Under his leadership, Oil Search has grown from a small exploration and production company to a regionally significant oil, gas and LNG producer and exporter," Oil Search Chairman Rick Lee said in a statement.
Wulff currently leads Oil Search's operations in Alaska, where the company recently doubled its stake in a promising oil prospect and aims to make a final investment decision in 2020 on a roughly $5 billion project.
"It's pretty big shoes to fill. He was the most logical candidate. He's certainly well regarded," said Andy Forster, senior investment officer at Argo Investments, which owns Oil Search shares.
Botten is stepping down at a crucial time for Oil Search as its larger partners in two liquefied natural gas (LNG) projects in Papua New Guinea, Total SA (TTFNF) and Exxon Mobil Corp, look to push through a $13 billion plan to expand gas exports.
Oil Search's shares fell 1.9%, against a 0.6% drop in the S&P/ASX 200 energy index, reflecting some worry about Botten's retirement, even though it had been well flagged.
"His departure presents risks to the company's internal functioning alongside political and market engagement risks at a delicate point in Oil Search's growth trajectory," said Credit Suisse analyst Saul Kavonic.
However, Wulff said Botten has set up the company well for the transition, recently creating PNG and Alaska divisions and bringing in experienced international managers.
He also played down concerns that political issues in Papua New Guinea could stall an agreement with Exxon on development of the P'nyang gas field, which is needed before a final investment decision on the PNG LNG expansion.
"We're very confident. The reality is these projects are fundamental to Papua New Guinea long term and its aspirations ... to develop a broader based economy," Wulff told Reuters in an interview.
Botten fended off an $8 billion takeover approach in 2015 and the company is again seen as vulnerable to a bid as its share price has slipped amid the political ructions in PNG, but Wulff was undaunted at the prospect.
"At the moment some of the issues in Papua New Guinea have affected us a little bit, but frankly, we're well prepared for that. But we don't see that as an issue going forward," he said.
(Reporting by Aby Jose Koilparambil; Additional reporting by Sonali Paul; editing by Richard Pullin)