(Alliance News) - Ascent Resources PLC said on Monday that it has introduced a series of cost-cutting actions amid a raft of board changes, which included the appointment of a new chief executive and a new chair.
The oil & gas company said it is aiming to reduce net monthly cash outflows by 50% after its ongoing court case against the Slovenian government delayed production increases at the Petisovci field.
The claim relates to the insistence of the Slovenia Environment Ministry that Ascent needs an environmental impact assessment for its Pg-10 and Pg-11A wells. It will be pursued in both Slovenian and international courts, the company said.
In its Slovenian operations, Ascent said it will cut the number of its employees and halt "all non-essential expenditure", including its May order of compression equipment for the Pg-10 and Pg-11A wells.
At an executive level, the company has reduced board and management pay.
Chief Operating Officer John Buggenhagen has been appointed as chief executive, replacing Colin Hutchinson. Buggenhagen is a geophysicist who served as CEO of Palomar Natural Resources and exploration director of San Leon Energy PLC. He was appointed to an operating role with Ascent in January and joined the board a month later. Hutchinson will remain with the company on a part-time basis as a finance director on an interim basis.
Also departing the company's board is Cameron Davies, retiring as chair having been a company director since 2010.
Louis Castro, who was once the finance chief of Eland Oil & Gas PLC, joins Ascent as a non-executive chair.
Buggenhagen said: "I am delighted to lead Ascent going forward. While the ongoing permitting delays at Petisovci have been frustrating, the board strongly believes that the key to the future of the company lies in regional diversification of the portfolio. We continue to pursue an appeal against the Environment Ministry in Slovenia, in conjunction with our joint venture partner at Petisovci, and we are prepared to initiate legal action against the Republic of Slovenia, who we believe is in breach of European Union law.
"Following the corporate review of the business, the board agreed that it was necessary to reduce the company's overheads by implementing various cost reduction initiatives. Costs will be reduced at every level within the company," he added.
Despite cutting costs, Ascent said it assessing "several opportunities which offer the potential of near term production" in Slovenia, as part of its strategy to grow the business.
Shares in the company were down 12% at 0.26 pence each in London on Monday morning.
Ascent Resources (AST)
San Leon (SLE)