Carnarvon has undergone significant changes during the financial year; however the Company is in a strong position to realise significant value from its asset portfolio, which features Dorado, Australia’s largest undeveloped liquids field.
The Company completed a partial divestment of its interests in the Bedout Sub-basin permits, including the Dorado production licence, to OPIC Australia Pty Ltd, a wholly owned subsidiary of CPC Corporation (CPC), Taiwan’s national oil company. We’re pleased to welcome a quality partner in CPC to the Joint Venture. Carnarvon’s divestment also means the Company is in an excellent financial position to fund its share of the Dorado development.
Carnarvon also made considerable progress towards its Board succession plan during the year. I was pleased to welcome Robert (Rob) Black, Russell Delroy and William Barker to the Carnarvon Board during the year. The new Board has a wealth of experience, a resolute focus on maximising shareholder value and has already made positive progress towards the Company’s revised strategic objectives.
I would sincerely like to thank Adrian Cook, Peter Moore, and Debra Baker, who retired from the board this year. They have provided considerable effort and guidance to Carnarvon over many years and leave the Company in a very strong position. I especially would like to thank Adrian for his many years of service as Managing Director, who was instrumental in the Company’s journey from an onshore explorer and producer in Thailand, to a founding partner in the world class Dorado field.
Following these changes, Philip Huizenga was appointed Chief Executive Officer (CEO), having served as Chief Operating Officer (COO) for a number of years. Phil’s appointment had been planned for some time and reflects Carnarvon’s progression from explorer to producer.
Phil hardly needs a welcome as CEO, despite only taking on that role recently, his active service to the Company over the past 15 years, primarily as COO, has meant he should be well known to all. I am confident that Phil has the support and skills necessary to take Carnarvon to development and production.
Carnarvon’s refreshed Board has refined the Company’s strategic objectives with a firm focus on preserving the company’s balance sheet strength, significantly reducing the corporate and administrative cost base, and maximising value from the existing asset base.
I am pleased with the progress that has been made towards these objectives during the period. Carnarvon continued to review and reduce its corporate and administrative costs, with ongoing costs now reduced by over 40% compared to the 2023 cost base. These cost reductions, in addition to a commitment to making no new material acquisitions, means Carnarvon is strengthening and retaining its robust balance sheet to deliver the Dorado development to a Final Investment Decision, and onto first oil.
Carnarvon is also resolutely focused on maximising value from its existing assets. The company continues to support the Dorado development and progressing exploration in the highly prospective Bedout Sub-basin. Carnarvon also remains open to exploring alternative transactions to accelerate value realisation and is working with J.P. Morgan to consider its strategic options.
Further to reducing the Company’s corporate and administrative cost base, the Board has revised the Board and Management’s remuneration structure. Fixed remuneration has been reduced for new Directors and the CEO, and performance rights have been granted to better align remuneration with shareholder interests, and to incentivise management to drive higher returns. Details of the remuneration structure are outlined in the Remuneration Report.
As announced during the year, I stepped down as Chair of Carnarvon on 1 July 2024, with Rob Black assuming the role. I intend to retire from my non-executive directorship once a suitable replacement has been appointed.
It has been a pleasure being on the Board of Carnarvon for the past 14 years, including Chair for nearly 4 years. It saddens me to leave the Company however I feel confident in leaving the Chair role to Rob, knowing he will provide excellent guidance to the Company in its next phase.
Finally, I would like to thank our shareholders for their continued patience over a number of years. I share your frustration with the time it has taken to progress the Dorado development, however I am confident that your patience and support will be rewarded in due course. I look forward to seeing the Company develop Dorado and continue to unlock the prolific Bedout Sub-basin as a fellow shareholder.
William (Bill) Foster
Chairman