Santos Ltd. announced that highly respected energy and resources executive, Kevin Gallagher, currently CEO of engineering services group, Clough Ltd. (Clough), has been appointed as the new managing director and CEO of Santos.
Gallagher will aim to commence duties with Santos in early 2016, subject to agreement on a release date with Clough.
“[Gallagher] has nearly 25 years’ experience in managing oil and gas operations in Australia, the USA and North and West Africa,” said Peter Coates, Santos executive chairman. “He is ideally suited to lead Santos as we move from a focus on major strategic developments to delivering strong operational results in a continuing low oil price environment. [Gallagher] will bring fresh insight and a proven track record of achievement for shareholders from a career that spans international oil experience with Mobil, the Woodside operated North West Shelf LNG venture and most recently, as CEO of Clough since 2011.”
“At Clough, Gallagher is widely recognized for his achievements in driving strong financial performance in the face of increasingly tough conditions for resources industry service providers,” Coates said. “I have said through the course of this year that with the major LNG project investment phase ending and the oil price outlook remaining low, Santos had to take action to become a more agile, low cost producer delivering attractive shareholder value.”
“The company has made good progress towards that goal through the year with a US$900 million reduction in capex and circa $370 million per annum in cost savings through headcount reductions of some 770 positions, together with meaningful supply chain savings,” said Coates. “However, the strategic review which we have just completed has shown that we can further simplify the business and enhance financial discipline.”
Coates will continue in his executive chair role taking full responsibility to the board for the company’s operations until Gallagher commences his duties.
David Knox, current managing director and CEO, has agreed with the board that he will step down as managing director and CEO and will work with Coates to set up a smooth transition to Gallagher.
Ken Dean will continue his role as senior independent director, while Coates remains in his current role as executive chairman.
Image from Santos.