IGas CEO Austin to Step Down after Signing Ineos Deal
LONDON, May 8 (Reuters) – Britain's largest shale gas developer IGas said on Friday its chief executive Andrew Austin would step down after completion of a deal with Swiss chemicals group Ineos.
Chief Financial Officer Stephen Bowler will take on Austin's role as chief executive and the recruitment of a replacement for Bowler was underway, the company said.
Ineos completed a deal to operate a number of shale gas licences held by IGas on Thursday, expanding the Swiss group's presence in the British shale gas industry.
"I have been at IGas for more than 10 years," Austin said in a statement. "The announcement, yesterday, of the completion of the transaction with Ineos means that the company is entering a new phase of execution, well-funded by its partners and with a stable production base."
IGas also said it had started a programme to cut costs including reducing headcount by more than 25 percent and closing its office in Sterling, Scotland.
Total charges for operating costs and general and administrative expenses are expected to be around $39.4 per barrel of oil equivalent to March 31, 2016, excluding reorganisation costs of around 2.6 million pounds ($4 million).
Following the Ineos deal, IGas has benefited from funding of up to $285 million from its partners, including Total E&P UK Ltd, GDF Suez E&P UK Ltd and Ineos.
"We are working with our partners to optimise a five-year integrated development plan for the carried work programme across the North West and East Midlands," IGas said. This includes seismic acquisition, multi-well drilling, hydraulic fracturing and early commercialisation.
Planning is ongoing for a 3D seismic survey in the North Dee area, with work on the site expected to commence in the next few months, the company said.
IGas has disposed of most of its international assets. Its remaining investments outside Britain are in Indonesia, where it is in advanced discussions with a third party, and in India.
As of the end of March, IGas had cash of 19 million pounds and net debt of 90.9 million. The company will release its final results at the end of June. ($1 = 0.6471 pounds)
(Reporting by Nina Chestney and Li-mei Hoang; Editing by Jane Merriman and David Holmes)
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