European Gas Limited Appoints New CEO And Looks To The Future
oilbarrel.com
Investors in European Gas Limited will be hoping to see some long overdue progress on the company’s slate of coal bed methane projects now that a key vacancy has been filled. The ASX-listed company, which has projects in France and Italy, has appointed industry veteran Peter Cockroft as chief executive and managing director, allowing acting MD Julien Moulin to step down and take up his position as chairman.
Cockcroft is no stranger to the unconventional gas business. He is currently non-executive chairman of ASX-listed Blue Energy Limited, which is engaged in coal seam gas exploration in Queensland, the heart of Australia’s booming gas industry. His CV includes senior management stints at Shell, BHP and Premier Oil and he has also worked with national oil companies in Indonesia and South Korea, and acted as special adviser to the Prime Minister of Timor-Leste.
Moulin, an investment manager who has received no salary for his time as acting MD, welcomed Cockcroft’s appointment to a position that has been empty since former MD Tony McClure stepped down in October 2009. These have been difficult times for the cash-strapped company, which is seeking third party funding options to repay or refinance the impending maturity on December 31 its €36 million of outstanding convertible notes held by Transcor, its joint venture partner in Belgium. After much discussion, Transcor indicated at the end of last year that it would not extend the maturity of the notes, provide further finance or convert the notes into shares. This leaves European Gas seeking some alternative to meet its year-end obligations and Moulin, as chairman, will continue to oversee the restructuring of the balance sheet.
For now, the company is staying afloat with the assistance of an A$2.5 million interest free loan from a high net worth private investor. This bought the ASX company, which at the end of March 2010 had available funds of €1.41 million, some breathing space, ensuring its working capital requirements can be met over the short term. (It also bought it a little heat from the ASX, which questioned why an announcement about the loan wasn’t made earlier; European Gas Limited, in its defence, said the A$2.5 million loan couldn’t be judged to be “material” in the context of its wider financial problems.)
The funding issue has long held back European Gas from pressing home its advantage in Europe’s fledgling CBM business. The company has rights to all the CBM prospective basins in France, quite a coup for such a small cap company and, despite its funding constraints, has made some headway with its vast Lorraine project in the east of the country, where the resource base could run into the trillions of cubic feet. If the new CEO can help solve the funding issue and bring in some joint venture partners to get some real momentum behind this promising slate of projects, then investors will start to feel much more comfortable about the company’s ability to deliver value.
Welcoming Cockcroft, chairman Julien Moulin was keen to look to the future. “We are very confident that [Peter’s] substantial knowledge of the industry, expertise and reputation will assist in driving the Company through its next growth phase,” said Moulin, who is the co-founder of Maoming Investments. “The combination of our exploration portfolio (one of the largest in Continental Western Europe), the potential for major unconventional gas resources, and the addition of Peter and his experience, gives the current Board considerable confidence in the outlook for the company’s future and the growth and exploitation of our assets”. |
