Max Petroleum Plc issues corporate update
Max Petroleum Plc, an oil and gas company focused on Kazakhstan, announces an update of its previously announced cost cutting initiative and related accounting charge.
The Company expects that specific measures completed and expected to be completed shortly will result in annualized ongoing cost reductions of approximately US$4 million, a saving in excess of 30% from total general and administrative costs incurred during the fiscal year ended 31 March 2014, excluding share based payments.
In addition, the Company expects to establish an approximately US$3.8 million reserve in its financial statements as of 31 March 2014, for severance and other transitional expenses associated with various cost reduction measures. These include the closure of the Company’s Houston office this year, the reduction in size and cost of the Company’s London office, and a reduction in senior management and administrative personnel in Houston, London and in Kazakhstan.
Among the personnel changes included in the expense reduction actions will be the departure of Michael B. Young, as a Director of the Company on May 31, 2014, and as President and CFO with immediate effect, and his replacement as CFO by Kevin Clark, the Company’s Chief Accounting Officer and Company Secretary. Mr Clark will remain an officer of the Company which is not a Board level position. Executive Co-chairman Robert B. Holland, III, has taken on the role of interim CEO.
“Mike has done an excellent job under challenging circumstances and his departure reflects the Company’s evolution from primarily exploration to development and production, and related prioritization of maximization of cash flow. We are fortunate to have an able successor in Kevin”, said executive co-chairmen Robert B. Holland, III and James A. Jeffs.