BW Communities

Cairn CEO Steps Into Chairman Role In Shake-Up

BW Online Bureau Nov 08, 2014

<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[UK-based oil explorer Cairn Energy, battling challenges to two major projects in Greenland and India, announced its chief executive would step up into the chairman role amid a sweeping board shake-up. The company said on Thursday that Bill Gammell, who founded the company, would move into the chairman role, leaving the CEO post to be filled by Simon Thomson, the current legal and commercial director. Corporate governance code frowns upon the practice of chief executives stepping into chairman jobs, which can make it hard for new CEOs to challenge their predecessors' decisions. Cairn said it had consulted major shareholders and said they were comfortable with the decision. Cairn is currently battling to complete two major undertakings. Its exploration plan in Greenland, aimed at opening up a new oil province with potentially billions of barrels, has been interrupted repeatedly by environmental campaigners. In addition Cairn's planned sale of most of its stake in its Indian subsidiary, Cairn India, to Vedanta Resources <VED> has also been delayed due to challenges from the government, which wants to extract higher taxes in return for approving the sale. A spokesman said Gammell had been mulling an end to his long tenure for some time and that the move was unrelated to any other issues. Cairn's shares were down 1.4 percent by 0800 GMT, underperforming against a 0.6 percent slide in the STOXX Europe 600 Oil and Gas index. Some investors had expected that Gammell would be succeeded by Mike Watts, Cairn's exploration director, who will retain his position. Malcolm Thoms, 55, chief operating officer, and Philip Tracy, 61 group engineering and operations director, will stand down from the board, as will outgoing chairman Norman Murray. Finance director Jann Brown will become managing director. Gammell, a childhood friend of former U.S. President George W. Bush who also went to school with former British Prime Minister, Tony Blair, built the multi-billion dollar exploration business from scratch. A former rugby international player for Scotland, he has become one of the most respected figures in the British oil industry. (Reuters)