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LONDON (Alliance News) - Mosman Oil and Gas Ltd said Thursday it has taken "swift action" to minimise its short term expenditure after it terminated its deal to buy the South Taranaki Energy Project from Origin Energy Ltd, including cutting headcount.
Mosman terminated the deal with Origin Energy earlier this month due to the drop in the oil price, saying the acquisition no longer met its investment criteria.
Staff and consultants no longer required have been made redundant or had their contracts terminated, Mosman said Thursday, and it has only retained core staff required to operate its existing permits on a "much reduced" basis, to meet its revised budget and operational requirements.
The New Zealand and Australia focused oil exploration and development company said that once specific tasks have been concluded in 2016 it expects further reductions to staff. Additionally executive directors John Barr and Andrew Carroll have agreed to cap the cost of their services at present.
Mosman said it remains in a "sound financial position" with over AUD5 million in cash, but given the "ongoing uncertainties associated with the current oil price and equity markets", it feels it has a "responsibility to continue to monitor and evaluate the effectiveness of its revised business strategy and plans."
As a result it will evaluate "other suitable opportunities" to enhance shareholder value as appropriate.
Shares in Mosman were up 17% at 0.820 pence Thursday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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