Boardroom feud splits North Sea oil field shareholder

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The Independent Online

A row has broken out between British fund managers and an Australian company with a stake in a North Sea oil field, which is about to go into production.

The feud came out in the open last week when Strathclyde Pension Fund, which holds a 6.25 per cent stake in London-listed Lochard Energy, called for a special meeting to remove from the board the only two executive directors – the chief executive, Haydn Gardner, and the operations manager, Lincoln McCrabb.

The following day, Lochard struck back, removing British non-executive directors James Brooke and Peter Youd from the board with immediate effect.

Mr Brooke is a fund manager at Henderson, the asset management group that is also Lochard's largest shareholder with a 24.3 per cent stake.

The company's prized asset is a 10 per cent interest in Athena, which is based off the Moray Firth. It is expected to start oil production within a couple of months. According to the field's operator, Ithaca Energy – which has a 22.5 per cent interest in Athena – it should hit production levels of 22,000 barrels a day.

The Lochard boardroom bust-up revolves around the company's future. The Australian executives are thought to want to use the revenues from Athena to build a bigger exploration business, while the Brits are believed to be keener to cash in.

Canadian-based Ithaca disclosed last week that it has received more than one takeover bid, sending its shares soaring and prompting hopes that Lochard could be bought, too.

Lochard gave no reason for the dismissals, while Henderson declined to comment.

In another twist, Merchant Securities, which became joint broker to the company on 6 February, resigned last Thursday. Merchant and its clients hold a 7.6 per cent stake in Lochard.