Oil and gas service provider Firetail calls in administrators, leaving 20 staff out of work

An oil and gas services provider ranked among SA’s fastest-growing companies last year has collapsed, leaving close to 20 staff out of work.

One of the state’s fastest-growing companies has run out of gas, calling in administrators and leaving close to 20 staff out of work.

Cavan-based Firetail provided services to the oil and gas sector across the country, including flow testing and other exploration support, installation of underground electronics and sales and rentals of equipment for major projects.

Administrator Stephen James from BCR Advisory said the company had ceased trading, with most of its 20 or so staff having their employment terminated.

“The business has effectively ceased trading and we’re doing a managed wind-down of the operations now,” he said.

“They had a couple of contracts in progress when I was appointed so I’m just making sure they get finished off – we’ve had to terminate most of the employees and we’re just keeping on a skeleton crew to help us go through a managed wind-down process.”

Founded by Mike Wayne in 2016, Firetail was ranked the sixth fastest growing company in the state as part of last year’s BDO Fast Movers program, with average annual revenue growth of 165 per cent over the previous three years.

Mr James said it was too early to provide an estimate of debts owed to creditors but said the company had worked on projects for “some of the bigger oil and gas companies in Australia”.

He said while COVID-19 played a small role in the company’s demise, given the limitations on interstate movement of staff and equipment, it was not the primary reason for its failure.

“It’s the type of business that you need to have a lot of working capital in,” he said.

“When they win a project there’s a lot of preparation time involved. They’re deploying resources to interstate, preparing their designs and equipment requirements for a project – there’s a lot of money spent in advance of actually starting the project and earning revenue.

“In the last couple of months they had some expectations of revenue coming in from different sources that didn’t eventuate and that put a real squeeze on their working capital.

“That caused them to have pressure mounting from creditors because they weren’t able to pay.”

The first meeting of creditors will be held on April 14.