Oil Search whistleblower raised concern over chairman Rick Lee
A whistleblower complaint that led to the departure of Oil Search’s CEO also raised concern over his close relationship with chairman Rick Lee.
A whistleblower complaint over bullying that triggered the exit of Oil Search chief executive Keiran Wulff also raised concerns that the now deposed boss was too close to the company’s chairman, Rick Lee, potentially jeopardising the chances of a fair hearing.
Mr Wulff abruptly resigned from the Papua New Guinea LNG producer on July 19 following claims of bullying including a whistleblower complaint in June, sparking an investigation which found evidence of inappropriate behaviour.
Sources have told The Australian the whistleblower expressed fears that Mr Wulff’s tight relationship with Mr Lee might prejudice any probe into the complaint and accused the chairman of acting as a de facto executive.
Mr Wulff spoke to his chairman four to five times a day on a range of issues, which put a number of his executives offside and led to them feeling disenfranchised, the sources said.
The revelation is significant given speculation Mr Wulff’s tunnel vision for developing the company’s $US3bn Alaskan oil project may not have been shared by all of his management team. It also suggests the whistleblower may be an executive with direct knowledge of the day-to-day relationship between the former CEO and its current chairman.
While Oil Search can point to the whistleblower complaint being fully investigated and ultimately contributing to the departure of Mr Wulff, the latest revelation signals there may still be underlying worries over the chairman’s conduct. Oil Search declined to comment.
An investigation was conducted over a terse meeting between Mr Wulff and Oil Search’s finance chief designate, Ayten Saridas, which is understood to have cleared the former CEO. Ms Saridas left the company on December 1 after just three months in the role.
Mr Lee put several Oil Search investors offside after telling analysts the company had not received any takeover approaches and then being forced to admit the next day it had received a $23bn buyout bid from Santos.
The chairman has been leading Oil Search’s response to the mega-merger offer. After rebuffing the first bid, the board agreed a week ago to unanimously recommend an improved offer which gives it 38.5 per cent of the combined company, with Santos gaining the 61.5 per cent balance.
Some company insiders are unimpressed that the company may be in danger of being sold cheaply. There is also recognition that Santos has pounced at one of Oil Search’s weakest moments given uncertainty over Alaska, a PNG expansion still years away and the exit of its CEO.
Oil Search said late on Friday that it had now agreed on confidentiality with Santos and started a mutual, exclusive due diligence process which should take four weeks.
Peter Fredricson was named interim chief executive after replacing Mr Wulff and immediately declared that Oil Search needed a higher bid than the original offer made by Santos.
Papua New Guinea‘s Prime Minister cautioned on Thursday that the planned merger with Oil Search must pass a national interest test and the country did not want to be regarded as a branch office for a foreign company.
Credit Suisse has suggested the PNG government could use their merger approval as leverage to grab more value for the country, noting they have knocked back proposed deals in other sectors.
PNG said it was open to a beefed-up company fast-tracking long-stalled LNG expansion options for the country.
Santos could sell a stake in the PNG LNG project to ExxonMobil or Total as a defence mechanism to ensure neither company threatens its $21bn Oil Search merger with a rival bid, analysts said.
The merger deal, recommended by Oil Search, would hand the company 42.5 per cent of PNG LNG, which would give it more clout than operator Exxon at 33.2 per cent.
