Santos appoints Sherry Duhe as CFO, stirring Kevin Gallagher succession talk
The appointment by Santos of former Newcrest interim chief executive Sherry Duhe as its new CFO has stirred renewed speculation about the future of chief executive Kevin Gallagher.
The appointment by Santos of a new chief financial officer has stirred speculation the oil and gas company is positioning a potential successor in place should chief executive Kevin Gallagher decide to leave next year.
Santos on Thursday named Sherry Duhe as its new chief financial officer, replacing Anthea McKinnell, who is retiring after more than five years at the company.
Ms Duhe was formerly interim chief executive officer of Newcrest prior to its sale to Newmont, and also has experience in the oil and gas industry via time at ExxonMobil and Shell, history that was praised by the market but stirred talk about the future of Mr Gallagher.
Mr Gallagher is due a sizeable loyalty bonus next year and market chatter has intensified that he may leave afterwards, though talk about the future of the chief executive has rumbled on for some time.
Saul Kavonic, energy analyst at MST Marquee, said the appointment was much needed as the bench of potential replacements has emptied in recent months.
“A lot of the best executives at Santos have left over the last couple of years. Many in the industry wonder if there are any board members or senior executives left at Santos who are willing to provide real constructive challenge to the CEO,” Mr Kavonic said.
Former Santos executive Brett Woods left last year to join fellow SA-based company Beach Energy, months after Jane Norman left to join Cooper Energy.
Citi also raised the prospect of Ms Duhe as a potential replacement for Mr Gallagher, insisting the market is impressed by her track record and experience.
“Sherry Duhe is a highly competent, experienced manager with C-Suite roles in ASX blue chips and therefore adds genuine bench strength to Santos,” Citi said in a note.
“In the instance CEO Gallagher were to retire, we could see Duhe stepping up into the CEO role seamlessly. This appointment should therefore assuage some fears in the market on CEO succession. At Woodside, we found Duhe a highly commercial CFO. She is held in high regard by equity investors.”
Mr Gallagher praised Ms McKinnell but gave no clues about his own future.
“I want to reflect on the impact she has had on our business, providing disciplined financial management and guiding our financial strategy through a challenging and dynamic period. She has championed transparency and accountability, ensuring compliance and integrity in the finance function, and driving this across the business,” Mr Gallagher wrote in an internal memo.
Santos was hit by environmental activism, which forced a small delay to the Barossa project, but Mr Gallagher has been a key player in the company’s forceful retort. However, the chief executive has been under mounting pressure from some shareholders as the company’s share price languishes behind rivals such as Woodside.
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