Directors' Report

Last Updated on Thursday, 08 October 2009 14:47 Written by Administrator Wednesday, 23 September 2009 15:55

The Directors present their report together with the financial report of Pan Pacific Petroleum NL (‘the Company’) and the Consolidated Entity, being the Company and its subsidiaries, for the year ended 30 June 2009 and the auditor’s report thereon.

Principal Activities

The Consolidated Entity is predominantly involved in petroleum exploration and production.

There were no significant changes in the nature of the activities of the Consolidated Entity during the year.

Following the establishment of post-tax profits and cash flows from the Tui oil field Directors’ will aim to focus the Company on expanding its activities to add further value for shareholders.

Results of Operations

The consolidated operating profit after tax for the year amounted to $40,752,000 (2008: $52,441,000). Refer to pages 6 to 11 for further detail of review of operations.

Names and qualifications of Directors in office during the financial year are set out below:

N Tomkinson, LL.B (Hons.), the Chairman, (Non-Executive Director) has extensive experience over the last 25 years in the administration of and investment in exploration and mining companies in both oil and gas and in hard rock. Mr Tomkinson’s other public company directorships are Hampton Hill Mining NL (since January 1997), Traka Resources Limited (since September 2003) and Red Hill Iron Limited (since April 2008). He was appointed to the Board on 23 June 23 2006.

R A Radford CA (NZ), (Non-Executive Director) has been a Director since 1979. His earlier career included senior financial roles in steel making, tin smelting and mining companies. He has in excess of 20 years' experience in managing petroleum and mining companies. His other public company directorships are New Zealand Oil & Gas Limited (since June 1981) and Pike River Coal Ltd (since January 1992). Mr Radford resigned as Chief Executive of the Company on 16 December 2008 and as Chairman on 26 December 2008.

A W Tattersfield, M.Com., is a (Non-Executive Director) and has over 30 years' experience operating retail and construction companies, plus the financing and negotiation of exploration joint venture deals. He was appointed to the Board on 22 February 2005. Mr Tattersfield is also a member of the Audit Committee. M W Daniel, B.Com. Ec, (Non-Executive Director) was appointed to the Board on 29 December 2008. Mr Daniel who is a former stockbroker and merchant banker is Chairman of New Zealand listed Northland Port Corporation (NZ) Ltd, Northport Ltd, NPC Corporate Services Ltd, and NorthPort Coolstores (1989) Ltd each NZ companies. Mr Daniel is also Chairman of the Audit Committee.

J N Pitt, B.Sc., MAusIMM, MAIG, (Non-Executive Director) is a geologist with extensive exploration experience who has for more than 30 years been a director of exploration and mining companies in Australia. He has had a successful career providing seed capital for and managing listed exploration and mining companies including Aztec Exploration Limited, Golden Grove Mining NL, Forrestania Gold NL and Dalrymple Resources NL. Mr Pitt is currently a Non-Executive Director of Hampton Hill Mining NL (since January 1997), Traka Resources Limited (since September 2003), Red Hill Iron Limited (since June 2005) and Red Metal Limited (since July 2003). He was appointed to the Board on 29 December 2008. Mr Pitt is also a member of the Audit Committee.

Chief Executive Officer (‘CEO’)
The Company’s CEO is Tom Prudence, MSc Petroleum Geology; BSc Hons Geological Geophysics; FGS. Prior to joining the Company, Mr Prudence worked for four years with RISC Pty Ltd, a leading international oil and gas exploration and production consultancy in Perth, WA, where he held the position of Principal Adviser/Chief Geoscientist. In this capacity he advised on numerous diverse oil and gas projects throughout South East Asia, the Middle East, Africa, Australia and New Zealand, including valuations of exploration and producing assets, reserves auditing, and strategy and new business development. His experience prior to that covered a range of senior international technical and commercial positions with the Shell Group of Companies over a 25-years period including working in the UK, the Netherlands, Nigeria, USA, Australia and Brunei where he was Exploration and Technical Services Manager. Mr Prudence joined the company in September 2008 as General Manager Exploration and Production. On 16 December 2008 he was appointed to the position of CEO.

The number of Directors’ meetings and number of meetings attended by each of the Directors of the Company during the financial year were:

Notes:

(1)

On 17 December 2008 following the announcement by New Zealand Oil and Gas Limited (‘NZOG’) of its intent to seek a strategic stake in the Company, Mr R A Radford and the Company formalised a process (‘Protocol’) to manage any potential conflicts relating to Mr Radford’s position as Chairman of NZOG and as a Director of the Company. A key term of the Protocol was that Mr Radford would not attend meetings where topics fell under the ambit of the Protocol.

 

 

 

A – Number of meetings attended. B – Number of meetings held during the time the Director held office during the year.

During the financial year the Company established an Audit Committee. The Audit Committee’s first meeting was held on 7 July 2009. Given the size and nature of the Consolidated Entity the Directors are of the opinion that no other sub-committees are necessary.