Departure of Simon Lockett from Premier Oil drives shares up 8%

After suffering numerous production problems and a share price that has fallen over 30% in the last year, Premier Oil today announced the departure of CEO, Simon Lockett, after 9 years as head of the company. He said “We can be proud of what we as a team have achieved but, after 9 years, I believe now is an appropriate time for a change in leadership as the business moves into its next phase. I am also looking forward to pursuing new business opportunities but in the meantime will continue to devote all my energies to ensuring the continued success of Premier.”

The shares are up over 8% to 290p. PMO’s partner in the Falkland Islands, Rockhopper Exploration, is down nearly 4% to 125p on fears that the new CEO will perhaps abandon the North Falklands Sea Lion discovery before the Final Investment Decision in the middle of this year. Several institutional investors in Premier including Schroeder’s have argued that the Falklands is too risky and the Sea Lion development is too costly despite over 350 million barrels of reserves.

Though Premier oil has been swept up in the negative sentiment surrounding and small and mid cap oil and gas companies, a series of operational set backs have put the company on the back foot. Perhaps the institutions finally lost patience with Lockett?

Contrarian Investor UK

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