Struggling after emerging from its 2016 bankruptcy reorganization, Oklahoma City’s SandRidge Energy on Tuesday announced the naming of a new company president. At the same time, it suggested further employee reductions are coming along with a suspension of drilling activities and its remaining 2020 capital expenditures budget.
Carl F. Giesler, Jr., formerly CEO of Jones Energy in Texas was named to be President and Chief Executive Officer, replacing John Suter who will remain as the company’s Chief Operating Officer.
Jonathan Frates, chairman of the board pointed to Giesler’s recent experience in handling the more than $200 million merger of Jones Energy with Revolution Resources. Jones is now a wholly-owned subsidiary of private equity backed Revolution.
“Given the ongoing headwinds in the oil and gas environment, we’re committed to protecting our strong balance sheet and liquidity, and to maximizing the value of the enterprise for our shareholders,” explained Frates in making the announcement of leadership change.
“Key to both of those objectives is the further right-sizing of our cost structure, rationalizing our capital program and improving our capital efficiency. We believe that Carl, with his proven cost and operational turnaround experience at public oil and gas companies, is the right person to lead these initiatives.”
In making the announcement, company leaders also said they had adopted the implementation of further moves to maximize free cash flow and reduce the company’s debt level. Shares of SandRidge added 10 cents in value in Monday’s trading as they ended the day at 87 cents per share.
“Planned further actions, including salary and additional personnel reductions, will deepen the savings detailed on the Company’s recent February earnings call,” stated the announcement.
SandRidge also plans even more reductions in its 2020 capital expenditures and will “defer any material drilling and completion activity until commodity prices and the corresponding economics for new wells improve.”
The board also determined that it will continue to consider the sale of any assets that don’t create a cash flow.
“Given the coronavirus pandemic and the associated market volatility and uncertain oil and gas market outlook, SandRidge feels it is appropriate to withdraw its 2020 guidance,” stated the announcement.
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Source: SandRidge Energy