Oil & Gas resignation 'not linked' to Pike River

New Zealand Oil & Gas chief executive David Salisbury File photo

The chief executive of New Zealand Oil & Gas, David Salisbury, has announced his resignation for "personal reasons", but the company says there is no link between the unexpected departure and the imminent start of hearings of the Pike River coal mine commission of inquiry.

NZOG holds a 29 per cent shareholding in Pike River Coal, which has been in receivership since late last year, following explosions at the mine that killed 29 underground workers in November.

Spokesman Chris Roberts told BusinessDesk "there is no link whatsoever with the Pike inquiry, which we are fully cooperating with, to the extent that we have anything of relevance to provide."

Roberts also said there had "not been any breakdown in the relationship between the board and the ceo."

Salisbury would not be commenting further on his reasons for leaving, just weeks after announcing a new initiative to explore for oil off the coast of Tunisia.

Salisbury joined NZOG in April 2007 and will leave the company on December 29.

NZOG was a key player in the development of the Pike River mine, which suffered substantial cost over-runs and delays to production caused by the complex geology of the mine site.

NZOG shares were steady at 84 cents as NZX trading began this morning.
In a statement to the NZX, chairman Tony Radford said the NZOG board was "disappointed to be losing someone of David's calibre."

He had made a "tremendous contribution during a period of growth for our business that has included many significant challenges," Radford said.

"David has brought great enthusiasm, rigour, discipline and insight to our business strategy. I know he is keen to conclude a number of important initiatives over the coming months."

Recruitment of a replacement ceo will commence shortly.

NZOG's exposure to Pike River totals $142 million, comprising $77 million in equity and $65 million in loans.

The company "expects to recover a significant portion of its investment" when the mine project is sold.

Receivers are currently conducting a sale process, with family members of the dead miners insisting any new owner should be held to an obligation to retrieve the remains from the mine.

The receivers, PricewaterhouseCoopers, have said they do not have funding for a full recovery operation, despite helping fund mine re-entry.