Penn West Petroleum Ltd. said Wednesday that it is changing CEOs, cutting its staff, reducing its dividend and conducting a review of its strategic alternatives. Shares of the Canadian oil and gas company fell on the news.
The company said that Murray Nunns will resign as president, CEO and a board member July 1 after eight years at Penn West. David Roberts, former executive vice president and chief operating officer of Marathon Oil Corp., will take over as president and CEO on June 19.
Penn West said that Roberts' more than 30 years of experience in the oil and gas industry make him a welcome addition to the company. Roberts is also expected to be appointed to the board in place of Nunns.
The company said that its focus, under a CEO and new board, will focus on operating the business in a more efficient manner and lowering expenses. As part of that plan, it will be looking at staffing levels and expects to cut 10 percent of its staff over the next few weeks. A representative for the company could not be reached immediately to give the current headcount at Penn West.
According to FactSet, the Calgary, Alberta-based company employs 2,130 workers.
Penn West announced earlier in May that it was replacing the chairman of its board.
The company is also forming a special committee to explore strategic alternatives to increase shareholder value, including financing alternatives, asset sales, joint ventures or other business combinations. The company expects the process will be complete by year-end.
"Penn West has many high quality assets but the company has yet to unlock their complete value," Rick George, chairman of the board, said in a statement.
The company also said that beginning in its third quarter, it will cut its dividend nearly in half to 14 cents from 27 cents per share. Penn West said the move will increase its financial flexibility as it tries to improve its performance.
Penn West reported earlier in the month that it swung to a first-quarter loss on weaker sales and royalties.
Shares of the company fell slipped 12 cents to $10.41 in midday trading. Its stock is at the lower end of its 52-week trading range of $8.59 to $16.70.