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UPDATE 2-Genel's chairman and co-founder Hayward to step down in June
April 24, 2017 / 8:04 AM / 4 months ago

UPDATE 2-Genel's chairman and co-founder Hayward to step down in June

* Former BP CEO to be replaced by Shell veteran Stephen Whyte

* Genel hit by two reserve downgrades in Kurdistan (Adds further details, share price reaction)

By Ron Bousso and Rahul B

LONDON, April 24 (Reuters) - Genel Energy's chairman and co-founder Tony Hayward is to leave in June and will be replaced by another industry veteran, Stephen Whyte, as the Kurdistan-focused oil company seeks to restore its fortunes after bruising reserve downgrades.

Hayward, the 59 year-old former chief executive of BP who resigned in 2010 following the Gulf of Mexico Deepwater Horizon disaster, bought Genel with British financier Nat Rothschild in 2011 with the aim of developing prospects in Iraqi Kurdistan and Africa at a time when oil prices stood above $100 per barrel.

But Genel's London-listed shares are now near an all-time low, with the company's market capitalisation of 215 million pounds ($275 million) less than a 10th of its peak valuation in 2014 following the collapse in oil prices the same year, failed exploration campaigns in Africa, violence in Iraq and after twice slashing reserve estimates at its flagship Taq Taq field in Kurdistan.

Hayward remains Genel's 12th-largest shareholder with a 0.5 percent stake, now worth $1.86 million according to Thomson Reuters data.

His widely expected departure as chairman will remove some uncertainty for the embattled company that is now hoping to develop its gas business in Turkey, said BMO Capital Markets analyst David Round.

Genel's shares were up 4.8 percent at 81.25 pence at 1200 GMT, when the Stoxx 600 Europe oil and gas exploration and production sector index was up 2 percent.

"Genel have operational issues particularly around Taq Taq that are important to resolve," Round said.

Hayward, who acted as Genel's chief executive until 2015 and is also the chairman of commodity trading and mining group Glencore, will not receive any severance package beyond his salary, a company spokesman said. He will retire from the board at the conclusion of the annual general meeting on June 6.

Analysts said Whyte is relatively unknown to the market, despite having over 30 years of experience at Royal Dutch Shell , BG Group and Portugal's Galp Energia.

Currently also chairman of London-listed Sound Energy, which holds exploration permits in Morocco and Italy, Whyte could help Genel accelerate its plans to expand beyond Kurdistan and Turkey, a source at Genel said.

He will join the board as non-executive director and chairman designate with immediate effect, the company said. ($1 = 0.7819 pounds) (Reporting by Rahul B in Bengaluru; editing by Jason Neely, Greg Mahlich)

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