TRAP Oil said it has cut directors pay by 20% this year and "trimmed" staff levels after losing £10.3 million before tax in 2013 and highlighted the challenges oil and gas firms can face in the North Sea.
The company drilled fewer wells than directors had hoped for in 2013 and wrote down the value of some assets amid what it described as various partner drag issues. Trap Oil drilled two dry wells in 2013. In July 2012 the company said it planned to drill five prospects in 2013.
The company, which bought Banchory-based Reach Oil & Gas for £30m in 2011, follows a strategy which involves farming out stakes in exploration acreage to partners in exchange for them bearing some of the related costs to limit its exposure.
The approach relies on partners retaining their enthusiasm for assets and coming up with the required funds.
In the year to December the company suffered a £9.4m loss on a deal which involved selling its interests in eight North Sea blocks to Caithness Oil for £4.8m shares in IGas.
The company said the deal reflected Caithness' anticipated exit from the North Sea region.
Trap Oil said it returned some promising assets to the authorities as it was unable to progress them with parners.
Chief executive Mark Groves Gidney said: "In our view, it will take some time yet, and most likely require new government initiatives post Sir Ian Wood's recently published review of UK offshore oil and gas recovery and its regulation, to stimulate increased risk capital investment into the North Sea region."
The company said: "To recognise increased costs in the running of the business, in 2014, management have taken a 20% pay cut and staff levels have been trimmed, as has administrative expenditure."
The company did not detail the pay cuts. Mr Groves Gidney was paid £226,000 salary in 2012.
Following the departure of two people, Trap Oil has around 15 employees.
Chairman Kevin Watts will stand down on 1 May and be replaced by financier Simon Bragg.
Non-executive director Miles Newman will leave the company following the coming general meeting. Technical director Martin David will stand down from the board but continue to head the department.
Trap Oil has a stake in the producing Athena field.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article