Tough tasks for new Xtract CEO
JAN Nelson has joined Xtract Energy as CEO and has been tasked with coming up with a new strategy for the oil and gas exploration firm. He was the CEO of Pan African Resources.
JAN Nelson has joined Xtract Energy as CEO and has been tasked with coming up with a new strategy for the oil and gas exploration firm.
Mr Nelson was the acclaimed CEO of Pan African Resources, overseeing its growth from a small cashconstrained company with exploration projects around Africa into a cash-generative, 200,000oz a year gold producer.
He resigned in February for personal reasons he has now resolved.
Xtract executive chairman Colin Bird has worked with Mr Nelson before — in the early days at Pan African — and persuaded him to join Xtract, which is traded on London’s Alternative Investment Market.
The struggling company has sold all of its energy exploration assets and investments.
Mr Nelson said yesterday that the company was now looking for precious and base metal prospects in Africa and South America.
He was drawing up a strategy to take to the Xtract board in two months, after which shareholders will be informed of the new direction and investments the company is considering. At the end of its 2012 financial year in December, Xtract had net cash of £220,000.
It subsequently sold some assets, realising more cash. Xtract’s net loss deepened in the year to £7.6m from £4.3m a year earlier.
“Having completed a challenging 2012, we are now in a position to look forward,” Mr Bird said last Friday before Mr Nelson’s appointment was announced on Tuesday. “The board is evaluating many opportunities in the resources sector and is confident that 2013 will be a transitional year for the business.”
Mr Nelson said Xtract would have to raise cash from shareholders once the plan was in place and it was considering strategic partnerships to lessen the capital demands of buying projects and ramping them up. “Xtract has limited cash resources, a small market capitalisation so we can’t go to the moon alone. We will need help.” Xtract has a market capitalisation of about £4m and a share price of about 0.17p.
Gold and platinum reefs are fairly similar and Mr Nelson, a geologist by training, has long experience in the gold sector. Mr Bird has experience in base metals.
“We are looking for opportunities in precious and base metals, but we won’t go for bulk commodities,” Mr Nelson said. “We don’t have any experience in those. There are a lot of options available in SA.”
Mr Nelson would not draw a salary until the company was “financially healthy”. He has been granted 50-million share options. “If Xtract works I stand to make a lot of money. These are the rules,” he said.