SA Mines and Energy Journal : April-May 2010
APRIL/MAY 2010 SA MINES & ENERGY JOURNAL 21 PROFILE From little things big things grow. Nothing could be truer for Beach Energy's chief financial officer, Kathryn Presser. When she joined Beach in 1997 she could have had little idea that the junior explorer, widely considered a penny dreadful in oil and gas circles, would blossom into a force to be reckoned with. Employee numbers grew from five to 90 over 10 years as the company reaped the benefits of significant success in the Cooper Basin, in particular on its western flank. "At the time I joined Beach we didn't know that the company would survive. We had very little money in the bank and there was litigation afoot, " Ms Presser said. She had decided to leave her service industry background to jump into the mining industry when she joined the small exploration company in 1997. She's never looked back. Appointed Beach Energy's accountant and then company secretary in 1998, Ms Presser became its chief financial officer in 2005 and remains among the few significant females in an industry dominated by men. Her move into resources was inspired by the company's managing director and chairman -- Reg Nelson and Bob Kennedy, respectively. "I was impressed by their direction and drive, " she said. "They've pretty much built the company into what it is today. " When she joined the company, Beach Energy had a market capitalisation of about $10 million. It peaked at $1.4 billion just before the global financial crisis in 2008 and has now settled at about $800 million. Ms Presser said the resources industry was cyclical and the company had experienced some turbulent times. "Beach started out at the same time as Santos and was quite successful, but in the 1980s it was defrauded of about $40 million. "There was no regulation in those days, so people were buying and selling assets between themselves, marking them up and selling them to companies. " Beach then moved to Sydney, returning to Adelaide in the late 1990s to further explore blocks in the Cooper Basin that Santos had relinquished. Its PEL 92 discovery secured Beach's future. Ms Presser said Beach grew further when it acquired the Kenmore Bodalla fields in Queensland in 2002, and then expanded into the Gippsland Basin with its Basker Manta Gummy acquisition. Its acquisition of Delhi Petroleum in 2006 resulted in Beach Energy owning a significant slice of South Australia's Cooper Basin. "Beach now owns an average of 26 per cent of the Cooper Basin with Santos, " Ms Presser said. Its interest in the Cooper Basin project operated by Santos includes an aggressive exploration and development program which targets Cooper/Eromanga Basin oil and gas. The company's exploration and production focus is primarily in the Cooper/Eromanga Basin in central Australia, where it holds interests in about 300 exploration and production licences. It operates 18 oil fields in this basin and has five gas discoveries awaiting development. "We produce a couple of million barrels of oil each year from our Cooper-Eromanga tenements and we keep replenishing that by finding a couple of million barrels, " Ms Presser said. The company changed its name from Beach Petroleum to Beach Energy late last year, to reflect the changing mix of its operations. "We now have more gas than oil. We have about 60 per cent gas, 40 per cent oil, so while gas is still a fuel, energy is more our focus going forward, " Ms Presser said. "The name change has also embraced our expansion into overseas opportunities in Egypt and Tanzania, where we see future expansion for the company "Beach produces between eight and 10 million barrels of oil equivalent a year and is continually exploring to replace reserves, so would expect eight million barrels of oil equivalent a year ongoing. " Beach was founded by industry stalwart Reg Sprigg almost 50 years ago, when, as an advisor to Santos, he sought to seize other opportunities in the Cooper Basin. Today, Ms Presser is still one of few women employed at senior levels in the resources sector. "There are a few coming through but there are very few on boards and at CEO and managing director level, " she said. "The majority of my senior staff are male but we have a good mix of extremely capable female geologists and geophysicists at Beach" . She said Beach Energy had been hit hard by the global financial crisis in 2008. "Before the GFC, the oil price was US$140-plus and we saw a significant drop down to US$30, " she said. "It was a bit of an eye- opener and a rollercoaster ride. " However, resources is a cyclical industry and it was not the first time she had seen the oil price tumble. "In my time at Beach, I've seen the oil price go as low as $12 a barrel in 2002, when there was a build-up of world stocks. " She considers the current oil price, about US$80 a barrel, to be sustainable. While Santos is moving further into Queensland, Beach Energy will remain in South Australia but continue to look at opportunities here, interstate and overseas. "South Australia is where a lot of the action is, " Ms Presser said. "We can see a future shortage for gas in SA and that is where our focus is, particularly with our new long-term shale gas potential. " Full steam ahead There were doubts whether Beach Energy would survive when Kathryn Presser joined the company 13 years ago. Today, she is proof that fortune favours the brave, writes Kate Nash. South Australia is where alotofthe action is SA women in resources Kathryn Presser is one of a number of senior women in the resources industry forming the inaugural South Australian women in resources group. To get in touch with the group please contact Antonia Mertiris at SACOME on (08) 8202 9999.