Jason McGlynn has resigned as CFO of Amplify Energy, effective March 17, 2023. He had been the CFO for just over two years, following the promotion of Martin Willsher from CFO to CEO. The company made no mention of its plans for a replacement.
[According to LinkedIn, Mr. McGlynn is now the CFO at Monarch Bioenergy. The company is a PE-backed joint venture between Smithfield Foods and Roeslein Alternative Energy that converts methane emissions from hog manure into natural gas].
Amplify Energy was formed in 2019 from the all-stock merger of Tulsa-based Midstates Petroleum and what was Memorial Production Partners. It has its head office in downtown Houston. Mr. McGlynn joined Midstates in 2013 as its VP of Strategic Planning, Investor Relations and Treasury.
Although the business mainly focuses on mature assets, mainly in Oklahoma and East Texas/North Louisiana, it has been in the news in the past couple of years for a pipeline it operated in offshore California that ruptured in October 2021.
The rupture occurred four miles offshore from Newport Beach and caused 588 barrels of oil to leak. A Coast Guard investigation concluded that two ships, the MSC Danit and COSCO Beijing, had sheltered in San Pedro Bay, ahead of a January 2021 storm. The winds and the waves from the storm caused the ships’ anchors to drag across the seafloor and damage the pipeline.
Last week, the companies that operated the ships, agreed to pay Amplify $96.5 million to settle all claims. During 2022, the company settled claims against it by;
- the Federal Government ($7.1 million fine and reimbursement of $5.8 million of costs)
- State of California ($4.9 million fine)
- a Class action lawsuit ($50 million settlement)
In total, Amplify estimates that it has incurred total costs of $120 million to $140 million, though it has received $87 million (through September 2022) from its insurance carriers. In addition the company has also received $46 million insurance proceeds related to the approved loss of production income.
The company is now in the process of repairing the pipeline. Before it can resume operations, it has to comply with requirements of the corrective action order of The Pipeline and Hazardous Materials Safety Administration (PHMSA), which is part of the US Department of Transportation.