Tracy Jackson has resigned as CFO of Sugar Land-based CVR Energy, with immediate effect. She is replaced, on an interim basis, by Dane Neumann, VP – Finance and Treasurer.
No reason was given for Ms. Jackson’s departure and no severance details were disclosed. [UPDATE 08-25-21 – The company filed an update. Ms. Jackson will get $789,000 through August 2024.]. However, there is clearly some turmoil at the company, as Matthew Bley also resigned last month as the Chief Accounting Officer. Ms. Jackson joined CVR in 2018 from San Antonio-based Andeavor. Mr Bley joined the same day and had worked with Ms. Jackson at Andeavor.
CVR operates two refineries in Kansas and Oklahoma as well as related pipelines and infrastructure. Activist investor, Carl Icahn, owns 72% of CVR, which has a market capitalization of $1.3 billion.
Until recently CVR also owned a 15% stake in Delek, a convenience store fuel retailer. Mr. Icahn lost a recent proxy battle with Delek when his three proposed board nominees failed to get elected. As a result, in June, CVR issued a special dividend of $492 million comprising $241 million in cash and the remainder in shares of Delek.
Mr. Neumann joined CVR in June 2018 and also worked for Andeavor and its affiliates from March 2011 until June 2018.
Jeffrey Conaway has been appointed Chief Accounting Officer, replacing Mr. Bley. He joined the company in August 2020, having previously been with Patterson-UTI Energy
SEC filing – CVR refining – CFO steps down
Huntsman Corporation, based in The Woodlands, has appointed Phil Lister as its new CFO. He replaces Sean Douglas, who resigned in April to take a senior leadership position with The Church of Jesus Christ of Latter-day Saints.
Mr. Lister is currently the VP of Corporate Development, a role he has been in since May 2019. He has spent his entire career with the company or its predecessors. He started out his career with ICI in the UK, shortly before it was acquired by Huntsman in 1999.
No compensation was disclosed for Mr. Lister, other than he will receive an initial equity award of $610,000 that will vest over three years. By comparison, Mr. Douglas had a base salary of $650,000.
SEC filing – Huntsman appoints new CFO
The stock of Stabilis Solutions will once again be traded on the Nasdaq, effective April 29. It was publicly-traded for a few months in 2019.
Stabilis is a small-scale producer and distributor of Liquified Natural Gas. The company builds and operates cryogenic natural gas processing facilities, called “liquefiers”, which convert natural gas into LNG through a multiple stage cooling process. It sells the LNG to energy and industrial companies.
Stabilis Energy, as it was known then, went public in July 2019 when it completed a reverse takeover of AETI, based in Bellaire. Stabilis is owned by Casey Crenshaw, who had also been a director and shareholder of AETI since 2012. It has its head office in west Houston.
Immediately after the transaction was completed, the company received a delisting notice from Nasdaq because it neither had a minimum of 1 million publicly-held shares nor a minimum market value of $15 million for the publicly-held shares. That was due to Crenshaw owning 77% of the combined company.
As a result, the shares were suspended in October 2019 and ultimately delisted later that year. The market cap for the company (traded over-the-counter) is now around $120 million. As a result, the public float exceeds $15 million. The 25 current stockholders will be happy with this.
You can see the full list of Houston-area public companies on my website here
SEC filing – Stabilis relisting
Ben Atkins has submitted his resignation as the CFO of NextDecade. He has been replaced by Brent Wahl, who joined the company in June 2019 and is currently the Senior VP of Finance.
The company is based in downtown Houston and is trying to build a LNG terminal in Brownsville, Texas. NextDecade went public in July 2017 via a reverse takeover of a blank check company.
The company has received permits from the Federal Government for the terminal but won’t start construction until it has signed long-term contracts with customers. Currently, the company has enough cash to last it through the end of this year.
So far, the company has only a 20-year contract with Shell, covering about 20% of the proposed output. Late last year, Engie, a French company, delayed making a decision on a proposed contract with NextDecade. The French government, which owns 24% of Engie, wants the Engie to source cleaner energy. The company suffered another blow last week when Ireland dropped a plan to build a terminal in Cork that would have imported LNG from the proposed Brownsville facility.
Mr. Atkins had been the CFO since November 2015. Prior to that he worked for GE Capital and McKinsey.
Before joining NextDecade, Mr. Wahl was the Head of Midstream Investment Banking for North America at Macquarie Group. He spent nine years there, working on raising finance for LNG facilities in North America.
Mr. Atkins will receive a base salary of $350,000.
SEC filing – NextDecade CFO
Meg Gentle has stepped down as CEO of Tellurian. She has been replaced by Octavio Simões. He joined the company in 2019 and was most recently its VP of Marketing and Business Development. Prior to that, he was the CEO of Sempra LNG & Midstream.
The current chairman of Tellurian is Charif Souki. He was a co-founder of Cheniere and its CEO from 2002 until he was forced out in 2015. He formed Tellurian in 2016 with a plan to build a LNG terminal in Louisiana called the Driftwood Project.
Ms. Gentle has been the CEO since August 2016 and, prior to that, spent 12 years at Cheniere. No reason was given for her departure but it appears to be related to the stalled progress on the Driftwood Project. For the 2019 financial year, the Board did not give bonuses to Ms. Gentle and most other senior executives because the company failed to achieve ‘Final investment decision’ (FID) on the project. In other words, they didn’t secure enough firm long-term contracts with customers to allow construction to start.
Petronet pulls out
In early November, Petronet of India decided not to invest in the project. They had signed a Memorandum of Understanding with Tellurian back in September 2019 to take a $2.5 billion stake in the company. The MOU was announced during the visit to Houston by Narendra Modi, Indian Prime Minister.
The stock price of Tellurian was around $8 until doubts about the Petronet deal began to surface in February. It is currently $1.49.
Ms. Gentle will continue to receive her annual salary of $721,000 through December 2021. She was also get a future lump sum of $721,000. She also retains 3.25 million shares of restricted stock, other options and awards that will vest upon FID. These could be worth up to $21 million.
Mr Simões will receive a base salary of $725,000.
SEC filing – Tellurian CEO
James Camp, 66, of New Braunfels has been sentenced to four years in prison after admitting to stealing nearly $10 million from his former employer, Lubrizol. The fraud occurred over an 19-year period.
Lubrizol was a public company until its takeover by Berkshire Hathaway in 2011 for $9 billion.
Camp began working for Lubrizol in Deer Park in 1976. Part of his job involved managing the testing of samples of the wastewater treatment unit at the facility. Camp was also responsible for managing various laboratory tests requested by Lubrizol production or waste management personnel. In addition, he was responsible for selecting the labs and approving the payments to those labs.
Beginning in April 1998, Camp set up two sham companies as vendors in the Lubrizol ERP system. He then fabricated invoices and set up the electronic payment requests, which were sent to the corporate office in Ohio.
The scheme continued until Camp retired from the company in November 2017. In total, the company paid almost $9.3 million to the sham companies. In addition, Camp used a company credit card to make $385,000 in purchases from one of the sham companies.
Camp was arrested in September 2019 and pleaded guilty in June. His sentence will be followed by three years of supervised release. Camp was also ordered to pay restitution in the amount of $11,256,712.54.
Cheniere LNG – Sabine Pass – Roy Luck
Cheniere Energy has appointed Zach Davis as its new CFO. He replaces Michael Wortley, who steps down from the role, effective immediately. Mr Wortley will remain employed through the end of the month.
Cheniere is based in downtown Houston and was the pioneer in developing Liquified Natural Gas (LNG) for export. It currently has a market capitalization of $13 billion.
Mr Davis joined the company in 2016 as the VP of Finance and Planning and was promoted to Senior VP, Finance in February 2020. Prior to joining Cheniere, he held energy investment banking and finance roles at Credit Suisse, Marathon Capital and HSH Nordbank.
Mr Davis will receive a salary of $500,000. He also received a restricted stock grant for the same amount that vests over three years.
Mr Wortley, 43, has been CFO since January 2014 when the market cap of the company was about $10 billion. He joined Cheniere in 2005. He will receive:
- a cash severance bonus of $2,857,000 when he leaves.
- a cash payment of $1,946,000, payable in February 2021.
- one year’s salary ($715,000) to be paid over the next year.
- $75,000 transitional allowance for health insurance or other associated expenses.
- Vesting of restricted stock and performance stock awards that were scheduled to vest in 2021 and 2022. At the current stock price, I think these are worth around $5.5 million.
SEC filing – Cheniere CFO change
Refugio State Park – USFWS Pacific Southwest Region
Plains All American has agreed to pay over $60 million in penalties and clean-up costs after a May 2015 pipeline spill west of Santa Barbara, California. The spill, which was caused by corrosion, resulted in the release of 2,934 barrels of crude oil onto Refugio State Beach and the Pacific Ocean.
Plains (market cap $4.9 billion) has its head office in downtown Houston. It has 18,000 miles of crude oil and NGL pipelines as well as 9,100 rail cars and 1,600 trucks and trailers.
The 24-inch pipeline runs from Exxon Mobil’s storage tanks in Las Flores westward to Plains’ Gaviota pumping station. Plains failed to detect the extent of the corrosion. The company was also faulted for waiting 80 minutes after the initial rupture before notifying the California authorities. In addition, Plains did not identify or account for a nearby storm drain in its emergency response plan. The crude oil that escaped flowed through the storm drain directly onto the beach.
Plains will pay
- $24 million in penalties
- $22.3 million in natural resource damages
- $10 million for reimbursed natural resource damage assessment costs
- $4.3 million for reimbursed Coast Guard clean-up costs
Tellurian has appointed Kian Granmayeh as its new CFO. He replaces Antoine Lafargue, who will join the marketing group as the Senior VP of LNG Marketing. Mr Lafargue has been CFO of Tellurian or its predecessor company since June 2015.
Mr Granmayeh began at Tellurian as a consultant to the CFO in January 2019 and was appointed as Director of Special Projects in July 2019 and Director of Investor Relations as month later. Prior to joining Tellurian, he worked at Apache.
Mr Granmayeh will receive a base salary of $380,000.
It’s been a rough few weeks for the company, which is based in downtown Houston. In late February it announced that its anticipated completion of a partnership deal with India’s Petronet was delayed by two months. That deal is tied to the proposed Driftwood LNG project in Louisiana. As a result, its share price dropped by 10% on the day the delay was announced.
The share price dropped triggered the family trust of co-founder Charif Souki being forced to sell 18 million shares to satisfy loan requirements by a lender. Some 25 million shares had been pledged as collateral to secure a loan for certain real estate investments.
The shares, which had been trading around $7 in mid-February, are now trading at around a dollar.
SEC filing – Tellurian CFO
Hongjin Tan, a Chinese national, has been sent to prison for 24 months for stealing trade secrets from Phillips 66. The company has its head office in Houston, though Mr Tan worked in Bartlesville, Oklahoma.
Mr Tan was initially arrested in December 2018 and pleaded guilty in November 2019.
Mr Tan joined Phillips in April 2017 as a research engineer in the battery development group. Prior to that, he had spent over 10 years working and studying in California.
On December 12, 2018, Mr Tan announced he was resigning and returning to China to be with his aging parents. The company conducted a systems access review and determined that Mr Tan had downloaded files onto a personal USB flash drive. The company then called in the FBI. The FBI found an offer letter (in Chinese) dated 17 October, 2018 on Mr Tan’s laptop from a company based in Xiamen, China. As well as the usual job offer details, the letter stated that Mr Tan would be compensated 400,000 RMB (approx $58,000) for information already provided. Mr Tan had visited China that September.
Phillips has advised the FBI that the company has earned $1.4 billion to $1.8 billion from the sale of the product in question.
Mr Tan was also ordered to pay $150,000 in restitution to Phillips.
Criminal complaint against Tan