Financial Risks

Financial security, cost management and funding options are critical to business success.

Risk Mitigants Responsibility at functional level Change
(2014 on 2013)
Inability to fund exploration work programmes
  • Regular review of cash flow, working capital and funding options, and prudent approach to budgeting and planning, to ensure sufficient capital to meet commitments.
 Director of Finance ↑
Counterparty
credit risk
  • Close monitoring of all trade debtors which are subject to internal credit review.
 Director of Finance →
Cost and capital spending
  • In the present oil price environment Ophir is focused on preserving its balance sheet and during 2014 and into 2015 there has been an increased focus on cost management and capital allocation. Whilst the Company doubled the physical size of its exploration footprint in 2014, it has secured new acreage without any commitment wells, which maintains balance sheet flexibility.
  • Optimise and protect Ophir’s capital by capturing highest commercial returns on assets, prioritised its capital expenditure to protect its balance sheet and reduce its cost structure.
  • A formalised annual budget process and ongoing monthly reviews of actuals to budget analysis. Delegation of authority, approval processes and C&P procedures.
  • Board approval of Annual Work Programme.
 Director of Finance →
Interest rate and foreign exchange risk
  • The Company regularly reviews the organization to ensure it is appropriately resourced to deliver its objectives.
  • Ophir relies on the excellence of a team of experienced Oil and Gas professionals for its operational success. In order to retain, motivate and recruit suitably qualified employees it ensures its remuneration packages are competitive.
  • It has established a Long-Term Incentive Plan (LTIP) for Executives and a Deferred Share Plan for staff.
 Director of Finance →