Elliott Funding Administration LP has nominated seven candidates with the “best-in-class expertise in refining and midstream operations”, together with an Elliott associate, for election to Phillips 66’s board on the firm’s upcoming yearly assembly of shareholders.
The investor, which has a declared funding of over $2.5 billion in Phillips 66, is pushing for portfolio simplification, an operational evaluation and stronger oversight, blaming Phillip66’s present construction and management for “persistent underperformance”.
“The director nominees introduced right this moment will carry the suitable expertise and goal views to the Board because it executes one of the best path ahead for the Firm, together with by bolstering accountability and bettering oversight of administration initiatives”, Elliott mentioned in a web based assertion Tuesday.
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The nominees are Brian Coffman, ex-chief government of Motiva Enterprises and former senior vice chairman (SVP) for refining at Andeavor; Sigmund Cornelius, former SVP and chief monetary officer of ConocoPhillips; Michael Heim, co-founder and former president and chief working officer of Targa Assets; Alan Hirshberg, former government VP for manufacturing, drilling and initiatives at ConocoPhillips; Gillian Hobson, former capital markets associate at Vinson & Elkins; Stacy Nieuwoudt, former power and industrials analyst at Citadel; and John Pike, associate at Elliott.
Two of Phillips 66’s 14 seating administrators, 13 of whom are impartial based on the corporate, have determined to not stand for re-election, based on a disclosure with the Securities and Change Fee (SEC) February 12.
Gary Okay. Adams and Denise L. Ramos’s choices “weren’t the results of any disagreement between both director and the Firm regarding the Firm’s operations, insurance policies or practices”, Phillips 66 informed the SEC.
In Tuesday’s assertion Elliott famous Phillips 66 “has not disclosed what number of seats will now be up for election or who it is going to be nominating”.
“Elliott’s candidates have been chosen by a complete search course of to determine professionals with complementary backgrounds and expertise associated to bettering refining and midstream operations, evaluating complicated strategic transactions and enhancing company governance”, Elliott added.
“Previous to the submitting of Elliott’s definitive proxy supplies, Elliott will determine the ultimate slate of director candidates that can stand for election on the Annual Assembly”.
Concurrently Elliott introduced a non-binding proposal for Phillips 66 to institute annual director elections.
“Over 5 of the final 9 years, the Firm has put ahead a number of proposals to declassify the Board – all of which obtained sturdy stockholder help (together with 99 p.c of the shares voted in 2023) however failed to realize the 80 p.c supermajority threshold of shares excellent to permit for a Constitution modification”, Elliott mentioned.
Phillips 66 has but to answer to a remark request emailed by Rigzone.
For the fourth quarter of 2024 Phillips 66 noticed refining losses deepen to $775 million from $108 million for the prior quarter. For the fourth quarter of the prior 12 months, Phillips 66’s refining enterprise logged $814 million in internet earnings.
Realized refining margins averaged $6.08 a barrel within the October-December 2024 interval, down from $8.31 for the prior quarter and $14.41 for the corresponding quarter in 2023.
Phillips 66 posted $8 million in internet revenue for the fourth quarter of 2024, a dramatic fall from $1.26 billion for a similar three-month interval in 2023.
Phillips 66 stored its crude capability utilization steady at 94 p.c between the third and fourth quarters of 2024.
Refining turnaround bills dropped sequentially from $137 million to $123 million.
When adjusted for extraordinary or nonrecurring gadgets, the refining section lands at a $759 million internet loss for the fourth quarter of 2024, in comparison with a $67 million internet loss for the third quarter of 2024.
Earlier than curiosity, tax, amortization and depreciation deductions, the refining section had an adjusted internet lack of $298 million, in comparison with an adjusted internet revenue of $188 million for the previous quarter.
“Refining adjusted pre-tax loss elevated [quarter-on-quarter] primarily on account of a decline in realized margins largely pushed by decrease market crack spreads and accelerated depreciation related to the deliberate ceasing of operations on the Los Angeles Refinery, partially offset by the next clear product yield”, Phillips 66 mentioned in its quarterly report revealed January 31, 2025.
Phillips 66 introduced October 16, 2024, it might stop manufacturing on the Los Angeles refinery by the top of 2025, with chief government Mark Lashier citing uncertainty from “market dynamics”.
To contact the writer, electronic mail jov.onsat@rigzone.com
