Icon directors held to task by cautious investors

Written on the 8 June 2010

CAUTIOUS shareholders of Icon Energy have voted against a proposed increase in remuneration for directors, despite the junior explorer’s potential $32 billion export deal with China’s Shenzhen Sino Industrial Development Company.

At its recent AGM the board sought to increase the current pay cap for non-executive directors from the current cap of $250,000 to $750,000, but the move was overwhelmingly shut down by proxy voters. Two extra directors would cost an additional $150,000.

Outgoing CFO Ray McNamara, says adept corporate governance could be stymied if the board could not expand its expertise.

“I’m a little mystified as to why they (shareholders) would not be in favour,” he says.

“Normally we would expect a company of Icon’s size to have five non-executive directors on the board, we currently have three. With me stepping down from the board there will be no-one with formal financial qualifications. We are not going to get good governance if you want to pay the board as a $100 million company instead of a $300 million company.”

CEO Ray James, who has 21.1 million Icon shares equating to around $7 million, admits the resolution was not well understood.


“That’s obvious. It’s a shame not to hear that resolution passed. There’s no option but to add another executive director or wait until the next AGM,” he says.

“There is no intent to alter directors’ fees other than the normal process. It’s not the case that directors will double their pay.”

Icon’s core business is focused on the coal bed methane gas reserves in permit ATP 626P in the Surat Basin, near Dalby. The biggest hurdle now facing the company is to find the gas and to reignite shareholder confidence.

“Lydia is right on the brink of becoming commercial. We have to kick the goals along the way. There are milestones everywhere but people forget that only three to four years ago, there was nothing in Queensland gas (CSG),” says James.

Icon continues to strengthen after picking up the former City Pacific headquarters in what was considered a firesale last year for $9.5 million.


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