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Connacher hires Goldman to review strategic options

Richard Gusella resigned recently as president and CEO of Connacher Oil and Gas Ltd.

Chris Bolin/chris bolin/The Globe and Mail

Connacher Oil and Gas Ltd. announced Friday that U.S. investment banker Goldman Sachs has been hired to help the company explore its strategic options.

The move by the Calgary oil sands developer comes in the wake of the abrupt departures in recent weeks of many of Connacher's top executives, including CEO Dick Gusella just over a week ago.

Those changes came less than a month after the firm rejected an unsolicited takeover offer from an unnamed company.

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Some of Connacher's biggest shareholders had urged the sale, but Mr. Gusella was against it and there has been speculation the earlier management shake-up was the result of a disagreement over the sale.

Meanwhile, Connacher says it continues to experience strong financial results and has sufficient liquidity to meet all of its current financial obligations and to fund its 2012 capital program.

However, it says the board has initiated a process to review Connacher's business plan and to consider all strategies available, both near and long term.

As far as the strategic review is concerned, the company said it does not intend to make any further announcements until the board has approved "a particular course of action or otherwise deems disclosure of developments is appropriate."

"In the meantime, the company would like to reassure shareholders and other stakeholders that the company's day-to-day operations are stable with no compromise in operating activities," it said.

Connacher's primary asset is its 100 per cent ownership of bitumen reserves and production from two steam-assisted gravity drainage, or SAGD, projects – Pod One and Algar, at its Great Divide oil sands lease block in northeastern Alberta.

Connacher also owns and operates a profitable 9,500 barrels per day heavy crude oil refinery in Great Falls, Mont., and conventional lands, reserves and production in central Alberta.

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