in wa paper today

Axed Central Petroleum boss John Heugh tried to subvert a board decision giving control of the company's dealmaking to its exploration manager, the Supreme Court in Perth heard yesterday.

Mr Heugh, sacked as Central Petroleum chief executive last month, was in court to block a move to have him also removed from the board, ahead of hearings to decide whether the company breached his contract by sacking him and should be forced to reinstate him.

Yesterday's court hearing exposed the rifts over dealmaking within Central Petroleum at a time when its control is up for grabs.

Over the past month it has been linked to a possible farm-in agreement with US major Hess Corp while iron ore billionaire Clive Palmer has been building a stake to try to muscle in on the Perth company's central Australain oil, gas and coal exploration projects.

The battle over Central Petroleum's strategy claimed Mr Heugh's scalp, and has also spawned competing attempts to spill the company board by the rival camps.

The Supreme Court was told yesterday the internal Central Petroleum spilled over in early February when the majority of the board voted to hand over responsibility for negotiating farm-out deals over the company's Canning Basin tenements to exploration manager Trevor Shortt, who joined the company only eight months ago.

According to affidavits read into evidence yesterday, Central Petroleum's founder resisted the decision to strip him of his powers, threatening Mr Shortt with a conduct warning if he did not insist on sharing the responsibility with Mr Heugh. Mr Shortt complied, telling chairman Henry Askin he did not have time to take sole responsibility for negotiations. Days later he had a change of heart, and complained about the pressure being applied to the board, who demanded Mr Heugh apologise and retract the conduct warning.

Lawyers for Mr Heugh told the court the Central Petroleum boss had apologised, but had not been prepared to sign a letter penned by Mr Askin, which included admissions his conduct was "unprofessional" and that senior Central Petroleum staff "deserved better".

Mr Heugh sent his own apology but was sacked within weeks, after the three other board members voted in his absence to do so. The resolution also called for a shareholder meeting to remove Mr Heugh from the board, which was the subject of yesterday's legal challenge. His lawyers told the court that calling a general meeting of shareholders would cause "irreparable damage" to Mr Heugh's reputation, by airing the allegations of impropriety ahead of a court hearing that could clear him of wrongdoing.
The hearing continues.