RICHARD Cottee says he won't be bullied, nor will he cower under threat of legal action. He says his reputation, cut over six years as chief executive at Queensland Gas and more recently as CEO of Nexus Energy, stands for itself.
But Cottee admits he is ''gobsmacked'' by what happened at Nexus Energy on September 21 when a dispute with his fellow board members led to him quitting.
He claims he still does not fully understand it. At the same time, he says he ''could see the gathering storm''. Advertisement: Story continues below
''The board clearly did not have confidence in me,'' he told BusinessDay yesterday. ''And if the board does not have confidence in you when you are trying to make a deal complete, with all the complexity attached to it, the chances are that you become an impediment.
''I believe the board's view is that I was becoming an impediment. They were wanting to make sure that they could second-guess every minutiae in the judgment that, really, management has to make.''
Cottee quit Nexus after just 16 months because he says the board asked him to push harder on particular aspects of a complex deal when he knew those proposed terms were so utterly unacceptable to the outside party that the whole deal would fall over.
''There was a matter that had been going on for a while that I thought was essential to the company and to the shareholders' interests,'' Cottee said. ''They asked me to go back to the counterparty for the second time. I had advised them beforehand that the counterparty would not accept it, and I was right.''
Cottee said that, as he understood it, the outside party had since written to Nexus and rejected the deal.
Cottee resigned as a director on September 21, and the next day directors told the former lawyer, whom they hired in 2010 to turn around Nexus's fortunes and to bring its West Australian oil and gas assets to production, that he was no longer required as chief executive.
Cottee then received from Nexus's lawyers what he described as ''a pretty nasty, long letter threatening to sue me if I sought employment elsewhere or talked to the media or anything''.
Now Cottee has taken on the company. He has launched action in the Victorian Supreme Court seeking a declaration that clauses attached to his contract that restrain him from obtaining new employment are void and unenforceable.
As a result, the world is likely to hear a lot more about what happened inside Nexus in the days leading up to his resignation, and that explanation cannot come soon enough.
Immediately after Nexus Energy announced Cottee's exit on September 22, its shares plunged more than 50 per cent, dropping from 25.5¢ to 12¢ and slicing the market capitalisation from $338 million to $159 million. The shares closed yesterday at 17¢.
''This is not some sort of dummy spit,'' Cottee told BusinessDay, adding he is not seeking any money from the company: he made $30 million in late 2008 when British Gas, in a $5.6 billion takeover, happily relieved him of his tenure at Queensland Gas.
But he does want to be free to accept job offers. He even suggested he would consider returning to Nexus as CEO if there were changes to the board.
''I have had lots of boards and never, ever had this sort of thing before,'' he said. ''Normally there's a collegiate, of acting in everybody's interests, of binding everyone together, and if there's something to be done, then they repose that certain amount of trust and confidence in the managing director, and if they have not [got trust] they should get rid of him or her or it.''
What Cottee tried to get approved in September was a complex deal that he says would have assured Nexus of getting financing for the development of its Crux assets in the Browse Basin as well as meeting the demands of its exploration permit at nearby Echuca Shoals. To retain the permit, Nexus must drill a well.
In Cottee's view, if Nexus had taken on 100 per cent of the financial responsibility for the Echuca Shoals well, it would have thwarted Nexus's chances of closing the financing on its Crux assets.
''They did not accept my judgment,'' he said.
Nexus has said that some of the terms of the farm-out proposal Cottee presented were ''commercially unacceptable'', and on September 29 it said negotiations over the farm-in were continuing.
Cottee said all Nexus's debt had been restructured and extended beyond 2014, its cash burden had been cut from $7 million a month to $15 million a year, and the company was in a position to take on debt to fund Crux.
But he contended some of the Nexus directors came from a culture where ''they really do try to polish the unpolishable''.
He said he joined Nexus because he saw ''a challenge that needed creative flair''.
''Maybe I was delusional,'' he said. ''The commercialisation of Crux was going to quadruple the value of the company'' but the web of licensing and financing arrangements overlying the asset were hideously complex.
Cottee suggested there might also have been a personal element to his demise: ''The relationships, I would not call them poisonous or anything but I did think there could be an element of you are getting too big for your boots, Richard. So there you go. It was subterranean.
''Obviously when the trial comes about, all will be disclosed.''
He said that when he signed his employment contract in May 2010, he told Nexus its 12-month, no-compete restraint clauses were ''impossibly wide'' and he compared it to ''slavery''.
Nexus chairman Michael Fowler said Nexus would ''strenuously and vigorously'' defend the Supreme Court lawsuit: ''Nexus is currently preparing its defence and any further comment on the matter is not possible as it is now before the court.''
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