As the company moves to restructure its management position it has also announced the appointment of former senior BP executive, Richard Harding, as a director, effective 1 March.

The restructuring will be the second under Ellice-Flint's tenure and is one which he claims is necessary to flatten out the company's management structure. The company says it has already made savings of over $188 million by cutting operating costs since 2001 and is set to incorporate the new program from early May this year.

Ellice-Flint announced the changes after an investigation by US-based management consultant Booze-Allen & Hamilton which recommended the restructure.

Santos yesterday announced an annual profit of $327 million boosted by a one off tax benefit of $55 million after Santos rationalised the tax positions of its 100% owned subsidiaries. The company also wrote off $59.7 million during the year in unsuccessful exploration activities.

The profit was also boosted by the $45.8 million sale of the company's interest in Oil Company of Australia which enabled it to record a 2.5% increase on 2002's net profit.

New director Harding retired in 2003 from BP Exploration Australia where, from 1996, he held the position of president and general manager of BP Developments Australia Limited. His responsibilities included upstream assets in Australia, Papua New Guinea and Malaysia/Thailand.

Harding is also a former Council member of the Australian Petroleum Production and Exploration Association (APPEA) and a director of Arc Energy.