STATEMENT OF CORPORATE GOVERNANCE Role of the Board of Directors Composition of the Board of Directors 84 Karoon Gas Australia Ltd  Annual Report 2011 The Board of Directors is constituted by five Directors. The skills, experience and expertise relevant to the position of each  Director who is in office at the date of the Annual Report and their term of office are detailed in the Directors’ Report. The Non-Executive Directors of the Company are Mr Geoff Atkins, Mr Clark Davey and Mr Stephen Power. Mr Geoff Atkins and  Mr Clark Davey are Independent Directors. The Company considers Mr Stephen Power to be a Non-Independent Director, due to  Napier Legal Pty Ltd, a law firm in which Mr Power has an interest, providing legal services to the Company. These services are  provided by Napier Legal Pty Ltd on normal commercial terms and conditions and at market rates. Recommendation 2.1 of the revised Corporate Governance Council Principles provides that a majority of the Board of Directors  should be Independent Directors. The Company does not currently comply with this Recommendation. The composition of the  Board is reviewed on an ongoing basis having regard to the growth of the Company’s business, with a view to appointing a majority of Independent Directors.  The Company’s Board Charter can be found on the Company’s website at www.karoongas.com.au. The roles and responsibilities of the Board of Directors are to oversee and direct the senior management of the Company by: The second edition of the revised ASX Corporate Governance Council Principles and Recommendations published during August  2007 (revised Corporate Governance Council Principles) established the framework for how the Board of Directors oversees the  Company and performs its functions on behalf of shareholders. The Company’s objective is to achieve best practice in corporate  governance and the Company’s Directors, senior management and employees are committed to achieving this objective. This statement summarises the Company’s key corporate governance principles and practices. •  defining and monitoring the strategic direction of the Company; •  defining policies and procedures to ensure the Company operates within the legal, ethical and social requirements of its  environment; •  establishing control and accountability systems within the Group’s operations to conform to the legal requirements and the  expectations of shareholders and other stakeholders; •  defining and monitoring the management of an effective risk assessment strategy; •  securing funds to develop the Company’s assets; •  driving Company performance; •  from time to time, reviewing and monitoring management and Company performance; •  appointing and appraising the Executive Chairman and any other Executive Director; •  ensuring there are adequate plans and procedures for succession planning; •  reviewing and approving the remuneration of the Executive Chairman, any other Executive Director and senior management; •  approving and monitoring the progress of major capital expenditure, capital management, acquisitions and divestitures; and •  approving and monitoring financial and other reporting.