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TORONTO - First Calgary Petroleums Ltd.'s (TSX:FCP) forthcoming annual meeting could see some fireworks after three members quit the board of the energy company as it tries to beat back a dissident shareholder motion to remove its CEO over the development of the MLE natural gas field in Algeria.

Scotia Capital's talks with institutional investors "have pointed toward mixed views on the current management team, and in our estimate appear to be split 50/50 on those for and against," Gavin Wylie, a financial analyst with the brokerage, said in a research note to clients Monday.

Rick Anderson, president and CEO, has urged shareholders to reject the motion at the April 8 meeting in Calgary. If adopted, he says, the motion would be "extremely detrimental" to shareholder value as it would likely delay the company's goal of first development of the MLE field in 2010.

But in a statement released Monday, dissident shareholder Waterford Finance and Investment Ltd. said First Calgary needed to be restructured so it "can begin to ... deliver appropriate returns to all its shareholders."

Wylie said that "while a change in management may create some renewed interest in the (company's) name, removing key players that have formed good working relationships with Algerian authorities opens the door for significant days in achieving first production of MLE."

Under Scotia Capital's analysis, he said, "a delay of one year in first production would reduce our base (net asset value) by 20 per cent (to $2.83 per share), while a delay of two years would point toward a decline of 45 per cent (to $1.96 per share)."

On the TSX Monday, First Calgary shares closed up 24 cents, or about nine per cent, to $2.90 on more than 763,000 shares traded, after opening trading at 32 cents, or up 12 per cent, at $2.98.

In a release Sunday, the resignations of Alastair Beardsall, Yuri Shafranik and Keith Henry, who were linked to the dissident group, were effective immediately.

The board of directors of First Calgary is now comprised of CEO Richard Anderson, Gar Emerson, Shane O'Leary, Darryl Raymaker and John van der Welle.

A new slate of directors is to be elected by shareholders at the annual meeting in Calgary.

First Calgary has nominated Roy MacLaren, a former Liberal MP and cabinet minister, Stuart McDowall, David Savage and former Canadian diplomat now consultant Ken Taylor for election to the board.

Anderson is under attack by a dissident investor group represented by London-based Waterford and Midocean Holdings Ltd. over his handling of the development of the Algerian natural gas field.

Last Wednesday, the dissident group filed a proxy circular seeking the support of other concerned shareholders for the motion to remove Anderson as president and CEO and as a director of the company.

The motion, put forward in December, will be voted on at the annual meeting.

Shareholders are also expected to vote on various dissident proposals put forward by Waterford and Midocean Holdings on April 4, said Wylie.

The resignations of the three directors are "just circling around this motion" that effectively would restructure the company, said Wylie.

"The three people that have resigned are now being proposed to be put back on the board should they effectively remove Rick Anderson from the board along with the current group of directors."

In the past, the dissident shareholders have said First Calgary needs an experienced leader to bring the massive Algerian natural gas asset onstream.

They have said Anderson was "great" for securing the deal, but argue that "a different set of skills" will be required to commercialize the project.

During a conference call last Thursday, the company said the development of the MLE field is "on budget and on schedule," after posting a net loss of $11.7 million in 2007.

Anderson has accused the dissidents of trying "to take control of the company without paying for it."

Despite all the turmoil in credit markets and within the company, said Wylie, First Calgary "appears confident that oil and gas based lending remains healthy."

First Calgary expects to close its financing arrangement with various financial institutions for US$1 billion to US$1.2 billion in long-term debt for the Algerian project and award its engineering, procurement and construction contract by the third quarter of fiscal 2008.

Wylie said the bank is maintaining its "2-Sector Perform" rating and its one-year target of $4.25 per share.

In Scotia Capital's view, he said, First Calgary "appears to be back on the path to value creation, contingent upon achieving project financing in the third quarter and first production as early as 2010."

While Algeria can be a difficult region to operate in given religious/political/social turmoil and state oil company Sonatrach's significant level of control over oil and gas operations, Scotia Capital considers First Calgary's management team "to have a favourable standing with Sonatrach," said Wylie.