Next Up: CEO of Daroil Energy on running the family business
Ranny Shibley used to have a hard time getting people to take him seriously. That’s not a problem anymore
by Max Fawcett
Jay Feaster might want to watch his back. It’s not that he hasn’t done a good job since taking over as the general manager of the Calgary Flames in 2010. But lifelong fan and local businessman Ranny Shibley is clear that he’d take the job if it was offered to him – and given both his particular skill set in the energy sector and his track record of success that’s resulted from it, that might not be as improbable an idea as you might think. After all, the Flames have done stranger things before – they did trade away Brett Hull and Doug Gilmour in the span of five years.
Photograph A.J. Valadka
In the meantime, Shibley is more than happy to spend his days as the CEO of Daroil Energy, a privately held and family-owned business that was started by his father Jihad and older brother Danny in November 2002. Ranny, who’s the middle of three sons, took over as CEO in 2006 after his older brother left the business to start a home-building company. “He hated the energy industry,” Shibley says. That’s certainly not the case with Shibley himself, though. He got his first taste of the business at the age of 12, when his father asked him to do some work around the office for the energy company that he’d started in the 1990s, after a lifetime spent climbing the ranks at Dome Petroleum. “I’d photocopy this, fax that and put together the quarterly and yearly reports,” Shibley says. “Simple stuff, but I’ve had my toes dipped in the pool for a while.”
After graduating from the University of Calgary’s school of engineering, and working at Daroil part-time while attending school, Shibley took over the day-to-day operations of the company. And while the company’s production has grown 15-fold and its cash flow 10-fold since he took over, it hasn’t always been easy. As a 23-year-old CEO (he’s 30 now), he found himself standing in a few boardrooms where the people across the table weren’t really listening. “My first couple of years in the industry, when I was trying to go in and negotiate million-dollar deals, there were a lot of people that just wouldn’t take me seriously,” he says. But while those people may not have been willing to give him the benefit of the doubt, Shibley isn’t nearly so petty. “They might have just been having a bad day, and they could have treated someone who was twice my age the same way,” he says. “I hold no animosity towards anyone. The way you move forward in this industry isn’t by making enemies. It’s by making friends.”
He made a bunch of those in 2010, when he pulled off a deal that earned him the respect of even his most reticent peers. A friend from engineering school tipped him off to the fact that a Korean company was looking to break into the Canadian oil and gas market, but didn’t know where to begin. Shibley did. “We were evaluating another property, and dealing with another company that had a large asset in the Maxhamish Lake region of B.C., and we thought this might be a good fit. And so what started as a 45-minute meeting turned into a 10-month-plus process, and we ended up closing a $152-million deal and bringing a Korean conglomerate into Alberta.”
That’s not Daroil’s core area of business, mind you – not yet, anyways. Instead, the company is focused on buying undervalued assets – be it a single well or a package of land – and unlocking the value that it thinks is being ignored by the market. In essence, it flips energy assets the way a real estate investor might a pre-sale condominium or a fixer-upper house. “If we see a property and we like it, we go after it,” he says. “We stay out of the oil sands, because that’s where the big boys play. But for anything else, if it makes sense we’ll put in an offer.” It’s a buyer’s market right now, too, with many of the province’s junior energy companies just trying to stay afloat either by divesting non-core assets or staying out of the bidding for new ones. That’s good news for a company like Daroil that’s privately held, fully capitalized and able to move nimbly. “One of our advantages is that we’re able to act quickly because we’re a private company,” Shibley says. “If something comes up and it’s got a short time-fuse, we’re able to pounce on that.”
But while it might pounce, it won’t double down. Despite its size – or, perhaps, because of it – Daroil is always careful to remain diversified both in what it owns and where it owns it. That’s a lesson that Shibley says he picked up from his father, now retired. “He learned a long time ago that it’s good to diversify and to own some other assets, because you never know what will happen. You can’t control what’s out there, but you can control what you invest in.” Speaking of which, Shibley says that Daroil’s future could include other matchmaking opportunities like the one it brokered with the Korean company – perhaps, even, a new line of the business. “We’d have to compete with a lot of the bigger banks and companies in doing that,” he says, “but the experience we had with the Korean company was fantastic.” He adds that other parties have already contacted the company based on that experience and the positive outcome that both sides enjoyed.
Could that desire for diversification even include a role with a certain professional sports franchise one day? If it did, Shibley, who travels once a year with friends to watch the Flames play on the road, says he’d focus on bringing in good role players instead of just big names – a nod to the way he runs his business today. And while he’s playful about the odds of him ever becoming the general manager of his favourite hockey team, he turns serious after thinking about it a bit for a moment. “You know what,” he says. “I think I’d rather own the team.”