Business Person of the Year 2005: Charlie Fischer, Nexen Inc.
Nexen boss Charlie Fischer's patience and long-term vision paid off in 2005, earning him the title of Business Person of the Year
Nobody can quite recall the precise dollar value of the offer but it was small potatoes by today’s standards – $1 million or $2 million, tops. A joint venture partner had been nosing around, asking about the availability of Canadian Occidental Petroleum’s stake in some unexploited and obscure heavy-oil assets in northern Alberta.
During a late-afternoon strategy session, Canadian Oxy’s senior brains seemed disinclined to look a gift horse in the mouth and opted to grab the easy money and run.
Then the chief operating officer lifted an eyebrow and casually tossed out a challenge: “Wait, how much is this really worth?” Charlie Fischer queried his colleagues.
None of the brass could put a value on the bitumen leases and Fischer confessed he was in the dark as well. Almost as an afterthought, he mused: “Well, we’d better find out. Because they’re either worth nothing… or they’re worth billions.”
Eight years later, market analysts and senior executives at Nexen Inc., Canadian Oxy’s successor company, tend to agree that it’s more likely the latter. In the end, of course, the leases weren’t sold. Instead, they became seed assets for a corporate bitumen inventory which ultimately led Nexen to the $3.5-billion oilsands project, jointly owned with Opti Canada, known as Long Lake.
It’s a story told by Roger Thomas, Nexen’s chief of Canadian operations, by way of illustrating the presence of mind and down-home horse sense that’s routinely demonstrated by his boss, chief executive Charles Wayne Fischer, Alberta Venture’s 2005 Business Person of the Year.
Thomas cites the episode as evidence of Fischer’s ability to bring concrete value to a position he’s held for almost five years and which reportedly pays him $847,917 annually, not including stock options and various bonuses which approached $1.5 million in 2004.
Underpaid? Based on Nexen’s breathtaking 2005 win streak, it’s possible.
Nonetheless, it was a year of living splendidly for a grounded kid from southwest Calgary (by way of Saskatoon, his birthplace) who never doubted – or never admits to doubting – that his company’s long-range strategic plans would eventually bear fruit. Not even when Nexen’s share price descended into the energy sector underworld – sub-$20 – just two years ago, against a backdrop of falling revenues and reserve writedowns.
“No, I didn’t become a genius overnight,” Fischer shakes his head, perched high on his six-foot, three-inch frame, letting a laugh slip from beneath the flecks of grey on his trademark handlebar moustache.
“I think we had a strategy and we really stuck to it.”
And when the plan started to jell, markets responded in a big way. In fact, ravenous investors went on a buying binge that almost tripled the company’s share price, albeit temporarily.
Why? Because, suddenly, reasons for optimism were piling up like clothing on a teenager’s bedroom floor. At their prescient best, markets anticipate economic events six months to two years in advance. This year’s buyers of Nexen stock were newly inspired by the expected success of the Long Lake steam extraction process to come on stream in late 2006, leading to synthetic crude oil production in 2007. They were intrigued by Nexen’s timely purchase of North Sea fields, believed to contain 1.2 billion barrels of oil, from EnCana Corp. for $2.6 billion. They were delighted by a scheme to transform the company’s lucrative chemical division into an income trust, Canexus Income Fund, which made its debut on the Toronto Stock Exchange in August. They were gratified by improved operating results in far-flung properties from Yemen to the Gulf Coast.
Let’s see, what else? While ramping up not-yet-operational megaprojects, Canada’s fourth-largest independent oil and gas producer managed to triple its profits in the third quarter of ’05, largely by shedding a variety of “mature” assets, mostly conventional oil and gas properties in western Canada. Meanwhile, chief financial officer Marvin Romanow was anticipating cash flow of $2.4 billion by year’s end.
In short, the fiscal news was good, better, best throughout 2005. Equally significantly, it was a year in which Fischer, his inner circle of corporate courtiers and every one of Nexen’s 3,200 employees found a dozen different ways to feel good about themselves and the work they do.Pages: 1 2 3