Alberta Oil’s first annual C-Suite Stars awards recognizes those individuals that proved to be capable of surviving, thriving and building platforms for future growth through events that few imagined to be possible until they happened.

Times turned tough. Talent stood out.

As this year wore on, the shocks of the late-2008 energy price drop and global credit crisis faded but severe effects lingered. It has been survival of the fittest.

Within the context of this challenging year, the 2009 C-Suite Stars were selected based on observed trends and performances. This group of six emerged from qualified candidates.

The selection process started with recognition that there is far more to industry leadership than can ever be measured by quarterly financial statements. Alberta Oil bases its views on trends spotted with full-time daily tracking of developments revealed by an array of sources, from corporate disclosures and article interviews to regulatory cases and travel to industry operating areas.

Alberta Oil identified three key trends this year. First was the rise of resource plays, with the formerly little-known term coming into common use for a harvesting or manufacturing approach to producing energy commodities with advancing technology. Not surprisingly, there was also sharpened focus on economic efficiency as energy prices slid and showed signs of staying well down from 2008 highs for the foreseeable future. Finally, the industry responded to a growing emphasis on adapting to increasingly sensitive natural and human environments.

As the inaugural C-Suite Stars demonstrate, the fittest can do more than survive – they can excel.

Chief Executive Officer Randy Eresman, EnCana Corp.
The Game Changer

Encana’s CEO is transforming the gas industry’s M.O.

Randy Eresman’s enthusiasm is infectious. Zest breaks through the professionally reserved exterior of the petroleum engineer in the chief executive officer’s suite at EnCana Corp. when he talks about the future his teams are building.

The example set by EnCana’s rise to the top among North American natural gas producers – a stature highlighted by the Eiffel Tower-like steel frame under rapid construction for the firm’s new 58-storey headquarters and Calgary’s tallest skyscraper – is changing the structure and vocabulary of the energy industry. Enter resource plays.

“We now call them gas factories,” Eresman says in describing the new M.O. The old standard method of operating prompted previous generations of trend-setters to call themselves hunters and coin the word explorationists. The new pattern has industry leaders billing themselves as manufacturers.

The old way was a secretive pursuit of wealth needles – scattered fossil fuel deposits concentrated by natural pressure on porous rock formations into pools that flowed at the touch of drill bits. The new approach harvests entire geological haystacks by using advanced technology to extract resources embedded too tightly in dense rock to flow except through artificial capillary webs of man-made channels.

Instead of derricks built in portable pieces that spend much of their time roving around widely dispersed targets, the new M.O. is evolving fit-for-purpose rigs that work around the clock at fixed locations. In a resource play, ownership is acquired over a big block of rock saturated with fossil fuel. A stable pad or working surface is built. Self-propelled rigs that swivel and move short distances, akin to robots on auto assembly lines, drill potentially dozens of kilometers-long horizontal wells across the geological formation. Multiple “fracs”, or injections of fluids under extreme pressure, fracture myriad flow channels into tightly grained rock by breaking it up the way a sudden impact shatters a safety glass window.

“You gain amazing efficiency by not moving equipment,” Eresman says. Along with the specialized drilling rigs, truck-mounted frac pumping equipment stays on location and uses low-cost deliveries of bulk materials. Sites are organized and lit up to run safely around the clock seven days a week. Operating services such as pipelines, power supplies, instrument arrays, control systems and crew quarters are large and concentrated with their costs spread thinly over high production volumes. Environmental effects are reduced compared to the old pattern of widely dispersed wells, spiders’ webs of long but small-diameter pipelines and scattered processing plants.

EnCana uses the new approach in Wyoming and Texas, and is transplanting it into Canada, initially at northern British Columbia’s Horn River shale gas deposit. The new industry M.O. is tailor-made for the long-range market outlook that overtook the old hunting methods in 2009. “A lot of our industry has been inspired with the idea of ever-rising energy prices,” Eresman recalls. “This new strategy works well with flat long-term prices. We think natural gas will be constrained in a narrower and lower range than we used to believe in.”

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