By Roger Choudhury and Investment Underground Editors
We looked at the energy landscape for the best CEOs and chairmen in the business. Should the turmoil continue in the Middle East, these companies have the financial wherewithal and shrewd allocators at the helm to navigate tough waters at home and abroad.
They can succeed while maintaining shareholder-friendly policies relative to their peers. The companies (in un-ranked order) with the top-stewards are:
Noble (NE) is led by David W. Williams, who is the chairman of the board, president, and CEO. Mr. Williams served as SVP of Business Development of Noble Drilling Services, from September 2006 to January 2007, as SVP of Operations of Noble Drilling Services from January to April 2007, and as SVP and COO of Noble from April 2007 to January 2, 2008. Prior to September 2006, Mr. Williams served for more than 5 years as executive VP of Diamond Offshore Drilling (DO), an offshore oil and gas drilling contractor.
In 2010, the company made $2.8 billion in revenues, which was a decrease of 22.9%, after rising 5.6% in 2009. The EBT margin was 32.65% in 2010, but 55.37% in 2009. The returns on equity (ROE) in 2010 and 2009 were 11.09% and 27.79%, respectively. Going forward, the 30-day put/call ratio is 0.7. Share price is up 24.2% since December 17, 2010, when a street vendor, Mohamed Bouazizi, lit himself on fire in Tunisia.
The company has been around for 90 years. It performs contract drilling services with a fleet of 69 offshore drilling units and 5 pending drilling rigs, located worldwide, including in the Middle East, India, the US Gulf of Mexico, Mexico, the Mediterranean, the North Sea, Brazil, West Africa and Asian Pacific. Noble also owns and operates a dynamically positioned floating production, storage, offloading vessel.
Magellan Midstream (MMP) is led by Michael N. Mears. Mr. Mears currently serves as chairman of the board, president and CEO. He was previously COO. From 2002 to 2007, he served as VP of Transportation and then as SVP of Terminals and Transportation from 2007 until 2008. Prior to joining Magellan in 2002, Mr. Mears served as a VP of subsidiaries of Williams from 1996 to 2003. He also worked in various management positions with Williams Pipe Line Company (now known as Magellan Pipeline) since joining Williams in 1985.
The company made $1.55 billion in revenues in 2010, which was an increase of 53.5%, after declining 16.38% in 2009. The EBT margins in 2010 and 2009 were 20% and 22.49%, respectively. The returns on partners’ capital were in 2010 and 2009 were 21.4% and 18.9%, respectively. Options investors are very bullish on this company because the put/call ratio is 0.1. Share price is up 10.2% since December 17, 2010.
Magellan Midstream is principally engaged in the transportation, storage and distribution of refined petroleum products and crude oil. As of December 31, 2010, its asset portfolio consists of petroleum pipeline system, comprised of approximately 9,600 miles of pipeline and 51 terminals; petroleum terminals, which includes storage terminal facilities (consisting of 6 marine terminals located along coastal waterways and crude oil storage in Cushing, Oklahoma) and 27 inland terminals; and ammonia pipeline system, representing our 1,100-mile ammonia pipeline and six associated terminals.
Rowan (RDC) is led by W. Matt Ralls, who is the president and CEO. Mr. Ralls was appointed to these positions, and elected as a director of Rowan in January 2009. Mr. Ralls was with GlobalSantaFe, an international contract drilling company, from 1997 until the completion of the merger of GlobalSantaFe with Transocean in November 2007. He served as GlobalSantaFe's executive VP and chief operating officer from 2005 through 2007, and prior to that was SVP and CFO. Mr. Ralls is a director and chairs the Audit Committee of Complete Production Services and is a former director of Enterprise Products, El Paso Partners and Kelley Oil and Gas Corporation. He is the current chairman of the International Association of Drilling Contractors and a member of the Board of the American Petroleum Institute.
The company generated $1.8 billion in revenues in 2010, which was an increase of 2.7%, after tumbling 20% in 2009. The EBT margins in 2010 and 2009 were 20.8% and 28.3%, respectively. The respective ROEs were 9.79% and 12.7%. The 30-day put/call ratio is 0.4. RDC is up 23.5% since December 17, 2010.
Rowan is a major provider of international and domestic contract drilling services.
Frontier Oil (FTO) is led by chairman, president, and CEO, Michael J. Jennings, who was appointed on January 1, 2009. Mr. Jennings joined the company in June 2005 as executive VP and CFO. Prior to joining, Mr. Jennings was employed by Cooper Cameron beginning in May 2000 as VP & treasurer, with responsibilities including managing merger and acquisition activities, the tax and corporate finance areas, Cooper Cameron’s liquidity and capitalization and overseeing bank and rating agency relationships. From November 1998 until May 2000, he was VP Finance & Corporate Development of Unimin, a producer of industrial minerals. Prior to November 1998, Mr. Jennings was employed by Cooper Cameron as Director, Acquisitions and Corporate Finance from July 1995 until November 1998. He was appointed a director of FTO in November 2008.
The company made $5.8 billion in revenues in 2010, which was an increase of 38.89%, after falling 34.8% in 2009. The EBT margins in 2010 and 2009 were 0.91% and - 3.1%, respectively. The respective ROEs were 3.9% and - 8.4%. The 30-day put/call ratio is 0.3. Share price is up 61.9% since December 17, 2010.
Frontier Oil is an independent energy company, engaged in crude oil refining and the wholesale marketing of refined petroleum products. The company operates refineries in Cheyenne, Wyoming and El Dorado, Kansas with a total annual average crude oil capacity of ~187,000 barrels per day.
Arch Coal (ACI) is led by Steven F. Leer, who is serving as chairman of the board and CEO. Mr. Leer has been the CEO since 1992. From 1992 to April 2006, Mr. Leer also served as president. In April 2006, Mr. Leer became chairman of the board of directors. Mr. Leer also serves on the boards of the Norfolk Southern Corporation, USG Corp., the Business Roundtable, the BRT, the University of the Pacific, Washington University and is past Chairman of the Coal Industry Advisory Board. Mr. Leer is past chairman and continues to serve on the boards of the Center for Energy and Economic Development, the National Coal Council and the National Mining Association.
In 2010, the company made $3.18 billion in revenues, which rose 23.6%, after falling 13.66% in 2009. The EBT margins in 2010 and 2009 were 5.55% and 0.99%, respectively. The respective ROEs were 7.1% and 2.19%. The 30-day put/call ratio is 0.6. ACI is up 3.7% since December 17, 2010.
St. Louis-based Arch Coal is the second largest U.S. coal producer. We also believe Buffett might be interested in Arch, as we wrote about here.
Chevron (CVX) is led by John S. Watson, the chairman and CEO, which was assumed on January 1, 2010. Watson joined Chevron in 1980 as a financial analyst. He held financial, analytical and supervisory positions before being elected President of Chevron Canada in 1996. In 1998, he was elected a VP of the corporation, with responsibility for strategic planning and mergers and acquisitions. In 2000, he led the company’s integration effort following the Chevron-Texaco merger and then became the corporation's chief financial officer. In 2005, he was elected President of Chevron International Exploration and Production, with responsibility for the company's exploration and production activities outside North America. In 2008, he was elected executive VP for strategy and development. Watson is also the Chairman of the Board of Directors and the Executive Committee of the American Petroleum Institute. He is also a member of the National Petroleum Council, The Business Council, Business Roundtable, the JP Morgan International Council, and the American Society of Corporate Executives.
Chevron brought in $204.9 billion in revenues in 2010, which was an increase of 19.4%, after falling 37.1% in 2009. The EBT margins in 2010 and 2009 were 15.6% and 10.79%, respectively. The respective ROEs were 19.3% and 11.7%. The 30-day put/call ratio is 0.4. CVX is up 15.5% since December 17, 2010.
Cimarex (XEC) is led by F. H. Merelli, who is the chairman of the board, CEO, president and director since September 30, 2002. Prior to its merger with Cimarex, Mr. Merelli had been the chairman and CEO of Key since 1992.
The company made $1.6 billion in revenues in 2010, which was an increase of 59.8%, after declining 48.75% in 2009. The EBT margins in 2010 and 2009 were 56.6% and -48.37%, respectively. The respective ROEs were 24.7% and -14.2%. The 30-day put/call ratio is 0.8. XEC is up 29.2% since December 17, 2010.
Cimarex is an independent oil and gas exploration and production company. operations are mainly located in Texas, Oklahoma, New Mexico, Kansas and Wyoming. Proved oil and gas reserves as of year-end 2010 totaled 1.9 Tcfe, consisting of 1.3 Tcf of gas and 105 million barrels of oil and natural gas liquids. Of total proved reserves, 67% are gas and 77% are classified as proved developed. 2010 production averaged 595.9 MMcfe per day, comprised of 363.9 MMcf of gas per day and 38,674 barrels of oil and natural gas liquids per day. The company operates the wells that account for 79% of our total proved reserves and approximately 85% of production.
Enbridge (ENB) is led by Patrick D. Daniel, who is the president and CEO. Mr. Daniel is also a member of the Enbridge Inc. board of directors. Prior to his current appointment, he was president & COO, and also previously served as CEO of Interprovincial Pipe Line. Mr. Daniel also held senior management positions with Hudson’s Bay Oil & Gas and Home Oil.
David A. Arledge has been chairman of the board of directors since May 2005. From 1983 until 2001, Mr. Arledge was principally employed by Coastal Corporation (energy company) which merged in early 2001 with El Paso Corporation (integrated energy company). He held various executive positions in finance from 1983 to 1993, including SVP of Finance & CFO, and from 1993 to 2001, he held many senior executive and operating positions, most recently retiring as chair, president & CEO Officer. Mr. Arledge served as vice chairman of the board of directors of El Paso Corporation until his resignation in November 2001, having served in that capacity since the merger of Coastal Corporation and El Paso Corporation.
The company made 15.1 billion CAD ($15.5 billion) in revenues in 2010, which was an increase of 21.35%, after falling 22.7% in 2009. The EBT margins in 2010 and 2009 were 8.07% and 15.28%, respective. The respective ROEs were 13.2% and 22.8%. The 30-day put/call ratio is 0.3. Share price is up 8.3% since December 17, 2010.
The company transports energy, operating the world's longest, most sophisticated crude oil and liquids transportation system. It has a growing involvement in the natural gas transmission and midstream businesses, and it is expanding its interests in renewable and green energy technologies, including wind and solar energy, hybrid fuel cells and carbon dioxide sequestration. The company also distributes energy, owning and operating Canada's largest natural gas distribution company, and provide distribution services in Ontario, Quebec, New Brunswick and New York State.
ExxonMobil (XOM) is led by Rex W. Tillerson. Mr. Tillerson was elected chairman and CEO in 2006; president and director in 2004; and SVP in 2001. Mr. Tillerson has held a variety of management positions in domestic and foreign operations since joining the Exxon organization in 1975, including president, Exxon Yemen and Esso Exploration and Production Khorat; VP of Exxon Ventures; president, Exxon Neftegas; and executive VP of ExxonMobil Development Company.
ExxonMobil made $383.2 billion in revenues in 2010, which was an increase of 23.39%, after falling 34.9% in 2009. The EBT margins in 2010 and 2009 were 13.8% and 11.2%, respectively. The respective ROEs were 23.67% and 17.25%. The 30-day put/call ratio is 0.7. Share price is up 17.4% since December 17, 2010.
Forest Oil (FST) has dual leadership roles. Mr. H. Craig Clark has served as president, CEO, and director since July 2003. Mr. Clark joined Forest in September 2001, and served as president and COO through July 2003. Mr. Clark was employed by Apache, an oil and gas exploration and production company, from 1989 to 2001, where he served in various management positions including executive VP of US Operations, and chairman and CEO of Pro Energy, an affiliate of Apache.
Mr. James D. Lightner has served as non-executive chairman of the board since May 2008, and has been a director since 2004. Mr. Lightner is CEO of Beacon E&P, an oil and gas exploration company, since its inception in 2009. Mr. Lightner was a partner and CEO of Orion Energy, an oil and gas exploration and production company, from its inception in August 2004 until its winding down in 2009. From 1999 to 2004, Mr. Lightner served in various capacities with Tom Brown, an oil and gas exploration and production company, including director, chairman, CEO and president, until its sale to EnCana Oil & Gas (USA) in 2004. Prior to 1999, he served as VP and general manager of EOG Resources, a publicly traded oil and gas exploration and production company. Mr. Lightner had been a director since November 2004 of W-H Energy Services, an oil field services company, until its sale in July 2008.
The company made $855 million in revenues in 2010, which was an increase of 11.2%, after dropping 53.35% in 2009. The EBT margins in 2010 and 2009 were 40.7% and - 186.56%, respectively. The respective ROEs were 18.7% and - 67.09%. The 30-day put/call ratio is 0.9. FST is down 4.2% since December 17, 2010.
Forest Oil is engaged in the exploration, acquisition, development, production and marketing of natural gas and crude oil in North America and in selected international locations. Corporate headquarters are located in Denver, Colorado, with principal reserves and producing properties in Arkansas, Louisiana, New Mexico, Oklahoma, Texas, Utah, and Wyoming, and in Canada. The company was launched in northwestern Pennsylvania in 1916, incorporated in 1924, and has been publicly held since 1969. The company operates 5 geographic business units, which include Canada, Eastern, Southern, Western and International.
Buckeye Partners (BPL) is led by Forrest E. Wylie, who has been the chairman of the board, CEO, and General Partner since June 25, 2007. Mr. Wylie was also the president of Buckeye GP and the general partner of BGH from June 25, 2007 until he resigned, solely from such positions, on October 25, 2007. Prior to his appointment, he served as vice chairman of Pacific Energy Management, an entity affiliated with Pacific Energy Partners, a refined product and crude oil pipeline and terminal partnership, from March 2005 until Pacific Energy Partners merged with Plains All American in November 2006. Mr. Wylie was president and CFO of NuCoastal, a midstream energy company, from May 2002 until February 2005. From November 2006 to June 25, 2007, Mr. Wylie was a private investor. Mr. Wylie currently serves on the board of directors and the Audit Committee of Eagle Bulk Shipping and Coastal Energy, both publicly traded entities.
The company made $3.15 billion in revenues, which was an increase of 78%, after falling -6.66% in 2009. The operating margins in 2010 and 2009 were 8.86% and 11.77%, respectively. The 30-day put/call ratio is 0.9. Share price is down 1.4% since December 17, 2010.
Buckeye Partners owns and operates approximately 5,400 miles of underground pipelines serving ~100 delivery locations. These pipelines transport refined petroleum products including gasoline, jet fuel, diesel fuel, heating oil and kerosene from major supply sources to distribution terminals located in major end-use markets. Our pipelines also transport products such as propane and butane, natural gas liquids, refinery feedstocks and blending components.
Helmerich & Payne (HP) is led by Hans Helmerich as president and CEO, and W.H. Helmerich III as chairman of the board. Hans Helmerich has held his positions since 1989. He has been a director of the company since 1987. Hans Helmerich is a director of Atwood Oceanics, a publicly traded company engaged in the business of international offshore drilling, and Cimarex. He is also a trustee of The Northwestern Mutual Life Insurance Company.
W.H. Helmerich III has been chairman since 1987, and has been a director since 1949. W.H. Helmerich III is the son of company founder, W. H. Helmerich. He joined the company in 1950, served as the president from 1960 to 1987, and was the CEO from 1987 to 1989. He is a former director of Atwood Oceanics, Bank One, Oklahoma N.A., Caterpillar (CAT), Combustion Engineering, Whitman, and previously served as a trustee of The Northwestern Mutual Life Insurance Company.
As of September 2010, the company made $1.87 billion in revenues, which was a decrease of 1%, after declining 7% in 2009. The EBT margins in 2010 and 2009 were 23.37% and 30.4%. The latest quarter ending in December 31, saw revenues increase by 48.7% from Q1 2010. The 30-day put/call ratio is 0.8. HP shares are up 29.9% since December 17, 2010.
The company is primarily engaged in contract drilling of oil and gas wells for exploration and production companies. The contract drilling business accounts for almost all operating revenues, making it one of the major land and offshore platform drilling contractors in the world.
Kinder Morgan (KMP) is led by Richard D. Kinder, who is the chairman and CEO. He receives a salary of $1 a year (no bonuses, stock options or restricted stock grants), and is a past recipient of Morningstar’s CEO of the Year award. Through his leadership, the company has grown from a small company with 175 employees and an enterprise value of $325 million in February 1997 to an organization with ~8,000 employees and an enterprise value of approximately $55 billion today. Kinder Morgan Energy Partners, one of the largest publicly traded pipeline limited partnerships in the US, has delivered a compound annual return of 27% to its unitholders.
In 2010, the company made $8.07 billion in revenues, which was up 15.3%, after falling 40.35% in 2009. The EBT margins in 2010 and 2009 were 16.86% and 19.1%, respectively. The respective returns on assets were 2.05% and 1.7%. The 30-day put/call ratio is 0.6. Share price is up 4.9% since December 17, 2010.
Murphy Oil (MUR) is led by David Wood as CEO, president, and director. He has been president and CEO since January 2009. He was previously executive VP and President of Murphy Exploration & Production from January 2007 to December 2008, and president of Murphy Exploration & Production International from March 2003 to December 2006. William C. Nolan, Jr. is the chairman of the board. He is a partner at Nolan & Alderson, Attorneys, since 1969, and president of Noalmark Broadcasting, engaged in radio broadcasting, since 1973.
The company drew in $23.3 billion in revenues in 2010, which was an increase of 22.79%, after falling 30.9% in 2009. The EBT margins in 2010 and 2009 were 6.06% and 6.7%, respectively. The respective ROEs were 10.27% and 12.3%. The 30-day put/call ratio is 0.5. MUR is up 2.9% since December 17, 2010.
Murphy Oil Corporation is a worldwide oil and gas exploration and production company with refining and marketing operations in the United States and the United Kingdom.
SandRidge (SD) is led by Tom L. Ward, who has served as the chairman and CEO since June 2006, and president since December 2006. Prior to joining SandRidge, he served as president, COO and a director of Chesapeake Energy (CHK) from the time he co-founded the company in 1989 until February 2006. From February 2006 until June 2006, Mr. Ward managed his private investments. He is also a member of the Board of Trustees of Anderson University in Anderson, Indiana and of the Economic Advisory Council of the Federal Reserve Bank of Kansas City.
The company made $774.7 million in revenues in 2010, which was an increase of 70.3%, after falling 50% in 2009. Net income was positive in 2010 due to an income tax benefit of $446 million, however, EBT was - $251.6 million. The 30-day put/call ratio is 0.4. Share price is up 62.75% since December 17, 2010.
On March 1, the board appointed Jim J. Brewer of Amarillo, Texas to the board of directors. Mr. Brewer, a geologist, has almost 30 years in the oil and gas business, and is co-founder and president of J-Brex Company, a private oil and gas and real estate company. He is also the co-founder and currently serves on the board of Energynet.com, a large on-line oil and gas property auction service.
SandRidge Energy is an oil and natural gas company headquartered in Oklahoma City, Oklahoma, with its principal focus on exploration and production. It also owns and operates gas gathering and processing facilities, CO2 treating and transportation facilities, and conduct marketing and tertiary oil recovery operations. In addition, Lariat Services, a wholly-owned subsidiary, owns and operates a drilling rig and related oil field services business. The company focuses its exploration and production activities in the Permian Basin, Mid-Continent, West Texas Overthrust, Cotton Valley Trend in East Texas, Gulf Coast and Gulf of Mexico. We believe Sandridge has undervalued reserves, as we wrote about here.
Schlumberger (SLB) is led by Andrew Gould. He is chairman and CEO. Before assuming his current role in February 2003, Mr. Gould was president and COO of Schlumberger. Prior to that appointment, he held the position of executive VP of Schlumberger Oilfield Services. In a series of earlier assignments, he was treasurer of Schlumberger, and president of Sedco Forex, Wireline & Testing, and Oilfield Services Products. Mr. Gould started his career at Schlumberger in 1975 in the company’s Internal Audit department in Paris. Before joining Schlumberger, he had worked for Ernst & Young.
In 2010, the company made $28.9 billion in revenues, which was an increase of 24.45%, after declining 15.66% in 2009. The EBT margins in 2010 and 2009 were 17.82% and 16.92%, respectively. The respective ROEs were 16.95% and 17.42%. The 30-day put/call ratio is 0.8. Share price is up 12.7% since December 17, 2010.
Schlumberger is the world’s leading oilfield services company supplying technology, information solutions and integrated project management that optimize reservoir performance for customers working in the oil and gas industry. The company manages its business through 33 GeoMarket regions, which are grouped into 4 geographic areas: North America, Latin America, Europe, CIS & Africa and Middle East & Asia.
Suncor (SU) is led by its president and CEO, Richard L. George. He has been in these roles since 1991. He was named “Outstanding CEO of the Year” in 1999 after leading a remarkable business turnaround at Suncor, and received the Canadian Business Leader Award in 2000. Rick served as chairman of the Canadian Council of Chief Executives from 2003 to 2006, and remains on its board of directors. He has been a member of the North American Competitiveness Council since 2006, and was selected to serve as chair of the Canadian contingent of the NACC in 2008. He is also a member of the board of directors of the world’s largest offshore drilling company, Transocean Offshore Deepwater Drilling.
John Ferguson was named to Suncor’s board of directors in November 1995, and was appointed chairman of the Board following the company's 2007 annual meeting. Mr. Ferguson is founder and chairman of the Board of Princeton Developments and Princeton Ventures in Edmonton, Alberta. He is also a Director of Fountain Tire, the Royal Bank of Canada and Strategy Summit.
The company made 3.57 billion CAD ($3.6 billion) in revenues in 2010, which was an increase of 211.6%, after falling 0.19% in 2009. The return on invested capital in 2010 was 10.1%, but was 2.6% in 2009. The 30-day put/call ratio is 0.4. Share price is up 29.3% since December 17, 2010.
The company is an integrated energy company, which is focused on developing Canada’s Athabasca oil sands. On August 1, 2009, the company completed its merger with Petro-Canada. As such, results for the 12 month period ended December 31, 2010 reflect results of post-merger Suncor and the comparative figures for the twelve month period ended December 31, 2009 reflect results for five months of the post-merger Suncor and 8 months of legacy Suncor prior to the merger.
TransCanada (TRP) is led by Russell K. Girling, who is the president and CEO, as of July 1, 2010. Prior to this, he was chief operating officer, responsible for overseeing TransCanada Corporation’s Pipeline and Energy businesses, corporate development activities and strategies, operations and major projects, and corporate services. Prior to serving as COO, Mr. Girling was president of Pipelines of TransCanada, where he had overall responsibility for TransCanada’s regulated businesses, including gas and oil pipelines in Canada, the U.S. and Mexico. Prior to joining TransCanada in 1994, Mr. Girling held several marketing and management positions at Suncor, Northridge Petroleum Marketing and Dome Petroleum. Mr. Girling is currently a Director of Agrium. He is the former chairman of the Interstate Natural Gas Association of America and the Natural Gas Council , and a former director of the Canadian Energy Pipeline Association.
S. Barry Jackson is the chairman of the board since 2002. He was a director of Cordero Energy from 2005 to 2008. He was also a director of ENMAX Corporation from 1999 to 2002 and Gulf Canada Resources Ltd. from 2000 to 2001. He was the chair of Resolute Energy (oil and gas) from 2002 to 2005, and was the chair of Deer Creek Energy (oil and gas) from 2001 to 2005. Mr. Jackson was the president and CEO of Crestar Energy (oil and gas) from 1993 to 2000. He has worked in senior management positions in the oil and gas industry since 1974. He was the chair of the Canadian Association of Petroleum Producers in 1997.
The company made 8.06 billion CAD in revenues in 2010, which was a decrease of 10.06%, after rising by 4% in 2009. The EBT margins in 2010 and 2009 were 21.9% and 20.78%, respectively. The respective ROEs were 7.99% and 9.77%. TRP is up 5.4% since December 17, 2010.
TransCanada is a leader in the responsible development and reliable operation of North American energy infrastructure including natural gas and oil pipelines, power generation and gas storage facilities. TransCanada's network of wholly owned natural gas pipelines extends more than 60,000 kilometres (37,000 miles), tapping into virtually all major gas supply basins in North America. TransCanada is one of the continent's largest providers of gas storage and related services with approximately 380 billion cubic feet of storage capacity. A growing independent power producer, TransCanada owns, or has interests in, over 10,800 megawatts of power generation in Canada and the United States. TransCanada is developing one of North America's largest oil delivery systems.
TransOcean (RIG) is led by Steven L. Newman, who is the president and CEO. Before beginning his current position in March 2010, Mr. Newman served as president and chief COO from mid-2008 to late 2009 and subsequently as President. Mr. Newman’s prior senior management roles included executive VP of Performance, executive VP and COO, SVP of Human Resources, Information Process Solutions, and Treasury, and VP of Performance and Technology. He also has served as regional manager for the Asia and Australia Region and in international field and operations management positions, including Project Engineer, Rig Manager, Division Manager, Region Marketing Manager and Region Operations Manager. He joined the company in 1994 in the Corporate Planning Department.
Robert E. Rose has been chairman of the board of directors since November 2007. Mr. Rose served as president of Taylor Energy Company, a private oil and gas production company based in New Orleans, Louisiana, from March 2008 until March 2009. Mr. Rose was the non-executive chairman of the board of directors of GlobalSantaFe from March 2004, when he retired as an employee of GlobalSantaFe, until November 2007. Mr. Rose served as GlobalSantaFe's executive chairman from 2001 until 2004, prior to which he served as the president and CEO of Global Marine after re-joining Global Marine in 1998 and as Global Marine's chairman from 1999 through 2001. He began his professional career with Global Marine in 1964 and left Global Marine in 1976.
The company made revenues of $9.57 billion in 2010, which was a decrease of 20.6%, after falling 8.8% in 2009. The EBT margins in 2010 and 2009 were 13.5% and 33.96%. The 30-day put/call ratio is 0.7. RIG is up 19% since December 17, 2010.
Transocean is the world’s largest offshore drilling contractor. It helps its clients find and develop oil and natural gas reserves.
Ultra Petroleum (UPL) is led by Michael D. Watford. Since 1999, he has been the chairman, president and CEO. Mr. Watford has enjoyed a full range of industry experiences while working over his 36 year career for a number of energy companies including Shell Oil (RDS.A), Superior Oil, Meridian Oil (Burlington Resources), Torch Energy, and Nuevo Energy. Prior to joining Ultra Petroleum, Mr. Watford was Chief Executive Officer of Nuevo Energy Company for three and one-half years where he led the company’s growth in market value from $200.0 million to over $1.0 billion.
The company made revenues of $979 million in 2010, which was an increase of 46.89%, after plummeting 38.5% in 2009. The EBT margins in 2010 and 2009 were 73.8% and -104.4%. The respective ROEs were 51.98% and -51.88%. The 30-day put/call ratio is 0.7. UPL is down 7.1% since December 17, 2010.
On February 21, the company reported that it had 4.4 Tcfe of total proved crude oil and natural gas reserves at the end of 2010. This is a 13% increase from 3.9 Tcfe as reported at the end of 2009 in leases over 110,000 acres in the Green River Basin of Wyoming and 480,000 over the Marcellus Shale in Pennsylvania. We also think Ultra Petroleum has undervalued natural gas reserves.
Valero (VLO) is led by the chairman of the board, CEO, and president. He is Bill Klesse. Mr. Klesse began his 40 year career in refining as a process engineer with Diamond Shamrock, quickly rising to various managerial positions in engineering, petrochemical feedstocks, planning and development and marketing before being named VP of Logistics and Strategy in 1982. In 1984, he was named director of Corporate Development and, subsequently, executive VP. After the 1996 merger of Ultramar and Diamond Shamrock, forming Ultramar Diamond Shamrock, Klesse served as executive VP of the company’s refining operations. After Valero merged with Ultramar Diamond Shamrock in 2001, Klesse served as executive VP of Refining and Commercial Operations. In 2003, he was named Valero’s executive VP and COO. In 2006, Klesse became CEO, and in 2007, chairman of the board.
Valero made revenues of $82.23 billion in 2010, which was an increase of 20.68%, after falling 42.79% in 2009. The EBT margins in 2010 and 2009 were 1.82% and -0.66%. The respective ROEs were 1.42% and 8.94%. The 30-day put/call ratio is 0.4. VLO is up 26.6% since December 17, 2010.
Valero is a Fortune 500 company based in San Antonio, and is North America’s largest independent petroleum refiner and marketer. Valero supplies fuel and products that improve people’s lives with 14 refineries and 10 ethanol plants stretching from California to Canada to the Caribbean.
Williams (WMB) is led by Alan S. Armstrong, who is the president and CEO. He assumed these positions in January 2011. Previously, he served as president of Midstream and was responsible for leading Williams’ Midstream businesses in Canada and the United States. Previously, Mr. Armstrong served as vice president of Gathering & Processing from 1999-2002; VP of Commercial Development 1998-99; VP of Retail Energy Services from 1997-98 and director of Commercial Operations for Williams Field Services’ Gulf Coast from 1995-97. He joined Williams in 1986 as an engineer. Mr. Armstrong serves as president of the Gas Processors Association and serves on the board of directors of the Natural Gas Supply Association.
Mr. Frank T. MacInnis is the non-executive chairman of the board. Mr. MacInnis has been chairman of the board and CEO of EMCOR (an electrical and mechanical construction company and energy infrastructure service provider) since 1994, after he managed the reorganization and emergence from bankruptcy of its predecessor. Mr. MacInnis is also chairman of the board and CEO of ComNet Communications (a provider of turnkey voice, data, and video infrastructure support). From 1981 to 1984, Mr. MacInnis served as chairman and CEO of HC Price Construction. He has managed construction and operations all over the world, including in Tehran, Baghdad, Bangkok, the United Arab Emirates, London, the US, and Canada.
Williams made revenues of $9.6 billion in 2010, which is an increase of 16.49%, after declining 33.17% in 2009. The EBT margins in 2010 and 2009 were -9.84% and 11.42%. The 30-day put/call ratio is 0.3. WMB is up 26.9% since December 17, 2010.
The company is an integrated natural gas company, which produces, gathers, processes and transports clean-burning natural gas to heat homes and power electric generation across the country. The company operates approximately 14,600 miles of interstate natural gas pipeline, has ~1.2 billion cubic feet per day of natural gas production in the US and abroad, and has 8500 miles of gas gathering lines.
Cloud Peak (CLD) is led by president and CEO, Colin Marshall. Before his appointment as head of Cloud Peak Energy, Mr. Marshall was president and CEO of Rio Tinto Energy America (RTEA) prior to the company’s public offering as Cloud Peak Energy (CLD). Preceding RTEA, Mr. Marshall was the general manager of Rio Tinto’s (RIO) West Pilbara iron ore operations. He was located in Tom Price, West Australia, where he managed four iron ore mines. Mr. Marshall began his career with the Rio Tinto group in 1987 as a Graduate Trainee. He then worked for Rio Tinto plc in London as an analyst in the Business Evaluation Department before moving to Brisbane in 1996 as finance director of Pacific Coal. In 2000 he was appointed general manager of Rio Tinto Energy America’s Cordero Rojo mine in Wyoming. He served in that role until March 2004 when he moved to Tom Price.
Keith Bailey is the chairman of the board. He has served in this capacity since September 2009. In 2002, Mr. Bailey retired from serving as the chairman of the board of directors of Williams Companies, a natural gas company, a position he held since 1994. Mr. Bailey also served as the president and CEO of Williams Companies from 1994 to 2001. Mr. Bailey is a member of the board of directors of Integrys Energy, a natural gas and electric utility company, APCO Oil & Gas and Markwest Energy, a natural gas gathering and processing company.
Cloud Peak generated $1.37 billion in revenues in 2010, which was a decrease of 1.96%, after rising 12.78% in 2009. The EBT margins in 2010 and 2009 were 15.46% and 18.2%. The respective ROEs were 8.6% and 150.9%. The 30-day put/call ratio is 0.5. Share price is up 1.6% since December 17, 2010.
Cloud Peak Energy is the third-largest U.S. coal producer and the only pure-play Powder River Basin coal company.
Pride (PDE) is led by Louis Raspino, who is the president and CEO. He took these positions and also became a director in June 2005. Mr. Raspino joined the company in December 2003 as executive VP and CFO. From July 2001 until December 2003, he served as SVP of Finance and CFO of Grant Prideco. From February 1999 until December 2000, he served as VP of Finance for Halliburton (HAL). From October 1997 until July 1998, he was a SVP at Burlington Resources. From 1978 until its merger with Burlington Resources in 1997, he held a variety of increasingly responsible positions at Louisiana Land and Exploration Company, including as SVP, Finance and Administration and CFO. Mr. Raspino also is a director of Dresser-Rand Group and the Memorial Hermann Healthcare System.
David A. B. Brown became chairman of the board in May 2005 and became a director in September 2001 in connection with our acquisition of Marine Drilling Companies. Mr. Brown was a director of Marine from June 1995 until September 2001. Mr. Brown is currently chairman of the board of Layne Christensen. Mr. Brown served as president of the Windsor Group, a strategy consulting firm, from 1984 until 2005. Mr. Brown was chairman of the board of the Comstock Group from 1988 to 1990. Mr. Brown is also a director of EMCOR. Mr. Brown served as a director of NS Group from 2001 to 2006 and of Petrohawk Energy (HK) from 2006 to 2007.
Pride International made $1.46 billion in revenues in 2010, which was a decrease of 8.4%, after also falling in 2009 by 31%. The EBT margin in 2010 and 2009 was 17.26% and 25.85%. The respective ROEs were 4.99% and 6.6%. The 30-day put/call ratio is 0.3. PDE shares are up 32.2% since December 17, 2010.
Headquartered in Houston, Texas, Pride International is one of the world's largest offshore drilling contractors. The company provides contract drilling and related services to oil and gas companies worldwide. With approximately 4,000 employees, Pride offers a multinational workforce with offices in the US, Angola, Brazil, and Saudi Arabia. We have positioned our fleet in some of the world's largest and most active exploration and production basins.
Tidewater (TDW) is led by Dean Taylor, who is the president, chairman and CEO. Mr. Taylor started as an assistant manager for Tidewater in June 1978 in Morgan City, Louisiana, assisting with operations in the Gulf of Mexico. He was promoted to general manager of Tidewater’s business activities in Italy in 1979, and remained there until 1981. From Italy, he was transferred to become general manager of Tidewater’s business activities in Brazil in 1981 and remained in that position until 1985. Mr. Taylor was promoted to regional manager of Tidewater’s business activities in the Middle East, India and East Africa in 1985 and remained in that position until 1986, at which time he assumed responsibility for Tidewater’s joint ventures and businesses in Mexico. He assumed responsibility for Tidewater’s business activities in Venezuela as well in 1992, and was promoted to corporate VP in 1993.
In 1995, he assumed responsibility for all Tidewater business activities in the Americas south of the Rio Grande, including the Caribbean. He was promoted to executive VP in December 2000 with continuing operations responsibilities in Brazil, Mexico, Trinidad, Venezuela, Angola, West Africa, Nigeria and the North Sea, and he also oversaw the coordination of all international sales activities. In October 2001, Mr. Taylor was appointed president and immediately began overseeing every aspect of Tidewater’s worldwide operations. He assumed the position of CEO from former chairman and CEO William C. O’Malley in March 2002, and also was made chairman in July 2003. He has served as a director for Whitney Holding Corporation since 2002 and for the American Bureau of Shipping (ABS) since 2003. He has been a member of Tidewater’s board since 2001.
For the 12 months through December 2010, the company has made $1.06 billion in revenues. The EBT margin was 17.17% with a ROE of 6.11%. In FY 2010 that ended in March, the EBT margin and ROE were 22.91% and 11%, respectively. The 30-day put/call ratio is 1.2. TDW is up 22.25% since December 17, 2010.
Tidewater has a fleet of more than 350 vessels, and is oldest, largest and most experienced provider of the marine support services for the “work boat” industry. Tidewater has a global footprint, with over 90% of its fleet working internationally in more than 60 countries.
Disclosure: I am long SD.