CRESCENT POINT ENERGY
Investors know Crescent Point Energy as a significant oil producer. The company has a market capitalization of more than $10 billion, 165,000 boe/d of production and almost a billion barrels of proved and probable oil reserves. That is a big company.
Considering how large Crescent Point is today, it’s hard to believe that it didn’t even exist at the turn of the century—yet another story of an entrepreneurial management team building something out of nothing. Crescent Point’s CEO Scott Saxberg was an engineer for junior producer Wascana Energy when the 21st century rolled around. In 2001, Saxberg joined a leadership group that was ready to strike out on its own.
The name Crescent Point came from the road to Saxberg’s family cottage. The business strategy of focusing on oil was a contrarian one at a time when the majors were snatching up gas-weighted assets, believing a shortage was coming. Boy, were they wrong. As the major producers bought companies for their gas assets, they dumped the oil properties. That meant opportunity for Saxberg and his crew.
Embracing the horizontal drilling revolution and moving quickly into emerging unconventional plays like the Saskatchewan Bakken, Saxberg created an acquisition-focused business model for Crescent Point. By keeping a very conservative balance sheet, aggressive hedging and significant dividend, Crescent Point became very attractive to investors, and as a result has historically had a premium market valuation.
Keeping a top quality balance sheet didn’t just allow Crescent Point to build a sizeable business. It has also allowed the company to weather an oil price collapse that very few thought could last this long. While other higher decline unconventional producers have disappeared, Crescent Point has been able to cut its dividend and hunker down.
Today, Saxberg and Crescent Point have a huge portfolio of light oil drilling locations across the Bakken, Shaunovan, Unita and Viking plays. The next act for Saxberg, once oil prices recover, is likely to be secondary recovery through water-flooding, which can increase recoveries by 200 to 300 percent.
CRESCENT POINT CEO SCOTT SAXBERG