Cenovus goes local with new CEO
It’s official. Alex Pourbaix, the former chief operating officer at TransCanada Corp., where he worked for 27 years, has failed at retirement.
Pourbaix, who left TransCanada earlier this year, will replace retiring Cenovus chief executive Brian Ferguson, effective next Monday, the company announced.
Other names rumoured to be in the running included ARC Financial vice-chairman Chris Seasons, the former president of Devon Canada, and Lorraine Mitchelmore, the former country chair for Shell Canada and now president and CEO of Field Upgrading.
Pourbaix takes over a company that has been under scrutiny since paying $17.7 billion for ConocoPhillips assets last March. Investors were unhappy with the deal, which beyond the steep price also included deep basin natural gas assets, which meant Cenovus was no longer a pure play on the oilsands.
Ferguson took the fall for the deal, announcing at the company’s investor day in June that he would retire at the end of October. However, some feel the company’s board of directors hasn’t taken its share of responsibility for the transaction. The board, which functions as the final check and balance, approved that deal.
Pourbaix, like Ferguson, is a graduate of the University of Alberta but is not an engineer. He lacks operating experience and doesn’t come from the exploration and production side of the oilpatch.
Some say that means he can’t call “B.S.” as easily since he’ll be relying on others to do the risk assessment on the company’s portfolio and how best to allocate capital. It helps, as they say, if you speak the same lingo.
But it’s not like Pourbaix doesn’t know how to lead a team, oversee complex projects and create value.
At TransCanada, he held the position of president, energy & oil pipelines and oversaw the Keystone XL and Energy East pipeline projects. He’s therefore been in the eye of storms that had many similarities to what oil and gas companies deal with, whether that’s environmental-, stakeholder- or governmentrelated issues.
Pourbaix was also integral to TransCanada’s acquisition of the Columbia Pipeline Group in 2016, not to mention the company’s growth in the power generating sector.
In other words, he is very familiar with large, complex and controversial projects. More important, say those who know him, is his energy and ability to inspire those who work with and for him. The U of A law grad is considered a strong leader and unconventional thinker. He also belongs to a unique oilpatch club that isn’t very big; Pourbaix can communicate.
Whether it was dealing with sell-side analysts, conferences or anti-pipeline opponents, Pourbaix was measured, clear and earnest in his responses at TransCanada.
Reached Monday in London, where he is celebrating his 25th wedding anniversary, Pourbaix said he was excited about the new position and the potential offered by Cenovus’s asset base.
“More than anything, when I look at Cenovus, it’s a great Alberta company, it has great assets,” he said. “I’m excited about the challenge of making this company the best it can be.
“There’s an incredible valuecreation opportunity ... an opportunity to show that not only does it have great assets, it has great operations, great employees and can deliver great returns to shareholders.”
On that, Pourbaix was very clear that he is committed to meeting with shareholders to understand their views and expectations of Cenovus and the management team.
Being in a higher-cost basin and far from markets means Pourbaix’s remarks translate into one thing: competitiveness and cost control.
“We have to show we have to be competitive with all other sources of oil and gas on the planet and so a big focus for Cenovus going forward is cost competitiveness,” he said.
The flip side is that Pourbaix inherits the strategy of the company’s previous leadership and will be challenged with making the acquisition of the deep basin assets work for Cenovus and its investors.
As someone who has made his career on the downstream side of the business, Pourbaix will also bring a unique perspective to the issue of market access. Where he was once in the business of providing it to customers, he is now on the side of needing it.
“Market access is important for the industry and I do think this is an area where I bring depth and experience and certainly hardbitten scars ... hopefully I can bring a helpful perspective to that whole debate,” Pourbaix said Monday.
By choosing Pourbaix, the Cenovus board has put its confidence in someone who is widely viewed as a smart, strong leader — an outsider with the necessary credibility who understands regulatory complexity and stakeholder relations, can build consensus within an organization and is a good communicator.
He built a great career on the downstream side of the oilpatch and expectations are high he’ll do the same in the upstream.
For Pourbaix, the response to that view is simple — challenge accepted.
University of Alberta law graduate Alex Pourbaix is considered a strong leader and unconventional thinker. He replaces retiring Cenovus boss Brian Ferguson.