On his first day on the job, Doug Suttles said he intends to gain a solid understanding of Encana's assets and people before laying out his vision for the company, which has been beset by a weak natural gas market for several years.
"I want to do this once and I want to do it right," said Suttles, a 30-year veteran of the industry who most recently was chief operating officer at BP Exploration and Production.
"So I hope you can appreciate that it will take some time before I will be in a position to articulate a clear and concise vision for Encana."
Although North American natural gas prices have been firming up recently, Suttles has a conservative outlook for the sector.
"My personal outlook is we're going to be in a modest price environment for some time," he said.
"Clearly I hope it improves, but I think the way you should run the business is assuming modest prices."
Since spinning off its oil and refinery business into Cenovus Energy Inc. (TSX:CVE) in 2009, Encana has been focused more-or-less exclusively on natural gas. Advances in drilling techniques — many of which Encana pioneered — have unlocked vast amounts of gas across the continent, leading to a supply glut that has depressed prices.
In recent years, Encana has had to back off of aggressive growth plans, instead focusing on driving down costs, shedding non-core assets and inking joint-venture deals with deep-pocketed international partners, such as PetroChina and Mitsubishi.
At BP, Suttles led the cleanup of the massive oil spill in the Gulf of Mexico, triggered by the blowout of the Macondo well in April 2010. Some 757 million litres of oil spewed into the deep waters off the Louisiana coast.
Suttles left BP in early 2011 after 22 years at the company, and has served on corporate boards and done some consulting work in the intervening years.
"You can't go through deeply challenging events without learning a lot," said Suttles.
"Leadership matters a lot and being able to lead people and help them go in the right direction is so important."
Clayton Woitas, who had been filling in as Encana's CEO on an interim basis since Randy Eresman's abrupt departure from the top job in January, said the board of directors looked at more than 100 candidates.
"Recognizing the challenges and opportunities in front of the company, we knew that we needed someone with a strong track record of success, someone who is a front line leader, someone with exceptional communication skills and someone who can develop a clear, consistent strategy for the company," he said.
"When I first met Doug, I immediately noticed that he was articulate, confident and charismatic. This is exactly what Encana needs in a leader."
Woitas said Encana considered Suttles' experience handling the BP spill aftermath an asset.
"I know that some of my best learnings from my career came from difficult situations," said Woitas.
Suttles will also join the board as a director, while Woitas has been designated as the board's next chairman to replace David O'Brien, who is retiring.
Woitas said in April, after Encana's annual meeting, that there were three internal candidates for the top executive job, including chief financial officer Sherri Brillon.
First Asset Investment Management portfolio manager John Stephenson said he's pleased Encana brought in its new CEO from outside the company, as the Calgary oilpatch "needs to be shaken up a little bit."
"I think it's important that he's an outsider. I think it's important that they didn't go to the bench."
Suttles "ticks all of the boxes," as far as Stephenson is concerned. He has experience around the world and working in joint ventures. He also appears to be a realist.
"And if he's charismatic and people kind of love hearing him speak and he paints a great vision for the company and employees fall in line, even better."
Woitas said he wouldn't expect to see Suttles start delivering results for another "12 to 24 months."
Stephenson said he believes shareholders will be patient, too.
"I think they'll give him a year — maybe it will be longer. A good year he should be able to show some significant change, maybe not get all the way along."
Suttles — whose family is deeply rooted in West Texas and the energy business — trained as a mechanical engineer at the University of Texas in Austin where he graduated in 1983.
From 1983 to 1988 he had assignments at Exxon before joining BP.
His positions at the British oil giant included vice-president for North Sea operations, and he has also been president of BP Sakhalin Inc. in Russia and president of BP Alaska.
"Coming to Calgary is not my first chance to get cold," he said.
Encana shares closed down 37 cents at $18.54 on the Toronto Stock Exchange.Suggest a correction