June 2008 IssuE
The Summit Series
Bumpy Journey Pays Off
Clayton Riddell, P.Geol., drilled where others feared to drill, while he was at it developing a new way to get at shallow natural gas. Today, it’s no exaggeration to call this professional geologist and 2008 Centennial Leadership Summit Award winner an industry giant.
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SUMMIT GALA TRUMPS HOCKEY |
Editor’s Note: Beginning in this edition, The PEGG is running a series of stories on the 2008 Summit Awards winners.
BY FRANCINE MAXWELL
The PEGG
Clayton Riddell, P.Geol., grew up in Manitoba thinking he wanted to drive trains for a living. Then he discovered geology.
He has since become an engine of the oil and gas industry in Alberta and one of the most successful people in Canada. The chairman and CEO of Paramount Resources and the creator of Paramount Energy Trust, Trilogy Energy Trust and most recently MGM Energy Corporation, Mr. Riddell has built a reputation for success from, among other things, developing a new way to drill for natural gas.
That high standing and his continued successes have now garnered him APEGGA’s Centennial Leadership Summit Award, the most prestigious of the awards presented each April.
Despite the bumps along the way, Mr. Riddell says he wouldn’t change a thing about how he got where he is. The bumps, he says, made the journey interesting.
“I’d do the same thing all over again. I spent summers climbing mountains and being outdoors. [For the new geologists] the mapping has all been done, which is unfortunate for them. But I had a great time,” says Mr. Riddell.
He spent his summers scrambling over mountains and across crags and canyons to survey and map uncharted areas, building a unique understanding of geology. Mapping the better portion of the mountains from Jasper Park to the Arctic Ocean, Mr. Riddell gained knowledge that would prove invaluable throughout his career.
Bucking Common Wisdom
By the late 1970s, Mr. Riddell had also amassed a fair chunk of northeastern Alberta real estate. These were tracts of land others believed were more hassle that they were worth when it came to drilling for anything.
Mr. Riddell didn’t buy into the common wisdom. Thinking there was great potential for natural gas in the tracts, Mr. Riddell went ahead with his plans. There was one hitch — no pipeline serviced the areas he had drilled.
“No one else had gone in there. We’d mapped where the gas was and figured out how to get it out of the formation. We built the company on drilling where there was no competition,” says Mr. Riddell.
Mr. Riddell persevered and eventually discovered a wealth of natural gas. “We were truly wildcat drilling. We were drilling where no one else was, which meant no competition. Others thought we were crazy at the time, but as it turned out, we were right.”
In the space of a weekend, I nearly lost everything and got it
all back.
- Clayton Riddell, P.Geol.
The Line That Clay Built
The reserves Mr. Riddell found were large enough that NOVA Corp., now TransCanada Pipelines, extended its transportation system to the area in 1982. The Liege Lateral, a major undertaking, became known as “the line that Clay built.”
To get the natural gas out from the shallow wells — no small feat in itself — Mr. Riddell and company perfected an air drilling method destined to become the way things are done. This method uses compressed air as its circulation medium rather than water or drilling mud. Not only was it innovative, it caught on throughout the industry and was considered to be as efficient as or more efficient than traditional methods of drilling for shallow gas.
It wasn’t always smooth sailing for the future Forbes Fortune 500 listee. There was a time when everything Mr. Riddell worked for was perilously close to crumbling before his eyes.
“After we’d found all the gas, I had ordered nine compressors that we needed. We had no money but I ordered them anyway. They cost $1.5 million each. The day before they were to arrive, I got a call saying that the gas was going to be a year later going onstream. I had no way of paying for the compressors.
“This was a Friday afternoon. That weekend, Syncrude had a big fire and needed the exact same compressors I had coming in. I agreed to sell them five of the nine I’d ordered. For somewhat more than they cost me to buy.
“So in the space of a weekend, I nearly lost everything and got it all back.”
Hospitality, Horses and Hockey
Business overall has been very good to Mr. Riddell. So good, in fact, that he dabbles in a wide variety of extra-curricular activities. He has investments in several of Calgary’s elite restaurants and he raises thoroughbred horses on his sprawling ranch south of Calgary.
To complete the Cowtown tri-fecta of hospitality, horses and hockey, he’s also a part owner of the Calgary Flames NHL team.
“I’d done well in business and in 2003 the Flames were struggling financially and looking for someone to help carry the financial load. So I stepped up and joined the group that kept the team in Calgary.
“As luck would have it, the team began performing very well the following year.” In 2004, Calgary Flames came within one game of winning the Stanley Cup.
Payback Time
He’s a philanthropist, too. According to CSPG Reservoir magazine, Mr. Riddell says he got a lot out of being a geologist and believes everyone should give back. Most recently, Mr. Riddell donated $10 million to his alma mater, the University of Manitoba.
The school has named the faculty of environment, earth and resources after him as a thank you. Yet Mr. Riddell underplays his donation. “All I did was give them support to make (the faculty) better.”
Other charitable works include donations to Calgary’s Potential Place, the United Way, Ronald McDonald House and the Alberta Children’s Hospital, and fundraising initiatives for the Calgary Flames Charity Foundation and Between Friends.
There’s play, of course. Mr. Riddell enjoys golfing and adores raising racehorses. Still, his passion for geoscience remains as strong as ever.
With successes like his, many in his shoes would be considering retirement. But Mr. Riddell has more to do, it seems.
He recently created Paxton Corporation. Paxton is using a patented U.S. technology to create a zero-emissions horizontal rocket for producing electricity — and a stream of carbon dioxide that can be captured and sold.
Apparently, he’s not done being a pioneer just yet.