Untamed imagination and irrepressible optimism

December 25th, 2006
Email This Post  Print This Post  

From the op-ed pages of the Calgary Herald, Wednesday, December 20, 2006 (this is the original, slightly longer version):

Julio Poscente was among the last of Calgary’s old-style oil finders. His handshake was better than a lawyered contract, and he was loyal to a fault. Following a business life that included major discoveries, numerous deals and, as so often in this volatile industry, a financial disaster, he kept hunting the big pools nearly to the day he died.

Jules, as everyone knew him, passed away Friday two weeks ago, having turned 78 in mid-November. Commanding, witty, enthusiastic, courtly, imaginative, energetic and deeply personable, a family man and musician as well as oilman, Poscente left an impact on everyone he met.

The oil industry’s colourful metaphors were written for him: he was a wildcatter, an elephant-hunter, a buccaneer. He was all about the big play, the one huge strike.

Today’s almost pathologically timid industry, where “management teams” mutter about “risk profiles” and “human resources”, seemed like a foreign planet. Today’s oilperson might reply that Poscente was himself a dinosaur. Yet even into his 70s he proved adaptable, adjusting plans to changing politics and technology.

After early jobs at several companies, the Trail, B.C. native’s first business life was as the land man and later head of Canada North West Land (later Energy). Although a minnow among sharks, Poscente soon began bidding on a prospective block offshore Spain.

After the Spanish government dismissed his outfit as too small, Poscente back home did a quick deal to gain a vast area of remote (and nearly worthless) Arctic ice. Now he was “big” – and Spain awarded him the play. Partnering with Chevron, Poscente hit the mythical gusher in 1978. The massive field was named Casablanca, and is still producing.

The Vega discovery off Sicily followed. The wildcat well topped 10,000 barrels per day – 100 times the typical rate in Alberta today. Northwest’s stock zoomed. But when oil prices dropped, Poscente’s bankers called his loan – literally shoving a letter under his door – and Northwest went bankrupt.

No matter what he was doing, Poscente always had fun. The people he collected stuck around for decades: childhood friend Jimmy Kirker, Ned Goodman of Dundee Securities, Jaffar Khan, Sam Ingram, Derek Buntain and many others.

Like many accomplished people in post-National Energy Program Alberta, Poscente became an early supporter of the Reform Party. He remained active throughout the Reform-Alliance-merged-Conservative movement. Poscente could talk politics for hours, and always saw the humour.

Of course Poscente couldn’t stay retired. “He got tired of mowing the lawn, headed off to Russia to find some prospects and called up Ned Goodman, who said ‘I’m in’,” recalls Bruce Sherley, another good friend and executive vice president at Eurogas Corp., which Poscente founded in the early 90s.

Eurogas was a reflection of Poscente’s untamed imagination and irrepressible optimism. His tiny band, including his son Lee, roamed the globe looking for elephant-sized prospects – Siberia, offshore Spain, Tunisia.

Although the Tunisian exploration came up dry, two years ago Poscente drilled into a long-abandoned formation off Spain – hitting a gusher that would shame anything in western Canada. Poscente aimed to convert this vast reservoir into Europe’s largest underground natural gas storage facility. He spent years delicately navigating the swamps of Euro-bureaucracy.

Perhaps his most artful manoeuvre was exiting Russia. Eurogas held 50% of the Yuro-Yakinsk field, a billion-barrel dome of natural gas and condensate. But the Russian gas pipeline giant refused to build the needed 12-km lateral pipeline unless it could grab the field for itself.

In a country where Western businessmen are routinely shaken down, expropriated, threatened, accused of trumped-up infractions, kidnapped or murdered, Poscente negotiated a sale to the then-giant concern Yukos. Eurogas got US$18 million in cash. This was high-stakes risk management performed by an instinctive risk-taker.

A clause in the sales contract required Yukos to pay another US$3 million if it later purchased the field’s other half. When it did so, Yukos first failed to inform Eurogas, then wouldn’t pay. Instead it invited Poscente to Moscow to “discuss” the situation. He wouldn’t have been the first Western businessman found floating in the Neva River, so Poscente insisted on meeting in London. Having gone to the mat to protect his shareholders’ capital, he returned with nearly the entire sum.

Last year Poscente retired, and Khan became Eurogas’ CEO. Poscente remained a director, and was active until barely two weeks before his death. He spent only days in a hospice before passing away. Poscente leaves his wife of 55 years, Maureen, their sons Kai, Jay and Lee, brother Dante, sister Eleanor, and six grandchildren.

Blogmarks BlogLines del.icio.us Digg Facebook Google Google Reader Magnolia Yahoo! MyWeb Newsgator reddit SlashDot StumbleUpon Technorati