Husky boss may step down in 2005

Gary Park

Petroleum News Calgary correspondent

It’s been a tough road, with the rival pack snapping and snarling from the sidelines, but John Lau has turned Husky Energy from a mongrel to a dog that has bite.

When he surfaced in the Canadian oil patch 10 years ago as the chosen appointee of Li Ka-shing, the Hong Kong tycoon who seized control of the floundering company, Lau was not well received in the clannish industry.

He quickly developed a reputation as a tough taskmaster, who did not hesitate to ruffle feathers in a company formed in 1938, giving ammunition to the naysayers who dismissed him as a man with little knowledge of the industry.

Lau even admitted in a Financial Post interview that he got little backing from Husky management as he tried to turn the company around, saying he was viewed “as a stranger and an intruder.”

But, under his stewardship, Husky has been transformed from a private company to a publicly traded enterprise, albeit one that remains 71 percent controlled by Li and his family.

Since Lau’s arrival, Husky has seen its bottom line move from a C$250 million loss in 1993 to a C$1.3 billion profit in 2003, its production climb from 97,000 barrels of oil equivalent per day to 312,500 boe and its reach expand from Alberta’s heavy oil region to Canada’s East Coast and the South China Sea, all amid a welter of speculation that it was ripe for takeover by any one of several firms, including PetroChina, Total, ConocoPhillips and Canadian Natural Resources.

Lau told shareholders at the annual meeting that the goal is now 500,000 boe per day by 2008.

He also startled investors by announcing he will likely leave Husky in 2005, once its 92,000 barrel-per-day White Rose field offshore Newfoundland is completed.

Although there is no formal retirement date, Lau said he wants to “make sure my baby’s growing up,” referring to White Rose.

Canning Fok, who is Husky’s co-chairman with Li’s son Victor, said Lau has had “10 excellent years” at the company, creating a core asset that the majority owners have no desire to sell.