Eric Newell is in a Vancouver hotel room en route to Hawaii for a two-week vacation with his wife and friends. He ought to be contemplating which umbrella drink to try first on the beach.

But the retiring CEO of Syncrude Canada isn’t on the phone pitching Hawaiian sands. Six weeks shy of his last day of work, he’s still more interested in the oilsands that have highlighted a distinguished 34-year career in the energy industry.

And you get the feeling Newell’s unbridled passion for the massive Syncrude Project operated by Syncrude Canada won’t diminish much, even when he hands successor Charles Ruigrot the keys to the corner office in Fort McMurray on December 15.

1. To what career did you aspire as a youngster?

File photo by Mike Sturk, Business Edge
Retiring Syncrude CEO Eric Newell remains the organization’s head cheerleader.

“I wanted to be a major league baseball player. I was playing in the men’s league by the time I was 15, but as I was going into university, I was trying to make up my mind if I wanted to be a chartered accountant or a lawyer. I had an American uncle who taught at the University of Washington. He was one of these abrupt talkers. He said: ‘What are you interested in?’ I said: ‘Chartered accountancy or law.’ He said: ‘Then you don’t have a choice.’ I said: ‘Which is it?’ He said: ‘Engineering.’ ”

2. Was your father (Patrick Newell) a president or CEO?

“My dad was at the Royal Bank in Victoria for 45 years. He was the manager of the foreign exchange department and he had held that position for the last 28 years of his career. He was one of 12 kids growing up in the Depression, and he had a different outlook on the world than me when it came to moving (up) in a career. It seemed like I was moving every year early in my career. Once my dad got a house, he told the Royal Bank he never wanted to move again. In many ways, I owe a lot to my father and I don’t think there was anyone I ever respected more. He was the kindest, gentlest man I ever knew.”

3. What was your first job?

“It was in London with a consulting company called Cremer & Warner, the firm that pulled together the work that led to the cleanup of the River Thames. My boss (Sir Frederick Warner) was actually knighted for his work with that project. He was really a good first boss. He really challenged you and you got to do a lot of things.”

4. Who has had the greatest influence on your career in the energy industry?

“I think one who stands out was Gord Thompson (former president of Imperial Oil Canada). I’m pretty sure he was the one who put my name forward and promoted the fact that I should go out to Syncrude on loan in 1986, which led to me becoming CEO of Syncrude Canada.”

5. To what do you attribute your success in the energy industry?

“First of all, I have to give a lot of credit to Imperial Oil because they put a lot of effort into management development. I was always ambitious, worked hard and wanted to take on new challenges. But you have to have those opportunities come forward and I had many opportunities that I could aspire to, such as the Syncrude Canada opportunity.”

6. Why did you leave Imperial Oil to join Syncrude Canada?

“I liked the excitement of being involved in something that was growing with huge potential, like the oilsands. Working on the refining side of the business with Imperial Oil, a lot of the challenge in those days was shutting units down because the demand for products was falling. Don’t get me wrong. I enjoyed my time with Imperial Oil, but Syncrude was a unique opportunity.”

7. What do you remember about the challenges in your early years with Syncrude?

“The challenge was to create a new vision for energy in Canada because nothing had been done in the oilsands for a long time. We created the National Oil Sands Task Force, bringing together about 35 organizations and about 70 people. I used to call it the mother of all collaboratives. I think one of the tricks was to learn how to describe what success looked like and put it into terms that were meaningful to our key stakeholders. We were able to put together a very compelling case and, because it involved all the stakeholders, people got excited. I think one of the keys was understanding that there were a lot of stakeholders and you had to develop a case that made sense to all the stakeholders. If you’re arguing in terms of self-interests in a project like this, you’re not going to get very far.”

8. Are you content with what you’ve accomplished as you prepare to give way to your successor, Charles Ruigrot?

“I’m very proud of what Syncrude has accomplished and in my very small role in that as the longest-standing CEO (14 years). This is Syncrude’s 25th year of operation and when it was started up in 1978, the original plan was to operate for 25 years, produce about one billion barrels, contribute about $1 billion of royalty revenue to the province and then just shut it down. As I leave, we’re in our 25th year, we produced our billionth barrel by 1998, and it has paid over $3 billion in royalties to the Alberta government. But the really good news is that we now have the vision, the leases and the technology that will enable us to double our production over the current ($50-billion) expansion program and go for another 30 or 40 years. I think Syncrude has a very bright future. The analogy I like to use is that it’s like running a long relay race and it was just time for me to pass the baton to Charles and the rest of the executive team to take Syncrude to bigger and better heights. As a retiree, I’m going to be their No. 1 cheerleader.”

9. What’s your proudest achievement with Syncrude Canada?

“Well, I’d like to name three, if you’d allow me that. During my tenure as CEO, we shipped over a billion barrels (of sweet-blend crude oil), and Syncrude’s total is 1.4 billion barrels. There aren’t many oilfields in the world that produce a billion barrels. Secondly, I’m proud of the success of the National Oil Sands Task Force that has led to this $50-billion-plus expenditure that is going to occur. I think we also developed a well-earned reputation as a socially and environmentally responsible corporate citizen. I think we did a good job of managing the triple bottom line.”

10. What’s your best advice for Charles?

“He’s got a real championship management team that wants to work with him, so I’d advise him to work closely with his executive team. Together, I know they can go on to greater and newer heights. I also think it’s important that we pay attention to our broader role in the community. It’s probably the only place (in the industry) where the CEO actually resides in the community (Fort McMurray) where the main operations are. We play a huge role in that community so, as leader of that, Charles carries quite a responsibility.” 11. What do you foresee as Syncrude’s most daunting challenge?

“Unquestionably, the major priority right now is the construction of the $5.7-billion Stage 3 investment. The mining part of it is in startup, it has been an outstanding project and it was a $700-million project that came in within three per cent of the approved project and started up within two weeks of the original schedule. We hear about all the over-runs and the unsuccessful (projects), but you don’t hear much about the ones that come in on schedule and on budget. The real major challenge is the $5-billion upgrader expansion and that’s just a huge project.”

12. What’s the key to meeting that challenge?

“The major challenge is to have a safe and orderly construction and smooth commissioning and startup of that project.”

“And, of course, it’s also important to contain the costs. Once these projects get up over a couple of billion dollars, and I’m talking as an industry, we have trouble getting our hands around them and bringing them in on budget. The challenge is to contain the costs and start it up safely. Then we’ll have a platform for future growth that will be terrific.”

13. Any regrets?

“I don’t have many regrets. I’ve been very blessed with the support I’ve received from my wife and children. I’ve had quite a hectic schedule, so my family has made a lot of sacrifices for me. So, now that I’m at a point where I have three grandchildren, I probably would like to have spent more time with my kids when they were growing up. But I betcha if you asked any successful executive, he’d probably say the same thing.”

14. What’s the most important lesson you’ve learned in business?

“I think one of the keys is learning who your key stakeholders are, and trying to understand where they’re coming from. Seek first to understand and then to be understood. Then, the key is not to focus on the differences. Find out where the common ground is and build from there.”

15. What’s your best advice for a budding young executive?

“If you’re going to be a CEO, I think there are three keys to success. First, you have to be able to articulate and develop a shared vision that’s quite motivational, because people don’t get excited just by profit numbers. They’ve got to know where you’re going long term, and buy into that.

"That’s a real communication challenge. You’ve got to have really good communication skills, and one of the best skills is listening and not just talking. But just having a vision won’t make you successful. You have to realize that the more senior you get, the more you have to work through people and make sure they’re motivated. You’ve got to have reward systems lined up. The third thing is that you have to provide for the future. That’s why at Syncrude we’ve played such a strong role in promoting careers in trades, technologies and engineering.”

16. At what point did you make the decision to retire?

“I really started to explore this with the CEOs of the owner companies in June. It’s been very well thought through. One of the absolute key people here is Jim Carter (president and chief operating officer). I owe him a lot for staying on. That was absolutely fundamental. Charles is familiar with our vision, values and culture, but there won’t be any other changes on the executive team. My wife (Kathy) always said: ‘You’ve got to retire before you’re 60.’ Well, the day after my last day at work (December 15), I turn 59.”

17. So what’s it going to feel like to walk out the door on your final day?

“I have to be honest – I’m going to miss it like crazy. We have an outstanding management team and I’ve got so many friends amongst all of the Syncrude employees and I’m also going to miss the (Fort McMurray) community because my wife and I are moving to Edmonton. I don’t think it’s right that a retiring CEO stays in town when the new one comes in. Syncrude’s too big a part of the community.”

18. Will you continue to chair the Careers – The Next Generation program that you founded?

“Yes, that’s my baby. I love it and I’ll still definitely continue doing that. We run career workshops, promoting careers in the trades and technology areas to our youth, and bring employers to the table with their chequebooks to create the workplace opportunities. I’ve also had very strong ties with the University of Alberta, having chaired the board for four years. I have a feeling that I’m going to get some offers along those lines. But we don’t want to take on so much so that we can’t enjoy the fruits of retirement. I’ve had to limit myself to being on one board (Canfor Corporation) so I’ve never been able to be involved in international oil and gas and other areas where I think I might be able to contribute something and learn a lot. I’ve also got time now to devote to things like building business education partnerships. And I look forward to doing things as a family.”

19. Do you do a lot of investing outside of your industry?

“Sure, with my father being a banker for 45 years, some of that has got to rub off on you. I’ve always been good at saving money and investing it. I’m not a high-risk venturer.

20. How do you think you’ll cope with retirement?

“I think it’s going to be a bit of a challenge for me and I’ll be going through some withdrawal pains. But the one thing I’m not going to do is just stop dead. I’ve got to keep going. The key for me is to understand this is a difficult change in my life, but not to take on so much that I’ll be busier than I was before.”

IN PROFILE: ERIC NEWELL
* Born/raised/age: Kamloops, B.C.; Victoria, B.C.; 58.
* Title: CEO, Syncrude Canada.
* Education: Master of science in management studies, University of Birmingham; bachelor of applied sciences in chemical engineering, University of British Columbia.
* Family: Wife Kathy, three children.
* Career: Newell has been CEO of Syncrude Canada since 1989 when he was promoted from vice-president. In 1995, he spearheaded the creation of the National Oil Sands Task Force, which developed Canada’s new energy vision. Prior to joining Syncrude in 1986, he spent 17 years with Imperial Oil in
engineering and management, including division manager of Imperial Oil Canada. He started his career as an engineer with Cremer & Warner in London, England.
* Accolades: Newell is an Officer of the Order of Canada; the recipient of honorary doctorates from the University of Alberta, Athabasca University and University of British Columbia; and was named 2003 Energy Person of the Year by the Energy Council of Canada.
* Moonlighting: Newell is chairman of Careers – The Next Generation Foundation, which he founded; a director of Canfor Corporation; and a member of Aboriginal Human Resources Development of Canada.
* Passions: Bridge, cycling, cross-country skiing, golf.

THE COMPANY: SYNCRUDE CANADA
* Brass: Eric Newell, CEO; Charles Ruigrok, incoming CEO (effective December 15); Marcel Coutu, chairman; Jim Carter, president, chief operating officer; Phil Lachambre, chief financial officer/executive vice-president.
* Profile: Syncrude is the operator of the Syncrude Project, the world’s largest producer of crude oil from oilsands and the largest single-source producer in Canada, supplying 13 per cent of Canada’s petroleum requirements. The Syncrude Project is a joint venture owned by Canadian Oil Sands Limited, Canadian Oil Sands Ltd. Partnership, Conoco Phillips Oilsands, Imperial Oil Resources, Mocal Energy, Murphy Oil Company, Nexen and Petro-Canada.
* Key Milestone: In 1998, Syncrude produced its billionth barrel of crude oil, five years ahead of schedule.
* Website: www.syncrude.com
* Contact: info@syncrude.com, 780-790-5911.
* Address: P.O. Bag 4023, Fort McMurray, T9H 3H5.