www.oilweek.com/articles.asp?ID=480 -
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Published on: 10/19/2007
Last Visited: 10/19/2007
"I believe we've achieved all those goals," says Michael Heier, Trinidad's chairman and chief executive officer.
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"We're not price takers," Heier says emphatically.
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That's the kind of bench strength that we have," Heier says.
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The launch of Trinidad Drilling the next year was a good fit for Mike, who was born and raised on the oil and gas service side.
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Heier overhauled his first mud pump for his dad's company when he was 16.
"In the 1950s, 60s, and 70s, it was a matter of pride that you could take your kids out into the oilfield with you and get them working.These days, you'd be considered a criminal," he says.
After a short spell in the military, Heier became a ticketed millwright and rounded out his oil and gas training with 14 years on the exploration and production side with the family business.A voracious appetite for reading about everything from reservoir engineering to enhanced oil recovery overlaid his practical experience with theoretical understanding.
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Within a month of going public, we were almost half our IPO [initial public offering] price," Heier says.
The company was good at running its business, but had virtually no experience in public markets.Heier still had some things to learn, and eventually, as he puts it, he got his MBA the hard way: "The school of hard knocks is a tough professor."
After five months on the road telling the company story to garner some support in the retail and institutional world, Trinidad's stock floated back up to a healthier $2.90 (its IPO price was $2.50).
Trinidad's management saw that a commitment to growth and paying out dividends would be best served by an income trust structure.So it completed a trust arrangement in 2002.
"What we voiced to the market was that we were all about growth," Heier says.
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"Most of our competitors grew by picking low-hanging fruit on the acquisition front," Heier says.
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"From the point of view of every metric in the last five years we've had growth, growth, growth," Heier says.
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"We have always been, and always will be, investor advocates," Heier says."We try to provide a total return, which is a combination of capital appreciation of the stock and our distributions.Maintaining that trust is our primary mandate."
Future
"Going forward, we want to get oilier, deeper, more international, and more offshore," Heier says.
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"Not only can you see a long ways out, the relationships that exist between the operator and the service providers are very strong," Heier says."I like that environment and our team likes that environment."In fact, Heier considers Trinidad's offshore expansion strategy its biggest press release to date, but it has virtually gone unnoticed in the market.
Given that offshore rigs can cost twice as much as the $15 million Trinidad is paying to build some of its deeper land-based rigs for the U.S., how quickly Trinidad achieves its offshore objectives will come down to market support."So the goal of our management team going forward is to expand the company's appeal to the general investment market, not just the niche investment market," Heier says.
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