Live and learn: J.C. Anderson

An interview with J.C. Anderson, entrepreneur, engineer, poker player, founder of Anderson Exploration and Anderson Energy.

I didn’t have any money when I started Anderson Exploration. My brother raised a little money for us down in San Antonio, where he was a lawyer. We had about $400,000 committed from some Texas investors. Then I just hit the street, trying to work up plays and drilling deals. We sold the company to Devon Energy in October 2001 for $5.3 billion. We gained a lot of weight.

I wasn’t running around trying to sell the company. In fact, I didn’t want to. I mean, it was my life. But when those guys came in the door with that offer, the shareholders would have killed me if we didn’t sell.

It took me several months to really get over the sale. What the hell was I going to do? But I’m over it now; it was the right thing to do.

My father was the cashier in the Farmers & Merchants National Bank in Oakland, where I was born. It’s a little farming community of about 1,250 in eastern Nebraska. The people are quite similar to Albertans in attitude. Salt-of-the-earth people.

I spent two years in the counterintelligence corps of the US military. I never left the States, though, because when I joined in 1954, the Korean war was winding down. It was in the McCarthy era, and the division was concerned about subversives in the military.

I came to Canada on New Year’s Eve in 1965. I was chief engineer for Amoco, which was then Pan American Petroleum. It was 40 below when I came across the border in my car, with all my possessions. I wondered what I got myself into.

When I came up here, I saw tremendous opportunity and couldn’t resist the temptation to go to work on my own. I left Amoco in 1968.

Our biggest discovery was up at Dunvegan in northern Alberta on Sept. 19, 1970, OK, two days before my 40th birthday. It was

a very large gas field — produced over a trillion cubic feet of gas and is still producing. You’re only entitled to one of those discoveries. That kept the lights on for the next 30 years.

We never borrowed a nickel from the bank until 1982. That year we borrowed $200 million. You wouldn’t believe how easy it was. It’s when the banks were throwing money at people. Mind you, we borrowed it the old-fashioned way. We paid it back.

Treat investors the way you want to be treated. I couldn’t sell a deal I didn’t believe in. I’ve seen situations where the guy putting together the deal is going to do well whether the venture succeeds or not. I don’t like to do things like that.

You’re only as good as your people. The oil and gas business is quite technically driven, so you need super-technical people.

We expected an awful lot of our people, OK. We expected them to work hard, and we didn’t want that door hitting them in the ass at 4:30. But I also operated on the theory that I wouldn’t ask anyone to do something that I wouldn’t do myself.

You start having personnel problems once you get more than about two or three people in the shop. I think there were times when I had the reputation of being a hard-ass, tough to work for and so on, but I think by and large I took the right approach to things.

This spring we started another company, Anderson Energy. I thought we would have done an acquisition by now to put production in the till. But we’re not willing to compete with the prices the royalty trusts are paying. I mean, they’re swapping dollars. Some of it is unbelievable. I think a lot of the trusts are going to run up against a wall.

With the passage of time and work that’s been done in the Western basin, the opportunities are dwindling.

I’m doing a lot of things on my ranch that I should’ve done over the years. I’m going to make a more commercial operation out of it.

I’m 72 now. I know I don’t look like it. Everybody jokes that I don’t act like it. They still think I haven’t matured.

Do I travel? Shit no, I don’t care about traveling. I’m not a tourist. I’d have probably never gone anywhere if it weren’t for my four kids. They were all on the Canadian show jumping team. John was in the Olympics in Seoul and World Championships in Germany; Susan rode in the World Championships in Stockholm; Sandra was on the silver medal team at the Pan-Am Games in Havana; and Brian rode on a couple of World Cup teams in Germany. I’d fly over to watch them, and then fly back.

I’m a gambling man. We had a poker party at my place on Grey Cup Sunday. The first guys showed up at 3 o’clock Sunday afternoon and the last guys left at 7 o’clock Monday morning. We play a pretty good game. You’ve got to buy in for a couple thousand, and when you lose that, you’ve got to put up more money. I like a game called Gulf Coast Stud. I learned it in Louisiana. It’s five card stud, but we play it high-low split, shuck one at the end, and you have to shuck in order.

I usually do fairly well in poker. The most I’ve ever made in a game was well into the five figures. I’ve shot craps in a casino, too. But I’m not a wide-eyed gambler who needs to do it every day. The kind of gambling I like to do is where I can match my wits against the other guys at the table. I wouldn’t put a nickel in a VLT. The goddamn thing is programmed to beat you.

I studied petroleum engineering at the University of Texas in Austin. Every year they pick about four graduates of the College of Engineering and call them distinguished graduates, and they picked me for the award last year. There are 40,000 alumni of the College of Engineering, so it’s quite an honor. I don’t know how the hell they found me, though.


James Carl Anderson
Born Sept. 21, 1930, in Oakland, Nebraska.
Oil and gas baron, poker player.

1956: Leaves US military and joins Pan American Petroleum Corp. (now Amoco) as a petroleum engineer in the oil fields of Texas.

1968: Leaves Amoco to start Anderson Exploration Ltd. in Calgary with $400,000 in seed capital raised from Texas investors.

1988: Takes Anderson Exploration public, with an initial market cap of $180 million — after first effort stymied by Black Monday.

2001: Sells Anderson Exploration, now the fourth-largest gas producer in Canada, to US-based Devon Energy Corp. for $5.3 billion.

2002: Establishes Anderson Energy, a new oil and gas exploration company, which is now developing drilling deals.