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Deep-sea driller

Deep-sea driller

After amassing a personal fortune at global leader WorleyParsons, Russell Staley is using his experience to build another engineering empire.

There was once a time when academia was considered well-paying. Professionals routinely left the engineering industry to take on more

lucrative teaching or research positions at universities. For Russell

Staley - newly arrived from the United Kingdom in 1974 and highly

impressed with his $6000 a year engineering teaching fellowship at the

University of New South Wales - such attractions nearly cost him his

biggest break.

Thirty-four years later, Staley is a debutant on this year's BRW Rich

200, ranked 158 with a fortune of $265 million.

In 1979, Staley joined the fledgling engineering consultancy Wholohan

Grill and Partners, then doing about $1 million worth of business a

year. Three months later, he was offered another teaching job. But

after thinking hard about it, he turned it down to stay with the firm.

The consultancy went on to become WorleyParsons, now a global company

with a market capitalisation of almost $8 billion. Staley, the

company's 13th employee, is its seventh-largest shareholder.

Staley is hoping his timing is just as good with a company he now

chairs, Benthic Geotech. He hopes to apply the management techniques

and strategy he learnt at Worley to Benthic, and transform it into a

similar fast-growing company. "I am extremely excited about where this

company is going," he says.

Benthic, which provides sub-seabed data-gathering services to the oil

and gas sector for engineering, geotechnical and scientific studies,

ranked in the top 10 on the BRW Fast 100 list in 2005 and 2006. In the

latter year, the company's revenue was $9.02 million, a figure that

Staley and Benthic management expect to be exceeded substantially in

the next few years. By 2013, the company forecasts revenue to surpass

the $100 million mark, with a possible listing on the Australian

Securities Exchange.

Benthic's revenue is derived almost entirely from its PROD (portable,

remotely operated drill) ocean-floor drilling system. This is

basically an undersea robotic drilling rig that can be dropped from a

ship to depths of at least 2000 metres to examine soil samples on the

ocean floor. An operator on the ship uses computers to control the rig

remotely. Drilling actions are all directed by robotic technology.

Benthic's customers are oil and gas companies wanting to test the

seabed to determine its suitability for drilling, where oil platforms

should be built and where to look for oil and gas reserves.

So far, the company has undertaken work for clients in Bass Strait off

Victoria, and the North-West Shelf, off Western Australia. Its

research and development centre is based at its headquarters in Sydney

and it has offices in Singapore and Houston.

Benthic has been in existence for about 10 years - its first years

were spent purely in research and development. Since then, it has

concentrated on commercialising its technology and contracting its

services.

The company is a minnow in its field, competing mostly with Dutch

giant Fugro, which has a market capitalisation of more than $3.85 billion.

However, Benthic has a crucial competitive advantage:

PROD fits into a standard open-top shipping container and its drill

can be fitted to smaller ships, saving time and money. Fugro, on the

other hand, levers drilling equipment straight down from a tailor-made

ship, taking more time to achieve what Benthic can and at a greater

cost.

"We have a strategic advantage that Worley never had," Staley says.

"The only advantage that Worley had was perhaps its position in the

oil and gas industry. But Worley didn't have any smoking gun in terms

of technology or anything like that, other than its culture."

Now it is a matter of convincing more big oil and gas companies to use

Benthic's services. Staley helps open doors with prospective clients,

the company's managing director, Peter Williamson, says. "He talks

the language of the oil and gas sector, which is extremely important

for us."

Benthic hopes to sign agreements with leading oil companies to

undertake work in Australia and Asia as well as in the deep seas of

the Gulf of Mexico, near the United States.

Staley learned about Benthic when WorleyParsons was considering

acquiring the company, a move it ultimately did not make as it wanted

to concentrate on providing services and did not want to own

equipment.

When he retired from Worley in 2004, Staley was approached by

Williamson to invest in the company himself. Staley joined the board

as chairman alongside another long-time Worley executive, Andy Le

Messurier.

Most of Staley's 25 years at Worley were spent working in the

company's oil and gas division, which he headed before his departure.

Staley also established Worley's Perth office, from which it was to

win plenty of work on the North-West Shelf.

He oversaw the growth of Worley's Asian businesses and helped manage

alliances with partners on big contracts. He was still working at

Worley when it floated in late 2002 at $2 a share (it was recently

trading about $21).

Staley says much of Worley's success stemmed from its collegiate

mentality, having started as a small outfit. "It was a place where if

you had a good idea, you would get backing for it and everyone felt

like they were an owner of the company," he says.

Staley was integral to the company's rise, Worley chief executive

John Grill says. "He obviously played a key part in [Worley's] growth

at the time and was one of the key people that supported me. Worley is

a different place without Russell and we miss him."

Upon joining Benthic, Staley instituted a company-wide review. The

blueprint that was used for the review was drawn straight from his

experiences at Worley. There, Staley and other executives implemented

a management system called the Strategic Management Program, developed

by Robert Bruce of the Macquarie Graduate School of Management.

Part of the strategy is to concentrate on a particular sector of the

market - oil and gas - rather than trying to spread across a range of

different industries.

Benthic had considered being in a broad range of industries, including

civil infrastructure and wind farms, before Staley made the decision

to concentrate on oil and gas.

"Robert Bruce used to drum into us that developing strategies in

profitable businesses is the difference," Staley says. "There is no

point in having your product in an industry that is not profitable."

At a time when oil and gas companies are drilling deeper and deeper

into the seabed to look for dwindling supplies, Staley's timing in

implementing his strategy could once again prove to be savvy.

Russell Staley

Chairman,

Benthic Geotech

AGE: 57

BORN: London

LIVES: Sydney

CAREER: Left the United Kingdom after earning a civil engineering

degree to take up a teaching fellowship in Sydney. Joined the small

engineering firm Wholohan Grill and Partners in 1979, which became

WorleyParsons. Spent 25 years at Worley, eventually becoming executive

in charge of its oil and gas division. Established Worley's Perth

office and oversaw the growth of its Asian business. Left in 2004 and

became chairman of Benthic Geotech, which provides deep-sea drilling

services. Still holds several million Worley shares. Debuted on BRW

Rich 200 this year with $265 million in wealth.

GOAL: To turn Benthic Geotech into a global company like WorleyParsons.

INTERESTS: Windsurfing,

mountain biking.

Fairfax Business Media

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