Cheniere Taps Former Calpine CEO to Lead US Gas Exporter

(Bloomberg) - Cheniere Energy Inc., which in February became the first to export shale gas from the U.S., has tapped former Calpine Corp. Chief Executive Officer Jack Fusco to lead the company, effective immediately. Cheniere rose the most since February.

Fusco is replacing Neal Shear, a former head of Morgan Stanley’s commodities division, Cheniere said in a statement Thursday. Shear became Cheniere’s interim CEO after the company ousted its founder, Charif Souki, in December. Fusco was CEO of Houston-based power generator Calpine from August 2008 to May 2014 and served as executive chairman of the company’s board through Wednesday, regulatory filings show.

Fusco’s target compensation for 2016 will be about $9 million, including a $1.25 million salary, $1.56 million target bonus and $6.25 million long-term incentive that will pay out over three years, according to a filing Thursday. Souki made $54 million in his last year at Cheniere, a seven-fold increase from 2014 thanks almost entirely to cash tied to the company’s stock and other incentives. Fusco also received new-hire equity awards worth at least $5 million and will get 30 days of paid vacation. He has agreed to buy $10 million worth of Cheniere stock by Dec. 31. 

“Bringing in a guy like Jack makes a lot of sense,”  John Bartlett, who helps manage about $2.5 billion of energy and utility stocks at W.H. Reaves & Co. Inc. in Jersey City, New Jersey, said by phone Thursday. “His key mission is going to be executing their business plan.”

Souki was fired for what he described as a disagreement over the company’s strategy. Billionaire investor Carl Icahn, Cheniere’s biggest shareholder, told CNBC in an interview last month that he played an “instrumental” role in his termination, adding that Souki had “harebrained ideas.” The exporter’s stock has plunged by about 54 percent in the past year, weighed down by the collapse in oil prices.

Cheniere rose 7.3 percent to $35.10 at 9:58 a.m. in New York after earlier gaining 8.5 percent, the most since February 26.

‘Huge Challenge’

“Unfortunately, in the last six months, the company has wasted some time in terms of implementing the transition from a development company to an operational company,” Souki said by telephone Thursday. Fusco “has a huge challenge. Everybody says he is a good guy, very nuts-and-bolts oriented, which is presumably what the company wants in terms of the new direction.”

Fusco’s compensation at Calpine totaled $1.53 million last year, a regulatory filing shows. That included a salary of $675,658. He stepped down as CEO of Calpine “as part of a planned leadership transition,” the company said in a Nov. 7, 2013 statement.

Before joining Calpine, Fusco was CEO of Texas Genco LLC, an independent power company and was an energy investment adviser before that, according to Calpine’s website.

“Our priorities will be focused on continued execution and completion of the LNG trains, both under construction and under development, and further commercialization of our LNG portfolio," Fusco said in the statement.

Houston-based Cheniere became the first company to export a cargo of liquefied natural gas from America’s shale formations in February, sending its first tanker to Brazil. Other LNG export terminals are being proposed along U.S. coasts as the boom in shale drilling leaves the country awash in the heating and power-plant fuel.

In an interview with Bloomberg TV last month, Shear said Cheniere would require a “significant premium” before entertaining potential takeover bids, even as the outlook for LNG exports has dimmed amid a worldwide glut.

- With assistance from Jim Polson, Brandon Kochkodin and Harry R. Weber. To contact the reporter on this story: Lynn Doan in San Francisco at ldoan6@bloomberg.net To contact the editors responsible for this story: Lynn Doan at ldoan6@bloomberg.net Jim Efstathiou Jr., Charlotte Porter

Copyright 2016 Bloomberg News.

WHAT DO YOU THINK?

Click on the button below to add a comment.
Post a Comment
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

Related Companies
Events  SUBSCRIBE TO OUR NEWSLETTER

Our Privacy Pledge
SUBSCRIBE



Most Popular Articles
From the Career Center
Jobs that may interest you
US Williston: Entry Level Administrative Associate
Expertise: Secretarial or Administrative
Location: Williston, ND
 
United States Odessa: Area Resource Coordinator
Expertise: Operations Management|ROV Ops / Tech|Sales
Location: Odessa, TX
 
Gas and Electric Field Operations Manager Job
Expertise: Budget / Cost Control|Operations Management|Refinery / Plant Operations Supervisor
Location: Evergreen, CO
 
search for more jobs

Brent Crude Oil : $45.89/BBL 3.69%
Light Crude Oil : $44.48/BBL 3.97%
Natural Gas : $2.96/MMBtu 1.00%
Updated in last 24 hours