The Saskatchewan Oilman of the Year Award was presented to Lane McKay at the Saskatchewan Oil and Gas Show on Wednesday evening, at the Weyburn Curling Rink. From left are MLA Dustin Duncan, Lane McKay and Oil Show chairman Del Mondor.
(The following profile was written by Brian Zinchuk, Pipeline News)
As the founder of Steel Reef Infrastructure Corp., Lane McKay has made a career of building companies in insurance, private equity and now associated natural gas and liquids processing in Saskatchewan.
Lane was born in 1960 in Calgary. His father was once a roughneck, but in his late 30s, he became the director of the Calgary Zoo after he quit the rigs. In high school the family moved to Waterton National Park, and Lane graduated high school in Cardston, Alberta in 1978.
He went to Grant McEwen College in Edmonton and earned a diploma in general insurance administration and risk management in 1985. He started working for Aoen, where he learned how to insure drilling rigs, gas plants and facilities. He was a commercial marketing broker in the oil and gas property department. Even though it was a slow time in the oilpatch, rigs still had to be insured as they were collateral on loans.
In 1990 Lane married Shannon Gellatly of Calgary.
He worked with Aoen until 1990, when he went on to be cofounder of Canada Brokerlink Inc. As director and executive vice president of business development, he completed a total of 42 acquisitions in Ontario and Alberta from 1991 to 1998. This built Brokerlink into the largest independent property and casualty insurance brokerage in Canada before selling the company to Allianz Insurance in 1998.
During this period he learned consolidation strategies which would be helpful down the road.
Having “retired” at 38, his wife soon pushed him to go find something to do. In 1999, a new industry, private equity, was just getting going, and small private equity funds in North America were funding junior oil and gas companies.
With partners in Houston and New York, he cofounded COSCO Capital Canada in 2001. With his partners, Lane built this New York-based private equity investment bank into the leading oil and gas private equity focused investment bank in North America, before selling the company to New York brokerage firm Rodman & Renshaw in early 2007.
They would originate and start up oil and gas companies, and market them to private equity funds. They only worked with private companies, at a time when the public junior market was going crazy. Some examples were McCaw Energy, Action Energy and Stratagem Energy. These firms would explore and develop a field, then sell it to an energy trust. By 2007, they had completed 42 startups in North America.
They sold the company at the peak of the New York Wall Street investment bank market, selling four months before the crash. Lane remained with Redman & Renshaw on contract for another two years, commuting from Calgary to New York. He left in mid-2010 and started writing the business plan for Steel Reef.
He took more than two years writing that business plan. The company was launched in November 2012.
He brought in two good friends as key advisors, Dean Potter and Neil Roszell (both of whom have also received the Saskatchewan Oilman of the Year award). They kept directing Lane towards Saskatchewan. Dean’s company, Elkhorn Resources, was in need of sour gas processing near Northgate, where they had done extensive work. Steel Reef’s first gas plant, North Portal I, was in response to that need, launching the company.
As with his other ventures, Lane brought on two young partners, Scott Southward and Austin Voss.
Together with the backing of PFM Capital in Regina, construction was started in the spring of 2013. It was the first gas plant in the area built in ages. Steel Reef remains, to this day, PFM’s largest investment, with multiple rounds of backing.
North Portal went into operation in 2014, with a second phase completed in 2015. A new plant was also built at Alameda in 2015. The next year Steel Reef bought the Kisbey gas plant from ATCO and Nottingham gas plant from NAL. In 2018, the Steelman gas plant was acquired from Plains Midstream.
In the meantime, Steel Reef built an oil pipeline and terminal in the Viking play, from Plato to Kerrobert. By 2018 they bought the Coleville gas plant and gathering system from TransGas.
In 2019 Steel Reef bought the Lignite, North Dakota, gas plant and gathering system. The year before, they built a short one-kilometre pipeline from North Dakota to Saskatchewan at North Portal. This was a significant feat as they were able to secure a Presidential Permit to do so, something the Keystone XL pipeline struggled with for the better part of a decade.
Lane notes that the midstream business is like a tortoise race, and you always have to be looking ahead four or five years, as it takes a year to raise money. His job is to be strategizing three years out. Their goal is to develop the associated gas system in Saskatchewan and do similar work in North Dakota. An office was recently opened in Denver to that end.
In 2017, Lane was the Saskatchewan graduating class valedictorian of the Institute of Corporate Directors.
He has served on the board of the Kid’s Cancer Foundation and New Jane Institute for Oncology Research.
Lane and Shannon have four children and reside in Calgary.
