Lad Handelman Part 2 By Staff in cooperation with Lad Handelman and Profile ofChris a topherPioneer Swann

Photo selection and captions by Lad Handelman. All photos courtesy of Bev Morgan, Lad Handelman and Bob Ratcliffe.

s a result of Union Oil’s Platform … and doing an honest job. It was A oil spill in the Santa Barbara this unorthodox approach that allowed Cal Channel on January 28, 1969, the Dive to survive the “dark period” and then drilling industry in California become Oceaneering and beyond. came to a screeching halt. The new start-up How many times have we heard “it is Agroup Cal Dive’s chances of survival were being in the right place at the right time”? dark indeed. Factually speaking, Cal Dive was in the Putting to use the expression “necessity wrong place at the worst time. How could is the mother of invention,” before going this mini-sized group, with no resources, under, Cal Dive found a way to take prime compete with the likes of the financially- contracts out of the grip of Cook Inlet’s long backed and established divisions of entrenched dive contractors, replenishing corporate giants like Union Carbide its coffers in the process. At the same time (Ocean Systems), Westinghouse (Sanford Bob Ratcliffe was finding a way to undercut Brothers), International Utilities (Divcon), longstanding large marine contractors’ lock Halliburton/Brown & Root (Taylor Diving) on municipal projects and still collect lots and government subsidized Comex? of profit for the company. What Cal Dive The answer was very simple: Cal Dive / lacked in size and reputation was made early Oceaneering had to be creative and up for by crafting innovative inexpensive relentless in the winning of contracts.

Fourth Quarter 2014, Volume 22, Number 81 The Journal of Diving History 23 The next coup was Cal Dive, a tiny Santa Barbara group, beating out all the large international dive companies to be contracted for Gulf Oil’s first exploration off the east coast of Australia. Reading & Bates’s novel catamaran drillship suffered extreme seafloor consequences, calling on the Cal Dive team to save the day time and again. It so happened that just as Gulf Oil was happily drilling away off the Great Barrier , news of the infamous ’69 blow-out finally reached the Brisbane Times, calling for an immediate halt to oil drilling on Australia’s environment jewel. Operations came to a screeching halt. Cal Dive’s hopes at this point seemed dashed again.

A MOMENTARY MONOPOLY But not long after, the Reading & Bates new flagship, the E.W. Thornton, moved to new operations in Indonesia. Then, thanks to the Reading & Bates guys touting Cal Dive as heroes, the door to the lucrative Southeast Asia market opened wide. For a moment, Cal Dive had a monopoly and was secure enough to open the very first diving contractor headquarters in Early 1970. Cal Dive and Can Dive create Oceaneering, joined by Singapore. World Wide Divers. The major stockholders were: (standing L-R) Being the only US service company (aside from R&B) in Johnny Johnson, Bob Ratcliffe, Mike Hughes, , (sitting L-R) Frank Stoltz, Kevin Lengyel and Lad Handelman. Singapore was an opportunity that was not missed. To expand and diversify, Sea Supply, (Southeast Asia’s first oilfield supply company) got launched as did Spiltrol (for emergency spills, contracted by Pertamina). Simultaneously, Cal Dive was landing more and more dive contracts. The window had opened and Cal Dive jumped through with both feet. Shell Oil Canada needed a /bell diving capability to service its five-year exploration effort offshore western Canada. Ocean Systems, Comex, and all the other corporate-backed dive companies were fighting to secure this long-term and strategically located contract. What chance would an individual upstart, with no bell and no helium capability like Phil Nuytten have? By all counts “none.” So what did he do? He immediately got with Cal Dive, who he knew had the helium diving expertise as well as access (through Reading & Bates) to a bell system, to form a 50-50 owned partnership, “Can Dive.” On top of that, Phil’s Canadian partner was world renowned wrestling champion, Don Leo Jonathan, western Canada’s hero. A natural born master of creative marketing, Phil must have played these cards perfectly. To the industry’s astonishment, Can Dive walked away with this five-year contract, thus providing another cornerstone for the formation of Oceaneering. In the Gulf of Mexico, where Cal Dive did not have a presence, but where they had worked with World Wide Divers, the sale of deep water parcels off Louisiana was expected to lead to big opportunities. Globally, some sources were predicting that the approximately $3 billion that the oil industry had spent on offshore drilling and production in 1968 would grow to $25 billion by 1977. As a small company, however, Cal Dive faced a major difficulty if they were to keep pace with their much larger competitors. Besides not having a presence in the Gulf, one glaring obstacle among others was lack of capital. The late sixties were heady years for corporate America. Infant Cal Dive could not qualify for bids because this tiny group Industrial giants were growing but their stock valuations were had no insurance and couldn’t get any... that is, until a young in- surance broker named Peter Barbara bravely stepped in. Once Cal lagging. Voilà, to reverse this picture, many conglomerates Dive had insurance and got on bid lists, more and more contracts acquired dive companies to excite their shareholders with were won, even from extreme locales like Nigeria, Iran, and Jakar- visions of producing unprecedented amounts of precious ta. Pete had to stick his neck out a mile to provide coverage for an endless number of high risk situations. Without Peter Barbara, Cal metals and minerals from the deep ocean, including vast oil Dive/Oceaneering may not have begun. discoveries. Thus virtually all the privately owned diving companies were snapped up.

24 The Journal of Diving History Fourth Quarter 2014, Volume 22, Number 81 Lad and Phil Nuytten with the off-shore industry’s first one-at- Cal Dive’s Secret Weapon: Developed by founder Bob Ratcliffe, mospheric dive suit. To compress a diver safely to 1,000 feet the Rat Hat system was uniquely able to keep a diver warm under took 24 hours. from 1,000 feet would take arctic conditions, keep him secure surface diving to helium depths 8-10 days. Oceaneering’s JIM Suit could hit bottom in 10 mi- and flexible enough for lock-out bell diving. Such safety-oriented nutes, work for 8 hours and return topside within 10 minutes. equipment gave Cal Dive a leg up on attracting top divers and a JIM was very inefficient but at the time was an industry real advantage in accomplishing difficult tasks. Rat Hats were Godsend and a good example of OI’s pioneering efforts. not for sale. Kirby-Morgan headgear is now the gold standard. Nuytten later invented the flying Newtsuit. Oceaneering still features the Rat Hat emblem.

The undersea bandwagon had a drilling division and / Oceaneering’s financial “Oceanologists study the had begun. construction division, both architect / strategist and Lad’s ocean. Oceanographers NOTE: Interestingly, in just utilizing divers. Santa Fe’s lifelong friend. His name map the ocean. Oceaneers about every case, this “sizzle” offer was $430,000 with an was Matthew R. Simmons. do work in the ocean.” Had became too hot to handle. earn-out that could be worth He was employed as a post- destiny not stepped in when Within a few years, just about an additional $300,000 - and graduate researcher at Harvard it did, there would have all of these corporate owned equally as important, the University. Lad at first thought been no Oceaneering and and managed diving divisions promise of career jobs for the “he was a kid who wanted to none of the other companies had failed financially - or Cal Dive owners just tending learn about diving.” He was spawned by the Cal Dive-Can worse… (Smit International, to Santa Fe’s in-house subsea soon to learn otherwise. After Dive-Oceaneering heritage. within months of acquiring a needs. Cal Dive was given 45 hearing of Cal Dive’s buy-out Equally as important as the New Orleans’ dive company, days in which to either say dilemma, Matt convinced Lad new capital was that a brand Michel Lecler, flew its senior “yes” to Santa Fe or the offer to allow him the thirty days new Oceaneering Board of financial guy to investigate would expire. (the amount of time before Directors was formed featuring “questionable” activities. The the Santa Fe offer expired) by reps from the venture capital report is that no sooner had FINDING A BETTER WAY which time he would bring groups. “The wisdom and this guy gotten out of the taxi Selling to Santa Fe would a firm offer of over $300,000 expertise they provided was at the company’s parking lot, provide the partners with cash for a minority position, the invaluable.” than he was shot dead. That and security, but Phil Nuytten amount of funding Cal Dive Lad told his partners that was more than enough for Smit wasn’t satisfied. He cornered needed, without any buy-out. aside from the new Board, to decide that their operating Lad and challenged him. He Working at it night and day, the survival and success of style and the diving company’s reminded Lad of why they all within ten days, Matt created Oceaneering would depend style did not mix. As these joined in the first place: “Not to a compelling prospectus on on being able to attract new mis-marriages failed one by have idiot bosses to report to, Cal Dive. Thirty days later, operational blood, specifically one, young Oceaneering was and to be able to do our own Matt showed up with a signed the kind of people who to pick up the pieces.) As Lad thing the way we want.” Lad Letter of Intent from a group of could provide everyday recalls, “It was not as though agreed that there must be a venture capitalists specifying financial control and executive we were so good… it was that better way. $350,000 for a 30% stake in the experience. The existing line- the conglomerate-controlled In the midst of all these company. Phil and Lad rejoiced up could not provide this. To competition was really bad.” buy-out offers, recognizing and even the partners who recruit such individuals at the Even young Cal Dive had his ignorance Lad went to had been skeptical jumped in. pay level Oceaneering could been pursued. Buy-out offers a seminar on mergers and Phil’s Can Dive was an integral afford, Lad sold the idea of came from Halliburton’s Taylor acquisitions to find out how part of the new corporation minimal pay in turn for a piece Diving, André Galerne’s IUC earn-outs worked. It was at they named Oceaneering. of the action e.g. sizable stock and several conglomerates. this fateful conference that Lad says he thought of the options. They came. The result By far the most tempting offer destiny stepped in, in the name as more accurately was fantastic. This “stock for came from highly respected form of a young man who representing future diversity pay” idea worked! Santa Fe International who was to become Cal Dive’s and geographic expansion. A few months later, after

Fourth Quarter 2014, Volume 22, Number 81 The Journal of Diving History 25 these preliminary pieces were Then, in the spring of 1971, and immediate. He knew sale to Comex. Representing in place, Mike Hughes and Lad got a telephone call from that if the deal went through, Oceaneering were Lad, Mike Johnny Johnson merged World Nick Campise, the president the Comex-Divcon combine Hughes and Johnny Johnson, Wide Divers—then doing of Divcon, saying there was would command 80% of the plus a member of the financial over $1 million in sales—into an opportunity, if Oceaneering world diving market, and staff and the senior partner of Oceaneering and became was interested, to talk to the even Oceaneering with all its the company’s law firm. major stockholders in the new parent company, International tenacity would have little if Under the of company, with Mike becoming Utilities, about buying Divcon: any chance to grow. Faced with the imminent arrival of the Chairman. a surprising suggestion given that frightening prospect, Lad Frenchmen, the discussions Overnight, the that Divcon was roughly five persuaded the Oceaneering were tense. ‘We had to do corporation’s business, balance times the size of Oceaneering. board that although the a lot of fast talking and sheet and base of operations Campise’s call to Lad company had neither the fancy footwork to convince expanded from the struggling came at the last minute of resources, organizational International Utilities we West Coast to the booming Divcon’s eleventh hour. For the capacity nor expertise could pull this off, especially Gulf of Mexico. previous two or three months, necessary to acquire and run because we didn’t know Cal Dive, until then International Utilities had Divcon, they had to go for it – ourselves if we could,” Lad essentially a partnership, was been negotiating with Henri and now – before this window recalled. “At a critical point now a true corporation whose Delauze to sell the company and Oceaneering’s future in the negotiations, when we interests were those of the to the French firm Comex. closed. Amazingly he and Mike had to confess we didn’t have stockholders, not those of the Several of the conglomerate’s got the board to agree. the promised money, their owner-partners. representatives had even The negotiations took place Vice President of Divestitures, The transformation from spent a week at Delauze’s in Philadelphia at the national Joe Griffin’s blood boiled. He a company of individuals to house in Marseilles. Now headquarters of International stood up and walked out. a corporation with broader that the parties had settled Utilities Corp. It took place But his financial guy stayed. responsibilities required an on a purchase price, all that from late afternoon until late at In the end, Griffin came back adjustment on the part of remained was to sign the night just before Delauze and and made the deal. Octopus everyone, especially Lad. papers. Lad’s reaction when his general manager, Lamazou, Divcon had been acquired The business steadily grew. learning of this was strong were to arrive to conclude the by upstart Oceaneering. Lad

Lad, wearing a Rat Hat and fins, leaps off to work.

26 The Journal of Diving History Fourth Quarter 2014, Volume 22, Number 81 later said, “It’s a good thing we didn’t know all that was in this Pandora’s Box… Divcon’s situation was even worse than we’d imagined.” Right or wrong, the minnow had swallowed the whale. Delauze and Lamazou were boarding the flight in Paris when they got word, through a telex to Air France, not to come.

MOVING TO HOUSTON After the buy-out, Oceaneering moved to Divcon’s headquarters in Houston. Suddenly this relative upstart of a company found themselves the owners of an octopus- like concern whose tentacles extended around the globe. The whole thing had taken place so fast that the new boys had no idea where all the contracts were or even how many subsidiaries and affiliated companies Divcon had. “Making such a deal was crazy!” Lad described that what happened to him next was like a blind man walking through a mine field… things blowing up seemingly in every direction. Customers were calling from Nigeria, Iran and everywhere asking why dive crews weren’t showing up; divers’ wives calling and asking why paychecks weren’t showing up and worst of all, a series of diving accidents occurred, including four fatalities. The OI takeover depended on retaining Divcon’s Eastern Hemisphere VP and his management team. While DSV Constructor - turning the tables: Industry practice had been that diving firms’ work was telling divers what they could and could not do. pretending to be part of the new set-up and being paid Divers were low man on the totem pole, even though it was handsomely, this pre buy-out team had secretly formed that made the project go or not go. OI and Comex flipped this equation Deep Six Ltd. Still in control of Eastern Hemisphere upside down and became the prime contractor, providing both the vessel and the dive crews. The Constructor was OI’s first North Sea operations and administration, they systematically and Flagship to demonstrate this new model, which is now the way the covertly torpedoed ongoing contract relationships, diver/ industry works. employee agreements and equipment shipments. Chaos and confusion reigned. In the midst of this nightmare was a brave Nigerian secretary. Seeing Lad’s despair, she pulled out a book of code names and at personal risk told Lad about the many strange goings-on as witnessed from her vantage point in Lagos. Putting two and two together, The ARMS Bell: Lad and with emergency legal help, within 48 hours these received a call from Santa Fe International Deep Six saboteurs were served, then judiciously busted asking if Oceaneering and forced to flee to England. The Deep Six commercial could cover a five- year Celtic Sea cont- damage got repaired but not the human wounds. ract which had a catch While all this was going on, other Divcon foibles were to it. The project was rearing their heads. Over-the-side davits for lowering the to be in 3,000 feet of water. ROVs had not huge double-lock Seatask dive systems were breaking yet proven themselves. off their bases, one-inch lift wires were parting and over- Furthermore, Comex, sophisticated gas systems fatally malfunctioned. with great research resources, was the Then there was the hard to explain series of scuba gear only game in town for fatalities. What had Oceaneering bitten off? Simultaneous this depth. Not to miss out, a joint venture decisions had to be made across the board. “There shall be with General Electric no further use of scuba gear on any job for any reason.” was negotiated. Their Divcon’s monstrous two-story Seatask dive systems famous GE ARM was bolted onto a thick- were chopped in half – eliminating handling systems skinned sphere with catastrophes; highly sophisticated Draeger semi-closed a large window in breathing systems were tossed out, replaced with simple front. Work was accomplished utilizing and rugged Rat Hat systems. On top of this, Divcon, internal master arms perhaps out of desperation, had taken full-on dive system to control the powerful external arms. Comex contracts with dive crew charging $16,000 per month all- went home empty in. “No wonder they lost millions.” Under Oceaneering, -handed. Courtesy monthly contract rates doubled. Customers screamed. Nuytco Research Ltd.

However, once they saw that operational mishaps no longer occurred (which had interrupted the entire program), they stopped complaining. No contract was lost. “I spent my time on these drill rigs going totally out of my skull trying to get these British divers, who were darn

Fourth Quarter 2014, Volume 22, Number 81 The Journal of Diving History 27 cost of these engineering divisions was nearly $2 million. After the revamping of the Divcon dive systems, this entire engineering/service group was eliminated. Oceaneering’s operating philosophy was that each and every part of its on- site equipment needed to be doubly strong and simple enough to enable its dive crews to handle breakdowns independently, without project shutdowns and not having to wait for spare parts and engineers to show up.

STEADY AS SHE GOES By the end of the first year after the buy-out, defying predictions that they had bitten off more than they could chew, Oceaneering had put the combined company on a reasonably even keel both financially and operationally. They even made a profit. Tom Earls decided to move from headquarters in London to operations headquarters in Great Yarmouth. Lou Tapscott was brought in from Singapore to head up all Eastern Hemisphere operations and utilizing his long-established stateside client connections, firmly established Oceaneering as a North Sea rival to be reckoned with. Through the successful Divcon acquisition, Oceaneering had become one of the two biggest diving companies in the world. The other was Comex. From 1969 to 1975, Oceaneering’s turnover rocketed from $600,000 to $55 million. Admittedly, it was a period of rapid growth throughout the industry; but the company must clearly have been doing more than a few things right to expand at such a pace. The most important elements, Lad thought, other than not having a parent company, were its personnel and operating philosophy: “Oceaneering consisted of hard-core, hard-working people who knew the business, with a management that understood the need to let the field people run the operations. Our job at corporate headquarters was to be ‘gofers’: to get financing, provide equipment for the contracts, come up with new diving tables or procedures as the field guys decided we needed them, and to act as a support group for our diving superintendents. The SAAB SUB: Imagine Lad sitting in a control cabin wearing an That was our gospel. The most important guys in Oceaneering’s electronic, remote-control helmet with a pair of robotic master arms in his fists, flying along the sea floor inspecting and collec- world were those diving superintendents, not the guys back at ting heavy debris. When he looked up or down or turned his head corporate headquarters. or reached out to grab something, this magic vehicle obeyed his physical commands. This was the brainchild of collaborators Saab “Our operations managers and area vice-presidents were all Scandia and General Electric, led by Project Manager Phil Nuytten. ex-diving superintendents who’d come up through the ranks. SAAB SUB was too much, too soon. It was later replaced by today’s My personal belief was that it made more sense to educate an much less-expensive and less-sophisticated ROVs. This experience, limited as it was, is still the most exciting underwater experience experienced diving superintendent, a guy with a proven record Lad ever had. Courtesy Nuytco Research Ltd. of decision making and balls, to become an executive than to try to get a Harvard Business School graduate who knew all about management theory to understand and manage a bunch good guys, top divers, to accept a new kind of equipment,” Lad of hard-ass divers. I think in the end that was the single most said. “In one case, one top diver went down, spent 20 minutes on important bit of wisdom that separated Oceaneering from the a stage with me up topside. When he came up, he said he couldn‘t rest.” breathe; the Rat Hat was no good. I told him, next time try putting In 1974, to the astonishment of much more qualified marine your mouth on the mouthpiece, that might help!“ contractors, Occidental Petroleum chose Oceaneering to install The issue finally came to a head, tragically, on a rig off the South a mile-long pipeline segment from onshore out to where J Ray of France. Despite instructions from Lad and the operating vice- McDermott was completing the laying of a 30-inch pipeline president to use the Rat Hat, David Lardner, one of Divcon‘s best that was to bring oil from Occidental’s Piper field to the supervisors, persisted in using the Draeger gear, which he was Orkney Islands, a distance of 128 miles. It was the biggest and more used to, and died. According to Lad, the accident was traced most challenging project Oceaneering had ever undertaken, to an ice block in the orifice of the control manifold in the diving one which required skills and experience beyond any that bell, resulting in the gradual consumption of the in the loop Oceaneering possessed. Complicating matters was that the to the point of anoxia, and to Lardner being unaware that his gas pre-job survey was faulty, showing sloping sand outward from supply had stopped. After Lardner died, Lad replaced the Draeger the shoreline. Instead, a half mile of ragged reef tops, much of sets with Rat Hats and other easily understood equipment that it being pounded by ’s relentless breaking surf, was could be maintained in the field by the crews. discovered. LFortunately the job was on a time-and-material The only reason Divcon maintained a large engineering basis, not on a lump-sum basis. Construction veterans were staff onshore (Houston, Great Yarmouth, etc.) was to have pulled in and along with Oceaneering’s very best, a giant a quick response whenever dive systems failed. The annual sized crawling triple drilling machine got built and worked.

28 The Journal of Diving History Fourth Quarter 2014, Volume 22, Number 81 Industry Pirates: Cal Dive is born again. Shown here are founders Don Terry, Don Sites, Rick Foreman, and Lad Handelman. Not pictured is partner John Swinden.

The crews blasted 3,000 feet The introduction of prime year based on diving services, services from the same ship. of underwater trench 15 feet contracting meant that oilfield to companies whose turnover So the big players in the oil wide and a 3,000 feet long diving went from being a was thirty, forty, fifty million patch were no longer just the right-of-way out into 350 feet largely labor-intensive business dollars a year, simply due to drillers and large construction/ of water. In all, over 50 small to a largely capital-intensive the charges connected with pipe-lay contractors. The dive boats and various vessels had one: a change that would supplying the ships. A diving companies had emerged. Oil to be brought in and managed. become still more pronounced system and crew might go out companies had realized tthat it The deadline for meeting up in the latter 1980s with the on a monthly contract basis was the company responsible with McDermott’s pipe lay widespread adoption of for anywhere from $30,000 for what took place on the barge was met. Oceaneering Remotely Operated Vehicles a month in hard times, up seafloor that dictated job chalked up a profit of about $6 (ROVs). to $75,000 a month in really success or failure, and not the million on some $12 million Nowhere was this more so good times: that amounts to company who just owned worth of work. More than that, than in the technology-driven $1,000 to $2,500 a day. With the ship. It was at this point, Oceaneering was recognized as North Sea. Previously, in what the Constructor, we offered the when full service DSVs became a premier can-do contractor. was cynically referred to as same dive services but with available, that dive contractors At the same moment the meat business, taking on a the dive support ship as well at were emancipated and drove in time, Oceaneering and contract was mainly a question $36,000 a day, base price: that’s their own destinies. Knutsen, a Norwegian ship of rounding up the necessary a lot of bucks coming in!” Later, after the Ekofisk owner, formed a joint venture divers and sending them Surprisingly, although the blowout, Phillips Petroleum to supply one of the industry’s out to work for large marine overhead increased, managing began construction of the first first diver support vessels, the construction companies or ship a ship was not so different from oil company fire-fighting and Constructor. Knutsen would owners. Nearly all the diving managing a diving system. , a semi- supply the ship and crew. OI’s contractor revenue came from The capital investment was submersible called the Phillips role was to win the contracts, marking up the personnel, measured in millions for a ship, SS, which was to remain in supply the subsea capability very little from the equipment. and in a few hundred thousand this enormous Ekofisk field and run the project. Liking However, once the construction for a diving system. So the big ad infinitum. Every North what they saw, North Sea phase got under way and dive charge was for the equipment. Sea dive contractor fought operators kept the Constructor companies like Comex and As a result of that, the diving with no holds barred for the busy, awarding the JV back- Oceaneering provided the companies grew from a upcoming five-year extendable to-back contracts with a full ships and project management second-level service group to full services contract. At the package rate of $36,000-odd in the deep waters of the a key part of the development time, this would have been the a day. Eastern Hemisphere northern North Sea, the of the North Sea. Having once most valuable single contract Operations had quadrupled balance began to shift. As Lad broken the ice as far as offering ever let. Subsea International their turnover in the space noted: total ship services—on which (Odeco owned), Comex, 2W of two or three years. On “During those years the Comex paved the way—it was (Taylor Brown & Root) and the added strength of the diving industry changed its then a natural step to offer Ocean Systems had all invested Occidental pipeline and the profile from companies that project engineering services, heavily in perfecting the very Constructor returns, in 1975 had a turnover of two, three, underwater pipeline welding demanding technology of Oceaneering “went public.” five or ten million dollars a and other high dollar value underwater pipeline welding.

Fourth Quarter 2014, Volume 22, Number 81 The Journal of Diving History 29 Lad’s rugby team: Popularly known as Murder Ball, wheelchair rugby provided a way for Lad to “let it all out.” The game is high speed with the strategy being to crash the opponent off his wheelchair. Lad’s specialty was using his foot plate as a bat- Once an abalone diver, always an abalone diver. Real abalone tering ram to break spokes. His team, the Breakers, took the divers never quit. Storms never stopped him before so why Southern California championship two years in a row. should being paralyzed stop him now?

Oceaneering, although good OI’s profits. Still, OI made position of company chairman, no decision could be worse, at many things, had never over $3 million in profits for CB&I’s man was using insider to have the CEO dump all attempted underwater 1976 and 1977. Lad’s struggle knowledge – which is an his own stock like this would welding. Yet once the smoke to put OI on top again was absolute conflict of interest. absolutely trigger a huge drop cleared, Oceaneering was knocked off its tracks. Instead Lad, once learning of this of the stock price, perhaps to selected and its future was of leading a recovery cycle, move, reported it as such and 1/3 of its actual value. I finally further strengthened. Lad found himself embroiled ultimately the CB&I guy was convinced her that what it was in an unexpected battle with removed. But having their about was me having a clear INDUSTRY IN THE TANK giant Chicago Bridge & Iron, chance to cash in their chips mind to go forward, that for In 1976 the industry took a covertly planning a takeover. be blocked by Lad did not sit me it had never been about the nosedive. Seemingly overnight, This is an untold story well with those involved board money. All those around me, drillships were docked (along which according to Lad is too members. No love was lost then and since, have told me with OI dive systems stashed), ugly to describe in detail, even between the board and Lad. how stupid this was. I respond, new construction budgets now. While Oceaneering’s In the end, thanks to killing it may have been stupid for were slashed, industry service management was struggling the CB&I takeover attempt you but not for me. To this day, companies were taking a to survive a down market, a Oceaneering survived as an I am happy with my decision.” beating and by 1977 many large and very powerful inside independent entity, but Lad He needed to let go and were having to sell out or go takeover effort was waged had alienated himself badly think ahead without conflict. under. Oceaneering lost its behind the scenes. with the controlling board Lad’s position today is that source of its biggest revenue The almighty Chicago members. There would be had it not been for the yearlong producer, drillship contracts. Bridge & Iron had set its no going back. The company takeover bloodbath, having The catch 22 was that in early sights on having Oceaneering needed a CEO strictly devoted to fight off internal fires, that ‘76, in order to keep pace with become its entry point into to company business and who same effort could have been the number of newly ordered the lucrative offshore market. didn’t carry fresh wounds put operationally and perhaps drillships, Oceaneering placed Through a series of stock from his battle with several the 1978-79 loss period would orders for $11 million worth purchases, CB&I went from board members. Bringing in have been mitigated. In any of new dive systems and $3 taking a seat on the board to a new CEO was needed. Lad event, even though the new million worth of construction taking over the chairmanship – actually helped recruit him. CEO was soon to resign and barges. By the time this having unlimited access to all Lad was out! His emotions ran be replaced, the company’s equipment was actually company information. Lad was high! Oceaneering had been his roots proved strong and as the delivered, the projects that promised by CB&I’s highest baby! industry came back, so did were going on were so heavily executives that there would “Without a second Oceaneering. competed for that rather than never be a takeover attempt. thought after my tempestuous Lad’s struggles with lose money, huge amounts of Nevertheless, once in place, departure from Oceaneering,” the board triggered other inventory (drillships, supply the new CB&I chairman was said Lad, “I called my broker high-level resignations: ships, dive systems, etc.) were making tentative deals with at Lehman Brothers on Wall Don Sites, executive Vice “stacked.” The result was that some of the venture capital Street (they were Oceaneering’s President, John Swinden, Vice after a decade of astonishing investors to privately purchase underwriters) and instructed President, Asia and Mideast, growth topped off with 1975’s what would have been enough her to sell my Oceaneering and Rick Foreman, Office of record $7 million after-tax shares to control the company, stock, all 300,000 shares, the President, handling all profits, when the major sources thus eliminating any stoppage all the next day. She was executive and financial matters. of income declined, so did of a CB&I acquisition. In the flabbergasted and told me that Key executives as they were, 30 The Journal of Diving History Fourth Quarter 2014, Volume 22, Number 81 none of them had a financial “I was fascinated when Learning to swim all over again. Though his war chest or other outside using the Laboratory’s legs didn’t work, he source of income. Even so, microscopes that I could could hold his breath and go underwater facing an unknown future, they witness microscopic-sized forever. In his first elected to leave rather than newly spawned abalone tournament, out of be part of something they no bouncing along an invisible eight races, he took seven gold medals. longer believed in. Shortly after moonscape trying to escape kissing all their jobs goodbye, bigger microscopic predators,” the group communicated and said Lad. “Of three million decided to gather at Sites’s new spawns, only 30,000 or so Santa Barbara residence; it was escaped the first few weeks. By actually while wallowing in his the time they were big enough outdoor pool that they crafted for planting, we were lucky a new plan. They would start if 3,000 had made it. Having a brand new dive company obtained California’s very first and name it Cal Dive. It was open-ocean four-acre lease at under this banner that each of San Nicolas Island followed them had begun their careers by the planting, nothing prior to the transformation to could be more exciting than Oceaneering. It was with no to picture an abalone-built a new operating base in Texas. four potential buyers were small amount of trepidation causeway running between The company was now firmly chomping at the bit. Ten days that reality set in. If they the island and Long Beach. rooted. later Cal Dive had a letter of couldn’t make something Then, in its typical wisdom, The next feather in Cal commitment from Diversified happen mighty fast, this new the US Fish & Wildlife Service Dive’s cap was Sites and Lad Energies, a large public utility adventure would fizzle out. chose the same area at San getting in bed again with company in Minneapolis. As Lad’s role in the new start- Nicolas to helicopter in about their old friends at Occidental a testament to the absolute up Cal Dive was to guarantee 200 sea otters, theoretically as Petroleum and walking away integrity of Simmons & Co, the line of credit. According to a reserve colony in case of an with a lucrative five-year both the seller and the buyer him, he was told to “stay out of oil spill hitting their Monterrey contract to build and operate were represented by Simmons the way.” Lad’s partners, Don protected range. (Sea otters a 1,000-foot saturation system (partner Nick Swyka versus Sites, John Swinden and Rick are prolific eaters of shellfish, for a new Penrod rig. This was partner Matt Simmons). When Foreman knew more about the abalones in particular.) Not a special coup since Cal Dive the dust cleared, Cal Dive industry and its key players only was the government did not even own a diving maintained its identity, board than any other like-group plan a complete disaster, but bell at the time, let alone a members, management and in the world. Sure enough, its other effect was to kill any 1,000 foot saturation system. all, but as a separate subsidiary these guys never rested until further interest on my part on The next event was getting an of DEI. The Cal Dive partners contracts were landed and planting abalone in the wild.” almost identical contract with were cashed out and so long as money was coming in again. New Cal Dive’s first Cities Service. What the dive they continued to perform, had Lad was happy being a great success was landing a couple world was not aware of was a well-paying positions. cheerleader. of two-year contracts with the behind-the-scenes deal that Lad “Most of all I had ample Egyptian oil company, Gupco. had struck up with Delauze/ SUDDEN CHANGES time to pursue my longtime Meanwhile, Sites had been Comex. Cal Dive was only too In January 1985, Lad had dream of replenishing scouting the US Gulf Coast and happy to pay Comex below a devastating skiing accident, California’s diminishing had met Don Terry, the owner bargain rates to put Comex’s which put him permanently in stocks of abalone in the wild,” of International Oilfield Divers, stockpile of idle equipment a wheelchair and changed his said Lad. “That industry had a growth-minded company in to work. It was a win-win involvement with Cal Dive. opened up a whole new world Lafayette, Louisiana. The year situation. A contract for a third Lad elaborates: “Having to me and now the least I could before, International Oilfield 1,000-foot system, with Union transferred to Santa Barbara do was a little payback. Putting Divers had done about $3 Oil in Spain, followed. Rehabilitation Hospital still together a combine that could million worth of construction Within four years Cal Dive with a halo attached to my practically research and then diving and had built a solid was operating in five countries head, by long distance phone spawn and grow abalone reputation for having the best and doing $11 million in sales. calls and occasional meetings from scratch was a most divers in the Gulf. A deal was Lad and John Swinden were in the hospital with my Cal interesting challenge. Thanks struck to have Don’s company busy seeking joint venture Dive partners, I kept in the to a $250,000 government IOD merge with Cal Dive and DSV arrangements for a North thick of things and then against grant, collaboration with USC’s for Don Terry to have a seat Sea break-out. Financials were traditional hospital regulations, Marine Laboratory at Catalina on the board as a full partner. outstanding and prospects were flew off to Minneapolis to Island and the guidance of In the winter of 1980–81, Cal bright. Knowing how quickly attend an important Cal Dive world expert, Dr. Daniel Dive moved its headquarters things change in the world Board meeting. As it happened, Morse, the challenge appeared to Lafayette. The following of oil, the partners decided it my lifelong Singaporean friend, at least reasonable. Then, summer Lad did what he did was time to cash in – to enlist Brian Chang, had flown to returning from Australia, ex- best and convinced Marianne the services of Simmons & Co. Santa Barbara to surprise me, Cal Dive partner, Bob Ratcliffe, Galletti to throw her J & J Everyone knew everyone, and only to find out I had just left came back to manage the Diving Company of Pasadena Simmons drew up a prospectus for Minneapolis. Not giving it operation. into the pot. Cal Dive then had and within short order a second thought, Brian caught

Fourth Quarter 2014, Volume 22, Number 81 The Journal of Diving History 31 the next flight to Minneapolis “Right after surgery to dear friend Peter Barbara, who serving 6,000 at-risk youth and really did surprise me reattach my head to my once again made sure that his throughout Santa Barbara as I was just about to leave vertebrae, and when I first insurance company paid the County. the hotel, concerned about regained my voice, I occupied bills. Considering what risks Getting tired of having the several block walk in the myself having long distance I was putting others in, I quit oil companies blamed for freezing winter rain. Suddenly phone calls with the NOVA doing my monthly trips to polluting Santa Barbara’s Brian was there and told me group concluding a plan to Houston.“ pristine beaches, Lad not only not to worry, he would get salvage the Spanish gold- Needing something spoke out, he co-founded an me there. The Board meeting carrier, The Capitana San Jose, worthwhile to put his energy educational advocacy group was successful but the return carrying a documented $3 into, he co-founded two first called “BOB” (Bring Oil flight home was a weather- billion in gold bullion,” said hyperbaric Back), later renamed “SOS caused fiasco. All passengers Lad. companies, Oxycare and California” (Stop Oil Seeps) were stuck on the frozen “An arrangement between later Clinical Hyperbaric committed to providing the tarmac (so United Airlines the Columbian government Technologies, to provide public with the truth about claimed) when Brian and I, and the Swedish government oxygen treatment services where beach and air pollution using “medical emergency”, got finalized, and Cal to hospitals, saving affected actually come from – natural had them open the plane door Dive began organizing the individuals from non-healing oil seeps – and that by draining so we could make our exit to recovery effort. At that time, wounds and amputations. the high pressure oil reservoirs, the Albuquerque terminal to the Columbian Cartel war He also co-founded the the natural seeps would stop catch a different airline. The broke out and all plans were Marine Mammal Consulting and the pollution problem only problem was that my kiboshed. The gold bullion still Group with Peter Howorth, would disappear. arguably California’s foremost He says, “Even though new “Having Linda as my marine mammal and wildlife offshore drilling is still banned, life partner makes life expert, hired by industry and at least the industry is no worthwhile,“ says Lad. government to protect marine longer blamed for pollution.” mammals from harm during SOS California still fights the offshore projects. good fight. Lad founded Outlook, a As the Historical Diving wheelchair-bound support Society USA began to form in group, in 1987. Santa Barbara, Lad attended the 1992 Inaugural Meeting NOT SLOWING DOWN and was appointed to the HDS His latest and most Advisory Board, where he has interesting project has to do dispensed wisdom and advice with a new breakthrough for over two decades. technology aimed at For his services to the lessening one of life’s most diving and oilfield industries, debilitating issues, bone health Lad has received the Historical preservation, bone fracture Diving Society Pioneer Award, prevention and bone healing. the Offshore Energy Industry The inventor of the atomic Pioneer Award, and was microscope, Dr. Paul Hansma, inducted into the Association belongings and wheelchair rests in 850 feet of water four exclusively assigned this of Diving Contractors were in the cargo hold of the miles offshore of Cartagena.” technology to a young start-up International Commercial United airplane. From that Much later, after DEI had group he trusted to convert Diving Hall of Fame. point on, climbing up and appointed Jim Nelson to the technology into hand-held Other awards include the down plane exit stairs and then oversee their investment, they medical devices capable of Coalition of Labor, Agriculture through the airport(s), Brian offered to reinstate Lad as measuring/diagnosing bone and Business Lifetime carried me over his shoulder, president, wheelchair and all, strength condition within the Achievement Award, the Santa and finally threw me in a rental if he would agree to spend two human body – never before Barbara United Boys and Girls car so we could make it back weeks per month working full possible. Clubs Lifetime Achievement to the Rehab by 5:00 AM, just time in Houston. Lad declined. Called Active Life Scientific, award, the City of Santa two hours before I would have “I enjoyed three days these game-changing tools Barbara Citizens Award, and missed the 72-hour return time of the Offshore Technology are now being employed in the Academy of Underwater and been disqualified from Conference,” said Lad. select laboratories and research Arts & Science’s 2014 NOGI further rehab.” “Then, while flying along centers around the globe. FDA Award for Distinguished Don Sites continued as on Houston’s Loop 610, my approval is being sought. Lad Service. CEO and Lad as the part time Chinese helper who had was made Chairman of the Quite a list of Chairman. For the next year learned to drive but not Board in 2014. accomplishments, to be sure. or more, Lad flew to Houston understanding the rules of the Mindful of his youth in the However, as Lad points out, once a month in order to keep road, side-slammed another Bronx and the impact the Boys “Were it not for the 25 years his role. Lad says, “I may vehicle trying to exit, spinning Club had on him, in 1999 Lad of support and counsel of have lost part of my body’s both cars on the freeway and became a member of the Board my partner in crime, Patricia functions, but I never lost who onto the shoulder. Thank God of Trustees of the Santa Barbara Putnam, there would not be a I was.” no one died and thank God for United Boys and Girls Clubs, list of accomplishments.”

32 The Journal of Diving History Fourth Quarter 2014, Volume 22, Number 81