When John Seitz left the president and chief executive officer post at Anadarko Petroleum Corp. in 2003, he called old friend Bill Transier. As chief financial officer and executive vice president of Ocean Energy Inc., Transier was in the throes of overseeing the sale of Ocean to Devon Energy Corp., but was already looking toward the next venture. The pair considered prospects all around the globe, and narrowed their focus to one area in particular: the North Sea, which they view as having the potential to become the next Gulf of Mexico for U.S. independents. Together they formed North Sea New Ventures (NSNV). To attract the capital they would need for such an enterprise, they decided to tap public-capital markets. Continental Southern Resources, a small publicly held E&P company with assets scattered throughout the U.S. and some in Thailand, had been recruiting Transier to head a restructuring. Instead, Transier and Seitz merged NSNV into Continental Southern through a reverse-merger in February 2004, and turned it into Endeavour International Corp. (Amex: END). Today, Endeavour has amassed working interests in 18 blocks in the U.K. and various fields in Norway. Its proved reserves total some 2.7 million barrels equivalent and it will drill four wells in the North Sea this year, bringing Endeavour its first exploration success. Seitz and Transier both hold the title of co-chief executive officer, an arrangement they say represents the partnership they have forged and helps them be in two places at once. Looking at what they have achieved in the past 18 months, it's obvious they have been. Investor Why make Endeavour a public company? Transier We had a concept about bringing people together to compete effectively in the North Sea. We wanted to attract very senior people who had significant North Sea experience. But to do that, we wanted to offer them an ownership interest in the company. Of course, we also realized that to establish a company with the size and scope needed to compete effectively in the North Sea, we would need access to the type of funding sources that only a publicly traded company can access. We had lots of venture capitalists, or private-equity firms, that were willing to give us a lot of capital to get started, but they wanted too much control over the business strategy, the board and the management. John and I felt like we had the experience to run an E&P company. With the reverse-merger we raised $50 million of new equity, part of which was from our management team. The management team, including John and I, bought 10% of the offering. Investor How did you proceed? Seitz The first thing we did with that funding was put a technical team together. We had a very large 3-D seismic database we acquired within North Sea New Ventures called the MegaMerge. It's a vast 3-D seismic program of about 94,500 square kilometers. We went to the 22nd Seaward Licensing Round in the U.K. and won 18 blocks, which provides strong evidence that we have the right technical tools and people. Investor Does your team consist mainly of former Ocean and Anadarko personnel? Seitz The entire technical team is really recruited from highly experienced North Sea personnel and their entire experience base is North Sea. The geosciences and the operating people at the executive level came from Anadarko and the finance and accounting people at the higher levels came from Ocean. Investor Why the North Sea? Seitz It is a world-class petroleum province ignored for a significant amount of time by the majors, mostly because of past low oil prices. In the oil and gas business, most often you earn the highest returns when you're relatively early-not the first, but when you're early. If you look at the Gulf of Mexico 20 or 25 years ago, the independents pretty much took it over from the majors because they were focused on somewhere else in the world. We saw the same situation occurring in the North Sea. We're in a very stable environment politically and I can't think of anywhere else in the world I'd rather be. Investor What potential does the North Sea hold for a start-up, U.S. independent? Transier It would be very tough to try to start Endeavour today and do what we've done in the North Sea. The barriers to entry have gotten a lot more difficult, so our timing could not have been better. Now there are a number of companies on the scene, but we are recognized as a partner of choice in the region. We have more data and more exploration people focused on the North Sea than anyone. Investor Have you experienced any difficulties operating in the North Sea? Transier It sounds odd, but the increase in commodity prices has actually worked against us. If you're trying to build a solid E&P company over time, you have to have a balanced approach and when we went into this, we actually thought we would be doing a lot more M&A than we have. In February 2004, oil prices were $28. We sit here today with $65 oil, so that's made it tough for companies to want to do transactions. They all should be selling at these prices. On the flip side, the one transaction we completed has really worked well for us. It was a small company in Norway that has a producing base of a couple thousand barrels a day. With the increase in prices, the revenue from that production is covering our worldwide general and administrative costs. Investor In what parts of the North Sea are you interested? Seitz We were U.K.-driven initially because of the licensing round, but with the acquisition of our production base in Norway, we're gearing up for exploration there. We've also put together additional seismic data in the Netherlands and we're undertaking studies there now. Investor Has funding been easy to find? Transier There has been a lot of interest in the energy business for the last several years. When we put our original deal together, we sold it on the strength of our management team and the business concept. It was very easy to sell-we were five times oversubscribed for our initial offering. At the end of the first year, we used part of that capital to buy the company in Norway. In January, the convertible markets were as hot as they've ever been historically, and hotter for energy issuances than for anything else. So we were able to raise another $81 million in convertible equity. We're generating cash now from Norway, and we sold our Thailand assets that were carried over from the purchase of Continental Southern. Today we have about $100 million in cash on the balance sheet. That allows us a lot of flexibility to execute our business strategy. Investor How do co-CEOs work? Seitz Bill and I can do either role, the operating side or the financial. Obviously our individual strengths are greater in one area than the other, but the best part is we can be in two places at one time. It extends our visibility and our ability to handle issues. We think amazingly alike on all issues. Transier This is a risk business, and John and I have a very similar view about how to build an E&P company. We also have a common impatience-we want to get there as quickly as we possibly can. Seitz Our egos are in check and the only objective we have is to create shareholder value. Transier It actually is interesting to be able to walk next door and discuss business issues with your co-CEO and not feel that you ultimately have to make these decisions all on your own. Seitz Sometimes it's very hard to get an impartial or objective point of view from someone who is working for you, but since we're working together, we don't hold anything back. Investor Will you exit eventually? Transier The industry will continue to consolidate, and at some point we will consolidate. The question is: will we run it, or will they? Either way, we'll do what's best for our shareholders. We're not in this for the jobs, we're in this to find oil and gas and create value for the equity-holders. Since our management team holds a large sum of equity, we are fully aligned with stockholders' interests. Investor Do you expect to make more acquisitions this year? Transier Building a balanced E&P company means not shying away from transactions. For now, our best shot is to expand our exploration inventory and drill some of these excellent prospects our technical team is generating. Our goal is to become a several-billion-dollar company and with the right acquisition we could make that happen very quickly. Seitz Whatever you see us do will make a lot of sense.