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DICK CHENEY AIN'T STUDYIN' WAR NO MORE

As an Iraq attack seems nearer, he's in a far quieter oil patch as CEO at Halliburton

Dick Cheney is best known as a seasoned cold warrior. So, as the U.N.'s war of words with Iraq flares up, the former Defense Secretary and Persian Gulf war strategist is once again a hot media commodity. CNN wants his take on the sorry state of the Persian Gulf war coalition. USA Today wonders if he's running for President in 2000. As cool, composed, and cerebral as he was at the height of the 1991 crisis, Cheney smoothly fields all the queries. Only this time, he's handling them from his big corner office at Halliburton Co., the oil-services giant.

It seems an unlikely venue. But Richard B. Cheney, conservative pol and 25-year Washington veteran, has been learning a new career as ceo of the $9 billion Dallas-based Halliburton. And since taking over in 1995 amidst a global oil boom, he has made the transition to corporate life with apparent ease. But the real test of management skills will come with the inevitable oil downturn. That's when he will have to prove he's more than a big-name executive with a golden Rolodex.

SMART WELLS. For now, though, Cheney is hard at work shifting Halliburton into high gear. He's well on the way to transforming a low-tech, old-fashioned oil-services company into a leader in so called ''smart wells''--ones that use computer software and magnetic imaging to help identify rich deposits. Already, Cheney has poured more than $1 billion into such technologies. At the same time, he's courting politicians and business leaders through the booming Caspian Sea region in an all-out effort to secure key political ties with Azerbaijan and Kazakhstan. Accounting for the world's third-largest oil reserves, the region is Cheney's best hope to secure big contracts for a long time to come.

In Halliburton's two years under Cheney, it has clearly prospered. With demand for its sophisticated offerings soaring, profits jumped an eye-popping 51% last year, to $454 million, sending shares up 72%--among the best gains in the oil patch. And in 1998, profits should climb another 32%, according to Zacks Investment Research Inc. The pay sure beats government work, too. Cheney earned $2.2 million in salary and bonus and has picked up stock options worth $10 million.

BIG BITE. In an era when tycoons spend their millions in pursuit of elected office, Cheney is moving in the opposite direction. Born in Nebraska and raised in Casper, Wyo., he's a mix of avid outdoorsman and quiet intellectual. Friends say he's as relaxed in jeans, cowboy boots, and cap as he is on the corporate jet. And they note that on fishing trips he'll keep a lantern burning late into the night reading military histories.

It was on one such outing that Cheney crossed paths with former Halliburton Chief Executive Thomas H. Cruikshank. On a 1994 fishing trip in British Columbia with several ceos, his fireside tales of restructuring the military so wowed Cruikshank that, a year later, he offered to make Cheney his replacement. ''There are more synergies than people would think'' between running the Pentagon and running a corporation, says Cruikshank.

As was his style in Washington, Cheney is not charging in to force his stamp on Halliburton. Instead, he focuses on setting the strategic agenda while giving his top managers free rein to pursue a series of high-tech acquisitions. ''There are a lot of people here who know more about this business than I do,'' he says.

Meanwhile, he has concentrated on raising Halliburton's international profile through a network of contacts developed during his Washington days. Indeed, Cheney's business and social worlds blur together in a whirlwind of travel, meetings, and parties. Recently, for instance, Cheney, 57, and his wife, Lynne, a senior fellow at the American Enterprise Institute, were among the guests saluting Saudi Arabia's Prince Bandar and his wife on their wedding anniversary. Bandar, longtime ambassador to the U.S., is also a nephew to Saudi King Fahd. Says Halliburton President David J. Lesar: ''Dick gives us a level of access that I doubt anyone else in the oil sector can duplicate.''

BIG POND. The company won't reveal to what extent Cheney's contacts have brought in new business. And given the lead time required to develop projects, it's too soon to tell whether Cheney's rainmaking will succeed. But there's no question he has helped catapult the company into the big leagues. In the Caspian Sea area, he has brought the relatively small Halliburton into an exclusive circle of major oil companies. Together with the heads of Chevron Corp. and Texaco Inc., Cheney is one of just a dozen members of Kazakhstan's Oil Advisory Board, created by the country's president as a sounding board. ''His name and stature give Halliburton much greater opportunities,'' says Victor G. Beghini, ceo of oil company Marathon Group.

The high-stakes world of oil geopolitics is a long way away from Cheney's Western roots. As a boy, he learned to love books as much as the outdoors. When Cheney was 13, his family moved to Wyoming from Nebraska. In Casper, Cheney made the local library his summer hangout, poring over thick history tomes. A standout athlete and student in high school, he earned a full scholarship to Yale University. There, though, the young Cheney was overwhelmed by the academic rigors and wound up flunking out. ''I had a lack of direction, but I had a good time,'' Cheney now recalls.

Back in Casper, Cheney went to work for the local power company, climbing poles and setting lines. That was enough to convince him to take another shot at college. This time he enrolled in the University of Wyoming, paying $96 a semester in tuition. After earning a master's degree in political science, he received a congressional fellowship.

Once in Washington, Cheney caught the eye of Congressman Donald H. Rumsfeld (R-Ill.), who was impressed with his hard work and discipline. Rumsfeld brought his protege with him to the Nixon and Ford Administrations, and when Rumsfeld went off to run the Pentagon, Cheney took over as Ford's chief of staff at age 34--the youngest ever to hold the job. After Ford lost the 1976 election, Cheney got himself elected congressman. In 10 years in the House, he carved out a speciality in foreign affairs and chocked up a conservative voting record that rivaled Senator Jesse Helms's. In 1989, he was plucked to run the Defense Dept.

At the Pentagon, Cheney oversaw a massive military restructuring, dwarfing anything seen at IBM or AT&T. With the end of the cold war, he and his staff reoriented the military toward regional rather than global conflicts. The decision paved the way for the painful 25% reduction of the Pentagon's forces, the closing of 800 bases around the world, and billion-dollar reductions in defense budgets.

Quiet, intense, and at times brusque, Cheney avoids small talk on the job, even with his oldest buddies. David Gribben, Halliburton's vice-president for corporate affairs, who has known Cheney since high school, says meetings last only until he can get the boss's approval. One business friend calls him The Sphinx, says Lynne Cheney. At the Pentagon, his poker face earned him the nickname Deadpan Dick. Even Cheney's hobbies are an exercise in discipline. His wife says Cheney loves fly-fishing more for ''all the preparation that goes into it'' than for the actual experience.

STAYING PUT. Given the challenge of positioning Halliburton for the unavoidable industry downturn, his methodical approach will come in handy. In 1996, Cheney paid $560 million for Landmark Graphics Corp., a company with data-analysis tools that help puzzle out all the pieces of seismic surveys. A bigger acquisition, however, could be in the works. Many industry experts suspect that Cheney is eyeing Western Atlas Inc., a seismic services company currently valued at $3.8 billion. While he plays down talk of the deal, Cheney doesn't rule it out.

If Cheney is coy about a bid for Western Atlas, he is perfectly clear about one point: He won't be making any bids for elected office anytime soon. Although friends point out that he still stays in touch with former President George Bush and White House colleagues James A. Baker III and Colin Powell, Cheney insists that's as far as it goes. ''This is where I expect to spend the rest of my career,'' he says. With the oil market booming and CNN and USA Today still hanging on his every word, it seems that Cheney is sitting pretty right where he is.

By Gary McWilliams in Dallas



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