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11/2/2016
2016 Technical Conference and Oilfield Expo

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Setting Stage for Energy Renaissance in Our Region

Posted By Shawn Bennett, David Spigelmyer, Kevin Ellis, Monday, September 19, 2016
Updated: Tuesday, September 20, 2016

As we anxiously approach the Shale Insight conference this week, let us take a look at what Shale has done for our region. The following letter to the editor was published in the Wheeling News-Register by Shawn Bennett, David Spigelmyer and Kevin Ellis, leaders of their respective organizations; Ohio Oil and Gas Association, Marcellus Shale Coalition, and West Virginia Oil and Natural Gas Association. Visit ShaleInsight.com to learn more about this regional partnership. 

Our region is blessed with an abundance of natural resources that have supported America’s energy needs for generations. Appalachia-produced raw materials helped usher in and ignite America’s Industrial Revolution, power the United States to victory in World War II, and provide good-paying, family sustaining jobs for hundreds of thousands of local citizens.

Today, America continues to rely on Appalachia’s abundant energy reserves to power our modern 21st century economy. Thanks to our domestic energy revolution — led by record natural gas production right here in the tri-state region — our nation is more energy secure than ever, allowing us to break free from reliance on foreign, often hostile nations to meet our growing energy needs. These uniquely American achievements are well worth celebrating.

Recognizing that shale’s opportunity — and challenges — have no borders, the Ohio Oil and Gas Association and West Virginia Oil and Natural Gas Association are joining with the Marcellus Shale Coalition to host the 6th annual Shale Insight conference to foster greater regional dialogue, discussion and unity in our shared goal of advancing shale development throughout the Appalachian Basin.

Some of these regional themes reflect the clear fact that shale development continues to support good-paying jobs, promote small business growth opportunities, generate energy savings for hard-working Americans and their families, strengthen our region’s environment, and spark a regional manufacturing revival.

In fact, Shell’s commitment to building a world-class petrochemical facility in Beaver County, Pa. — a $6 billion to $7 billion investment — is truly representative of shale’s broad benefits. Representing the largest investment made in Pennsylvania since World War II, this single project will have a significant and positive impact on our region’s economy as it’s expected to create 6,000 construction jobs — including many for our region’s building trade union members — and 600 permanent jobs once the facility is complete.

What’s more, this facility is expected to encourage additional manufacturing investments throughout the Appalachian Basin as manufacturers look to the tristate area to capitalize on our local energy advantage.

This inspiring American story of manufacturing’s comeback is the crown jewel of natural gas development as our region has the competitive edge for new, job-creating investment. That’s one of many reasons why a 2015 Harvard Business School report concluded shale represents the “single largest opportunity to improve (the) trajectory of U.S. economy.”

Indeed, thanks to natural gas, we don’t have to choose between economic growth and improved air quality. We can have both as the greater use and development of clean-burning natural gas has driven America’s carbon emissions to 24-year lows and enabled the U.S. to reduce its emissions more than any other nation.

But to fully realize shale’s economic and environmental benefits, natural gas infrastructure modernization and expansion is mission critical. A strong, reliable infrastructure network will connect consumers, manufacturers and power generators with our abundant, affordable energy resources. And to be sure, pipelines are the absolute safest and most effective way to transport natural gas.

From unleashing a manufacturing renaissance, to creating and supporting hundreds of thousands of jobs, and expanding our natural gas infrastructure network, shale’s benefits — and the challenges our industry faces — extend beyond state boundaries.

Of course, for our region to capitalize on shale’s economic and environmental opportunity, lawmakers throughout Pennsylvania, Ohio, and West Virginia need to get the energy equation right with pro-growth policies that encourage job-creating investment, greater production, and, importantly, end-use opportunities for natural gas, especially among our power generators and manufacturers.

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My Interesting Day in Athens County at the Wayne National Forest’s National Collaboration Cadre

Posted By Mike Chadsey, Director of Public Relations, Monday, September 12, 2016
Updated: Thursday, September 15, 2016

A few weeks ago the leadership of the Wayne National Forest sent out an invite to every elected official, chamber/economic development group and various industries, and different groups who oppose said activities, asking all to attend a collaboration workshop on a Saturday in Athens on the Ohio University campus. Figuring one of the topics was going to be leasing and development of oil and gas within and around the Wayne, I thought we better be there to participate in the conversation.

The morning of the event begin with a series of power points from folks around the county who had worked on issues in various forests, explaining how they worked to bring a broad group of people together in order to advance a project. It was wonderful to hear how others had figured out a way to work with those who don’t always agree, to make their part of the world a little better.

Then there was lunch. The announcement was made that lunch is on its way (in a fossil fueled car no doubt) and that its $5 a person for pizza and cash would be collected. Issues arose right away as the group was short on change, not everyone had 5 bucks, and some only had credit cards, etc. So I offered, anonymously, to pick up the entire tab (which couldn’t be more than $100) to save the hassle and keep the meeting moving. This created an uproar among the well haters. Suggesting I was going to “buy everyone off” so they will love oil and gas. Then I suggested that we could go halfsies on the pizza together to show a simple, but true, effort towards collaboration. I thought surely, we can agree on that, but that effort was rejected as well.

After lunch is when the day got really interesting. We were to break up into “issue groups” and talk about what we agree on, what we disagree on and how to move forward. There were groups formed to work on park trails with people representing both dirt bikes and horses, others formed about forestry and forest health. There were even groups based on the geographic area of the three units, Athens, Marietta and Ironton.

I joined in with about 10 others in the oil and gas group discussion. We started off in a small corner of the room sitting at tables and chairs and finally moved into the hallway as our group maxed out the space. At this point I came to realize that not everyone had a name tag. As it turns out, not everyone in our section had not been invited, as a group of students decided to participate and the leadership from the Wayne allowed them in. That was the right thing to do. Proving once again the leadership of the Wayne allows public comment as they have had through this entire process. To keep our conversation moving and respectful, someone kept a list of those who wanted to speak and called on each person to make sure each voice was heard. The conversation jumped around a bit to talk about leasing, drilling, chemicals, water usage, production and injection etc. After about an hour, we were told to wrap it up and move back into the main room for group reports. That’s when someone commented that this entire day was a “farce” among other inappropriate (language) comments. While it was hard to find a middle ground with the local activist group, I would not call the day a waste of time. Conversation on current events, like energy, is never a waste of time.

Then as the meeting drew to a close it was time for each group to report on the discussion and next steps. While most groups had something to report such as an accomplishment or at least a road map to an accomplishment our group had two different messages. The first was delivered by a local anti-development activist who proclaimed that, “this meeting was not inclusive, the Wayne leadership had already made up its mind,” this person did not support any oil and gas activity in, around, under, next to, the Wayne and really had nothing positive to say at all. Since each group was given 5 minutes to report and her ranting tirade took 3 minutes, I had 2 minutes left and I was going to take them. I thanked the Wayne for inviting us, I shared my appreciation for those who do not share my viewpoints on energy and I said that there is a long history of oil and gas development in the Wayne and we look forward to working with our community partners on the next stage of exploration and production in southeast Ohio. 

Since Saturday, there has been a few local newspaper articles about the event. In reading those pieces the theme that jumps out is that folks assert the leadership of the Wayne does not allow anyone the ability to publicly comment about leasing, drilling etc. but when you go back and read the headlines it reads -  A bit of dialogue emerges on Wayne National Forest drilling and this one that shows that they were there - Local residents, students occupy Forest Service meeting over fracking concerns. I was there as well, and plenty of conversation was taking place about the Wayne. Simply because people don’t agree with you does not mean you are not allowed to speak or that you are not being listened to. Anyway, it proved to be an interesting day and provided lively discussions about the many issues and challenges facing the Wayne National Forest in the coming weeks and months. 

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Member Spotlight: Judson (Jud) K. Byrd, Artex Oil Company, Land Manager

Posted By Lyndsey Kleven, Monday, August 29, 2016
Updated: Thursday, September 01, 2016

The member spotlight series features legacy OOGA members who have been a member of the Association for at least 10 years. If you would like to recommend someone to be highlighted, please contact Lyndsey Kleven lyndsey@ooga.org

 

Background information:

 

Jud Byrd is originally from the small town of Alexandria, which is found just west of Newark Ohio, and remained there until he moved to Columbus to attend The Ohio State University.  After taking a brief break from his formal education to join the United States Army, Jud served with the Military Police in Bad Tolz, Germany.  During his deployment overseas, he met the girl he would later marry.  Upon his return to the U.S., Jud returned to Ohio State University to complete his degree and graduated in 1975 with a degree in Business Administration, majoring in Finance and Real Estate.

 

Jud began his career in banking after graduation. One day he visited his father, a Partner in the law firm of Morrow, Gordon and Byrd, picking up a Title Exam for a mortgage loan.  While there, he shared with his father that his interest in banking was diminishing and he wanted to explore a new career path. His father shared with him that Stocker & Sitler Oil Company (a local oil and gas exploration company) was interested in hiring a Landman. Initially, Jud had no idea what a Landman did, but felt confident that he could fulfill the requirement and was up to the challenge.

 

Stocker & Sitler, Inc (Stocker & Sitler Oil Co.’s operating entity) operated over 700 wells.  Jud interviewed for the position with George Stocker and Guy Sitler and was offered the position. He accepted, and began what would become fulfilling career in the oil and gas industry.

 

Work History Overview:

 

Jud remained at Stocker & Sitler Oil Company for several years, endeavoring to become a very competent Landman.  As he learned the craft, he began acquiring leases for the company and assisted in all aspects of the Land Department.  His years of experience at his craft enabled him to become Vice President of Land in 1988.  When Stocker & Sitler decided to sell the company to CGAS Exploration in 1998, Jud remained on as Vice President of Land at CGAS. As has happened with so many Ohio il and gas companies, another acquisition later occurred and CGAS was sold to EnerVest in 2003.  Again, Jud was asked to remain with the company and continued working as a Landman for EnerVest in its Columbus and Charleston offices where he remained until 2006.

 

Jud began his career in oil and gas because he loved the challenge it represented and suited his attention to detail. What inspired his enthusiasm over the years was a desire to become one of the best Landmen in Ohio. He is a perfectionist by nature and that drive pushes Jud to give his best effort at all times.

 

“When I started at Stocker & Sitler, Guy Sitler told me two things:  The first… ‘Geologists can make mistakes, engineers can make mistakes, accountants can make mistakes, Landmen cannot.’  The second was… ‘Don’t ever drill a well in the wrong place.’ That seems rather obvious and it doesn’t mean that you don’t drill dry holes.  It’s just that you have to make sure that where you want the well is where you stake the well.” (He elaborated that if you don’t think that can happen, it does.)

In 2006, Jud joined Gary Sitler (son of Guy Sitler) who had decided to pursue the opportunity of beginning his own exploration company, Flint Ridge Energy, LTD. The company was successful for a few years but was greatly impacted as shale drilling became prevalent in Ohio. In 2011, Jud was in Marietta for a meeting with the folks at Artex Oil Company, regarding another matter they were working on; later that same year, he was offered a position there.

 

“I’ve been very fortunate to work with some of the best in the business in the oil and gas industry; I’ve worked for wonderful companies that has afforded me the opportunity to work with some brilliant geologists, engineers and operational personnel and Landmen. This career path has just been a blessing.”

 

Jud been employed by Artex since 2011 and remains there to this day. He will be the first to tell you (and has already relayed this to numerous people) how great a company Artex is to work for. He attributes that to Artex’s mission to drill and produce wells as efficiently and economically as possible. Artex has 19 full time employees and employs a number of contractors, enabling them to accomplish a great deal efficiently with a small staff.

 

“From the beginning of the well prospect, clear through the drilling of the well and production, and even after that, everything is done right. Our engineering is great, the geology is done well, and the company ensures that at every stage, everything is done correctly—and I really appreciate that.”

 

Over the last several years, Artex has specialized in doing 3D seismic and conventional drilling in the Beekmantown and Rose Run formations. Artex has shot 3D seismic in the State of Ohio and drilled more than 250 Beekmantown wells as a result.

 

Evolution of the oil and gas industry seen throughout Jud’s career:

 

When Jud first entered into the oil and gas industry, much of the drilling was focused in Clinton Sandstone wells in Eastern Ohio. Many of the wells were drilled as part of self-help projects for companies facing natural gas shortages during the early late 1970’s and early 1980s downturn. As companies sought to gain the supplies of gas they needed to run their facilities, they looked to drill their own production in order to keep the businesses running.

 

Coming off of the downturn, new formations were being discovered for drilling in the state of Ohio. Focuses shifted to the Knox drilling in the Rose Run and Beekmantown formations, allowing for fewer, yet more prolific wells to be drilled. For Jud, this made his position as a Landman increasing more difficult. In drilling a Clinton well there is less focus on being site specific. The new formations called for seismic and more specific drilling, which involved putting together deals with other companies, and other operators that control leases where you want to drill.

 

“In some respects it became more challenging.  I made the mistake one time while at CGAS to tell my colleague, Bill Grubaugh, that if he gave me a location, I’d get it drilled—never realizing that we were going to find so many locations in areas we didn’t have leased or owned by other operators.”

 

Another noticeable development Jud experienced over his years in the industry has been the countless mergers and consolidations that have taken place. Jud has seen many of the smaller operators affected by this, making them unable to compete with the larger companies in drilling wells.

 

This leads us into the largest and most noticeable change seen by everyone in the industry—shale drilling. The shale drilling came as a total surprise to many (including Jud), who mentioned drilling through the shale for years, into the Knox formations…never slowing down the bit to really take a look. Jud’s work as a Landman was greatly affected when shale leases became relevant, increasing the price of acreage. Over the past few years the technology of drilling these wells has improved greatly and allows wells to be drilled where they need to be drilled and completed how they need to be completed. Overall Jud sees the shale play as being a good thing for the state of Ohio and feels it will be a good thing for years to come.

 

With regard to the current downturn the industry is facing, Jud recommends patience and preparing for the next recovery. There have been several indicators over the past few months that prices are beginning to recover and drilling will increase as these price movements become real. Jud shared that Artex has scaled back, but that it is extremely important to use this time in preparation to drill when prices rebound.

“Our upsides are relatively short lived, because the industry has become so efficient in finding and producing oil and gas and you must be ready to take advantage of every day of those upturns. In the last 18 months we’ve really seen two downturns. The first downturn was when oil went to $60/barrel and gas $3 per MCF.  Then they dropped further to oil at $30/barrel and below $2 per MCF for gas.  I never thought in my career that I would see gas prices lower than the prices they were when I started in the business. In late 1977, gas was $2.20 an MCF, and I never expected to see that again.”

History with the OOGA and the MLBC/AAPL:

 

Jud joined the Ohio Oil and Gas Association (OOGA) in 1977, which was his first year working in the oil and gas business. In 1981, Jud became involved with the Safety Committee and throughout the years has remained actively involved with this group.

Jud feels the Association benefits the industry for numerous reasons. It offers networking opportunities available throughout the year and most importantly allows the industry to have a voice to represent the industry at a governmental level.

In addition to being involved with the OOGA, Jud has spent much of his career actively participating in professional Landman groups.  From the late 1970s he has been involved with the Michael Late Benedum Chapter (MLBC) of the American Association of Professional Landmen (AAPL). He is past president of the MLBC and served three years as a AAPL Director, representing the MLBC.

“I am proud to be a member of OOGA, MLBC, EMLF and the AAPL and of the contributions these organizations make to their memberships. I am a better Landman because of my association with these organizations…it not only provided me with education, but most importantly, many friendships that I will always cherish.”

 

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OOGA Awards Tom Stewart with 2016 Oilfield Patriot Award

Posted By Lyndsey Kleven, Communications Coordinator, Monday, August 22, 2016

During an August 15 ceremony, the Ohio Oil and Gas Association (OOGA) presented Tom Stewart, former executive vice president of the OOGA and principal at Oilfield Policy Advisors with the Oilfield Patriot Award, an annual honor bestowed by the trade association.

Established in 2006, the award recognizes individuals who have made significant contributions to protect, promote and advance the common interests of those engaged in all aspects of Ohio’s crude oil and natural gas industry. Stewart was honored for his long-time advocacy on behalf of the industry, which has included working with both state and federal legislators and representing the interests of Ohio’s oil and gas producers for more than two decades. Stewart’s advocacy for producers wasn’t limited to actions before the legislature; he was also integral in negotiating a landmark agreement between producers and Dominion East Ohio that benefitted all parties.

“The Oilfield Patriot Award was made for someone like Tom Stewart,” said David Hill, president of the Ohio Oil and Gas Association. “The legacy he has left behind on Ohio’s oil and gas industry has brought countless benefits to the industry and the members he represented. Simultaneously, Tom’s vision helped to establish a practical regulatory structure in Ohio and prevented onerous rules from entering our state. He has and continues to be a tireless champion for this industry and is a very deserving recipient of this prestigious award.”

A resident of Lancaster, Stewart is a third generation oilman. Beginning his career in the oilfields in the 1970s, Stewart was tapped to become executive vice president of the Association in 1991 and held that role until 2014. Stewart led the Association through numerous legislative battles, always relentlessly fighting to protect and advance the common interest of all the Association’s members. Stewart was a visionary who led the Association in embracing new producers into the state with the development of Ohio’s shale industry.

Past Oilfield Patriots include: Jerry Olds (2015), William G. Batchelder (2014), William Kinney (2013), Rhonda Reda (2012), Steven L. Grose (2011), David R. Hill (2010), James R. Smail (2009), W. Jonathan Airey (2008), Sarah Tipka (2007) and Jerry James (2006).

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Fracking Enters U.S. Presidential Race as an Independent, So Goes Ohio…So Goes the Nation

Posted By Mike Chadsey, Director of Public Relations, Monday, August 08, 2016
Updated: Friday, August 12, 2016

Over the last few weeks we have posted a few pieces about our time at the Republican National Convention in Cleveland as well as taken a look at the different national party platforms. Today, we look, with a wink and a smile, at a newly announced third party candidate, Fracking.

Considering the role that Ohio plays in national elections, it is so important for “Bill and Betty Buckeye” to examine the candidates and take a hard look at their track records, because more often than not Ohioans play a vital role in choosing who ends up at 1600 Pennsylvania Avenue.

As for Fracking, the announcement was made in a 60 second ad on social media.

Fracking – who was born near Hugoton, Kan., in 1947 – has been praised by politicians on both sides of the aisle. Her entrance into the tumultuous presidential race provides an attractive alternative for Americans dissatisfied with current choices.

The candidate’s campaign theme, Powering the People, embodies her proven record – and future agenda – of creating jobs, lowering consumer prices, strengthening energy security, reducing air pollution, and providing funding for critical public services.

“In 2016, America doesn’t just need a leader who can reenergize our country, but one who has a record of actually doing so,” said Fracking. “For nearly 70 years, I have been giving power to the people in states all across the country, from Pennsylvania and Ohio to Texas, Colorado, and California. This is the most important election of our lifetimes, and I ask for your support in this great campaign for our future.”

In the coming weeks, Fracking will launch a virtual bus tour that will take her across the United States and culminate with the selection of a vice presidential candidate. She looks forward to the fall debates where she can compare her record of improving the economy against the rhetoric of her opponents.

For more information about the candidate and her platform, visit www.frackingforpresident.com and follow her on Twitter and Facebook.

Fracking for President is a project of FrackFeed and North Texans for Natural Gas. It is intended for educational purposes only, although we can’t help it if people laugh too.

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Member Spotlight: Brent Breon, Caiman Energy II, LLC and Blue Racer Midstream, LLC

Posted By Lyndsey Kleven, Communications Coordinator, Monday, August 01, 2016
Updated: Wednesday, August 03, 2016

Brent Breon is a lifelong Northeastern Ohioan who graduated from Stow Munroe Falls High School and the University of Akron in the 1990s. Throughout high school Brent worked for a Goodyear Auto Service Center changing tires and performing basic automobile repairs. He aspired to go to college to become an automotive engineer and move to Detroit to work for one of the Big Three automakers.

 

When Brent was a senior in high school, East Ohio Gas (now Dominion East Ohio) was interviewing students at Brent’s high school for its scholarship program. Brent received one of the scholarships and started working for East Ohio as a Summer Casual before he started attending the University of Akron.     

 

Brent spent his first three summers of college working for East Ohio performing cathodic protection readings on pipelines as part of his East Ohio scholarship. He majored in mechanical engineering and participated in the engineering co-op program, where again, he was hired by East Ohio Gas as a co-op engineer. In the co-op program Brent spent alternating semesters working in various entry-level engineering roles in Akron and North Canton.  Upon Brent’s graduation, East Ohio reinstated its management trainee program and hired Brent full time. Many of the organization’s current senior leaders such as Jeff Murphy, Tim McNutt, Mike Reed, and Eric Hall began at East Ohio in this program.

 

“I held many different positions within East Ohio as part of the manager trainee program. The positions included roles in large volume sales, automated mapping initiatives, pipeline and compressor station engineering, and as an operations supervisor in construction and maintenance,” said Brent. 

 

After the two-year trainee program Brent accepted a management position in 1999 in North Canton as an Operations Supervisor for the Dominion East Ohio storage compression facilities. Brent remained in this role for the next three years while he finished his Master’s in Business Administration at the University of Akron.

 

Work History Overview:

 

With his MBA completed, Brent transitioned into a different role within Dominion East Ohio and began training in Six Sigma (a data driven approach for eliminating defects and improving processes) where he became a certified Black Belt. The training assignment spanned two years and Brent worked on a number of data driven projects to increase efficiency and reduce costs.  This gave him a much better understanding of the business and he was able to apply what he learned from his MBA directly to his career.

 

“During the time period while I was working on Six Sigma improvement projects, Eric Hall, Tim McNutt, Bill Kinney, Bruce Klink, Tom Stewart, Jonathon Airey and many others were working closely to negotiate the Ohio Production Enhancement Agreement between the Ohio Oil and Gas Association and Dominion East Ohio, which was the first every BTU adjustment given to producers and the first time producers had agreed to voluntarily pay a gathering fee on the Dominion East Ohio pipeline system.  This truly was a win-win for the Ohio producers and Dominion East Ohio and was enormously successful with a 99% participation rate,” described Brent.  “I was lucky enough to transition into become the Manager of Ohio Gathering shortly after the agreement was executed in 2003 and was able to participate closely in the implementation of the program.“

 

The timing of the agreement was ideal, as gas prices began rising through the mid-2000s and the passage of HB 278 opened up access to urban drilling. East Ohio was able to focus efforts to minimize system pressures and spent capital dollars to improve its pipeline systems to accept more Ohio production.  The joint OOGA-DEO Project Review Committee, which Brent co-chaired with Bill Bennett and later with Bill Kinney, approved investments in 17 different projects that totaled over $9M between 2003 and 2007 while production volumes on the Dominion East Ohio system grew from 50 Bcf in 2003 to 60 Bcf in 2007.  These investments included new compressor stations, pipeline extensions loops, and pipeline system acquisitions. The program was so successful that in 2007 it was expanded and extended through the Heat Content Agreement, which is still in place today. 

 

Brent remained at East Ohio through 2011 holding similar roles, including managing large volume sales, system planning.  In 2011, Dominion East Ohio connected the first Utica horizontal well drilled in Ohio by Chesapeake Energy, the Kenneth Buell 8-H in Harrison County. Shortly after that well began production, Dominion East Ohio and Dominion Transmission negotiated a gas gathering and processing contract with Chesapeake Energy. 

 

Brent had watched the successful development of Caiman Energy’s Marcellus gas gathering and processing system in West Virginia and became increasingly interested in similar opportunities in Ohio with the new Utica shale exploration efforts. In 2011 Brent moved to work for Caiman Energy as Vice President, Business Development, focused on helping Caiman expand its existing gathering systems into the Utica shale in Ohio.  Early in 2012, Caiman Energy sold its West Virginia gathering and processing assets to Williams for $2.5B and recapitalized to focus exclusively on Utica Shale gathering and processing opportunities with Caiman Energy II.

 

“The timing couldn’t have been any more perfect to join Rick Moncrief and Jack Lafield and the rest of the team at Caiman Energy,” described Brent.  “This is one of the most talented, passionate, and experienced team of professionals that I’ve ever had the privilege to work with and I’ve learned a ton about building a new gathering, processing and fractionation company.”

 

Shortly after the creation of Caiman Energy II, Brent, Rick Moncrief , and others at Caiman identified the rare opportunity to join Caiman’s private equity backing of $800M with Dominion Resources’ 500 miles of gathering pipelines in the Utica shale in Ohio and Dominion’s then under-construction Natrium processing and fractionation complex. Out of that vision in early 2013, Blue Racer Midstream, a joint venture between Caiman and Dominion was created.   

 

“From late 2012 through today, Blue Racer has been actively securing Utica and Marcellus producer agreements for gathering, processing and fractionation.  In 3 years’ time, we’ve contracted with 16 different exploration and production companies, installed over 200 miles of additional pipe, and constructed the Berne Processing complex in Ohio and the Natrium Processing and Fractionation complex in West Virginia,” detailed Brent.  “We are currently gathering close to 1 Bcf a day of Utica and Marcellus production volumes and our processing complexes are consistently seeing over 90% utilization.  The growth has been phenomenal.”

 

Horizontal drilling and state of the midstream industry:

 

 “I remember in 2007 assembling agreements with 66 different producers in Monroe County to construct the Carlisle compressor station and the 8” Carlisle to Caldwell pipeline.  These 66 entities were producing roughly 5 mmcf/d of conventional production and Monroe County had more new well permits than any other county in Ohio that year,” recalls Brent.  “Four years later, the very first Utica horizontal test well had initial production at almost 3 times those volumes.  One well, 3 times those volumes!“

 

The biggest change that amazes Brent has been the sheer increase in production volumes from conventional wells to shale wells and the size of gathering pipelines and compressor stations being constructed throughout the Utica Shale.

 

“A few years back a 6” or 8” pipeline was considered a large gathering pipeline in Ohio; now, a 16” to 24” is more the norm for shale well gathering,” Brent continued. “5 years ago a conventional Clinton well could easily be tied into and existing Dominion East Ohio distribution systems; now, Utica shale wells have their own large, high pressure gathering systems with compression, processing, and fractionation.  Everything has become bigger, faster and, unfortunately, more expensive.”

 

History with the OOGA:

 

Brent joined the Ohio Oil and Gas Association in 2003, became a board member by 2005 and remains on the Board of Trustees today. Brent was pleased to attain a Board seat so early in his involvement in the association. Brent has been active in various committees such as Commerce, Producers, and Nominating (electing new OOGA Board members) and helped to start the midstream subcommittee along with Steve Downey and Scott Hallam.

“I believe the OOGA has done a fantastic job of reaching out to existing and new midstream companies in Ohio in the last 5 years. The OOGA recognized that their efforts could not only assist exploration and production companies in Ohio, but they could also be instrumental in helping to shape future pipeline regulations in the state,” said Brent. “The work the Association did on Senate Bill 315 is a perfect example of recognizing a potential threat to the midstream industry and proactively working for the good of the producers, the midstream companies, and the citizens in the state.”

Brent has also been delighted in how the increased shale activity in Ohio has increased the employment opportunities for the state and in particular the number of younger members now active in the Association.  But, Brent still enjoys reminding people that, “I was in midstream before midstream was cool.” 

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The Town, Cleveland…The Topic, Energy

Posted By Mike Chadsey, Director of Public Relations, Monday, July 25, 2016
Updated: Tuesday, July 26, 2016

Last week, I had the privilege of attending the Republican National Convention in Cleveland. While downtown, I took the opportunity to attend a few energy themed forums hosted by various media outlets discussing how the topic of energy impacts the election, the economy and the environment.

The Atlantic, A forum on Energy and the Environment:

For those unfamiliar with The Atlantic, it is known as a publication that advances bold ideas on the urgent issues of our time. According to its website, “since its inception in 1857, it has evolved into a multi-media must-read, illuminating fresh thinking on politics, business, technology, entertainment, and culture. It stirs vital national conversations through groundbreaking perspectives and a distinctively unbiased approach.”

The Atlantic held a forum that focused on the topic of Energy and the Environment. A couple of key questions that were asked during this event included, what strategies and policies should the next President of the United States adopt to consolidate these gains in energy production? Is there an ideal mix of conventional and renewable energy sources that will help grow the economy while protecting the environment? To answer those questions and more, both Congressman Kevin Cramer, (ND-R) and Congressman Bill Johnson (OH-R) took to the stage. The first question was addressed by Congressman Cramer and he spoke of how Mr. Trump’s policy is “more fossil fuels, less rules while preserving our environment.” Additionally the Congressman went on to say that Mr. Trump, whatever the issue, looks at it from an “America First” point of view. No matter if it is the Trans Pacific Partnership, the Paris Climate agreement or their predecessors like the North American Free Trade Agreement, he will do what is best every time for America and its citizens. Then it was Congressman Johnson’s turn and he came right out of the gate talking about how honest he and other Republican members of congress are when talking about where our energy portfolio comes from and how it is based on natural gas, crude oil, coal and nuclear. Then he followed that comment up by saying when talking about renewables those opportunities “need to be market driven not mandated by D.C.” One of the major themes I walked away with is that these two gentlemen and many like them truly believe that producing energy and protecting the environment are not mutually exclusive.

To watch the video click here: http://www.theatlantic.com/live/events/striking-a-balance-rnc/2016/

The Washington Post, A forum on Energy and Economy:

The Post’s forum hosted the former Governor of the great state of Mississippi, The Honorable Haley Barbour who took questions from the crowd and a moderator, covered a wide range of energy topics. I had the chance to ask him a question about regulations. I was interested on his take on whether the states or the feds are best to regulate the oil and gas business, and where and when those lines should intersect. In answering my question, he went into great detail about the history of how states have regulated the oil and gas industry, excluding on federal lands and off shore. He explained from his perspective “that since the beginning states have regulated production, drilling, unit size, fracturing etc.” He shared that the control should stay with the states and went even further to share that the President’s budget had monies for seven different departments to regulate the industry, and it was his opinion that there is no need for that.

To watch the video (third video down) click here: https://www.washingtonpost.com/blogs/post-live/wp/2016/07/13/the-washington-post-will-be-live-at-the-republican-and-democratic-convention/

Politico, A Forum on Energy and the Election:

If you have not read POLITICO, it is a global news and information company at the intersection of politics and policy. Since its launch in 2007, POLITICO has delivered journalism about politics and policy making that is more useful to people with a professional interest in public affairs; and that is more fun to read for a community of people who love the drama and sheer sport of politics.

This forum featured several congressmen, business leaders and the U.S. Chamber of Commerce among others. The discussion focused on how the topic of energy was going to influence the candidates and/or the election itself. The conversation kicked off by looking at what is in and what is out of the Republican Party platform such as issues like carbon capture. Much of what was discussed was allowing the market to use things like carbon as a commodity instead of looking at it as a problem. There was even a reference to the anti-oil and gas movement of “Keep it in the Ground”, again suggesting let the innovators find solutions as a way of dealing with current issues instead of shutting industry down. America should continue to lead on issues like the environment by letting innovation solve problems.

To watch the video click here: http://www.politico.com/events/2016/07/politico-caucus-energy-and-the-election-at-the-rnc-225020?slide=0

These three forums are just a small sample of some of the great events and opportunities that were available to convention goers all week long in Cleveland. Leaving the city after all of the parties, speeches and activities a few things were clear. First, Cleveland did a great job keeping everyone moving and safe. Second, energy will continue to be a topic of important national discussion. Lastly, Ohio will play a key role once again not only on energy and the debate about it, but the overall election.

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Energy from the Party Perspective

Posted By Brian Hickman, Director of Government Affairs, Operations Managing Director, Monday, July 18, 2016

As the Republican National Convention comes to Cleveland this week, we thought it might be a good idea to look at what the two major U.S. political parties are saying about energy.

Republicans have focused their platform on utilizing America’s natural resources in an effort to achieve energy independence. “We support domestic energy production of clean coal and hydropower, as well as solar, wind, geothermal and nuclear power. And we support drilling for oil and natural gas in an environmentally responsible way,” claims the GOP’s website.

Republicans also want regulations that encourage investment, lowers energy prices, and creates jobs. Republicans site recent EPA regulations (including air regulations and the “sue and settle” process) as deter mental to the American consumer and economy. 

As you might have guessed, Democrats see things a little differently. According to their website, Democrats think that the time to rely upon “unsustainable energy sources” from the past is the “status quo by special interests”. Their website touts clean-energy technologies that are paving the way for a sustainable energy future. Democrats also see a “transition to clean energy” as a way to grow the American economy.

Curiously, with this as a background, Democrats go on to tout that under President Obama domestic oil production is at an eight-year high while dependence on foreign oil is at a sixteen-year low. This is in part due to speeding up the leasing process and improving safety, which has in turn expanded domestic oil production.  

While the general nature of these policies should remain, the degree and focus of them is destined to change in the coming campaign. For Democrats, the campaign of Bernie Sanders had a large focus on energy specifically oil and gas production and hydraulic fracturing. One could expect the party to lean closer to this view, which would be to ban hydraulic fracturing, further reject the keystone pipeline, and ban offshore drilling of oil and gas, in an effort to ensure the votes of former Sanders supporters.

For Republicans, one could expect a stronger message and support of fossil fuels. For the Trump campaign to be successful, swing Midwest states (specifically Ohio, Pennsylvania, and Michigan) will be needed for support. These states would benefit from enhanced energy production, be it oil, natural gas or coal. Trump must secure these Midwestern states in most election models to gain the Presidency.

As we head into the campaign season, one can only claim that anything can happen this year. I mean, the city of Cleveland did win a professional sports title, right?    

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UC Study Claiming Air Pollution from Fracking Quietly Retracted Due to Bad Data

Posted By Seth Whitehead, Energy In Depth, Monday, July 11, 2016
Updated: Wednesday, July 13, 2016

The University of Cincinnati (UC) has yet to publish the results of a now year-old study that found no water contamination from hydraulic fracturing in a scientific journal, despite scrutinymedia attention, and numerous calls from groups and elected officials to do so.

This indefinite delay is all the more interesting considering that UC couldn’t wait to publish the results of its 2015 study that claimed fracking was causing significant air pollution in Carroll County. That study appeared in Environmental Science & Technology just three months after it was completed.

But the UC researchers’ urgency has apparently come back to bite them as they have just retracted the study due to “errors” and “incorrect” calculations:

Retraction

UC’s rush to publish its air study while it dawdles for a year in publishing its groundwater study finding no harm from fracking is even more interesting considering the results of both studies were first announced at events hosted by Carroll County Concerned Citizens (CCCC), a well-known anti-fracking group. The same professor that presented the air quality study results to CCCC, study co-lead author Dr. Erin Hayes, has also participated in other anti-fracking events.

The retraction of the Carroll County air study comes as no surprise to Energy In Depth, which pointed out its many flaws last May. Not only were the study participants recruited by an anti-fracking activist group, the researchers did not use random testing, did not account for sources of Polycyclic Aromatic Hydrocarbon (PAH) other than oil and gas activity, and assumed worst case scenarios in their cancer hazard assessments. A Carroll County landowner also informed EID that some of the highest PAH levels detected by the researchers were collected on his property, which is more than 10 miles from the nearest shale gas well. This completely refuted the researchers’ summation that high PAH levels correlated directly to close proximity to shale gas wells.

The authors even admitted that the sample size used for their study was too small and that the chief assumption used for their research model was “totally impractical,” according to media reports.

That didn’t keep several media outlets from accepting the authors’ conclusions as gospel with such headlines as: “Fracking may cause air pollution, respiratory issues” and “Fracking could increase risk of cancer, new study finds.” This is a prime example of a rushed study, designed to scapegoat fracking, that fails to fully vet the data collected — yet garners media coverage anyway.

Making matters worse is the fact that the Carroll County air study was 100 percent taxpayer funded. UC’s Center for Environmental Genetics (CEG) received federal tax dollars for this study in the form of a grant from the NIH’s National Institute of Environmental Health Sciences (NIEHS)for $47,910.

Of course, the authors of the study do not disclose whether their revised calculations show much lower emissions – but considering this background and the fact that the researchers just omit that data in their retraction, it’s difficult to imagine their corrected results show anything other than a repudiation of their original conclusions. Regardless, the real problem is this: By not providing that information UC is not being forthcoming with data again, just as it has by refusing to release its groundwater study.

Ohioans deserve a full explanation as to why a study that generated numerous alarmist headlines by promoting fear was retracted. It will also be interesting to see if the retraction gets as much media attention as the flawed study generated.

But, considering Ohioans are still waiting for UC to release its groundwater study (which cost taxpayers $400,000, by the way), it might not be a good idea to hold your breath on that.

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Member Spotlight: Jonathan Hudson, Appalachian Well Surveys

Posted By Lyndsey Kleven, Communications Coordinator, Tuesday, June 28, 2016

The member spotlight series features legacy OOGA members who have been a member of the Association for at least 10 years. If you would like to recommend someone to be highlighted, please contact Lyndsey Kleven lyndsey@ooga.org

 

Background information:

 

Jonathan (Jon) Hudson was born and raised in Guernsey County, and has stayed around the area his entire life. He started college at Zane State College (formerly Muskingum Technical College) in the late 1970s, transferring to Marietta college two years later to finish his degree. Jon had no family ties to the energy business and originally started college to become a civil engineer. While dating a girl from New Concord Ohio, whose brother-in-law worked for an oil and gas company, Jon was able to get a summer job that lasted throughout his college career.

 

“An old man told me, once you get oil on your boots you’ll never get it off. So I’ve never taken the oil off my boots. And it’s been boots on ever since,” Jon remarked. 

 

After his first summer working the oilfields, Jon switched his major to petroleum engineering and graduated in 1982.

 

“The more you get into this business, the more it sucks you in. Every summer that I worked was something different. The next year I got to work with folks on leasing property. The year after that we worked in oil field solvents. The more experience I got, the more I enjoyed it. The more people I met, the more they sucked me in too. The people in the industry are a very unique breed of people—and it’s a brotherhood. You aren’t going to find too many people that’s any closer then the oil and gas industry.”

 

Jon’s first job after college was working for Marathon Oil Company in Bridgeport Illinois. Following that year, Jon decided to return back to Ohio and started working for Eastern Well Surveys, an independent wireline company in Wooster that he stayed at for another year. Bringing him full circle back to Cambridge in 1983 was Sego Services, a start-up service company. Jon worked at Sego Services through 1986, which was a time when the industry started to really take a downturn.

 

“Then I get this genius idea that I was going to go into business for myself.”

 

Appalachian Well Surveys Overview:

 

Jon had several years experience working in the service business and was able to see that everyone had a unique way of doing things. Starting a business in April of 1987 as the industry was facing a tough time was an added challenge. After fully deciding that’s what he wanted to do, Jon visited his banker and shared his ambitions of getting into the wireline business.

 

His banker said, “Jon if you’ve got enough guts to get in this business right now, I’ve got enough guts to lend you the money.”

 

Jon knew of a company in Texas that was facing financial struggles with 130 wireline trucks to sell. He went to the auction in Texas and bought one of the trucks and drove it back to Ohio.

“It scared me to death because I had never driven a diesel, everything I had driven was gasoline. Here I am traveling 1,000 miles with a diesel I’d never driven before and away I went.”

 

Arriving back on a Friday, Jon had already set up his first job to perforate a well with Doug Gonzalez the following Tuesday—officially starting his business, Appalachian Well Surveys (AWS). Having been able to find work quickly, Jon still recalled how tough it really was starting out at this time. The company was in debt, the industry was doing poorly and there was a good amount of competition with many other well established wireline companies in the area. 

 

“It was really rough to get started during that time, and I would not wish that on my worst enemy. The first ten years were the ugliest ten years I ever had in my entire life. Just because the industry was tough and the prices were down. If you can get through that first ten-year hump, which is so critical for any business, you’re usually going to make it through then.”

 

It required two people to man a truck, so starting out it was Jon and one other employee. After the first year they went back to Texas and bought another truck and hired two more employees. As AWS was picking up more business they started running two stations, one in Ohio and one in Pennsylvania. In its third year they felt they knew what they were doing and Jon decided to expand into the open-hole business. The first two trucks were cased hole trucks and the newest truck was a logging truck. Jon described open-hole as an experience, dealing with radiation that brought with it a realm of federal regulations.

 

Around 1994 the industry started picking up and the commodity prices started to climb. Companies started to drill more which created more work for the service companies. It was also during this time that a good amount of Jon’s competitors (some of whom were older) started to sell out, creating less competition.

 

“As small as we are, we know what our limitations are. We knew what the industry needed in our Appalachian basin and we provided the tools that were used everyday, afford to buy and enough to keep us busy.”

 

Through the late 1990s is when the company had its biggest growth spurt with a total of ten employees. Over the years Jon has considered his staff family. Up until the latest downturn AWS consistently had 13 employees. The latest downturn forced the company to downsize, which was one of the toughest things Jon had to do in his nearly thirty years in business. Jon is an optimist that the industry will eventually rebound and he will be able to bring back his former staff. He is also optimistic in achieving status of being the oldest wireline company in the history of the Appalachian basin. In five more years AWS will surpass Jon’s former boss Bill Musselman’s tenure at Easter Well Surveys, which was in business for 30 years.

 

Horizontal drilling and state of the industry:

 

Looking at the current state of the oil and gas industry, the biggest changes Jon has seen over the years have been technological. He feels the basics are still used but the technology being used today has changed twofold.

 

“We know all the basics but this new age of drilling is amazing. How we’re getting the product out of the ground, more efficiently, with less of a footprint, it just amazes me—and it’s all for the good. I am working with young engineers that are educating me on the new technology.”

 

The new technology has been a cause for new regulatory changes, which Jon feels, overall, is a positive for the industry. It is a challenge, costing more money (especially now) but Jon feels it is important to make sure procedures are done right. And Jon feel’s there isn’t one person on the OOGA Board who wouldn’t agree—he says, if we’re going to preach, we’ve got to practice it.

 

The last few years has caused AWS to re-evaluate its outlook because of horizontal drilling, which has caused vertical open-hole operations to slow dramatically. AWS has purchased some new tools that are standard of the new drilling operations. This has brought the company some work in the new era, but Jon’s motto has always been to keep things simple and not get pushed out of his comfort zone. 

 

History with the OOGA:

 

Jon has been a member of the Ohio Oil and Gas Association for more than two decades. Jon credits the Association as being very instrumental in the mid 1990s to helping keep many of the independent companies in Ohio in business.

“They did everything they could to listen to our problems, and it’s no different than it is today. The industry was really, really working together. I think the industry in itself, as long as you’re progressing and positive, those guys were there to help you,” Jon recognized.

As AWS became more established Jon was able to take on a more active role within the Association, which he attributes as being built around a strong foundation of brotherhood. In 2014 Jon was elected to the Board of Trustees, a role he currently holds today. Jon happily mentioned the comradery among the group, saying the majority of the board are his customers and he is always given the chance to bid on work.

“Being on the board, you get a more well rounded background of what all the Association is really doing out there to fight for our industry. And we need a strong taskforce like that to tell the truth.”

The guys that keep Jon going are the old-time, legacy members that uphold a positive attitude, regardless of the state of the industry, with a passion to “drill baby, drill.”

Having been involved with the Association for the long hull, Jon has seen its evolution over the years. New board members with interest in different drilling techniques have gained board seats as the industry has changed. Jon says Tom Stewart has been one of his all time favorites, and appreciates his tireless dedication to the industry and drive to instill this attitude among other board members—many of which are constantly going over and above their responsibility.

“All we’re trying to do is find energy for people. And we’re trying to do it right. And we have some of the sharpest cats on the block, bar none.” 

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