SHALE Oil & Gas Business Magazine - Industry - Jan/Feb 2017

SHALE JAN/FEB 2017

OIL & GAS BUSINESS MAGAZINE

ANNUAL WOMEN’S EDITION

WOMEN IN ENERGY 2017 WEN NATIONAL CONFERENCE PANELISTS SOLUTIONS TO OKLAHOMA’S EARTHQUAKES CONTINUE TO EVOLVE CAN THE GOVERNMENT BE RUN LIKE A BUSINESS?

KAREN HARBERT WHEN PREPARATION MEETS OPPORTUNITY

JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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SHALE OIL & GAS BUSINESS MAGAZINE ď “ JANUARY/FEBRUARY 2017

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o m m u n i t y

2-gether

JANUARY/FEBRUARY 2017

CONTENTS FEATURE

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Women in Energy

COVER STORY

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Karen Harbert’s impressive background prepared her for the role of President and CEO at the Institute for 21st Century Energy. She shares her experience and insight into Washington, D.C. and energy policy.

INDUSTRY

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2017 Womenʼs Energy Network National Conference

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Dakota Access Pipeline: A Key Struggle in a Much Larger Fight

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An Eloquent Warrior in the Mad War on Energy

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American Energy Needs Women – On the Job and Raising Their Voices

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STEER: Fourth Annual Eagle Ford Excellence Awards

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PESA High Perfomer Spotlight

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How to Rethink Flaring

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Solutions to Oklahomaʼs Earthquakes Continue to Evolve

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COVER AND TABLE OF CONTENTS PHOTOS COURTESY OF KAREN HARBERT

POLICY

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The Boys Club Is Going Out of Business

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Can the Government Be Run Like a Business?

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In Colorado, Energy Critics Face Tough Choices

COMMUNITY

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SHALE OIL & GAS BUSINESS MAGAZINE  JANUARY/FEBRUARY 2017

JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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 FEATURE

WOMEN IN ENERGY What does your typical day at the office look like?

No two days are the same, but overall my days are about our internal communications as much as marketing.

My focus is on creating clarity, consistency and alignment on how we talk about what we do across our internal and external stakeholders.

What do you like most about your position?

I like the variety and touching every part of the business.

It’s exciting to get to know the breadth of what we do as an organization. I enjoy the challenge of taking complex ideas and trying to communicate them effectively to different audiences. It’s great to be able to work on the creative side of our organization and think about what is interesting and compelling to our various stakeholders.

What interested you in entering your industry?

Now this is interesting, because I didn’t intend to get into the oil and gas industry. I was always interested in technology, computers and the technical aspects of things.

When I graduated from university with a philosophy degree, I lived in Cambridge, which at the time was Britain’s “Silicon Valley” with a lot of small high-tech startups.

I went to work for a company of seven employees that was the first company in the world to put oil and gas data on a CD. It was a jack-of-all-trades kind of job, and I started learning the data management and data analysis side of oil and gas. The company ended up being bought by Landmark shortly after Landmark was acquired by Halliburton. It’s funny ... I thought I was working for an agile little tech startup and found myself at Halliburton. The real reason I’m in oil and gas today is because my first boss told me, “Your degree tells me you know how to think — I’ll teach you the rest.”

NAME:

Susanna Sabbagh COMPANY NAME: Halliburton JOB TITLE: Director, Global Marketing & Communications

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SHALE OIL & GAS BUSINESS MAGAZINE  JANUARY/FEBRUARY 2017

What about your career makes you most proud?

I’m proud that I have been successful in a variety of roles without coming from a traditional oil and gas background.

What has helped me and has been valuable to the organization is my ability to bring a different perspective as we assess how we do things.

I’ve turned what could have been seen as a weakness into strengths. While I didn’t start in the field and I’m not an engineer, I’ve worked across many different aspects of our business and have a diverse background, which gives me the ability to bring together the different threads of what we do to drive success in many areas.

What advice would you give to young women interested in your industry?

It’s the same advice I would give young men — be openminded to where your career can go, be willing to try new things and don’t limit yourself.

public then votes on which organization receives different levels of funding. In the program’s first year, we touched more than 120,000 lives.

What do you like most about your position?

In my role, I am fortunate to work with so many different people in so many different capacities. Each day includes a combination of times when I am advising others and times when I am learning from others. I appreciate working in an environment where learning and development is continuous.

I also deeply enjoy our company’s culture of giving back to the community. We get to be the hands and feet that make a difference in the communities where we live and work.

Whether that is volunteering at a local nonprofit, sponsoring a community event or donating to organizations that make a real difference in someone’s life, I am blessed to be leading a company that commits to giving back to communities that mean so much to our employees, their families and our customers across the country.

NAME:

Elizabeth Killinger COMPANY NAME: Reliant and NRG Retail JOB TITLE: President

What does your typical day at the office look like?

As President of Reliant and NRG Retail, I help power, protect and simplify life for consumers throughout Texas and the Northeast. Most days consist of time spent with internal and external teams — articulating my vision, discussing progress on an initiative or receiving an update on business performance.

Depending on the day, I spend time on everything from business operations and customer experience to marketing and public relations, to mentoring or listening to employees and customers.

It’s also a privilege to be out in the community. Not only do we have a robust employee volunteer program, we also regularly partner with various community organizations to help reach our customers in different ways. Last year, we launched a new program called Reliant Gives, which enables our employees, nonprofits and the public to direct our charitable spending. In this program, our employees nominate nonprofits that matter to them and their communities. The

What interested you in entering your industry?

If you had told me when I was in college that one day I’d be president of an energy company, I would have said, “No way!”

Starting out, I imagined I’d follow my mom’s path of being a homemaker, but I ended up following my dad’s footsteps and getting an education in business and management information systems. Working as a Management and Systems Consultant, I was focused on building strong teams and helping companies find ways to improve their strategy, execution and customer satisfaction. When I started working at Reliant around 16 years ago, I was a Consultant helping the company navigate the transition to the competitive electricity market. I soon discovered a passion for the energy industry and a desire to grow and run a business. I was asked to join the company as an employee and made the transition from consulting to the energy industry in 2002. The industry is constantly growing and innovating, and I love being part of one that literally powers life as we know it.

That keeps me challenged and focused on creating a brighter future for both today and generations to come.

What about your career makes you most proud?

I have a real passion for developing our people by giving employees the opportunities and support they need to be successful. If an employee starts in customer service and they have a desire to work in marketing, I want them to have that opportunity, and I want our company to be the kind of place where people can have a robust career. Numerous people on my team have had the opportunity to work in multiple divisions and leadership roles, fulfilling their career aspirations.

Ultimately, I aspire for Reliant and NRG to be a company where our children can also have robust careers in leading the next generation of personalized energy solutions.

What advice would you give to young women interested in your industry?

Be the CEO of the job you have now. Doing your current job as well as possible is the best way to succeed as an individual contributor or to move up in the ranks. This is also the best way to become an asset to your team, your boss and, ultimately, your company. I have learned from experience in management consulting to always look at issues from one level up and then make decisions based on what’s best for the organization — not just my personal division or ambition. When management sees you can take a company-wide approach, they’ll see you are leadership material and will count on you to make a positive impact to the business bottom line.

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COVER STORY

Karen Harbert: By: David Blackmon

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SHALE OIL & GAS BUSINESS MAGAZINE  JANUARY/FEBRUARY 2017

PHOTOS COURTESY OF KAREN HARBERT

When Preparation Meets Opportunity

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So says Karen Harbert, President and CEO of the Institute for 21st Century Energy at the U.S. Chamber of Commerce. She’s discussing some of the challenges of being a woman in what has been a mostly male-dominated world of energy, a world that she has played a significant role in shaping throughout an accomplished career that began with an assignment at the Republican National Committee (RNC) upon her graduation from Rice University in 1988.

“And I think things are beginning to change in the energy industry: We certainly see more women in the C-suite,” says Harbert. “On the other hand, I don’t think we see enough women on boards. That’s probably across all business areas, but particularly in the energy industry, and I hope that does continue to change over time. But it is less about bringing people in from the rigs and up the headquarters ladder; the industry becomes more open to women as it evolves into more of a high-tech industry. So, it’s changing, and for me it meant doubling down and making sure I was well-prepared. But also, it’s about kicking

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the tires a little bit and letting them know us women can do this too.”

TAKING THE ROAD LESS TRAVELED Legendary University of Texas Head Football Coach Darrell Royal, when asked by a reporter if he felt like his team had gotten “lucky” following a hard-fought win, famously replied, “‘Luck’ has nothing to do with it. ‘Luck’ is what happens when preparation meets opportunity.”

By Coach Royal’s standard, Karen Harbert has been a very “lucky” person indeed. Her lifetime of preparing to take advantage of opportunities when they have presented themselves began with a decision to leave her hometown of Washington, D.C. for college.

That decision led her to Rice University, a highly selective school with fewer than 3,000 students located in Houston.

“I was born in Argentina, but my formative years were here in Washington, Harbert states. “[When it came time for college] I wanted to get out of Washington to do my studies.

I had always been close to politics here in

SHALE OIL & GAS BUSINESS MAGAZINE  JANUARY/FEBRUARY 2017

Washington and I knew that was going to be at least a part of my future, but I felt it would be beneficial to get out of here and see things from a different point of view.

“And choosing to go to a university in Texas was great, because I was able to be exposed to politics in Texas, which is a different kind of politics. I can remember being at Rice when Ronald Reagan came to Houston (during the 1984 campaign), and some friends and I went to his event there. That left a very big impression [on] me about the type of man he was, the type of leader he was and his passion for making sure that he connected with younger people.

“When I finally did begin homing in on my major at Rice, I ended up selecting political science. But I added to it a focus on international policy, because I was born in Argentina and always had a passion for international issues. And when I had to select a major in that international policy portion of my degree, I chose Russian nuclear affairs. That was because we were in the midst of the Cold War, and I was fascinated with how Reagan

PHOTOS COURTESY OF KAREN HARBERT

“There are many, many times when we sit around a table and I’m the only one in heels. And it doesn’t go unnoticed. So I always wanted to be very confident of the facts and prepared in what I was going to say, because you don’t want to be dismissed. That’s true in any meeting, in any setting; however, it was very true in my earlier years. I think that once you prove your muster, you are given equal time and equal confidence.

But it is true: You do have to prove it; you do have to earn it, not unlike in anything else.”

was handling it. I wanted to know more about it so I could be more fluent on it and possibly focus on it upon graduation.”

As “luck” would have it, upon graduation, Harbert moved back to Washington and immediately got a job working for President Reagan’s daughter, Maureen Reagan, at the RNC headquarters. “After the election was over and George [H.W.] Bush had been elected to the presidency, Mr. Reagan was kind enough to invite our whole office to come to the Oval Office during the transition for a sort of ‘goodbye and thank you’ meeting, which included having lunch in the White House Mess,” Harbert recalls. “I’ll never forget, there was a gentleman out in the hallway holding a big American Indian headdress — which he had come to present to the President as a going-away gift — and it turned out to be New Mexico Sen. Pete Domenici. And of course, Sen. Domenici is literally the father of so much of our national energy policy. That was a great opportunity to meet President Reagan finally.”

But it wasn’t the first time she’d had the chance to exchange words with President

Reagan: “I had spoken to him several times before because, as one of the junior people in the office at the RNC, you had to answer the phone when it rang. I can’t tell you how many times he would just call and say, “Hi. Is my daughter around?” It’s the President of the United States on the phone, oh my goodness!

Don’t disconnect him! And that would be the stress — making sure I pushed the hold button right and connected him correctly.”

She obviously handled that stressful situation and her other duties at the RNC well. Within a few months, shortly after Mr. Reagan’s term in office came to an end and the presidency of George H.W. Bush began, Karen seized another opportunity, this time with the U.S. Agency for International Development (USAID), where she worked in several developing nations in Latin America.

Harbert recalls, “When he [Bush] won, I joined USAID and worked in Latin America,” which made sense since Spanish is her first language. “Anyplace you would never at that time go to on vacation, I was working on: Haiti, Nicaragua, Bolivia. And I got a very early

exposure to the developing world, and to the causes and effects of poverty.”

It was in that assignment that Harbert began to witness and understand the relationship between the availability of reliable and affordable energy and economic prosperity. It is on this direct cause-and-effect relationship that she has worked to solve in her career ever since. “I worked there for four years, and that led me to pursue the next stage in my career, which was to work in Latin America again, but this time on strengthening the democratic institutions in these countries so they could be more stable and ultimately achieve economic growth,” she states. “Because it had become very apparent to me, particularly in countries dominated by corrupt governments, that there was far less opportunity to achieve economic growth than in other countries.

“So I worked for four years on democracybuilding and came to the conclusion then that the real cause of some of these discrepancies in growth and income and success of countries was really the lack of energy and a lack of infrastructure. Because if a country —

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PHOTOS COURTESY OF KAREN HARBERT

Harbert’s discussing some of the challenges of being a woman in what has been a mostly male-dominated world of energy, a world that she has played a significant role in shaping throughout an accomplished career

or to take it to a lower level, a community — had access to energy then kids could study at night, people would get off the streets, there was more work, crime went down, opportunities rose, women were being contributors as were men. It was really the common denominator to the previous 12 years of my life.”

These years of preparation allowed Harbert to seize on the next opportunity that came forward, this time in private industry: a global assignment in which she helped lead the development and installation of power projects. “I worked next not just in Latin America, but all over the world in countries like Pakistan, Colombia and others, this time in the private sector on developing power projects,” she says. “I was the only non-engineer in this company, and the reason they hired me was because I had worked in the developing world and could speak, sort of, “government speak” while they spoke “engineer speak.” I did this for a little over 10 years, and during that time we successfully developed more than $9 billion worth of energy infrastructure.”

But the administration of George W. Bush soon came calling, with a chance for Harbert to return to USAID, but this time with a much broader portfolio of responsibilities for which she was again extremely well-prepared. Her luck was holding. “Next, I wanted to get back into government and apply this experience there,” she explains. “I went back to USAID and tried to get them to focus more on energy and the structural problems of poverty. I wasn’t able to get them to do that to the extent I thought was necessary. But I did run a lot of other programs. I did all of the counter-drug work in Colombia and was in charge of several other projects in countries like Venezuela and Haiti.

I was in charge of all of South America and the Carribean, all the time with a passion toward trying to get the agency to focus more on energy.

“That led me to the Energy Department, where I was able to put all this experience into action both domestically and internationally.

And that ultimately led me here, and my current focus on policy development and advocacy. So, it looks stranger than maybe it is. I’m not saying I planned it all this way, but it has been a process in which every step along the way I have been able to apply the lessons learned in the past.”

Coach Royal would have been proud to see his philosophy on making one’s own luck carried out so clearly and precisely in a highly successful individual’s life. But for Harbert, it has been about more than just being prepared — it’s also been a process of doing things her own way, setting herself apart from the crowd and taking on assignments less for career development and advancement than for allowing her to find ways to continue to address the problems for which she developed a passion to solve early in her career: “Every time a decision point came, I took the path less traveled,” she says. “And I’ve had all of these interesting experiences that have led to a productive career. I didn’t just go to law school and end up here because I was a good environmental lawyer. I’ve been out there and seen it all, and brought all those experiences with me on the way to trying to solve the problems I saw early on.”

And as a result, Harbert says she has “sat in all the chairs necessary to be in my current job. I have been in government; I have been in the private sector; I have been in a nongovernmental organization [NGO]; and I have worked in an international organization, a subsidiary of the UN, which is important in the energy picture. So, having sat in all the seats at the table, I understand how important they all are and that, while the private sector is ultimately the driver of many of these things, all the other factors have to fall into place to make them work.”

So, what does that mean to the layman out there? “You have to have the right policy environment; you have to have good relationships with the NGOs that are representing concerns of communities and citizens; you have to be able to have strong advocates, you have to know which international rules you’ll be subject to. So, I do have a unique understanding — I didn’t just work in the energy industry for 20 years and then decide I wanted to get into public policy.

“Of course, now I find myself worrying more about Toledo [Ohio] than I do about Turkmenistan.”

Is worrying about Toledo a little simpler for you? “It’s a little less travel.”

No doubt. Not that that’s ever been a problem for Harbert before.

RAISING KIDS IN AN AGE OF HELICOPTER PARENTS As an increasing percentage of women have made the choice to be working mothers over the years, many stories have been written and broadcast about the challenges for them and their families. In a career involving as much travel as Harbert’s has demanded, such challenges can be daunting, especially with a husband whose own career has also been travel-heavy. But both are gifted problem-solvers, so they have found ways to compensate and cope.

“I did get married late because I was traveling all over the world and doing crazy things. I was lucky to meet my husband, who was in a similar line of work in the democracybuilding business. He was in Asia, I was in Latin America, which proved to be a little ‘globally challenging.’ But we got married when I was 32, which is later than some, and we didn’t have kids for a little while because of the pressures involved in our work.

“I am certainly not going to tell you that having a fast-paced career and having a family was easy; but, at the same time, I think our kids have been exposed to things that other children haven’t been. Whether that makes them better or not, I guess time will tell. But they’ve always had a working mother who was going to very interesting places doing very interesting things, and as a result we have had great dinnertime conversations.”

Does it get any easier as the kids grow older? “Actually, I will say that at one point, after I left the [Department of Energy], I realized it’s easier to be really crazy-busy when your kids are really young. That may sound counterintuitive, but if they just need to be fed, changed and supervised, it doesn’t necessarily always have to be you. But as they get older and the issues get different — right now my kids are 11 and 15 — it is fortunate that I am now on the road less and have more flexibility in determining my schedule than I did when they were younger.

But things have been challenging at times.

“For example, I missed my son’s first day of kindergarten. But you try to make up for those things in different ways. Making sure you are there whenever possible — and certainly, one of us was always there. And now as they’re growing up in a world in which social media is ever-present, you have to be more vigilant.

“On the positive side, I think my kids are able to talk about what’s going on with the election much more fluently than many of their peers are able to do. They can talk about what’s happening in some of the parts of the developing world in ways that some of the

other kids aren’t able to do. So there’s benefits, there’s challenges, and, you know, we live in an age of helicopter parents, so I hope that in some ways it [having such busy parents] will make it better for them.”

MAKING ENERGY POLICY IN A TOWN WHERE CONGENIALITY IS A RELIC OF THE PAST Having spent her formative years in Washington (her family relocated there when she was in sixth grade) and then returning there to spend most of her career, Harbert has witnessed a sea change in the culture

shame, because Tip O’Neill was able to do that on the weekends, and then he’d end up in Ronald Reagan’s office on Monday saying ‘I think we got us a deal, sir.’

“But we’ve gotten to such a different place as things have evolved. Certainly, as you move into a 24-hour news cycle, with constant social media, if you went out and played golf on the weekend with someone (from the other party) it would be all over CNN before you got to the third hole. And then you’d be having to go tweet about how it was a good thing in response. So, it is a very different environment.

Think about what it would be like if you had a company of 535 people and none of them

As politics in the nation’s capital have become increasingly partisan, it has made the making of good public policy far more difficult that exists among policymakers in Congress and the executive branch of government. As politics in the nation’s capital have become increasingly partisan, it has made the making of good public policy far more difficult.

“Growing up, my family belonged to a country club here, outside of the city — in Maryland — which was frequented by many members of Congress,” she explains. “This was Congressional Country Club. I can remember being a lifeguard out there in the summer, earning my spending money and seeing [Democratic Speaker of the House] Tip O’Neill there on the weekend playing golf and bringing a fellow Democrat and two Republicans along. And their spouses would come out and go to the clubhouse to play bridge or other activities. Then they’d all meet up for lunch or dinner together afterward.

“When I think about that back in the late ’70s and compare it to today, when members of Congress don’t spend the weekend here, many don’t bring their spouses to D.C. to live, so nobody ever gets to meet anybody. Well, it’s really a lot easier to make deals with people who you know, who you have some sort of relationship with. You don’t have to ‘like’ them, but that there is some sense of camaraderie, even when you don’t agree with each other, or at least a sense of congeniality. That certainly is clearly missing today. And I think that’s a

knew each other; you certainly wouldn’t be achieving the same bottom line that you would if they all knew each other.”

Good point. When we asked about what, if anything, can be done to make the situation better, she pauses, smiles and replies, “Someone said the other day that what we should probably do is take out the air conditioning from the Capitol building, because if there were no A/C they’d go home all summer and do other things rather than being here.”

Certainly, that couldn’t hurt. We next asked how the disappearance of congeniality in the nation’s capital has impacted the making of national energy policy over the years. “If you go back to energy policy under Bush Sr., George W. Bush, and President Clinton, energy policy was dominated by regional divisions.

Energy policy for the West Coast was different than what was useful for the Southeast. The Southeast and the Northeast were more interested in pursuing nuclear, while California and the West Coast were more interested in renewables. Meanwhile, Texas, Oklahoma and the middle of the country [were] more focused on oil, gas and coal. That’s the way it used to be, but now it is sharply divided among the two parties. One that sees itself as ‘proenvironment’ and one that thinks of itself as ‘pro-energy.’” 

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INFLUENCING ENERGY POLICY: WORKING FROM THE OUTSIDE IN The strategies for influencing public policy have shifted over the decades as the partisan atmosphere in Washington has intensified. This shifting playing field has required organizations to find creative ways to make their mark on the legislative and regulatory processes. Not surprisingly, Harbert and the Institute for 21st Century Energy have been at the forefront of developing new strategies for effective advocacy.

“We certainly do the traditional advocacy thing of visiting on the hill, letting members know how the chamber feels about certain issues impacting the energy space. But I have to say that, as time has gone on, effective organizations are focusing more time out of Washington rather than expending shoe leather walking the halls of Congress. They’re going

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“I have to say that, as time has gone on, effective organizations are focusing more time out of Washington rather than expending shoe leather walking the halls of Congress.” into congressional districts. They’re working with their local memberships.

If a member of Congress gets a visit in a district office from a local business saying, ‘Mr. Congressman, if you vote for HR-1234, I’m going to have to lay off 12 employees,’ he or she listens. But if somebody walks into the office here and says, ‘You know what, I think your district is going to suffer,’ he or she has no frame of reference. So many organizations, including ours, are working with our local chambers and members, getting them up to speed on the issues, getting them to communicate with policymakers in the places in which they work and live.”

What about the regulatory side of things? “The regulatory side of the business has dramatically changed during this administration. In the good old days [pre-Obama administration], you could sit down with your regulator and say, ‘I know where you are trying to go with this regulation.

Let me try to show you how it is a little misguided, and how it’s going to affect me.’ And the regulator might say, ‘Oh, that’s an unintended consequence. Let’s fix that before the rule goes final.’

“Today, there is no consultative process. So, you have to be far more diligent in the rule-making process, in putting in a lot more detailed information in your formal comments. You have to do your own economic modeling showing how this regulation might impact your industry; it’s a lot more expensive to do this. But you have to get this information into the formal record in the hopes your issues might be addressed.

“And you have to do this very hard work in preparation for litigation, so that in the court system you can prove your concerns are real, that

PHOTOS COURTESY OF KAREN HARBERT

Do you think any of that will change in the Trump years? “I think that when history writes about the Trump presidency, it will be both.

Because the type of energy policy people want to see pursued and what the market reality is, is that hopefully by easing some of these heavy regulations on fossil fuels and ending endless amounts of grants, loans and subsidies for renewables, we will then be relying more on the market. And the market tells us we need everything. Things will then be more affordable, we will have a more diverse industry and hopefully an industry that can thrive in this country, which will make us more competitive around the world. So, I think that you’re going to see that some of these strangling regulations that the Obama administration has been rushing to get out the door will be peeled back.

I do not underestimate how difficult that can be: It can take years, as in more than one, sometimes more than two, to redo and put forward a replacement regulation. But I think there is enough enthusiasm to do that that people will be serious about it and stick with it.”

Speaking of partisan behavior, what about the departure of Harry Reid?

Since assuming the role of Democratic leader in the U.S. Senate, retiring Nevada Sen. Harry Reid has without a doubt played a big role in taking the partisanship in the U.S. Senate to a new level. During the 10 years in which he has been the party’s leader in the Senate, Reid’s efforts to obstruct the budget process have been largely responsible for the fact that Congress has failed in all but a single year to enact an actual federal budget, running the government instead on a series of continuing resolutions.

Couple that with Reid’s propensity for unnecessarily inflammatory rhetoric in his speeches in the Senate chamber, and we wondered if Harbert believes there may be an opportunity for improvement under the new leadership of New York Sen. Chuck Schumer. She says, “Sen. Reid has certainly exemplified partisan behavior at its highest level. He was majority leader when I was up for confirmation, and my confirmation vote was held up for many months as he put me on hold in order to advance a nominee he wanted for a different position.

“That sort of thing used to be quite out of the ordinary, and now it is part of the daily diet — on both sides of the aisle. But Reid certainly mastered it early on. It would be very difficult to see how, if he were to remain in a Trump presidency, his type of behavior would play. We will have to see how Sen. Schumer emerges as a leader. He has in the past been willing to do deals, but he is in a position now with a party that is down and out, and I think his supporters will be looking to him to be disruptive of the Republican agenda.

“There is going to be a lot of politics, because there is another election in 2018 and his party has a lot at stake in that election. [The Democrats will be defending 25 Senate seats — more than half of their 48 members — in 2018, and the Republicans only eight.] He has to figure out how to protect the members he wants to protect; how to prevent them from having to take hard votes, how to let them take the votes they want to take. And that puts them right back in the Harry Reid category if that’s the kind of politics they want to play. But we’re at the beginning of a new Congress, and I hope it will be a new start. I think there is common ground on infrastructure, of which energy is a big piece, but we have to wait and see. If there are areas we can work together with Sen. Schumer on, we will do it.”

they were not addressed in the rule-making process, that your industry is being harmed, and that this rule is not fair and equitable. So, the rule-making part has become much more of an issue in the Obama years, because they have chosen to use this process as a substitute for legislative activity.”

Again, there is that theme of preparation meeting opportunity, even for the opportunities you’d rather not have to address.

21ST CENTURY ENERGY PRIORITIES FOR A NEW ADMINISTRATION In closing, we asked Harbert about the Institute for 21st Century Energy’s legislative and regulatory priorities for the upcoming session of Congress and the Trump administration. To no one’s surprise, she’s already planning to seize the opportunities to come.

“We certainly want to get the siting process for LNG facilities simplified. It’s too complex and time-consuming and there are plenty of opportunities there. We are going to go all-in on the REINS Act [Regulations from the Executive in Need of Scrutiny Act], because that will reform the regulatory process. It is important in any administration to have a regulatory process that makes sense and works for the American people. Right now, Congress is considering the REINS Act, which says that if you’re going to have a rule

of significant economic impact, Congress must vote on it. That would enforce a level of transparency and accountability that we have not seen in recent years, and that’s what we need to restore.

“The Obama administration has been ruling via regulation rather than through the legislative process and transparent debate. Restoring that and preserving it for future presidents will be very good for the business community. So we are very hopeful we can get the Reins Act passed in the new Congress.

“We plan to focus more on the agencies themselves in the beginning of the administration to see how we can get some of these bad regulations repealed. And there are some regulations that were finalized during the last few months of the Obama administration that Congress can repeal as soon as they get in, particularly the midnight regulations that are coming out right now during the transition period.”

We asked Harbert if she thinks a significant effort around tax reform is going to happen in 2017. “Time will tell,” she says. “I think there will be, but I don’t underestimate how hard it will be. Because if you want to look at the best way to meet the needs of the middleclass voters who put Trump in office, they’re looking for more job opportunities; they’re looking for an improved economy; they’re looking for ways to improve themselves.

They’re not looking for handouts; they’re not looking for welfare.

“To do that, we have to grow the economy; and to grow the economy, we have to make businesses more productive, and to do that, we have to lower taxes. So, I think they’ll be looking at lowering taxes; they’ll be looking at ways to move money back into the country, to have companies repatriate their profits and to use some of those to fund infrastructure programs. They’ll be looking for ways to stimulate the economy without resorting to massive handouts, and tax reform is high on the agenda.”

If you think that all sounds complicated and very difficult, Harbert agrees. “It is going to be difficult. Our tax code is more complex than people can even get their head around; and all industries are, to their credit, going to want to preserve their own little carve-outs. So it’s easy to say we’re going to do tax reform, but it’s another thing to do it.”

One thing that we have learned from how Karen Harbert has conducted herself throughout her fast-paced career is that if an opportunity to weigh in on a major tax reform effort (or any other relevant issue) presents itself in the coming years, she and the Institute for 21st Century Energy will be well-prepared to take advantage of it.

And “luck,” as Coach Royal would say, will have nothing to do with it.

About the author: David Blackmon is Associate Editor for Oil and Gas for SHALE Magazine. He previously spent 37 years in the oil and natural gas industry in a variety of roles, the last 22 years engaged in public policy issues at the state and national levels. Contact David Blackmon at david.blackmon@shalemag.com.

JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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2017 Women’s Energy Network National Conference Special to SHALE

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he 2017 WEN National Conference will be held April 26-28 at the brand-new Marriott Marquis Houston. The WEN National Conference will bring together over 500 participants from multiple disciplines in the

energy industry and across the country. The conference will showcase relevant and timely topics around the theme, Energy Resilience: Refueling Innovation.

As part of this conference, attendees will have the opportunity to view a panel

discussion featuring three energy executives with unique backgrounds and viewpoints.

Elizabeth Killinger, NRG Retail and Reliant; Jody Markopoulos, GE Oil & Gas; and Cynthia Warner, Tesoro, will share insight into the energy industry with attendees.

Meet the 2017 WEN National Conference Panelists:

Elizabeth Killinger President, NRG Retail and Reliant

Elizabeth Killinger has 25 years of domestic and international experience in the energy and services industries, including 15 years with the company. She is now responsible for directing all aspects of NRG Retail, a $5 billion competitive energy company that includes the largest national competitive electricity business in the country, the largest multibrand retail electricity business in Texas, the third-largest residential retailer in the Northeast, and the leading portable solar and power business in the U.S. NRG’s Retail businesses provide electricity, natural gas, home solar, home security, portable power and other innovative energy solutions to about 3 million homes and businesses and there are 3 million of its portable solar, power and battery products in use by consumers around the world. Having played a key role in the company’s transition to competitive electricity markets with customer

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service at its core, her vision of the “Era of Personal Power” has led NRG to introduce new innovative products that push the energy industry into the future and provide consumers with insights, choices and convenient ways to power their lives at home and on-the-go.

Ms. Killinger spent the early days of her career in the oilfield services, software development and management consulting industries. She started her NRG career at Reliant in 2002 after working for two years as a consultant, helping prepare the company’s wholesale and retail businesses for electricity deregulation in Texas. Since then, she has taken on increasing responsibilities year after year, including the launch of several successful startups within the company.

Deeply committed to making a difference for future generations, Killinger serves many impactful organizations.

She is on the Energy Advisory Board and the Bauer College Board at the University of Houston and serves on the board of directors for the March of Dimes, The Center for Hearing and Speech, the North Texas Commission, and the Greater Houston Partnership (GHP) in addition to being on the GHP Executive Committee. She also serves as School Board Vice Chairman for Epiphany Lutheran School and is an advisory board member for the Newspring Center for Social Entrepreneurship and Business Nurturing. Killinger served as Chair for the nation’s largest March for Babies campaign in 2014 and Chair for the 2015 American Heart Association’s Heart Walk. She was recognized as the Platts Global Energy Rising Star in 2016.

Killinger attended Houston Baptist University and earned her bachelor’s degree in management information systems from the University of Houston. She is also passionate about her role as wife, mother and homemaker, and enjoys spending time with her family.

Jody Markopoulos

Chief Operating Officer, GE Oil & Gas Jody Markopoulos is Chief Operating Officer at GE Oil and Gas. The company is a leading manufacturer and provider of advanced equipment and services for all segments of the oil and gas industry, from exploration, extraction & production to end use.

Markopoulos was appointed to her current role in October 2015, where she is responsible for sourcing, manufacturing, materials, quality, Environmental Health and Safety (EHS) and global projects worldwide. She works across GE to leverage capabilities, technologies and efficiencies to deliver products and solutions in a customer-centric organization. Prior to moving into her current position, she was Vice President of Global Sourcing for GE Oil & Gas managing strategic sourcing operations of $10 billion of material and services. Before joining GE Oil & Gas, Jody also served as President and CEO of GE Intelligent Platforms, a $1 billion high-performance technology company and a global provider of software, hardware, services, and expertise in automation and embedded computing.

After graduating from Clarkson University, Markopoulos began her career at GE as a member of the Management Development Program in 1993. Throughout her career, she has held a number of operational and business leadership roles, each with increasing responsibility.

These roles have given her the opportunity to experience many businesses within the GE portfolio including Energy, Home & Business Solutions, Energy Management and Oil & Gas. Markopoulos was appointed a Vice President and GE Officer in 2007.

As a dedicated volunteer and mentor, Markopoulos advises young women interested in pursuing engineering and manufacturing as a career. She is the co-leader of GE’s global Women’s Network, is active in Clarkson University recruiting and sits on the Clarkson University Board of Trustees.

Cynthia Warner

Executive Vice President, Operations, Tesoro Cynthia (C.J.) Warner is Executive Vice President of Operations at Tesoro. She oversees Tesoro’s Refining; Logistics; and Environment, Health, Safety, and Security groups, providing leadership that promotes safe, compliant, reliable execution and drives operating efficiency and effectiveness.

Prior to Tesoro, Warner held executive leadership roles at several global energy companies.

Most recently, she was Chairman and CEO of Sapphire Energy from 2012 to 2014, after joining as President in 2009, where she led the emerging biofuels company’s ongoing technology development and transition to commercial‐scale algae biomass and renewable crude oil production.

Prior to Sapphire Energy, Warner served as Group Vice President of Global Refining and Group Vice President of Health, Safety, Security, Environmental and Technology for British Petroleum (BP). During her 10‐year tenure, she oversaw refining operations in five continents and led a groundbreaking cooperative effort with the U.S. Environmental Protection Agency to shape an industry‐wide framework for clean-air improvements.

Warner began her career as a chemical engineer at UOP, followed by several years in operational leadership roles at Amoco. She is a featured leader in the 2008 book Becoming a Resonant Leader: Develop Your Emotional Intelligence Renew Your Relationships, Sustain Your Effectiveness (Harvard Business Review Press) and was named one of Fast Company’s 100 Most Creative People in Business in 2010.

In addition to Tesoro, Warner serves as a member of the Board of Directors for IDEX Corporation. She is also a member of the National Petroleum Council and the Board of Visitors of the Vanderbilt University School of Engineering.

Warner earned a bachelor of engineering degree in chemical engineering from Vanderbilt University and a master of business administration degree from Illinois Institute of Technology.

About WEN: The Women’s Energy Network (WEN)’s vision is to be the premier organization that educates, attracts, retains, and develops professional women working across the energy value chain. WEN’s mission is to develop programs to provide networking opportunities that foster career and leadership development of women who work in the energy industry. WEN currently has over 4,000 members in chapters in the Appalachia, Greater Atlanta, Chicago, Greater Colorado, Houston, New York, North Texas, Greater Oklahoma, Permian Basin, Greater Philadelphia, South Louisiana, South Texas and Washington D.C. areas to fulfill your networking, professional and personal development needs.

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To learn more about the 2017 WEN National Conference, visit www.womensenergynetwork.org/events.

JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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Dakota Access Pipeline: A Key Struggle in a Much Larger Fight A WAY FORWARD IN THE SENSITIVE BALANCE OF ENVIRONMENTAL PROTECTION AND ECONOMIC SURVIVAL By: Tom Mullikin

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he Dakota Access Pipeline (DAPL) project is serious business, for both sides. From the arguments about the criticality of the environment to economic necessity, to the myriad involved groups; the players — regardless of the side of the proverbial field they are on — are part of a much larger struggle. In fact, many on both sides of the debate are not local. They are part of either Global Environmental Inc. (funded by corporate nonprofits and billionaire sympathizers) or corporate energy interests.

This is neither new nor simple. For years, the aforementioned players across the U.S. and around the world have grappled with how to protect our global environment while avoiding ruinous impacts on the global economy. While we all benefit from industrial progress, no one would trade the environment for a job. And most want to ensure modern industry will not degrade the environment.

So what about DAPL, a $3.8 billion pipeline designed to transport almost a halfmillion barrels of crude oil per day from North Dakota to Illinois? This project will provide substantial improvement to America’s energy infrastructure, and it will strengthen America’s energy security. But there is significant opposition. Why? We will explain momentarily and share a way forward for all.

Five Facts and a Threefold Challenge First, the facts: 1. North Dakota’s Bakken Formation produces over 1 million barrels of crude oil per day with approximately 700,000 barrels of this crude transported by rail.

2. There are 2.6 million miles of pipeline running across the U.S.

3. “Pipeline systems are the safest means to move these products,” says the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (January 2013).

4. DAPL will have the capacity to transport 570,000 barrels per day, which represents approximately half of Bakken daily crude oil production.

5. The U.S. imports nearly 6 million barrels of oil a day from OPEC nations and other countries. This fact also equates to the U.S. sending more than $380 billion overseas where that money far too often ends up in the hands of “threat” regimes, state sponsors of terrorism and others who pose a significant threat to our national security.

With these facts comes a threefold challenge for communities across our nation.

First, we have to determine how to protect our environment and reduce our global environmental footprint. Second, we have to determine how not to ruin our economy.

Third, we have to determine how not to sacrifice our national security. And all must be equitably addressed.

The antagonists will often paint a seemingly untenable picture wherein they argue

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a clean environment and robust economy are mutually exclusive. But as President George W. Bush stated in his 2002 public papers, “[To] address climate change, we need to recognize that economic growth and environmental protection go hand in hand. Affluent societies are the ones that demand and can, therefore, afford the most environmental protection. Prosperity is what allows us to commit more and more resources to environmental protection.”

The Opposition For months now, vocal opposition to the DAPL project has raged in North Dakota as protesters from throughout the U.S. and beyond have gathered near the Standing Rock Sioux Reservation to protest and obstruct completion of the long-planned project.

In July 2016, the Standing Rock Sioux Tribe — represented by the environmentalist group Earthjustice — filed suit against the project regulator, the U.S. Army Corps of Engineers, immediately after the Corps issued authorizations for DAPL to cross certain federal waterways. The Standing Rock Sioux Tribe has argued in part that Nationwide Permit 12 violates the National Historic Preservation Act (NHPA). Additionally, the tribe argues that DAPL authorizations made in July by the Corps of Engineers violate the Clean Water Act, Rivers and Harbors Appropriation Act and National Environmental Policy Act. In a November letter, the Department of the Army stated that the prior authorizations granted for DAPL were correct, but invited the Standing Rock Sioux Tribe to participate in discussions regarding granting an easement for DAPL.

The antagonists will often paint a seemingly untenable picture wherein they argue a clean environment and robust economy are mutually exclusive

Complex projects similar to DAPL have benefited from meaningful collaboration among local leaders and opinion-makers seeking mutually acceptable solutions from all stakeholders through the use of what is known as the Collaboration Compact model

2017 Measurement School and Exhibition, hosted by the Corpus Christi Area Measurement Society February 21-22, 2017 This year’s school will offer more than 60 lecture and hands-on classes dealing specifically with Quality Testing and Measurement of Natural Gas, Refined Products and Crude Oil. In addition to classroom instruction, there will be an exhibit area where more than 70 companies will display their latest measurement and quality testing equipment and services.

Pre-register today and save!

The cost is only $125 per student (or $150 at the door) The school will be held at the Omni Bayfront Hotel

Dakota Access LLC filed a cross-claim against the Army Corps arguing that the Corps’ prior findings had already met the standard.

Due to the extensive media coverage of the protests, trending stories on social media, and involvement of celebrity activists such as Susan Sarandon and Leonardo DiCaprio, DAPL opponents’ claims have become widely known. With this negative attention continuing to escalate, DAPL’s financial backers are wary of continuing to support the project. Moreover, the public perception about pipelines continues to decline unnecessarily.

The Way Forward Complex projects similar to DAPL have benefited from meaningful collaboration among local leaders and opinion-makers seeking mutually acceptable solutions from all stakeholders through the use of what is known as the Collaboration Compact model (CCM).

A seven-step process that formulates a solution based on a binding community-corporation partnership, CCM was used effectively in Stillwater, Oklahoma (after the devastating loss of industry in Denton, Texas), when a local third-party group combated the passage of an onerous drilling ordinance that the antagonists hoped, if successful, to replicate across the state. The third-party group educated local elected officials, city staff and targeted stakeholders to promote pro-energy grass-roots activism and established a binding community of industry partnership, which resulted in the passage of a reasonable, mutually beneficial ordinance.

It appears that the primary objective of the antagonists is to prevent further fossil fuel development. DAPL supporters must utilize the CCM to educate all citizens on the nature and importance of transporting domestic energy in a safe and responsible manner, and align the needs and mutual interest of all stakeholders in order to create a win-win result.

Without energy production in the U.S., the economy will decline, global pollution will increase and American national security will weaken — creating a “trifecta of doom.” A balanced solution is the only solution for the DAPL project. These issues are difficult to solve; and only through education, reasoned discourse and collaboration is there an opportunity to produce and transport energy without jeopardizing a healthy sustainable environment, economy and national security.

About the author: Thomas Stowe “Tom” Mullikin is an environmental attorney, global expedition leader, and research professor at Coastal Carolina University. He has traveled to many of earth’s most remote regions in his quest to better understand and help develop new energy solutions.

Please visit the CCAMS website at www.ccams.info to learn more

We look forward to seeing you at the 2017 CCAMS Measurement School and Exhibition

RethinkFLARING JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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An Eloquent Warrior in the Mad War on Energy By: Bill Keffer

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eaders of this publication are already well-aware that there is an ongoing, conscious war being waged in this country by certain vocal, impassioned and even violent segments of our society against the further exploration, development, production, transportation and use of “muscle fuels” (like coal, oil and natural gas) as energy and fuel sources. These groups have demonstrated their willingness to engage in property destruction and threats of personal injury to convey their message to “keep it in the ground.” The alleged reasons for their extreme behavior range from a fear of polluted groundwater to the perceived ramifications of climate change on a catastrophic level. Whether it is the protests against drilling in the Arctic Ocean or the series of skirmishes experienced during the debate over the Keystone XL pipeline or the recent protests over the Dakota Access Pipeline, it is clear that these opponents of muscle fuels are on a mission to disrupt and prevent efforts to find, develop and use these natural resources.

Fortunately, articulate and knowledgeable spokespeople have risen to the challenge and are responding to the concerns of these groups with a balanced analysis of the benefits and challenges presented by muscle fuels. You have likely heard about the impressive efforts of people like Mark Mathis and his documentary film spOILed and Alex Epstein and his book The Moral Case for Fossil Fuels.

Well, add to that list Kathleen Hartnett White and the book she has written with Stephen Moore titled Fueling Freedom: Exposing the Mad War on Energy. White is the Distinguished Senior Fellow-in-Residence and Director of the Armstrong Center for Energy and the Environment at the Texas Public Policy Foundation in Austin. In this position, she directs research and policy on topics like energy, climate change, water and endangered species. She has been involved with this topic for some time now, having also served as Chairman and Commissioner of the Texas Commission on Environmental Quality from 2001 to 2007.

In Fueling Freedom, White and Moore methodically lay out a brief history of what the world was like before muscle fuels, what the world has become because of muscle fuels and how the world can continue to improve through the use of muscle fuels.

At the same time, the authors present a more balanced story about the false hope inherent in the over-reliance on renewable energy sources, like wind and solar.

White recently spoke at the Texas Tech University School of Law in the Energy Law Lecture Series. Her presentation focused on the themes of her book. An early slide in

her presentation set the tone for the head-scratching positions that opponents of muscle fuels continue to take in this ongoing national debate. The slide showed a photograph of a helicopter spraying hot water on the blades of a wind turbine unable to function because it is covered in ice. The helicopter is burning aviation fuel, and the hot water is being heated by an oil burner. All of this activity is being made possible by oil, so that intermittent and unreliable wind power — which is indisputably less efficient and much less dense as an energy source — can be rendered functional. The irony is inescapable, but the absurdity in policy choice is dangerous in its potential to cripple our economy.

White reminds those, who apparently have conveniently decided to forget about or ignore the human condition before the advent of the Industrial Revolution, just how coal, oil, and natural gas spectacularly changed what it had been like to live in this world. The gross domestic product of industrialized countries blew through the roof; (since the Industrial Revolution) the average life expectancy has tripled to 79 years; average personal income skyrocketed and enabled an enduring middle class to emerge; and populations boomed, but these fuels and their derivative products have led to more food being grown per person, despite having billions more people in the world. As much as advocates of command-andcontrol centralized governments hate to admit it, it is undeniable that access to abundant, available and

In her presentation, White points out simple, easy-to-grasp and hard-to-refute realities in our modern, global economy that are only made possible through oil and natural gas

About the author: Bill Keffer is a contributing columnist to SHALE Magazine. He teaches at the Texas Tech University School of Law and continues to consult. He served in the Texas Legislature from 2003 to 2007.

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Fortunately, articulate and knowledgeable spokespeople have risen to the challenge and are responding to the concerns of OPPONENTS OF FOSSIL FUELS with a balanced analysis of the benefits and challenges presented by muscle fuels affordable energy (like coal, oil and natural gas) is a fundamental and essential component for modern economic growth in any country and the reality of economic and individual freedom for the citizens in that country.

In her presentation, White points out simple, easy-to-grasp and hard-to-refute realities in our modern, global economy that are only

made possible through oil and natural gas.

For example, in 2014, on any given day, there were over 102,000 commercial airplane flights — made possible only through the use of jet aviation fuel derived from crude oil. A satellite photograph taken at night over North and South Korea shows the stark difference (in lights powered by electricity fueled by coal, oil

and natural gas) between a well-lit South Korea and a North Korea completely in the dark. She informs the uninformed that the mind-boggling increase in agricultural yield in the 20th century is the direct result of fertilizer enriched with products derived from natural gas. These products have actually expanded the areas of fertility across the world, where there had been only desert before.

Rather than “keeping it in the ground” out of fear of polluting the groundwater, opponents of muscle fuels should acknowledge the countless improvements in the quality and availability of potable water across the world because drilling rigs, pumps and filters fueled by oil and natural gas made it happen. Rather than shut down the global economy for fear of climate catastrophe (on which there certainly is no scientific consensus), opponents should acknowledge the famines and epidemics that have been minimized or averted altogether because of equipment and technology powered by, and made from products derived from, oil and natural gas.

Opponents of muscle fuels are notorious for having exaggerated and hyperbolic views on the challenges that accompany muscle fuels. Fueling Freedom should not only fill our information tank, it should also inspire us to take a stand for common sense.

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INDUSTRY

American Energy Needs Women — On the Job and Raising Their Voices Special to SHALE

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he long-term outlook for our industry is strong. With the support of positive government action — such as expanding access to resources, allowing infrastructure projects to move forward, and approving export applications — we could even see accelerated growth in the years ahead.

But in order for America’s energy industry to reach its full potential, we must build a strong workforce that includes women in every role.

Energy companies could add as many as 1.3 million new jobs by 2030, and it’s critical that women around the country — especially young women entering the workforce — recognize the career opportunities in oil and natural gas.

• Average industry pay is nearly $50,000 more annually than other industries. Though important, high salary is just one factor. Energy industry jobs also generally provide good healthcare benefits, flexibility, and a welcome work-life balance.

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• Women are already part of the energy workforce. Nearly 300,000 women are already advancing their careers in the energy sector.

It’s especially important to young women to know that the trail has been blazed by other women.

• The industry includes a wide range of blueand white-collar jobs. The energy industry has dozens of specialties and provides jobs with a range of education requirements. There are positions for women at drill sites, in refineries, at labs and in offices.

One of the biggest factors keeping women out of the energy sector is lack of awareness.

Our fundamental message to women should be that the energy industry is open for business and hiring.

The Role of Women in Energy Advocacy Women also make powerful advocates for our industry. Our industry needs as many voices as possible — in every community as well as in the halls of government — talking

In order for America’s energy industry to reach its full potential, we must build a strong workforce that includes women in every role about the importance of American energy.

Women can bring their perspectives to the discussion — not only as energy professionals, but as heads of household, consumers, mothers and daughters.

Both women and men can become part of our industry’s growing advocacy by participating in Energy Nation. In addition to keeping the energy workforce informed about critical public policy issues, Energy Nation provides career information from which women can learn about great opportunities in our industry.

To learn more about Energy Nation and its mission, visit www.energynation.org.

SHALE OIL & GAS BUSINESS MAGAZINE  JANUARY/FEBRUARY 2017

BASHTA/BIGSTOCK.COM

Putting Out the Welcome Mat Bringing more women into the energy industry isn’t just the right thing to do. It also makes good business sense to draw talent from the largest pool possible. As Jack Gerard, energy industry leader and president and CEO of the American Petroleum Institute, puts it, “This nation will not be able to fulfill its potential as a global energy leader without more hands on deck, particularly minority and female workers.”

All of us — women and men alike — can make this case, especially when we meet young women who have just graduated from high school or college, or women who are considering career changes or returning to the workforce.

According to recent research, the following points are especially meaningful to women considering careers in the energy industry:

JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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WHAT’S YOUR NEXT MOVE?

STEER: Fourth Annual Eagle Ford Excellence Awards Special to SHALE

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he South Texas Energy & Economic Roundtable (STEER) announced that Predator Pressure Control, Sun Coast Resources, Alphabet Energy, Aggreko, Falls City Education Foundation, HARC, Port of Corpus Christi and Cheniere Energy are the recipients of the 2016 Eagle Ford Excellence Awards. The awards honor leading companies and organizations working in or with the oil and gas industry for their diligent efforts in protecting the environment, making safety a top priority and giving back to the communities in which they live and work.

“Although it has been a tough year in the oil and gas industry, it’s encouraging to see that companies have remained focused on safety, environmental protection and community involvement,” says Omar Garcia, President and CEO of STEER. “It’s important, particularly in times like this, to persevere and stay true to your core principles. STEER is proud to honor those companies who share our value and vision.”

The awards ceremony provides both oil and gas companies and their contractors an opportunity to be acknowledged for their efforts in the areas of environmental stewardship, safety performance and community and social investment. Winners of the Eagle Ford Excellence Awards demonstrate innovation within the industry, make safety their largest priority and benefit the Greater South Texas region through workforce development and education.

The keynote address was provided by Sean Strawbridge, Deputy Executive Director and Chief Operating Officer for the Port of Corpus Christi Authority.

Judges for the 2016 Eagle Ford Excellence Awards were Robert Neugebauer, CPS Energy; Dan Titerle, San Antonio Water System; and Thomas Tunstall, Ph.D., University of Texas at San Antonio.

Recipients of the 2016 Eagle Ford Excellence Awards Safety Performance For companies or organizations with less than 250 employees: Predator Pressure Control For companies or organizations with more than 250 employees: Sun Coast Resources

• space planning • office furnishings • moving solutions

Community and Social Investment For companies or organizations with less than 250 employees: Port of Corpus Christi For companies or organizations with more than 250 employees: Cheniere Energy Environmental Stewardship For companies or organizations with less than 250 employees: Alphabet Energy For companies or organizations with more than 250 employees: Aggreko Impact Award Falls City Education Foundation HARC

courtierconsulting.com/reality

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»

For more information, visit STEER.com.

SUBMIT YOUR

INDUSTRY

PESA High Performer Spotlight CHRISTINA KARAPATAKI, EARLY STAGE TECHNOLOGY INVESTMENTS, SCHLUMBERGER Special to SHALE

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he Petroleum Equipment & Services Association’s Emerging Leaders Committee prepares high-performing individuals for their role as the next generation of industry leaders. The committee develops events and training seminars, including leadership forums, an executive coaching program, and Oil & Gas 101.

PESA interviewed Emerging Leaders Committee member Christina Karapataki (Early Stage Technology Investments, Schlumberger) about her vision for the industry.

What influenced your decision to enter the oil and gas industry?

My background is in chemical engineering, and very early on in my studies I was fascinated by how reliable energy supply affects every aspect of the economy and our lives.

Given the importance of oil and gas in the energy mix, I wanted to understand how the oil and gas industry works and how I could contribute to this sector.

What was your impression of the industry beforehand and how has it evolved?

I joined the industry in 2012 when oil prices were high and the industry was on a growth path. It is fair to say that my first impression of the industry was different than the environment we are in today. I quickly learned about the cyclical nature of the business and how large companies react to changes in the market and regulation. This has driven consolidation in the industry, but has also brought into focus the need for greater efficiency in operations.

What have you found to be the most surprising aspect of the industry?

Since I joined the industry, I have developed an appreciation for the technical complexity and advanced scientific expertise that is required to extract hydrocarbons. The technological breakthroughs that allow us to operate in a safe and reliable way in remote environments continue to surprise me on a daily basis.

What do you find most challenging and most rewarding about the industry or your work?

The most challenging part so far has been managing the downturn and the shift in priorities that this may entail. However, the most rewarding part of my job is that, regardless of the downturn, business segments want to continually improve and invest in technology that will help them operate more efficiently and push the envelope of their current capabilities.

Where do you hope to see the industry develop over the next five years?

I would hope to see more collaboration in the energy industry and more activities that promote efficient, safe and environmentally responsible technology in the oil field. I would also like to see the industry recruit and retain young talent. I believe that will help build the foundation for the future.

What role do you believe you will play in the industry’s future?

Technology innovation is how this industry will advance. I hope to further contribute in the sourcing and adoption of new technology that can help the industry operate with higher efficiency and productivity.

Tell us about some of the people you’ve met while working in the

industry and how they’ve impacted your thinking.

In my role, I get to meet entrepreneurs that are working to introduce new technology into the energy sector. Their perseverance and conviction impress me every time. It is hard not to be motivated by all the technology out there and the potential impact it could have on the industry.

What are you most excited about for your career, your company and your industry?

I am excited to see how this industry can evolve in the future. With technologies such as automation, robotics and data analytics, I would expect to see efficiency improvements and potentially new ways of operating in the oil field. I am particularly interested to see where these new advancements will take us.

What would you tell someone who is thinking about entering the oil and gas industry?

Oil and gas is a global industry with many exciting career opportunities.

Be open to new experiences, be prepared to travel and be ready to learn new skills at a fast pace.

»

To learn more about PESA, visit www.pesa.org.

JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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INDUSTRY

How to Rethink Flaring Special to SHALE

The single, fully integrated PGCTM delivers both nearcomplete destruction of volatile gases and meets BlackBrush’s need for on-site power generation by converting post-combustion heat into electricity

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best solution for reliable power and safe, validated waste destruction.

The PGCTM design uses an enclosed combustion chamber with forced air blowers that eliminate smoke and visible flames — a clear win for neighbors, ranchers, and landowners. The 2.5 kW of power generated by BlackBrush’s PGCTM will allow the company to upgrade site Supervisory Control and Data Acquisition (SCADA) systems and install instrument air packages that allow for significant improvements in site reliability and safety, fewer

callouts and reduced fugitive emissions associated with pneumatic controllers and pumps.

BlackBrush selected two of its most challenging Eagle Ford production sites for the initial deployments and proving of two Alphabet Energy PGCTM units.

These well pads did not have electrical infrastructure, but now BlackBrush Oil & Gas is ready to standardize its site designs with new electrical loads, and its team is looking forward to the increased optionality and improved safety of having reliable power on site.

For more information, including site data figures for electrical draw and emissions reductions, please contact sales@alphabetenergy.com or call Ty Henrich at 972-632-6728. Learn more about Alphabet Energy by visiting alphabetenergy.com.

SHALE OIL & GAS BUSINESS MAGAZINE  JANUARY/FEBRUARY 2017

RICOBOOT/BIGSTOCK.COM

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t takes a talented team to successfully lease and operate over 160,000 acres of land across the Eagle Ford, Buda, Pearsall, Olmos, and San Miguel Basins. San Antonio-based BlackBrush Oil & Gas not only does this well, but also runs its integrated network of wells and tank batteries in remote and off-grid locations.

BlackBrush’s range of operations — including oil, wet gas, and dry gas — regularly present a number of mission-critical challenges. These challenges affect both production and a number of key stakeholders including shareholders, neighbors, and royalty owners.

Some of BlackBrush’s operational challenges include a nonexistent electrical power grid infrastructure; high costs associated with time and labor for scheduled and unscheduled maintenance; and high risks associated with trespassing, vandalism, and equipment theft.

Challenges from stakeholders, local land owners, and royalty owners include visible flames associated with open flares; noise pollution associated with engines and generators; traffic associated with the frequent comings and goings of maintenance crews and service vehicles; and lost income associated with flared products that are not sold to market or utilized.

More than just critical thinking was necessary to both overcome these challenges and benefit from present opportunities.

BlackBrush Oil & Gas learned about Alphabet Energy’s PGCTM after hearing about its midstream work with Encana & Sinopec.

Well ahead of many of its regional peers, BlackBrush purchased PGCTM units to transfer Alphabet Energy’s proven midstream technology to well pads in South Texas for the generation of reliable power for house loads.

The single, fully integrated PGCTM delivers both near-complete destruction of volatile gases and meets BlackBrush’s need for on-site power generation by converting post-combustion heat into electricity.

The value proposition was a clear fit for BlackBrush, and both its engineering and operations teams concluded that PGCTM was the

IT’S OUR MISSION to serve as the bridge connecting the oil and natural gas industry to South Texas communities.

STEER will work to ensure that all stakeholders throughout the Eagle Ford Shale region are able to effectively maximize opportunities in a responsible and collaborative way.

Learn more at steer.com Follow us: facebook.com/STEEROUNDTABLE

@STEEROUNDTABLE JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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INDUSTRY

Solutions to Oklahoma’s Earthquakes Continue to Evolve THE OIL AND GAS INDUSTRY IS CLOSELY WATCHING REGULATORY FRAMEWORK AS IT DEVELOPS By: Cindy Elliott Allen

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Before the dramatic uptick in seismicity the state has experienced since 2011, injection deep underground wasthe preferred environmental solution to disposing of wastewater

OCC Restricts Wastewater Injection and Small Earthquakes Slow Down Since 2015, the OCC has issued directives to restrict the amount of wastewater being injected into a large area of interest of about 15,000 square miles identified as the primary area where earthquakes could occur. Since May, wastewater injection has been reduced by as much as 1 million barrels a day in those areas.

The effect of the reduction has been a sharp decrease in the number of earthquakes, as reported by Dr. Jeremy Boak, director of the Oklahoma Geological Survey. As of summer 2016, earthquakes at 3.0 magnitude or higher had been reduced in the state by about 15 percent from the year before.

However, on Sept. 3, 2016, the state’s largest quake, a 5.8 magnitude, struck Pawnee, Oklahoma, causing the most

CYLONPHOTO/BIGSTOCK.COM

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klahoma’s ever-developing approach to dealing with earthquakes is having a positive effect. However, advocates for the oil and natural gas industry say they expect more directives to continue to come their way.

The Oklahoma Oil & Gas Association, a trade industry that represents most of the state’s largest producers, has been working closely with regulators, researchers and companies in advancing actions that are based on science and research, says Executive Vice President Arnella Karges.

“The majority of Oklahoma legislators understand it is a technical and complicated issue, and Oklahoma Corporation Commissioners are relying on science in creating policies and regulations,” Karges says. “Legislators also believe the Corporation Commission is the proper agency to handle seismicity regulations.”

Since early 2014, the industry has actively

worked with the state’s Coordinating Council on Seismic Activity and the Water for 2060 Produced Water Working Group to find solutions to reduce seismicity and the amount of produced wastewater injected deep into the Arbuckle Formation.

Through the oil and gas industry’s help in providing the Oklahoma Geological Survey proprietary seismic research in oil and gas plays, wastewater injection deep into the Arbuckle Formation has been identified as the primary culprit that could be triggering much of the seismicity. The earthquakes primarily occur in north and central Oklahoma, which is home to the Mississippian Lime play. The Mississippian Lime is known for producing a large amount of salty, briny wastewater along with oil and gas. Oklahoma Corporation Commission (OCC) regulations require that wastewater be disposed of. Before the dramatic uptick in seismicity the state has experienced since 2011, injection deep underground was the preferred environmental solution to disposing of wastewater.

arnella Karges says the oil and gas industry will continue to support directives from the Oklahoma Corporation Commission, Oklahoma Geological Survey and other researchers to reduce seismicity as long as regulators follow science-based approaches to changes in wastewater disposal significant damage of any of the previous quakes. The location of the quake was on the outskirts of the area of interest identified by researchers. Researchers concluded that, somehow, the pressure created by the injection wells is pushing faults that are relatively far away.

In early November, another strong earthquake, a 5.0 magnitude, struck Cushing, Oklahoma, the site of the world’s largest commercial oil storage hub. In the wake of these two large seismic events, the OCC issued more directives aimed at shutting down more wells and increasing the areas of interest for watching seismicity. The impact has been not only a reduction in wastewater disposal, but also in oil and gas production from the Mississippian Lime play, the Oklahoma Oil & Gas Association reports.

Researchers Continue to Worry About Large Quakes Stanford Geophysicist Cornelius Langenbruch and his colleague Dr. Mark Zoback recently released a peer-reviewed study in Science Advances that confirms the decline of small earthquakes in Oklahoma.

The study further solidifies the “clear relation” between wastewater disposal volumes and earthquake rates. The state’s 180-day moving average of 2.8 magnitude or greater earthquakes peaked at approximately 4.5 per day in summer 2015, declining to about 2.3 a day in fall 2016.

The researchers told Tulsa World that the state’s seismicity should return to its typical background levels with the regulatory cap on injection volumes. But effects from years of injecting so much saltwater into disposal wells could impact Oklahomans for several more years.

They concluded that Oklahoma is “almost certain” to have a damaging earthquake in the next five years, with heightened risks of a large quake probable to continue for a decade even

with the declining frequency.

Karges says the Coordinating Council on Seismic Activity and oil and gas companies are taking this recent study seriously, but they are also encouraged by the sharp decline in earthquakes from 2015 levels.

“We’ve been seeing how regulators have been balancing the amount of disposed produced water volumes, and it seems to be working,” she says. “Dr. Zoback presented information that shows the probability of earthquakes continuing to decrease in 2017 by a substantial amount.”

Langenbruch says elevated risks will remain in the earthquake zone for the next five to 10 years for a quake capable of damaging buildings, not ruling out the possibility for multiple large quakes.

Karges says the oil and gas industry will continue to support directives from the OCC, Oklahoma Geological Survey and other researchers to reduce seismicity as long as regulators follow science-based approaches to changes in wastewater disposal.

OCC to Issue Guidelines on Completions Processes In December 2016, Oklahoma regulators announced they will release industry guidelines and best practices on the small number of earthquakes that are possibly linked to hydraulic fracturing. This concern is a departure from what has been their primary focus on the connections to wastewater disposal wells used in oil and gas development.

“This is part of a continuous, ever-evolving approach when it comes to seismicity,” the OCC’s Matt Skinner. “The bulk of our concern is obviously up in the main earthquake areas like Cushing and Pawnee. But we have been providing data and working with the Oklahoma Geological Survey on the issue of hydraulic fracturing and seismicity. It is something we hope to complete work on soon, but quite

frankly, our highest priority is up in the main earthquake area.”

Karges says the OCC guidelines will likely reflect internal controls oil and gas companies are already using to watch for seismic events during hydraulic fracturing jobs. Many of the association’s members are among the most active drillers in the SCOOP and STACK plays, which are located in south-central and southwestern Oklahoma and do not have the same produced water quantities as the Mississippian Lime.

In the meantime, the Oklahoma Oil & Gas Association is expecting the OCC to continue issuing additional wastewater reduction directives over a large area.

“They [the OCC] have responded to the immediate needs,” Karges says. “We are still expecting a larger directive for the Cushing and Pawnee areas.”

Potential Legislative Action Considered Karges says she doesn’t expect much new legislation regarding earthquake response from the Oklahoma Legislature during the 2017 session. However, she said it is possible legislators will look at reducing or prohibiting wastewater from coming into Oklahoma for disposal from other states.

“Only a very negligible amount of wastewater disposal is made up from outside the state,” she says. “And, in coming up with any new regulations, legislators must consider interstate commerce laws.”

She also says the Water for 2060 Produced Water Working Group has been considering potential regulations regarding recycling and reuse of produced water with possible tax incentives offered for recycling. However, many regulatory issues that are not already in place must be addressed, including transportation, ownership of the water, etc.

“On all those issues, Oklahoma needs to have a better regulatory framework,” Karges says.

About the author: Cindy Elliott Allen is a veteran Oklahoma journalist who has spent most of her career as a reporter, editor and publisher of community newspapers in Oklahoma, Arkansas and Kansas. She most recently has concentrated on writing about the oil and natural gas industry and has served as a Communications Specialist for Devon Energy and as a Strategic Communications Adviser for the Oklahoma Oil & Gas Association. She also writes about public policy and politics on her blog, www.conservativemakingsense.wordpress.com.

JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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POLICY

The Boys Club Is Going Out of Business By: David Blackmon

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his issue’s focus on women in business got me thinking about my own experience with this subject during a 37-year career in the oil and natural gas industry. To say things have changed during that time would be a great understatement, though work remains to be done.

I came into the industry in June 1979 as a revenue accountant for Coastal Oil and Gas Corporation in Houston. The industry at that time was generally still considered to be a big “boys club,” mainly because prior to the 1980s women had rarely chosen to major in fields such as petroleum engineering, geology and other technical fields that are important to the oil and gas business. Because of this reality, the male-to-female employee ratio in the oil and gas industry has been slower to even out than in other U.S. businesses.

Though there were female employees in Coastal’s revenue accounting group at that time — perhaps 25 percent of the workforce — all of the management roles were occupied by men, a situation that was pretty typical in the industry at that time. Other female employees during that time were typically seen in administrative, human resources and support roles.

This all began to change as the 1980s moved along and young women gained seniority in organizations and were being promoted into supervisory and management roles. Also in the early 1980s, engineering and other scientific disciplines began to see a significant uptick in the number of young women choosing to major in those subjects, and the industry was able to look forward to an influx of female engineers and geoscientists. The boys club was beginning to come to a gradual end.

Then the mid-’80s oil bust hit, as the oil price collapsed during 1984 from about $40 per barrel down to single digits. Oil companies began laying people off in droves, and these general layoffs continued as an overriding trend well into the 1990s. As a consequence of this downturn, enrollment in petroleum engineering and geology schools collapsed all over the country, and the anticipated evening out of the male-tofemale ratio in the industry’s employee population was delayed.

It was during this time — from 1985 through about 2000 — that the industry’s infamous 15-year gap in employee age groups came about. The simple fact is that the industry did not do much hiring at all during this period of time. I like to tell the

Women now play a very significant and growing role — both in the industry itself and in the realm of public policies that affect it

story that, on the day I went to work for Meridian Oil Company (later Burlington Resources) in October 1987, I was 31 years old, which was about the average age of an employee for that company. Fifteen years later, I was 46 years old and still about the average age of an employee at that company.

So, progress was slow, but it did keep coming. By 1987, I was reporting to my first female accounting manager at Meridian Oil in Fort Worth. As time rolled through the 1990s, we began to see more and more women promoted into these mid-level management roles, and then into senior management positions as we moved into the 21st century. The last two companies for which I worked full time both have very accomplished women serving as their respective general counsels.

Still, in large part because CEOs at oil and gas companies tend to come from the engineering, geoscience or operations departments of their organizations, the industry continues to lag well behind others in the number of women who have advanced to the highest leadership role. The boys club has diminished, but the highest levels of many organizations tend to be mostly male-dominated realms.

The same dynamic has held true at the industry’s trade associations, where we see an ever-increasing number of women in support roles, but the President/CEO positions still are dominated by men. Denise Bode had a very successful stint as President of the Independent Petroleum Association of America (IPAA) in the mid1990s, and Regina Hopper became the first full-time President of America’s Natural Gas Alliance in 2009. But these ladies were two exceptions, and today every one of the upstream oil and gas industry’s trade association is headed up by a man.

Upon leaving IPAA, Bode returned to her home state of Oklahoma, where she served for years on the Oklahoma Corporation Commission, which regulates the oil and gas industry in that state. Here in Texas, we have seen five women become either appointed or elected to serve on the Texas Railroad Commission. Elizabeth Ames Coleman (formerly Jones) spent eight years in that role from 2005 through 2012 before leaving to make a run for the U.S. Senate. Christi Craddick, the current chair of the Railroad Commission, has been a commissioner since 2012.

There obviously continue to be more men in these key

About the author: David Blackmon is Associate Editor for Oil and Gas for SHALE Magazine. He previously spent 37 years in the oil and natural gas industry in a variety of roles, the last 22 years engaged in public policy issues at the state and national levels. Contact David Blackmon at david.blackmon@shalemag.com.

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regulatory positions than women (all three candidates for the seat on the RRC up for election this year were men), but the overall dynamic is that voters in Texas, Oklahoma and other states have no reservation about electing women to these high offices.

The same dynamic has taken place over the last 37 years where political offices in state legislatures and Congress are concerned. Throughout the 1990s, Texas Sen. Kay Bailey Hutchison assumed leadership positions on a variety of key energy-related issues, working cooperatively with congressional Democrats and the Clinton administration on matters impacting

Comfort.

Connectivity.

Choices.

The industry at that time was generally still considered to be a big “boys club,” mainly because prior to the 1980s women had rarely chosen to major in fields such as petroleum engineering, geology and other technical fields that are important to the oil and gas business the oil and gas industry. Louisiana Sen. Mary Landrieu was for many years the most active supporter of the oil and gas industry among Democrats in the Senate.

The state of Wyoming has also produced a progression of women officeholders who have taken on leadership roles on energy in Washington. Reps. Barbara Cubin and Cynthia Lummis both fought hard for policies that promote a healthy oil and gas industry in the U.S. We can expect the same from the newest Congresswoman from Wyoming, Liz Cheney, the daughter of former Vice President Dick Cheney.

In the Texas state legislature, Rep. Myra Crownover has assumed leadership roles on energy matters for eight terms in office.

A steadily growing number of women in legislatures all over the country have made substantial impacts on the energy policies of their states.

The boys club that I came into when I entered the oil and gas industry in 1979 is slowly but surely going out of business over time. Women now play a very significant and growing role — both in the industry itself and in the realm of public policies that affect it. Work remains to be done, but you can see the progress being made with every passing year. And that’s a very good thing for all involved.

JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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POLICY

Can the Government Be Run Like a Business?

By: Thomas Tunstall, Ph.D.

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ow that the unexpected has occurred, and Donald Trump is President-elect of the United States, a lot of pundits and analysts will be trying to forecast future policy directions. The Trump presidency is unique in many ways, not the least of which is his frequently cited credential as a successful businessman. As with the Ross Perot candidacy in the 1992 presidential election, many people have suggested that what’s needed in the White House is an executive with business experience. While that may be true — and we will now certainly see — it has to be said that the rules in the business world are not the same as those in the public policy arena.

It’s true that the President appoints his staff and cabinet members, but all of those positions are housed

It has to be said that the rules in the business world are not the same as those in the public policy arena in the executive branch. The President even appoints federal judges; however, the Senate must confirm these appointments. Once confirmed, the posts are for life. Federal judges do not serve at the pleasure of the President the way staff and cabinet members do.

The executive branch is one of three equal branches of the government. Congress is not a board of directors — it is a conglomeration of 535 men and women who each won their election in their state or district. Unlike within the management ranks of corporate America, members of Congress cannot be fired by the President. Only their constituencies can do that.

The differences between the public and private sectors are significant. By definition, public policy is a collaborative undertaking. In the public sector, there is an economic context to be sure, but also social, political, cultural and governing contexts. In the broadest strokes, it is equal parts political, social and economic — the first two of which are not usually the main considerations in a business environment.

Those social and political aspects may not be the most efficient means to governing, but they grease the wheels that enable legislation to be enacted. Much of that will likely be unfamiliar to the new President. Logrolling, for example, is a term that no introductory course in public policy would be complete without. Yet in an MBA program, it is almost certainly absent.

Public policy is a participatory process. Corporate strategy, by contrast, requires no such accommodation. Within the limits of the law (a public sector function), private companies may operate freely. Their domain is a very microeconomic one.

The government by contrast is a macro entity. Look at the powers government has: regulation, subsidization of entire industries, the ability to ration resources, taxing and spending, implementation of market incentives, privatization, and the ability to assess fees across all segments of the economy.

No business has such a broad scope of activity that can impact so many areas of our lives. This gets us back to why government power is best shared between different branches of government — not concentrated in the office of the President, with or without a pen and a phone.

Public policy is a formidable and complex tool for governing. We are all wellaware of many past failures of public policy over the years. President Trump should endeavor to learn from what many would argue is a relatively short list of public policy successes. Some of those examples include the GI Bill after World War II (Servicemen’s Readjustment Act of 1944), Federal Aid Highway Act of 1956, Voting Rights Act of 1965, Airline Deregulation Act of 1978, Personal Responsibility and Work Opportunity Reconciliation Act of 1996, and the Morrill Act of 1862, which extended the land grant system that funds public colleges to more states.

Public policy is an inclusive, wide-ranging arena that goes well beyond the bounds encompassed by any single business, no matter how many customers it has or how many billions of dollars in revenue it generates. Democracy, particularly in the U.S. — and also by design — can be a messy and unruly process. This most recent presidential election is ample proof of that. But the government’s first responsibility is not to be efficient, but rather to ensure fairness and impartiality to all citizens — something not usually found in corporate mission statements. Only time will tell how President-elect Trump’s experience as a businessman will translate to his presidency.

About the author: Thomas Tunstall, Ph.D., is the Research Director at the Institute for Economic Development at the University of Texas at San Antonio. He was the principal investigator for the Economic Impact of the Eagle Ford Shale studies released in May 2012, March 2013 and September 2014, as well as the West Texas Energy Consortium Shale Study. He has published peer-reviewed articles on shale oil and gas, and has written op-ed articles for The Wall Street Journal. Dr. Tunstall has spent a significant portion of his career on overseas workforce and economic development assignments in such locations as Azerbaijan, Afghanistan, Kenya and Zambia. He holds a Ph.D. in economics and public policy and an MBA from the University of Texas at Dallas, as well as a BBA from the University of Texas at Austin.

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stepenergyservices.com 800-349-0921 JANUARY/FEBRUARY 2017  SHALE OIL & GAS BUSINESS MAGAZINE

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POLICY

In Colorado, Energy Critics Face Tough Choices By: Simon Lomax

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or oil and gas opponents in Colorado, this is not the way 2017 was supposed to begin.

In last year’s election, liberal billionaires Tom Steyer and George Soros poured money into the state’s down-ballot races. But it didn’t work. Republicans kept their one-seat majority in the Colorado Senate. They even defended their majority on the University of Colorado’s Board of Regents, which has been a target of fossil-fuel divestment activists for years.

Hillary Clinton, who was ready to continue the Obama administration’s energy and environmental policies, carried Colorado but lost the presidential election to Donald Trump. Republicans kept their majorities in Congress and Colorado. Also, Republican Rep. Mike Coffman — targeted by national environmental groups

Two weeks before the election, environmental groups and their allies in the state legislature were confident of victory and openly discussed plans for a new climate committee like the Sierra Club and League of Conservation Voters — decisively won reelection to a House seat in the Denver suburbs.

It has been a stunning turnaround. Two weeks before the election, environmental groups and their allies in the state legislature were confident of victory and openly discussed plans for a new climate committee. It would have pushed bigger mandates for renewable energy, new restrictions on Colorado’s fossil fuel industry and the continuation of the Obama administration’s energy and environmental policies.

After the election, the new committee will stay, but under the control of Republicans in the Colorado Senate.

Instead of defending the Obama era, the committee

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will focus on efforts to reverse the executive-branch programs that defined the 44th president’s environmental agenda and examine how Colorado’s economy may benefit from these proposed federal regulatory reforms.

And on top of these political changes, supporters and detractors of the state’s energy industry have something else to consider — signs of a comeback in oil and gas development. In late November, OPEC nations reached an agreement to curb production, boosting oil prices and the number of rigs operating in Colorado. By the last week of December, Colorado’s rig count had climbed to 28, the highest number in more than a year.

Under the circumstances, it’s natural to focus on Republican moves at the federal and state level, especially since Trump’s victory was a big surprise. But the postelection moves of Democrats and environmental activists in Colorado are equally fascinating and will also have long-term political and policy consequences.

The 2016 election exposed deep divisions within the Democratic coalition over the role of fossil fuels. On one side, there’s the Tom Steyer wing, which wants to eliminate fossil fuels in the short term, mandate the use of more costly renewable sources, and give the U.S. Environmental Protection Agency expansive new powers over the statelevel energy decisions. On the other side, there’s the blue-collar wing that supports oil, natural gas and coal production, and worries about job losses from anti-fossil fuel laws and EPA regulations.

In 2016, Steyer and national environmental groups spent well over $100 million in a crusade to make the environment — and especially climate change — a top campaign issue. But the move backfired.

Some union leaders lashed out against Steyer in public. “His vision of leaving oil, natural gas, and other fossil fuels in the ground kills jobs, drives up energy costs, and threatens to strangle our economy,” said the Laborers’ International Union of North America’s President Terry O’Sullivan in a letter to the American Federation of Labor and Congress of Industrial Organizations several months before Election Day. But the climate push continued, weakening Clinton’s support among blue-collar voters in the key battleground states of the industrial Midwest.

Nationally, the Steyer wing of the Democratic coalition isn’t giving any ground after the election. Despite the outcome, the California billionaire and environmental activist told Reuters, “We wouldn’t do anything differently.” He’s also sticking with the claim that so-called green jobs will compensate for layoffs caused by anti-fossil fuel policies — an argument that clearly didn’t work with blue-collar voters.

“We probably have almost 10 times as many people working in clean energy just in my home state as there are coal miners in the entire United States of America,” Steyer told CNN. In Colorado, the early evidence suggests that Democratic officials and environmental groups are doubling down on the Steyer strategy. Senate Minority Leader Lucia Guzman (D-Denver), a member of the new energy committee, says members of her party will stand strong, according to The Colorado Statesman.

Guzman is joined on the committee by Sen. Matt Jones (D-Louisville), who also holds the newly created position of Deputy Minority Leader for Conservation, Clean Energy and Climate Change. According to the Durango Herald, Jones has “led many of the anti-fracking fights at the Capitol,” and was a staunch supporter of Obama’s executive branch actions against the fossil-fuel industry.

“We have to be very aggressive with these rules,” Jones told an EPA field hearing in Denver on the EPA’s Clean Power Plan. “EPA, stay strong,” he added.

Elsewhere, Jones has stated, “We need to keep Colorado an attractive state ... not an extractive state.”

So which faction of the Democratic coalition — environmental activists or energy pragmatists — will win this internal struggle?

Environmental groups in Colorado are following the lead of their national counterparts, vowing to fight any changes to Obama-era energy policies. On federal lands, for example, efforts to reverse years of delayed and withdrawn oil and gas leasing will be strongly resisted, according to the WildEarth Guardians. “[I]t’s going to be watchdogging like we’ve never watchdogged before,” the organization’s Climate and Energy Program Director Jeremy Nichols told

the Grand Junction Daily Sentinel.

Similarly, the proposed Jordan Cove LNG export terminal in Oregon — which would give western Colorado natural gas producers greater access to international markets — will continue to be fought by environmental activists.

The debate over the project, which has hit roadblocks at the Federal Energy Regulatory Commission, is a prime example of the left’s deep divisions over energy policy. “The West Slope needs this,” John Swartout, an adviser to

Colorado Gov. John Hickenlooper (D), told the Daily Sentinel in support of Jordan Cove.

So which faction of the Democratic coalition — environmental activists or energy pragmatists — will win this internal struggle?

It’s still too soon to say. True, the Steyer wing is making the most noise right now. But there’s a difference between hard feelings over the election result, which may fade with time, and a prolonged campaign to rid the party of fossilfuel supporters.

But this much is clear: Anti-fossil fuel activism is bad for the Colorado economy.

While the state has a significant renewable industry and some very aggressive renewable energy mandates, 89 percent of the energy consumed in Colorado still comes from oil, natural gas and coal, according to data from the U.S. Energy Information Administration.

And Colorado, of course, is one of the nation’s top producers of fossil fuels as well.

Walking away from Steyer and environmental activist groups may be a tough choice for some public officials in Colorado.

But it would be the smart choice.

About the author: Simon Lomax is a Managing Director with FTI Consulting in Denver. He advises pro-business groups and holds an adjunct position with the Independence Institute, a free-market think tank. Before going into advocacy, he was a news reporter for 15 years and covered energy policy for Bloomberg News and Argus Media. The views expressed are his own. Contact him at simon.lomax@fticonsulting.com.

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COMMUNITY

We All Have the Same 24 Hours A YOUNG LAWYER FINDS BALANCE BETWEEN BILLABLE HOURS AND COMMITMENT TO COMMUNITY SERVICE By: Brittany Sakowitz

For the past few years, I’ve volunteered in administrative placements — volunteer placements inside the League — starting as a writer for the League’s magazine, working my way up to Assistant Editor and serving as Editor of the publication this year. These placements have contributed to the League’s overall goal of building a better community, but also provided me with training I don’t necessarily receive from work and the opportunity to flex my creativity. Because I can volunteer in these administrative placements in the evenings, on weekends and from home, they also fit well into my work schedule. I have loved getting to volunteer alongside other members of the League and am grateful that I submitted my application for membership during law school. It has been a decision that has added meaning to my daily schedule and great friends to my life.

We can all be easily inundated with work and family responsibilities and to-do lists. As a busy M&A lawyer with a billable hours target to fill each year, I view everything in terms of time. I only spend time on things I enjoy — my job, spending time with my husband, family and friends, and volunteering. We all have the same 24 hours. With a focus on the most important things in life and making the most of every day, we can each make time to make a difference.

With a focus on the most important things in life and making the most of every day, we can each make time to make a difference

About the author: Brittany Sakowitz is a Senior Associate at Houston-based law firm Vinson & Elkins. She concentrates her practice on mergers and acquisitions, private equity investments, capital market transactions and corporate governance for energy, oil and gas and technology clients. She has a B.A. in communications from Louisiana State University and a J.D. and MBA from the University of Houston. She has been selected for the Texas Rising Stars list, Super Lawyers (Thomson Reuters) from 2014 to 2017.

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SHALE OIL & GAS BUSINESS MAGAZINE  JANUARY/FEBRUARY 2017

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s a third-year law student at the University of Houston Law Center, my schedule was already packed with final exams, papers and interning for law firms; but with the flexibility of a student schedule, it felt like the ideal time to make a commitment to community service.

I began my career practicing corporate law at BakerHostetler before moving to Vinson & Elkins and specializing in mergers and acquisitions and private equity, often focused on the energy industry. My weekdays are filled with time-sensitive deals and a fast-paced schedule. I wanted to find an organized way to volunteer, meet new people and get involved in different charitable organizations in the community. I needed a volunteer program that had a certain level of both structure and flexibility to match my schedule.

The Junior League of Houston Inc. has such a large, diverse and flexible menu of volunteer offerings that I knew it would be easy to find a volunteer post that fit into my schedule. With every volunteer opportunity at the League, you know that it will be organized and contribute a valuable service. Like all provisional members at the League, I spent my first year volunteering with Texas Children’s Hospital and working in the kitchen for the League’s Tea Room.

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