#006: How Technology + Automation Improves the Oil & Gas Industry with Corey Scott


Technology is the future for every industry in the world, and the oil and gas industry is no different.

On today’s episode, Corey Scott,  and Phil talk about how EnergyLink helps operators and royalty partners get paid faster with fewer disputes and simplifying the communication by looking at the data.

Here are some of the things you can look forward to in this episode:
  • Find out how RedDog systems got its name
  • Hear how developers actually develop software for the industry
  • Find out how to use EnergyLink to get paid faster by your partners with fewer disputes
  • Find out where data exchange is going in the future
  • How automation is changing the landscape for oil and gas businesses no matter the market conditions
  • Get the inside scoop to what’s next for EnergyLink and its customers

Dive into this episode that will change how you think about technology in your business.

Connect with Corey Scott and Red Dog Systems, Inc. 

Corey Scott currently serves as the U.S Sales Director at Red Dog Systems, Inc., a Calgary based software company that provides cloud-based solutions to customers involved in Joint Interest Billing, Revenue accounting and Owner Relations. Prior to joining Red Dog Systems in 2008, Corey worked at ConocoPhillips, helping to implement and manage the company’s Joint Venture accounting software products. He is a graduate of Oklahoma State University, where he received his Bachelors Degree in Finance.

Website: www.energylink.com
LinkedIn: www.linkedin.com/company/red-dog-systems-inc.

Grab the CEO Toolkit: 120+ Tools, Favorites & Freebies to scale your oil & gas business no matter what the industry looks like for free!

 

#005: How Three US States Are Changing the Industry for the World


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A decade ago the industry was looking bleak by many standards and the talk was spreading of reaching peak oil.

Fast-forward to today, and Jerry James, president of Artex Oil Company, is at the forefront of an American revolution of natural gas that’s taking the world by storm.

On today’s episode, Jerry James and Phil discuss how technology has turned the East Coast into a huge player for the Shale Crescent and what’s coming next for the industry.

Here are some of the things you can look forward to in this episode: 

• Which states collectively make-up 30 percent of the country’s natural gas supply
• Why natural gas is such a hot topic these days
• What global industries are moving into the Shale Crescent
• Find out how profit margin actually works in the oil and gas industry

Listen now to get the inside scoop on the hottest destination spot for companies worldwide.

Connect With Jerry:

Learn more about the Shale Crescent
Jerry resides in Marietta, Ohio. He holds a degree in Petroleum Engineering and has served as President of the Ohio Oil and Gas Association (OOGA) and chairman of the Ohio Oil and Gas Energy Education Program (OOGEEP).

In addition, he is a Registered Professional Engineer in Ohio, Kentucky, West Virginia, and Pennsylvania and a member of the Society of Petroleum Engineers, and Society of Petroleum Evaluation Engineers.

Jerry has served as President of Artex Oil Company since 1995. Prior to assuming his current role, he held positions with various major oil companies in Texas, Louisiana, and Wyoming and served as a petroleum engineering consultant for James Engineering, Inc. based in Ohio.

Jerry is a founder and vice-chairmen of Shale Crescent USA. an economic initiative to bring manufacturing jobs to the OH, WV, and PA region.

Website: www.shalecrescentusa.com

Twitter: https://twitter.com/ShaleCresUSA

Facebook: https://www.facebook.com/shalecrescentusa/

#004: It Runs in the Family: Tom Stewart’s Lifetime Career in the Oil & Gas Industry


Tom Stewart joined his father in the family oil and gas business. He got started as a roustabout, a place he says everyone who begins in the oil and gas industry should start: in the trenches.

His family has built a legacy in the oil and gas industry from his grandfather to his father and five uncles and then Tom joined at 23 years old and moved up to run the family business, and then eventually became head of organizations like OOGA, the Ohio Oil & Gas Association, and took a vested interest in getting laws passed through Congress to further the oil and gas industry.

Each guest that we have on the podcast references the dramatic use that technology plays in moving the oil and gas industry along at a rapid pace. Stewart is no different.

Highlights from his interview: 

>> He calls himself a “fracking baby” because he grew up as a toddler in the early fracking age in 1953, where wells in the Clinton formation were being discovered and reworked with incredible success, giving his family new opportunities in a new state, that still exist today.

>> His father was the first person in Ohio to fracture a well that he believed to be a dry hole with only water and sand, which turned out to be a great well using this new technique. Up until that point, the industry had been using gelled crude oil to shoot back into the well to break it up and he didn’t want to waste hundreds of barrels of that on a dry well.

>> In 1977 in Hocking County in Ohio, men rushed to join the industry because of the tax advantages and the obvious success those already participating were having. But all of that competition meant it was harder to find acreage. A lot of them didn’t know what they were doing which ended up causing a host of environmental issues that would come into play later in their careers.

>> In the 1980s, Ohio had the highest drill rate in the nation with more than 5,000 wells drilled each year. It’s also known for water production with crude and natural gas and managing produced waters became a real issue with so many wells being drilled. Citizens and government officials stepped in to enact House Bill 501, which was highly controversial at the time. The bill primarily focused on banning putting water into pits and mandated that all brine be managed by Class 2 wells.

>> Working under his father, who he fondly labeled Old Guard and old-school, he said he took his role of introducing new technology and ways of drilling the wells seriously because it was something his father couldn’t understand. His father would give him advice about what it took to really be in the oil business. He admired those that kept to themselves, worked hard, honored their commitment and made agreements on handshakes.

He told him one thing that has carried him through his career in the industry for the past 45 years:
“Ninety-five percent of being in the oil business is reputation. Only 5 percent is finding oil. If you’ve got your reputation, you’ll succeed. If you don’t, you will not.”

>> He eventually became involved in OOGA and was appointed to be a regional producer representative and became engaged in the advocacy process. In 1991 he was asked to run the legislative committee. The industry was in a difficult place in Ohio at this time, so it felt like a good opportunity to try something new.

>> Nancy, known for her role as Director of the Department of Commerce under George Voinovich, ordered him over for drinks to talk about his future and outlined how I should apply for the executive vice president position at OOGA, and so he did.

>> His goal with joining the industry was to be known as an aggressive policy advocate. It meant going into the Legislature on a regular basis and make clear that when it came to oil and gas and energy issues, that OOGA was the preeminent voice and that we knew the issues. Several policy issues that were passed that were significant but not highly publicized.

>> In 2005 Stewart decided to take on a highly controversial topic with preemption and dealing with local government. In northeastern Ohio, we were dealing with surface development that was in conflict with well development, which led to unreasonable local regulations which weren’t designed for health and safety, but for the development movement.  The tension was between landowners who wanted access to the mineral rights and their neighbors who didn’t want to be touched by that activity.

A significant court case was happening around this time, State vs Newbury, which decided that Ohio’s oil and gas division had predominant authority over most authority. Local authorities would use certain health and safety exemptions to get around this ruling and essentially ban oil and gas wells.

The bill Stewart began pushing in his role at OOGA was complete state preemption over local decisions on mineral development and it was difficult to get conservatives who believe whole-heartedly in local government on board.

“When they would bring this up with me about local government, I would agree and say, Local government is best, but what’s even more sacred is property rights and you’re forging property rights.”

This bill became House Bill 278, which is unlike what any other state has been able to pass.

>> One of the biggest frustrations in his career has been dealing with people who are against the oil and gas industry but simply don’t understand what they’re arguing against. The concept of energy and how they are using the very thing we’re drilling for in their day-to-day lives, but because it’s oil and gas, it’s wrong. HB 278 brought with it what Stewart now calls “well haters” that came in droves to protest the oil and gas industry.

>> The fracking debate that has sparked in the last decade has become political instead of safety-related and boils down to who should control the resources in the states, and who should benefit from the control over those resources.

>> His biggest fears for the future of the oil and gas industry is that the industry will be regulated to the point that entrepreneurship is a significant factor. Soon the only people who will be able to handle it will be largely capitally-funded businesses. “Being able to successfully navigate the regulatory structure on a federal and state level, is so challenge it often seems impossible to be in compliance with the law, and that’s an authentic threat,” Stewart says.

>>On the flip side, a driving force for the future of the industry is the technology that makes drilling for wells more affordable and successful. Where the limit was once 1,000 ft to test the capacity of reservoirs using wooden rigs, then cable tool rigs came along, then rotary development. Drilling technology made it deeper, safer and gave the industry the ability to find better reserves.
> Operators and producers in Ohio are already beginning to look at how to take the technology being used in horizontal drilling to boost production and how to implement that in conventional wells.

Connect with Tom
Tom Stewart is the immediate past executive vice president of the Ohio Oil & Gas Association, a state-based trade group representing the Ohio oil and gas exploration and production industry (www.ooga.org). In December 2014, Stewart retired from the OOGA after leading the Association since September 1991.

In January 2015, Stewart founded Oilfield Policy Advisors LLC, a firm providing consulting services related to public policy activities impacting the oil and gas exploration and production industry operating within the Appalachian Basin.

Prior to joining OOGA, Stewart had fifteen years of formal experience in the oil and gas industry as an oil and gas producer and provider of contract drilling services. He is the third generation of his family to make a livelihood in the exploration, development, and production of crude oil and natural gas. The family heritage extends back to the original oil regions of western Pennsylvania and southeastern Ohio. Stewart currently is a board director for Stewart Brothers, Inc., an Illinois-based family partnership that manages non-operating oil and gas working interests in four states.

#003: How COPAS Transformed Mike Cougevan’s Career


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What do nearly 40 years in the oil and gas industry look like and how do you keep interested in what you’re doing year after year?

Mike Cougevan, oil and gas auditor for Martindale Consultants has been in the oil and gas industry for 37 years and happened upon his career choice by accident.

With no firm plan to retire (unless he wins the lottery), Cougevan has gotten to know the industry from the inside out thanks to his active role at COPAS (Council of Petroleum Accountants Societies) and his storied career in finance, revenue accounting and now auditing.

After getting a finance degree, one of the first interviews was with Conoco, Amaco and a couple of banks. Simply because Conoco seemed to offer the best job and have a strong growth plan, he accepted the position without knowing anything about the oil business.

Some of his roles have included working on the AFE desk as financial analyst handling operating expense budgets for the field, creating and getting AFEs approved with the non-operators, profit loss analysis for the fields.

He spent time in Midland, Texas, and managed revenue accounting before being transferred to Lafayette, La., to be in charge of non-operated properties in the Gulf of Mexico which included scheduling and handling audits, negotiation agreements and paying JIBs.

When the company began restructuring in the 90s, Cougevan didn’t love his relocation opportunities and began working for Martindale Consultants, and took on an active role with COPAS.

His recommendations for making the most out of an oil and gas career are to join COPAS and embrace the quick technology changes in the industry.

What in the world is COPAS?
COPAS is unique in that its an organization that writes its own rules and then goes and implements them. Originally started to maintain how accounting was handled for the industry across the states.

It’s not only ideal for accounting and finance professionals, but also small and large independent producers and operators who want to understand if what they’re being told and how they’re running their books is correct.

Benefits of getting involved in COPAS are:
– You understand exactly how to do your job to the best of your ability and accurately.
– You know the nuances and details of what’s included in the Account Procedures and what language is not used and why
– You’re among all the peers in your industry that you’ll be working with for many years if you make a career out of oil and gas

Cougevan helped to write the 2005 Accounting Procedures over a 2.5 year period. He fell in love with the ability to create history and build a document that would solve all the problems the industry faced in earlier accounting documentation that was now outdated because of technological advances.

To this date, no one has been able to find a hole in the document or something that the team forgot to address.

In his time in the industry Cougevan has experienced:
> Carbon paper
> No computers
> Lotus 123
> No copy machines

to now being able to
> Communicate with the wells with
> Use drones to use inspect well sites that pumpers used to have to do
> Increased efficiency thanks to powerful software and tools
> Technology that changes how we find and drill for oil and gas

“It’s so fast, it’s hard to keep up with,” Cougevan said.

Today he works as an auditor that focuses on contract compliance, which basically means anytime there’s a contract in the upstream or midstream sectors, he could be called in to make sure the terms are being held.

“It’s a normal part of a business, but it’s inherently confrontational,” Cougevan said. “It’s also good business sense to kick the tires and do some type of review or get down in the weeds if you’ve had problems with that type of operator to protect your company assets.”

What keeps it interesting nearly 25 years since beginning to audit, is that every job is new.
“It’s like looking at a new jigsaw puzzle every time to look at what the contracts are, look at both sides and what’s happening and determine quickly if it’s correct or not,” he said.

The biggest change he’s seen in his auditing career is that most operators are digital, so he doesn’t have to travel and dig through a paper trail.


Resources Mentioned:

COPAS

Connect with Mike: 
Martindale Consultants

Mike began his Martindale career in 1995 and is a Vice President of the firm. He provides senior leadership, expertly manages clients’ joint venture compliance and other projects, and shares his extensive industry experience and knowledge with Martindale employees. Mike also provides expert witness and litigation support and been certified as an expert in numerous State courts and in Federal court. Mike previously worked for Conoco (now ConocoPhillips) for 13 years in various positions, including financial analysis, internal reviews, managing non-operated properties, negotiation of agreements, and settlements of joint interest and revenue disputes.

Mike has provided the additional foundation to manage and provide clients with exceptional quality in our compliance reviews. Mike is considered a prominent authority on Gulf of Mexico joint venture accounting issues and has performed international reviews in Australia, Barbados, and Brazil.

Mike’s expertise includes:

  • Testifying as an expert witness in State and Federal court on subjects including joint venture claims and custom and practice in applying exploration agreements, joint operating agreements, and Accounting Procedure provisions in oil and gas operations
  • Overseeing compliance reviews for U.S. and international joint venture projects
  • Overseeing compliance reviews for Gulf of Mexico shelf and Deepwater joint venture projects
  • Overseeing client in-house projects on COPAS Accounting Procedure applications for various joint venture issues
  • Assisting clients in resolving complex joint venture issues for both operated and non-operated ventures.

Mike has actively served in various capacities in the Council of Petroleum Accountants Societies (COPAS). COPAS positions held include:

  • President of COPAS
  • President of COPAS of Acadiana
  • Chair of COPAS of Acadiana Audit committee
  • Chair of the COPAS National Audit committee
  • Chair of the COPAS Emerging Issues subcommittee
  • Two terms (six years)as Director on the COPAS Board of Directors
  • Chair of several COPAS publication Drafting teams
  • Key participant in drafting the COPAS 2005 Accounting Procedure
  • Member of more than 12 COPAS publication drafting teams
  • Recipient of the 2004 COPAS Eagle award
  • Developer of the Knowing Your COPAS Documents (KYCD) educational series
  • Participant on several COPAS special committees and task forces

Mike is an experienced speaker on joint venture oil and gas topics for both public and private audiences and has given presentations to more than 20 different organizations

Check out the prior episode: #002: After 41 years, Roy Jackson has the key to surviving in the oil and gas industry

#002: After 41 years, Roy Jackson has the key to surviving in the oil and gas industry


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For the past 41 years Roy Jackson, CEO at Energy OnRamp, has been involved in the oil and gas industry and made a name for himself as a someone who can make and create deals between buyers and sellers.

In today’s episode, we asked Roy what is the key to lasting so long in the industry when it’s such an up and down adventure.

As you hear Roy speak, one gets the feeling that he was born to sell, which explains how he’s made a career out of connecting buyers and sellers in any part of the industry. Beginning at Schlumberger in the 70s, and moving into the oil and gas software space in the 1990s, Roy began to notice that his role in the industry was more than connecting people to solutions.

Solutions were no longer enough. He had to help them make the best decisions for their business if they’re going to survive.

“Energy companies are generating a large amount of data,” Jackson said. “You have these entrepreneurial guys who are getting private equity capital from somewhere, buy assets and then all of a sudden, along with the closing of that deal, they realize they don’t have any assets, and in 60 days we’re going to have to do revenue distribution and joint interest billings.”

These entrepreneurs would have to go hire someone and train them on the basics of the industry, and then everything around setting up that company revolved around regulatory reporting for the state and for setting up revenue distributions, he said.

“I was discovering that people never truly got the system set up correctly years later after running into them and that they never knew how to set up the management and reporting system the way they wanted to,” Jackson said.

Now they were going to throw everything out and start over on a new system.

To expedite or stop businesses from going through the long and excruciating process, he said, he started his new consulting firm Energy OnRamp to help companies take their financial data, get it into a system that works for them and help them understand how to present that data so its “attractive for bank capital, a private investor or whatever it takes to drill and capture the kind of opportunities that come in the energy industry,” Jackson said.

“Our team gives your business the tools within your own system or another system so that you can get the info you need to get the capital you need, and to make better management decisions to manage the multi-million dollar assets.”

As we know in the industry, wells aren’t cheap to drill.

Unconventional well plays cost millions of dollars to operate, displacing many smaller independents from participating. Like what we’re seeing with our own clients in the industry, many operators are selling wells because they are reaching retirement age and there is not generation coming up behind them to take over, so they’re forced to sell.

On the flip side, a lot of wells are either combining with bigger forces to go all in on unconventional plays or picking up conventional wells that larger companies are offloading to support these unconventional drills, and find themselves suddenly with new wells to operate 30-60 days after purchase.

So what makes a company able to stay afloat, even when oil prices skyrocket above $100/bbl or plummet to $9/bbl?

Roy’s answer: “The simple answer is that you just have to stay.  I can’t tell you the number off landmen and geologists, that sacked groceries at Wal-Mart when Midland was not near as prosperous, but they’re reaping big-time benefits for being patient. Stay and find a new way to make a living during the slow down period.

“What we’ve been doing in Midland for the past 40 years is to figure out how to stay in the oil and gas business. Oil and gas people are some of the best entrepreneurs. It makes me proud to be in the oil and gas business.”

Connect with Roy Jackson: 

Based in Midland, Texas
432-253-3337
Roy Jackson is the founder of Energy OnRamp and over his 41-year career in oil and gas has demonstrated the ability to develop opportunities for his clients.

Starting his career in “the patch” in 1977, Roy started developing his energy network with tenures at Schlumberger, National Oilwell (Bowen) and Homco International. He has directed the sales and marketing efforts at energy software companies involved in upstream accounting, including Midland Southwest Software (OGAS) and WolfePak.

Mr. Jackson has extensive experience in the acquisitions & divestment of oil and gas assets. Jackson has successfully completed over 200 transactions, totaling over one half billion dollars in oil and gas upstream, midstream and service-related assets. He was the co-founder of Capital Energy Advisors and Simon Energy Advisors. Jackson also was formerly a principal partner at Simplex Energy Solutions in Midland, TX.

Roy is a member of PBPA, ADAM Permian, and SPE. He is also past chairman of FEPA, a Permian focused networking forum for the Energy Industry.

Energy OnRamp consults on accounting, production, and anything bringing data in from the field and anything that is back office related to running an operating, service or midstream company.

Listen to the previous episode: #001: How the Oil and Gas Industry Survives Year After Year

Check out the next episode: #003: How COPAS Transformed Mike Cougevan’s Career

#001: How the Oil and Gas Industry Survives Year After Year

Twenty-five years ago, co-host Phil Sherwood, started a software company called SherWare, Inc. to optimize the accounting and distribution processes for oil and gas operators to save them time and money, two things we need plenty of in the oil and gas industry.

When he started the business, the price of oil was around $15 a barrel and over the course of his career, it’s gone down to $9 and as high as $100.

Through all the ups and downs, We’re Still Here, and like so many clients and friends in the industry — so are you.

So what makes a business be able to withstand the unpredictable market conditions? What characteristics does the CEO have to have? What are the tactics and secrets they’ve used to be successful no matter what?

This is exactly what we want to uncover and inspire on this podcast.

Each episode will feature guest interviews and episodes to showcase the best and brightest in the industry and find out how they’ve thrived in a volatile market and what the future of the industry looks like to them.

We’ll also be showcasing business ideas, tips, tricks for scaling and growing — you happen to be in the oil and gas industry, but you’re running and growing a business and in order to continually expand, you have to think differently and be ready to grow with your team.

At the end of the day, we want you to be able to say, “We’re Still Here” no matter what happens around you.

Check out the next Episode: #002: After 41 years, Roy Jackson has the key to surviving in the oil and gas industry