VOLUME XXXXVII NUMBER 1 AUGUST 2010

See Page 24 for information on the SIPESSIPES Guadalupe Mountain Fossil Guide QUQUARARTERLTERLYY www.sipes.org

Society of Independent Professional Earth Scientists

 SIPES Foundation President’’s Column Positive Attitude Raffle Winners — See & Responses Page 17  AGI Geoscience Kenneth J. Huffman, #2936 A Defensive Against Oilfield Salaries Chart — New Orleans, Louisiana Gloom and Doom See Page 18 It is official. As of the by Russ Hensley, #2870 — Rockwall, Texas  2011 Convention end of the meeting in Advertising — See Colorado, I have suc- Note: This article is from the Fort Worth Page 25 ceeded Bill Finley as Chapter, and is the fifth in a new series submit-  New SIPES president of the nation- ted by SIPES Members and Chapters. Foundation Films — al organization for 2010- Introduction See Page 27 2011. We all know that For decades, all of us in the oil and gas members of SIPES are industry have been cast as "villains of the Ken Huffman scientists who are inde- environment," supply conspirators hoard- pendents in the oil and ing for higher profits and likely directly gas industry. It is an organization that runs responsible for the high cost of fuel and all on the hard work of the national office and other forms of hydrocarbon products. The the volunteering of its membership at the In this issue: early appearance of this general govern- local levels. It has been my observation, mental and public attitude toward the oil while serving my term as director for the Industry Information 2 and gas industry can be traced to the 1973 New Orleans Chapter, that the past presi- oil embargo, the shortage of gasoline, the dents I have had the privilege to work Cornerstone Group 6 enactment of Windfall Profits Tax and the with (Bill Finley, Jack Naumann, George formation of the Department of Energy News of Members 7 Johnson, Mike Austin) exhibit not only sci- during the Carter administration. The entific expertise in their areas, but the growth of a negative view of the oil and Chapter News 8 human characteristic of wanting to leave gas industry has fluctuated depending on this a better place than they found it. the strength of the desire and action by the SIPES Gifts 11 Perhaps it is the nature of the organization government to nationally control energy. to attract such individuals, or it is the indi- From every single president since Richard Chapter Meeting Info. 13 viduals that uplift the organization. I am Nixon, we've heard noble promises and grateful to have served with them on the In Memoriam 14 inspirational rhetoric about the conserva- board over the past few years and hope I tion of fossil fuels and various goals to can carry on their high standards. Directory Corrections 18 achieve U.S. energy independence. The 47th Annual Meeting and Here we are a full career later, nearly four New Members 21 Convention was held at the Cheyenne decades post-embargo with the Depart- Mountain Resort in Colorado Springs. My ment of Energy employing tens of thou- Technology Corner 22 compliments to the Denver Chapter and sands, and spending billions, but our the Convention co-chairmen Mike Austin dependence on imported oil has not Foundation Donors 26 and Bill Goff for assembling a great slate of declined, now rising to almost 70%. The diverse and interesting speakers. Dr. number one supplier is our northern Board of Directors 28 Harrison Schmitt delivered a very enter- neighbor Canada followed in order by taining and informative presentation for Saudi Arabia, Mexico, Venezuela and the Foundation Seminar on his lunar Nigeria. Currently, Carol Browner, the (Continued on Page 16) (Continued on Page 19) National, State & Environmental Information

The following reports on national and environmental issues record. Unfortunately our government's reaction is to will be presented to the SIPES Board of Directors at the board engage in a political blame-game and a full-fledged retreat meeting on October 5-6, 2010. Vice President of National Energy from offshore drilling. The end result is the loss of thou- Marc D. Maddox, authored the National Energy Report, and Sue sands if not hundreds of thousands of jobs along the Gulf Cluff submitted the Environmental Committee Report. The Coast, and an acceleration of the terrorist subsidy program views and opinions expressed are those of the authors. Some of the that sends U.S. dollars overseas to purchase the oil that we information presented is in the public domain and is available will need. As we go to press, Diamond Offshore from a variety of sources; other references were selected by the announced that its Ocean Endeavor deepwater rig is mov- authors, and are noted on their reports. ing from the Gulf of Mexico to Egyptian waters, with  NATIONAL ENERGY Devon paying a $30 million early termination penalty. What we need is leadership in Washington that attacks the Even in a weak global economy the demand for oil is issue with optimism and energy, and responds to the spill expected to increase by 1.3% in 2010. The International with constructive solutions that clean up the mess, pre- Energy Agency predicts that daily global demand for oil in serve jobs, and keep domestic reserve replacement on 2010 will be 87.8 million barrels, with China being the pri- schedule. mary growth market. Following are some major issues that Frac fluid disclosure will continue to be the main point of are taking shape heading into the second half of the year. attack from anti-industry groups (see page 19). The enviros The Macondo blowout continues to dominate the head- are attacking on this issue, but the oil companies are head- lines. Fallout from this tragic event will shape U.S. energy ing it off by disclosing the chemicals used in fracing wells policy going forward. The saddest part of this sad tale is (see Range article in the Wall Street Journal on July 14). It that the industry is taking a beating after drilling thou- turns out that 98.5% of frac fluid is dihydrogen monoxide sands of wells offshore since the Santa Barbara incident - commonly referred to as H O. No matter that wells have forty-one years ago with a near-perfect environmental 2 been fraced for decades. Contamination of water wells and urban legends of exploding houses are being used to incite fear in the public to gain support for national regulation of fracing. The obstructionists request that a federal permit be SIPES Headquarters required for fracing any well. That ought to lower cost and 4925 Greenville Avenue - Suite 1106 streamline the process of drilling wells! Dallas, Texas 75206-4019 New EPA emission standards for CO2 were released on July 6. This amounts to an expansion of power of the fed- Telephone: 214-363-1780 Fax: 214-363-8195 eral government over local governing authorities. It is the http://www.sipes.org E-mail: [email protected] initial strike in an effort to vilify coal miners and the gen- eration of electricity by burning coal. Coal-fired plants sup- ply roughly 48% of the electricity generated in the U.S. Next year new standards will also be released for mercury levels. These are aimed directly at the coal industry as well. Executive Director ...... Diane Finstrom Activists are quite adept at "divide and conquer" tactics. Admin. Assistant ...... Katie Ruvalcaba They are actively working to form a coalition of energy and environmental interests to derail coal as a power Member Services ...... Ann Davis source. More comments on this to follow below. That the current administration in Washington is aggres- 2010-111 Board Meeting Dates sively expanding its power over the states and every October 5-6, 2010 ...... Oklahoma City, OK aspect of daily life is unquestionable. This is manifest in the appointment of Al Armendariz as director of the Region 6 January 19-20, 2011 ...... New Orleans, LA office of the Environmental Protection Agency. Region 6 encompasses five states including Texas and one-half of 2011 Annual Meeting Dates the nation's refining capacity. In May the EPA flexed its June 20-23 ...... Jackson Hole, WY authority by pulling an air permit issued by the Texas Commission on Environmental Quality (TCEQ) for the The SIPES Quarterly is published by the Flint Hills refinery in Corpus Christi. This 300,000 barrel Society of Independent Professional Earth Scientists. per day refinery has been operating since 1952. Since 1981 more than $2.8 billion has been invested to keep the refin- Send your comments, letters, address changes and advertising ery compliant with TCEQ requirements. In doing this, EPA inquiries to the SIPES Headquarters in Dallas, Texas. has usurped Texas law. Armendariz further expanded EPA (Continued)

2 ______SIPES QUARTERLY National, State & Environmental Information Continued authority on June 30, when final disapproval for Texas flex- The theme that pervaded the conference is that with the ible permit program was announced. The claim is that advent of shale gas plays, the United States has gone from Texas clean air quality standards do not meet national stan- a natural gas deficit to one of abundant supply. This is the dards. TCEQ is challenging that ruling in the federal court presumption that most of the speakers held, and especial- of appeals. Not only are thousands of refinery jobs at risk, ly the politicians. This perception is being reinforced by but the market into which producers sell their crude oil is the claims of public companies. For example, Encana being threatened. claims to have 23,000 shale gas locations to drill. Other Energy Epicenter Conference public companies made similar claims. If all are to be believed, there are over 100,000 shale gas locations inven- Two weeks after the SIPES Annual Meeting in Colorado toried to drill in the United States! Speakers were almost Springs, I returned to Colorado to attend the Colorado Oil giddy with the prospect of a 100-year natural gas supply, and Gas Association's Energy Epicenter conference in and the many possibilities this presents. Some of the more Denver. Several state and national political figures gave far-reaching ideas were that the U.S. will become a gas speeches including Senator Orrin Hatch of Utah; former exporting country; that the abundance of natural gas will Colorado Senator Tim Wirth, who is currently president of alter the economies of Caribbean basin nations by reduc- the United Nations Foundation; Robert Kennedy, Jr., attor- ing their energy costs (the example given was that Mexico ney and award-winning author; and the three candidates could save $10-$11 billion per year for electricity genera- tion); and the possibility of "un-yoking" Europe from the clutches of Gazprom as the Russians will no longer be able to hold Europe hostage to gas supplies. These are truly huge geopolitical implications, but are we getting ahead of ourselves? Art Berman, #3062, former columnist at World Oil and now head of Labyrinth Consulting Services made the fol- lowing statements:

 Most shale plays are marginally economic at best. Senator Orrin Hatch Senator Tim Wirth Robert Kennedy, Jr.  Cumulative production curves don't match the claims being made for ultimate recovery by operators. for governor of Colorado: Repubicans Scott Mcinnis and  The hyperbolic exponent of 1.67 used by these compa- Dan Maes, and Democrat John Hickenlooper, currently nies exceeds the normally acceptable factor of 1.0. mayor of Denver. Honorable Ellen Roberts, Colorado State  Rather than the hyperbolic model generally utilized by Representative from District 56 was also a speaker, as were public companies, the more accurate model might be a the CEOs of several large public companies; research asso- transient decline followed by an exponential decline, simi- ciates for Wood MacKenzie; representatives of MIT Energy lar to that used for fractured reservoirs, i.e., the Austin Institute; and others from all sides of the energy, environ- chalk. mental and political spectrum. It was truly an eclectic gath-  Use of a PV10 would negate 50% of reserves, as they ering and a wide range of views and opinions were given could not be produced profitably. voice. The comments in the balance of this article are some  Public companies are understating costs and overstat- generalizations reached by the author at the conference ing reserves. that pertain to the political and business climate affecting Donald Hertzmark with DMP Resources offered a great the oil and gas business. historical perspective: Colorado is an interesting venue for this conference as it  Five years ago the prevailing views on natural gas has been the focus of a concentrated effort to step up reg- were: ulatory oversight of the oil and gas business over the past  North American gas supplies are headed irre- four years, since the election of current Governor Bill Ritter versibly down. and a left-leaning legislature in 2006. This resulted in a  LNG was needed to make up depleting deliver- complete overhaul of the state oil and gas commission that ability and thus was headed up. has been largely unfavorable to oil and gas operators. The  There were 120 active coal power plant permits. end result of the heavy-handed treatment has been the  Today this is how we see things loss of jobs to the state, and a decrease in oil and gas activ-  Shale gas in inexhaustible. ity, even prior to the economic downturn in 2008. Largely  We can export our expertise in producing gas because of this issue, Governor Ritter is not running for re- from shale overseas and continue the party. election as he has no chance of winning. Unfortunately the  Who needs LNG? damage has been done and re-writing the rules will be dif- ficult. Sound familiar? (Continued)

AUGUST 2010______3 National, State & Environmental Information Continued

 There are now only 60 active coal power plant permits. This is due to rejection of permits by bureaucrats and withdrawal by operators on environmental concerns.  Shale gas has developed rapidly because it is located on private land.  The potential energy source from shale gas far exceeds the north slope.  Excessive regulation has been ignored by the federal government (so far).  Shale gas is America's gift to the world.  Foreign capital is flooding into the U.S. to finance these plays for profit and knowledge.  Historical geopolitical consequences. The dynamics are fascinating. Random Thoughts  CAUTION: WASHINGTON IS COMING TO THE PARTY!  The advent of shale development is causing a realign-  Look Out! Lawsuits and Regulations are a big ment of international relationships and political status unknown. Folks who don't like shale gas are waiting for quo. the opportunity to strike!  Shale gas is transforming and disrupting the U.S. gas  The U.S. needs 2.5 Tcf/year added deliverability just to market. It is creating new paradigm – we are no longer replace coal plants that will be retiring due to age and new worried about gas supplies. The theme is that because of regulations. Permit denials for new coal-fired plants are the advent of shale gas plays the U.S. now enjoys a 100- aggravating the situation. year supply of natural gas.  European shale gas production will rise slowly – they  While the enviros are not capitulating on capping CO2, lack the technology and infrastructure the U.S. has. they are hedging their bets by expanding the issue to The Plot to Kill the Coal Industry include mercury emissions. They have to reinvent a way to attack the coal generators. Mercury is the new bogey man. It was interesting to hear Robert Kennedy, Jr. speak. His I had never heard this before this conference and it was a opposition to the Cape Wind project has stalled that recurring theme: the new scare tactic to rally the troops "renewable" energy project by ten years, and compromised around the abolition of coal fired power plants. his status as an environmentalist by exposing the "not in  All operators claim large cost reductions as they climb my backyard" hypocrisy prevalent in many leading envi- the learning curve, making statements that they can drill a ronmentalists. What was really interesting was to hear him Haynesville shale well in 22 days. Active rig numbers tout- make a case for the natural gas players to join with envi- ed are way up as well. So the question is: if you have six ronmental groups to kill the coal industry! Industry out- rigs running in a play and can drill a well in 22 days why siders make a distinction between the oil and gas parts of aren't there more producing wells? the industry: oil = dirty = big oil company = BAD; gas = clean energy = GOOD (for now anyway). His appeal was Closing Comments to paint the coal industry as evil in the context of strip Part of the reason coal is so prevalent as a fuel for electri- mines and CO2 emissions. He spent a lot of time talking cal generation is because in the late 1970s government about mercury emissions and how the coal companies "experts" predicted that there was only a five-year supply were putting all the fish and unborn children in the United of natural gas left. This resulted in Jimmy Carter's morato- States at risk. This is the fear element that will be used in rium on the construction of new natural gas-fired electrical the coming year to try to shut down the coal industry, power plants. Now coal is bad, and gas is the savior. In though it is uncertain what link there is between burning reality, the picking of "winners" and "losers" for the source coal and mercury emissions. The olive branch being of fuel causes massive disruption and therefore distortion extended to the natural gas industry is that we have a com- of the free market. (where would gas prices have been mon cause with the environmentalists because natural gas throughout the 1980s if this ban were not in effect?) Coal offers a clean alternative to coal as a source of electricity usage was further encouraged (and the market further dis- generating fuel. Kennedy and others at the conference torted) by massive railroad subsidies. The end result is that unabashedly are saying that if the natural gas producers Houston, Texas, gets a significant part of its electricity by will join with them to shut down coal, the gas industry can burning Wyoming coal, as does West Texas. grab this market share and enhance domestic demand for natural gas. These are the same people who think renew- (Continued) able energy can displace oil imports.

4 ______SIPES QUARTERLY National, State & Environmental Information Continued

We were asked at this conference to align with the envi- mented plumes of underwater contamination. Instead of ronmentalists and liberals to shut down the coal industry rising to the surface, some components of the oil are – to "select" out coal. The real solution is to quit manipulat- becoming diluted in the ocean 1,000 to 3,000 feet below the ing the market and let the market work it out. If all the surface. The water may appear clean, but smells oily and money spent on wind and solar were directed instead to contains dissolved hydrocarbons in fairly low concentra- developing and building nuclear power generation it tions. Since this is a new phenomenon, no one knows how would go a long way toward solving our energy indepen- this will impact the ocean. Biologists are concerned that dence problem. Meddling with markets via subsidies, larger predators are going to be ingesting toxins. Also, the mandates to purchase energy from "renewable" sources, underwater plumes may decrease the oxygenation in the and taxation of carbon emissions, lead to inefficiency and plume areas, causing dead spots in the ocean. massive misallocation of capital. Simply stated: the dollars The use of dispersants underwater has been very con- and intellectual effort being put today into the construc- troversial; there has not been much testing on the wide- tion of wind farms would be much better spent building spread use of dispersants prior to the spill. There are and perfecting nuclear power plants. claims that the dispersant itself may be toxic. BP believes The U.S. currently generates 22% of its electricity from that it is similar to household detergent, and it has been nuclear sources. There are roughly 350 nuclear power approved by the Coast Guard. The Coast Guard has limit- plants worldwide. Of these, 104 are located in the United ed the amount of dispersants used in the cleanup. Are the States. There are approximately 340 new nuclear power dispersants preventing the hydrocarbons from rising to plants planned worldwide. Only one of these is in the the surface? The situation is new and the effects unknown. United States. The U.S. was the leader in the nuclear A biologist who has studied the effects of the Ixtoc power industry in 1950. Today we are dead last. What is blowout on the Mexican Gulf Coast in 1979, Dr. Tunnell, most needed however, is leadership in Washington with watched 80% of the bottom dwelling creatures die off in the same positive "can-do" attitude that put the U.S. on the nearby Texas. He says that he was amazed that in a few Moon in one short decade. With the right focus and inten- years, the coast had totally rebounded, no evidence of the sity there is no doubt that the United States can develop spill, with the same healthy, diverse, biota that existed solutions to the problems inherent in nuclear power gen- there prior to the spill. He pointed out that since the Gulf eration and once again lead the world to a brighter future. is subjected to constant natural seeps into its warm waters,  ENVIRONMENTAL COMMITTEE REPORT it has developed microbes adapted to break down oil and eat it. In the warm temperatures of the Gulf, microbes are As of July 16, 2010, the Macondo BP well has been more likely to flourish than in the cold waters of Alaska. capped and no more oil or gas is leaking into the Gulf of On July 28, 2010, the New York Times reported that the Mexico for the first time since the explosion of the surface oil slick has dissipated much faster than anyone Deepwater Horizon on April 20. Since the blowout was in anticipated, and is essentially gone two weeks after the 5,000 feet of water, the rate of flow through the broken temporary cap was emplaced. Scientists point to a combi- pipe could only be estimated from underground pictures nation of factors — microbial consumption of oil, storm from remote operated vehicles (ROV). Estimates of the dispersion of surface oil, and the huge armadas of ships total amount leaked range from 80 to 180 million gallons. skimming, burning, and scooping. As much as 40% of the There is no denying that this is a truly monumental envi- surface oil may have evaporated. The oil was reported by ronmental disaster. BP to have an API gravity of 37 with lots of volatiles. The Some of the pictures are familiar — oiled birds stuck in marshes and beaches will still require cleanup, and the the mud, and tar balls washing up on the beach. Booms government will continue to investigate the underwater have been deployed along the coastlines and oily scum has plumes. been sucked up and burned, but unfortunately weather The lasting effects of the spill on the environment are and waves have washed oil into wetland and marshes of hard to gauge at this point since this spill had been like no Louisiana. The Louisiana marshes had already been under other. One thing is for certain, the effect on the exploration stress from human activity (dams, development, dredging, and production of oil in the Gulf of Mexico and the rest of etc.) and there is worry that the oil spill will increase the the United States will be immediate and unpleasant. The rate of erosion because of damage to plant life. Fishing is EIA estimates that the moratorium will reduce oil produc- closed along 84,000 square miles of the Gulf, and the eco- tion by 31,000 b/d in the fourth quarter of this year. And the nomic impact on life in this area is huge. resulting regulation changes and legislation are just begin- Yet the fact that this spill is in deep water makes this sit- ning. uation different from previous spills, and therefore harder  to anticipate the damage. Researchers from the University of Georgia and the University of South Florida have docu-

AUGUST 2010______5 2010-2011 SIPES CORNERSTONE GROUP Many thanks to the members listed below for their continuing support of our society

Michael G. Cruson — Golden, CO Deborah K. Sacrey — Houston, TX  Oil Finder – $1000 Ralph J. Daigle — Houston, TX Richard H. Sams — Atlanta, GA Michael N. Austin — Broomfield, CO Edward K. David — Roswell, NM C. Randall Schott — Houston, TX William C. Burkett — Midland, TX Herbert G. Davis — Edmond, OK George D. Severson — New Orleans, LA Stewart Chuber — Schulenburg, TX Lawrence Davis — Oklahoma City, OK D. Craig Smith — Midland, TX Scott G. Heape — Addison, TX C. Walter Dobie — Lafayette, LA Daniel L. Smith — Houston, TX Kenneth J. Huffman — Mandeville, LA Douglas A. Draves — San Antonio, TX Thomas J. Smith — Oklahoma City, OK H. Jack Naumann, Jr. — Midland, TX Duncan D. Dubroff — Houston, TX Paul M. Strunk — Corpus Christi, TX Michael A. Pollok — Purcell, OK Ralph C. Duchin — Tucson, AZ John F. Sulik — Corpus Christi, TX Harry Ptasynski — Casper, WY James P. Evans III — Franklin, LA C. Al Taylor, Jr. — Reston, VA John E. Scherer — Midland, TX Thomas E. Ewing — San Antonio, TX Robert E. Tehan — Oklahoma City, OK Thomas A. Smith — Houston, TX David A. Eyler — Midland, TX Michael R. Vasicek — Midland, TX Charles Weiner — Houston, TX Robert B. Ferguson — Lake Forest, CA William Von Drehle — Wheat Ridge, CO  Driller – $600 Dennis M. Gleason — Arlington, TX Scott A. Wainwright — Metairie, LA Avinash Ahuja — Corpus Christi, TX William T. Goff III — Littleton, CO H. Vaughan Watkins, Jr. — Madison, MS Wilbur C. Bradley — Wichita, KS Bobby M. Greenwood — Dallas, TX Larry R. Wollschlager — Midland, TX Arlen L. Edgar — Midland, TX Edward W. Heath — Durango, CO John D. Wright — Golden, CO William R. Finley — Lafayette, LA Donald R. Hembre — Littleton, CO Steven P. Zody — Wooster, OH Donald C. Gifford — Dallas, TX James H. Henderson — Dallas, TX James M. Zotkiewicz — Metairie, LA Patrick J. F. Gratton — Dallas, TX Albert R. Hensley — Rockwall, TX  Investor – $100 Frank W. Harrison, Jr. — Lafayette, LA Terry L. Hollrah — Oklahoma City, OK Donald I. Andrews — Metairie, LA Owen R. Hopkins — Corpus Christi, TX Gary C. Huber — Centennial, CO Michael P. Arden — Navasota, TX Peter MacKenzie — Worthington, OH George S. Johnson — Amarillo, TX Norman K. Barker — Midland, TX Marcus D. Maddox — Midland, TX Ralph O. Kehle — Durango, CO Teresa H. Becker — Houston, TX Fred L. Oliver — Dallas, TX Scott Laurent — Houston, TX William D. Bennett — San Antonio, TX Stephen D. Reynolds — Denver, CO Robert C. Leibrock — Midland, TX Richard S. Bishop — Houston, TX A. Scott Ritchie — Wichita, KS J. Phil Martin, Jr. — Houston, TX Raymond N. Blackhall — Spring, TX Eugene R. Sidwell — Amarillo, TX Roger L. Martin — Wichita, KS Foy W. Boyd, Jr. — Midland, TX Gene Van Dyke — Houston, TX Christophe G. Mazzini — Dallas, TX Raul F. Brito — Wichita, KS Clifford A. Walker — Dallas, TX Douglas McGinness II — Wichita, KS Garnet W. Brock — Midland, TX Gerard J. Medina — Norman, OK  Prospector – $300 Robert A. Cooksey — Richardson, TX George Mitchell — The Woodlands, TX Craig F. Anderson — Houston, TX Douglas Cummings — Oklahoma City, OK Marvin A. Munchrath — Lafayette, LA Robert W. Anderson — Houston, TX Jacob D. Eisel — Boulder, CO Patrick A. Nye — Corpus Christi, TX Thornton E. Anderson — Wichita, KS Cliff J. Fontenot — Brenham, TX Robert B. Owen — Corpus Christi, TX Donna Balin — San Antonio, TX Roger A. Freidline — Midland, TX Arthur J. Pansze, Jr. — Arvada, CO James B. Bennett — Houston, TX Eduardo Gonzales — Carrollton, TX Lloyd K. Parrish, Jr. — Wichita, KS Arthur E. Berman — Sugar Land, TX Peter G. Gray — Lafayette, LA Hugh C. Pendery — Dallas, TX Paul William Britt — Houston, TX Harold W. Hanke — Oklahoma City, OK Sam H. Peppiatt — Houston, TX Johnnie B. Brown — Midland, TX J. Donald Haynes — Wimberley, TX Lee M. Petersen — Weatherford, TX Leonard E. Bryans — Dallas, TX Marc H. Helsinger — Sugar Land, TX Ronald W. Pritchett — Centennial, CO Lanny O. Butner — Wichita, KS W. Ralph Holloway — Dallas, TX John M. Rakowski — Florissant, CO Brian S. Calhoun — Corpus Christi, TX Van Howbert — Midland, TX William M. Raymond — Wichita, KS James S. Classen — Boise, ID J. D. Hughes — Austin, TX Julius M. Ridgway — Jackson, MS Rex D. Coppedge — Fairview, TX (Continued) James D. Robertson — Fort Worth, TX

6 ______SIPES QUARTERLY News of Members

The Gulf Coast Association of Geological Societies will hold its 60th Annual Convention this October in San Antonio, Texas. The following SIPES Members will be rec- ognized for their service to GCAGS and the geoscience profession on Sunday, October 10: Thomas E. Ewing, #1610, of San Antonio, Texas will be awarded GCAGS Honorary Membership.  Steve H. Hill, #1643, of Houston, Texas and Richard H. Ed Picou Perry Roehl Sams, #1026, of Atlanta, Georgia will both receive 2010 GCAGS Distinguished Service Awards. The 2010 GCAGS Don R. Boyd Medal for Excellence in Gulf Coast Geology will be presented to Edward B. Picou, Jr., #2218, of New Orleans, Louisiana.  Perry O. Roehl, #1136, of San Antonio, Texas is a recipi- ent of the 2010 GCAGS Outstanding Educator Award.  Please email [email protected] with additional news of SIPES Members. Tom Ewing Steve Hill Dick Sams 

Cornerstone Group Continued

C. M. Jacobs — Mandeville, LA Mike Shafer — Houston, TX Monty J. Gist — Midland, TX Michael S. Johnson — Denver, CO Clifford H. Sherrod, Jr. — Midland, TX William F. Grauten — Midland, TX Larry L. Jones — Houston, TX Carol M. Shiels — Kaufman, TX David R. Grogan — Woodbine, MD William M. Kazmann — Richardson, TX Delmer L. Sloan — Midland, TX William R. Guffey — Dallas, TX Robert W. Luker — Corpus Christi, TX Marvin L. Smith — Houston, TX James M. Hancock, Jr. — Stafford, TX Donald J. Malone — Wichita, KS William M. Smith — Houston, TX Stephen F. Hennigan — Lafayette, LA Robert H. Marshall — Midland, TX Stephen A. Sonnenberg — Golden, CO Nolan Hirsch — Midland, TX Jack P. Martin — Lafayette, LA Marion E. Spitler — Carrollton, TX Charles R. Jones — Midland, TX Robert Maxwell, Jr. — Corpus Christi, TX Jerry S. Stokes — Fort Worth, TX Susan M. Landon — Golden, CO Lon A. McCarley — Englewood, CO Richard W. Thompson, Jr. — Plano, TX William E. Laroche — Dallas, TX Eric L. Michaelson — Midland, TX George W. Todd — Gainesville, TX Nina C. Lian — Houston, TX James F. O’Connell — Amarillo, TX C. G. Tyner — Houston, TX Steven R. Lockwood — Austin, TX F. X. O’Keefe — Denver, CO Joe T. Vaughn — Oklahoma City, OK Jeffrey W. Lund — Houston, TX Lewis M. O’Neal — Midland, TX John von Netzer — Oklahoma City, OK Jim P. Miller — Lafayette, LA M. Davis Payne — Midland, TX William G. Watson — Midland, TX Wayne D. Miller — Midland, TX Gary W. Palmer — San Antonio, TX W. David Willig — Houston, TX Craig E. Moore — Houston, TX Matthew J. Parsley — Midland, TX John C. Worley — Rockport, TX Michael S. Morris — Azle, TX H. W. Peace II — Oklahoma City, OK William D. Neville — The Woodlands, TX  Scout – $50 Walter I. Phillips — Wichita, KS William L. Scott — Lafayette, LA Richard C. Blackwell — Midland, TX Edward B. Picou, Jr. — New Orleans, LA John M. Sharp, Jr. — Austin, TX E. Bernard Brauer — Corpus Christi, TX John W. Raine III — Lafayette, LA Robert L. Smith — San Antonio, TX William L. Craig — Lafayette, LA E. Gordon Reigle — Midland, TX Roy C. Walther — New Orleans, LA Robert D. Dougherty — Great Bend, KS Steven R. Russell — Amarillo, TX Gary M. Weir — Houston, TX Toby Elster — Wichita, KS Wayland C. Savre — Houston, TX Bonnie R. Weise — San Antonio, TX Bruce W. Fields — Corpus Christi, TX Charles D. Schmidt — Valley Center, KS Richard Wilkerson — Houston, TX Paul D. Friemel — Boerne, TX 

AUGUST 2010______7 Chapter News

DENVER No regular meeting was held in April, but on May 27, the Denver Chapter of SIPES met at Wynkoop Brewery in downtown Denver to hear a presentation by geologist Mike Pollok, #2512, from the Oklahoma City Chapter. The title of his talk was, "How to Find Buried Treasure in your Own Backyard." The treasures that Mike spoke to the group about are located on the NE shelf of the Anadarko Basin which is a gently sloping south-southwest dipping monocline. One striking feature in the area is the Pratt Anticline which plunges south into Oklahoma from the Central Kansas Uplift. As the seas withdrew from the area, Mississippi- an-age rocks were exposed to weath- ering and were truncated on the southwest and south flank of the anti- cline. The paleo ridge of the Pratt Convention attendees enjoying cocktails and hors o’deuvres at the icebreaker in Colorado Anticline caused different Mississip- Springs. pian-age zones to erode basin-ward, wrapping around the structure to Line play kicked off with wells target- form stratigraphic traps. ing oil and gas. Drill stem tests were often run and if high flow did not result, many of these wells were plugged and abandoned. The latest play is based on the recognition of down-dip wells that calculate "wet" which are actually oil prone. Large water fracture treatments on these wells enhance productivity with ini- tial water production that dries up over time. The talk and insights pre- sented by Mike were appreciated by Harrison Schmitt (left) and Dave Read at the all attendees. book signing for Return to the Moon during The Denver Chapter also co-hosted the SIPES Annual Meeting in June. the SIPES 47th Annual Meeting from June 21-24 at the Cheyenne Mountain speakers who took the time and effort Resort in Colorado Springs. Over the SIPES Oklahoma City Chapter Member to prepare, travel and present the fine Mike Pollok spoke at the May luncheon last year, Mike Austin and Bill Goff did talks heard at the technical sessions. meeting. a wonderful job organizing the other The Denver Chapter also thanks convention team members: George Diane Finstrom, the SIPES Board of The Warsaw Dolomite Gas play Carlstrom, Art Pansze, Gary Huber, Directors and SIPES Foundation for evolved into a detrital-Osage gas play Dave Read, Jim Rogers, Steve their assistance and support in plan- which later gave way to a Warsaw/- Sonnenberg, John Rakowski, Dave ning this year's convention. cap-rock oil play. After the 1950s struc- Kunovic, Erin Capra, Jane Wright, Bob David Read tural Yellowstone Field discovery in Cluff, Sue Cluff and Tom Stander. The Secretary T29n-R17w, the Mississippian State planners are also indebted to all those 

8 ______SIPES QUARTERLY Chapter News Continued CORPUS CHRISTI SAN ANTONIO research projects. Mr. Hoyt has more than 28 years experience and joined Thanks to the efforts of Dan During April of each year, the San the authority in 1999. Mr. Hoyt has a Neuberger, the Corpus Christi SIPES Antonio SIPES Chapter receives an B.S. in geology and post graduate Program Chairman, a diverse and updated oil and gas activity report studies in hydrogeology from the interesting array of guest speakers from Scott Pollard. Scott is an inde- University of Texas at San Antonio. was provided for the second quarter pendent geologist and oil scout and Thank you Mr. Hoyt for the interest- of 2010. Topics discussed included provides activity reports and other ing and informative presentation. global climate change, a review of oil petroleum industry data to his clients. The San Antonio Chapter did not industry history and current direc- Naturally, one of the big items was the conduct a June luncheon meeting but tion, and the development of the ongoing current activity in the Eagle instead held the annual get together Eagle Ford shale play. The average Ford trend in South Texas. Mr. Pollard on Saturday, May 29 at the new home attendance was 37 members. A received a B.B.A. in petroleum land of Charlie and Carol Kosarek. The notable joint meeting of the SIPES management in 1979, and a B.S. in social gathering took place on the Chapter, with the Corpus Christi geology in 1981, both from the banks of the Cibolo River along the Geological and Geophysical Societies University of Oklahoma. back yard of the Kosarek residence in was held in May and had 140 atten- In May, John Hoyt, P.G., geologist Boerne, Texas. There was plenty of dees. and hydrologist with the Edwards great food, appetizers, refreshments, In April, Bill Maxwell, chairman of Underground Aquifer Authority, pre- and great comradeship amongst the the board of Suemaur Exploration sented the most recent developments approximately thirty people attend- and Production, LLC, discussed in the Edwards Aquifer. San Antonio ing. points of controversy regarding glob- receives its water supply from the San Antonio will be the host city for al climate change and the question- Edwards Aquifer and therefore, as res- the annual GCAGS Convention, able impact of anthropogenic activi- idents of San Antonio, SIPES members Weathering the Cycles, this coming ties in comparison to solar activity are always interested in the geology, October. The meeting announcement fluctuations through time. hydrogeology, and recent research, is available on the website Considerable historic meteorological findings, and developments affecting gcags2010.com. We wish to thank local data was presented. the Aquifer. SIPES members Bonnie Weise, Tom Clayton Williams, a well-known Mr. Hoyt serves as the assistant gen- Ewing, and Stew Chuber for their con- and notable oil man from Midland, eral manager for aquifer management. tributions, efforts, and time towards Texas, provided his views regarding He manages regulatory and non-reg- aiding this event. the current turmoil in the U.S. oil and ulatory programs related to Edwards J. L. Jones gas industry. He focused on the direc- Aquifer water quality protection, Chairman tion of industry investments and the hydrologic data collection, and  questionable economics of shale gas plays in general. The joint meeting in May as noted above, was very well attended, and Mr. Williams’ humor was well- received by the audience. Gregg Robertson of First Rock, Inc. discussed the development of the Eagle Ford play in South Texas at the June meeting. He described his per- sonal approach and philosophy regarding exploration, and described facets of his successful relationship with PetroHawk regarding some of the Eagle Ford fields established to date. The Corpus Christi SIPES Chapter anticipates an equally interesting series of meetings during the second half of 2010, and will be pleased to welcome guests from other chapters. Eldon West San Antonio members including Don and Roxana McGregor (front) enjoying themselves Secretary at the Kosarek residence on the banks of the Cibolo River in Boerne at the annual May  get together.

AUGUST 2010______9 Chapter News Continued AUSTIN fluctuations, influenced the lithology The Austin Chapter’s regular lunch and facies of the shale, and an under- meeting is held the first Thursday of standing of the shale lithology is the month at the County Line on the important for exploration of the Please send in your Hill Restaurant. Our April and May Haynesville. speakers provided talks on shale Our May speaker was Charles SIPES Membership plays, and we had some of the best Cusack with PetroHawk Energy Corp. attendances to date, more than 50 Charles was part of the team that Directory changes people at each meeting. brought in PetroHawk’s first well in At our April meeting, Ursula the Eagle Ford Shale. The title of his or corrections by Hammes, Ph.D. with the Bureau of talk was “Eagle Ford and Haynesville Economic Geology at the University Shales – Two World Class Exploration September 15, 2010. of Texas, gave a talk entitled Opportunities.” “Influence of Facies Variations on The Austin chapter adjourns from You can also send in Exploration in Gas-Shale Plays (A June through September. Geologic Evaluation of the Ward Davenport your current photo Haynesville Shale).” In her talk, Chairman Ursula pointed out that the basin con-  to [email protected]. figuration, combined with sea-level

LAFAYETTE Our April guest speaker was William Kazmann, #1117, of Dallas, Texas, and his talk “Global Warming – Science, Religion, Money and Politics” was enjoyed by everyone. Included in the presentation was an analysis of the scientific “consensus” on the man- caused global warming movement. This subject will continue to be con- troversial for some time to come. Mr. Kazmann is a fellow SIPES member in Dallas having served as chairman and subsequently as a national officer and director. Every year in May, the SIPES Lafayette Chapter Members at the steak and shrimp dinner in May. Lafayette Chapter puts on a Sporting

Clays Shoot event, as well as a steak and shrimp dinner that evening. These events are held for both active members, as well as guests who are potential members. The hard work from John Duplantis, Johnny Walker, David Bieber, Ellis Guilbeau, John Harris and Steve Sinitiere make these outings fun for all. We are hoping to sign up a few new members by the beginning of the fall session. Special thanks to D. J. Bergeron for the great camera work at the bar-b-que. Danny Frederick Chairman Chapter Members at dinner following our Sporting Clays Shoot event. 

10 ______SIPES QUARTERLY Chapter News Continued OKLAHOMA CITY The main events for the Oklahoma SIPES LOGO GIFTS City Chapter of SIPES during the SIPES LOGO GIFTS quarter were noon luncheons in April, No. Price and a Steak Fry in May. Vic and Dorothy Cooper have been preparing  SIPES Brass Bookmark $5.00 ______a new membership directory for the  Enamel Lapel Pin $6.00 ______Oklahoma City Chapter. Unlike previ- ous directories, this one will be a pic-  Brass Key Ring $15.00 ______torial directory. The final product  Glass Paperweight $18.00 ______should be available some time in the  Limestone Paperweight $18.00 ______very near future. We wish to  Acrylic Paperweight $18.00 ______announce and welcome three new members. They are James L. Franks,  Hadrian Coral Paperweight $18.00 ______James P. Barnhart, and Stanley L.  SIPES Silver Key Ring $15.00 ______Cunningham. Our luncheon speaker in April was Name: ______Robert F. Ehinger. Bob earned his B.S. in chemistry and geology and was Address: ______granted an M.S. in geology, both from the University of Alabama. He was City, State & Zip:______granted a Ph.D. in geology from the Payment Method: ____ Check ____ American Express ____ Discover University of Montana. He is current- ly a consulting geologist in Oklahoma ____ MasterCard ____ VISA City. His former employers were Canadian Pacific, Cotton Petroleum, Account No.: ______and a number of independent oil companies for which he worked on Card Expiration Date: ______several projects. Signature: ______Bob’s subject was “Possible Origins for High Nitrogen Gas Wells in Return your Order Form to SIPES: Oklahoma.” High-nitrogen gas wells (>10 mole % N2) occur sporadically 4925 Greenville Avenue, Suite 1106, Dallas, TX 75206 throughout the Mid-Continent and Telephone: 214-363-1780 Fax: 214-363-8195 or e-mail: [email protected] are a bane to exploration. In many cases, the high nitrogen content ren- ders such wells non-commercial. Nitrogen values can range from 15- weather for the outside event this 70+ mole percent. These isolated, year. The meeting was well-attended high-nitrogen wells occur at shallower and all had a great time. As usual, depths (<6000’) and may be associat- Dorothy Cooper and her friend, ed with red beds, structurally positive Marlene Wilkinson, provided dozens areas (arches), and/or deep, through- of desserts for the occasion. going fault systems. This talk explored Our Chapter is inactive in June several possible origins for these while on summer break. We all look wells. forward to the fall session which In April, we also announced that begins in September with a new slate long time, very active member, Vic of chapter officers. I wish to thank the Cooper, #2171, would receive the Oklahoma City Chapter SIPES mem- SIPES Outstanding Service Award at bers for having allowed me to have the SIPES 2010 National Convention. been their chairman for the last year. We wish to congratulate Vic and also We anticipate our fall meetings to be his very helpful wife, Dorothy, for held in the downtown Oklahoma City many years of service to the Petroleum Club on the 35th floor of Oklahoma City Chapter and the the Chase Bank Building. Happy Outstanding Service Award winner Victor National Organization of SIPES. prospecting! Cooper at the Awards Banquet during the Our Annual Steak Fry was held in James Jackson SIPES Convention in Colorado Springs. May at the Elks’s Club in Oklahoma Chairman City. We were blessed with great 

AUGUST 2010 ______11 Chapter News Continued FORT WORTH possibly can and thump what’s left. This April meeting of the Fort Worth On occasion, geophones would get SIPES Chapter held at the Fort Worth moved (and, at a wealthy neighbor- Petroleum Club was the last of a long- hood corner, repeatedly stolen... term venue. Renovations and changes Wayne experienced no thefts of any at the Fort Worth Petroleum Club kind in poorer neighborhoods). require that our SIPES meetings be Streets were blocked in one area by held elsewhere. residents’ careful parking away from Our speaker, Wayne Hoskins, the curb on both sides, staggered such #2661, was introduced by Terri that sourcing trucks could not pass Mayfield-Cowan, vice chairman. through. Neighborhood associations Wayne’s presentation was made at the were the most time-efficient negotia- 2009 SIPES Convention in Hilton tions. City permitting, costs and poli- Head, South Carolina, and is available cies varied widely. A curious regula- on DVD from the SIPES Foundation tion in some places edicts that a prop- film library. He has also been invited, erty must be leased before it can be Guest speaker Teresa Moss (left) with Vice and delivered this presentation to sev- surveyed seismically. Costs for these kinds of shoots vary from $160-250K Chair Terri Mayfield-Cowan at the May eral town groups in the Barnett Shale meeting. area so that they can gain an under- per square mile. standing of seismic program planning Our May 20 meeting was at the from the gallery, one of the world’s and execution. The title of his talk is Norris Conference Center, 304 finest collections, to the meeting. The entitled “Challenges of Urban Houston Street, housed in what was audience was allowed to handle and Seismic.” He shared his experience the original AMC Theater location in ask questions about these specimens. with many seismic shoots in the Fort downtown Fort Worth. Lunch will be The Oscar E. Monnig Meteorite Worth metroplex. His core message is $25 now, which is in line with other Collection was donated to Texas the need to plan, plan, plan…and places where our setup and speaker Christian University (TCU) over a then expect to plan/modify some needs can be accommodated. Plenty period of eight years, from 1978 to more at the point when all the shoots’ of free parking surrounds the Norris 1986. Prior to its transfer, the entire resources are in place. A big aid to Convention Center and a map was collection was cataloged by Glenn such planning is recent satellite data: provided to the attendees for future Huss of the American Meteorite geometrically true and up-to-date, reference. Our new meeting place and Laboratory in Denver, Colorado. The they help identify hazards to the its arrangements will require a more collection now contains over 1,600 dif- shoot. An urban setting involves accurate headcount and RSVP stan- ferent meteorites. When Oscar many different obstacles and land dards for budgeting costs. Monnig died in 1999, a considerable uses. A retired landfill is receiver-only Vice Chairman Terri Mayfield- amount of money was given to the while an active landfill is source-only. Cowan introduced the speaker, Teresa Geology Department at TCU from his And, a parade of trash trucks—that’s Moss. Ms. Moss is the director of the estate with the purpose of maintain- one every 20 seconds—made a noisy Oscar E. Monnig Meteorite Gallery at ing the collection. On Saturday, environment and one that thumper- Texas Christian University. Teresa February 1, 2003, the Oscar Monnig truck sourcing could not overcome. Moss has a M.Ed. and an M.S. in envi- Meteorite Gallery was opened for the Plan to “vibro-seis” everywhere you ronmental science; she is an adjunct public. With about 10% of the best faculty member for TCU’s Institute for meteorites in the collection on display, Environmental Studies, and has this is a world-class facility. The served as a NASA/Jet Propulsion gallery is located in the Sid Laboratory Solar System Ambassador. Richardson Science Building on the The title of her presentation was campus of TCU in Fort Worth. “Gems from Space.” Fort Worth SIPES Information on the Monnig Meteorite was pleased to bring this unique pre- Gallery can be easily found online. sentation to its membership and their Our chapter did not hold a June guests. Regardless of discipline, this meeting, but several chapter members subject of meteorites and their effect did attend the SIPES Convention in on earth science was very interesting. Colorado Springs. Our next meeting Along with a “virtual tour” of the will be held on September 23. Monnig Meteorite Gallery at TCU and Russ Hensley the various types of meteorites, Ms. Chairman April speaker Wayne Hoskins at Moss brought a selection of meteorites  the Fort Worth Petroleum Club.

12 ______SIPES QUARTERLY Chapter News Continued NEW ORLEANS how large a discovery can reasonably Orleans. Dr. Campenella gave an At its April 2010 luncheon meeting, be, but how small it can be as well. enjoyable and very vivid description the New Orleans Chapter welcomed While everyone drills prospects for of the way things were along the New local geologist, Paul Lawless, who high side reserves, the high side Orleans Mississippi River front area gave an enlightening presentation on reserve potential is rarely found. The during the life and times of Abraham risk analysis for exploration prospects. Pmn resource value taken from a log- Lincoln. In 1828 and 1831, Lincoln, a Paul received his B.S. (1986) and M.S. normal resource distribution is then poor rural youth from Illinois arrived (1989) from Louisiana State University used to run economics for portfolio via flatboat to the bustling wharves of and has been employed as a petrole- analysis so that discovery size pre- then America’s third largest city, and um geologist in the New Orleans area dictability is closer to reality. greatest city of the South. Lincoln’s since 1990. He currently works for The New Orleans Chapter conclud- experiences in the New Orleans area Helis Oil & Gas Company, L.L.C. His ed the 2009-2010 year with its annual ultimately influenced him for the talk entitled “Geologic Input and May dinner held at Andrea’s remainder of his life. Dr. Campenella Economic Modeling of Prospects” Restaurant in Metairie. Spouses and described the city and port of New addressed how the investment side of guests accompanied the members Orleans into which Lincoln landed in the oil and gas industry has driven the who all enjoyed a talk given by local the early 19th century and how it set characterization of a prospect’s author and Tulane University geogra- the stage for what the future presi- reserve (or resource) potential from a pher, Richard Campenella, PhD. Our dent of the United States experienced deterministic approach of describing a guest speaker researches, maps and here. The evening’s topic will soon be prospect’s high side potential to writes about the historical and pre- published in Dr. Campenella next describing a prospect’s potential as a sent-day geography of New Orleans. book, Lincoln in New Orleans. series of outcomes based upon a log- He has written five critically Al Baker normal distribution. This investment acclaimed books including Bienville’s Secretary approach concerns itself not only with Dilemma and Geographies of New 

SIPES Chapter Meeting Information

AUSTIN DENVER MIDLAND Chairman: Ward Davenport Chairman: Jim Applegate Chairman: Don Eckerty Secretary: TBA V-Chrmn: Travis Brown V-Chrmn: Tom Wilson Treasurer: Dwight Cassell Secretary: Dave Read Secretary: Robert Wynne Meets: The County Line Treasurer: Tom Stander Treasurer: John Kullman (On the Hill) Meets: Wynkoop Brewing Co. Meets: Midland Country Club 1st Thursday 4th Thursday 3rd Wednesday

CORPUS CHRISTI FORT WORTH NEW ORLEANS Chairman: Stephen Thomas Chairman: Russ Hensley Chairman: Louis Lemarie’ V-Chrmn: Dan Neuberger V-Chrmn: Terri Mayfield-Cowan V-Chrmn: Mike Fein Secretary: Eldon West Secretary: TBA Secretary: Al Baker Treasurer: David Desenberg Treasurer: TBA Treasurer: Reese Pinney Meets: Town Club Meets: Norris Conference Center Meets: Andrea’s Restaurant Last Tuesday of month Variable dates 3rd Tuesday

DALLA S HOUSTON OKLAHOMA CITY Chairman: Doug Essler Chairman: Steve Hartzell Chairman: Harold Hanke V-Chrmn: Don Muth V-Chrmn: Mike Jones V-Chrmn: Jim Franks Secretary: Carol Shiels Secretary: Paul Babcock Secretary: Mike Pollok Treasurer: David Scull Treasurer: Scott Daniel Treasurer: Victor Cooper Meets: Dallas Petroleum Club Meets: Petroleum Club Meets: The Petroleum Club 3rd Tuesday 3rd Thursday Bank One Bldg., 35th Floor 1st Wednesday L AFAYETTE SAN ANTONIO Chairman: Danny Frederick V-Chrmn: Travis Helms Chairman: J. L. Jones Secretary/ V-Chrmn: TBA Treasurer: Steve Sinitiere Secretary/ Meets: Petroleum Club Treasurer: Joe Finger 2nd Wednesday Meets: Petroleum Club 3rd Thursday

AUGUST 2010 ______13 Chapter News Continued DALLAS out his talk, John’s passion for geology April’s luncheon speaker was John was contagious! Breyer, professor at the TCU Energy In May, the Dallas Chapter brought Institute. Dr. Breyer spoke on back the Mexican Fiesta Evening. Members and their guests enjoyed a “Geology in a Technology Play: The IN MEMORIAM Barnett Shale.” John reminded the Mexican buffet with margaritas, beer IN MEMORIAM audience that horizontal drilling tech- and wine beautifully presented at the nology, slick-water fracs, and engi- Dallas Petroleum Club on Mother’s Day weekend. Chapter board member We regret to note neering technology aside, geology is the passing of still at the heart of good Barnett Shale Neil Barman planned the evening. development. The fact that a shale Later in May, many of the Dallas the following member: acts as a source, reservoir and seal SIPES members attended the Southwest Section AAPG Convention underscores the need to understand Wilford J. Wells, #2629 the stratigraphy and paleodeposition- just north of Dallas, in Frisco. Talks al setting. In the central and southern included the East Texas Basin, of San Antonio, Texas portions of the Fort Worth Basin, the Delaware Basin, Fort Worth/Central who died on Barnett becomes less calcareous. What Basin and Gas Shales Geology & November 4, 2009 Technologies. appears to be a claystone facies can  actually be a predominantly sponge Our June luncheon meeting includ- spicule matrix with as much as 60% ed a thought-provoking talk by board quartz. This cryptocrystalline quartz member Don Muth, #3083, entitled responds well to a frac, making it a “Gulf Coast Lower Wilcox; More to potential “sweet spot.” Understand- Find from the Micro to Macro.” Don ing the various facies within the began his career in New Orleans and Barnett enables the geologist to opti- moved to Dallas with his family in the mize drilling locations. The highly wake of Hurricane Katrina. Don’s South Marsh Island and elsewhere. restricted anoxic conditions of por- company is Oakmont Minerals, Inc. Don presented a comprehensive tions of the Lower Barnett combined The Lower Wilcox has been revital- overview of the Wilcox from the with detrital quartz could prove to be ized with recent deep Paleocene dis- updip, onshore predominately oil an economic combination. Through- coveries in the Alaminos Canyon and production where chlorides are low, down the section through the largely microbial gas production as chlorides increase and ultimately below the geo-pressure contact where organic acid from hypo-saline waters could explain perm and porosity and great depths. Ultimately, Don proposed geochemical processes to explain sub- salt discoveries in the deep gulf. His hydrological system is a good model for the burial/hydrocarbon generation process and explanation of deep reser- voirs in the Lower Wilcox of the Paleocene. The Dallas Chapter is saddened to report the passing of long time Chapter Affiliate Sam Allen in April of this year. Sam was a much-loved land- man who many of us had the privi- lege to have worked with. Carol Shiels Secretary  Two of our luncheon speakers, Vice Chairman Don Muth, #3083, (left) and John Breyer.

14 ______SIPES QUARTERLY Chapter News Continued HOUSTON meeting. She explained that to under- scientific information to lawmakers. In April, Wayne Penello, with Risked stand the finer details and nature of AAPG has a full-time office in Revenue Energy Associates (R^2), shale reservoirs, one must understand Washington staffed by David Curtiss. presented his topic “Hedging for the entire basin as well as the actual This is not a lobbying organization, Small Independents: A Quantified shale rock itself. She shared the work but one whose purpose is to inform Approach” to an audience of 73. He of the University of Texas Bureau of policy makers with knowledge of our set the stage by comparing the explo- Economic Geology (coauthors - Scott science. As president, Dave will join ration and production business to the Hamlin and Ray Eastwood) to better AAPG members in making two con- toughest manufacturing businesses: understand the Haynesville and gressional visits a year. Additional Producers do not know how much Bossier Shale reservoirs. Dr. Hammes information on these presentations is they will produce or what price they related that a thorough understand- available on the chapter’s website - will get for their production. Hedging ing of the paleo-geography and struc- www.sipeshouston.org. offers producers the tools to manage tural setting (directly impacts deposi- On May 14, the SIPES Houston the price received for their produc- tion), when underpinned with an Chapter presented a full day seminar tion. There are many types of hedging analysis of sequence stratigraphy “How to Become an Independent” products and vendors that offer the (controls facies), that one can under- covering every possible aspect of promise to lock in a specific price, or at stand the nature of a shale reservoir being an independent. Themes least a guaranteed minimum price (or and its extent. When one brings into included formulating a business plan, floor). the assessment, the geochemical and choosing an entity, and raising money A very common financial structure petrophysical analysis, a more thor- both to fund the company and/or used when hedging is often referred ough understanding of favorable con- individual projects. The program was to as a “costless” transaction, because ditions for shale gas production can be organized by Phil Martin, #2390, and the producer has no upfront, out-of- attained. Larry Rairden, #2924. A special pocket expense. Typically, the cost of Dave Rensink, president-elect of “thank you” goes to Halliburton and hedging ranges from 0.5 to 2 percent AAPG, was the guest speaker at the their generous support of SIPES of the notional value of the transac- June luncheon. He recently retired through use of their Oak Park tion. Once hedges are in place, they from Apache and is approaching the Auditorium facilities. are like a knife that cuts both ways. If next year as AAPG President as a full- Thanks to the following speakers: time job. He showed a graph detailing prices move lower, the payout “How to Become a Successful Inde- the membership categories in AAPG. received will help to stabilize the pro- pendent in 3 Simple Steps,” Mark Students make up the largest segment ducer’s cash flow. However, if prices Gregg, #2883 of AAPG, followed by consultants/- move higher, the producer will not “Building a Business Plan and independents and small independent benefit. Accessing Capital: Foreign and companies. Rolled together, the inde- Faced with these challenges, pro- Domestic,” Robert Pledger, #829 pendents are the largest membership ducers need to fully understand hedg- “Land and Legal Issues for the faction in AAPG. Dave stressed that ing. If you want to leverage your asset Independent: from Contracts to AAPG is a scientific organization holdings to increase your returns, you Entities,” Ron Moore whose primary role is to disseminate should have an informed analysis and “Geoscience Data Resources: timely technical information to its opinion on the following: Available and Free,” Steve Hartzell, membership. #2439 Great strides are being made in • How much risk do I have? “Online Resources: Land and making archived information easily • How much risk can I tolerate? Legal,” Allan Morgan available online. All AAPG publica- • How large a hedge position do I “So You Want to Be an Independent: tions are now available through have the credit capacity to support? Welcome to the Sales Department,” Datapages and Search and Discovery. • Are the hedging opportunities suf- Jory Pacht, #3054 Much of it is free to AAPG members, ficiently attractive? “Packaging Prospects for the or available for a nominal cost. One Marketplace,” Scott Laurent, #1175 data source that is coming into its own Ursula Hammes presented her “Hardware and Software for is U-Drill, a geographical interface “Facies Characteristics, Depositional Consultants,” Deborah Sacrey, #1271 that allows you to define an area on a Environment, and Petrophysical “The Political Landscape Facing map and link to all the published Characteristics of the Haynesville and Independents,” Dan Smith, #1647 materials in that area. Bossier Shale-Gas Plays of East Texas Paul Babcock and Northwest Louisiana,” to a sold- He also discussed Geo-DC and its Secretary out crowd of 119 at our May luncheon role in disseminating sound, timely, 

AUGUST 2010 ______15 President’s Column Continued exploits and a possible future power source that exists from material on the lunar surface. The technical, field trip, and other committees seem to have done it right at this event. I cannot mention an annual meeting without giving credit to Diane Finstrom and the staff in the national office (Katie and Ann) for making arrangements, coordinating schedules, and solving all the last minute problems that are a part of these events. A special thanks to the guy who ordered a whole week of chamber of commerce days for us to enjoy. Keep your calendars clear for June 20-23, 2011 for next year's Annual Meeting and Convention in Jackson Hole, Wyoming. The Houston Chapter and Diane Finstrom will most assuredly have a great set of talks and entertainment in this setting with spectacular mountain vistas just south of Yellowstone National Park. I might even be able to talk my wife into hik- ing the four miles up to my thesis area dealing with oil gushing unto the Gulf ty of those who work on the rigs. in north Yellowstone. Then again, I below a water depth of 5,000 feet. The During this same speech he addressed remember her saying something oil is threatening sensitive marsh the need to move to renewable clean about needing a horse and rope to get areas that are critical spawning areas energy sources. The DOI is assem- her up that trail the next time. for many species of fish, crabs, and bling another commission, this time As a Louisiana resident, I have a ring oysters that live in the Gulf. Attempts without dissenting engineering side seat to witness the two man- to place a dome over the leaking oil experts, to make recommendations for made disasters unfolding in the Gulf failed due to icing, and a cap is cur- the safe operation of deep water of Mexico. Both the BP blowout in rently catching between 30 to 60 per- drilling. The National Commission Mississippi Canyon Block 252 on April cent of what is estimated to be on the BP Deepwater Horizon Oil 20, 2010, which may end up the great- between 30 to 60 thousand barrels per Spill and Offshore Drilling is com- est environmental disaster in the U.S., day. The two relief wells are not posed of Senator Bob Graham and the deep water drilling moratori- expected to be in a position to kill the (Democrat, former Senator of Florida), um issued by Secretary Salazar on flow until mid-August, which leaves William Reilly (Republican, former May 30, 2010, which may be the worst more oil to be dumped into the Gulf. EPA director that worked on the after- economic disaster in the U.S., are The truly regrettable disaster is the math of the Exxon Valdez oil spill), man-made events. effect of the drilling moratoriums Frances Beinecke (president of the The BP blowout appears to be relat- issued by the Obama Administration Natural Resources Defense Council, ed to a series of decisions on board the on May 27, 2010 and July 12, 2010. Degree in Forestry and Environmen- Deepwater Horizon drill ship by BP These moratoriums call for the sus- tal Studies), Don Boesch (president of personnel. Their decisions relating to pension of drilling of 33 active deep the University of Maryland Center for not fully circulating out the mud sys- water rigs, and the halt to future Environmental Science, a biological tem before cementing, using fewer drilling on the north slope of Alaska. oceanographer), Terry Garcia than recommended centralizers, Eight members of the oversight panel (Executive Vice President for Mission switching out mud in the riser before of fifteen engineering experts who Programs for the National Geographic setting a second plug, not fully evalu- reviewed a Department of the Interior Society, law degree from George ating the blowout preventer, and (DOI) report on what needs to be Washington University), Cherry other operational actions seem to done to improve the safety of deep Murray (the Dean of the Harvard have cumulatively contributed to the water drilling, were not in favor of School of Engineering and Applied uncontrolled flow to the surface, and any moratorium. The president told Sciences, Ph.D. in Physics the loss of eleven lives. Now they are the nation that it is to ensure the safe- (Continued)

16 ______SIPES QUARTERLY President’s Column Continued from MIT), and Fran Ulmer cates these deepwater rigs represent significantly ups the economic impact (Chancellor of the University of 85,000 to 130,000 jobs to the economy of the DOI's indecisiveness on the Alaska Anchorage, law degree from of the Gulf Coast. Assuming these jobs issues regarding drilling. Wisconsin). A commission made up of average $40,000 per year, we are look- I hope by the time of this publication a politician, a regulator, an oceanogra- ing at an impact of between $283 and BP will have killed their well, and the pher, two lawyers, a physicist, and an $433 million monthly. BP, after a meet- administration, so dedicated to "green environmentalist. I see this group a lit- ing with President Obama, set up a jobs," will have been shown the error tle light on common industry knowl- $20 billion oil compensation fund that in their ways regarding this moratori- edge but I guess that is why they are is to be administered by Ken Feinberg. um. Enabling regulators to impose asking for $12- $15 million for research This fund is to handle the claims due more safety guidelines but allowing funding. Mr. Reilly, a co-chairman of to loss caused by the blowout. Yet, Mr. the operators who have safely drilled the commission, told the New York Feinberg says that workers who have over 48,000 wells on the shelf to con- Times that the commission would hold losses due to the moratorium must be tinue to explore in a responsible man- its first hearings on July12th and 13th compensated from another $100 mil- ner with more oversight from the gov- and likely not have a final report until lion fund set up by BP. The White ernment. I see this like all the TSA per- the end of the year. Then by the time House said that workers would not be sonnel who work at the airports to legislation is drafted and approved it precluded from presenting a claim to ensure your safety. They really do not will be late in 2012 at the earliest for Feinberg and the fund he administers. accomplish anything but they owe the moratorium to be lifted. To which Feinberg responded "they their jobs to government bureaucracy, This action is hitting Louisiana like a are not precluded from filing isn't the because the government as our presi- tsunami. Infrastructure and jobs that same thing as promising to pay the dent says "has to do something." I now have taken 50 years to put in place are claim." The $100 million would not know that not all change is progress. I being held ransom for political games- even cover half of the first month in am hoping this is not a broadside into manship. Each of these drill ships has loss wages to these people. BP is tak- the independents that are the corner- a crew of between 60 to 80 men on ing the position they are responsible stone of exploration in the oil and gas towers so they employ about 160 peo- for the results of the blowout not the industry. ple. It takes about five people onshore moratorium. The permits for the shal- Keep working to keep the lights on. (cooks, steel fabricators, mud suppli- low water shelf activity are now being For more information on the panel ers, logging crews, etc.) to support reviewed. This has placed a number of of the National Commission on the oil each crew member on the ship. When projects in a position of whether they spill see the following URL: these people go home, their money will be permitted when the rigs are http://www.seas.harvard.edu/news- turns over four to five times in their ready to move on them. The shelf has events/press-releases/cam_commis- respective communities. This indi- about 50 rigs currently active which sion 

2010 SIPES Foundation No Hassle Raffle Winners

1st Prize — $500 3rd Prize — $100

Molly Eyler Michael N. Fein Midland, TX Metairie, LA Steve H. Hill 2nd Prize — $250 Houston, TX Donald C. Gifford James W. Caylor Dallas, TX Oklahoma City, OK Vinton H. Sholl Larry L. Jones Houston, TX Houston, TX

AUGUST 2010 ______17 SIPES Directory Corrections and Changes E. Bernard Brauer Thomas M. Kirby Jory A. Pacht P.O. Box 270295 PSC 901 Box 11 18 Pembroke St. Corpus Christi, TX 78427-0295 FPO, AE 09805-0001 Sugar Land, TX 77479 Cell Phone: 626-404-4144 Alvin A. Kollaja Bus./Cell Phone: 832-338-5928 Gene A. Carter 218 Helen Greathouse Cir. Fax Phone: 281-265-9356 4914 Wooldridge Rd. Midland, TX 79707 [email protected] Corpus Christi, TX 78413-2731 Pete MacKenzie John D. Sistrunk, Jr. Rebecca L. Dodge P.O. Box 166 200 Village Garden Dr. 1546 Hanover Rd. 137 E. Dublin Granville Rd. Madison, MS 39110 Wichita Falls, TX 76302 Suite E James P. Talbot Steve H. Hill Worthington, OH 43085 P.O. Box 1241 419 Hollow Dr. Gunnison, CO 81230 Houston, TX 77024 

Geoscience Salaries Increase by 3.1% between 2008 and 2009 Despite the U.S. economy’s downturn, geoscience salaries increased by 3.1 percent between 2008 and 2009, which is slightly more than the salary growth for other science occupations (2.1%) and for all U.S. occupations (2.8%). In 2009, the top geoscience salaries were for management positions (Natural Science Managers: $127,000, Engineering Managers: $122,810), petroleum engineers ($119,960), and geoscientists (excluding hydrologists and geographers) ($92,710). Mean annual salaries for environmental scientists ($67,360) were $1,700 greater than national average for other science occupations.

Salary growth between 1999 and 2009 for environmental scientists, environmental engineers, hydrologists, and mining and geological engineers lagged the national average salary growth for other science occupations. However, mean annual salaries for the majority of geoscience occupations increased more than the national average for other science occupations between 2008 and 2009.

Natural Science Managers Engineering Managers Petroleum Engineers

Geoscientists Atmospheric and Space Scientists Mining and Geological Engineers Environmental Engineers Hydrologists Geographers Environmental Scientists Life, Physical, and Social Science Occupations

Source: AGI Geoscience Workforce Program, data derived from the U.S. Bureau of Labor Statistics, National Occupational Employment and Wage Estimates, 1999-2009.

18 ______SIPES QUARTERLY Positive Attitude and Responses Continued

National Energy Advisor to the President, (a.k.a. Energy  Another troubling presentation created by HBO is a Czar, the Assistant to the President for Energy and Climate slanted documentary called GASLAND (www.gaslandthe- Change) applies the skills of a former EPA head toward movie.com). GASLAND is filled with half truths, implica- "clean" energy coordinating across all the major depart- tions to lead to a false conclusion of fact, and simply a ments of the federal government and even the military. Michael Moore-type bias method to supposedly educate Ken Salazar, Secretary of the Interior, and Steven Chu, U.S. the public. The program uses the successful reality-TV Energy Secretary, form the rest of a very strong federal trio entertainment approach — "Hey we have identified the that threaten the U.S. oil and gas industry's very existence villains for you, now go after them!" Since HBO is in the and are negatively impacting its current operations and business of making money with its entertainment, one economic planning. Meanwhile, each of us cautiously wonders about the sources of funding for this documen- struggles for production from the remaining hydrocarbon tary, the timing of cabled broadcasts, and the real underly- reserves in mature fields and development of prospects ing purpose. Since GASLAND was on cable station HBO, that we hope are left. and not on a public broadcast, it's harder to get rebuttal air The stark truth is that alternative fuels are but a drop in time. the bucket, and solar/wind account for very meager per-  For over twenty years, the prospect of storm water centages of power even with dramatic future develop- runoff permitting has been repeatedly visited through reg- ment. That nasty, black, gooey stuff is still the prime ingre- ulatory, legislative and judicial decisions regarding the dient for making our multi-millions of vehicles move and construction of well sites and supporting equipment. On for a large part of the manufactured products we all use July 1, 2010, The Clean Water Act of 2005 has been every day. The main energy component of the U.S., and redressed to no longer exempt oil and gas E&P operations the world economy as we know it, is fossil fuel with oil and and construction from permitting. Representative Michael gas being at the forefront. Arcuri (D-NY) amended the Oil Spill Accountability and Now with the recent BP offshore disaster and the con- Environmental Protection Act of 2010 (H.R. 5629) revers- tinued "limelight" coverage by the media, the entire oil and ing the previous position of exempting the oil and gas E&P gas business seems to be saddled with a renewed, intensi- construction from obtaining a permit under the Clean fied type of blame. Before this incident, the main broad- Water Act. This amendment will have a tremendously neg- casted theme was and continues to be "Cap and Trade" ative impact on oil and gas interests across the United with the objective to wean this country off of fossil fuels States and particularly damaging to Texas. The reason is and move into a new world of "clean" energy derived from that Texas is one of the only states in the country in which alternative energy sources. In an Oval Office speech about storm water runoff permitting related to oil and gas activ- the Gulf oil well leak, President Obama described the ities is not handled by state regulatory agencies, but by the event as, "the most painful and powerful reminder yet that EPA. In other words, should this bill be enacted and the time to embrace a clean energy future is now." enforced, a federal permit would be needed prior to the The issues below further illustrate some of the many construction of every new well site in Texas. It has been evolving operational and political problems faced by the included that part of this process would entail certification oil and gas industry: of compliance with the Endangered Species Act. The  In the second week of July 2010, the EPA sponsored a storm water runoff permitting process for construction Fort Worth hearing on hydraulic fracturing in which more would allow for citizen lawsuits, criminal penalties and than 600 people attended. It was described as "raucous as potentially large daily fines being imposed for non-com- a Jerry Springer episode," with jeers from opponents to the pliance with the subjective requirements involved. hydraulic fracturing/horizontal drilling in the Barnett  With the government hungry for taxes, it seems that Shale and cheers from members of the industry peppering investment tax credits for drilling intangibles, the deple- the debate. I am not certain the EPA had good intentions tion allowance and even tax exemptions on stripper well to hold such a forum. As the TIPRO representative Rich operations are gone. Another type of tax expansion being Varela, senior VP, said to the audience, "The hearing creat- proposed is the Value Added Tax on all production and ed a division where you're either for or against hydraulic manufacturing functions. European governments have fracturing. Polarizing sides on this issue is not going to already been using VAT and it has NOT worked in those advance our country's energy needs. If work was more economies. Why would VAT work in our U.S. economy? cooperative between sides, residents could see that natur- As in Europe, gasoline could surpass $8 per gallon and al gas in the Barnett Shale is an economic positive for the beyond. area." It is clear that these serious opponents against the These specific areas of attack upon the oil and gas indus- oil and gas industry are well-organized and funded. Now try are stated to get your ire up, although it's hardly nec- more than ever, these people have a politically supportive essary these days. Seemingly, the liberal media, liberal atmosphere heretofore not seen. We all shudder if fractur- politicians and an unconscious, uneducated public are ing a well became impractical because of national regula- tions or insurmountable local restrictions. (Continued)

AUGUST 2010 ______19 Positive Attitude and Responses Continued reshaping the oil and gas industry (in fact all energy use) by In some form or other, each of us may have experienced the use of heavy regulation, permitting and taxation. It is a personal confrontation regarding our energy profession's as if we can't handle the energy problems that we have impact on the economy, climate change and the communi- overcome for more than ninety years, and now we are ty health of individuals, and for that matter the world. To impotent, needing all kinds of defined direction, regulato- be the recipient of such attacks wears on one's psyche ry supervision and "free? extra" help to accomplish our finally causing disgust and just plain anger. Emotions can E&P tasks. run very high. Personal Attitude and What It Can DO So what is today's energy professional to do to maintain a good work ethic and sanity within today's adverse pub- In my recent travels and interaction with colleagues lic and government regulatory/control energy scene? throughout our industry, I am encountering a "down-trod- First, all of us have to be more prepared by observing, den" attitude that I have not experienced before in my 42- gathering intelligence and continuing to studying the year career of oil and gas activities. A large part of the opposition to the oil and gas industry. Unless you have problem seems to be increased doubt, and the lack of con- been entombed in an isolation fortress, we are all now to fidence in believable definitions to our non-existent some degree practicing this habit. A more diligent and national energy policy. The reality is that the economy of concerned effort by the voting public hopefully will lead to the U.S. is in a sorry state with a congress and administra- common sense in replacing an out-of-control government. tion in constant turmoil thwarting any constructive In this quest, we must have a loud voice to at least match progress in a large number of critical commercial func- or surpass the opposition with solid energy facts. tions. The astronomically growing debt level even sug- Second, be it an individual, a specialized group or a gen- gests a monetary inflation event that could stymie any eral audience, a person's manner of presentation will future economic recovery. What happens to the develop- immediately affect how comments about energy and relat- ment of cheap and reliable energy sources being devel- ed operations are received. Know your audience as much oped and available is a master element to this country's as practical. When possible enable yourself by leading with livelihood and economic recovery. It is imperative that questions of your own so as to gauge a person's energy governmental infringements and the uninformed zeal to position. Do not dodge (I admit I have and probably you have create "clean" energy do not hamper logical utility and too) encounters to present a defense and perhaps go on the progress. Over time the truth is that all sources of energy offense about energy facts and operations. Know and sup- will be required to sustain humanity, but each segment of port those talented leaders who can carry our energy caus- the overall energy supply must make economic sense. es to center stage. In the past and present, it has been the American inde- Third, as in the past, all the industry organizations, API, pendent oil and gas people with that "wildcatter" spirit IPAA, TIPRO and some of the other professional organiza- that have carried the day to deliver oil and gas when skep- tions are currently working to get the government and the tics said there was none. It is a very human trait to want to general public to understand the how and the why of pos- be accepted, rewarded and even receive praise for the itively supporting our industry structure. Besides these work that we do. Not torn down. On the scale of public energy-related organizations, support for technically acceptability, I think individual oil and gas professionals sound and conservative energy policies can be found at still rank well above the common criminal although that the Heritage Foundation (membership @myheritage.org ). description as been lately applied to BP officers and that Another recommended organization to get summarized company. Surely on the measure of human acknowledg- unbiased candid material with respect to the government's ment of professions, we all still rank above the tax or bill effort to tax all forms of energy and personal support to collector. Maybe on most days the admiration of our pro- grasping governmental policy and action including energy fession surpasses those in the political arena, most of is the National Center for Policy Analysis. In September whom are lawyers. 2009, The Fort Worth Chapter had Dr. H. Sterling Burnett, Thank goodness in this country, we can still choose to a lead analyst for the National Center for Policy "E" Team have a personal attitude and freely express ourselves and in Dallas to speak on Cap and Trade. The website for this strive toward goals that are not defined by the state. In our non-profit organization can be found at www.ncpa.org. current U.S. society a lot of effort and treasure are spent to Besides the country-wide meetings and actions of the influence individual personal attitudes and finally forge it Tea Parties, there are new "membership-type" energy orga- to the leadership's purpose at hand. Historically, it is nizations appearing on the Internet and through direct understood by leaders that national pride and the ele- mailings. ments of individual attitude can propel a human endeav- One recent example is the book called, Why We Hate the or to great heights. A common positive human spirit has Oil Companies by John Hofmeister. Hofmeister was named proved time and again the drive to tremendous accom- president of Houston-based Shell Oil Co. in March 2005. plishments. Upon retirement from Shell Oil Company in 2008, John (Continued)

20 ______SIPES QUARTERLY Positive Attitude and Responses Continued

Hofmeister founded and heads the not-for-profit, nation-  Those who are fired with an enthusiastic idea and who wide membership association, Citizens for Affordable allow it to take hold and dominate their thoughts find that Energy. This Washington, D.C.-registered, public policy new worlds open for them. As long as enthusiasm holds education firm promotes sound U.S. energy security solu- out, so will new opportunities. tions for the nation, including a range of affordable energy  When life hands you a lemon, make lemonade. supplies, efficiency improvements, essential infrastruc-  Drop the idea that you are Atlas carrying the world on ture, and sustainable environmental policies. This book your shoulders. The world would go on even without you. and organization might have some merit. Don't take yourself so seriously. Fourth and finally, without seeming to be too  The trouble with most of us is that we would rather be "Pollyanna," the Norman Vincent Peale book entitled, The ruined by praise than saved by criticism. Power of Positive Thinking does have some application in  The tests of life are not meant to break you, but to our daily work and communicating with those around us, make you. friend or foe. A person that is optimistic and genuine is far more impressive to an audience than those that spout bit- A screaming dramatic appeal with verbal fireworks like ters into the ears of their listeners. Some of the more Patrick Henry is beyond my writing abilities. It is very clear famous positive generating quotations still ring true and fit that all energy professionals need to become more politi- today's situations as we pursue independent energy: cally active in whatever way they can. To meet the increas- ing challenges ahead, joining with established organiza-  A positive mental attitude is a belief that things are tions or selected groups will serve to amplify personal going to turn out well, and that you can overcome any impact and sustain our courage plus those with whom we kind of trouble or difficulty. join. You may have already heard the call and reacted. I  Believe it is possible to solve your problem. hope so. Tremendous things happen to the believer. So believe the Russ Hensley is an independent con- answer will come and it will. sulting petroleum engineer in  Watch your manner of speech if you wish to develop Rockwall, Texas and is serving as chair- a peaceful state of mind. Start each day by affirming peace- man of the SIPES Fort Worth Chapter. ful, contented and happy attitudes and your days will He primarily works in the Arkoma, Fort tend to be pleasant and successful. Worth and Permian Basins, and has  Never talk defeat. Use words like hope, belief, faith, been an independent since 1995. He can victory. be reached by email at ar_hensley@sbc- global.net. 

WELCOME NEW MEMBERS The following new members were approved by the SIPES Membership Committee from May 5 to July 21, 2010

AUGUST 2010 ______21 Technology Corner

Coordinate Systems, Datums, and Map Projections by Larry J. Rairden, #2924 — Houston, Texas

Our business is dependent on coor- these datums. In Texas, a point having dinate data, whether for locating “Currently, in the fields of a given latitude and longitude in wells, seismic data, land ownership, or NAD27 is displaced anywhere from 70 other cartographic applications. cartography and land-use, to 170 feet from a point having the Failure to consider the proper datum there are two horizontal identical latitude and longitude in can result in errors in location that NAD83 (Figure 1). datums in use in North may not be identified until significant PROJECTIONS problems arise. This article introduces America. These are the Projections convert spherical coordi- some of the basic concepts of datums nates (latitude-longitude) to planar for the oil and gas professional. North American Datum of coordinates so that they can be dis- DATUMS AND ELLIPSOIDS 1927 ("NAD27") and the played on a flat surface. These projec- Coordinate data are based on geo- North American Datum tions create distortions of shape, area, and distance. The different projec- detic datums. A geodetic datum, or of 1983 ("NAD83").” simply "datum," is a set of reference tions that we use in different parts of points on the Earth's surface relative the United States have been designed to which position measurements are other industries are already using to minimize the collective distortions made. NAD83. that they produce within those given Currently, in the fields of cartogra- It is important to note the difference areas. There are three fundamental phy and land-use, there are two hori- in horizontal location that results from types of projections: zontal datums in use in North application of one or the other of (Continued) America. These are the North American Datum of 1927 ("NAD27") and the North American Datum of 1983 ("NAD83"). Both are geodetic ref- erence systems based on ellipsoids. Ellipsoids are mathematical shapes that approximate the geoid, the geoid being the equipotential surface of the earth's gravity field that approximates mean sea level. Ellipsoids are defined by major and minor axes, flattening, and eccentricity parameters. NAD27 is based on the Clarke Ellipsoid of 1866. It is derived from land-based surveys with a geodetic center at Meades Ranch in Kansas. NAD27 is defined by the latitude and longitude of its geodetic center, the direction of a line between this point and a specified second point, and two dimensions that define the ellipsoid. NAD83 is based on the GRS80 ellip- soid, an ellipsoid derived from satel- lite geodesy. GRS80 is an Earth-cen- tered datum having no initial point or initial direction. The oil industry in North America primarily uses NAD27. Government and regulatory bodies are in the process of converting to NAD83. Most Figure 1. Magnitude of horizontal datum shift, in feet, between NAD27 and NAD83.

22 ______SIPES QUARTERLY Technology Corner Continued

 Azimuthal, where points on the ellipsoid are projected onto a pla- nar surface  Conic, where points are pro- jected onto a cone which is then unrolled to a plane (Figure 2)  Cylindrical, where points on the ellipsoid are projected onto a cylinder which is then unrolled to a plane (Figure 3) Lambert Conformal Conic projec- tions are used for rectangular zones with a larger east-west than north- south extent. Transverse Mercator (cylindrical) projections are used to define zones with a larger north-south extent.

Figure 4. Texas is composed of five State Plane Coordinate System (SPCS) zones.

STATE PLANE zones that are also long east-west. COORDINATE SYSTEM These zones use the Lambert confor- mal conic projection because it is good Because surveys are performed on at maintaining accuracy along an east- the curved surface of the earth and at west axis. Zones that are long in the different elevations, measurements north-south direction use the from different starting points will not Transverse Mercator projection mesh nor will the lines be rectilinear. Figure 2. Lambert conformal conic. The because it is better at maintaining In order to seamlessly connect survey cone is tangent to the surface of the ellip- accuracy along a north-south axis. soid at a particular latitude. When points work over greater distances, we use a Some smaller states use a single state are projected onto the cone and the cone is working plane with a rectangular plane. Larger states are divided into unwrapped to a plane, distortions are mini- grid. For domestic oil and gas applica- several zones, with state plane zone mized in the vicinity of this particular lati- tions, the State Plane Coordinate tude. boundaries often following county System (SPCS) is most common. The boundaries. Universal Transverse Mercator (UTM) In Texas, the Lambert conformal coordinate system is also fairly com- conic projection is used to project mon. from the earth's curved surface to a The State Plane Coordinate System planer surface. Five planer coordinate was developed in the United States in projection zones divide the state into the 1930s and was originally based on east-west bands of counties surround- the NAD27 datum. This system ing five particular latitudes. These are divides the United States into more the North (TX4201), North Central than a hundred distinct grid surfaces (TX4202), Central (TX4203), South ("zones"). Each state plane zone is Central (TX4204) and South (TX4205) based on either a Transverse Mercator SPCS zones (Figure 4). Figure 3. Transverse Mercator. The cylinder projection or a Lambert conformal The 1983 State Plane Coordinate is tangent to the surface of the ellipsoid at a conic projection. The choice between System is based on NAD83. NAD83 particular meridian of longitude. When the two map projections is based on coordinates are based on the meter points are projected onto the cylinder and the shape of the state and its zones. the cylinder is unwrapped to a plane, distor- while NAD27 coordinates are based States that are long in the east-west tions are minimized in the vicinity of this on U.S. Survey Feet. The U.S. Survey direction are typically divided into particular meridian. (Continued)

AUGUST 2010 ______23 Technology Corner Continued

Foot, it should be noted, is two parts per million longer than the International Foot, the former being 0.3048006 meters while the latter is 0.3048 meters. Coordinates from NAD27 and NAD83 do not resemble each other at all, though, even when NAD83 coordinates have been con- verted to U.S. Survey Feet. Different false eastings and false northings have been assigned to the two datums to prevent confusion between coordi- nates computed on each. While NAD27 has been superseded by NAD83 for many applications such as geodetic surveying, maps in the NAD27 State Plane Coordinate System are still the standard for oil and gas mapping activities. Figure 5. UTM zones spanning the continental United States.

UNIVERSAL TRANSVERSE DATA INTERCHANGE AND datums of your data and apply appro- MERCATOR (UTM) DATUM TRANSFORMATION priate coordinate transformations in COORDINATE SYSTEMS your mapping workflow. Coordinates When combining spatially refer- of proposed targets should be thor- The UTM system employs a series of enced data from different sources, oughly checked. Don't wait until you sixty zones worldwide, each 6° of lon- such as different vendors or partners, are rigging up or have already drilled gitude in width and centered on a the datum of the data must be correct- a non-legal location to find out that meridian of longitude. Eastings are ly identified and the mapping system you applied the wrong datum trans- measured from the central meridian must be able to handle datum trans- formation to critical data! (with a 500 km false easting to insure formations as needed. NAD27 is the positive coordinates). Northings are standard for oil and gas data in the Larry Rairden measured from the equator (with a United States and vendor data is com- can be reached at 10,000 km false northing for positions monly supplied conforming to this rairden@novageo- south of the equator). UTM Zones are datum. Survey and culture shapefiles, science.com. numbered from 1 to 60. Zone 1 is on the other hand, often come with bounded by longitude 180° to 174° W NAD83 datum and require conversion If you have a and is centered on the 177th West upon import into the oil and gas map- Technology Corner meridian. Zone numbering increases ping system. Mapping software article that you would in an easterly direction. The continen- should be able to handle such conver- like to submit for tal United States spans ten UTM sions. GIS utilities are available to per- publication in the zones, from UTM Zone 10 to UTM form these transforms if your favorite SIPES Quarterly, Zone 19 (Figure 5). The UTM coordi- workstation is not up to the task. please email it to Dick Cleveland at nate system is based on the WGS84 The bottom line is this: know the [email protected]. ellipsoid. 

24 ______SIPES QUARTERLY S OCIETY OF II NDEPENDENT P ROFESSIONAL E ARTH S CIENTISTS Advertising and Sponsorship Order Form SIPES 48th Annual Meeting & Convention

JUNE 20-23, 2011  JACKSON HOLE, WYOMING

2011 CONVENTION ADVERTISING RATES

Business Card (2"h x 3.5"w) ...... $60 Quarter Page (5" h x 3.35" w)...... $120 Half Page (5"h x 7" w) ...... $200 Full Page (10"h x 7.5"w) ...... $350 Sold! Inside Front Cover (Color) ...... $500 Sold! Outside Back Cover (Color) ...... $500 Inside Back Cover (Color)...... $500

Your ad will appear in the 2011 Convention registration book, the program book, and the 2011 Membership Directory CD

2011 CONVENTION SPONSORSHIP RATES Silver Sponsor...... $500 Gold Sponsor...... $1,000 (Gold Sponsors receive one complimentary convention registration) Platinum Sponsor...... $2,000 (Platinum Sponsors receive one complimentary convention registration and a complimentary 1/2 page ad)

Sponsor company names and logos will be included on the main page of the SIPES website (www.sipes.org). Names can be hyperlinked to company webpages or to an e-mail form. Company names and logos will be printed in the convention registration and program books, and on a banner that will be displayed at all convention functions. Sponsors may also choose to host or co-host a convention event.

Circulation: SIPES Members, Industry Customers, Individuals Responsible for Directing Purchases of Goods and Services Deadline for Inclusion: January 17, 2011  Publication Dates: March & June 2011  Ad Format: Camera-ready or digital

ORDER FORM & PAYMENT OPTIONS - Please Circle Your Selection Business Card Quarter Page Half Page Full Page Cover Page Silver Sponsor Gold Sponsor Platinum Sponsor

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Payment Information: Please Circle Form of Payment Make Checks Payable to: SIPES 2011 Convention Payment Enclosed Bill Me* VISA MasterCard Discover American Express (*Payment must be received by January 17, 2011 for inclusion in publication) CREDIT CARD INFORMATION

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Mail or Fax this order form with copy of ad/business card to: SIPES, 4925 Greenville Ave., Suite 1106, Dallas, Texas 75206 Phone: 214-363-1780 Fax: 214-363-8195 E-mail: [email protected]

AUGUST 2010 ______25 SIPES Foundation Donors — August 1,, 20092009 tto August 1,, 2020110

$4000 - $4999 $400 - $499 Lee M. Petersen Thomas E. Ewing SIPES Houston Chapter Raymond N. Blackhall In memory of Charles E. Mear Bruce W. Fields National Park Fossil Guidebook Scholarship Endowment Fund Scholarship Endowment Fund Edward B. Picou, Jr. 2010 Seminar Speaker In memory of Jack O. Colle William M. Frew National Park Fossil Guidebook Robert D. Gunn Michael A. Pollok Clement E. George  National Park Fossil Guidebook National Park Fossil Guidebook Scholarship Endowment Fund National Park Fossil Guidebook $1000 - $1999 Terry L. Hollrah Larry J. Rairden Scholarship Endowment Fund Scholarship Endowment Fund Donald C. Gifford William C. Burkett In memory of Roy E. Hollrah National Park Fossil Guidebook In memory of Jerry A. Cooper Rudolf B. Siegert Scholarship Endowment Fund Marcus D. Maddox In memory of Thomas A. Cullinan Bobby M. Greenwood In memory of Dick Grice David N. Grimes National Park Fossil Guidebook Stephen A. Sonnenberg Kenneth J. Huffman National Park Fossil Guidebook National Park Fossil Guidebook In honor of Frank Sonnenberg George P. Mitchell M. R. Stipp Frank W. Harrison, Jr. David L. Read  Edward A. McCullough Endowed Fund Marc H. Helsinger 2010 Seminar Speaker $300 - $399 National Park Fossil Guidebook Scholarship Endowment Fund W. Ralph Holloway Tom and Evonne Smith Craig W. Adams C. Al Taylor, Jr. Jimmy D. Thomas Stephen E. Collins Memorial George W. Todd Lanny O. Butner Scholarship Fund Scholarship Endowment Fund for William F. Von Drehle Engineering Students Lloyd K. Parrish, Jr. Robert W. Waring Van Howbert Scholarship Endowment Fund National Park Fossil Guidebook Richard O. Williams Mark A. Worthey Dan A. Hughes National Park Fossil Guidebook James M. Zotkiewicz Stephen R. Robichaud National Park Fossil Guidebook  Scholarship Endowment Fund H. Vaughan Watkins, Jr.  Dudley J. Hughes $600 - $699 Stephen E. Collins Memorial C. M. Jacobs Scholarship Fund $100 - $199 Robert B. Ferguson National Park Fossil Guidebook A. Darryl James John T. Abney  In memory of Larry Gnagy Earl E. Gaertner Craig F. Anderson In memory of Jackie Gaertner $200 - $299 National Park Fossil Guidebook Alfred James III Larry L. Jones James B. Bennett Donald I. Andrews George R. Jones George D. Klein Marvolene Speed Bennett Ralph W. Baird Robert C. Leibrock & Carleton D. Speed, Jr. Fund Paul D. Lerwick In memory of Robert O. Anderson Edward A. McCullough Endowed Fund Louis C. Bortz National Park Fossil Guidebook National Park Fossil Guidebook Teresa H. Becker Sally J. Meader-Roberts  Raul F. Brito Scholarship Endowment Fund National Park Fossil Guidebook John R. Melton Timothy J. Bennett $500 - $599 Michael S. Morris Garnet W. Brock National Park Fossil Guidebook Michael N. Austin National Park Fossil Guidebook Robert G. Murphy Foy W. Boyd, Jr. Hugh C. Pendery W. Chris Barnhill Hardtner L. Coon Robert E. Boyer National Park Fossill Guidebook Scholarship Endowment Fund Michael G. Pitzer Herbert L. Brewer National Park Fossil Guidebook David A. Eyler Roger A. Freidline Paul W. Britt Dennis M. Gleason Robert E. Pledger 2010 Seminar Speaker Bill D. Broughton David M. Pulling Edward F. Haye Leonard E. Bryans James A. Gibbs Dick S. Horton John W. Raine III In memory of Mike P. Braziel Alfred T. Carleton, Jr. Scholarship Endowment Fund George S. Johnson James R. Cleveland Owen R. Hopkins In memory of Robert Klabzuba John M. Rakowski Arthur L. Cochrum National Park Fossil Guidebook Gary C. Huber Richard R. Lindsly C. Walter Dobie In memory of Suzy Parkison Jack K. Richardson In memory of Robert L. Swanson Marlan W. Downey National Park Fossil Guidebook In memory of William E. Jackson Duncan D. Dubroff H. Jack Naumann, Jr. Robert H. Marshall Julius M. Ridgway Ralph C. Duchin Ronald W. Pritchett James F. O’Connell National Park Fossil Guidebook Merle J. Duplantis Gary W. Palmer A. Scott Ritchie Scholarship Endowment Fund Cecil R. Rives In memory of Mark Eidelbach Wayland C. Savre Eugene R. Sidwell Byron F. Dyer H. Rudy Parkison Charles D. Schmidt Arlen L. Edgar Joe T. Vaughn M. Davis Payne C. Randall Schott In memory of M. H. Vaughn In memory of Helen Brauer, National Park Fossil Guidebooks and Jackie Gaertner C. Ray Scurlock  Elwin M. Peacock National Park Fossil Guidebook Roy G. Sharrock National Park Fossil Guidebook James P. Evans III (Continued) In memory of Thomas A. Cullinan

26 ______SIPES QUARTERLY New Films Now Available from the SIPES Foundation Film Library See sipes.org for NEW! The following new titles from the 2010 SIPES Convention in Colorado Springs more information are now available for sale or rent in DVD format. Rent 3 — Get 1 Free! on how to order.

Conventional Oil  "Resource Constraints on Alternative Energy Technologies" —  "Reservoir Geology and Secondary Recovery at Kleinholz Jim Burnell Field, Kimball County, Nebraska" — Steve Goolsby Case Histories  "PiZon Field Study, Implications for Texas Overthrust Natural  "Are There Any More Lyons Oil Fields to be Found in the Gas Exploration" — Dick Boyce, #3245 Denver Basin?" — Don Hembre, #1763  "Developing an Exploration Tool in a Mature Trend: A 3-D  "Petroleum Geologic Framework of the Tucumcari Basin, AVO Case Study in South Texas" — Mark Gregg, #2883 East-Central New Mexico, With a Synopsis of Recent Exploratory Activity" — Ron Broadhead  "The Lower Mississippian of the Midcontinent - Stratigraphic Architecture, Lithostratigraphy, and Petroleum Reservoirs" — Sal  "Hartzog Draw and the Shannon Sandstone: New Mazzullo Observations and Constraints Applied to Depositional Models" Unconventional Reservoirs — Clayton Painter Alternate Energy  "Characteristics of Successful Shale Resource Plays, North America" — Dan Jarvie  "Renaissance of Nuclear Energy - From Well Field and Mine Production to the Nuclear Reactor" — James Graham  "‘Unconventional' Discovery Thinking in Resource Plays: Haynesville Trend, North Louisiana" — Marv Brittenham  "A Source of Electrical Power, Waste Water from Oil Production" — Lyle Johnson  "Application of Vitrinite Reflectance to Woodford Gas-Shale Plays in Oklahoma" — Brian Cardott  "Opportunities and Challenges Relative to the Development of Power Transmission in the West" — Loyd Drain  "The Bakken Petroleum System Tight Oil Resource Play of the  "Carbon Sequestration - The Challenges for a New Industry" Williston Basin" — Steve Sonnenberg, #2158 — Dag Nummedal

Foundation Donors Continued

Vinton H. Sholl $50 - $99 Floyd E. Heard Christopher P. Renaud National Park Fossil Guidebook Joel A. Alberts In memory of Betty Heard In memory of Charles B. Renaud Robert C. Shoup James K. Anderson Nolan Hirsch Richard H. Sams D. Craig Smith National Park Fossil Guidebook Wayne Lebsack In memory of Gail Oliphant Daniel L. Smith Donna F. Balin Clayton E. Lee Valary L. Schulz Thomas J. Smith Donald G. Becker, Jr. National Park Fossil Guidebook In memory of Tom Mairs William M. Smith In memory of Donald G. Becker, Sr. Henry C. Libby Carol M. Shiels Scholarship Endowment Fund James L. Brezina Edward A. McCullough Endowed Fund R. David Shiels In honor of A. T. Carleton Marion E. Spitler William T. Brown, Jr. John D. Silvernail National Park Fossil Guidebook Scholarship Endowment Fund Eugene J. Lipstate In memory of Colles C. Stowell Michael W. Taylor Jack C. Cartwright Steven R. Lockwood Jeffry A. Smith Robert E. Tehan James W. Caylor Donald J. Malone Joe H. Smith Richard W. Thompson, Jr. Jene C. Darmstetter Jack P. Martin National Park Fossil Guidebook Stephen E. Collins Memorial In memory of Harry Westmoreland James W. Denny National Park Fossil Guidebook Scott A. Wainwright Scholarship Fund William G. Watson Rebecca L. Dodge H. E. Mathy Arthur H. Trowbridge National Park Fossil Guidebook National Park Fossil Guidebook Robert W. Maxwell, Jr. National Park Fossil Guidebook Gary M. Weir In memory of Roy T. Hazzard Toby Elster Louis J. Mazzullo and Jeff Nunnally Michael N. Fein Scholarship Endowment Fund Bonnie R. Weise George R. White True Electric Paul D. Friemel Patrick H. McKinney Scholarship Endowment Fund National Park Fossil Guidebook C. G. Tyner Eric L. Michaelson Scholarship Endowment Fund William J. Furlong In memory of Louis H. Michaelson Richard Wilkerson National Park Fossil Guidebook Michael R. Vasicek Eduardo Gonzales Wayne D. Miller In memory of Victor F. Vasicek Ralph O. Wilson II Robert M. Grace Herbert G. Mills and Jack G. Elam National Park Fossil Guidebook John C. Worley Craig E. Moore John R. von Netzer National Park Fossil Guidebook David R. Grogan Marvin A. Munchrath Rodger L. Walker John C. Grunau   E. Gordon Reigle Dean C. Hamilton National Park Fossil Guidebook The SIPES Foundation gratefully accepts all donations and acknowledges these contributions with a letter. Due to limited space in the newsletter, we are unable to list gifts under $50.

AUGUST 2010 ______27 Return to: PRESORTED STANDARD SIPES US POSTAGE 4925 Greenville Avenue, Suite 1106 PAID DALLAS, TX Dallas, Texas 75206-4019 PERMIT NO. 1300

ADDRESS SERVICE REQUESTED

President ...... Kenneth J. Huffman ...... New Orleans 2010-2011 Vice-President...... J. Phil Martin, Jr...... Houston Vice-President of SIPES National Energy ...... Marc D. Maddox ...... Midland Secretary...... Dennis M. Gleason ...... Fort Worth Officers Treasurer...... Thomas J. Smith...... Oklahoma City

Donna F. Balin...... Chapter Participation...... San Antonio

J. R. Cleveland ...... Technology Communication/SIPES Quarterly ...... Dallas

Suzanne G. Cluff...... Environmental/SIPES Quarterly ...... Denver SIPES James P. Evans III...... Advertising...... New Orleans William R. Finley...... Constitution/Nominating Committee...... Lafayette

Directors Bobby M. Greenwood...... Headquarters/Membership ...... Dallas

James F. Hardwick...... DirectoryMembership...... Lafayette

H. Jack Naumann, Jr...... Professional Society Liaison...... Midland

Larry J. Rairden...... NAPE/2011 Convention ...... Houston

SIPES Vision Statement

To be the pre-eminent organization for furthering the professional and business interests of independent practitioners of the earth sciences. In achieving this vision, emphasis will be placed on (1) professional competence, (2) professional business ethics, and (3) presenting a favorable, credible and effective image of the Society.

Adopted by the SIPES Board of Directors September 21, 1996