LOGA Ready to Meet New Challenges
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FEBRUARY 2013 The “Better Business” Publication Serving the Exploration / Drilling / Production Industry LOGA Ready To Meet New Challenges By Del Torkelson operators. The bills that passed near the Texas, Oklahoma or Colorado.” end of the 2012 Louisiana Legislature, BATON ROUGE, LA.–Some, when which build on earlier LOGA-backed The Long View they achieve a long-sought goal, are con- legacy reforms, allow parties to assume In its first online weekly drilling report tent to forego any further struggle. Others responsibility for remediation without of 2013, LOGA noted the statewide count strive to follow-up, but fall short of the saddling them with liability for private of 102 drilling rigs fell 48 short of the standard set by their previous accom- damages (AOGR, July 2012, pg. 16). same figure a year ago. Briggs reasons plishment. Then there are those who keep LOGA Chairman Bryan Hanks, pres- that trend follows logically from a number on keeping on–and in the process–collect ident and chief executive officer of BETA of factors, including natural gas prices’ numerous victory laurels on which they Land Services LLC in Lafayette, La., extended slump. And while Louisiana never rest. says he hopes the new legal setting will contains a number of formations that Thomas Edison was already world fa- reassure oil and gas companies that could one day spur exciting resource mous for inventing the phonograph when Louisiana is a good place to do business. plays, he says, the fruit is not yet ripe. he received a patent for his incandescent “Louisiana’s legacy lawsuits have been a The Tuscaloosa Marine Shale that runs light bulb, a creation which itself preceded known entity for operators across the through Central Louisiana, North his pioneering innovations in motion pic- country,” he reflects. “Even though we Louisiana’s Brown Dense, and the ultra- ture technology. The Beatles were atop passed very positive legislation last year, deep frontier along the coast may have the rock and roll world when Sgt. Pepper’s people still may be hesitant about coming bigger futures, he predicts, but steep Lonely Heart’s Club Band came out, but here because they feel they will be tar- capital demands help to constrain their the releases still to come included the gets.” present. “white album” and Abbey Road. John LOGA President Don G. Briggs main- “There are only three rigs working in Wooden already had a pair of national tains the entire state will benefit if pro- the Tuscaloosa Marine Shale, where the titles when he began the streak of coaching ducers across the country decide Louisiana wells are deep and expensive, but I hear seven consecutive men’s college basketball will treat them fairly–a conclusion they they have found a couple of nice sweet championship teams. are unlikely to reach if the state’s policy- spots,” Briggs describes. “A couple com- For the Louisiana Oil & Gas Association, makers muddle the message of last year’s panies are plugging away and moving the drive to keep plugging away even after legislation. As the association prepares around in the Brown Dense.” significant wins has been a matter of ne- for the 2013 Louisiana Legislature, he “People have been hopeful but cautious cessity. When its members gather for the observes that Governor Bobby Jindal is about the Tuscaloosa Marine Shale, so I group’s annual convention, March 11-13 on record expressing a desire to eliminate do not think that surprises anyone,” Hanks at the L’auberge du lac Casino Resort in the state’s corporate and personal income ruminates. “Everybody still seems hopeful Lake Charles, La., they will do so only taxes (see accompanying story). Intriguing about the ultra deep, but there is a learning months after seeing LOGA cross a long- as that may seem, Briggs says LOGA is curve and there are equipment challenges sought priority off its to-do list. warning against any efforts to turn such associated with those depths and tem- With the passage of legislation to re- a proposition into a convenient tax shifting peratures. I still think there is a long- form the law regarding the state’s legacy mechanism. term vision for it.” lawsuits, the association hopes producers “We are trying to help everyone un- Meanwhile, Briggs acknowledges, the will find a way to cut through the net of derstand this is not a localized market,” play that recently enjoyed Louisiana’s questionable litigation that has ensnared he relates. “Companies can spend their top billing is experiencing a lull. “People a significant proportion of South Louisiana money here or in Ohio, Pennsylvania, are not looking for dry gas,” Briggs ac- Reproduced for the Louisiana Oil & Gas Association and Beta Land Services with permission www.aogr.com Convention Sec tion: Louisiana Oil & Gas Association knowledges. “Once, there were 140 rigs Furthermore, Briggs notes, an analysis to it because I have been the guy with running in the Haynesville. Now there by Louisiana State University Professor the lease in my hand,” he relates. “I are 20.” David Dismukes calculates that new proj - intend to see it at a time when the theater Nevertheless, Hanks insists the interval ects drawn by the magnet of affordable is not very full, because I am sure I will is neither unexpected nor permanent. He and reliable gas supplies could bring have a running, open commentary that I recounts that when his company was 214,000 jobs and $9 billion in new wages cannot guarantee will remain under my helping clients secure Haynesville leases in less than a decade. Briggs quotes Dis - breath.” in the play’s headiest days, operators rec - mukes as saying that being flush with Hanks says he would like to see the in - ognized their long-term development natural gas “has led to a virtual manufac - dustry hit back by promoting and distributing plans could require some patience. “The turing renaissance in Louisiana where, films such as FrackNation , a new docu - people we were working for predicted to date, some $62.3 billion in new capital mentary with a more evenhanded take on they would drill to tie up lease positions investments have been announced.” fracturing by independent filmmakers Ann and then proceed according to the gas and Phelim Media LLC. LOGA has re - pricing scenario,” he recalls. “I was pre - Fact And Fiction sponded to Promised Land by offering a pared for it to drop simply because more When it comes to competing with video response on the association’s website product was coming on.” other states for companies’ drilling dollars, that refutes Promised Land ’s inaccuracies. While the slow period marks a first Louisiana’s longtime familiarity with the Other than that, he says, instead of dropping for many people who have entered the oil and gas industry may offer one factor mass media bombs, the industry will con - industry in the unconventional resource in its favor. While numerous other states tinue to fight untruths with the equivalent play era, Hanks reflects, it is familiar to host ongoing or prospective resource of hand-to-hand combat. anyone with a couple decades’ oil and plays, few of their populations have as “Thanks to the Internet, in the last gas experience. “The younger people are much history with oil and gas as the Pel - five years, landowners across the country seeing it for the first time because they ican State. As localities in places from have become 100 times more sophisti - have been in the industry only as the New York to Colorado ban hydraulic cated,” Hanks describes. “I find myself shale plays have ramped up,” he com - fracturing and craft regulations that render trying to explain scenarios that may have ments. “They will learn our industry will many projects not worth the trouble, happened in Ohio, Colorado or Pennsyl - live through this and ramp up down the Briggs says Louisiana parishes have vania, where the regulations and landowner road. The good news is that technological proven less susceptible–though not im - rights may be far different. Because of developments may make those cycles mune–to anti-fracturing alarmism. that, the people I send into the field to quicker than they used to be.” Media misrepresentations about frac - meet and negotiate with landowners re - Nevertheless, Briggs notes, some places turing’s risks, including the Hollywood quire far more training than in the past.” beyond Louisiana’s borders continue to film Promised Land , which was released Consequently, he says, in only three attract major investment. The Eagle Ford to theaters nationwide in January, have years, BETA Land Services’ training Shale in neighboring Texas, he says, helps not helped, he acknowledges. Briggs saw manual has grown from three quarters of illustrate that policymakers are wise to the film shortly after its release, he says, an inch to a pair of three-inch binders. consider the broader context of oil and indicating the production mixes the gen - Only when a landman has been apprised gas policy. Many companies with prop - uine with the fallacious. Scenes in which of the facts can he hope to help laypeople erties in Louisiana have operating horizons a landman participates in community recognize the fiction. “I tell our guys 50 that extend well beyond the state’s borders, meetings were sufficiently true-to-life, percent of the job is educating landown - he points out. Naturally, they will invest Briggs says. ers,” Hanks relates. their capital in projects they expect will In fact, he continues, such depictions One approach that Hanks says his provide the best returns. “We are com - made him feel as if he was back in North - team prefers in shale areas foregoes tra - peting with the rest of the country,” Briggs west Louisiana when the Haynesville ditional individual meetings in favor of emphasizes.