Barton progress agriculture and oil 2017

GREAT G GR REA EAT BEND EAT BEND BE END ND KAN. KA K AN. N. TR TRIBUNE RIB BUN UNE • SSU SUNDAY, UND DA AY Y, FEBRUARY FEB BRUARY 12, 2017 •

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FACING THE FUTURE

Ag, Oil & Industry

PROGRESS Special to the Great Bend Tribune • Sunday, February 12, 2017

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• GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017

DALE HOGG Great Bend Tribune

Land values in Kansas and Oklahoma haven’t changed much from mid-year 2016.

Area ag land values hold steady Interest rates will play a role in setting the stage

O

MAHA, Neb. – Several factors will come into play in 2017 that will determine the direction of land values.

Randy Dickhut, senior vice president of real estate operations for Farmers National Company, said that in the past three years, agricultural landowners in many regions across the country have seen a decline in profits, which also pushed land values lower. “This winter, questions abound as to the direction of commodity prices, interest rates, inflation, challenges in the world economy, weather and U.S. tax law,� Dickhut said. “Buyers of ag land are asking if it is an opportune time to make a purchase of a farm or ranch, while sellers are asking if the market dynamics are indicating that it is good time to sell land.

Depending on location, quality of land and other factors, our agents report seeing regions and local areas where land prices

are stable to somewhat strengthening post-2016 harvest. Then there are other areas where land values have continued to decline.�

A key factor impacting land prices will be interest rates, Dickhut said. Grain and livestock prices affecting farm and ranch income also will influence land values. “Foreign trade policy and its effect on agriculture will be closely watched over the next few months. Potential changes in tax laws could affect estate taxation and capital gains rules that in turn influence buying and selling decisions,� Dickhut said.

Kansas, Oklahoma Land values in these two states haven’t changed much from mid-year 2016, reports Brock Thurman, AFM, vice president and area sales manager based out of Kiowa. “Top quality land is still holding the same values if in the right location,� he said. Medium quality land has seen a slight decline of five percent, Thurman said, while poor quality land has been difficult to sell. “It could be down 50 percent from the top when it’s in poor condition and not in a good location. Location is key,� he said.

Thurman said he doesn’t anticipate significant changes in land values for the first half of 2017 and possibly beyond.

“High quality land will remain stable most likely due to investor money coming back into the equation,� he said. “Medium quality land ought to remain steady for the same reason. Low quality land will remain soft.�

Auctions remain the best method for moving medium- to high-quality land, Thurman said. “We are using private and phone auctions on some tracts and it appears to be working well.�

Some privately sold land has been sitting on the market for extended periods of time, because it was priced too high, Thurman said. So far, there have been only a few tracts that didn’t sell. “Conversely,

approximately 95 percent of public land auctions close the day of the auction or the week of the auction,� he said.

The most active sellers to date have been absentee owners who were aiming for high value peaks, but now simply want to sell before any perceived crash, Thurman said. “We are seeing a new wave of interest from investors,� Thurman said. “Farmers are still buying the ‘right’ farm if it is available, something next door or a good addition to a current operation. Investors are looking at better values than the past three or four years.�

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GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017 •

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DALE HOGG Great Bend Tribune

Seen from a distance, the massive Bartlett Grain bins gleam in the winter sun.

Bartlett Grain expands to help area farmers

BY RUSSELL EDEM

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he Bartlett Grain Co. of Great Bend is expanding its storage capacity for area farmers by adding additional storage bins to help with the wheat harvest growth in Barton County.

“In the current market we have add some large crops locally. So adding storage space to accommodate the local farmers is very important,” grain buyer Andrew Fullerton said. “The area farmers work hard and we are here to help them along the way.”

The construction started in 2014 to help with the increase of wheat. After the construction is finished by early June the facility will be able to store an additional 2.3 million bushels.

“What we have seen in the past few years is timely rain fall,” Fullerton said. “This rain fall has helped with the wheat growth and this is why we decided that additional storage space was needed. We had to provide storage to not only local farmers but we also buy wheat from other grain elevators from all over the state.

The general contractor for the facility was Mid-States Millwrights and Builders based in Nevada, Iowa, which specializes in the type of construction Bartlett is building.

The electrical work has been contracted to

Myers Electrical based in Sterling. Haynes Electric of Larned has also performed some electrical work.

All site excavation was completed by Stone Sand Company, Inc. of Great Bend.

The office building and scale house was constructed by Brentwood Builders, based in Great Bend.

This will be the company’s 10th elevator in Kansas, including one at 3311 N. Emporia in Wichita. Bartlett is a family owned and managed company which has been operating grain elevators in Kansas since 1907. Bartlett operates facilities in Scott, City, Healy, Levant, Moscow, Wichita and three in the Kansas City metro area.

According to Bartlett, the Company is a diverse, growth-oriented agri-business company. Its principal businesses are grain merchandising, flour milling, feed manufacturing and cattle feeding.

Headquartered in Kansas City, Missouri, with facilities and offices in 11 states and Mexico. The company is more than 100 years old and still family owned and managed.

The company is committed to providing its customers superlative service and finding ways to meet their business needs.

Market expertise and logistics capabilities enables the company to connect producers and consumers in the most efficient and cost effective ways possible.

DALE HOGG Great Bend Tribune

A grain-hauling train pulls past Bartlett Grain east of Great Bend.

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• GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017

On the cutting edge of biodefense

BY STAFF REPORTS

MANHATTAN — It is fitting that Kansas State University be the front lines for the nation’s bio and agrodefense efforts, Congressman Roger Marshall told members of the bipartisan Blue Ribbon Study Panel on Biodefense which visited the Manhattan campus on Thursday, Jan. 26, for a series of agrodefense discussions. “Kansas is agriculture; agriculture is Kansas,� Marshall said. “Kansans have proven themselves in leading and preventing potential outbreaks.�

A freshman Great Bend Republican, Marshall was elected to Congress this past November.

He sits on the House Agriculture Committee. “Zoonotic diseases are going to require physicians, veterinarians and researchers to work together,� he said. “I see that my role is to push these people together. I see incredible opportunity with NBAF to work with those people and further the collaboration.�

The conclusion: What Silicon Valley is to technology, Kansas State University is to biodefense.

And when former Senate Majority Leader Tom Daschle and panel on Biodefense visited KSU, the university cemented its status as a national leader in animal health, biosciences and food safety research. “K-State has really become the Silicon Valley for biodefense,�

Daschle said. “Its Biosecurity Research Institute, links to the Kansas Intelligence Fusion Center and the National Bio and Agrodefense Facility are all illustrative of the extraordinary effort that is now underway in Manhattan.

It’s an amazing demonstration of innovation, of collaboration and of engagement.� “Collaboration requires a convener. Collaboration requires leadership,� Daschel said. “I believe that K-State is in a very good position to be that convener, to be that leader and to create opportunities for better dialogue and engagement with others as we consider the na-

COURTESY PHOTO

Kansas State University president Richard Myers speaks to the Blue Ribbon Study Panel on Biodefense.

With Myers, from left, are Asha George, co-director; Tom Daschle, former Senator majority leader and panel member; Kenneth Wainstein, former Homeland Security adviser to President George W. Bush and panel member; and Ellen Carlin, co-director. The panel visited the Manhattan campus for a series of agrodefense discussions.

COURTESY PHOTO

Kansas State University is the ‘Silicon Valley for biodefense,’ according to Blue Ribbon Study Panel.

tional challenges we face. That’s going to take a real effort and I think K-State is well-positioned to do just that. “As agriculture is elevated in terms of recognition and importance, it will be important for K-State to play a key role in giving us the kind of direction and public policy approach that is necessary to get the job done

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right.�

Daschle and legislators, scientists, academic leaders and industry representatives visited the university for a series of discussions, titled “Agrodefense: Challenges and Solutions.�

Daschle and other panel members and staff attended to learn about better ways to protect the country’s food supply and fight bioterrorism.

The Blue Ribbon Study Panel on Biodefense — chaired by former Sen. Joe Lieberman and former Secretary of Homeland Security Tom Ridge, a former governor of Pennsylvania — recommends changes to U.S. national policy and law to strengthen biodefense. The panel intends to produce a report to share with the country’s new administration, Congress and the public by the end of the year. “One of the centerpieces of our report is the recommendation to try and coordinate information-sharing efforts among the different and often disparate parts of state and local governments that address biothreats,� said the Honorable Kenneth Wainstein, panel member and former Homeland Security adviser to President George W. Bush. “Nowhere is that as important, and the need as marked, as in the agriculture area.�

Research facilities and programs in the ‘Silicon Valley for biodefense’ As the Silicon Valley for biodefense, Kansas State University and Manhattan have numerous facilities, research collaborations and academic programs devoted to agrodefense and biodefense. • The university’s Biosecurity Research Institute, or BRI, at Pat Roberts Hall is a biosafety level-3 facility that addresses threats to plant, animal, and human health and food contamination through infectious disease and pathogen research. The institute is jumpstarting research on NBAF diseases, including Japanese encephalitis, Rift Valley fever, classical swine fever and African swine fever. • The university’s College of Veterinary Medicine has research strengths in animal health infectious diseases, comparative biomedical science and food safety and security. • The university’s College of Agriculture conducts research in agricultural and horticultural crops, livestock, natural resources and the environment. • The National Agricultural Biosecurity Center, or NABC, unites biosecurity researchers with federal, state and local agencies to provide a response to emerging agricultural threats. • The U.S. Department of Homeland Security’s Center of Excellence for Emerging and Zoonotic Animal Diseases, or CEEZAD, develops countermeasures for emerging high-priority animal diseases that can spread to humans. • The U.S. Department of Agriculture’s Center for Grain and Animal Health Research is home to five research units in Manhattan: the Arthropod-Borne Animal Diseases Research Unit, the Engineering and Wind Erosion Research Unit, the Grain Quality and Structure Research Unit, the Hard Winter Wheat and Genetics Research Unit and the Stored Product Insect Research Unit.

See BIODEFENSE, 5

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COURTESY PHOTO

Pictured is the U.S. Department of Homeland Security’s National Bio and Agro-defense Facility under construction at Kansas State University in Manhattan.

BIODEFENSE, from page 1 During the panel, Kansas State University researchers discussed their work on emerging diseases — Zika virus, West Nile virus, avian influenza and porcine epidemic diarrhea virus, known as PEDv — as well as efforts to fight biological terrorism, such as the anthrax events of 2001, which affected Daschle.

They also discussed pursuing biodefense through partnerships with government, industry and other universities.

“We want to be a good partner in the effort to protect our nation’s food supply, both plant and animal,” said Kansas State University President Richard Myers, former chairman of the Joint Chiefs of Staff during the aftermath of the Sept. 11 attacks.

“We have expertise and facilities here that enable us to do this.”

“Preventing an attack is going to be knowledge-

based. We need to know everything possible about the pathogens and the potential perpetrators, said Stephen Higgs, KSU associate vice president for research and director of the Biosecurity Research Institute. Know the agent. Know the agencies that are involved. The type of research, education and training conducted at the Biosecurity Research Institute is critical to gain that sort of knowledge.”

“We cannot simply discuss One Health anymore, but we must embrace it,” said Tammy Beckham, dean of Kansas State University’s College of Veterinary Medicine. “We need surveillance systems that can share information from the animal sector to the human health sector. We need surveillance systems that are not agent or disease based, but are more broadly syndromic based so that we have early detection for these emerging diseases.”

COURTESY PHOTO

U.S. Rep. Roger Marshall of Kansas speaks to the Blue Ribbon Study Panel on Biodefense during the panel’s visit to Kansas State University. Marshall, a physician, discussed collaboration to combat zoonotic diseases.

The National Bio and Agro-defense Facility, or NBAF, is the U.S. Department of Homeland Security’s foremost animal disease research facility.

The $1.25 billion facility is a biosafety level-4 laboratory and will replace the aging Plum Island Animal Disease Center in New York. NBAF is expected to be operational by 2022-2023.

After a three-year site selection process, Manhattan, was selected as the location for NBAF. The facility is under construction on Kansas State University’s Manhattan campus and is adjacent to the university’s Biosecurity Research Institute. This strategic location places NBAF near important veterinary, agricultural and biosecurity research and expertise.

According to the World Health Organization, approximately 75 percent of new and emerging infectious diseases are zoonotic diseases which may be transmitted from animals to humans. The United States currently does not have a laboratory facility with maximum biocontainment (BSL-4) space to study highconsequence zoonotic diseases affecting large livestock.

The NBAF will be the first laboratory facility in the U.S. to provide BSL-4 laboratories capable of housing cattle

and other large livestock. The NBAF will also feature a vaccine development module to augment its laboratory research and accelerate the transfer of new science and technology into the marketplace.

The NBAF’s location in Manhattan places it within the Kansas City Animal Health Corridor, the largest concentration of animal health companies in the world.

The NBAF will be constructed and operated on a secure federally owned site on the northwest corner of the Kansas State University (KSU), adjacent to KSU’s Biosecurity Research Institute in Pat Roberts Hall.

Animal disease research is currently performed at the Plum Island Animal Disease Center (PIADC).

However, the aging facility is nearing the end of its lifecycle. It is also too small to meet research needs in relation to emergent and foreign animal disease threats.

The NBAF is necessary to meet the requirements of Homeland Security Presidential Directive 9 (HSPD-9).

As the joint mission of DHS, USDA’s Animal and Plant Health Inspection Service (USDA - APHIS) and USDA’s

Agricultural Research Service (USDA – ARS) expands to meet these challenges, a new facility with more integration, expanded biocontainment capabilities and larger physical space is necessary to fulfill future needs.

The Biosecurity Research Institute (BRI) at Pat Roberts Hall on the Kansas State University campus is a unique biocontainment research and education facility.

The BRI supports comprehensive “farm-to-fork” infectious disease research programs that address threats to plant, animal, and human health. Home to 113,000 square feet of lab, education, and administrative space, this BSL-3, ABSL-3 and BSL3-Ag facility offers countless research and education opportunities.

The concept for a facility dedicated to the protection of crops, livestock, food, and people from biological threats evolved from two key documents written in 1999.

Research at the BRI aims to ensure a safe food supply, protects public health and helps prevent major economic losses to U.S. agriculture.

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• GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017

DALE HOGG Great Bend Tribune

The Summer Street Stroll Farmers Market will continue to operate on Thursday nights this year at the southeast corner of the Barton County Courthouse Square, as seen here in this 2015 photo.

‘Local food’ a growing movement in Barton County Summer Street Stroll Farmers Market will have move vendors in 2017

BY VERONICA COONS vcoons@gbtribune.com

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Google search of “locally grown food” brings up a plethora of websites touting the benefits of produce grown and purchased close to home. Word has gotten out that Great Bend has a state registered farmers market which is attracting more vendors from surrounding counties. Thanks to this, Barton County is beginning to claim a greater presence in this movement, and the results are, well, mouth watering.

The beginnings were modest, with a handful of growers, crafters and artisans agreeing to take part in what was essentially an experiment a few years ago. The City of Great Bend Community Coordinator Christina Hayes organized a Thursday night downtown retail promotion, Summer Street Stroll, offering shoppers not only later hours to shop, but additional draws including entertainment and a state-registered farmer’s market at the Courthouse Square.

Janel Rose is the Director of the Barton County Health Department. She is the administrator of the market for the city, and the Senior Farmer’s Market

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For seniors who qualify, the program, provides them with a set amount of dollars they can use to purchase fresh and flavorful tomatoes, peppers, melons and more at farmers markets. Vendors have to be licensed, and set up to use the EBT system through the Kansas Department of Agriculture.

The program definitely expanded in 2016. In fact, it has been one of the major driver in growing not only in the number of shoppers attending, but also in the number of vendors who are seeking to participate. The upcoming season will be the fourth year for the program locally, and Rose expects it to continue to grow in popularity.

VERONICA COONS Great Bend Tribune

High tunnels provide ideal growing conditions for peppers, like this ghost pepper grown by Bruce Swob.

See MARKET, 12

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Farm Bureau – your family’s best investment When you join Farm Bureau, you’re joining an organization of people like you – productive, conscientious citizens dedicated to improving the quality of lives and the lives of those who depend on them.

Like you, they care about feeding their families, educating their children and speaking out on issues of concern. They also care about value.

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Environmental Programs – BCFB sponsors workshops for area farmers to gain knowledge on the best ways to protect our land and improve soil conditions to grow higher yields of commodities.

Safety Education – Farm Safety Day is offered to area high school students, showcasing 4-5 presenters, topics include PTO safety, grain entrapment, texting and driving.

Day at Statehouse – BCFB board members visit with elected officials at Topeka on issues that will affect the agriculture industries for the coming year.

Young Farmers & Ranchers – A conference beginning to mid age farmers to learn new and upcoming trends in the industry. BCFB helps sponsor the Barton Community College Farm Bureau Collegiate.

Women’s Managing the Farm – A conference for ladies to learn more about farming operations. A great workshop for ladies who have inherited farm land.

Kansas Farm Bureau Annual Meeting – Farm Bureau Members attend workshops and vote on resolutions to protect the agriculture industry from laws.

American Farm Bureau Federation Meeting – Farm Bureau members attend the national conference to learn on latest agriculture issues through workshop and educational speakers. They vote to implement national resolutions.

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GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017 •

7

MARKET, from page 6 Stretching the season That’s good for the fledgling group of vendors hoping to capitalize on the locally grown movement. High tunnels were a game changer at the Summer Street Stroll farmers market in 2016, allowing growers who use them to extend the harvest season on both the front and the tail ends. That development prompted registered members to consider moving the opening date up a few weeks to the middle of May in 2017. The ending date may also move back from the last Thursday in August to the middle of September.

For the people of Great Bend, that’s good news because the end result is more options for healthful and nutritious food during the warmer months of the year.

In 2016, two market vendors erected high tunnels through the Environmental Quality Incentives Program (EQIP) (https://www.nrcs.usda.gov/wps/portal/ nrcs/main/national/programs/financial/eqip/) program, which provided reimbursement for at least part if not all of the expense of purchasing the materials for the tunnels, and the labor to build them.

Bruce Swob grows tomatoes, peppers, and an assortment of other vegetables on his farm in rural Albert.

He was the first, building his tunnel in the fall of 2015.

By the time the market opened during Great Bend’s 2016 June Jaunt celebration, he had tomatoes ready to sell. Typically, here in Kansas, growers are beginning to bring tomatoes to market by the beginning of July.

Swob was able to transplant his tomatoes seedlings in the early spring, allowing him to get a sizeable jump on production.

Heartland Farm is a ministry of the Dominican Sisters of Peace located just over the county line in Rush County. It was the second market vendor to build a high tunnel, doing so in the fall of 2015 also. However, high winds damaged the tunnel early on, so production couldn’t start until repairs were made in the spring.

Still, thanks to the efforts of the staff which includes Sister Jane Belanger along with Neville and Paula Edwards and their family, the tunnels provided a means for the farm to enjoy early and increased production.

Their primary goal is to provide produce to the Great Bend Motherhouse, but there was plenty to bring to the farmer’s market too. This allows them also to promote peace through caring for the earth and all the creatures who live here, one of their stated goals and objectives.

After the 2016 market season came to an end, both farms took part in a public tour of their high tunnels, where they shared what they had learned over their first season. Their success has prompted many in the surrounding area to apply to the EQIP program too.

Vendor numbers on the rise As a state registered market, the Summer Street Stroll Farmers Market vendors are automatically covered by liability insurance through the Kansas Department of Agriculture. That’s a big benefit because there’s already a lot of risk as a market gardener, with the unpredictability inherent in farming, regardless of the scale.

Risks include what way and how hard the wind will decide to blow, if enough or too much rain will come, and what and how many insects may want to partake in the

VERONICA COONS Great Bend Tribune

Market gardeners, whether they grow traditionally or in high tunnels, are bring healthy food to local tables.

feast before it makes it to market. Liability insurance can at least make selling that produce a lot less risky.

Rose has already received several inquiries from vendors interested in being added to the 2017 market season, she said. She is excited at the diversity attracted to Great Bend. Bakers, value added food vendors, crafters and artisans, as well as more growers plan to bring their wares to the market this year.

Enhancements at the Courthouse Square, where the Summer Street Stroll Farmers Market is held from 4 - 7 p.m. on Thursday nights at the southeast corner, will provide even more fun for families. Improvements to the Clayton L. Moses Memorial Bandshell will be completed by the time the market opens, and the newly installed splash pad on the north end of the bandshell plaza will provide young people a fun new diversion.

The opening date for the 2017 market has been set for Thursday, May 11.

Keep an eye out for announcements about the Summer Street Stroll Farmers Market facebook page, which will be live soon, and will provide vendors a way to let shoppers know in advance what will be available at the market, along with recipes, preparation tips, and more.

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• GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017

Unconventional path yields unconventional results BCC ag student lands dream job before graduation

N

ews headlines and blog titles are riddled with references to the difficult job market millennials face today.

Many end their four- or five-year stints at universities with mountains of debt, then compete for limited career prospects against countless peers possessing similar credentials.

Cody Tuzicka is among the lucky few to score his dream job, and he did it months before his December 2015 graduation date, with only two years of college.

Tuzicka is serving as a Soil Conservation Technician for the USDA Natural Resource Conservation Service (NRCS) in Larned.

“I don’t think I’ll ever have another job as long as they keep me,” he said.

“I love it. ” As a Soil Conservation Technician, Tuzicka said he works with many producers and farmers on projects to preserve soil, from assisting contractors with building terraces and waterways to ensuring plots of land dedicated to providing habitats for wildlife meet government regulations.

Much of the work is dirty, for which he was prepared with a background in agriculture and farming since he was nine years old, but Tuzicka said good communication is a critical component of his success.

“I learned how to open up to people at Barton,” he said. “I have a lot of personal relationships with producers and can talk on their level of what they know and what I know, and there is a lot of back and forth with producers on the different ways to correct issues in a field. A big thing that helped prepare me was just exposure to more people and working with other students at Barton.”

Some key relationships, he said, were with his instructors.

“My main instructor, Vic Martin, gave me advice on the types of classes I should take to do well in this job,” he said. “He was really accessible. It

could be seven or eight o’clock at night when I would call, and he was always willing to help me, from homework to work on the farm. He was always willing to offer his insight.”

Community college education was not Tuzicka’s first direction. After high school, he tried his luck at a four-year university and was quickly turned off by the size and scope of the courses.

One semester passed before he made the switch to Barton, which he said was a breath of fresh air.

“The class sizes are small and you get a lot of one-on-one time with the instructors,” he said. “In my experience, smaller classes help me get more out of the curriculum and the teachers will stop and explain things to you.”

Tuzicka landed his current job in October of 2015 and finished his associate degree in agriculture business from Barton two months later. He is not one to rest on his laurels indefinitely; he intends to advance in his current position by getting a bachelor’s degree.

“I’m done for at least a year and in the meantime I’m getting my feet wet,” he said.

Agriculture Instructor Vic Martin said Tuzicka’s story is not uncommon for Barton graduates and that success after Barton is defined differently by each student.

“Some of our students find employment and then don’t graduate, which is just fine,” Martin said. “Some come for a two-year degree and wind up transferring to a four year school and earning a bachelor’s degree. Others return to their family farms.”

He said Barton’s agriculture offerings are designed with the intent of supporting the local economy and workforce.

“Our degrees and certifications are tailored to the types of jobs you find in rural Kansas,” he said. “Our goal is to provide local people skills they need to get jobs so they can stay in the area and have a good life.”

COURTESY PHOTO

Soil Conservation Technician for the U.S. Department of Agriculture Cody Tuzicka investigates grass and soil at a Conservation Reserve Program site, which is intended to provide habitat to wildlife.

Learn more at CTE Fair This is the second of four stories to be released by Barton Community College in February in celebration of Career Technical Education (CTE) Month.

CTE month will culminate with a Career Technical Education Fair from 1-3 p.m. March 1 in the Case New Holland Shop in the Northeast side of the Technical building. Registration opens at 12:30 p.m. and optional campus tours start at 10:30 a.m.

The fair is available for 8th grade students, high school students, current Barton students and community members and will feature demonstrations and hands-on-activities. To sign up, contact Denise Schreiber at 620-792-9324 or schreiberd@bartonccc.edu.

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GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017 •

9

Cautious optimism Prices go up and down, but oil remains vital to area

BY DALE HOGG dhogg@gbtribune.com

W

hen oil prices began to drop a couple years back, veterans of the oil patch thought they’d seen this movie before. There had always been a happy ending those crude prices bounced back.

But that has not been the case, said Richard Gunn, an Ellinwood oil producer with Grady Bolding Corporation.

Now, those in the industry feel this may be the new normal.

Even so, “the overall feeling in the oil business I would say is cautious optimism,” Gunn said.

One thing that isn’t changing.

This is an ag-oil region. Black gold has a massive impact on Barton County.

“The oil patch has had a considerable impact on this rural, agricultural region for almost a century,” Gunn said. Barton County is one of the top oil producing counties in Kansas.

“Whether it is a farmer receiving a monthly royalty check or someone employed in the upstream, midstream, or downstream oil and gas sectors, a significant percentage of the residents in this area rely on the oil patch for their income and livelihoods,” he said. It is also no secret that Barton County depends on the revenues collected from ad valorem tax on oil and gas leases, severance tax on production, and sales tax on oil and gas-related equipment and supplies.

“Ironically, each resident of Barton County ends up being affected by the price decline given their taxes are often increased to compensate for the shortfalls,” he said.

DALE HOGG Great Bend Tribune

An oil drilling rig works north of Great Bend last spring. Area oil producers are cautiously optimistic that oil prices could rebound some this year.

Gunn is also a part of the Western Kansas Chapter of the American Petroleum Institute. He took time recently to respond to questions about this industry. His answers are below.

• Oil prices surged some mid last year and drilling increased. However, the spike

was short lived. What is the status of the area oil industry now?

While the oil patch has not returned to its pre-2015 status, the oil price surge mid last year was enough for a small number of producers to resume some of their drilling projects, Gunn

THE LENDING LEADER

said. Accordingly, a small number of drilling crews have gone back to work and rig counts have increased in this state and nationwide over the past several months.

“Drilling activity has been consistent in Kansas these last six months, but, again, no-

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where near the levels when oil prices were higher,” he said.

For example, right now notice of intents for drilling filed with the KCC are at about a sixth of the number they were only few years ago.

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• GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017

OPTIMISM, from page 9

DALE HOGG Great Bend Tribune

“It just does not make economic sense to commit to an aggressive drilling program when the price per barrel is not enough to recoup drilling/completion costs in a reasonable amount of time or even cover lifting costs with existing production in some cases. Most of producers are simply trying to keep their wells functioning as inexpensively as possible with the smallest number of employees.�

The oil and gas industry has had a strong impact on Barton County for a long time and it continues to be one of the top oilproducing counties in Kansas.

• All indications I’ve seen point to prices remaining low. What is the outlook for 2017? “We are hopeful that things will continue to improve in 2017. As I mentioned, the oil price has increased enough to where some drilling projects are financially viable for producers in this region again,â€? Gunn said. “We are a smaller operator/ producer and have plans for several vertical wells to be drilled this year.â€?

Still, they are pursuing a very conservative drilling agenda compared to when to prices were much higher. If the price of oil were to start dropping, these projects would be put on hold again and they would go back to “weathering the storm.�

When the price drop began in 2014, there was a strong belief it would be short-lived and all of the cutbacks would be temporary, he said. “Now that it has been over a year with only marginal improvement, I think we worry now that if the price drops again and/or remains at these levels for the foreseeable future that many of the temporary cutbacks will become permanent.â€? • What could be the Trump effect? “So far I think everyone is still in ‘wait and see’ mode with how the Trump administration will affect things for your average Kansas producer,â€?

Gunn said. The oil patch supported the GOP candidate and hoped that with Trump winning the presidency things would improve for our industry. “Obviously there is concern his actions that affect international policy may end up negating any domestic measures implemented to improve the oil patch,� he said. “However, at this juncture, most of his political appointees who will be involved with energy policy appear pro-petroleum and this bodes well for our industry.�

For example, Trump’s administration questioning EPA reporting, studies and methods has been in the news as of late and could prove helpful. Overregulation has long been an issue for producers in this region, he said.

Federal organizations often take a “one-size fits allâ€? approach with the oil industry and introduce new, burdensome standards that generally do not apply to smaller producers. • Any other thoughts? “It has always been surprising to me that when oil prices plummet to these levels there are few countermeasures in place to protect small-tomid-sized, independent producers,â€? he said. It is especially surprising considering the impact of the oil patch on this region and the amount of assistance the agricultural industry receives under similar circumstances.

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s president of the Kansas Independent Oil and Gas Association, Edward Cross has given several presentations to Kansas legislative committees in recent weeks on the state of the oil and gas industry. “I told them that many Kansas oil and gas producers are refocusing capital expenditures and strategizing their way out of this downturn,� he said.

These companies are optimizing operating costs to become more efficient and specialized. “Many Kansas producers are focusing on the most resilient short-cycle projects and concentrating on their core competencies and smaller producer advantages,� he said. “When looking at the macro level, we see the world’s major oil companies appear to be back in acquisition mode, targeting smaller exploration and production firms to boost their oil and natural gas reserves,� he said. Since late November, major

oil companies have announced 11 deals worth more than $500 million each with a combined value of $31 billion. “To me this is a clear sign that many major oil companies are more confident a recovery is under way, But for Kansas producers, I would characterize them as cautiously optimistic and hoping that planned OPEC and non-OPEC production cuts stabilize the market and balance the global supply/demand equation.�

But, it is also about the small, independent who produce 90 percent of the oil and 63 percent of the natural gas in Kansas, he said. “Oil and natural gas are an integral part of our society.

Much of our high standard of living can be traced to the use of petroleum. The Kansas oil and natural gas industry fuels America, helps the Kansas economy, and makes positive contributions to our way of life.�

The outlook These are critical times for the Kansas oil and natural gas industry, economically and politically, Cross said. “The challenges we face grow in number and complexity are exacerbated by a low oil and

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natural gas price environment.

The advocacy efforts of the Kansas Independent Oil & Gas Association (KIOGA) have only gotten more urgent.�

While the drastic drops in the price of oil since mid-2014 have led to some restructuring in the oil industry, this is not the long-term story or trend for the industry. KIOGA has compiled statistics that paint a remarkable picture of the oil and natural gas industry’s impact on the Kansas economy and the level of state taxes imposed on the industry.

KIOGA has prepared several white papers and reports that provide a summary of the current state of the oil and natural gas industry. “These informational pieces highlight how oil and natural gas uniquely impacts many aspects of our life,� Cross said. “Whether it is providing well-paying jobs, saving consumers thousands of dollars each year on their energy bills, producing the building blocks for products we use every day, or developing innovations that have reduced air emissions to historic lows, the oil and natural gas industry is a vital part of the Kansas and U.S. economy.�

See NUMBERS, 11

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GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017 •

11

COURTESY PHOTO

A report the Kansas Independent Oil and Gas Association shows that the oil and natural gas industry is a key contributor to the Kansas economy.

NUMBERS, from page 10

VOICE OF THE KANSAS INDEPENDENT PETROLEUM INDUSTRY

Kansas industry activity Oil and natural gas activity in Kansas was down significantly in 2016. The Kansas oil and natural gas industry produced nearly 39 million barrels of oil and 235 billion cubic feet of natural gas in 2016. Over 78 of the value of the Kansas oil and natural gas industry comes from oil production and 22 comes from natural gas production. The industry saw 20-40 drilling rigs running most of the year (a 78 drop from 2014). The KCC reports 1,166 drilling permits were issued in 2016 (an 83 drop from 2014).

Kansas oil production fell by 14.25 in 2016 which followed an 8.1 drop in 2015.

Kansas oil production has dropped by 21 since 2014. Interestingly, while the average oil well in Kansas produces 2.63 barrels per day, the industry supports 118,000 jobs, $3 billion in family income, and pay $1.4 billion and state and local taxes.

Kansas oil and gas industry strategic analysis KIOGA has prepared a report on the oil and natural gas industry’s impact on the economic vitality of Kansas and the level of state taxes imposed on the industry. The report shows that the oil and natural gas industry is a key contributor to the Kansas economy.

After many decades of productive

stewardship, oil and natural gas resources continue to play an important part of the livelihoods of Kansans throughout the state. The Kansas oil and natural gas industry is a critical part of the Kansas economy. The Kansas oil and natural gas industry is over a $1.8 billion industry that puts tens of thousands of people all across Kansas to work each day and pumps hundreds of millions of dollars into the state’s economy each year; money that helps support families, fund schools, and build roads. The Kansas Geological Society, in association with the Kansas Corporation Commission and the Kansas Geological Survey, named 36 new oil and gas fields in Kansas in 2016. The Kansas oil and natural gas industry is a vital element of the Kansas economy today and will be a critical part of the economy going forward.

KIOGA put together its annual Kansas Oil & Gas Industry Strategic Analysis study to highlight the importance of the oil and gas industry in Kansas.

Some of the key findings include: • Crude oil prices dropped by more than 60 percent from mid-2014 through 2016.

• Kansas lost over $730 million in oil and gas output since 2014.

• Royalty payments dropped by over $400 million across Kansas in 2016.

• Family income dropped by $341

million across Kansas in 2016.

• Severance tax collections on oil and natural gas production decreased by 40 in 2016 and are down by 75 since 2014.

• Ad Valorem taxes collections on oil and natural gas decreased by 41 in 2016 and are down by 69 since 2014.

• More than $110 million in severance and ad valorem taxes was paid by the oil and natural gas industry during the last year, making the oil and gas industry one of the most heavily taxed industries in Kansas, as over 12.4 of the value of oil and natural gas produced is paid in taxes.

And that doesn’t include sales taxes, income taxes, or the taxes imposed on final products.

• The Kansas oil and gas industry pays taxes not just once, but multiple

times before the oil and natural gas reached its final destination. Taxes are imposed on oil and natural gas while still in the ground, then again when they are produced, when transported, when refined, and again when sold as final products. Plus the Kansas oil and gas industry is subject to all other general business, and income taxes that other businesses pay. These taxes reduce the rates of return on new exploration and production investments by an average of 26.5 .

• In areas where oil and natural gas are found, the industry represents a quarter of the jobs in some counties and 60 to 70 of the property tax.

• Sales of oilfield services are down by more than 60 percent since 2014.

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• GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017

Oil industry recovery predicted

DALE HOGG Great Bend Tribune

The North American upstream oil and gas industry could make a comeback, a popular trade magazine popular is reporting.

Data indicates things looking up

BY STAFF REPORTS

H

OUSTON – The North American upstream oil and gas industry is set to stage a comeback, according to new data presented by World Oil, a trade magazine for the global upstream industry.

According to proprietary survey data—gathered from U.S. operators, U.S. state agencies and international petroleum ministries/departments— World Oil forecasts the following for 2017: • U.S. drilling will jump 26.8 percent higher, to 18,552 wells • U.S. footage will increase 29.8 percent, to 151.5

MMft of hole. • U.S. Gulf of Mexico E&P activity, focused on deepwater projects, will go up approximately 9.4 percent, with increasing well depths and footage. • Canadian activity will begin to improve, gaining 21.6 percent to 4,212 wells. • Global drilling, including Canada, should increase moderately to 39,742 wells, for a 6.1 percent pick-up. • Global offshore drilling, reflecting stagnant capital expenditures outside North America, will only increase 1.4 percent, to 2,604 wells (including the Gulf of Mexico).

Kurt Abraham, World Oil’s editor and chief forecaster, noted that U.S. production—which averaged 8.9 million barrels of oil per day in the fourth quarter, up from 8.7

MMbopd in the third quarter—appears to be on the rise. However, he warned, North America may have to continue in its new role as swing producer, and thus may be required to remain flexible.

Kansas. Wells drilled in Kansas, overall, will be up 5.0, percent at 1,374 wells, as opposed to 1,309 in 2016. This compares to about 3,700 in 2015, and 5,700 in 2014, which was the last good year of activity that the industry has had. World Oil also forecast that 4.1 million feet of hole will be drilled in Kansas during 2017, up 14.2 percent from 2016’s figure of 3.56 million feet.

See DATA, 13

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13

COURTESY PHOTO

A recent survey shows an oil industry recover may be in the offing.

DATA, from page 12 They believe that roughly 95 percent or more of the wells will target oil, as opposed to natural gas. Only about 10 percent of the wells will be for exploration, while the remainder will be for development in existing fields.

In its survey group, which represents about 15 percent of Kansas’ activity, the increase is about 10 percent, which is somewhat more than our statewide figure, but we have learned from experience that the survey groups are almost always more optimistic than the statewide total.

Texas. Drilling in the Lone Star State will rise 26.4 percent, with double-digit increases expected for all 12 of the Railroad Commission districts. While the gains are being led by the Permian basin, with some additional recovery in the Eagle Ford, there is also significant improvement underway in conventional activity.

Permian basin. In 2016, operators drilled 3,198 wells in Railroad Commission Districts 8 and 7C, more than originally anticipated. For 2017, World Oil expects to see 3,999 wells drilled

in these districts. For 2017, the industry projects a 10 percent increase in average lateral length for the Permian.

Eagle Ford. In the Eagle Ford’s predominantly oil portion, concentrated in District 1, activity should increase 28.3 percent. World Oil predicts that operators will drill 802 wells with an average TD of 14,250 ft. In the gas-heavy Railroad Commission District 2, operators have said they plan to drill 638 wells to an average TD of 15,400 ft, a gain of 23.9 percent.

Activity in District 4 is also forecast to increase 19.1 percent.

Gulf of Mexico. Activity has been at historically low levels in the Gulf over the last several years, and 2016 was the lowest yet, with just 117 wells tallied. However, a core of deepwater development activity has continued, and it will continue to form the bulk of work in the Gulf. World Oil projects that drilling will increase about 9 percent, to 128 wells.

Oklahoma. During 2017, drilling in the state, home to the emerging SCOOP and STACK plays, is expected to increase 38.5

percent overall, with 1,809 wells scheduled for an average TD of around 11,600 ft.

Even though SCOOP and STACK wells are expensive to drill, they can offer a reasonable rate of return in the current oil price environment.

North Dakota. Based on figures from state officials and a proprietary survey of operators, World Oil forecasts that drilling in North Dakota will jump 37.9 percent higher, to total 925 wells in 2017, accounting for 18.7 MMft of hole. Average well depth, including lateral sections, will be approximately 20,250 ft.

Louisiana. Drilling in the northern half of the state is expected to be up a stout 31.2 percent, as the Haynesville shale (gas play) shows signs of life, and smaller operators drill shallow oil wells. Meanwhile, in the state’s southern half, featuring conventional oil and deep gas wells, activity is recovering at a more measured pace. Wells drilled are forecast to increase 12.8 percent, to 123.

Northeastern states. The region remains dominated by the Marcellus and Utica shales. In Pennsylvania, operators

plan to drill 774 wells for a 29 percent increase. In Ohio, drilling should increase 19.1 percent, to 380 wells. And in neighboring West Virginia, gastargeted activity is on the rebound, with about half of the wells in the Marcellus.

Total wells should reach 245, up 21.9 percent.

Rocky Mountain states. As operators boost drilling in the prolific Niobrara shale, particularly in the DJ basin, Colorado will see its wells drilled rise 34.0 percent, to 1,012 wells. New Mexico should see its wells drilled total 710, for an impressive 40.6 percent increase, thanks to heavy activity in its portion of the Permian, as well as renewed activity in the San Juan basin, in the northwest.

California/Alaska. Drilling in California, the bulk of which is accounted for by just four firms, is expected to improve about 30 percent, to 892 wells, most of it shallow oil development activity.

Meanwhile, in Alaska, drilling is forecast to increase 16.1 percent, to 173 wells, including six offshore in the Cook Inlet.

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Danielle Feist

Danielle Feist is a Wichita native that began her career in the museum and zoo ďŹ elds seventeen years ago as an educator at the Topeka Zoo. She has had many responsibilities as an educator, exhibits specialist, volunteer coordinator, and special events coordinator. Her passion for education and volunteerism continued after moving to Great Bend, consulting with the Coronado Quivera Museum in Lyons in research and education projects.

Danielle graduated from California State University, Hayward receiving a master of arts in anthropology. She is excited to share our local Oil & Gas history and heritage in her role as curator. She currently lives in Great Bend with her husband, Chris, and their chocolate lab, Tess.

We are booking K-12 ďŹ eld trips and outreach prgrams for the Spring of 2017

Open Monday-Friday 1-5 p.m. April through September 5PVST 8FMDPNF t "MXBZT PQFO CZ BQQPJOUNFOU $BMM The Kansas Oil & Gas Hall of Fame and Museum strives to collect and preserve the cultural heritage of the local oil and gas industry and interpret its history through innovative, educational experiences for the present and future generations.

Night or Day 620-792-7301 1-800-428-1445

Ron “Smitty� Smith Darrell Mitchell Chris Smith

christophersmith@smithsupplyllc.com

300 Patton Rd., Great Bend, KS 67530

Did You Know?

The Biggs Conference Room is available for rentals of all types, from educational programs, corporate meetings, showers, birthdays, and more! Call the Museum to check availability and costs today!

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14

• GREAT BEND (KAN.) TRIBUNE • SUNDAY, FEBRUARY 12, 2017

New focus and mission for the Kansas Oil and Gas Museum

BY RUSSELL EDEM

O

ver the past year, people of Barton County may have witnessed some changes at the Kansas Gas and Oil Museum and seen the new direction it has taken by providing a richer experience for the community.

This new direction came about with the coordination of the museum curator Danielle Feist and the Board of Directors after they determined that there should be a new focus and mission within the museum. “These changes focus less on collecting objects for display, and more on how we tell the stories of the men and women that shaped the local industry,� Feist said. “We will continue to use the collection to develop these amazing stories of Kansas science and history and this will allow the museum to grow as a historical, cultural and scientific entity.�

The museum curator is developing and applying history and science programs adapted to Kansas State Education Standards for local school districts.

Museum-sponsored programs, such as summer science camps, youth drop-in programs and adult learning opportunities will allow the general public to gain this invaluable knowledge as well. “We are very excited about these changes,� Feist said. “We will be able to get the community more involved with the museum and share the rich history of the oil and gas industry that helped shape Barton County.�

One of the changes is the summer science camps and youth drop-in programs that the museum started last summer as it began to turn the corner with the new direction.

The Museum hosted a two-week summer camp for local children where they got the chance to learn about the oil and gas industry and

how it has played an important role throughout the surrounding communities. “The kids really enjoyed the camp,� Feist said. “Five of them have never been to a museum, so they where very excited about participating in the camp.�

The children were able to explore how oil and gas play a part in their daily lives, they learned about geology and how it plays a part in oil and gas drilling and they had the opportunity to explore the exhibits at the museum.

People can expect to see physical changes coming as they begin the process of remodeling the Hall of Fame building and other exhibits in the museum.

The museum will bring in new elements to the current exhibits, including updated informational signs, display cases and interactives for kids and adults of all ages. “The museum has a unique opportunity to tell the stories of the people that helped shape our community and in order for us to enhance and share these stories, we need your assistance,� Feist said.

There are several ways to get involved with the museum. People can donate funds for programs or events, volunteer their time, or donate objects. “Without objects it is difficult to tell the story to future generations about our community, culture and history,� Feist said. “Your donations and contributions will help us meet our mission of service to the community. History was made by those who made a difference.�

The museum’s goal is to provide educational information about present industry activities, to preserve the past history of the oil and gas industry in Great Bend and surrounding areas, and to honor those who have dedicated their lives to the industry, she said.

For more information about the camp or to make a donation contact Feist at 620-617-8335.

COURTESY PHOTOS

Students from Ellinwood Grade School participate in a pilot outreach program last summer. The program taught the students how oil and gas was used in the ancient world.

Local children search for fossils during summer camp that was hosted by the Kansas Oil and Gas Museum. Students had the opportunity to learn about geology and how it plays a part in oil drilling.

“Single Source Solutions�

Fuller Industries continues to manufacture a complete line of brooms, brushes, mops, cleaning chemicals and other personal care products. In addition, it aggressively pursues selling the excess manufacturing capacity and capabilities of this diverse facility to produce private labeled products for other regional and national companies with established distribution already in place. Fuller Industries plans to take advantage of the “Made in America� movement growing in popularity once again in this country.

Fuller Industries is a manufacturing plant for hire. This past year has been good for the company. It’s a good story to tell – it is one of employees, management and an entire community bonding together to keep a local business local. The goal now is to grow markets and expand the company’s client/customer base in 2017.

Industries LLC

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One Fuller Way | Great Bend, Kansas 67530