Basin Resources Winter 2016

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Winter 2016

content Celebrating 95 years of oil and gas produCtion

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Don Vaughan puBliSHER

Cindy Cowan Thiele EDiTOR

Dorothy Nobis Debra Mayeux CONTRiBuTiNG WRiTERS

Josh Bishop Curtis Ray Benally CONTRiBuTiNG pHOTOGRApHERS

Suzanne Thurman

blM oKs final rule to Curb Venting

sylVia little

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DESiGNER

Clint Alexander Tonya Daniell SAlES STAFF

lacey Waite ADMiNiSTRATiON

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Conoco selling local assets Column 2016 election momentous for energy

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solar farm farmington studies feasibility of alternate energy option

18 general electric oil gas oil and gas industry donates time, money and baker Hughes merge Column

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Majestic Media 100 W. Apache St. Farmington, NM 87401 505-516-1230 www.majesticmediausa.com Basin Resources magazine is published four times a year by Majestic Media. Material herein may not be reprinted without expressed written consent of the publisher. Opinions expressed by the contributing writers are not necessarily those of the publisher, editor or Basin Resources magazine. Every effort has been made to ensure the accuracy of this publication. However the publisher cannot assume responsibility for errors or omissions. Š 2016 Basin Resources magazine.

www.basinresourcesusa.com • Winter 2016

6 BASIN RESOURCES

ConocoPhillips selling local assets Debra Mayeux Basin Resources One of San Juan County’s largest oil and gas employers, with a 50-year history in the basin, has announced it will liquidate its local assets over the next two years.

In a Nov. 10 meeting with its analysts and investors, ConocoPhillips announced a $5 to $8 billion asset divestiture program.

“These will be primarily North american gas assets,” ConocoPhillips Spokeswoman Davy Kong said in an emailed statement.

These asset sales are planned over the next two years, and include the San Juan basin, where the company employs 500 people and is the largest operator, with thousands of wells.

“During the past two years, we have significantly transformed ConocoPhillips to succeed in a lower, more volatile price environment. We’ve lowered the capital intensity and breakeven price of the company, lowered the cost of supply of our investment portfolio, and created strategic flexibility for future price cycles,” Chairman and CeO ryan Lance said at the meeting.

“We believe our plan offers a differentiated strategy within the e&P sector that is focused on free cash flow generation and improving returns to shareholders. We have positioned ConocoPhillips to deliver double-digit shareholder returns across a range of commodity prices through a combination of peer-leading shareholder distributions and high-return investments.”

The other aspects of the plan include a $3 billion share repurchase program and providing 2017 operating plan guidance, including expected capital expenditures of $5 billion, which is a decrease of 4 percent compared with 2016 guidance of $5.2 billion and more than 50 percent lower than 2015 capital expenditures and investments of $10.1 billion.

The company stated in a press release that spending in 2017, will focus on “flexible unconventional development programs in the Lower 48, conventional projects in europe, asia Pacific and alaska, and base asset maintenance. approximately $0.6 billion is included for exploration, which is primarily focused on unconventionals, appraisal of the barossa discovery, and the closeout of deepwater Gulf of Mexico and Nova Scotia drilling obligations.”

While Lance stated at the meeting that the company’s goal is to reduce debt and have a 20 to 30 percent payout of operating cash flow to shareholders, the details of the asset divestiture were limited in its press releases.

Kong said, “We have shared further details about the marketing process with our employees. as we told them, we expect to market several assets, but will only consider offers that recognize their full value. We will not provide further specifics on an asset-by asset basis."

This restructuring was in response to a third-quarter loss of $1.04 billion.

“In setting out these priorities, our goal is to have strong resilience to low commodity prices with the ability to capture upside during periods of higher prices,” Lance said.

Full-year 2017 production is expected to be 1,540 to 1,570 thousand barrels of oil equivalent per day, which results in flat to 2

percent growth compared with expected full-year 2016 production of approximately 1,540 thousand barrels of oil equivalent per day when adjusted for 2016 expected dispositions. Growth is expected to come primarily from ramp up at aPLNG in australia, Surmont 2 in Canada and Kebabangan in Malaysia, as well as increased activity in the Lower 48 unconventionals, partly offset by normal field decline. The company’s production outlook excludes Libya, according to a press release.

The company continues to achieve cost reductions across the business. Guidance for 2017 production and operating expenses is approximately $5.2 billion, which results in adjusted operating cost guidance of $6 billion, a 9 percent improvement compared with 2016 adjusted operating cost guidance.

“We believe our company offers one of the most unique value propositions in the e&P sector,” Lance said. “We’ve reset virtually every aspect of the business – our capital program, our cost structure and our portfolio – during the recent industry downturn. Now, we’re in a differential position to generate free cash flow as prices recover and we implement our clear priorities for allocating available cash. In a future of volatile prices, we can demonstrate that our disciplined returns-focused approach will deliver strong performance for all our stakeholders.”

www.basinresourcesusa.com • WINTER 2016

8 BASIN RESOURCES

Back row from L: Steve Dunn, Steve Henke, Dave Simmons, Jeanine Springer (for Joe Salmon), T. Greg Merrion, Kurt Fagrelius Front row from L: Rony Simmons, Richard Peterson, John Alexander, Neil Tefteller, Shayleen Mitchen and Tom Brown (for Earl Brown)

Photo by Rodney Seale

Celebrating 95 years of oil and gas production Debra Mayeux Basin Resources The Desk and Derrick Club of Farmington celebrated 95 years of oil and gas production in the San Juan basin at its annual industry appreciation banquet Oct. 20.

During the event, the club recognized 12 industry leaders for their dedication to the extractive industries.

With a motto of “Greater knowledge – greater service,” the Desk and Derrick Club was founded in 1949 by Inez awty

Schaeffer, an employee at Humble Oil and refining in New Orleans, La. Seventythree women attended the first meeting, and all had the desire to learn more about the oil and gas industry. From there, three more clubs were formed in Jackson, Miss., Los angeles, Calif., and Houston, Texas, and by 1951, the four clubs formed the association of Desk and Derrick Clubs of North america. The Farmington chapter was chartered in 1957 with 32 members, and that membership is now at 39.

The members meet each year and select

movers and shakers in the industry for recognition and this year they selected 10 to be honored and two be recognized posthumously. Those honored were Neil Tefteller, John alexander, rony Simmons, Dave Simmons, Steve Dunn, Kurt Fagrelius, richard “Corky” Peterson, Steve Henke, Jerry Long, T. Greg Merrion, the late earl brown and the late Joe C. Salmon.

Neil Tefteller Tefteller was born in Texas in 1928 and

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BASIN RESOURCES 9 attended San Angelo College, now Angelo State University, where he studied agriculture. He first came to Farmington in 1956 to work for Carter Oil, based in the Paradox Basin of Aneth, Utah. He provided reservoir pressure transient testing and data analysis, and moved his family to the area two years later to open a permanent office.

The company later became known as Tefteller Inc., and was started in partnership with Neil and his brother Farrest Tefteller and their business partner Dennis Owen. The brothers ended up buying out Owen and created a family-owned business based in Midland, Texas, working in the Permian Basin.

Neil continued to operate the Farmington office, working oil and gas play throughout the Rocky Mountain region where he performed reservoir pressure transient testing and data analysis. Neil’s work took him across the western U.S. and into Canada, and on the local front he worked on the discovery well in the northwest Lisbon Field in Utah as well as the San Juan Basin fields.

Neil and his wife, Billie, have been married 68 years. They have one daughter and one granddaughter. Neil’s son, Toby, ran his Grand Junction, Colo., office until his death in 2012. Neil is still active in the day-to-day operations of the company.

John Alexander John Alexander moved to Farmington from Rankin, Texas, in 1972 when he was

transferred by Halliburton. A 1968 graduate of the University of Texas, he worked for Amoco Production as a facility engineer before working for Halliburton. From 1972 to 1976, as a district manager.

Alexander then became a consultant with 3E Company from 1976 to 1986. In 1986, he went to work for Chuska Energy until 1989 when he left to begin work as a production engineer at Dugan Production Corp., where in 1996 he was promoted to vice president. Alexander is responsible for the day-to-day operations at Dugan and is proud that the company has not had to lay off employees, or cut salaries or benefits in the economic downturn. They operate the same whether prices are high or low.

John has been married to Candy since 1969. The couple has two children, Bob and Jennifer, and five grandchildren.

Rony Simmons Rony Eugene Simmons came to Farmington 1957 to work for BJ Services at the perforating truck operator. He moved to the area from Newton, Miss. Simmons said he worked Shell’s drilling program in the Bisti and remembers many bath nights in the San Juan River. Ten years after going to work for BJ Services the company was sold to Hughes Drilling, and Simmons left in 1968 to start Blue Jet with Jim Kleinegger. He worked there until deciding to retire for one year in 1998, during which time he enjoyed fly fishing on the San Juan River.

In 1999, Simmons decided to return to

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work as a salesman for Tober Slickline, D.J. Simmons, Blue Jet, and Phoenix Services.

He recently decided to retire again and now stays at home with Margaret, his wife of 63 years. They have three children, 24 grandchildren and one great-grandchild.

Dave Simmons Dave Simmons was born in 1949 in Richlands, Va., where his father was a coal miner. Simmons’ father died in 1957, and the family moved to Mount Vernon, where Simmons was the senior class president, graduating in 1967. He graduated with a bachelor of science degree in petroleum engineering in 1971 from Marietta College, and earned his masters in petroleum engineering from Louisiana State University in 1973, after which he went to work for Tenneco drilling wells in Wyoming, Haspah and the San Juan Basin.

In Dec.ember 1974, Simmons began work for Coors as their first petroleum engineer, responsible for 50 wells in the DJ Basin. These wells supplied natural gas to Coor’s ceramic plant in Golden, Colo. A year later, Simmons moved to Farmington and began working for Forrest Wood at NWPL. In 1975, when Simmons moved to Farmington, he stayed for two years and then joined Big A Well Service, owned by George Coleman. He stayed with Coleman until 1981, when he ventured out on his own to open Simmons Consulting and Silver Star Swabbing, which he owned with his brother and a family friend, Dave

10 BASIN RESOURCES Roberts. As a consultant, Simmons provided services throughout the San Juan Basin and in Arizona, Colorado and Texas. By 2000, Silver Star had 11 units and did a majority of its work plugging wells.

In 1984, Simmons formed a new company, San Juan Energy Resources in partnership with Wayne Townsend. Through this company they worked on the development of coal gas for Burlington Resources, Yates Petroleum, and W.B. Hamilton out of

Wichita Falls, Texas.

Simmons retired from Silver Star in 2011, but his wife, Janet, and son Rick continued to work the business until mid-2016, when Silver Star closed, because of the depressed oil and gas industry.

The Simmons have four children and 11 grandchildren.

Steve Dunn Steve Dunn moved to Farmington in 1953 and is the retired drilling and production manager for Merrion Oil and Gas. It was a position he had for nearly 34 years, working for three generations of Merrions. Dunn has a bachelor’s degree in petroleum engineering form the Colorado School of Mines and a master’s degree in business from New Mexico State University. He has extensive experience in the oil and gas industry, but also has been active in dealing with water issues and economic development in the Four Corners region.

Dunn was in the first graduating class of Leadership San Juan.

He has been married for 40 years and has two daughters and five grandchildren.

Kurt Fagrelius Kurt Fagrelius moved to Farmington in 1977, after graduating from Fort Lewis College in Durango, Colo., with a bachelor of science degree in geology. He went to work for Dugan Production, and three years later returned to college at the New Mexico Mining Institute to earn a master’s degree in geology.

By 1982, Fagrelius was back at Dugan Production working as a roustabout and doing well site geology. He has sat on hundreds of wells to examine drill cuttings, cores and record well log data used to complete the well and create subsurface geology maps, and to evaluate potential oil and gas zones for future drilling operations.

Fargelius worked on the development of conventional gas production in the Pictured Cliffs and Dakota Sandstone in the late

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BASIN RESOURCES 11 1970s and early 1980s, and in the mid 1980s. Until recently, Dugan Production’s focus was on drilling Fruitland coal gas wells. When gas prices plummeted, however, the focus shifted to developing oil production from the Gallup Sandstone interval.

Fagrelius is the vice president of land and exploration for Dugan Production. He oversees the land department and is responsible for developing future drilling and completion programs. He also works on the regulatory approvals for drilling applications and rights of ways.

Fargelius is married to Maryann Bush and they have two children, Lindsay and Jake.

Richard Peterson Richard “Corky” Peterson moved to Farmington in 1953 to work as a roughneck for El Paso Natural Gas Company, but he was drafted into the Army in 1955.

He served one year and went to Vernal, Utah, where he roughnecked for KerrMcGee. By 1958, Peterson returned to Farmington to work as a rig manager and tool pusher for Lee McKinney. This involved cleaning out shot holes, running liners and starting some of the first frac jobs.

McKinney sold the rigs in 1960, but Peterson stayed on, working for Signal Drilling Company until 1961. Then, he went to work for S.S. Reames as a rig manager and tool pusher, working on cementing up shot holes, directional drilling to the Dakota Formation and making dual wells.

Reames sold his rigs to Aztec Well Service in 1968, so Peterson began working for the Sandels as rig manager and tool pusher. He was promoted in 1972 to rig supervisor after starting the company’s drilling department and was promoted to Rig Supervisor in 1972.

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During his tenure at Aztec Well Service, Peterson worked on the Drilling Investment Reduction Team, or DIRT, an alliance between Aztec Well Service, Halliburton and Amoco Production. The company also was recognized in the Land Rig Newsletter as being No. 1 in the lower 48 for safety, technology and performance by a private company with ten rigs or less.

Peterson was involved with the drilling and completion of coal wells, cavitation, horizontal and various multiple formation gas and water wells in the San Juan Basin; Montezuma Creek, Utah; Dove Creek, Colo., Hobbs, Gallup, Wagon Mound and Clayton in New Mexico, and Reno., and Elko, in Nevada. He was involved with Halliburton in the experiment to drill from top to bottom using coil tubing, and Aztec Well Service was the first drilling company to use a closed-loop system.

* Celebrating 95 Years 30

12 BASIN RESOURCES

2016 election momentous for energy

Energy industry, national picture looking better politically despite continued low prices

The outcome of the 2016 elections was a shock to many in the media and on the leftwing of the political spectrum. Many simply assumed that Donald Trump could not and would not possibly be elected to the highest office in the Nation.

And, while folks in the energy industry may not be rioting in the streets, the 2016 election – both national and state – will have tremendous repercussions (some of them potentially negative) for the energy industry as a whole, in New Mexico, and in the San Juan Basin.

Let’s start at the top. How will Donald Trump’s victory and Republican control of Congress impact energy policy? While many of Trump’s policies are unclear or even contradictory, he seems to have a clear and aggressive pro-energy vision for the Country.

Across the board, Trump has vowed to cancel the Paris Climate Agreement, abandon the Obama Administration’s Clean Power Plan, end subsidies for wind and solar, repeal regulations, and lift moratoriums on energy development on federal lands.

His aggressive stance on energy was nicely summarized by Marita Noon of the pro-energy Citizens Alliance for Responsible Energy in a July 2016 column that said Trump would “Make America’s Energy Policy Cheaper, Faster, and Better.” Perhaps an even better “summary” is Trump’s placement of Myron Ebell at the head of his Administration’s EPA transition team.

Ebell is Director of the Center for Energy and Environment at the Competitive Enterprise Institute (CEI) and Chairman of the “Cooler Heads Coalition.” CEI and Ebell are described in the media as a “climate skeptics.” The organization was at the center of

Paul gessing President rio grande foundation

Democrats’ “web of denial” attacks on groups that either disagree with the theory of human-caused climate change or don’t see government regulations such as carbon taxes or “cap and trade” as reasonable approaches to the issues.

All of this means that national energy policy is likely to be as “pro-energy” as it has been in a very long time.

In a sense, this should all be very good for New Mexico and the Four Corners. With so much federally-owned land, a more cooperative federal government should be helpful to the energy industry and overall New Mexico economies.

There are a few caveats to that: The Trans Pacific Partnership (TPP) is dead. Had it been adopted, the trade

agreement could have boosted natural gas exports from the United States to Asia, especially Japan. This would likely have been a boon for New Mexico producers. Hillary Clinton had come out against TPP as well, but it is much harder to see President Trump changing positions given his repeated skeptical statements on trade. TPP and its potential for increasing demand for American natural gas were a long-term proposition. That horizon now moves out at least four years.

Efforts to impose quotas on oil and gas imports may receive a boost. Although Trump made no statements during his campaign about the Panhandle Import Reduction Initiative, his “America First” energy policy and skepticism of free trade may lead him to view oil import quotas sympathetically.

Trump was supported by most of the major energy producing states (California, New Mexico, and Colorado being exceptions). If prices remain low or fall even lower, President Trump may be willing to start a trade war on behalf of oil producers.

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BASIN RESOURCES 13 Trade wars tend to have negative repercussions for overall economic growth, but there are simply too many variables to make further predictions.

Trump’s tax-cutting and deregulatory policies could lead to faster economic growth than we have seen throughout the Obama years. This would lead to greater energy consumption, although plentiful supplies may mean lower prices at higher volumes.

New Mexico While much of this column has focused on federal issues and policies, it is at the State level here in New Mexico where things get interesting for the oil and gas industries. Gov. Martinez is now a “lame duck” with only two more years to go. After two short years of Republican control of the House, Democrats defied national headwinds, winning convincing majorities in both houses.

We don’t know who will lead the Democrats, but Rep. Brian Egolf and Sen. Peter Wirth, both of Santa Fe appear to have the inside track to the top slots in their respective caucuses. Santa Fe is a liberal bastion and unlike the defeated Sen. Michael Sanchez, Egolf and Wirth will face few political threats absent a GOP takeover of the Legislature.

Both men have received the highest honor given New Mexico legislators by the anti-oil and gas League of Conservation Voters, but Egolf is widely considered to be the most outspoken opponent of oil and gas in the Legislature. This animus is ironic considering that Brian’s father William made his family quite wealthy primarily in…oil and gas.

For two years the Legislature’s ability to target the oil and gas industry will be limited by Gov. Martinez’s veto pen (she may rival Gary Johnson’s veto totals) given the current makeup of the Legislature. However, the focus has already begun shifting to the 2018 election.

Sen. Tom Udall has made noises about running for governor which would likely push Rep. Michelle Lujan-Grisham to frontrunner status for his Senate seat. Udall will have the inside track in the race for governor and – based on his Washington track record – would be a formidable opponent for traditional energy producers in the State.

The prospect of Tom Udall in the governor’s mansion makes the 2018 battle for the New Mexico House all the more critical.

So, for the energy industry, the national picture is looking much better politically despite continued low prices. For New Mexico, the forecast is cloudy with a chance of crisis.

Paul Gessing is the President of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, non-partisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility

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BLM OKs final rule to curb venting, flaring on federal lands Debra Mayeux Basin Resources The bureau of Land Management stated in January, when it introduced changes to the 30-year-old venting and flaring rules for natural gas well sites, that it wanted to stop wasting the nation’s natural gas supply and cut down on pollutants.

The federal organization was met with opposition and pleas from industry leaders and workers in the San Juan basin. These oil and gas professionals said the change in the rules would have an adverse effect on the industry, which already is in a steep downturn.

Jason Sandel, vice president of aztec Well Service, said at the time that 51 percent of San Juan County’s population felt worse off today Sandel than they did one year ago. “eighty-three percent of residents are worried about the economic downturn,” Sandel said. “This has the potential to cripple a fragile economy.”

Sandel said during a February meeting at San Juan College that “The bLM methane rule has the potential to put us and our employees out of business and on the unemployment line. The impact is that the bLM has tremendous power over our economic future, power to choose winners and losers across our nation by implementing a rule that is selectively enforced based on the owner of the land that a well is placed upon.”

The bLM did not listen to Sandel or to former State representative Tom Taylor (r.-Farmington) and 50 other state legisla-

tors who signed a petition opposing the rule change.

The rule comes down The bLM, instead, made the final rule Nov. 15 to put the new venting and flaring rules into place, stating that it was being done as part of the Interior Department’s “reform agenda to create a cleaner and more sustainable energy future.”

Interior Secretary Sally Jewell stated that this was part of the Obama administration’s Climate action Plan, and that its purpose was to update the 30-year-old regulations on venting and flaring on leased public lands. It also will, according to Jewell, provide a fair return on public resources for federal taxpayers, tribes and states, while also reducing “harmful methane emissions.”

Taylor stated that this idea of methane

emissions being harmful is not based in science. The emissions are equal to 50 parts per billion more than normal.

“It is not a health issue. Here (in the San Juan basin) we have thousands of miles of permeable sandstone outcroppings. every one of those is leaking natural gas and has been for millions of years,” Taylor said in February. “If it’s a health risk at that level, I think this rule should extend to the building codes, because the bathrooms in our houses have hundred of times more methane at certain times of the day. It’s ridiculous.”

Jewell, however, stated that this rule is “good government, plain and simple.”

She believes the rule will help curb climate change and put standards in place that are good for the economy. “Not only will we save more natural gas to power our nation, but we will modernize decades-old

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BASIN RESOURCES 15 standards to keep pace with industry and to ensure a fair return to the American taxpayers for use of a valuable resource that belongs to all of us,” Jewell said.

She and her department believe flaring, which burns off excess natural gas is not only wasteful, but also harmful to the environment. The BLM even believes that 40 percent of the natural gas now vented and flared could be economically captured through available technologies and reused on the market.

“America’s natural gas helps power our economy – it’s a resource, not a waste product, and it’s time we start treating it that way,” BLM Director Neil Kornze said. “With better planning, and today’s affordable technology, we can cut waste in half. This common-sense rule will save enough gas to supply every household in the cities of Dallas and Salt Lake City combined – every year.”

Federal delegation applauds rule The New Mexico Federal Delegation, made up of U.S. Senators Tom Udall and Martin Heinrich and U.S. Representatives Ben Ray Lujan and Michelle Lujan Grisham praised the decision in a combined statement, saying that the final rule will save taxpayer Udall

money and energy resources and reduce harmful emissions by curbing the wasteful venting, flaring and leaks of natural gas.

The delegation stated that the “waste has creHeinrich ated an alarming concentration of methane over the Four Corners region. This dangerous greenhouse gas is at least 25 times more potent than carbon dioxide and a major public health hazard.”

They further stated that the new rules would cut the waste in half and save natural gas to “power the economy.”

The delegation claims Lujan the outdated equipment at oil and gas sites has cost the state $43 million in lost revenues since 2009 and has cost the state’s economy more than $100 million, and they further claim “the additional revenue to invest in schools, roads, bridges and other infrastructure.

And less waste means less smog and healthier people for generations to come.”

However, when oil and gas production is booming in New Mexico the state’s economy benefits greatly with nearly $1 billion going into the general fund and

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$400 to $500 million into the capital outlay fund from oil and gas. There also is a good deal of property and gross receipts tax revenues enjoyed by the state from an active oil and gas industry. Without it, the state’s economy suffers, according to a report from the New Mexico Legislative Finance Committee.

A battle for the courts Even though the new rule was approved only weeks ago, the Western Energy Alliance and the Independent Petroleum Association of American, or IPAA, have filed a lawsuit challenging the regulations. The claim was filed in U.S. District Court in Wyoming, and it states that the BLM rule is an overreach of power that goes beyond the authority granted it by Congress.

In a published report, the two organizations state that oil and gas businesses already comply with air quality regulations, which are mandated by the EPA. The BLM rule duplicates that and conflicts with current EPA regulations.

Rule phased in The rule, which will be phased in over time, requires oil and gas producers to use available technologies and processes to cut flaring in half at oil wells on public and tribal lands. Operators also must periodically inspect their operations for leaks, and replace outdated equipment

16 BASIN RESOURCES that vents large quantities of gas into the air.

Other parts of the rule require operators to limit venting from storage tanks and to use best practices to limit gas losses when removing liquids from wells.

It also restores the government’s congressionally authorized flexibility to set royalty rates at or above 12.5 percent of the value of production. It also moves to cut methane emissions by 35 percent.

“Make no mistake, reducing emissions is in the best interest of our industry,” IPAA Vice-President of Government Relations and Political Affairs Dan Naatz said in a copyrighted story from worldoil.com. “Producers have every incentive to capture and sell as much of their product as possible to consumers, rather than letting it escape in the atmosphere. However, currently, a lack of infrastructure

and gathering lines to collect gas at the wellhead make it difficult for producers to safely transport our product to market.”

Naatz said independent producers have shared their concerns with the Obama Administration; instead the administration has been on a misguided crusade to Keep It in the Ground. “This is an 11th hour shot by an administration that doesn’t fully understand how its rules impact our businesses.

Furthermore, potentially raising royalties on an industry that has been financially hurting is counterintuitive to any business certainty.”

Sgamma Kathleen Sgamma, the vice president of government and

public affairs for the Western Energy Alliance stated in the same story that her organization also supports capturing greater quantities of gas and reducing waste, “but overreaching regulation that fails to acknowledge industry success is not the most effective way to meet those goals,” she said.

“The natural gas industry has delivered a 21-percent reduction in methane emissions since 1990 at the same time as increasing production by 47 percent – all without federal regulation” Sgamma continued. “We don’t need federal rules to tell us to reduce methane emissions, as it’s the very product we’re working so hard to capture and sell. The venting and flaring rule is just as egregious as BLM’s hydraulic fracturing rule, and we’re confident it will similarly be overturned by the courts.”

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18 BASIN RESOURCES

Oil and gas industry donates time, money for the betterment of our community The holidays are upon us and as I sit back and reflect on 2016, I am reminded how fortunate we are to live in San Juan County, N. M. My two terms as a San Juan County Commissioner will come to an end on December 31, and while I am excited about new possibilities that might await me, I am grateful to have had the opportunity to serve the people of San Juan County for the past eight years.

In those eight years, we have enjoyed prosperity and we have been faced with economic challenges.

While the prosperity is more fun and certainly easier to lead, it is the challenges of the current economic downturn that help us grow as a county and as communities.

Trying to navigate the budget process, not just as a San Juan County Commissioner, but also as the Bloomfield Mayor, can be daunting during times of financial crisis. We are forced to look at how we can do more with less – less revenue, less people, less opportunities.

We are also forced to think outside the box and discover ways to help us serve our constituents and maintain the great quality

SCOtt eCKSteiN MayOr City Of BlOOMfield

of life San Juan County and Bloomfield are known for.

It is during the tough times that we are reminded of all that is good about our communities and the Four Corners.

We have good people who will step up to the challenges of being asked to do more with less, who understand that making tough decisions that might cut jobs or services is never easy and that those of us tasked with making those decisions don’t make them without much thought, prayer and conversation with others.

San Juan County has benefitted greatly from the revenues it has received through the oil and gas industry.

Our communities are better because of the generosity of those companies, which have given untold thousands of dollars to help our schools, our youth programs, our special events and our quality of life.

And while the dollars those companies now have to support all that is good about our communities are limited, the oil and gas industry continues to give back, to give often, and to give with gratitude and appreciation for the communities in which they do business.

Scholarships, training, youth sports, youth organizations, non-profits, playgrounds and family events are all sponsored by our friends in the oil and gas industry.

The city of Bloomfield has enjoyed – and much appreciated – the support of companies such as Souder Miller, Envirotech, Halo, Adobe Contractors, ConocoPhillips, Wagner Equipment, Bohannan Huston, High Desert Safety, R&L Chart Services, Adobe Contractors, Largo Tank, San Juan Regional Medical Center, SunRay Park and Casino and San Juan County, all of which provide donations to help the city’s Olde Tyme Fireworks display on July 5 every year.

There are few businesses in San Juan County that haven’t enjoyed the financial benefits of a robust oil and gas industry over the years, and we are all grateful to all of them. And while many of our oil and

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BASIN RESOURCES 19 gas service and industry partners are facing the same economic challenges we do, they continue to provide financial support for the good of our communities and our county.

But it isn’t just the companies that make the oil and gas industry important to us. It is the people who work for those companies who are inspired to continue the trend of giving back. Those employees volunteer their time, their talent and their own financial resources to those in need.

A good example of that is George Archuleta, an operations manager for APlus Well Servicing.

While returning to town after spending the day in the field, George noticed a dog running in front of his truck. The dog was thin and appeared to be disoriented, so George stopped, called the dog to him, and put the dog in the back of his truck.

George drove into Bloomfield and

stopped at Famers Market, where he purchased food for the hungry dog before taking the dog to the animal shelter.

George decided not to leave the dog at the shelter (not because he doubted the dog would be well cared for, but because – as happens – he had bonded with the dog) and took it home with him.

Using social media, George posted about the dog and got a quick response. A family, who identified the dog correctly, said the dog became frightened by the fireworks display at a local football game and ran away. The dog had been gone for some time and the family had all but given up hope of ever finding it.

Freshly shampooed by George and his family, the dog was returned to his family, and everyone, including George, enjoyed that happy ending.

George’s story is inspiring, but not surprising. Our oilfield – and all of our busi-

nesses in San Juan County – is blessed with people just like George. Helping others – be they two-legged or four-legged! – is not just something they do, but it is the right thing they do.

So, as we make our lists and check them twice this Christmas season, let us all make a list of the reasons we choose to live in San Juan County.

The weather, the quality of life, the focus on family – and the people – are what make this the best place to call home.

I appreciate the opportunity to have served the residents of San Juan County for the past eight years and I look forward to continuing to serve the residents of Bloomfield for many more years to come.

The support of our business community, our elected officials, and those who take our vision and make it a reality, is a gift and I am grateful to all of you.

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20 BASIN RESOURCES

Solar farm Farmington studies feasibility of alternate energy option for city Debra Mayeux Basin Resources a community solar farm is being studied by the city of Farmington as an alternative energy option for residents within the city of limits.

City Manager rob Mayes said the city has been studying the feasibility of the solar farm for quite some time and is preparing to look at some hard numbers in the near future.

“We are going to be sending out to rFP (requests for proposals) to get firm pricing,” Mayes said. “This is the next step in our feasibility analysis, so we can analyze the real numbers.”

Mayes said the city is in the “due diligent study phase” as it studies different locations for the solar farm and looks at hard numbers. “We need to see how much it will cost.

Then, we can find out if the costing model is something the public would buy into.”

The community Mayes solar farm is similar to a solar garden, in which residents, who might not have the ability to put solar panels on their home, could purchase a section of the farm. Community solar is defined by the u.S. Department of energy “as a solar-electric system that, through a voluntary program, provides power and/or financial benefit t to, or is owned by, multiple community members.”

The National renewable energy Laboratory found in a 2008 study that only 22 to 27 percent of “residential rooftop area is

The Hatch site was built by renewable energy contractor Blattner Energy Inc and is owned and operated by NextEra Energy Resources, LLC. El Paso Electric has committed to buying the center’s power for the next 25 years from NextEra under a long-term contract.

suitable for hosting on-site photovoltaic systems after adjusting for structural, shading or ownership,” according to the Department of energy, which added that community options are needed to expand access to solar power for renters, people with shaded roofs and/or residents who do not want to install a solar-powered residential system on their home. Financial reasons also come into play.

The Department of energy began promoting solar farms as a way to make solar power available and even affordable to renters and homeowners who would otherwise have difficulty accessing solar energy.

There are community solar farms in California, Colorado, Florida, Massachusetts and utah, and tax credits were extended for them in 2011, when former Democratic Colorado Sen. Mark udall introduced the Solar uniting Neighborhoods, or SuN act.

The SuN act enables groups of individu-

als and/or homeowners associations to develop utility-scale solar-power facilities in partnership with local utilities distributing the power. Then, owners of the solar credits receive solar energy based on the percentage of credits they own.

“These projects have the potential to drastically increase the adoption of clean energy nationwide, but the tax code hasn’t kept up,” udall said in a previous news report. “you can get a 30-percent tax credit for putting a solar panel on your house, but not for investing in a solar farm.”

The city of Farmington continues to study it, and if its development is decided upon by the city government “people could buy into it and have a piece of it,” Mayes said. “This would give them the opportunity to have solar credits on their utility bill.”

Mayes added he is “excited” about the prospects of the solar farm.

www.basinresourcesusa.com • WINTER 2016

BASIN RESOURCES 21

Department of the Interior rule provides foundation for the future of BLM’s Renewable Energy Program Debra Mayeux Basin Resources The bureau of Land Management announced Nov. 10, a plan to advance President Obama’s Climate Plan as a means to create jobs, cut carbon pollution and develop, a clean domestic energy.

The new rule governs solar and wind energy development on public lands, and according to Interior Secretary Sally Jewell, it strengthens existing policies and creates a new leasing program that will support renewable energy development through competitive leasing processes and

* BLM 33

WINTER 2016 • www.basinresourcesusa.com

22 BASIN RESOURCES

Sylvia little: A leading lady in New Mexico oil and gas industry Dorothy Nobis Photos by Curtis ray beNally sylvia little has never met a challenge she couldn’t make into an opportunity. sylvia’s father was an accountant and while she was still in high school, sylvia helped him with clients’ taxes and bookkeeping. in her spare time, sylvia and her father built furniture. she learned the fine art of carpentry from her dad – and it never occurred to her that what she was

doing might be considered “men’s work.” she attended college and worked as a secretary to the District attorney in Dallas. she worked for a Federal District Judge in Wichita, Kansas, and enjoyed employment with several large oil companies in Dallas and albuquerque. sylvia’s husband, Curtis, was a geologist who had worked for independent oil companies. Curtis recognized the importance of the oil and gas industry in the san Juan basin of the Four Corners and decided he

wanted to be part of it. the couple moved their family – which included a daughter, susan, and a son, robert – to Farmington, to start a business.

Little Oil and Gas began in 1977 little oil and Gas inc. opened in 1977 and focused on buying, drilling and operating oil and gas properties in the san Juan basin. Curtis did the geology and the field work, while sylvia did “just about everything else.”

www.basinresourcesusa.com • WINTER 2016

BASIN RESOURCES 23 When a relative of Sylvia’s passed away, she was the beneficiary of his life insurance. Also, recognizing the importance of oil and gas in the San Juan Basin when Little Oil and Gas was created, Sylvia decided to invest in the industry as well.

“I bought the first oil and gas lease – on the Bluffs – in the San Juan Basin,” Sylvia said proudly while seated in her office on 20th Street. “I thought it would be a good investment.”

Curtis goes back to geological work The company did well, and with his wife sharing leadership in the company, Curtis resumed his study of geological formations that could be identified as conforming to the requirements made by the federal government to qualify for a higher price in the market.

“At this point, the federal government still had price controls on all oil and gas production in the country,” Sylvia said.

“However, the feds issued a statement that, in certain geologically proven formations – strata – called “tight sands,” they would raise the controlled price of natural gas produced in those wells that had to be fracked to ensure production.”

“The government was rewarding us for fracking,” she added with a shake of her head. “After Curtis had qualified certain formations in the San Juan Basin as ‘tight sands’ by the government, we proceeded to

drill two wells and went to the necessary trouble and expense of fracking them both.

“After they were proven producers, we applied for a promise we had gotten from the government that they would give us higher prices for ourselves and our very few partners in those two wells,” Sylvia continued.

“But the government informed us that their promise had been rescinded because they decided to lift price controls and let the free market decide the price of oil and gas. We felt a really big hit.”

Curtis passed away in 1987, and Sylvia continued the work they had begun. Another government change in regulations a

WINTER 2016 • www.basinresourcesusa.com

few years later was significant enough to shut many natural gas wells in the San Juan Basin.

“I was one of the only local independent operators who had developed markets in California to purchase my natural gas production and to have arranged a contract with El Paso Natural Gas Company to transport my production to their utilities,” Sylvia said. “My wells were all open and producing. A group of local independent operators called me and asked me to meet with them to discuss the situation. They asked if I would market all of their gas production under the terms of a co-op.”

24 BASIN RESOURCES

Joined the co-op Sylvia agreed, but eventually each company in the co-op trained their own staff to do the marketing. That didn’t stop Sylvia from continuing her chosen path – a path that was primarily traveled by men.

Then-New Mexico Senators Pete Domenici and Jeff Bingaman arrived in Farmington on a “field trip” to hear testimonies regarding the co-op Sylvia started.

A hearing was held in the Little Theater at San Juan College with representatives of four of the local independent producers and a representative from the New Mexico Oil Conservation District speaking and sharing their concerns on marketing natural gas production in the San Juan Basin. Sylvia was the last to speak.

“After hearing my comments, one of the senators questioned each of the other speakers about my testimony,” Sylvia said. “He asked if my assessment of the situation was correct. They (the other independents) con-

firmed my assessment and each of them complimented my analysis. The standing room only audience of local supporters erupted in applause and cheers.”

The senator’s doubts about Sylvia’s knowledge and experience in the industry were dispelled and, a few days later, the local group was informed that the U.S. Senate had approved the local organization of a co-op.

New Mexico Economic Development Commission Sylvia’s contributions to the oil and gas industry were increasing, and so was her public profile. She was appointed to serve on the New Mexico Economic Development Commission by Governors Bruce King, Gary Johnson and Bill Richardson.

A trade mission to Mexico City with then Governor Bruce King and Congressman Bill Richardson included a meeting with Mexico’s transportation department, Sylvia said.

“We were meeting with different people, and Governor King asked me to go with him to a presentation (at the transportation department),” she said. “Governor King asked them why Mexico didn’t have flights to Albuquerque.”

King, Sylvia and others from New Mexico also met with the mayor of Mexico City.

“We asked him why Mexico didn’t build pipelines through Mexico City,” Sylvia said.

“He said there were relics of past civilizations under the streets, which prevented them from fixing the streets, let alone building pipelines.”

President of IPANM Sylvia was the only woman included in those trips and one of very few women in the industry. She was the first woman to serve as president of the Independent Petroleum Association of New Mexico and the only president to serve two terms. Her list of contributions to the industry includes

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BASIN RESOURCES 25 serving on the Lands Committee of the Independent Petroleum Association of America, the board of directors of the Independent Petroleum Association of Mountain States, the executive committee of the New Mexico Oil and Gas Association, the board of the Association of Commerce and Industry of New Mexico, the Industry Advisory Committee of the New Mexico Department of Energy and the New Mexico Governor’s Business Advisory Council.

Assertive, knowledgeable, aggressive and hard-working, Sylvia Little was a woman in a man’s world, and a woman men respected.

Susan Little She also raised a daughter who is much like her.

Susan Little began helping in the company’s office when she was in the seventh grade, doing office work and occasionally going to locations with her dad. After

graduating from high school, Susan left Farmington and the family business to attend Southern Methodist University in Dallas. Following her graduation from

SMU, Susan worked for Children’s Miracle Network in Dallas, before moving to Los Angeles to work in the Real Estate Asset Management Department of Watson Land Company.

Susan planned to return to New York City, where she had done some modeling and where she developed a love for the city when she was younger, but made a stop home to Farmington in 1999 to help sell the operated wells before moving on to the Big Apple.

Susan never made the trip back east. A marriage, two children, a diagnosis of a blood disorder (ITP) and a divorce kept her in Farmington.

During the years Susan spent once again working in the offices of Little Oil and Gas, she made her own mark on the company.

“My father died in 1987, and my mom continued to operate the wells, as well as

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26 BASIN RESOURCES meet the needs of a changing industry,” Susan said. “As industry regulations changed the way natural gas was sold, my mom jumped in and learned how to go about marketing her own gas, and found a completely new client base as she marketed gas for other operators and interested owners in wells with other operators.”

Focus shifts to development “We have shifted our focus from development of new properties to oil and gas business services,” Susan added.

Susan streamlined the paperwork process of the business and created a data base that documents the work done by the client and

by Little Oil and Gas. While comfortable working behind the scenes now, Susan is as strong and independent as her mother is.

“It never occurred to me that being a female would ever be a problem for me,” Susan said. “I never felt like I had to prove myself. My mother was very good as what

she did and what she does. I always assumed that’s what I needed to be like.”

“I’m not sure my mom ever specifically talked about Oil and Gas Inc. being a male dominated industry, or any industry in those terms, for that matter. Because she was my example, it never occurred to me that I might have issues in the work place by being a woman,” Susan said. “What my mom did teach me was to be independent, confident, and to speak up when necessary.

By example, she taught me not only a good work ethic as far as putting in the time, but also reaching out to find the information I needed so I could be knowledgeable about whatever industry I was working in.

Took care of her employees Sylvia’s determination to continue the family business after the death of her husband and her ultimate success are matched by her desire to provide a good work environment for her employees.

“The men and women who worked for me had flex time,” Sylvia said. “They were parents who had children who needed to be picked up after school, programs at school their children were in that they needed to attend. I gave them flex time based on what we all needed to do.”

Carmel Gutierrez has worked for Little Oil and Gas for 36 years. When she retires in 2018, her daughter will take her place. “I hope she likes it (the job) as much as her mom does,” Sylvia said.

Whether it has been raising a daughter who is as independent, knowledgeable and self-confident as she is, giving women who work for her the opportunity to remain involved in their families, or blazing a trail for women in the oil and gas industry, Sylvia Little has always made it look easy.

“Because I was always (as knowledgeable) in some areas as the men, they never had a problem working with me,” Sylvia said.

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BASIN RESOURCES 27

Working women face challenges “I’ve never been aware of any issues about women in the industry,” Susan added. “All working women face challenges in the work environment and I don’t take anything personally.

You can fight about a conflict you’re having or you can fight about doing your job. I do my job.”

The ability to change as the industry has changed and the ability to retain knowledgeable and loyal employees has been instrumental in the continued success of Little Oil and Gas, Susan said. And those changes are likely to remain.

“When I retired, the company ceased to be an operator,” Sylvia said. “I chose a company in Denver to take over our operations. And now, with Susan and Carmel in charge of the office, we here at Little Oil and Gas Inc. continue to serve our clients by marketing their oil and natural gas production, making required reports and paying taxes and royalties on their behalf to the state, Indian and federal governments and our year-end reports are also reliable documents for their tax returns.”

“I’m not expecting my children to take over Little Oil and Gas Inc.,” Susan said. “But if they do, it will certainly be a surprise. It’s hard to know what challenges they will face as the energy industry continues to change.”

Sylvia summed it up in a message to the New Mexico Economic Development Team in 1997.

“Quality training in business and industry from schools in all parts of our state can make a big difference in influencing the expansion of local companies and bringing in new businesses into the state of New Mexico. Other incentives, such as tax changes, highway improvements and water uses, may seem to be more expedient considerations for economic development.” “(But) our children won’t be able to take advantage of new job creation without access to adequate education.”

George Sharpe is the Investment Manager for Merrion Oil & Gas and saw Sylvia often at industry events.

WINTER 2016 • www.basinresourcesusa.com

“My recollection of Sylvia is that she was the leading lady in a movie dominated by old white men,” Sharpe said. “Sylvia was always graceful and professional, and in a room filled with Tom Dugan, J. Greg Merrion, Bob Bayless and the like, she could definitely hold her own.”

“She was the queen of the ball and, frankly, this ball needed a queen because it had way too many kings,” Sharpe added.

28 BASIN RESOURCES

General Electric Oil Gas and Baker Hughes merger creates second-largest oilfield services provider DEBra MayEux Basin Resources a merger between Baker Hughes and General Electric Oil and Gas will create a company that is “present from the molecules to the megawatts,” according to CEO Lorenzo Simonelli, who spoke during the announcement of the merger.

This agreement brings Baker Hughes under the umbrella of General Electric and marries the equipment side of the business with the digital.

GE Oil and Gas has focused its industry offerings on digital products such as imaging sensors, electronic technologies, software sciences and analytics, materials advanced manufacturing and computational fluid dynamics.

Baker Hughes has been an industry leader in drilling and evaluation, completion and production, production and surface equipment, subsea and drilling systems, Liquid Natural Gas (LNG), and pipeline solutions, refinery and petrochemical solutions.

The new company will offer all of those services.

“We feel Baker Hughes has a great set of businesses that are complementary to GE,” Simonelli said. “The new Baker Hughes will have the capabilities to move from being an

Immelt

oilfield equipment and service company to being a provider of oil and gas productivity solutions.”

He stated that the companies’ “cultures are a perfect fit and employees will have an exciting place to work.”

Simonelli continued, “GE Oil & Gas and Baker Hughes are an exceptional cultural fit, sharing a commitment to exceeding customer expectations. Both companies’ employees will benefit significantly from being part of a larger, stronger company that is positioned for long-term growth.”

under the merger, which was unanimously approved by both boards of directors, GE contributed 100 percent of its GE Oil and Gas Company along with $7.4 billion in cash for 62.5 percent of the ownership. Baker Hughes contributed 100 percent of the company and will retain 37.5 percent of the new company. Baker Hughes shareholders will receive a special one-time cash dividend of $17.50 per share. The new company’s board of directors will be made up of five people from GE and four from Baker Hughes.

www.basinresourcesusa.com • WINTER 2016

29 BASIN RESOURCES “This new company will be a very strong industry competitor,” said Jeff Immelt, chairman and CEO of GE. “The new company is exceptionally well positioned to serve our customers. … We are building a stronger business for the future.”

Martin Craighead, vice chairman of the “New” Baker Hughes Board of Directors, agreed, calling the merger a “landmark day” for the two companies in which they have created a “stronger company uniquely positioned for long-term growth.”

He characterized the “New” Baker Hughes as a “far more resilient and cycleresistant” company.

“Together, Baker Hughes and GE will create an end-to-end provider of technology equipment and services across the whole spectrum” of the oil and gas industry with products and services in the upstream, midstream and downstream markets, Craighead said. “I see this transaction as an acceleration of the existing strategy of Legacy Baker

Hughes, which is based on leveraging its strength and product innovations to radically improve the economics of oil and gas production for our customers.”

According to Immelt, GE got into the oil and gas industry “based on our belief that customers would seek more highly engineered solutions and would do so on a global basis that favors this company.”

Immelt said that as GE Oil and Gas was built he was impressed by his customers’ respect for Baker Hughes. “GE Oil & Gas is a key GE business, one that fully leverages the GE Store. As we go forward, this transaction accelerates our capability to extend the digital framework to the oil and gas industry,” he said.

“An oilfield service platform is essential to deliver digitally enabled offerings to our customers,” Immelt continued.

“We expect Predix to become an industry standard and synonymous with improved customer outcomes. GE investors

will benefit through ownership of a stronger business with substantial synergies and an improved competitive position.”

Immelt stated that he believes there will be a slow recovery in the North American market with LNG and a larger production based off shore. He is projecting a slow oil recovery that will go from $45 to $65 per barrel by 2019. “This is the right time in the cycle to invest,” he said.

The merger is expected to be complete by mid-2017, and then the “New” Baker Hughes will operate in more than 120 countries.

Baker Hughes had three locations in Farmington, at 1215 Basin Road, 3111 Bloomfield Hwy and Baker Hughes Pumping Services at 3250 Sothside River Road.

In November Baker Hughes’ last round of layoffs in Farmington cut 67 from the Pressure Pumping operations on Southside River Road.

www.basinresourcesusa.com • WINTER 2016

30 BASIN RESOURCES Peterson retired at the end of 2009, 12 days shy of his 77th birthday. He and his wife, Marlene, have been married for 60 years. They have four sons, 14 grandchildren and 17 great-grandchildren.

Durango, Colo., office for the U.S. Geological Survey, but was transferred to the Roswell. N.M., office, from which he retired.

T. Greg Merrion Steve Henke Steve Henke moved in 1964 to Socorro with his family. He is a 1972 graduate of Alamogordo High School and a 1977 graduate of New Mexico State University, where he earned a bachelor of science degree in agriculture.

Henke first came to Farmington in 1982 at the beginning of the coal bed methane drilling programs; he was working for the Bureau of Land Management. He had a 34year career with the federal government working in the Las Cruces, Farmington, Albuquerque and Taos offices of the BLM. During his tenure he completed the Oil and Gas Leasing Plan for the entire Albuquerque district. He also served as the Taos area manager, executive director of the Southwest Strategy, and as the Farmington Field Office District Manager. During his time in Farmington, Henke completed the BLM’s 2003 Resource Management Plan and Environmental Impact Statement, which laid the groundwork for more efficient drilling approvals, and more than 5,000 wells were drilled on the federal mineral estate during his tenure.

Henke left the BLM in 2010, citing the changing political environment under the Obama Administration, and he became president of the New Mexico Oil and Gas Association, a position he had until September 2016.

Henke is retired and living in Rio Rancho. He has three children.

Jerry Long Jerry Long worked in the 1950s as the district manager for the United States Geological Survey. He was a regulator, considered to be a nice guy who went to extremes to work with operators to develop federal leases. By the early 1980s, Jerry opened the

T. Greg Merrion is the president of Merrion Oil and Gas Company, the 33rd largest producer of natural gas in New Mexico. Merrion Oil and Gas is a familyowned, independent production company with a 56-year history in the San Juan Basin. It also has operations in Colorado and Wyoming.

T. Greg graduated from the Colorado School of Mines with a degree in petroleum engineering and a master’s degree in business from New Mexico State University. Before going to work for the family business, he worked as a production engineer for Superior Oil and Mobil.

In addition to his responsibilities at Merrion Oil and Gas, T. Greg is the managing general partner of the Merrion Family Limited Partnership, which makes passive investments in real estate, mezzanine loans, and venture capital. He also is the president and founder of the Merrion Family Foundation, which supports education, economic development, free enterprise, and many other causes in New Mexico and the Four Corners area. He also is the president of the New Mexico Prosperity Project and is a member of the New Mexico Amigos.

T. Greg is a past president of the Independent Petroleum Association of New Mexico, a past chairman of the New Mexico Oil and Gas Association, and a past member of the Farmington Planning and Zoning Commission. He is a graduate of Leadership San Juan and Leadership New Mexico, and he has served on the boards of New Mexico Community Capital, San Juan College Foundation, and San Juan Safe Communities.

The Merrion Family Foundation, under the leadership of T. Greg, founded the FACE program with the purpose of increasing the number of students who go to col-

lege. A FACE adviser works at each of Farmington’s high schools to help students apply to colleges, meet the necessary requirements to go to college, and apply for scholarships and other forms of financial aid.

T. Greg also worked on the E>P economic development project that resulted in Four Corners Economic Development.

T. Greg is married to Susan and they have four children.

Earl Shay Brown The late Earl Shay Brown was in college when he was drafted to serve as a pilot in World War II. After the war, his father Tom G. Brown, a certified early pioneer of the oil and gas industry, told him “If you want to make a living, you’ve got to do it in the oilfield.” Brown took that advice and went to work for Noble Drilling Company. Interestingly, during the Korean War Brown was called upon to serve as a pilot, but Noble called the State Department and asked that he remain with them. Brown was allowed to keep working in the oilfield.

Brown later went to work for Baker Oil Tools in Texas, and by 1954 he bought a set of tires for his car and trailer, and moved to Cuba, N.M. He and his wife, Maurine, fell in love with New Mexico and ended up living in Farmington.

Brown went to school in Denver for one week every year, paid for by Baker. He always made a perfect score on his exam.

The company also sent him to Alaska two or three times to work on an off-shore drilling rig.

During his tenure in the oil and gas business, Brown worked on more rigs than his family could count. He had several stories about muddy roads and icy highways, but his family said nothing kept him from getting the job done.

Brown retired as the district manager of Baker Oil Tools in 1986, but worked as a contract laborer for the company in 1988.

* Celebrating 95 Years 32

www.basinresourcesusa.com • WINTER 2016

32 BASIN RESOURCES He was a self-employed consultant from 1989 to 1996.

He died Dec. 4, 2015, at the age of 94.

Joe C. Salmon The late Joe C. Salmon was a roughneck in Dallas, Texas, when he started in the oil and gas business. One day while working on the rig, he saw a nicely dressed man walk up on the rig floor. Salmon asked who he was and they told him he was the geologist. At that moment, Salmon decided it was his last week working as a roughneck. The next week he enrolled at the University of Oklahoma to study geology.

By 1951, he graduated with a bachelor of science degree and went to work for Southern Union Gas Company in Dallas.

By 1952, Salmon was transferred to Farmington to work as the assistant district geologist.

In 1954, Aztec Oil and Gas Company

took over Southern Union Gas Company and it became an independent. Salmon became the district geologist. At the time, Aztec Oil and Gas owned all or part of the interest in 251 gas wells and 136,000 net acres of leases. Salmon eventually was named the district superintendent over the San Juan Basin.

In 1974, Salmon was the voted the vice

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president of the New Mexico Oil and Gas Association. He was chairman of the Board of Western Bank, past director of San Juan Country Club, and an active member of the San Juan Deputy Sherriff ’s Reserve Unit.

Each year the Desk and Derrick Club selects people such as these – people who have made their mark in the oil and gas history of the San Juan Basin.

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BASIN RESOURCES 33

BLM

continued from 21

incentives to encourage development in suitable areas.

“This new rule not only provides a strong foundation for the future of energy development on America’s public lands, but is an important and exciting milestone in our ongoing efforts to tap the vast solar and wind energy resources across the country,” Jewell said.

“Through a landscape-level approach, we are facilitating responsible renewable energy development Jewell in the right places, creating jobs and cutting carbon pollution for the benefit of all Americans.”

The action plan calls on the Interior Department to permit 20,000 megawatts of renewable power by 2020.

The rule formalizes key aspects of the BLM’s existing Smart from the Start approach to renewable energy development.

Notably, the rule: • Supports development in areas with the highest generation potential and fewest resource conflicts through financial incentives, awarding leases through competitive processes and streamlining the leasing process

• Ensures transparency and predictability in rents and fees – for example, gives developers the option of selecting fixed rate adjustments instead of market-based adjustments; and • Updates the BLM’s current fee structure in response to market conditions, which will bring down near-term costs for solar projects.

Since 2009, the Interior Department approved 60 utility-scale renewable energy projects on public lands, including 35 solar, 11 wind and 13 geothermal projects and associated transmission infrastructure that could support nearly 15,500 megawatts, or MW, of renewable energy capacity, or enough to power approximately 5.1 million homes.

“The BLM is incredibly proud of the work we’ve done over the last eight years supporting wind and solar development,” BLM Director Neil Kornze said. “We went from only a handful of approved projects in 2008 to a robust program with over 15,000 MW approved, six times the amount we had approved in the 25 prior years.”

The rule, according to the BLM, compliments the department’s landscape-scale planning efforts, including the Western Solar Plan, California’s Desert Renewable Energy Conservation Plan, and Arizona’s Restoration Design Energy Project, which

were designed to streamline development in areas with high generation potential, while protecting important environmental, cultural, and recreational resources.

It also supports the full range of development activities anticipated by the BLM across the lands it manages. “The rule’s competitive leasing provisions will help renewable energy development flourish on the 700,000 acres of public lands that have been identified in Arizona, California, Colorado, Nevada, New Mexico, and Utah,” the BLM stated in a prepared release.

The rule refines the application review process by giving developers the option to lock in fixed-rate adjustments and by providing for MW capacity fee phase-ins. application-by-application process.

“By offering incentives for development in areas with fewer resource conflicts, the BLM’s rule provides a framework to support all of the landscape scale planning we’ve done to better plan for and manage wind and solar development,” Assistant Secretary for Land and Minerals Management Janice Schneider said. “The rule also refines the BLM’s approach to fair market value, to ensure that taxpayers get a fair return from these important resources.”

The regulations will become effective 30 days after they are published in the Federal Register.

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advertisers directory

Highlands University.................................15 505-454-3004 nmhu.edu/energy Kelley Oilfield Services..............................36 3601 N. 1st Suite M 505-632-2423 Bloomfield, NM www.kosinm.com Kimo Vista Solutions .................................10 4250 E Main St., Suite G Farmington, NM Kozi Homes ..............................................31 Farmington, NM 505-327-9008 www.KoziHomes.com Morgan Stanley/Ron Dalley .......................13 4801 N. Butler, Suite 14101 Farmington, NM 505-327-6201 www.morganstanleyfa.com/ronald.dalley Navajo Transitional Energy Company ...........2 www.navajo-tec.com Next Level Home Audio & Visual..................7 7801 E. Main Farmington, NM 505-327-NEXT www.327Next.com

Partners Assisted Living ...........................16 313 N. Locke Ave. Farmington, NM 505-325-9600 www.partnersassistedliving.com PMS ...........................................................9 1001 West Broadway Ave. Farmington, NM 505-327-4796 www.pmsnm.org QuickLane Tire & Auto Center ....................19 5700 East Main St. Farmington, NM 505-566-4729 R.A. Biel Plumbing & Heating ....................34 1205 Troy King Road Farmington, NM 505-327-7755 www.rabielplumbing.com Red Brick Pizza.........................................27 5150 E. Main St. Farmington, NM 505-326-6222 Reliance Medical Group .............................26 3451 N. Butler Ave. Farmington, NM 505-324-1255 www.reliancemedicalgroup.com Rush Truck Centers ....................................3 6521 Hanover Road N.W. Albuquerque, NM 505-839-3600, 800-357-6643 www.rushtruckcenters.com

Summit Truck Group..................................24 5444 US Hwy 64 Farmington, NM 505-325-3521 www.summittruckgroup.com SunRay Casino..........................................27 Farmington, NM 505-566-1200 Treadworks ..............................................32 4117 E. Main St. Farmington, NM 505-327-0286 4215 Hwy. 64 Kirtland, NM 505-598-1055 US Eagle Federal Credit Union ...................29 3024 E. Main St. Farmington, NM 888-342-8766 useaglefcu.org Vernon Aviation ........................................17 Farmington, NM 505-564-9464 www.vernonaviation.com Ziems Ford Corners ....................................5 5700 East Main Farmington, NM 505-325-8826

Furnace Breakdown?

CALL THE TOP DOG! When it comes to heating breakdowns you need to tell a true-blue friend. Our company will immediately make tracks to relieve your problem and will be loyal to you long after the service call.

That’s why R.A. Biel Plumbing and Heating is the leader of the pack.

Now that’s worth wagging your tail about!

• Carriers Boilers & Furnaces • Duct Cleaning • Drain/Sewer Cleaning • Video Drain Inspection • Electronic Leak Location • Water & Sewer Repiping • Bathroom & Kitchen Remodeling • Water Heaters • Refrigeration & Evaporative Cooling • Backflow Preventer Testing

• Complete Gas Service • LP Gas Service • Carbon Monoxide Testing • Complete Septic Systems • Backhoe Service & Trenching • Planned Service Agreements • 24-Hour Emergency • All Major Credit Cards Accepted • 100% Satisfaction Guaranteed since 1988 • 24 Hour Emergency Service

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