PB Energy September 2013

FREE

VOLUME 1 NO. 10

SEPTEMBER 2013

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AVALON SHALE 8

THE FUEL

12

OF THE FUTURE

APACHE GAS

OIL COMPANIES LOOK 16 FOR ALTERNATIVE HOUSING

TO COMBAT HIGH RENTS FOR EMPLOYEES

A TIME OF

6 WAYS TO PUT THE “GOOD” IN GOODBYE

ALTERNATIVES • U.S. RIG COUNT • TOP 35 Drillers & Operators

Industry Data

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News

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Events

GARY ALLAN

ROCKS MIDLAND 33

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Auctions

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Calendar

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Travel

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Tips

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Energy

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Tech

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SEPTEMBER 2013

CONTENTS 8

PBE FEATURES 8

Avalon Shale

12 The Fuel of the Future - Apache 16 Oil Companies look for Alternative Housing

to Combat High Rents for Employees

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OTHER EDITORIALS

11 Calendar of Events 15 6 Ways to put the “Good” in Goodbye 18 Conferences in August - September 19 Upcoming Auctions 20 Festivals and Events in Texas 24 Tech Bites - Computer Programming Computers?

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Safety Tips

28 PBE News Briefs:

Basin, Government, State, Nation, World & OffShore 33 PBE Cares - Gary Allan rocks Midland 34 Restaurant Bites - Teak & Charlie’s Jersey Girl Pizza 36 PBE Inspires 38 By The Numbers: Texas Rig Count, Top Drillers, Top Operators 41 This Month in Petroleum

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PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

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LETTER FROM

THE EDITOR “Are you willing to create an alternative or waiting for others to give you an option?

The more work that we do, the more resources we use. The more resources we use, the more our resources become strained. It’s a vicious cycle we know all too well in West Texas. That’s why the search for alternatives has played a key role in the long-term strategic plans of many top oil and gas companies. In this issue of PBE Magazine, we dive into a variety of alternatives our area is currently using or exploring to help lessen the load on the resources we so often use, and we ask the question: Are you willing to create an alternative or waiting for others to give you an option?

We spoke with local leaders in the area of liquid natural gas and the pumping stations that have been cropping up across West Texas as an alternative to the traditional gas and diesel we’ve been pumping into our vehicles. We also spoke with experts about a Shale alternative that’s getting a lot of attention and diverting some of the focus off of the Cline Shale we’ve been hearing so much about. Then there is the new housing alternatives local oil and gas companies are developing for the existing and new employees to combat the current housing challenges.

On a lighter note, we also explored a local pizza alternative if you’re looking to break away from the same-ol’, same-ol’ slice of pie. Whether it’s inventing new tools or finding new methods to operate, people in our area are always coming up with new and innovative ways to do the same work. It’s just part of our ‘M.O.’, and part of being a community poised for the future means we must always be looking for alternative resources to secure our long-term viability and success. It’s a concept many of our local leaders are certainly embracing with open arms. We appreciate all of you who have been following us throughout our first 6 issues and we’d love to hear your suggestions if there’s something you’d like to see covered in future editions.

Carlos Madrid Editor in Chief/Publisher sales@pbemag.com /PBENERGYMAG @PBENERGY

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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EDITORIAL CONTRIBUTORS PBE MAGAZINE CONTACTS

EDITOR IN CHIEF/PUBLISHER

Carlos Madrid sales@pbemag.com 432. 559. 5886 ART DIRECTOR/LAYOUT & GRAPHICS

Luke Pawliszyn Lukasz Design Studio West Hollywood, CA luke@lukaszdesign.com

HALEY RAGSDALE WRITER haley@pbemag.com

SUBMISSIONS Submit story ideas & other news to haley@pbemag.com ADVERTISING For advertising info call 432. 559. 5886 or email sales@pbemag.com PUBLISHED BY: PBE Magazine, LLC. Permian Basin Energy Magazine 4500 Erie Drive Midland, TX 79703 Main Phone: 432. 559. 5886

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AUDRIE PALMER FREELANCE WRITER Midland, TX audrierpalmer@gmail.com

DANIEL STEPHENS SENIOR PASTOR

Copyright © 2013 Permian Basin Energy, Inc. • Mad Ads Media All rights reserved.

Reproduction in whole or in part without the written permission of PBE MAGAZINE, LLC is strictly forbidden. The greatest care has been taken to ensure the accuracy of information in this magazine at time of going to press, but we accept no responsibility for omissions or errors. PBE Magazine welcomes any comments, feedback, suggestions, and/or submissions for consideration for publication. These may be submitted to: sales@pbemag.com.

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Mid-Cities Community Church Midland, TX daniel.stephens@midcities.org

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by Haley Ragsdale

Ever since it was discovered that “There is an ocean of oil under our feet,*” the search for the next big gusher, or new play, is always a topic of conversation.

The Avalon Shale located primarily in New Mexico is a relatively new play and getting some consideration from oil producers.

Hoxie Smith, Director of the Petroleum Professional Development Center at Midland College explained that the play started getting attention about three to four years ago. The Avalon Shale is also sometimes referred to as the Leonard Shale.

“The major players in the Avalon Shale are EOG Resources, Anadarko Petroleum, Devon Energy, B.H.P Billiton, Cimarex Energy and Concho Resources,” Smith said.

years it is hard to get new companies to drill in the area because most of the premium acreage is leased.

“The horizontal wells in the Avalon Shale are producing three hundred to eight hundred barrels per day of oil so it’s a good oil play. EOG Resources is getting about a forty percent return on investment.” Smith said.

It may seem that never before heard of oil deposits continue to make front page news, but that is because new technology is identifying these new zones.

According to the Web site www.oilshalegas.com, the Avalon Shale is an oil and gas field located in Eddy, Lea, and parts of Chaves County, New Mexico. It is located above the Bone Springs and Wolfberry Formation. The Avalon is composed of a series of sandstone zones.

Smith described, that the Avalon Shale is producing oil, natural gas liquids and natural gas. The play is rich in natural gas.

“The price of oil right now is high, and the price of natural gas is pretty low so most operators are really concentrating on drilling oil, even though this play is more of a natural gas producer,” Smith said.

He went on to explain that Lea and Eddy counties have been such constant oil producing counties for so many 8

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

“We have five to six different plays in the Permian Basin and Southeastern New Mexico that we didn’t have six years ago due to hydraulic fracturing and horizontal drilling,” Smith said.

These include: The Wolfberry, Wolffork, Wolfbone, Cline Shale, Avalon Shale plus horizontal drilling in the previously producing Delaware Mountain Group and Wolfcamp.

It is more expensive for producers to drill horizontal wells. Smith said the cost can be three to seven million dollars but the production from these wells is so much more, it often pays off.

The economic boom in the Permian Basin is due to three factors according to Smith: - Hydraulic Fracturing - Horizontal Drilling - The Price of Crude

“As long as the price of crude stays above seventy to seventy five dollars that makes the cost of the new technology worth it,” Smith said.

A common question among those who work and depend on the oil industry in and around the Permian Basin has always been, just how long is this boom going to last?

Smith’s answer should help to calm their fears: “We are fortunate to live in this part of the world. We have four hundred active rigs running in the Permian Basin out of fourteen hundred in the country. We have the lion’s share of the activity. We have an oily basin and a lot of oil that has yet to be produced. As long as there is no economic collapse that lowers the price of oil, or a technological breakthrough like new batteries that can store electricity generated by solar and wind power, I see the boom lasting ten years plus. I would hate to predict any further than that,” he said.

The Avalon Shale could be part of that equation that fuels the country in the coming years. *Quote from the movie “There Will Be Blood”

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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Promotional Products • TV/Video Production • Graphic Design • Photography

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OBSERVANCES AND CELEBRATIONS

SEPTEMBER 2013 Birthstone: Sapphire Flower: Aster

2 Labor Day is a Legal U.S. Holiday originating from the Central Labor Union to create a day off for the working man. Became a Federal Holiday in 1894.

National: Hispanic Heritage Month,

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LABOR DAY

Classical Music Month, International Square Dancing Month, National Piano Month, Honey Month,

GRANDPARENTS DAY

Self Improvement Month

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13 YOM KIPPUR

PATRIOT DAY

Patriot Day is observed In honor of the individuals who lost their lives as a result of the terrorist attacks against the United States that occurred on September 11, 2001.

Americans should display their flags at Half-Staff.

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STEPFAMILY DAY

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INTERNATIONAL DAY OF PEACE

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International Day of Peace is a day where individuals around the world unite in a worldwide movement to create a Global Ceasefire and a day of peace and nonviolence.

FIRST DAY OF AUTUMN

27 NATIVE AMERICAN DAY

OCTOBER 2013 Birthstone: Opal, Tourmaline Flower: Calendula

8 NATIONAL CHILDREN’S DAY COLUMBUS DAY

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Columbus Day is a observance honoring Christopher Columbus’s first voyage to the Americas in 1492. The holiday is observed in the United States by banks, the post office and most governments and schools, while most businesses remain open.

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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THE FUEL OF THE FUTURE NATURAL GAS IS CHEAPER, CLEANER and there’s plenty of it...

by Audrie Palmer

There are three qualities that many believe might make natural gas the new fuel of the future – that it’s clean, it’s abundant and it’s American.

What once was an experiment for the environment has turned into a sustainable market and has many in the industry optimistic for its future.

They’re so optimistic in fact that two of the largest selling companies like Apache Corporation and Trillium CNG have opened up fueling stations in the Permian Basin in the past year and, like many, are broadening their scope going into 2014.

In January, Apache began selling Compressed Natural Gas at two Stripes gas stations in Midland, at 3200 East State Highway 158 and 4508 North Big Spring Street, providing infrastructure not only for their company vehicles but for others in the area. With 19 fueling stations nationwide operated by Apache, only six are publicly accessible, said Apache Director Natural Gas Transportation Fuel Frank Chapel. The other 13 operate as private stations but with contracts for commercial and bulk sales.

About four years ago, Apache began to convert many of their fleet vehicles to be capable of using natural gas and in the Permian Basin, needed to build a supporting 12

station. Now, 500 of the fleets’ 1,100 Silverado pickups run on natural gas fuels making them more environmentallyconscious. The long-term goal is to convert 80 percent of its fleet to natural gas.

“Apache’s mission is to promote natural gas as the alternative transportation fuel of choice and to lead by example,” Chapel said.

And it’s a trend, Chapel said, is happening in other companies and entities as well. Those that have vehicles with higher mileage usage are converting the engines to be equipped to run on natural gas. Within the next few years, he expects many will see more garbage collector trucks and service vehicles converting over. AT&T plans to convert approximately 8,000 service units, Chapel added citing other companies such as Dillon Transport, UPS, Chesapeake Energy and Pioneer Resources as a few examples in this emerging trend.

The reasoning behind it is simple – not only is natural gas about 85 percent cleaner than gas or diesel but the fuel savings can be tremendous. Where diesel might sell

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

for an average $4 a gallon, in August, natural gas was priced at between $2 and $2.50 a gallon.

Chapel said Apache plans to host a natural gas vehicle workshop in the future because of the interest in the Permian Basin from other companies on using the fuel for their futures.

And it won’t just be with fleet vehicles, Chapel said car manufacturers like Ford, Chrysler and GM now offer bi-fuel (CNG or gasoline) pickup trucks.

And many residences have natural gas pipelines right to their homes. Chapel said a home fueling appliance and concept is being developed to where home fueling can be a viable option for many in the years to come.

Right now, the few appliances on the market are pretty expensive with a low flow rate, but Chapel said there are different companies and universities working on research development projects to develop a design model that many could fill up their cars while they sleep.

“I’m very hopeful we’ll have this in the foreseeable future. They’re working on the technology which could be a real game changer,” he said.

For Trillium CNG Southwest Regional Director Abraham Alijbouri, the abundance of natural gas is the real game changer for him.

Trillium CNG launched its flagship fueling station in Midland, at 4915 West Industrial Avenue, and houses its compressor , pipes and technology facility in Midland as well. The company now has 60 public stations across the nation with a goal of opening 101 by 2015.

“We do expect natural gas to take off significantly,” he said.

Alijbouri said with two heavy-duty engines, a 9-liter and 12-liter, now on the market to accommodate those hauling up to 80,000 pounds, he predicts the market will grow expotentially based solely on the fact that natural gas is an economically cheaper and environmentally safer product for companies to utilize.

It’s also how much natural gas there is in Texas that Alijbouri says is an advantage for many in the market.

The development of natural gas as the fuel of the future is a great story to tell and Chapel added he’s hopeful that in the coming years, there will be more makes and models of vehicles available for companies to purchase equipped to run on natural gas. The increase in the vehicles will then push for a demand in the need for more infrastructure and fueling stations.

Across the United States, there has been a 60 percent increase in CNG stations since 2009 with 1,235 stations now and half of those available to the public, according to a July 18 report by the Department of Energy’s Alternative Fuels database. Another 93 stations are either planned or permitted.

Chapel added that other companies like Love’s Travel Center is planning to build four stations in Houston while Shell announced 100 liquid natural gas stations and the Clean Energy project plans to build 150 by end of year.

But one of the most important things about natural gas is that it’s made in the United States.

By utilizing the new industry, Chapel said, not only will it create more employment for American workers but by having a domestic product we won’t have to rely on foreign needs.

“We have a 72 percent petroleum demand and $1 billion a day is spent to other countries importing petroleum products,” Chapel said.

He also believes natural gas will give the U.S. the energy independence and security that it needs and has a famous saying he likes to tell: “America now has more natural gas than Saudi Arabia has oil.”

“The supply is abundant,” he said. “The main reason I see them using it is for its economic value. I foresee it as the prominent fuel in America’s future because it’s cheaper and cleaner and it’s domestic.”

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

WAYS

TO PUT THE ‘GOOD’ IN GOODBYE

by Chester Elton

On Wednesday night, I was at my local Apple store with my son Brinden when everything stopped. Employees from every department excused themselves from various conversations with customers and formed a human corridor down the middle of the store. Then they started cheering.

It wasn’t to launch a new product. No, it was to say goodbye to an employee who was leaving for another job — outside the company.

Anthony walked the gauntlet of cheers and backslaps with a wide grin. Wow, I thought, that’s how you say goodbye. He was honored in a public way, and unabashedly in front of customers. This Apple store did it right.

So often, goodbyes are done badly.

Friends on Wall Street have told me horror stories of their calls to Human Resources. After being “made available to the market” (a real comment from one HR person) they were then escorted out of the building by a guard with a Glock on his belt. Nice.

In offering advice to managers, I want to focus today on the quitting employee—someone who is moving on to a new opportunity. Often these people are treated indifferently or even callously. Perhaps they get a few minutes in a conference room with their team and then are shuttled off to HR to figure out their COBRA health plan. Or maybe they are asked to clean out their desks after-hours, alone, so as to not disturb the workflow. They end up leaving in the dark with a few cardboard boxes of personal items.

A sad and lonely way to end your time with a company that proclaims, “People are our most important asset.” Yeah, right. You think those employees are ever coming back? You think they are recommending your company to their friends?

The way you say goodbye says a lot about you, your values, and your culture. A dignified separation allows both parties to leave with good feelings. It’s advertising you can’t buy. The norm is a missed opportunity, worse is a damaged relationship—not only to those who leave, but to those who stay behind who see how you treat those who want a new challenge.

It doesn’t take too much to make a potentially bad situation into something positive. Here are some simple tips for the bosses of departing employees:

1 2 3

This isn’t about you.

Actually, sometimes it is about you. Maybe the departing employee hates you. Get over it, because even then you can’t make this about you. It’s about the person who’s leaving and, even more importantly, those who stay behind. How you say goodbye says a lot to his friends and co-workers. So stiff upper lip, smile, and take the high road.

Let them go graciously.

If a valuable employee wants to quit it’s certainly worthwhile it to put up a fight. Start with, “Is there something I can do to change your mind?” No counter offer at all sends a message about their value to you and the organization. But recognize that, in most cases, by the time most employees come to see you they have one foot out the door and offering more money probably won’t help. You can usually tell their true intent in that first conversation—is it to get a little more compensation or really leave.

Say thanks.

Let them know their service has been valued.

4 5 6

Time things right.

Two weeks is all the transition time you are going to get, or should expect to get. Unless the employee is your CEO, any more is overkill. Seriously, make them stay a month and they won’t do much of anything the last few weeks anyway.

Have a party.

Yes, you have to actually stop work at some point to acknowledge their departure. Take them and the team to lunch—and pick up the tab—or have a get together near the end of their last day.

Ask for advice.

With a pad of paper in front of you, ask what you can do better as a leader, how the team could run better. They may not be completely honest with you at first, but if you stay open and receptive and start taking notes, chances are they’ll start sharing some valuable tidbits.

Chester Elton - Author of “All In” a NY Times Best-Seller www.linkedin.com/in/chesterelton

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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by Audrie Palmer

With the strong economy in the Permian Basin, thousands of new workers have been drawn to the area, migrating in search of jobs and employment.

But the sudden influx of employees has proved challenging in terms of housing for oil field and servicerelated companies. While many apartments and hotels are offered in the area, the nearly double rent rates are hurting employees and leading them to seek alternative housing options.

That’s why companies like Halliburton have taken it upon themselves to build their own employee camps to keep and retain workers in the area.

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For the Iron Horse Ranch, a work camp outside of Odessa, the size of the facilities has doubled since the initial construction. Opened in the spring, the project started with between 120 to 150 rooms, each housing a single bed and bathroom, individual room temperature controls, refrigerators, microwaves and televisions. Now, recent construction has added almost 300 rooms to the ranch and they are at capacity.

The ranch is the second employee camp that Halliburton has constructed in the Basin, said Hotel Administrator Cherie Sweden. A second camp that offers up to 80 beds is located near Pecos.

But it’s not just rooms available for employees. The facility seeks to make workers as comfortable as possible

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

in their home away from home. A cafeteria on the grounds serves breakfast beginning at 4 a.m. with a late dinner concluding at 8 p.m. each day. There’s also a beautiful rec center, pool tables, workout room and flatscreen televisions where employees can use on their downtime to socialize, Sweden said.

Employees can live in the facility for free and the housing is used mostly for commuters; those who work in the Permian Basin for a few weeks before going home to their families, she said.

The idea of having employee lodging stemmed from the local housing hardships.

“When the boom started, local hotels were overfilled and raising their prices. It was just more cost effective to have an employee camp,” she said.

With the beautiful mountain lodge motif, tile work and cedar found at the ranch, Sweden said the facility has been a hit with many of their workers.

“They love it. When they first came, they couldn’t find a place to stay and three or six guys would be sharing an apartment. Now they have a place to stay here and it’s much more comfortable at the camps.”

Halliburton’s second lodging facility in Pecos is more of a place where workers can come in, rest, restock and get some sleep. It doesn’t have all the added amenities that the Iron Horse Ranch offers, Sweden said.

Employers becoming landlords is nothing new in the oil and gas industry, in fact it’s become a trend across the Permian Basin and even North Dakota where the state is now the second-largest crude producer, according to Bloomberg News.

“We’re doing what we have to do to keep workers in the area,” she said.

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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CONFERENCES IN SEPT. - OCT. 2013 ACS Symposium on Hydrotreating-Hydrocracking Technologies 09/08/2013 - 09/12/2013 Indianapolis, IN, USA www.abstracts.acs.org/chem/246nm/meetingview. php?page=session&par_id=557 Water Management for California Oil and Gas Event 09/10/2013 - 09/11/2013 Long Beach, CA, USA www.infocastinc.com/ca-shale13 Oil Sands Trade Show and Conference 09/10/2013 - 09/11/2013 McMurry, Alberta, Canada www.oilsandstradeshow.com/2013 SPE Liquid-Rich Basins Conference 09/11/2013 - 09/12/2013 Midland, TX, USA www.spe.org/events/lrbc/2013 International Oil and Gas Indonesia Expo 09/11/2013 - 09/14/2013 Jakarta, Indonesia +62 21 316 2001 www.oilgasindonesia.com Moscow Refining Gas and Petrochemicals Week 09/16/2013 - 09/20/2013 Moscow, Russia www.europetro.com/en/moscow_week_2013 Rice Global E and C Annual Forum 09/16/2013 - 09/17/2013 Houston, TX, USA (832) 596-6500 globalforum@rice.edu www.forum.rice.edu/upcoming-events/internationalforum-2013 AAPG Annual Convention and Exhibition 09/19/2013 - 09/22/2013

Pittsburgh, PA, USA www.aapg.org SEG International Exhibition and Annual Meeting 09/22/2013 - 09/27/2013 Houston, TX, USA www.seg.org/calendar Sakhalin Annual Oil and Gas Conference and Exhibition 09/23/2013 - 09/26/2013 Yuzhno-Sakhalinsk, Russia www.ibcenergy.com/filter/Offshore+Oil+%26+Gas Annual IPLOCA Convention 09/23/2013 - 09/27/2013 Washington DC, USA www.iploca.org ATCE Conference 09/30/2013 - 10/02/2013 New Orleans, LA, USA http://www.spe.org/atce/2013/index.php SPE Annual Technical Conference and Exhibition 09/30/2013 - 10/02/2013 New Orleans, LA, USA (972) 952-9393 (972) 952-9435 spedal@spe.org www.spe.org/events Water Management for Shale Plays Summit 10/01/2013 - 10/03/2013 Pittsburgh, PA, USA www.infocastinc.com/shale-pa13 AIChE Southwest Process Technology Conference 10/03/2013 - 10/04/2013 Galveston, TX, USA www.aiche.org/resources/conferences?page=1 SAP Solutions for the Energy Industry Event 10/06/2013 - 10/09/2013 Dallas, TX, USA www.sap-oil-and-gas.com AFPM Q and A and Technology Forum 10/07/2013 - 10/09/2013 Dallas, TX, USA www.afpm.org/conferences Executive Oil Conference 10/14/2013 - 10/15/2013 Midland, TX, USA Midland County Horseshoe Arena Executiveoilconference.com

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PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

Leading Auctions in the Oilfield Industry.

Upcoming Auctions and Auction Equipment listings from Tradequip International’s online and site-held auction companies.

Saurce: Tradequip International

Drilling Rigs

Prod.

Equip.

Drilling Equip.

Tubular Goods

Oilfield Trucks

Oilfield Trailers

Parts & Tools

www.tradequip.com

Support Equip.

SOUTHCENTRAL AUCTIONS

COMPANY

DATES

LOCATION

OILFIELD EQUIPMENT TRUCKS & TRAILERS

Kruse Energy & Equipment LLC

Sept 11, 2013

Odessa, TX

DRILL BITS

Kruse Energy & Equipment LLC

Sept 18, 2013

Dunkan, OK

OILFIELD EQUIPMENT TRUCKS & TRAILERS

Kruse Energy & Equipment LLC

Oct 09, 2013 Oct 10, 2013

Jourdanton, TX

OILFIELD EQUIPMENT TRUCKS & TRAILERS

Kruse Energy & Equipment LLC

Oct 23, 2013 Oct 24, 2013

Oklahoma City, OK

INVENTORY

INTERNET AUCTIONS

COMPANY

DATES

LOCATION

INVENTORY

PIPE & EQUIPMENT AUCTION

Network International Inc

Sep 04, 2013 Sep 12, 2013

Internet

PIPE & EQUIPMENT SEALED BID

Network International Inc

Sep 11, 2013 Sep 18, 2013

Internet

PIPE & EQUIPMENT AUCTION

Network International Inc

Sep 18, 2013 Sep 25, 2013

Internet

No Lots are Currently Posted for this Auction

PIPE & EQUIPMENT AUCTION

Network International Inc

Oct 02, 2013 Oct 09, 2013

Internet

No Lots are Currently Posted for this Auction

PIPE & EQUIPMENT AUCTION

Network International Inc

Oct 16, 2013 Oct 23, 2013

Internet

No Lots are Currently Posted for this Auction

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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SEPTEMBER & OCTOBER

TOP

FESTIVALS AND EVENTS IN TEXAS All across Texas, a variety of festivals, events and attractions are a great way to have fun and to spend time with your family.

SEPTEMBERFEST September 6-8 “Return to Storyland” at Museum of the Southwest as it presents its 44th annual juried art festival. Enjoy live entertainment, artworks, festival foods & hands-on family fun in the KinderFest area. Festivities are located on the Museum grounds at 1705 W. Missouri Ave. For more information, call (432) 683-2882 or email info@MuseumSW.org

145TH ANNUAL WASHINGTON COUNTY FAIR September 13-21 - Brenham The “Oldest County Fair in Texas” features shows, rodeos, music and fun! Nashville entertainment, carnival, crafts, food, livestock and poultry auctions, commercial exhibits & attractions.

For more details, call 888-273-6426 www.washingtoncofair.com

SWIFT FEST 2013 September 7 – Jonestown Celebrate migratory Chimney Swift birds, which make Jonestown their seasonal home. The fest centers on the swifts’ evening return to their cistern home, which is a fascinating, tornado-like sight. Festivities include live jazz, swing, Americana & bluegrass music, as well as nature vendors & presentations, kid’s crafts & games.

(512) 339-9432 www.swiftfest.org

7th ANNUAL HUNTING EXPO September 13-14 - Crockett Exhibits at the Crockett Civic Center feature decoy carvers, collectors, eclectics, dealers, ATVs, UVs, feeders, blinds, hunting leases, taxidermy, gun repair, clubs, associations, The Texas Forest Service, Texas Parks & Wildlife, speakers and other activities including “Bling Lobby” for the ladies!

(936) 544-2359 www.crockettareachamber.org 20

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

29th ANNUAL KOLACHE FESTIVAL September 14 - Caldwell Downtown on the Courthouse Square. Enjoy kolaches, food & craft vendors, Czech bands, quilt show, Antique Tractor Show & car show. FREE. (979) 567-0000 www.BurlesonCountyTX.com HOPKINS COUNTY FALL FEST September 17-21 - Sulphur Springs Parade, Trades Day, Gospel Songfest, vendors, musical concerts, carnival, arts/crafts, quilt show, outdoor concerts, street dance, Cover Girl contest, tractor pull, junior livestock & 4-H horse shows, hot dog eating contests, golf tourney & more! Civic Center Grounds.

(903) 885-8071 www.VisitSulphurspringsTX.org www.hopkinscountyfallfestival.com 29th TEXAS STATE FOREST FESTIVAL September 18-22 - Lufkin All New Lumberjack Show, carnival, children’s events, Scout Fair, new car display, Family Music Fest, cheerleading & pom-pon/ dance competitions & much more! Henderson Expo Center.

For additional info, call (936) 634-6644 www.TexasStateForestFestival.com TEXAS PECAN FESTIVAL September 19-22 - Groves Queen’s pageant, treasure hunt, carnival, musical entertainment, cooking contest, pecan toss, pie-eating competition, craft & food booths and a parade.

(800) 876-3631 (409) 962-3631

COME AND TASTE IT Sept 19, Oct 17, Nov 21, Dec 19 - Gruene Historic District/ New Braunfels Meet Texas’ best winemakers & craft brewers at The Grapevine in Gruene Historic District on the third Thursday each month. Complimentary tastings of craft beer & three select wines, plus samples of food offered for sale. Event features live music & prize giveaways.

(830) 606-0093 www.GrapevineinGruene.com

LONE STAR HERITAGE QUILT GUILD’S 14TH ANNUAL QUILT SHOW September 20-21 - Sulphur Springs Enjoy a wide array of quilts, awards, door prizes, special displays, vendors & a quilt raffle. Civic Center Complex, 1200 Houston St. Admission $3; children under 12 free.

For more info, call (903) 994-2570 www.sulphurspringstxquilts.com

JUNIOR TEXAS WATER SAFARI September 21 - San Marcos This is a 16-mile race for young canoeists & kayakers held annually on San Marcos River the third Saturday of September. The adventure begins at City Park and ends in Staples. Registration is 8am at City Park. Free for spectators.

(888) 200-5620 www.toursanmarcos.com 33RD ANNUAL MEDINA LAKE CAJUN FESTIVAL September 28 - Lakehill “Home of the Great Gumbo Cook-off.” Saturday, 11am-10pm.

Lakehills Civic Center in Bandera County, 25 miles from San Antonio.

(830) 751-3130 www.cajunfestival-medinalake.com BLACK GOLD BASH - 5K MUD RUN September 29 - Odessa Mountain Bike Park - Presented by BUFFALO BATTLE Accept the challenge of crawling, running, jumping, climbing, wallowing in mud in a challenging competitive mood and then enjoying some good suds after Buffalo Battle at the Mountain Bike Park in Odessa, TX. Hwy 191 & Billy Hext Rd. Register at Active.com, by Sunday, Sept. 29 @ 10:01 am LET’S SHOOT ‘EM UP!!

October 5 - Midland Young Republicans Clay Shoot benefitting Centers for Children and Families. At Jake’s Clays, 13301 FM 1379, Midland, TX. 9am rotation and 1pm rotation.

To register or for more info call (432) 559-5567

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

21

AUCTIONS • PRIVATE SALES • APPRAISALS

22

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

AUCTIONS • PRIVATE SALES • APPRAISALS

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

23

BITES

by Moshe Vardi, Rice University

Source: www.thetexaseconomy.org

TECH

COMPUTERPROGRAMMING Computers?

ExCAPE project seeks computer-aided software design.

Information technology has been praised as a labor saver and cursed as a destroyer of obsolete jobs. But the entire edifice of modern computing rests on a fundamental irony: the software that makes it all possible is, in a very real sense, handmade.

Every miraculous thing computers can accomplish begins with a human programmer entering lines of code by hand, character by character.

That may change, however, due to an ongoing research project called Expeditions in Computer Augmented Program Engineering, or ExCAPE, which aims to use computers to assist human programmers in writing software.

ExCAPE, funded by a five-year, $10 million grant from the National Science Foundation, is led by researchers from the University of Pennsylvania and includes team members from Rice University, Cornell University, MIT, the University of California at Berkeley, UCLA, the University of Illinois at Urbana-Champaign, the University of Maryland and the University of Michigan. The ExCAPE team is seeking ways to use computers to aid the development of software and, ultimately, to teach computers to produce software based on our conversational commands.

“Today, when you write a program, you have to tell the computer exactly what to do and how to do it,” says Dr. Moshe Vardi, professor in computational engineering at Rice University and an ExCAPE participant. “Imagine you’re an executive and you tell your assistant, ‘this is what I want done’ — a good assistant will figure out how to get it done, without you having to spell it all out.

The software that makes modern computing possible is, in a very real sense, handmade.

“And that’s the level at which we want to be able to talk to computers,” Vardi says. “We want to be able to tell the computer, this is what needs to be done. You figure out how to do it. We want computers to learn from how humans write programs. We want them to be able to let us express ourselves 24

to them in a language that’s much closer to how we talk to each other.”

Obviously, we’re not there yet. But there are vital economic reasons for pursuing such improvements.

“Writing programs is incredibly labor-intensive and incredibly expensive,” Vardi says. “The world invests trillions of dollars in software. It’s been a mantra for years in the computing business — how to make programmers more productive, because programming is so expensive.”

ExCAPE teams are attempting to bring computer-aided programming to several real-world problem areas. Rice researchers are working toward developing the computational “engines” needed to translate commands into software, and to find applications in robotics.

“Part of the project is to develop technology so we can give robots instructions in high-level language,” says Vardi. “Right now, you have to program a robot in an excruciating level of detail. For example, robots that build cars — every movement has to be programmed. You can’t just tell them ‘put a screw in and tighten it.’ It’s almost like you have a little child and you have to tell it everything.”

Robots that could be “programmed” with simple verbal commands could find many applications.

“We could use robots for jobs that we find too difficult or too dangerous,” Vardi says. “We could have robot miners, for example. Or if a house collapses and we’re trying to get people out — imagine the firemen are robots, and if we lose one, we just pick another.”

Such robots would have to be much, much more intelligent than they are now, of course. Years of development lie ahead — but ExCAPE’s work is helping build a path toward that goal.

“We’re moving so slowly in part because of the need to program everything in such a detailed way,” Vardi says. “ If we could converse with machines in a high-level way, just as you and I converse, we’ll be able to make much more rapid progress.”

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

SAFETY TIPS Avoiding the Alternative of Using Short-Cuts The use of shortcuts has been a problem for a long time and continues to be a problem today.

Shortcuts like using cheater bars to tighten or loosen bolts and using wrenches as hammers have gotten a lot of people injured. Employees often times will try to get by with the tools they have even if it’s not the tool that they should be using for a particular task. When you use a tool improperly or for a task that it is not designed for, you are putting yourself and co-workers at a major risk of injury.

That tool can break and hit someone or slip and smash a finger.

Hand injuries are the most common type of injury in the Oil and Gas industry and a lot of the injuries are related to damaged, modified, or improper tool use.

When you modify a tool to perform a task for which it is not designed you are again putting yourself and co-workers at risk.

The bottom line is refusing to accept risk and Use The Right Tool For The Job. If you don’t have the proper tool to perform a task or if your tool has been damaged or modified, don’t do the task. Use Stop Work Authority and inform a Supervisor or someone that can get you the necessary tools to work safely before you go back to work.

Shawn Todd AMERICAN SAFETY SERVICES INC.

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

27

PBE NEWS BRIEFS WATCHING THE BASIN

DEVON PROFITS RISE (Reuters) - U.S. oil and gas producer Devon Energy Corp’s profit jumped 43 percent as higher production from its properties in Texas’ Permian basin boosted oil output by 14 percent.

Net profit rose to $683 million, or $1.68 per share, in the second quarter, from $477 million, or $1.18 per share, a year earlier.

The Oklahoma City-based company’s revenue rose about 21 percent to $3.09 billion.

Devon drills for oil, gas and natural gas liquids on land from the Canadian Arctic to the Gulf Coast in the United States.

WATCHING THE GOVERNMENT

ONLINE SERVICE IMPROVES PUBLIC ACCESS TO PETROLEUM AND NATURAL GAS DATA The U.S. Energy Information Administration (EIA) has added petroleum and natural gas time-series data to the agency’s application programming interface (API).

These high-value data sets add 127,000 time series, summarizing petroleum and natural gas production, consumption, inventories, prices, imports, exports, and sales data, to the API that EIA launched in October 2012.

The addition of petroleum and natural gas data builds on the API’s existing State Energy Data System (SEDS) and electricity data sets, allowing direct third-party computer access to 569,000 EIA data time series. This API data is ideal for software developers working in government, research, or the energy sector who are looking to design applications for the web or for mobile and tablet devices.

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“Expanding EIA’s API to include information on petroleum and natural gas production, consumption, and inventory trends brings us one step closer to the vision of making all of EIA’s data time series available through their powerful data access tools,” said EIA Assistant Administrator for Communications Gina Pearson.

Planned future additions to EIA’s API include comprehensive coal data sets and the Annual Energy Outlook data set. The API reflects EIA’s commitment to increasing the accessibility of its data through the use of machine-readable and open formats as outlined by the new federal Open Data Policy.

To get your free EIA API key and learn more, visit www. eia.gov/developer

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

WATCHING THE STATE

NEW LAW AIMED AT PROTECTING HIGHWAY DEPARTMENT WORKERS September not only brings the start of fall, but also the start of a new requirement for Texas drivers. The state’s Move Over/Slow Down law, which traditionally has required drivers to yield to police, fire and emergency vehicles, has now been expanded to provide that same protection for Texas Department of Transportation workers. Effective Sept. 1, drivers must move over or slow down when approaching TxDOT workers and vehicles that are stopped with overhead flashing blue or amber lights.

“We are very pleased the Legislature recognizes the dangers our employees face each day while working to maintain and build the state’s vast highway network,” said Phil Wilson, TxDOT’s executive director, noting that more than 100 TxDOT employees working in construction

areas have been struck and killed by motorists since 1938. “We are hopeful that this new protection for our crews will lead to fewer preventable deaths and injuries.”

The new addition to the Move Over law requires motorists to move out of the lane closest to the TxDOT vehicle when possible or reduce their speed to 20 miles per hour below the posted limit. If the road does not offer multiple lanes, the driver must slow down. On roadways with posted speed limits of 25 miles per hour or less, drivers must reduce their speed to 5 miles per hour. Violators can be fined up to $2,000.

Radio announcements and statewide billboards will help raise awareness of the new Move Over/Slow Down law. Source: www.txdot.gov

WATCHING THE NATION

GASOLINE AND DIESEL PRICES As the Labor Day weekend approached, the U.S. national average retail price for regular gasoline had fallen 13 cents per gallon below the apparent summer peak of $3.68 per gallon, reached on July 22. On Monday, August 26, it was $3.55 per gallon, despite an increase in crude oil prices since early July. At $3.55 per gallon, the average U.S. retail price for regular gasoline is 19 cents below last year’s price at that time and 3 cents below the level in 2011 leading into the holiday weekend. According to the American Automobile Association, gasoline prices were $3.59 per gallon August 29.

Prices for retail gasoline in the United States currently vary significantly by state and county.

Some of the highest gasoline prices in the United States are on the West Coast. However, a key part of the recent decrease in the U.S. average regular gasoline price has been the declining retail gasoline prices on the West Coast. According to EIA data, on August 26, the West Coast average retail price for regular grade gasoline was $3.75 per gallon; 21 cents per gallon lower than the $3.95-per-gallon average on July 22.

Source: U.S. Energy Information Administration, Weekly Retail Gasoline and Diesel Prices SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

29

WATCHING THE WORLD

SUPER PUMA HELICOPTER CRASH A Super Puma helicopter crashed into the North Sea late August killing four people. The helicopter flew from the Borgsten Dolphin rig to Sumburgh Airport in Shetland. 14 people were rescued from the water and survived the accident.

It is believed that the helicopter had a sudden loss of power but an investigation into the exact cause of the crash is still under way.

Parts of the helicopter are slowly being recovered by a Marine engineering company including the gearbox and rotor head, both engines and parts of the cockpit.

The search continues for the flight data recorder.

The Helicopter Safety Steering Group (HSSG) is meeting regularly regarding the incident and they’re still

30

discussing whether or not to review the suspension of all offshore flights by Super Puma helicopters.

Bob Crow, general secretary of offshore union RMT, said there was a lack of workforce confidence in the Super Puma type aircraft, and unions had been working with the industry to address their members concerns.

Speaking after a meeting in Aberdeen, Oil and Gas UK Chief Executive, Malcolm Webb, said a number of options are being considered to transport workers while the Super Pumas are out of service.

This is the fifth Super Puma incident in the North Sea in four years. Previous incidents include two in 2009 and two in 2012.

Source: BBC

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

WATCHING OFFSHORE

DRILLING TO BEGIN THIS MONTH OFF OF CARIBBEAN COAST Noble Energy is planning to start drilling offshore near the town of Puerto Cabezas in the Nicaraguan Caribbean, home to one of the largest barrier reefs in the world.

Energy Minister Emilio Rappaccioli said Noble Energy would begin exploratory work at the Old Providence barrier reef this month.

The US company can operate under a government concession. President Daniel Ortega commented “We have allocated blocks for exploration in the search for oil and gas in the territories as defined by the the International Court of Justice” as the court extended Nicaragua’s sea boundaries last year.

The area was granted to Nicaragua in November after a decades-old dispute with Colombia.

A company official said that Noble Energy is expected to invest from $90 million to $300 million during the exploration phase. If oil is found, production could reach one billion barrels of oil. The exploration phase has a 25 percent probability of success. However, activists say the project will harm the environment of the area.

Last year the International Court of Justice (ICJ) in The Hague rejected Nicaragua’s claims to a group of islets in the Caribbean but extended its sea boundaries.

The decision gave Nicaragua more access to fishing grounds as well as reported underwater oil and gas deposits.

Government spokeswoman Rosario Murillo said the initial drilling, by Noble Energy, would take place about 168km (104 miles) offshore.

The Old Providence reef is one of the largest barrier reefs in the Americas and campaigners warn that the exploratory drilling will damage its fragile environment.

Colombia strongly disagreed with the extension of Nicaragua’s sea boundaries.

However, the ICJ ruling is binding.

Nicaragua and Colombia signed a treaty in 1928 to settle the border and sovereignty of islands in the Caribbean.

But in 1980, Nicaragua’s Sandinista government unilaterally annulled the agreement, arguing that it had been signed under US pressure.

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

Cares

Gary Allan rocks Midland

Gary Allan West Texas native Alyssa Bagley opens up the night.

Concho West Texas Drum

Basic Energy

Top talent like Selena and Tracy Lawrence kicked off the concert

Apache series when it began in an effort to bring great entertainment to the Basin and help support the local community. The concerts continued when the new Citibank Ballpark opened in 2002 bringing artists like Dwight Yoakum, Brad Paisley, Clay Walker and this year’s performer, Gary Allan. Partial proceeds from the events went to support the Red Cross for several years in an effort to help pump funds back into a vital organization that was instrumental in West Texas during several destructive fires.

Since the late 80’s, top artists have been hitting the outdoor stage in Midland bringing a big-city concert experience that is one of a kind in the Permian Basin. Miles Prentice and Bob Richmond bought the RockHound’s franchise in 1989 and almost immediately decided to use the then ballpark, Christensen Stadium, for more than just baseball.

This year’s late August concert brought over 5,000 people out to the ballpark for the evening event and raised over $20,000 for the local YMCA. RockHound’s General Manager Monty Hoppel says he believes the outdoor concert experience coupled with well-known artists is what makes this event so popular and widely attended by both sponsors and individuals who come every year. Hoppel notes that the great attendance has also helped secure more big-name talent due to the event’s reputation. Top sponsors for this year’s concert included Apache, West Texas Drum Company, Basic Energy and Concho.

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

33

RESTAURANT

BITES

by Marcy Madrid

“Don’t change anything, but change everything”.

At the time, it was the most confusing advice the new owners of Jersey Girl Pizza had ever heard, but looking back it’s beginning to make sense. Brothers, Teak-Allen and Charlie Barry, known to many around Odessa as ‘Teak and Charlie’, were looking to get out of their construction business when the opportunity to buy the then, 6 year old Pizzeria came about in 2010.

Teak notes this comment, coming from a long time customer right after they took over, as one that has stuck in his head. What Teak and Charlie soon learned about this tucked away pizza joint was that it had a reputation for delicious, east coast style pizza. That was what the customers didn’t want to see changed. However, the brothers’ voice-tress and expressive personalities soon began to leak other changes into the restaurants culture, and those changes were exactly what people were looking for. As soon as customers walk into the front door they’re greeted by a loud “Hello!”

34

from behind the counter. If they happen to mention it’s their first time, another call out comes from the register signaling a free order of garlic knots for the newcomers. Teak said they wanted to capture the essence of an east coast-style pizzeria and that meant being a little loud, greeting customers like old friends and sometimes being a little obnoxious.

Above all, Teak says, it’s about creating a unique experience and taking care of the customer.

When asked what it was like going from a construction business to a restaurant, the brothers both said it was essentially the same concept: you take raw materials and put them together to make something to please people.

Their raw materials changed from lumber and nails that built houses to dough and cheese that built home-cooked meals, but the idea is the same; create a great product and take care of people and they will take care of you.

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

The casual and fun east coast flavor is not only plastered all over the walls and imbedded in the attitude of the employees, but it’s also evident in the extralarge, gourmet slice of ‘pie’ served here. The conversation with a very casual and laid back Teak quickly turned serious as he explained to me that this was not fast food pizza, rather a real, fresh, home-cooked meal. “This is dinner”, he said. And he wasn’t kidding.

My experience with the Margarita far surpassed any pizza I’ve had in a long time and it was certainly worth the few extra dollars. I asked Teak what made him and his brother such good cooks, and with a glimpse down and a smile on his face he said, “Look at me, I love food.” His comment reminded me of the old saying,‘Never Trust a Skinny Cook.’ By the way, Teak said their construction experience came in handy from the start when they had to widen the kitchen to make room for the brand new, not-soskinny cooks.

Teak & Charlie’s Jersey Girl Pizza

4007 John Ben Shepperd Pkwy Odessa, TX Phone: (432) 366-2000 www.jgpizza.net Delivery Available. The largest pizza served is a 30-inch 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE & theSEPTEMBER most popular is the Meat Lovers.

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Inspires Emotional God?

The following is a prophetic word spoken by Pastor Jim Laffoon during a recent Wednesday night church service at MidCities Church, in between Midland and Odessa.

by Daniel Stephens Emotions are a funny thing. A while back I was sitting on the couch with Kayla watching TV. She had the remote (because she got there first) and was watching a movie on Lifetime. Let me just say, any movie on Lifetime is a B movie at best. I glanced at the clock and noticed that the movie only had about 10 minutes until it’s sappy ending. As I was thinking about how I could distract her from the remote so I could nonchalantly switch it to the Spurs game, I looked over and saw tears on her cheek. What? This is a Lifetime movie! Don’t give them your tears! So I did what any good husband would do… I scolded her for wasting her emotions and we laughed which caused enough of a distraction to steal the remote. ;-) The truth is, we are emotional creatures.

We get mad when someone pulls out in front of us. We get frustrated when the convenience store with its convenient pumps doesn’t refill the receipt tape and you have to walk inside anyway. We rejoice with friends who have desired, and prayed for a child, received the 36

Daniel Stephens is the Senior Pastor of Mid-Cities Community Church, since 2006. He is the honored husband to Kayla Stephens, a proud father of twin sons Jonah & Jude, daughter Kampbell, and a precious foster daughter.

news that new life was coming soon!

We watch a dodge truck commercial during the Super bowl about a farmer that conjures up images of grandpas, uncles, and dads, eliciting tears of appreciation and American sentimentality. Whether it is sorrow or joy, pain or relief, emotions are a very real part of our daily lives.

This should be no surprise when we consider that mankind was made in the image and likeness of God. Literally, we were made like him, as representatives of Him on earth. God, Himself has emotions. Now, don’t get me wrong, God is not an emotionally unstable celestial being.

He is not needy nor does he have “issues”, but he does have emotions.

In the eleventh chapter of Hosea, God is talking about Israel and his love for them, how He loved and cared for Israel and yet Israel rejected God and worshiped false idols. This particular passage is filled with emotional language.

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

Throughout the Bible God displays His emotions, joy, sorrow, compassion, anger, jealousy, and even disappointment.

We don’t have difficulty understanding that God has emotions but where we often get it wrong is what we believe His primary emotion towards us is that of disappointment or anger. We are always failing him and never getting it right. A couple months ago, I was at my four-year old daughters’ dance recital. Before her group came out to dance, several other groups of miniature ballerinas performed.

One of those groups that came out on stage had a little dancer who was completely terrified as soon as she hit the stage. Tears began to flow as she looked desperately for mom and dad as the music began. Feeling for this little girl, all of us in the audience were silently rooting for her to visually locate her mom and dad to settle her distressed spirit.

Finally, she sees her parents but that doesn’t help. In fact she began to cry even more as she stretched her petite arm towards them. Out of the corner of my eye I saw a man, I assumed was her dad, come down right in front of the stage. As the music continued, he smiled at his teary eyed girl and mouthed the words to the song as he did the motions with his arms inviting her to join him. She stopped crying. Slowly she began to do the motions, then the dance, and then she began to sing the song. He stayed up front on one knee encouraging her, maintaining eye contact the entire time until the song was finished.

As I sat there, I couldn’t help but think. This is the kind of God we have. When we mess up and cry on the stage of our lives, he doesn’t scold us or reprimand us. He comes to the front, kneels down, maintains eye contact and helps us through it. Scripture says he loved the world so much he gave his Son to provide eternal life for those who believe in him. I don’t think God’s primary emotion towards his children is disappointment. It is love.

Follow Daniel on Twitter: @DanielBstephens

FISHING & RENTALS

FISHING & RENTAL TOOLS REVERSE UNITS FOAM/AIR UNITS

1511 Garden City Hwy • PO Box 150

MIDLAND TEXAS

432.684.3898 SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

37

U.S. RIG COUNT - TEXAS

States &

August 29, 2013

BAKER HUGHES RIG COUNT

RIGDATA RIG COUNT

Four Week Average 2012

Four Week Average 2013

Last Week

This Week

Four Week Average 2012

Four Week Average 2013

Last Week

This Week

Waiting to Spud

Texas RRC District 1

141

140

135

140

147

130

131

125

13

Texas RRC District 2

87

82

81

81

83

81

79

85

11

Texas RRC District 3

46

45

45

49

51

45

49

46

5

Texas RRC District 4

40

38

38

35

35

28

25

27

2

Texas RRC District 5

16

15

14

14

17

15

15

14

0

Texas RRC District 6

29

28

28

30

26

31

32

32

1

Texas RRC District 7B

15

18

20

18

26

21

20

21

3

Texas RRC District 7C

79

79

79

78

78

79

74

77

4

Texas RRC District 8

318

269

268

268

299

260

262

265

9

Texas RRC District 8A

32

40

42

38

34

39

33

37

1

Texas RRC District 9

28

18

18

17

39

32

30

29

4

Texas RRC District 10

72

70

70

72

73

77

74

79

1

Texas Total

903

842

838

840

908

838

824

837

54

U.S. Totals

1,920

1,786

2,078

1,948

1,931

1,940

92

Districts

1,791 1,776

COPYRIGHT Š 2013 RIGDATA P.O. Box 820547 Fort Worth Texas 76182-0547 1-800-627-9785 | www.rigdata.com This report is protected under United States and international copyright laws and is intended for the exclusive use of the subscriber. Any unauthorized reproduction, retransmission, distribution, publication, broadcast or circulation of this report to anyone, directly or indirectly, without the express prior written consent of RIGDATA is prohibited. To order additional report copies at a reduced rate or for a corporate site license, please contact: 1-800-627-9785 38

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

TOP 35 DRILLERS RANKINGS Each month we track the activity of all the drillers and compile the results into a report that identifies the top 35 out of 100 drillers based on their footage drilled. Updated monthly, these reports also detail the number of well starts and the number of directional wells drilled by each of the top 35 out of 100. through August 29, 2013 Company

Footage Drilled

% of Total

Average Footage

Well Starts

% of Total

Directional Wells

1

Helmerich & Payne, Inc.

29,280,185

16.40%

10,174

2,878

12.60%

2,524

2

Patterson-UTI Drilling Company, LLC

17,782,711

10.00%

9,940

1,789

7.80%

1,516

3

Nabors Industries, Ltd.

15,313,398

8.60%

7,861

1,948

8.50%

1,718

4

Precision Drilling Trust

8,011,313

4.50%

9,315

860

3.80%

767

5

Ensign Energy Services, Inc.

7,423,794

4.20%

5,958

1,246

5.50%

675

6

Nomac Drilling, LLC

6,714,452

3.80%

9,326

720

3.20%

717

7

Trinidad Drilling, Ltd.

5,002,741

2.80%

10,713

467

2.00%

390

8

Pioneer Energy Services Corp.

4,940,986

2.80%

9,429

524

2.30%

371

9

Unit Drilling Company

4,429,854

2.50%

7,939

558

2.40%

544

10

Cactus Drilling Company, LLC

4,195,070

2.40%

10,540

398

1.70%

369

11

Savanna Energy Services Corp.

3,796,344

2.10%

10,373

366

1.60%

130

12

Capstar Drilling, LP

3,783,567

2.10%

6,615

572

2.50%

99

13

Desoto Drilling, Inc.

2,491,569

1.40%

4,364

571

2.50%

569

14

Xtreme Drilling and Coil Services Corp.

2,457,442

1.40%

9,525

258

1.10%

249

15

Complete Production Services, Inc.

1,995,617

1.10%

9,978

200

0.90%

66

16

Sendero Drilling Company, LLC

1,880,019

1.10%

11,605

162

0.70%

0

17

CanElson Drilling, Inc.

1,761,939

1.00%

9,789

180

0.80%

27

18

Union Drilling, Inc.

1,526,526

0.90%

10,528

145

0.60%

56

19

Robinson Drilling of Texas, Ltd.

1,520,285

0.90%

11,179

136

0.60%

1

20

Lariat Services, Inc.

1,509,501

0.80%

6,479

233

1.00%

113

21

Cyclone Drilling, Inc.

1,479,271

0.80%

5,066

292

1.30%

280

22

Orion Drilling Company, LLC

1,479,173

0.80%

11,378

130

0.60%

124

23

Latshaw Drilling & Exploration Company

1,428,129

0.80%

7,400

193

0.80%

189

24

Scandrill, Inc.

1,388,690

0.80%

12,181

114

0.50%

91

25

SST Energy Corporation

1,212,258

0.70%

9,471

128

0.60%

105

26

Big Dog Drilling Company

1,148,417

0.60%

11,719

98

0.40%

8

27

Sidewinder Drilling, Inc.

1,110,364

0.60%

5,608

198

0.90%

198

28

Lewis Petro Properties, Inc.

1,107,500

0.60%

12,170

91

0.40%

91

29

Basic Energy Services, Inc.

1,103,685

0.60%

6,730

164

0.70%

39

30

Bison Drilling and Field Services, LLC

997,296

0.60%

11,081

90

0.40%

10

31

Silver Oak Drilling, LLC

939,865

0.50%

7,767

121

0.50%

50

32

Aztec Well Servicing Co.

847,430

0.50%

6,469

131

0.60%

65

33

Murfin Drilling Company, Inc.

844,720

0.50%

4,667

181

0.80%

0

34

ProPetro Services Incorporated

840,450

0.50%

11,513

73

0.30%

0

35

Mattlock Drilling, LP

814,500

0.50%

12,727

64

0.30%

0

Total Top 100 for year 2013

178,085,831

100.0%

---

22,841

100.0%

---

RANK

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

39

TOP 35 OPERATORS RANKINGS Updated every month, we track and rank the top

35 out of 100 operators based on their footage drilled.

Keep track of the most active operators with details on their number of well starts.

through August 29, 2013

RANK

Company

Footage Drilled

% of Total

Average Footage

Well Starts

% of Total

Directional Wells

1

Anadarko Petroleum Corporation

9,628,364

5.40%

10,189

945

4.10%

920

2

Chesapeake Energy Corporation

7,543,633

4.20%

10,250

736

3.20%

736

3

EOG Resources, Inc.

6,323,992

3.60%

10,558

599

2.60%

565

4

Apache Corporation

5,955,905

3.30%

8,863

672

2.90%

311

5

Devon Energy Corporation

5,894,399

3.30%

9,167

643

2.80%

590

6

Occidental Petroleum Corporation

5,389,255

3.00%

6,090

885

3.90%

427

7

Pioneer Natural Resources Company

5,274,050

3.00%

12,990

406

1.80%

223

8

BHP Billiton

5,236,831

2.90%

13,158

398

1.70%

390

9

Marathon Oil Corporation

3,635,208

2.00%

14,090

258

1.10%

258

10

Encana Corporation

3,583,459

2.00%

10,602

338

1.50%

322

11

Exxon Mobil Corporation

3,361,841

1.90%

6,737

499

2.20%

315

12

Concho Resources, Inc.

3,275,235

1.80%

10,172

322

1.40%

123

13

Southwestern Energy Company

3,044,443

1.70%

4,620

659

2.90%

657

14

Chevron Corporation

3,012,152

1.70%

4,456

676

3.00%

259

15

ConocoPhillips Company

2,884,928

1.60%

8,243

350

1.50%

268

16

Royal Dutch Shell, plc

2,647,523

1.50%

13,508

196

0.90%

193

17

QEP Resources, Inc.

2,527,241

1.40%

9,950

254

1.10%

243

18

Whiting Petroleum Corporation

2,372,488

1.30%

9,341

254

1.10%

202

19

Noble Energy, Inc.

2,136,423

1.20%

9,711

220

1.00%

216

20

SandRidge Energy, Inc.

2,006,103

1.10%

5,252

382

1.70%

283

21

Energen Resources Corporation

1,854,200

1.00%

8,788

211

0.90%

31

22

Newfield Exploration Company, LLC

1,780,636

1.00%

6,745

264

1.20%

248

23

CrownQuest Operating, LLC

1,701,900

1.00%

12,070

141

0.60%

0

24

Continental Resources, Inc.

1,600,401

0.90%

4,125

388

1.70%

387

25

Murphy Oil Corporation

1,578,076

0.90%

9,925

159

0.70%

157

26

EP Energy E&P Company, LP

1,519,285

0.90%

10,129

150

0.70%

134

27

Oasis Petroleum North America, LLC

1,495,991

0.80%

9,973

150

0.70%

149

28

Linn Energy, LLC

1,359,579

0.80%

8,660

157

0.70%

52

29

Parsley Energy Operations, LLC

1,245,300

0.70%

12,972

96

0.40%

0

30

WPX Energy, Inc.

1,216,348

0.70%

7,113

171

0.70%

169

31

BP, plc

1,180,310

0.70%

10,175

116

0.50%

114

32

Cimarex Energy Co.

1,171,011

0.70%

10,743

109

0.50%

101

33

SM Energy Company

1,157,760

0.70%

7,823

148

0.60%

142

34

Plains Exploration & Production Company

1,137,898

0.60%

6,465

176

0.80%

80

35

Lewis Energy Group, LP

1,116,500

0.60%

12,136

92

0.40%

92

Total Top 100 for year 2013

178,085,831

100.0%

---

22,841

100.0%

---

40

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

Source: www.eia.gov

EIA EXPECTS BRENT PRICES TO DECLINE THROUGH END OF 2013 DESPITE CURRENT SUPPLY DISRUPTIONS Last weekend, many soccer fans in the United Kingdom and elsewhere focused their attention on the start of the new season of the Barclays Premier League (BPL), one of the top leagues in the world. But the BPL opening day was not the only item of global interest in the United Kingdom. Petroleum analysts throughout the world also noticed recent increases in the price of Brent crude oil.

Disruptions to global crude oil and liquid fuels production reached nearly 2.7 million barrels per day (bbl/d) in July 2013 (Figure 1), the highest level since at least January 2009. During this same period, global refinery crude oil runs reached their expected 2013 peak. Combined, these developments helped push Brent spot prices to an average of $108 per barrel in July, above the $102-$103-per-barrel average from April through June.

However, this upward price movement was likely muted in part by growing non-OPEC supply in other regions, including growing U.S. production that has reduced U.S. imports of crude oil and in so doing released more barrels from global suppliers to other markets. Through the end of the third quarter and into the fourth quarter, EIA expects that continued rising nonOPEC production combined with seasonally decreasing demand from refiners will put downward pressure on Brent prices. In the August Short-Term Energy Outlook (STEO), EIA projects the Brent spot price will average $104 per barrel in September, and $102 per barrel in the fourth quarter.

summer, reducing crude supplies, particularly into the Mediterranean market, an important market for Brentpriced crude oils. In Iraq, persistent attacks on the pipeline from Kirkuk to Ceyhan in Turkey helped push total Iraqi production disruptions to about 290,000 bbl/d in July, up 60,000 bbl/d from June. In Libya, ongoing labor-related protests at several oil production facilities boosted outages, thereby reducing production to 1.0 million bbl/d in July, down from 1.5 million bbl/d in April. Additional deterioration in the security environment in Iraq or Libya could further reduce OPEC production in the short term. In Nigeria, crude exports were reduced during July and August as deliveries of the country’s Bonny Light grade were disrupted by work on key pipelines.

Outages in non-OPEC member countries as well as record-high global refinery runs also tightened crude supplies and contributed to higher crude oil prices. The International Energy Agency (IEA) reported that global

Disruptions to production in Iraq and Libya have had a significant effect over the SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

41

refinery runs were 78.3 million bbl/d in July, up from an average of 74.8 million bbl/d in the second quarter.

The IEA expects global runs to remain at a fairly hefty 77.4 million bbl/d in August. From a supply standpoint, disruptions to non-OPEC production averaged about 800,000 bbl/d, most of which occurred in Sudan and South Sudan, Yemen, and Syria, and which were largely already priced into market expectations. However, unanticipated flood-related disruptions in Canada, mostly affecting North American inland markets, contributed almost a quarter of the total non-OPEC outages.

to Brent. Yet, there is still uncertainty in the price forecast.

Trade press has reported recently that labor strife in Libya has yet to subside and that maintenance at the port of Basra could further reduce Iraqi exports in September, though such reports have been disputed by the Iraqi government. Any increase in production outages could put upward pressure on Brent prices. At the moment, however, EIA expects reduced refinery demand and rising supply to largely offset existing outages and bring Brent prices within the $102-$104-per-barrel range, closer to levels seen earlier in 2013.

The tightness in light sweet crude oil supply resulting from the combination of production outages and increased refinery runs is most readily apparent in the absolute price levels of Brent crude oil. However, it is also evident in the Urals differential, the price of Urals crude oil compared with that of Brent. Urals, a Russian crude oil, competes in European markets with many Brent-priced crude oils. The Urals differential for crude oil delivered into the Mediterranean market moved from an average $0.48 per barrel below Brent in June to an increasingly larger premium to Brent for much of July and the first weeks of August, reaching a $2.76-perbarrel premium versus Brent on August 8. The Urals price was also supported by high refinery runs in the former Soviet Union, mostly Russia, which increased from 6.2 million bbl/d in April to 7.1 million bbl/d in August, reducing supplies available for export.

Gasoline price decreases while diesel fuel increases

In September, an expected reduction in refinery purchases of crude oil should help to relieve upward pressure on prices even as production outages continue.

The IEA expects global crude oil runs to fall to 76.2 million bbl/d in September and to 75.9 million bbl/d in October. As refiners typically schedule crude purchases one to two months in advance of actual processing, short-term refiner demand for crude is likely to taper off.

Likewise, EIA projects non-OPEC liquid fuels production, predominantly crude oil, will increase through the end of 2013, with fourth-quarter production averaging 55.0 million bbl/d, increases of 0.7 million bbl/d and 1.3 million bbl/d from the third and second quarters of 2013, respectively.

While crude oil prices have drifted modestly upwards in August, with Brent trading at about $110 per barrel on August 21, it is likely that reduced crude buying has blunted the continued effects of production outages.

This is already evident in the Urals differential in the Mediterranean, where Urals is again trading at a discount 42

The U.S. average retail price of regular gasoline decreased one cent to $3.55 per gallon as of August 19, 2013, 19 cents lower than last year at this time. Prices decreased in all regions except the Midwest, where the price increased two cents to $3.50 per gallon. The largest decrease came on the West Coast, where the price fell six cents to $3.78 per gallon. The East and Gulf Coast prices both fell two cents, to $3.55 per gallon and $3.37 per gallon, respectively. Rounding out the regions, the Rocky Mountain price declined a penny to $3.64 per gallon.

The national average diesel fuel price increased less than one cent to remain at $3.90 per gallon, 13 cents lower than last year at this time. Prices increased one cent in both the Midwest and on the West Coast, to $3.87 per gallon and $4.06 per gallon, respectively. On the East Coast, diesel fuel remains at $3.91 per gallon, up less than a penny from last week, and the Gulf Coast price remains at $3.82 per gallon, down less than a penny from last week. Rounding out the regions, the Rocky Mountain price decreased one cent to $3.92 per gallon.

Propane inventories slightly higher Total U.S. inventories of propane rose slightly from last week to remain at 61.9 million barrels, but are 9.1 million barrels (12.8 percent) lower than the same period a year ago. Midwest inventories gained by 0.1 million barrels, while Rocky Mountain/West Coast and East Coast inventories increased slightly. Gulf Coast inventories decreased by 0.1 million barrels. Propylene non-fuel-use inventories represented 4.7 percent of total propane inventories.

PERMIAN BASIN ENERGY MAGAZINE | www.PBEMag.com | SEPTEMBER 2013

SEPTEMBER 2013 | www.PBEMag.com | PERMIAN BASIN ENERGY MAGAZINE

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