points of interest president’s letter...volume 14, issue 5 june 2016 president’s letter aapl...
TRANSCRIPT
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VOLUME 14, ISSUE 5 JUNE 2016
President’s LetterAAPL Events 3
New Members 4
Questions from the 4field
Energy Industry 6 Industry Affairs 7-10
Legislative Affairs 11,12
WTO 13-15
Fishing Tournament 16-18
Shocking as it may be, those that are close to me know that I am not what you would call an “outdoorsman.” My typical forays into the great outdoors consist of lining up a putt on a meticulously manicured green or standing in the coach’s box at 3rd base during my daughter’s softball games. While I enjoyed the few occasions I’d fished as a kid, I’d never attended the OCAPL Fishing Tournament. Let’s just say, if you found me in the fishing department at Bass Pro, I was probably lost and looking for the restroom.
This year was my first to attend the tournament. I want to thank David Graham and his committee for another successful event. Be it at the prize drawing, on a fishing boat, cooling off after a round of golf, or watching the Thunder game, there were plenty of networking opportunities. Other than the Rocky Mountain Spotted Fever I contracted from a tick, I had a great experience. Yes, I did get RMSF. Yes, I’m fine.
From one great event to the next, Bhavin Naik and his committee put together another excellent golf tournament. Despite the downturn, both tournaments were a huge success. While I didn’t win one of the many trips, televisions, or the long drive (missed it by only 183 yards), I did get the opportunity to network and meet some of my peers in the industry. A special thank you to our sponsors for these two events and all OCAPL
functions. Our events are some of the finest in the industry, and we absolutely could not do it without their support.
At the writing of this letter, oil is slightly over $50. Things may finally be creeping in the right direction. Please continue to do the right things as our industry works towards a recovery. I encourage you all to further branch out and network; continue to operate with the utmost of integrity and work to improve your skillset and education.
Our next Monday Night Meeting and Educational Luncheon will be on September 12th. We’re over the hump for 2016. Make sure you note the following events for the second half of the year:
• Sporting Clays on August 26th • Weekend Take Off on September 23rd through September 25th • Landman Fun Run on October 23rd
Please be safe this summer. If your summer adventures do involve a tick bite for you or a loved one, I can now personally vouch that you consider having it checked out by a doctor. I will report back from the AAPL Annual Meeting in my next letter.
Sincerely,Nick Watkins, CPL2016 OCAPL President
Points of Interest
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Aug. 26th
Sep. 12th
Sep. 23rd-25th
Oct. 3rd
Oct. 23rd
Nov. 7th
Dec. 5th
*SUMMER BREAK*
Sporting Clays Tournament - Register Online
Educational Luncheon – Speaker TBAMonday Night Meeting – Social Meeting – No Speaker
Weekend Take Off-Beavers Bend State Park, Broken Bow, OK – Register Online
Educational Luncheon – Speaker TBAMonday Night Meeting – Speaker – C. Michael Ming, General Manager of General Electric’s Global Research Oil & Gas Technology Center and Former OK Secretary of Energy
Fun Run - Regatta Park, Boathouse District
Educational Luncheon – Speaker TBAMonday Night Meeting – Awards Night
Christmas Party
*GO TO WWW.OCAPL.ORG TO REGISTER FOR EVENTS*
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Sign Up Now!
Oil and Gas Land Review, CPL/RPL Exam - Oklahoma City, OK 8/16-8/19/2016
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Questions from the Field
Timothy C. DowdELIAS BOOKS BROWN & NELSON
Editor’s Note: Each month this column will be de-voted to answering oil and gas title questions.
Q: I have a situation where there was a lease to OLD Oil Company that had an option to extend. OLD Oil Company did not file notice that the option had been exercised. My com-pany, NEW Exploration, Inc., checked title. During the primary term of the lease term, the original lessor A had conveyed their mineral interest to a new mineral owner Z. NEW Exploration, Inc. contacted the new mineral owner Z after the primary term had expired and took a lease from him (Z). The new mineral owner also furnished NEW with an affidavit of non-payment stating that they had not received payment for the option.
Fast forward a year down the road. OLD Oil Company apparently did exercise the option and sent payment to the original mineral owner, A, who, at the time, was not the min-eral owner. Further, OLD never filed an affidavit stating that the lease was extended. Whose lease is valid – OLD or NEW? – M.F.
Questions from the FieldTimothy C. Dowd
ELIAS BOOKS BROWN & NELSON
Editor’s Note: Each month this column will be devoted to answering oil and gas title questions.
Q: I examined an Oil and Gas Lease dated July 1, 1984, covering tracts in Sections 1, 2, 3, 4, 5 and 6. I have also examined copies of Oklahoma Corporation Commission Completion Reports (Form 1002) for the Smith 1-1 Well drilled in the SE/4 and the Smith No. 2 Well located in the NE/4 of Section 1.
During the primary term of the lease, two wells were drilled on the lands in Section 1. The first well, which is denoted as the Smith 1-1 Well, was commenced on October 13, 1984 and drilled in the S/2 SE/4 (which is not part of the leased tract). The Smith 1-1 was completed in a formation, which was established as a 160-acre drilling and spacing unit for the SE/4.
A second well, denoted as the Smith No. 2 Well, was drilled in the NE/4 of Section 1 (part of the leased tract) on April 24, 1986, and completed in the Hartshorne formation. The Hartshorne formation has not been established as a drilling and spacing unit for the NE/4 of Section 1.
Does the drilling of the Smith 1-1 Well in a drilling and spacing unit of 160-acres cause the lease to terminate outside the SE/4? What is the impact of the Smith No. 2 Well Well on the extension of the Smith 1-1 lease?
A: Title 52 O.S. 87.1(b) recites: "In case of a spacing unit of one hundred and sixty (160) acres or more, no oil and/or gas leasehold interest outside the spacing unit involved may be held by production from the spacing unit not more than ninety (90) days beyond expiration of the primary term of the lease." (This statute is frequently described as the “Statutory Pugh Clause”).
Unfortunately, there is no case law and only one law review article that construes this statute and its impact on wells drilled. The only guidance is the wording of the statute. In this situation the oil and gas lease would not have been extended solely by virtue of production from the spacing unit and the well drilled in the SE/4, but the lease was
AAPL MEMBER *
* Rick Lee Dudley Land Company [email protected]
* Brian Shelton Abadie & Schill [email protected]
* Jeovani Vela Dawson Geophysical Company [email protected]
Wesley Hulse Beckmen Law, P.C. [email protected]
* Andrew Rische Anadarko Minerals, Inc. [email protected]
* Brian Pedicord Purple Land Management [email protected]
* Jack Clark J.C. Land Management, Inc. [email protected]
Jeremy James Ball & Morse [email protected]
* Benjamin Holliday Mazurek & Holliday P.C. [email protected]
* Kevin Dickerson Orange Energy Corporation [email protected]
* John Seikel Seikel Oil & Gas, LLC [email protected]
* D. Flurry HighMark Energy Operating, LLC [email protected]
A: Unfortunately, for NEW, based on what we know from the facts presented, it appears that the prior lease is valid.
There are two legal issues involved. The first is when there is a lease with an option, a third party has a duty to inquire of the mineral owner to determine whether the option has been extended. As NEW does not know and cannot be cer-tain whether OLD was made aware of the conveyance from A to Z, then he must make inquiry of the prior owner, A, in addition to the new mineral owner, Z.
The second issue is that almost all modern oil and gas leases have a change of ownership clause that requires any new mineral owner to notify the lessee of change of ownership. Therefore, Z, the second mineral owner, had the duty to notify OLD of a change of ownership.
If no change of ownership was provided to OLD, then OLD took what appears to be the proper action by paying the presumed mineral owner the option money to extend. How-ever, if it can be proven that Z notified OLD of the change of ownership, and OLD did not pay the correct party, then it would appear that the new or second lease would be the supe-rior lease. Note: If you have any title questions you want answered, email your questions to [email protected].
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AAPL MEMBER *
* Rick Lee Dudley Land Company [email protected]
* Brian Shelton Abadie & Schill [email protected]
* Jeovani Vela Dawson Geophysical Company [email protected]
Wesley Hulse Beckmen Law, P.C. [email protected]
* Andrew Rische Anadarko Minerals, Inc. [email protected]
* Brian Pedicord Purple Land Management [email protected]
* Jack Clark J.C. Land Management, Inc. [email protected]
Jeremy James Ball & Morse [email protected]
* Benjamin Holliday Mazurek & Holliday P.C. [email protected]
* Kevin Dickerson Orange Energy Corporation [email protected]
* John Seikel Seikel Oil & Gas, LLC [email protected]
* D. Flurry HighMark Energy Operating, LLC [email protected]
OIL & GAS ATTORNEYSACQUISITIONS & DIVESTITURESASSET EVALUATIONEXPLORATION & PRODUCTIONINTEGRITY. COMPETENCE. VISION.
"Work hard and be nice to people."
2015 Tax Info
Page 6 Price Magazine | 11
From an energy student’s
perspective, it’s a little scary out
there. As a freshman back in 2012,
when I decided to major in energy
management, the atmosphere
was completely different. Both Brent and
WTI crude oil were over $100 a barrel and
business was booming.
At the beginning of 2016, we saw
oil below $30 a barrel, but that is just
the nature of the industry. The oil and
gas industry is cyclical because it is a
commodity. Due to the fall in prices,
companies have had to endure massive
layoffs just to stay afloat, therefore
increasing competition in the industry as
well as in universities that have energy
management programs.
Since joining the Robert M. Zinke
Energy Management Program at Price
College, I have had the opportunity to see
the passion of the people in the energy
industry. In downturns such as the one
we are experiencing now, only the people
who have a real love for the industry will
stay and ride it out, and I have seen that
first-hand through the leadership of Steve
Long, director of the energy management
program. He has worked tirelessly to
make sure that all students have the best
opportunities for internships and full-time
placement.
One example in which Long has given
students an opportunity to secure full-time
placement and make connections is when
he took 32 graduating seniors to the North
American Prospects Expo in Houston.
Historically, this was an opportunity given to
juniors that had secured an internship and
was sponsored by the company for which
they would work.
“Due to the change in the market, we
felt it was important to reward our seniors
who have been active in the program
for four years,” said Long. “These seniors
earned the right to go and spend their
time at the conference, marketing the OU
program while generating internship and job
opportunities for their classmates.”
I was fortunate enough to be one
of the seniors selected, and it was an
amazing experience to meet other industry
professionals and expand my network.
So yes, the industry isn’t all that great
right now. Yes, companies are having
layoffs. Yes, gas is really cheap at the
moment. But, I’m not as worried as others
outside of the OU energy management
program think I should be. The reason
for my optimism is due to the Price
College Energy Management Program’s
leadership preparation via once-in-a-lifetime
opportunities that will make me an asset to
any future employer.
While we patiently await the recovery
of the industry, my message to future
energy management students is to get
involved in the Energy Management Student
Association as soon as possible, immerse
yourself in the history of oil and gas and
how it has evolved, and build yourself a solid
network of people who inspire you to be
better than you were the day before.
An Optimistic Outlook on the
ENERGY INDUSTRYBy Stephanie Robertson | Houston, TXEnergy Management Major
Energy management seniors proudly represent OU at the 2016 North American Prospects Expo in Houston.
OU Offensive Coordinator Lincoln Riley joins the group of seniors at the annual Helmets and Hard Hats reception, a fundraiser for the energy management program that coincides with the Houston convention.
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Producers May Tap Uncompleted Crude Wells on $50-$60/bbl WTI Price
Genscape by Bridget Hunsucker, Publications DirectorJune 6, 2016
U.S. crude producers could soon activate drilled but uncompleted wells if West Texas Intermediate prices hover in the $50/bbl to $60/bbl range, according to Genscape.
There are a total of between 3,000 to 3,500 DUCs in the United States, according to Genscape. About 650 of those uncompleted wells are in North Dakota, which “currently has one of the higher levels of DUCs of the shale plays,” said Jodi Quinnell, an oil product manager for Genscape.
But, even if some of those DUCs move into the production phase, it would take at least three months before new output comes online, Quinnell said. There is generally a lag of about four to six months between a price signal, such as the $50/bbl-mark, and production impact, according to Genscape.
The NYMEX July Light Sweet Crude futures contract price briefly breached the $50-bbl mark early last week but traded near $49/bbl on Friday. The NYMEX crude contract has a locational basis of Cushing, OK, where U.S. benchmark crude WTI is stored. Storage utilization reached above 80 percent last month for the first time since Genscape began monitoring the hub in 2009. Crude has moved into storage due to a global glut and a contango price environment. Cushing stocks hit a record high for the week ending May 13, of near 71mn bbls. Since, stocks fell due in part to supply disruptions in Western Canada, where a wildfire has caused production outages. Inventories at Cushing were near 69mn bbls during the week ending May 27, according to Genscape.
Market sentiment swayed toward supply rebalance
The WTI price has strengthened since hitting a low near $26/bbl in the first quarter of 2016, and the sentiment that the global
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Producers May Tap Uncompleted Crude Wells on $50-$60/bbl WTI Price Genscape by Bridget Hunsucker, Publications Director June 6, 2016 U.S. crude producers could soon activate drilled but uncompleted wells if West Texas Intermediate prices hover in the $50/bbl to $60/bbl range, according to Genscape. There are a total of between 3,000 to 3,500
DUCs in the United States, according to Genscape. About 650 of those uncompleted wells are in North Dakota, which “currently has one of the higher levels of DUCs of the shale plays,” said Jodi Quinnell, an oil product manager for Genscape.
North Dakota state reported DUCs. Click to enlarge
But, even if some of those DUCs move into the production phase, it would take at least three months before new output comes online, Quinnell said. There is generally a lag of about four to six months between a price signal, such as the $50/bbl-mark, and production impact, according to Genscape. The NYMEX July Light Sweet Crude futures contract price briefly breached the $50-bbl mark early last week but traded near $49/bbl on Friday. The NYMEX crude contract has a locational basis of Cushing, OK, where U.S. benchmark crude WTI is stored. Storage utilization reached above 80 percent last month for the first time since Genscape began
monitoring the hub in 2009. Crude has moved into storage due to a global glut and a contango price environment. Cushing stocks hit a record high for the week ending May 13, of near 71mn bbls. Since, stocks fell due in part to supply disruptions in Western Canada, where a wildfire has caused production outages. Inventories at Cushing were near 69mn bbls during the week ending May 27, according to Genscape. Market sentiment swayed toward supply rebalance The WTI price has strengthened since hitting a low near $26/bbl in the first quarter of 2016,
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oil supply and demand complex has moved into a rebalancing pattern is growing among market participants, according to Dominick Chirichella, senior partner at New York’s Energy Management Institute.
Prices “are likely at a level where economics make sense to move into a production stage” for DUCs, he said, noting that new output from DUCs could affect U.S. production rates as early as the second half of 2016.But, expected well completions are variable between producers and are likely “to be spread out and will not have the effect of starting to grow production again this year,” Quinnell said. U.S. production should fall through 2016 even if some uncompleted wells are activated. Total U.S. crude production is expected to average 8.752mn bpd in 2016 and 8.491mn bpd in 2017, according to data released last week by Genscape.
‘Abnormal’ wells untapped possibility
About 1,000 of the existing U.S. DUCs are considered “normal,” meaning the wells are part of untapped inventory generally due to pad drilling and will always be there at this level of rig activity. The remaining 2,000 to 2,500 wells are considered “abnormal” inventory, or wells that were uncompleted due to economics.
In recent years, some producers invested in drilling oil wells to take advantage of relatively cheap drilling costs, which have declined 50 percent since mid-2014 along with crude prices. Completion costs generally consist of up to 60 to 70 percent of total well costs.
It’s likely that about 500 of the abnormal DUCs are lower quality wells that would be completed at a higher price range of $80-$90/bbl, Quinnell said.
“Some of the uncompleted inventory could be from end of 2014 or beginning of 2015 from wells that were drilled outside the core areas” and would yield lower output, Quinnell said. “Producers could also be intentionally holding these wells because the anticipated return will not cover completion costs in the current price environment.”
In addition, skilled labor resource constraints could slow the pace of bringing uncompleted wells online should the WTI price stay within the $50/bbl to $60/bbl range. The well completion industry “has been hit hardest in this lower price environment…getting the completion crew back to work may be the biggest constraint,” Quinnell said.
US Rig Count Rises For Only Second Week This YearREUTERS MONDAY, JUNE 6, 2016
U.S. energy firms added rigs drilling for oil for the second time this year during the week ended June 3, energy services company Baker Hughes Inc. said, after crude prices briefly tested a seven-month high over $50 a barrel over the past two weeks.
That was a key price level that analysts and producers had said would likely trigger a return to the well pad. Drillers added 9 oil rigs during the week, bringing the total rig count up to 325, compared with 642 a year ago, Baker Hughes said in its closely followed report.
The new rigs were scattered across many basins and states with the Permian in West Texas and New Mexico gaining five, while Alaska and Texas gained three each. Prior to this week, energy companies added only one rig so far this year, during the week of March 18. They had cut on average 10 oil rigs per week for a total of 220 so far this year. They cut on average 18 oil rigs per week for a total of 963 in 2015, the most since at least 1988 amid the biggest rout in crude prices in a generation.
The rig count has dropped since hitting a peak of 1,609 in October 2014 as U.S. crude futures fell from over $107 a barrel in mid-2014 to a near 13-year low around $26 in February. Since then, U.S. oil futures have jumped by about 90%, breaking through the $50 mark earlier last week.
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Oil prices, however, were headed for a near 2% loss this week due in part to the rig count increase and on earlier signs the market was moving back to more balanced supply and demand after a series of supply disruptions, ending three consecutive weeks of price gains.
Looking ahead, crude futures were fetching nearly $50 for the balance of 2016 and over $51 for calendar 2017 . U.S. oil executives and analysts have said any price rise above $50 could fuel a resurgence in new drilling projects.
Analysts at U.S. financial services firm Raymond James said they believe the U.S. total natural gas and oil rig count is at or near the bottom and a modest recovery is in store for the back half of 2016. This week’s increase in total gas and oil rigs to 408 was the first gain since August, according to Baker Hughes.
Why Did Natural Gas Prices Just Rise 25% In Two Weeks?Oilprice.com by Rakesh Upadhyay June 7, 2016
Natural gas prices have run up phenomenally since the June contract expired on 26 May at $1.963/mmBtu. The natural gas prices touched
an intraday high of $2.48/mmBtu on 6 June before closing flat for the day.
Since October 2015, prices have not been able to cross the strong resistance area of $2.5/mmBtu, as seen in the chart below. Do the fundamentals support a breakout and higher prices in the coming weeks, or will we see a move back into the range?
fell from over $107 a barrel in mid-2014 to a near 13-year low around $26 in February. Since then, U.S. oil futures have jumped by about 90%, breaking through the $50 mark earlier last week. Oil prices, however, were headed for a near 2% loss this week due in part to the rig count increase and on earlier signs the market was moving back to more balanced supply and demand after a series of supply disruptions, ending three consecutive weeks of price gains.
Looking ahead, crude futures were fetching nearly $50 for the balance of 2016 and over $51 for calendar 2017 . U.S. oil executives and analysts have said any price rise above $50 could fuel a resurgence in new drilling projects. Analysts at U.S. financial services firm Raymond James said they believe the U.S. total natural gas and oil rig count is at or near the bottom and a modest recovery is in store for the back half of 2016. This week's increase in total gas and oil rigs to 408 was the first gain since August, according to Baker Hughes.
Why Did Natural Gas Prices Just Rise 25% In Two Weeks? Oilprice.com by Rakesh Upadhyay June 7, 2016 Natural gas prices have run up phenomenally since the June contract expired on 26 May at $1.963/mmBtu. The natural gas prices touched
an intraday high of $2.48/mmBtu on 6 June before closing flat for the day. Since October 2015, prices have not been able to cross the strong resistance area of $2.5/mmBtu, as seen in the chart below. Do the fundamentals support a breakout and higher prices in the coming weeks, or will we see a move back into the range?
We have to consider supply and demand, along with inventory data to understand whether prices justify their sharp rise, within such a short span of time. Though natural gas storage levels remain elevated, the supply glut is slowing compared to analysts’ expectations. As of 27 May, the Energy Information Administration reported natural
gas inventories of 2,907 Billion cubic feet, an increase of 82 Bcf, which was below the consensus expectations of 86-Bcf, according to The Wall Street Journal. In the previous week, inventories were 37 percent above five-year average levels compared to the same week in 2015; however, this week the surplus shrank to 35 percent
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We have to consider supply and demand, along with inventory data to understand whether prices justify their sharp rise, within such a short span of time.
Though natural gas storage levels remain elevated, the supply glut is slowing compared to analysts’ expectations. As of 27 May, the Energy Information Administration reported natural gas inventories of 2,907 Billion cubic feet, an increase of 82 Bcf, which was below the consensus expectations of 86-Bcf, according to The Wall Street Journal.
In the previous week, inventories were 37 percent above five-year average levels compared to the same week in 2015; however, this week the surplus shrank to 35 percent above five-year average levels. This is an indication of a diminishing surplus.“The 82 Bcf net injection into storage for last week was slightly less than the consensus view and below the 98 Bcf five-year average for the date, and so at least somewhat supportive for prices,” said Tim Evans of Citi Futures Perspective.
“The build was also well below our model’s 96 Bcf forecast,
and so will translate into a more bullish baseline for the reports to follow,” reports Natural Gas Intel.
In the long-term, the demand for natural gas is on the rise, as outlined in the EIA’s Annual Energy Outlook. However, in the short-term, the immediate demand for natural gas influences prices. Mild winter conditions were partly to blame for the record low prices in March of this year, along with the excess supply.
“1st Annual 5K Fun Run”
OCAPL- We are excited to announce OCAPL will host the first annual 5K Fun Run on Sunday, October 23rd, as a member benefit. The race will take place at Regatta Park, located southeast of downtown Oklahoma City (in Boathouse District), with on-site registration beginning at 1:00 p.m., kids 1-miles race at 1:30, and the fun run/walk starting at 2 p.m. The race will feature a marked out-and-back course along the banks of the Oklahoma River beginning immediately west of the Chesapeake Boat House. Families, strollers, four-legged friends and walkers and runners of all ages and abilities are welcome. In addition to the race, we’ll have family geared activities on site to help all the non-runners enjoy their time at the event too. Sponsorship opportunities will be available, so please be on the lookout for an email detailing this soon. -5K Fun Run Committee
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Aaron Meek & Dave HamptonHampton and MilliganThe legislative session has ended. The following bills were passed and signed by the Governor:
HB 3158 confirms that the OCC has the complete authority to regulate saltwater disposal wells and to immediately respond to “emergency situations having potentially critical environmental or public safety impact” (e.g., earthquakes) without notice or hearing.
SB 1122 directs the OCC to work with the Secretary of Energy and Environment, the OWRB, and the DEQ to encourage industrial use of water produced in oil & gas operation. It has been suggested that increased industrial use of wastewater could reduce the use of injection wells.
HB 1951 removes the municipal exemption from the requirement that excavators call the statewide one-call notification center.
HB 2303 extends the termination date for the OCC plugging fund from 2016 to 2021 and requires the balance to be maintained at $5 million.
HB 2599 prohibits flying a drone below 400 feet above “critical infrastructure” and it would prohibit flying a drone so close to “critical infrastructure” as “to interfere with the operations of or cause a disturbance to the facility.” The bill defines “critical infrastructure” to include several types of facilities, including refineries, natural gas compressor stations, LNG terminals or storage facilities, gas processing plants, natural gas distribution facilities, pipeline interconnections, and aboveground pipelines.
HB 2763 creates the Revenue Stabilization Fund. This bill attempts to stabilize state revenue derived from gross production taxes so that in the future state revenues will not be so heavily impacted by movements in oil & gas prices. The bill is complex, but in general it creates a moving five-year average of gross production tax collections and when gross production tax collections exceed the moving five-
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year average, some gross production tax revenue is deposited in the Revenue Stabilization Fund. The state can tap a portion of the funds in the Revenue Stabilization Fund during years when collections to the General Revenue Fund decline from the previous year.
SB 1577 imposes a cap of $12.5 million per year for the economically at-risk tax rebate. The bill also redefines an “economically at-risk oil or gas lease” so that after January 1, 2015, it means any oil or gas lease with production per well of 10 barrels of oil or 60 MCF of gas per day or less operated at a net loss or net profit which is less than the total gross production tax remitted for such lease during the previous calendar year. Prior to January 1, 2015, “economically at-risk oil or gas lease” was defined as any oil or gas lease operated at a net loss or net profit which is less than the total gross production tax remitted for such lease during the previous calendar year. So the bill essentially adds a new production cap to the definition.
If you know of legislative or regulatory activity that
you would like the Legislative Affairs Committee to analyze and discuss, please let us know by contacting Aaron Meek at [email protected] or (405) 235-5620.
BlueStar 2016.indd 1 1/7/16 2:18 PM
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12th ANNUAL WEEKEND TAKE OFF September 23, 24 & 25, 2016
Event: Continuing Education Seminar, sponsored by Oklahoma City Association of Professional Landmen Location: Beavers Bend State Park ~ Broken Bow, Oklahoma Credits: 10-12 AAPL accredited continuing education credits, including ethics (pending) Registration: $300.00 per person ~ Deadline August 29, 2016 ~ registration at www.ocapl.com
This event is limited to approximately forty participants ~ early registration is encouraged
Includes: All-inclusive educational retreat includes two nights’ accommodations in luxurious vacation homes (lodging provided through Creative Escapes www.ceyasoon.com) ~ all meals ~ refreshments ~ study materials ~ poker run ~ door prizes ~ boating excursion ~ and more
Speakers: Top energy professionals ranging from attorneys, geologists, environmentalist and landmen Topics: Relevant and current issues facing the oil and gas industry. Examples of past presentations have
included: water rights, the oil and gas lease, federal regulatory intrusion, marginal wells, ONRR/BLM, surface owner issues, “would you frac your neighbor”, rock cycle and basin formation, recent changes in oil and gas law and “open mic night”
Event Contact: Amy Love, [email protected] or John Frank, [email protected]
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2016 OCAPL WEEKEND TAKE OFF Beavers Bend State Park
September 23, 24 & 25, 2016
REGISTRATION FORM (Due before August 29, 2016)
Name: Company: Address: Phone: E-Mail: RLP/CPL #: ___ __
* * * * * * * * Registration Cost (per person) $ 300.00
TOTAL PAYMENT ATTACHED $ Registration can be made online at www.ocapl.org or by completing and mailing this form along with a check payable to OCAPL for the amount shown above to: OCAPL P.O. Box 18714 Oklahoma City, OK 73154
Registration is on a first come, first served basis so your prompt attention is required.
Contact info: Amy Love John Frank 405-823-1565 405-820-1182 [email protected] [email protected]
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12th Annual 2016 OCAPL Weekend Take Off September 23, 24, & 25, 2016
Working Agenda – Page 1
Friday – September 23, 2016: Credits 4:00 pm to 6:00 pm Casa Bodega: ~ Registration ~ - Use this time to find, settle in cabins
then return for speakers and dinner.
6:00 pm to 8:00 pm Casa Bodega: [Dinner] ~ Dennis McAfee & Brandi Smart ~ QPS Engineering 2.00 Environmental Issues facing the oil and gas industry
8:00 pm to 9:00 pm Casa Bodega ~ Jami Poor ~ Mineral Acquisition Partners 1.00 Earthquake Alert Zone Saturday – September 24, 2016:
9:00 am to 10:00 am Casa Bodega: [Breakfast] ~ Jon Love ~ Love Land Services, LLC 1.00 Title Curative and Verifying NRIs
10:00 am to 11:00 am Casa Bodega: ~ Trae Gray ~ LandownerFirm.Com 1.00 Natural Resource Law
11:00 am to 1:00 pm Casa Bodega: ~ Dave Hampton/Jordon Volino ~ Hampton & Milligan 2.00 Curing Oklahoma Indian Title
1:00 pm to 2:00 pm Casa Bodega: [Lunch] ~ Ethics Presentation TBD~ 1.00
12th Annual 2016 OCAPL Weekend Take Off September 23, 24, & 25, 2016
Working Agenda – Page 1
Friday – September 23, 2016: Credits 4:00 pm to 6:00 pm Casa Bodega: ~ Registration ~ - Use this time to find, settle in cabins
then return for speakers and dinner.
6:00 pm to 8:00 pm Casa Bodega: [Dinner] ~ Dennis McAfee & Brandi Smart ~ QPS Engineering 2.00 Environmental Issues facing the oil and gas industry
8:00 pm to 9:00 pm Casa Bodega ~ Jami Poor ~ Mineral Acquisition Partners 1.00 Earthquake Alert Zone Saturday – September 24, 2016:
9:00 am to 10:00 am Casa Bodega: [Breakfast] ~ Jon Love ~ Love Land Services, LLC 1.00 Title Curative and Verifying NRIs
10:00 am to 11:00 am Casa Bodega: ~ Trae Gray ~ LandownerFirm.Com 1.00 Natural Resource Law
11:00 am to 1:00 pm Casa Bodega: ~ Dave Hampton/Jordon Volino ~ Hampton & Milligan 2.00 Curing Oklahoma Indian Title
1:00 pm to 2:00 pm Casa Bodega: [Lunch] ~ Ethics Presentation TBD~ 1.00
12th Annual 2016 OCAPL Weekend Take Off
September 23, 24, 25, 2016
Agenda – Page 2 1:30 pm to 6:30 pm FREE TIME: Use this time to explore resort area, take a siesta, or see the lake on our reserved pontoon boat(s).
6:30 pm to 8:30 pm Casa Bodega: ~ Larry Coshow ~ Open Mic Night 2.00 (Registrants prepare questions for discussion) 8:30 pm to 9:30 pm Casa Bodega: ~ Dinner ~ Announce Poker Run Winners & Door Prizes This program is pending approval with AAPL for the following accreditation: CPL Continuing Education Credits 9.0 (2 of these can be environmental) RPL Continuing Education Credits 9.0 (2 of these can be environmental) (Ethics Credits) (1.00) TOTAL CREDITS: 10.00
POKER RUN: Attendees will draw a card upon entry into this presentation and prizes will be awarded for 1st, 2nd and 3rd place on Saturday evening.
A drawing will be conducted at the end of the Roundtable discussions. Everyone who contributes question will be eligible for the
drawing.
12th Annual 2016 OCAPL Weekend Take Off
September 23, 24, 25, 2016
Agenda – Page 2 1:30 pm to 6:30 pm FREE TIME: Use this time to explore resort area, take a siesta, or see the lake on our reserved pontoon boat(s).
6:30 pm to 8:30 pm Casa Bodega: ~ Larry Coshow ~ Open Mic Night 2.00 (Registrants prepare questions for discussion) 8:30 pm to 9:30 pm Casa Bodega: ~ Dinner ~ Announce Poker Run Winners & Door Prizes This program is pending approval with AAPL for the following accreditation: CPL Continuing Education Credits 9.0 (2 of these can be environmental) RPL Continuing Education Credits 9.0 (2 of these can be environmental) (Ethics Credits) (1.00) TOTAL CREDITS: 10.00
POKER RUN: Attendees will draw a card upon entry into this presentation and prizes will be awarded for 1st, 2nd and 3rd place on Saturday evening.
A drawing will be conducted at the end of the Roundtable discussions. Everyone who contributes question will be eligible for the
drawing.
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31st OCAPL FISHING TOURNAMENT The 31st Annual OCAPL Fishing Tournament was held on May 6th & 7th at Lake Texoma and was a success due to the continued financial support of our amazing sponsors and attendance by OCAPL members and guests. A total of $960 was raised for the Benevolence Fund via the annual raffle for a rod & reel valued at over $600. Despite higher water levels and tough fishing, the weather was great and a good time was had by all. Congrats to Justin Stamps for taking home the trophy for biggest bass and heaviest overall weight. Thanks again to all who attended and generously donated to this event, and we look forward to seeing you next year! McDonald Land Services (Platinum Sponsor) Stamps Brothers Oil and Gas, LLC (Platinum Sponsor) Beta Land Services,LLC Bill Irvin Land Services, LLC Calcutta Land, LLC Classic Petroleum, Inc. Osage Oil and Gas Felix Energy, LLC George H. Williams, PC Jackfork Land, Inc. Lowry Land Co., Inc. Mahaffey & Gore, P.C.
Pangaea, Inc. Penterra Services, LLC R K Pinson & Associates LLC Reagan Resources, Inc. Tahoe Land Services, LLC Viersen Oil & Gas Co. Wright & Associates, P.C. Jeff Brooks Superior Title Services, Inc. EK Energy Gateway Land Services, LLC Gary Land Services, Inc. Texhoma Land Consultants, Inc. Bass Pro Shops
31st OCAPL FISHING TOURNAMENT The 31st Annual OCAPL Fishing Tournament was held on May 6th & 7th at Lake Texoma and was a success due to the continued financial support of our amazing sponsors and attendance by OCAPL members and guests. A total of $960 was raised for the Benevolence Fund via the annual raffle for a rod & reel valued at over $600. Despite higher water levels and tough fishing, the weather was great and a good time was had by all. Congrats to Justin Stamps for taking home the trophy for biggest bass and heaviest overall weight. Thanks again to all who attended and generously donated to this event, and we look forward to seeing you next year! McDonald Land Services (Platinum Sponsor) Stamps Brothers Oil and Gas, LLC (Platinum Sponsor) Beta Land Services,LLC Bill Irvin Land Services, LLC Calcutta Land, LLC Classic Petroleum, Inc. Osage Oil and Gas Felix Energy, LLC George H. Williams, PC Jackfork Land, Inc. Lowry Land Co., Inc. Mahaffey & Gore, P.C.
Pangaea, Inc. Penterra Services, LLC R K Pinson & Associates LLC Reagan Resources, Inc. Tahoe Land Services, LLC Viersen Oil & Gas Co. Wright & Associates, P.C. Jeff Brooks Superior Title Services, Inc. EK Energy Gateway Land Services, LLC Gary Land Services, Inc. Texhoma Land Consultants, Inc. Bass Pro Shops
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AMERICAN ASSOCIATION OF PROFESSOINAL LANDMEN QUARTERLY BOARD of DIRECTORS MEETING, Tucson, AZ
March 20, 2016 The AAPL Quarterly Board Meeting was held Sunday, March 20, 2016 at The JW Marriot Starr Pass in Tucson, Arizona. Marc Strahn, AAPL President, called the meeting to Order. The Invocation was given by Roger Soape and followed by the introduction of guests and roll call of the Executive Committee, Directors and Committee Chairs. Upon adoption of the Agenda and introduction/seating of a new Director and Committee Chairpersons/Assistants, the minutes from the last board meeting on December 6, 2015 were adopted by acclamation. Treasurer’s Report: Jay Beavers, III, CPL, Treasurer, provided a report on AAPL and its affiliates ending December 31, 2014 as follows: As compared to December 31, 2014, AAPL, Inc.’s total assets have decreased from $34,212,385 to $30,730,618 a
change of $3,481,767 or 10.2% due in large part to paying $1,338,651 on the building loan, a transfer of $1,150,000 to the operating account to meet day-to-day expenses and a decline in the market value of investments. o Revenues (exclusive of investment revenue) compared to December 31, 2014 have decreased 32.4% from $3,183,454 to $2,151,255. The decrease in revenue is due in part to decreased revenue in education revenue as a result of the discount program on tuition and books which ended on December 31, 2015, elimination of recertification fees, decrease in NAPE distributions and management fee, timing of revenue recognition, and a reduction in the earned dues income. o Expenses have increased 20.4% compared to December 31, 2014 from $3,354,503 to $4,039,809. The net ordinary income (loss) for the 12 months changed from $(171,050) to $(1,888,554). The increase in expenses is in large measure due to the inclusion of depreciation as an expense. Other expenses include credit card processes fees, contract labor, directs meetings, and building repair and maintenance. o Investments as of December 31, 2015 are $24,008,506 a decrease of $3,863,965 or 13.9% as compared to the same period last year. The decrease has been the result of paying a portion of the line of credit used to purchase the new building, a transfer of $1,150,000 to the operating account, and realized and unrealized gains.
Education Foundation, Inc.’s balance Sheet reflects $3,401,835 which is a decrease of $339,986 or 9% as compared to the same period last year. The Statement of Investment Accounts reflects $2,347,052 total monies invested which is a decrease of $144,472 or 5.8% as compared to the same period last year.
Landman Scholarship Trust’s balance Sheet reflects $6,083,932 which is a decrease of $160,889 or 2.6% as compared to the same period last year. The Statement of Investment Accounts reflects $6,023,227 total monies invested which is an increase of $115,138 or 1.9% as compared to the same period last year.
Staff Report: Melanie Bell, Executive Vice-President, reports: There are currently four vacancies for the following positions: Personify Database Administrator, Electronic Media
Administrator, Business Development Manager, and Publications/Marketing Manager. Market conditions have been and will continue to be carefully assessed prior to increasing headcount.
The sale of the Fossil Creek building finalized, January 12, 2016 for $1,220,547 ($1,102,113 net at closing) NAPE lookback – In 2015, $6.88MM in net proceeds was were distributed to the NAPE partners in 2016; $4.52MM
was AAPL’s share of the net proceeds/management fees. NAPE Report: NAPE Summit (February 10-12, 2016) – Attendance was expected to be down ~25% from 2015 due to market
conditions; however, attendance was only down 20%. Overall attendance was 11,300. Rudy Giuliani was the keynote speaker for the Charities Luncheon, and Richard Fisher was the keynote speaker for the Decision Maker’s Breakfast. APPL presented checks to three charities totally $225,000.
Summer NAPE (August 10-11, 2016) – Budget scenarios completed considering a 25% decrease and a 40% decrease in exhibitors, attendees, and sponsorship revenue.
NAPE Denver (October 12-13, 2016) – Budget scenarios completed considering a 25% decrease and a 40% decrease in exhibitors, attendees, and sponsorship revenue. Registration open March 1, 2016.
Business Items: A motion to terminate Four Corners Association of Professional Landmen for failure to file taxes and other matters was
made, and the vote was passed without opposition. Subsequently, a motion to create a replacement association, the San
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Juan Basin Landman’s Association, was made. Bill Hackett attested to the fact that the new association bylaws had been drafted, leadership in place, and all required paperwork had been filed. The AAPL Board of Directors adopted the motion and approved the San Juan Basin Landman’s Association as a new association with Bill Hackett being named its AAPL Director.
New appointees to the Educational Foundation Committee were nominated, Roger Soape and Jay Beavers. These nominees were approved by an affirmative vote of the board. Each will serve a three year term.
Don Key presented the 2016/2017 slate of officers: o President – Pam Feist o First Vice President – David Miller o Second Vice President – Jeff Niemeyer o Third Vice President – Trinidad Hernandez o Secretary – Russel Shaw o Treasurer – Jim Bourbeau
A motion to approve the slate of officers was made, the vote called for and approved by acclamation. The AAPL is changing its reimbursement policy to “pay for play” for AAPL Directors. Previously, a sum of money
was provided to each association to aid in expenses associated with travel to the board meetings; however, not all associations were utilizing these funds as intended. Rather than provide a lump sum in advance of the meetings, AAPL will reimburse attendees directly provided they attend the board meeting and stay at the host hotel. Additionally, a motion to extend the financial assistance program to Committees Chairs, Task Force Leaders, Executive Committee Members, and Officers was made. The motion passed with all but one voting member in favor.
A vote to make Marietta College in Ohio the twelfth AAPL accredited Energy Management Program in the nation passed.
Bhavin Naik, Awards Committee Chairman, reviewed the awards process and disclosed the 2015 winners. OCAPL President, Nick Watkins, has already communicated the good news, so I won’t rehash how awesome OCAPL is in this report. Award winners will be recognized at the 2016 AAPL Annual Meeting in Orlando.
Incoming AAPL President, Pam Feist, proposed the 2016/2017 budget to the board with a new goal of operating within a balanced budget which requires the reduction of operating expenses. With some changes, the 2016/2017 budget was adopted by acclamation. A few items noted:
o Stressed the need for education program to be self-sufficient o Announced the elimination of the Landman 2 magazine o Announced the AAPL Annual Report will no longer be printed but will be available electronically o Discussed the high costs of the AAPL Annual Meeting and proposed cost savings measures including
changing the location of the 2017 Annual Meeting in Seattle. A separate vote was held after the board meeting that addressed changing the location of the 2017 from Seattle to Fort Worth. This proposal was voted down by the Board.
A motion to retire the debt of the new building and close the associated line of credit was made and adopted by acclamation.
Other Noteworthy News/Reports: AAPL has been involved in litigation related to HR matters; all such litigation is now 100% complete. Other than
attorney’s fees, all settlement costs were covered by insurance. There are over 1,000 credit hours (125 seminars) available online through AAPL’s website. Effective April 4, 2016,
these online seminars will be available to AAPL members for $10/credit hour, reduced from $15/credit hour. This reduction in price is part of a broader effort to make credits more convenient and economical to obtain.
The next Board of Director’s meeting will be on September 11, 2016 at the Snow King Resort and Grandview Lodge in Jackson, Wyoming.
There are many people that serve to advance our profession through their involvement with the AAPL and/or their respective local association. If you are interested in serving on an AAPL or OCAPL committee or otherwise becoming more involved, please feel free to contact me. Respectfully, Lindsey N. Miles AAPL Director
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2016 OCAPL Officers*Executive Officers
and Committee Chairman Advertising Price List for the Ocapl Record
Advertisement Price:_______ Quarter Page Add @ $500 for full year (10 issues)Ad Requirments:- 3 1/4 wide x 4 1/2 tall
- Ads need to be submitted in PDF or JPG with at lease 150 dpi resolution
Payment is due prior to publicationCONDITIONS: All advertising copy is subject to the ap-proval of OCAPL. Where copy is not furnished by the deadline date, the space reserved will be moved to the next issue subject to availability. Advertising is accepted in the order in which it is received until all space is filled.
Oklahoma City Association of Professional Landmen Office
Teresa PortwoodOCAPL OfficeP.O. Box 18714Oklahoma City, OK [email protected]: www.ocapl.org
Next Newletter Deadline:AUGUST 11, 2016
2015 Newsletter Chair:Michael Fleharty
Prepared by Dustin Burton
President *Watkins, Nick [email protected] President *Rice, Robert [email protected] *Beavers, Matt [email protected] *Brooks, Jeff [email protected] Past President *Love, Amy [email protected] Past President *Miles, Lindsey [email protected] Director *Miles, Lindsey [email protected] and Nominations *Parks, Colt [email protected] Affairs Chair McGee, Jordan [email protected] Affairs Co-Chair Cotter, Heather [email protected] Chair Jennings, Brandon [email protected] Co-Chair Cloer, Ryan [email protected] Chair McCurdy, Sam [email protected] Co-Chair Carlozzi, Brian [email protected] Walker, Mike [email protected] Committee *Fixley, Lindsey [email protected] Landman Chair *Hardegree, Jerrod [email protected] Landman Co-Chair Wickham, Diana [email protected] Landman Co-Chair Gibbs, Brian [email protected] Tournament Chair Graham, David [email protected] Tournament Co-Chair Miller, Jeff [email protected] Run Chair *Dickensheet, Dan [email protected] Run Co-Chair Rohlmeier, Heather [email protected] Night Out Chair Brockus, Alva [email protected] Night Out Co-Chair Anderson, Leslie [email protected] Tournament Chair *Naik, Bhavin [email protected] Tournament Co-Chair Kammerer, Brandon [email protected] Affairs Chair Sweeney, Mont [email protected] Affairs Co-Chair Legislative Affairs Chair Meek, Aaron [email protected] Affairs Co-Chair Hampton, Dave [email protected] Chair Love, Bethany [email protected] Night Speaker Chair Campo, Jennifer [email protected] Chair Fleharty, Michael [email protected] EM Mentoring Co-Chair Vawter, Brandt [email protected] EM Mentoring Co-Chair Hennigan, Bryan [email protected] EM Advisor Long, Steve [email protected] Relations Chair Raney, Grant [email protected] Relations Co-Chair Pribyl, Jordan [email protected] Advisor Richards, Jack [email protected] Clays Chair Reed, Shannon [email protected] Clays Co-Chair Ritter, Chase [email protected] Chair Sevier, John [email protected] Co-Chair Wolfe, Alex [email protected] Take Off Chair Coshow, Larry [email protected] Take Off Co-Chair Love, Amy [email protected] Manager Portwood, Teresa [email protected]
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