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Energy summit highlights oil and gas industry; Shale oil development helping US gain upper hand over OPEC

People and exhibitors gather Monday in Carlsbad at the Walter Gerrells Performing Arts Center during the Carlsbad Mayor’s Energy Summit. (Mike Smith Photo)

Copyright © 2021 Roswell Daily Record

CARLSBAD — “Oil is a global market.”

That was the word given to people attending the 2017 Carlsbad Mayor’s Energy Summit held Monday at the Walter Gerrells Performing Arts Center in Carlsbad.

The opening speaker was Robert McNally, founder and president of The Rapidan Group, an independent energy consulting and market advisory firm based in Washington, D.C.

During his speech, McNally talked about the history of oil prices and the law of supply and demand.

“Supply is inflexible and demand doesn’t really respond,” he said.

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During his history lesson, McNally cited John D. Rockefeller, the oil business industry magnate.

“He brought stability to oil,” McNally said.

Rockefeller’s Standard Oil Company was broken up by the United States Supreme Court in 1911 due to violations of anti-trust laws.

During the late 1920s, McNally said an oil glut saw the price collapse.

McNally also gave a history lesson on how National Guard troops in Texas and Oklahoma went into oilfields in those states in the 1930s and he also talked about how a regulation agency was created in Texas.

“The Texas Railroad Commission made sure we don’t see boom and bust again,” he said.

McNally also addressed how the price of oil has price has bounced from $30 a barrel to $145 a barrel and how the 2009 recession saw oil prices go down. He also said that OPEC could be a non-factor due oil development in the United States and other countries.

“Since 2009, we’re without an OPEC,” he said.

McNally added that shale oil development has also helped the U.S. gain an upper hand on OPEC.

Mike Nedd, acting director of the Bureau of Land Management, also addressed the crowd.

“There are incredible energy opportunities on America’s public lands,” he said.

Nedd also talked about how U.S. Department of Interior Secretary Ryan Zinke is trying to streamline many things that are expected to help oil and gas producers who use public lands.

The Carlsbad BLM office is one of the busiest in the nation when it comes to handing out permits for oil and gas developers.

“(Secretary Zinke) wants to make the BLM a better business partner with the oil and gas industry,” Nedd said.

He also addressed how Zinke wants to streamline the Environmental Impact Statement process to one year. “In the past it has been five to seven years,” Nedd said.

The interior boss also wants to cut down the amount of paper that an EIS uses, “up to 150 pages (and) get rid of the fluff,” Nedd said.

Clay Bretches, the president and chief executive officer of Sendero Midstream Partners, talked about how his company is expanding into Eddy County.

He spoke of how everyone is looking at the Delaware Basin for future oil and gas development, calling it, “the size of the prize.”

“Activity is off the charts,” he added about development in Eddy and Lea counties.

Sendero has miles and miles of pipeline extending south of Carlsbad and crossing into Texas. One plant is in place in Eddy County and he expects two more to be built in the future.

“Everything in the plant is brand spanking new,” Bretches said. “(There’s) almost close to zero in methane emissions.”

“Natural gas must be imported on a pipeline,” he said. “You can never put it on a truck.”

Bretches and some of the speakers stressed how important the oil and gas industry is to the entire state and not just Southeast New Mexico.

He cited that the average worker in New Mexico makes around $40,000 a year.

“The oil and gas worker in New Mexico makes $70,000 a year,” Bretches said. “This industry brings in many high-paying jobs.”

Bretches said 40,000 people in the state are employed in the oil and gas industry.

“Indirect jobs are 66,000 and over 100,000 employees are impacted by the oil and gas sector,” Bretches said.

In addition to the speeches, a job fair was also held Monday at the energy summit.

General assignment reporter Mike Smith can be reached 575-622-7710, ext. 307, or at sports2@rdrnews.com.