Let’s get it right this time

KEITH W. LYNCH, Global Completions Chief, ConocoPhillips Company

“It's tough to make predictions, especially about the future.” This quote is attributed to Yogi Berra, former American Major League Baseball player and inadvertent philosopher. I’m not sure of the context, or if he actually said it, but I am reasonably sure he wasn’t talking about the oil and gas business. For those of us who started our careers during the boom of the late 1970s to the early 1980s, it was easily conceivable that while we wouldn’t see the end of the industry, we could see the beginning of the end. We would potentially establish the final plans to ride the big decline curve down. With a finite resource limited to conventional reservoirs, a vision of the end was coming into focus.

Certainly there would be some minor deviations, new land being opened for political reasons or the frontiers of deep water being extended, but arresting the decline curve appeared impossible. Previous oilfield generations experienced this exact scenario with a grim prediction of the end. Now, we should be reminded of George Santayana’s observation, “Those who cannot remember the past are condemned to repeat it.” Over the years, we made significant incremental improvements to extend the life of conventional oil and gas. However, with the limitation imposed by only producing migrated accumulations, eventually significant industry contraction would be inevitable. Enter the shale revolution!

It may be a misnomer to label something a revolution that literally took years to evolve, but the change in the supply curve is indisputable. When the U.S. was able to go below the 50% level for imported oil in 2010 for the first time since 1997, it was clear that a foundational shift had occurred. This happened through the application of sound science, technology, and bold action with the accompanying financial risk. It’s difficult to assign all of the credit for this success. Anyone who tries will forget key contributions, seemingly too small to mention, that were critical, nonetheless. Once again, the industry finds itself in an advantaged position, with many to thank and no clear vision on how to maximize the benefit.

Getting the word out. The oil and gas industry has an opportunity to redefine its reputation and establish an improved relationship with the energy consumer. We need more people pulling for us instead of pushing against us. We can influence opinions and actions. Oil and gas are a part of the world’s present and future. The industry cannot allow itself to be viewed as a necessary evil. It should be embraced as a major contributor to the improvement of the human condition. Make no mistake about it, affordable, reliable energy is a key to society working, not to mention the other petroleum-related products that facilitate our health, comfort and well-being.

We already know what is required to achieve this desired state: responsible development on the industry’s part and better understanding by the public. The industry must lead the effort on both fronts. The industry has progressed over the years to a state, where development of energy resources is fully compatible with the environment and integral to social progress. Most regulators recognize this relationship and the industry knows, at its core, that it is good business to do things right. Any company that desires a sustained business will behave in a way that promotes long-term environmental stewardship. A focus on protection of freshwater resources and verifiable well integrity is paramount. Everyone should be compelled to operate in a manner that supports the long-term well-being of the industry and communities impacted by our activities. If companies don’t accept that responsibility, they need to be in another business. There are no shortcuts to doing it right.

To establish trust with the public and regulators, the industry needs to speak with a consistent voice, providing education on the process and potential impacts, both positive and negative. We can’t afford to allow misleading portrayals to be propagated in the mass media without a response. To counteract the misinformation from the over-the-top dramatization of reality television or the politically-driven “shockumentaries,” the industry needs to listen and engage with the public. All of us need to actively listen, learn more about the public’s concerns and be ready to be advocates for responsible development by providing examples and sharing performance indicators of assurance on the integrity of oil and gas production processes.

Oil and gas are an essential part of our future. As Dr. Nathan Lewis, California Institute of Technology, summarizes technology change in his lecture about current and future energy sources, “The stone age didn’t end because we ran out of stones.” We’re not running out of oil and gas, and we have not devised another option to store and transport energy the way we can with hydrocarbon-based fuels. Fossil fuels, along with renewables and new technologies, will be part of a portfolio for a long time, which means focus on environmental and social performance is even more important.