Re-invent, Re-tool, Re-imagine: Finding Success in the Resources Arena

Ms. Vicki A. Hollub

How do you advance a US business with a historically conventional/EOR position to a successful Unconventional Resources player? What do you do to build on that? First, you need to Re-invent your business to meet the challenges of the energy industry, and society as a whole. Then, Re-tool to face the challenges of the present and improve opportunities for all stakeholders. Finally, building on that platform, to Re-imagine your business, through responsible stewardship and safe operations, while leveraging the fundamental human desires to improve, explore and evolve. This talk will focus on these three components as they relate to the unconventional resources business.

Enigmatic Shale

Dr. Scott W. Tinker

Production from shale reservoirs in the United States and Canada has changed the global energy landscape. Yet shale reservoirs remain enigmatic. Industry analysts debate whether shale producers lose money or make money, but few would argue that the North American economy has benefited significantly from shale production. Studies show that ultimately recoverable resources of shale are massive, yet ultimate production from shale given current technology represents less than 10% of the resource in place. Environmental impacts from shale development are real, yet CO2 emissions in the U.S. have decreased faster than those of any major nation on Earth, thanks largely to shale gas replacing coal in power generation. The politics of shale are complex, with some governments, NGOs, and industries in strong support and others in strong resistance. The complex interplay of these paradoxical realities underscores the challenges inherent in predicting the global future of shale.

What the Investor Community Wants From the Unconventional Fracocene

Dr. Bob Brackett

Geologists have adopted the term 'Anthropocene' to denote the current geologic epoch in which the Earth's geology, biology, and climate are significantly influenced by the human species. By analogy, we are also living in the 'Fracocene' – an epoch in which the global energy economy is being significantly influenced by oil & gas production from North American long-lateral horizontal wells hosting massive hydraulic fractures into low-permeability reservoirs. This resource represents the largest, most responsive, and thus most cyclical segment of the market. The lion's share of this resource has been delivered by the publicly-traded E&P sector. Institutional investors can put money to work in any sector in the market in exchange for a fair (or better!) risk-adjusted return on the capital they offer. Is the E&P industry delivering what investors want? A scorecard of the 'Fracocene' grades the industry in regards to returns on capital, returns of capital, growth, technology, longevity, discipline, and riskiness. This scorecard goes a long way in explaining the actual and potential relative returns arising from our industry and its perception by investors.