“Taking a second look” might be deemed a common theme in our array of articles. These are the full versions of the “Drilling Deeper” news items that appeared in abbreviated versions in the print edition of the July PBOG.
Crude Exports Yield Benefits
A new state by state analysis shows that Texas could add up to 40,921 jobs and $5.21 billion to the state economy in 2020 I f federal restrictions on U.S. crude exports were lifted, said American Petroleum Institute Vice President for Regulatory and Economic Policy Kyle Isakower.
“The United States is poised to become the world’s largest oil producer, and access to foreign customers will drive job creation in Texas and around the country,” said Isakower. “When it comes to crude oil, the rewards of free trade are amplified wherever energy, manufacturing, and consumer spending drive growth. American energy exports mean new jobs, higher investment, and greater energy security.”
The new report was conducted by ICF International and EnSys Energy. It provides a state-by-state analysis of economic benefits first outlined this March in a national report, which showed that lifting export restrictions could save consumers up to $5.8 billion per year, on average, between 2015 and 2035, as higher production and efficient markets help boost supplies and lower costs.
The latest report shows that Texas is among 18 U.S. states that could gain over 5,000 jobs each in 2020 from exports of U.S. crude oil. The study also forecasts that most states could see economic activity grow by hundreds of millions of dollars due to growing energy production and downward pressure on the prices at the pump. In addition:
- Depending on global price trends, nine states—Florida, Michigan, Indiana, California, New York, Pennsylvania, Ohio, Texas, and North Dakota—could see over $1 billion each in state economic gains in 2020, with slower growth through 2035 after new drilling plateaus.
- Eight states—Illinois, Florida, New York, Pennsylvania, Ohio, California, North Dakota, and Texas–could gain more than 10,000 jobs each in 2020.
* North Dakota could gain 22,215 added jobs and $4.81 billion in state economic growth in 2020.
* States with significant manufacturing and consumer spending, such as California, could add 23,787 jobs and $2.06 billion in economic activity in 2020.
* Illinois could add 10,033 jobs and $990 million in state income in 2020.
“Restrictions on exports only limit our potential as a global energy superpower,” said Isakower. “Additional exports could prompt higher production, generate savings for consumers, and bring more jobs to Texas. The economic benefits are well-established, and policymakers are right to reexamine 1970s-era trade restrictions that no longer make sense.”
API represents all segments of America’s oil and natural gas industry. Its more than 600 members produce, process, and distribute most of the nation’s energy. The industry also supports 9.8 million U.S. jobs and 8 percent of the U.S. economy.
Kyle Isakower
Essentials For Strong Leaders
by Lynda Chervil
There are five keys to developing personal power, and each involves our working on E.I.—Emotional Intelligence—to open the door to achievement.
Personal power is a core leadership competency that everyone needs to develop before he or she can lead others. It has to do with being able to lead oneself.
“Personal power is the ability to achieve what you want,” according to Frederick Mann, a successful entrepreneur and author of The Economic Rape of America. “More than anything else, it is personal power that brings you success and happiness. The biggest barrier to success in almost any endeavor is powerlessness, negativity, helplessness, and inertia. They belong together. The problem is not only our own powerlessness, but also the powerlessness of those around us.”
We can help harness and learn to use our personal power by understanding and working on our Emotional Intelligence (EI) skills.
Not long ago, when I worked in a corporate environment, there was a strong push to incorporate EI into the organization’s leadership training curriculum as an array of skills and characteristics that drive leadership performance. EI is “the ability to monitor one’s own and others’ feelings and emotions, to discriminate among them and to use this information to guide one’s thinking and actions,” according to psychologists John D. Mayer and Peter Salovey, who co-developed the concept and were two of the three authors of the Emotional Intelligence Test.
My EI training and its practical applications to my work team environment still resonate in my personal life. They became skills that I now methodically apply to current situations in both personal and entrepreneurial pursuits.
There are several EI models, but the one to which I ascribe is the mixed model introduced by Daniel Goldman, a combination of ability and traits. Here are Goldman’s five main EI constructs, and my views on how each of us can develop them:
1. Self-awareness: the ability to know one’s emotions, strengths, weaknesses, drives, values, and goals and recognize their impact on others while using gut feelings to guide decisions.
In order to become self-aware, you need to conduct an honest self-assessment to determine your strengths and weaknesses, such as powerlessness and inertia, and determine the root causes. You then need to create a plan that will help you overcome your fears, which are barriers to courage and stand between you and your successes.
While I am a big proponent of using my intuition to guide my decisions, whenever it is appropriate, I need to caution that unless your gut feelings are often more right than wrong, you cannot make decisions solely based upon intuition. You need to use a balanced combination of intuition and logic.
2. Self-regulation: involves controlling or redirecting one’s disruptive emotions and impulses and adapting to changing circumstances.
Simply put, you need to exercise self-discipline and know how to control your emotions and be flexible in order to adapt to changing situations. You cannot continue on the same trajectory or keep the same plans when the circumstances or facts have changed. Your plans need to be modified accordingly.
3. Social skills: managing relationships to move people in the desired direction.
Your social skills refer to your interpersonal skills or your ability to relate and connect with people, which can motivate them to deploy discretionary efforts to help you achieve goals that are best accomplished via partnership and collaboration.
Here are some tips for improving your social skills:
a. Pay attention to the feedback of friends and co-workers, good and bad. Train yourself to repeat the behaviors that get positive feedback and work on eliminating those that make people react negatively. b. View constructive criticism as just that. When we become defensive, we don’t hear what can be very helpful feedback. c. Learn to handle conflict and confrontation from a perspective of compassion and caring.
Personal coaching can be very helpful in learning to be more diplomatic in your interactions with others.
- Empathy – considering other people’s feelings, especially when making decisions.
Some people believe empathy cannot be learned, but I believe just the opposite. Put yourself in the other person’s shoes and try to see situations from their perspective. Might they be feeling fear? Shame? Guilt? How do those emotions make you feel? Understanding and addressing the concerns of others is essential to EI.
Always consider intent versus impact, and how your actions or decisions may affect the individuals or groups involved.
- Motivation – being driven to achieve for the sake of achievement.
Simply put, what motivates you? What are your benchmarks for success? Once you achieve certain levels of success, you need to consistently set new benchmarks to keep chasing personal excellence!
Practice your EI skills on yourself first, and you’ll develop greater personal power. That can lead to achievements you may never have dreamed possible.
Lynda Chervil is the author of Fool’s Return, (lyndachervil.com), a new novel that incorporates valuable life lessons in a page-turning tale that touches on technology, the green movement, and other aspects of contemporary society. She graduated from New York University with a master’s degree in Integrated Marketing Communications and has extensive experience in consumer and commercial banking and has held positions in new business development, sales management and executive leadership. Chervil seeks to push the limits of established understanding by exploring alternative forms of spiritual healing, and, through creative writing, to expand the narrative of cutting-edge energy technology to promote sustainability.
Lynda Chervil
TCPS Reassesses Water Shortfall
A report issued May 9 by the non-profit Texas Center for Policy Studies (TCPS) finds that the current water planning process in Texas tends to over-estimate future water demand and under-estimate the potential for making better use of existing supplies.
As Richard Lowerre, TCPS executive director, said, “This report shows that, with more reasonable demand projections and better use of conservation and drought management, the demand/supply gap in 2060 is less than one-half that predicted by the current 2012 State Water Plan issued by the Texas Water Development Board. That is, rather than an 8.3 million acre-feet/year gap between demand and supply in 2060, a more realistic gap is about 3.3 million acre-feet/year.”
The report, Learning from Drought: Next Generation Water Planning for Texas, analyzes the methods used by the state and the 16 regional water planning groups to develop demand and supply projections. “The region-based Texas water planning process was groundbreaking when it first got off the ground 15 years ago. But, times and technologies have changed, and it’s appropriate to look at how the planning process can evolve to give us a better sense of real priorities,” said Mary Kelly, a consultant with Parula LLC and one of the report’s co-authors. “This is particularly important as the state begins to look at how to spend the new $ 2 billion water infrastructure fund authorized by voters in November 2013,” she added.
The report makes a number of recommendations for the future of water planning in Texas. For example, it recommends moving away from current “single scenario” forecasts to an approach that looks at a range of future scenarios. “A multiple scenario approach would allow a much more comprehensive look at the kind of choices we make about how water is used and the expense of building new infrastructure versus more efficiently using existing supplies,” said Joe Trungale, an water resources engineer and co-author of the report.
Other recommendations include:
* More reasonable assumptions about the need for water for future steam electric generation;
* Enhanced consideration of drought contingency planning as a supply strategy;
* More thorough consideration of brackish groundwater desalination as a supply strategy;
* Gathering and using more accurate data on current water use;
* Making healthy rivers and bays and vibrant rural economies co-equal with other goals of the water planning process.
“The drought has provided new insights into the vulnerability of communities whose needs have been ignored and into the willingness of Texans to adopt innovative and far-reaching water conservation practices. Combined with the developments in state water financing, a more prominent role for the Texas Water Development Board and heightened public interest in water, now is the time to examine whether we have a planning process that is up to the task,” added Lowerre.
The Texas Center for Policy Studies is a 501(c)(3) non-profit, founded in 1983. The report is available on the TCPS website at www.texascenter.org.
Chevron Ups Commitment to Permian
Chevron Corporation in May 28 provided an overview of the company’s 2013 operational and social performance and future growth plans at its 2014 Annual Meeting of Stockholders in Midland, Texas.
“Chevron’s 2013 results demonstrate that we remain well positioned to grow profitably and continue to deliver superior stockholder value,” said John Watson, chairman of the board and chief executive officer. “We continue to advance key development projects, which underpin our planned growth strategy and capacity to deliver affordable energy to world markets, a cornerstone of economic prosperity.”
Reuters news service observed that Chevron is “making the oil-rich Permian shale formation a top investment priority, aiming to turn its West Texas acreage into one of its top five assets by 2020,” a remark Reuters attributed to Chevron Vice Chairman George Kirkland.
Said Reuters: “The move is a return home of sorts for the second-largest U.S. oil company, which has operated in the Permian since the 1920s. But until now, it has been slow to follow rivals in West Texas who over the last five years have deployed new techniques to recover previously unreachable oil.”
During the Midland meeting, Watson discussed Chevron’s 2013 financial and operational performance, highlighting earnings of $21.4 billion and return on capital employed (ROCE) of 13.5 percent. In 2013, the company marked its 26th consecutive year of annual dividend payment increases, which included last year’s dividend increase of 11.1 percent. Chevron announced another quarterly dividend increase of 7 percent in April 2014. Watson also said that Chevron led its peer group in total stockholder return for the five-year period ending Dec. 31, 2013.
Watson further reiterated Chevron’s long-standing dedication to safe, reliable operations. Reinforcing the company’s commitment to process safety, he noted that Chevron’s goal remains zero incidents and ensuring that everyone goes home safely, every day. Watson also discussed the partnerships Chevron has formed to address health, education and economic development in the communities where the company operates. Over the past eight years, Chevron has made nearly $1.5 billion in social investments to local communities.
George Kirkland, Chevron vice chairman, said the company is on track to grow production to 3.1 million barrels of oil-equivalent per day by 2017, up 20% from 2013, with more growth expected through the end of the decade. To reach this goal, the company has more than 70 projects, each with a Chevron share of more than $250 million, scheduled to start-up by the end of this decade. In Australia, the Gorgon project continues to make steady progress toward first liquefied natural gas (LNG), and is 80 percent complete with start-up expected in mid-2015. Wheatstone is now almost 35 percent complete and remains on schedule for a start-up in 2016.
Kirkland continued by outlining Chevron’s profitable growth plans, which focus on building legacy assets associated with crude oil and natural gas. These plans include investing $39.8 billion in 2014, which represents a $2 billion reduction from 2013 spending.
In 2013, Chevron maintained an industry leading earnings per barrel average, which was nearly five dollars per barrel higher than the company’s peer group over the past three years. Chevron has also had the highest ROCE in the Upstream sector since 2011, with an industry leading 17.2 percent in 2013.
Additionally, Kirkland discussed Chevron’s Downstream and Chemicals business, where the company’s refining and marketing earnings per barrel ranked 2nd among peers. This business also posted 10 percent ROCE in spite of a challenging margin environment for the industry.
Kirkland concluded by affirming the Downstream and Chemicals business focus on select areas of growth, including key Chevron Phillips Chemical projects that take advantage of existing infrastructure and attractive feedstocks. This year, the joint -venture company plans to start-up the world’s largest on- purpose 1-hexene plant and broke ground on a world-scale ethylene cracker and derivatives unit on the U.S. Gulf Coast. Also, Chevron’s Pascagoula base oil plant is slated to reach full production by mid-year, making Chevron the largest producer of premium base oil in the world.