Category Archives for "Uncategorized"

Jan 06

There is a new Landman in the Wind

By David Melton | Uncategorized

Wind Energy or power is nothing new, but with the developments regarding the global need for alternative clean over the past decade, renewable energy is growing.  As a result, the market has been taking on new life, growth, and future importance in an attempt to address ‘global warming’. 

Currently, wind energy power supplies only a small fraction of the electricity needed in the United States.  But with recent improvements in technology, according to the American Wind Energy Association, 20% or greater of our electricity is estimated to come from Wind Energy by as early as 2020.  Growth is just now picking up steam for Wind Energy to be the next cash crop.   

The power of wind and solar energy is enormous, and according to the American Wind Energy Association.  Wind Energy could produce over ten billion kilowatts annually – three times the amount of power the United States is used to using in the past decade.  

As of 2020, we are witnessing a historic moment for oil and for the energy industry as the world moves toward a clean energy transition that has been catalyzed considerably by the COVID-19 pandemic.  Even before the novel coronavirus disrupted the global economy and international industries and supply chains, there was already a lot of talk about peak oil coming up around the bend and renewable energies such as solar and wind power have been getting cheaper and more efficient by the year, outgrowing subsidies and becoming competitive with some fossil fuels.

COVID-19 has only fast-tracked this energy transition as world leaders rush to create green stimulus packages for post-pandemic economic recovery at the urging of such experts as the World Economic Forum, which has advocated for a “new energy order” and a ”great reset.”  In fact, the tide has turned on emissions-heavy fossil fuels to the extent that Big Oil’s most profitable industry is no longer oil, and in Europe supermajor oil companies are looking to reinvest and rebrand themselves as “Big Energy.” 

“Over the past decade, the oil companies, whose profits were mostly derived from pumping crude out of the oil fields they discovered, transformed themselves into ‘oil and gas’ companies.” “Now they are evolving once again to become ‘energy’ companies.  Shell’s latest report shows that almost half of its production was natural gas, compared with less than 40 percent in 2005.” – oil strategist Julian Lee wrote for Bloomberg Opinion in August 2020.  Recent predictions have been made by the IEA that “Oil and Gas sectors will bear the brunt of this declining oil demand, with 2040 production cuts by nearly 50% when calculated by present value.”

Today, this trend is continuing outside of Europe and across the globe as we witness some of the world’s biggest oil companies look to diversify in order to stay relevant and in the black. 

The Wind Energy Industry has some similar, but also very different issues from the Oil and Gas Industry that, as a Landman, you must know if you plan to work in this field.  Both require state, local, and federal compliance, leases to build and operate the production facilities, and research prior to the development of the project. 

There’s an old saying, “No well is drilled, bought or sold without a Landman being involved.”  The same goes for a ‘wind farm’ or ‘solar farm’.   A Landman’s job is always on the move and expanding to fit the latest technology, such as ‘horizontal drilling’ versus ‘vertical drilling’ projects and now ‘wind and solar energy.’  As horizontal drilling became more and more the ‘norm’ the oil and gas lease and Joint Operating Agreement changed to fit issues surrounding that type of drilling operation.  So, at the end of the day, Petroleum Landmen had to obtain education on such things as “Production Sharing Agreements”, “Offset land use Agreements”,  and the 2015 Joint Operating Agreement.  

If a Petroleum Landman is skilled in mineral title, Oil and Gas Leases, and/or right-of-way acquisition, he or she should have little trouble in adapting to the tasks surrounding the Wind Energy Industry and working with companies who are actively developing wind projects.

In addition, when you add in the fall of the Oil & Gas Industry in April of 2020, many Petroleum Landmen are finding themselves out of work and looking to make the transition into something where they can still utilize their skills.  Historically, the Right-of-Way Industry has been one such place where many Independent Petroleum Landmen have moved to.  If Petroleum Landmen have had a history in dealing with Oil and Gas Lease negotiations, the Right-of-Way Industry is a good fit for them as well.

Now, when you combine negotiating Wind and Solar Leases along with the associated Right-of-Way agreements to the growing Wind and Solar market, for the far foreseeable future the Alternative Energy Industry should experience a short fall of qualified Landmen to fill these roles and training is vital to help educate these transitioning Landmen.  As of right now, the American Wind Energy Association does not offer such training to and/or for Landmen.

Respectfully,

David Melton
Founder/CEO

Jan 06

Wind and Solar vs Natural Gas

By David Melton | Uncategorized

One thing is clear, Wind and Solar Energy are here to stay.  But, what about Natural Gas?  One main and large issue with Wind and Solar Energy is the lack of ability to store any of the energy they create, unlike natural gas reserves (underground storage facilities and LNG).

A common thread with both industries is that they require well trained Landmen, especially in negotiating and understanding associated leases along with acquiring Right-of-Ways and Easements.  

A big source of conflict between the use of natural gas and wind/solar energy is the use of natural gas to generate large amounts of electricity instead of coal.  According to a recent report of the U.S. Energy Information Administration, 36% of natural consumption was used in large electric generating plants, 33% for industrial use, 16% for residential use, 11% for commercial use and 3% for transportation. 

Like with wind and solar, natural gas is an inexpensive and abundant energy source.  But wind and solar energy is subject to blackouts due to no consistent wind source and solar due to no consistent source of sunlight (24/7/365). 

While the oil and gas industry should strive to work in harmony with the idea of less omissions, the fact remain, to change out the entire country’s infrastructure to electricity from wind and solar will be a monumental task, costs astronomical amounts of money, will put a millions of people out of work, not to mention cause the mass replacement of natural gas systems in homes and in appliances.  The author’s opinion would be to funnel some of this new transformation cost to further fund research how to dramatically reduce the omissions from natural gas, rather than try to change the entire country’s infrastructure over a few years.

The idea of alternative fuels for cars, including biofuels and electricity is also a massive undertaking when you consider completely changing the game for all industries from overland trucking, sea and air travel, military, to such things as nationwide mail trucks, etc.  While this idea makes good politics, the practical aspect is a dream in our lifetime. 

However, since that push to start is already here, the alternative energy sector will be needing well trained and diversified personnel to assist with the legal and land aspect of it.  For years, the Petroleum Landman has played a crucial role in oil and gas development.  This push for alternative energy will be creating the need for well-trained Landmen in the Alternative Energy sector. 

If you are wanting to become a Landman working in the wind/solar energy sector or if you are already one who needs to make a change, now is the time to get on this band wagon, before competition makes it harder to enter into the sector.

Respectfully,

David Melton
Founder/Institute of Energy Management, LLC.

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