It was the summer of 2007. When I joined Hart Energy as the editor of its A&D Watch newsletter, George W. was in the latter days of his presidency, and Hillary was jockeying for position. The iPhone had just debuted. Barry Bonds topped Hank Aaron’s home run record. And Al Gore won the Nobel Peace prize on global warming.

More importantly, oil was at $80/bbl going to $140, and natural gas was at $7/Mcf on its way to $13. A thing called shale was the buzz, and the Barnett was buzzing.

U.S. A&D deal value for the year topped out at $55 billion in a flurry of deals, headlined by Plains buying Pogo Producing, Encana scooping up Leor, El Paso merging with People’s Energy, BreitBurn buying QuickSilver’s Antrim, and Petrohawk entering a tight rock play called the Fayetteville.

It was heady days indeed for the oil and gas industry.

Of course, the crash of Lehman Brothers followed by the Great Global Recession ensued a year later, sending oil to $40 and gas to $4. But within a year, oil would come roaring back; gas not so much.

No sweat, the industry would switch to liquids rich plays, and it was off to the races again.

Before long, land grabs and JVs and private-equity buyouts would rule the day, and $100-plus oil juiced the momentum. It seemed like it would last forever. Some believed that.

Five years later, on a warm and breezy day this past May, I stood along Business I-20 between Midland and Odessa, where 30-something H&P big rigs stood stoically stacked in a yard.

It was symbolic; the tide had turned. Oil hovered at $40. Nationwide, the rig count had fallen by half.

OPEC can be testy when its global market share is challenged by a few resourceful, entrepreneurial and scrappy independent oil and gas producers.

It’s been a year now since the Thanksgiving surprise, when Saudi Arabia and its OPEC cohorts declined to defend the oil price, instead letting the spigots flow in spite of global crude oversupply.

In December, OPEC once again refused to back down, teeing up another year to test the U.S. industry’s strength.

And we’re a resilient bunch. Operators are slicing the fat and developing cost efficiencies that will help them to survive the headwinds, and thrive on the other side.

Those blessed with strong balance sheets are poised to acquire and grow through the downturn. Production has slowed, inventories are being worked down. Analysts hesitantly look to the second half of this year as a possible turning point. Say amen.

Which brings me to my point. The advent of a new year brings review and preview, and as we take stock of where we are and where we’re going, it warrants taking some deep breaths and making strategic changes where warranted. Like the rest of the industry, we’re taking the opportunity to do that very thing here at Oil and Gas Investor.

It is a privilege and honor to take the helm to guide the editorial direction of such a fine and respected publication.

Fortunately for me and the magazine, Leslie Haines is stepping up, not out, to advise at all levels of Hart Energy, and will continue to contribute her wisdom, wit and words to the publication.

During her 30-year-and-ongoing tenure here at the magazine, rising from editorial assistant to editor-in-chief, Leslie has been a champion for the industry and guru for our industry-leading publication. She’s colloquially known as the Queen of the Oil Patch, and following in the tracks of the iconic Leslie Haines as editor of Oil and Gas Investor is certainly a tough act to follow.

The mission of Oil and Gas Investor is to deliver strategic insight for making capital investments in the oil and gas industry.

We follow the money, and explore where it’s going and why. Whether you are an industry executive, capital provider, supporting service or private investor, we aim to keep you on the sharp edge of industry trends.

As example, check out our new A&D Watch section of the magazine on page 109. We think A&D is integral to the lifeblood of oil and gas, and are dedicated to emphasizing it within the pages of the magazine this year.

As we launch into this new era, I welcome your input. Saturate me with your perspectives, and let me know how as a publication we can better provide you with the market intelligence you need.

My phone and email are for you. We’re in this together, and from my perspective, the future looks up and to the right.

Comments