Tom Ward
Editor’s note: This profile is part of Hart Energy’s Hall of Fame series honoring industry pioneers and the Agents of Change (ACEs) who are leading the energy sector into the future.
Tom Ward was just 16 when his father passed away, leaving him adrift and in need of guidance on what to do with his life. His uncle was a successful landman in western Oklahoma; his brother and grandfather were in the energy business, too. The industry held an allure.
“Just following in their footsteps, this is basically what I was doing at the time,” he told Oil and Gas Investor.
Ward found a job working the summers as a swamper, a general roustabout, at a saltwater disposal trucking firm for $4/hour. He was one of 42 graduates at Seiling High School in 1977, intent on studying petroleum land management at the University of Oklahoma.
Ward and his wife worked their way through school, and he graduated in 1981. The couple moved to Clinton, in western Oklahoma, after he was hired at Mewbourne Oil.
“I really never wanted to leave my hometown, so the idea of moving off to one of the big cities was never really anything I was too interested in,” he said. “I chose to work in western Oklahoma because that’s where I was from. I enjoyed the small-town atmosphere, and I wanted to be close to our families.”
The decision represented a path that was contrary to the one that many others were taking, but as Ward says, “I was never like most others. I loved living in a small town.”
At the time, Clinton had a population of 10,000—small by big city standards, but still eclipsing the current population of Ward’s hometown in Seiling, Okla., by a factor of 10.
At the crossroads
Seiling is the largest city in Dewey County. Its location in northwestern Oklahoma marks the intersection of four highways—270, 60, 281 and 51—and makes Seiling the “Crossroads of Northwest Oklahoma,” according to the Seiling Chamber of Commerce.
Ward lives in Oklahoma City today, an easy drive from his place to those of his children and grandchildren.
He came to the big city by way of Chesapeake Energy, the iconic shale gas producer that Ward founded with Aubrey McClendon.
“We did quite well as non-operators in about 600 wells that we participated in together,” he said. “Then we decided to move into the drilling phase and form Chesapeake at that time in 1989.”
Ward was president and COO; McClendon was CEO and chairman of the board.
McClendon was “extremely good at being able to raise capital,” Ward said.
“He took care of more of the financial side, and I was more in operations, but he taught me a lot of ways and just how financially to run a business. It was inspiring to see him be able to really communicate well with lenders, potential lenders and equity holders.”
There were plenty of opportunities to drill productive wells and grow the company, but access to capital was difficult. In February 1993, Chesapeake was one of the first E&Ps out of the gate to file an IPO. No others had been filed since the 1980s.
“There had been a long period of time without any new money coming in. And as that market opened up, it allowed us access then to high-yield investments and more equity offerings as we did better,” he said.
Growing the company took time and years to build, “but then we did have some enterprising people that we worked with that were able to unlock some of the early keys of horizontal drilling,” Ward said.
In 2006, Ward left Chesapeake and, with $500 million, bought Riata Energy and renamed the company SandRidge Energy.
Ward and McClendon had worked together for 24 years when Ward chose to pull up stakes. McClendon said in 2007 that he had known the day might come when Ward would choose a simpler life.
“I admire Tom for lots of different reasons,” McClendon said in an interview with The Journal Record, an Oklahoma business publication. “The words that describe him best would be intelligent, very hard working, ethical and determined. At the end of the day, he has excellent business sense.”
Leaving Chesapeake was a tough decision, Ward said, but the company had grown so large—with almost 100 rigs running—that his management style no longer fit.
“It just became untenable for me personally to be able to keep up with all the activity that was going on,” Ward said. “We’d had a very good run. It was a very difficult decision because I loved the company and I loved the people that I worked with, but it was just better for me personally to move on.”
Inside of five years, SandRidge was a $10 billion company and Ward chose to move on again. In 2018, he launched Mach Natural Resources with capital partner Bayou City Energy.
He has grown Mach through a series of acquisitions. In April 2018, Mach purchased Mississippi Lime assets in Oklahoma from Chesapeake, including producing properties concentrated in Woods and Alfalfa counties.
In 2020, Mach acquired upstream assets from Alta Mesa Holdings and midstream assets from Kingfisher Midstream as part of Alta Mesa’s Chapter 11 bankruptcy process. Mach followed up in 2023 with an $815 million acquisition of central Oklahoma assets from EnCap-backed Paloma Partners IV.
The company holds about 1 million net acres of Midcontinent leasehold in its portfolio today, and it has consistently outperformed Wall Street estimates since it went public in 2023.
Mach runs a tight ship, modestly growing production while keeping costs down. At the midpoint of this year, the MLP’s capital expenditures were coming in 30% below Wall Street forecasts. The end result was distributable cash flow close to $67 million and a declared distribution of 90 cents/share, which equated to an annualized yield of 19% for its unitholders, a value that analysts at Raymond James described as “whopping.”
The years haven’t worn down Ward’s work ethic.
“I think, by design, I put in my time. I still work diligently and understand our company. I expect others around me to do the same,” he said. “I want us all to be able to work with humility and not be arrogant.
“The two different roads that a person can travel are either of arrogance or humility. And the arrogant company can do very well where everybody sharpens their elbows and works their way up and competes with each other. But I also think that the companies that work together can also bring a company forward and achieve their goals.”
—Deon Daugherty, editor-in-chief