Energy Crue
Welcome to 'Energy Crüe', the podcast that dives deep into the heart of industry innovation, entrepreneurship, and personal growth. I'm your host, JP Warren, and each episode, we embark on a journey to uncover the passions and motivations that fuel industry leaders as well as industry trends. We're not just talking business here; we're exploring the personal drives, the triumphs, and the challenges that shape today's pioneers.
Energy Crue
Energy Crüe/Facts Chats Mashup: Energy Insights from Ryan Walker and Mike Umbro
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As we delve into the future of energy, prepare yourself for an enlightening discussion on a subject that is pivotal to our everyday lives. We're joined by Mike Umbro and Ryan Walker, a seasoned lobbyist from DC, who lends his expertise and insights on the necessity of energy expansion over mere transition. From oil and gas to the petrochemical industry, we'll explore the importance of natural gas in the energy landscape and how projects like Mike's solar geothermal venture are shaping the future.
The energy industry is an exhilarating frontier of innovation, problem-solving, and entrepreneurship. However, communicating this exciting landscape to the public is a challenge that needs addressing. We’ll be shedding light on this aspect, discussing the role technology and policy-making in Washington can play. We’ll also highlight the invaluable contribution retired industry professionals can make, and how lobbying and public affairs can prove instrumental in spreading the word.
Lastly, we'll navigate the complex waters of compromise and energy security in America. Could a willingness to compromise within the energy industry lead to lower rates and a brighter future? We believe so and will discuss how this can be achieved. We’ll also emphasize the importance of engaging with the younger generation, whose votes will guide the future of energy. We’ll wrap up with some realistic dialogue on energy and how public utility commissions can ensure public services. Join us for an episode that promises to be as enlightening as it is engaging.
Preparing for the Energy Expansion
Speaker 2So , I've seen people do that . Hold on me a little bit and welcome to new energy facts . Chats with me , JP Warren , and we are actually recording this in person at the petroleum club of Houston with my brother from California . Any time now , Mike , you want to check .
Speaker 3Hey come bro , where are we ? You got to bring me in here . I don't want to cut you off . Wait a minute , Wait a minute .
Speaker 2We're being interrupted . Special announcement this is also a joint energy crew podcast , which is my other podcast , just because I think right now who we have ? Right now we have Ryan Walker , who just came on the podcast , energy crew podcast , which I thought was an amazing discussion I had with you , and we also have my buddy , Mike Umbrough , from California , coming in town to speak at the SBE conference . And you know what ? No better way to have some energy conversations , Talk about energy facts chats , where our goal is to bridge energy expectations with energy realities , and also energy crew just a couple of cats sitting around talking energy , any of those things that inspire us . So obviously I want to thank you all for coming flying in meeting us in the middle in Houston for this special episode .
Speaker 2It's great to be here . It's a good scene . A good scene , even in person , I know right . Yeah , it's not that I don't mind doing like Zoom podcasts . You got the audio , you got the video and all that stuff , which is great , but you don't have the interpersonal Right .
Speaker 4You know what I mean .
Speaker 2You got to have the interpersonal , the banter , the read people and talk people . So that's what I did . We also have my producer over here .
Speaker 3Producer Eric Burgers in the room , one of my partners in our geothermal project in California . A wealth of knowledge , a walking encyclopedia , and where is he from originally ?
Speaker 1Oildale .
Speaker 2Oildale and now he's a resident bakers field , which I love that . So you know part of the . I think we're Look this . Yes , this is an energy crew podcast , but I think I'm going to take this down the road of energy facts chats just because I think you know with your background , ryan . You know Ryan . For those that don't know , ryan is actually lives in DC for the past 20 years , 22 . But who's counting ? So bad at math In the industry of engineers ? I'm bad at math .
Speaker 2But , yeah , so in DC for 22 years and kind of you know , we had an episode with him where he kind of shined some light on what it's like as a energy policy lobbyist in DC Very fascinating stuff , and it kind of , you know , you never really have the chance to talk to someone who's kind of a lobbyist , you always just hear about it . So to actually , you know , put a face to the profession , face to the name , is very awesome and I appreciate that . And Mike , you're in town talking about some , what do you ?
Speaker 3do in town ? Solar geothermal . We're talking about moving our energy systems to the next generation , so we are presenting our project at the SPE conference in town here , speaking with you all hanging out , having dinner tonight at your crew event , of course , sitting here in the petroleum club , so that's always fun . Kind of brings me back . I think the first time we met was doing one of your energy crew podcasts . Really .
Speaker 2In that dining room .
Speaker 3Wasn't that the first one ? Yeah , I think so . I think so .
Speaker 2And now look at us Now look at us .
Speaker 3Tag teaming on energy Tag teaming .
Speaker 2We got a 3.2 review on Spotify , so if you're out there , listening to . Spotify and leaving us . We know Bob's not doing that .
Speaker 4Bob's a five star he looks yeah , oh yeah , oh yeah .
Speaker 2Bob is his neighbor who listens to this . So , bob , you're tuning in .
Speaker 3Yeah , how you doing yeah .
Speaker 2We hope everything's all well . So what's going on right now in the energy space realm , right now In the energy fact-chast discussion , you guys are having a hurricane currently .
Speaker 3Yeah , a quote-unquote hurricane . It was just a lot of rain .
Speaker 2Okay , hurricane .
Speaker 3Hurricane .
Speaker 1Yeah earthquake in Ohio yeah .
Speaker 3It was really just it would be good weather for you Houstonians . It wasn't that big of a deal at all , okay , but we got here on time ready for the show and I have a question . We kind of talked about it a little bit at lunch but I think and you know this is one of my pet sayings or warnings that the policy is spreading and the policy in California , I believe , is very much mirrored in DC . So I would love to kind of kick it off with something , some discussion around what we can share with .
Speaker 3maybe some listeners here in the Texas area and maybe there's Speaking of storms . How should people be preparing for the next five years in energy , in tech ? Let's start in Texas specifically .
Speaker 4Well , look , I've been in DC for 22 years , been in politics for that long and seeing where things are going now people need to be prepared because there is a People talk about the energy transition all the time and it's a . I don't see it that way . As I told you guys before , when we were having lunch I said , look , I see it as the energy expansion 100% .
Speaker 4There's Republicans in Congress for a long time have constantly said we need to have an all of the above approach , and I think that that's just gotten a little bit cliche , even though there's still truth to it . I think that we need to be talking about it in terms of an energy expansion , because we need every form of energy , because global energy demand isn't going down by any means . So I think what people need to , especially in the oil and gas industry . There is a constant attack on the oil and gas industry , but the fact remains is we're never going to be without oil and gas , because we're not . We need the petrochemical industry , we need natural gas and you can obviously create blue hydrogen out of natural gas . So there's all these different uses , but the oil and gas industry needs to , in oil field services , that anyone associated with the oil and gas industry needs to have a voice in the process to make sure that they're not shut out , not scared to engage in the process .
Speaker 2My question is okay , if I'm sitting there , if I'm sitting there on the sideline and you're , and I'm saying I'm hearing this , you got to be prepared for what's coming down the tunnel . Number one how do I have a voice ? Number one but number two how do I prepare for something like this ? I mean , what do I have to do ? Circle the wagons , start buckling hatches out ? How do I prepare for the next five years and how do I get involved ?
Speaker 4Well , one is just , I mean from a very basic level , and I guess , as we talked on the Energy Crew podcast , this is my public service announcement to everyone to get engaged in the process . Vote Elections have consequences when the party in power is determining the direction of energy policy in this country , and there is often I think that it's no secret that there's this political divide between one party and the next , and I think that there needs to be an education process . There needs to be a voter contact process by people educating voters as to what the energy realities of this country and the world are .
Speaker 2Well , what sucks is and this really does suck is the fact that , look , there's always gonna be different political parties , different political views . That's what makes everything so spicy , that kind of gives the ingredients of life . But the fact that energy has taken kind of this camp mentality or this camp mindset , you have to pick one or the other . To me that is such a regressive mindset and it's not realistic to think that you have to pick one versus the other when it should be . As we talked about at lunch and I don't mind rehashing a lot of lunch conversations that we had too we need it all , and there's a huge component about that that's not being communicated to the everyday consumer or to the families out there .
Speaker 3One thing that you mentioned at lunch that really struck me and we talk about it in California is how are we allocating our time and our resources for that expansion ? And in our case , we're talking about taking what is traditionally thought of as an oil reservoir and making it a geothermal project and storing energy and adding meaningful , reliable energy to the grid allocating our time and energy as a small operator for that project of the future that our policies are supposed to be supportive of ? And I think that's one thing specific to places like Texas and you mentioned it these oil operators , oil and gas operators , are making a lot of money at these prices , and how are they allocating their resources ? Are they paying back shareholders , which seems to be what they're doing ? Are they buying back stock , which seems to be what they're doing ? But are they spending money to educate voters ? Are they spending money to get out in front of or you can't say in front of to start playing the game that the environmental activists are playing really with policymakers alone ?
Speaker 2There's really a back . We always just tell not a story , that's really it . It's not playing , it is the game and all that stuff . But for me it's just kind of providing kind of the
Current Energy Industry Landscape and Challenges
Speaker 2story . What makes our industry so cool ?
Speaker 2And again , going back to our industry , like it is such an archaic , dusty image , I mean you got the uneducated roughneck and you got the 75 year old white haired dude dumping dirty oil behind an orphanage . But in reality I mean there's entrepreneurs , there's tech geniuses , there's engineers , there's problem solvers . I mean we talked , we were at lunch and you were saying , look , I'm never gonna retire because I just like our industry like it's working , we like solving problems . So again , reintroducing who we are as an industry , I think is also a pretty important piece to it . But the piece that's not being communicated is that other side , the energy . If we let's say this trains , I don't even wanna say that word but let's say we remove all the way from away from the hydrocarbons and go strictly on this stuff , that doesn't change the fact that my house , to cool it , requires this amount of input . This still requires this amount of input . Whether I like it or not , the realities .
Speaker 4People are only getting the information that people are putting out there . So the oil and gas industry , the oil field services , anyone associated with this industry , you can't sit on the sidelines , and there's only so much . And they're doing all they can . The APIs , the AFPMs , those trade associations in DC . They're doing a good job mounting the loyal opposition , so to speak , and but there's only so much they can do . There needs to be other entities outside of direct . It can't be API led , it can't be Chevron led , has to be separate . People can help fund that , but there needs to be a concerted effort to get people educated about the energy sector .
Speaker 2So we're just okay again , we're just one start . If I'm in my car listening to this and I hear you say that , I'm like you know what I like that , ryan , that was a good point . Now what ?
Speaker 4Now , what is the now ? What is ? You know , there's folks like myself who've lived in Washington for years and years and while all of the engineers they've mastered their craft by being great engineers drilling great wells , but where we in Washington , we've spent our time learning , as we talked about , the four Ps the people , the process , the politics and the policy and how to engage that process , both from a policy perspective but , more importantly , a political perspective . And you know folks like myself and my partners at Shoemaker Advisors , we can help those companies engage , you know , either from a lobbying perspective , a public affairs perspective and so that people can get their message out , or you know , when it comes to lobbying , that , as we talked about , you can either take an offensive posture or a defensive posture , and it's just depending upon what the ultimate goal is for the organization .
Speaker 3One thing , and maybe this is a bit of an idea , but I've talked to , through our group , californians for Energy and Science , and I've talked to our members about how do we reach the community and how do we get engaged and who spreads that message . We're all trying to work at least me , you know . I got a full-time job trying to develop a project and I mentioned to them , you know , retired teachers . They care about their communities , they're in , they care about education , but maybe , as an industry , one way to you know broaden that scope is maybe it's as we say , people in our industry don't like to retire , but maybe it is . We hear about the talent gap and big crew change in oil and gas .
Speaker 3Maybe it is providing a platform for those executives and those engineers and those people that are leaving the industry . Hey , they continue to stay involved because nobody wants to just retire and sit at home and watch Judge Judy . You know they're gonna wanna do something , so , but how do you organize a framework , a structure for people to be involved in that kind ?
Speaker 4of an out . And to your point about you have a full-time job . You know all of these . You and others in the industry are all running businesses . Oftentimes , you know you don't have the internal departments like some of the bigger guys do to . You know , have in-house government affairs people or in-house regulatory affairs people . You know that's where we come in and we help companies , whether it's one company or you know a group of four companies that wanna band together or something like that , so that they can , we can act on their behalf , and that's the thing I mean that's another thing we're talking about too .
Speaker 2It's like , when it comes to the realities of what the human race needs right now , when it comes to energy , we have you know we . However , you're up in DC , you know you're in California . You are in two of the most hot , politically energy focused environments I can imagine right now . Okay , all right .
Speaker 2That being said , all of your efforts , ryan , all right . So you're , it seems like all of your efforts , especially what's going on today and all stuff . You too , mike , with California's Energy and Science . You know , I read this interesting statistic that there was , you know , five years ago , about 15,000 permits and 1500 , yeah , new wells drilled .
Speaker 3I'm not a reader either , that's okay that's okay .
Speaker 2No , I'm joking . My producer , eric , I told me that . And then what ? There was how many ?
Speaker 3Seven , seven this year , seven this year , so All based on 2022 filings that were just trickled in . To permit a couple of wells .
Speaker 2Okay , so being in the hotbed in DC and being in California , seeing , you know , 1500 to seven , I mean it's this constant . Wake up . It's this constant . I want to do something . I want to do something impactful . First off , what's keeping you all going ? But second off , are you seeing kind of the landscape look more optimistic or is it just kind of a little more pessimistic every single day when it comes down to the energy realities ? And that's a good question .
Speaker 3I'm an optimist .
Speaker 2I'm different than our producer .
Speaker 3Eric .
Speaker 3Yeah , yeah , yeah , come on in , you got something to say I see us having to break through the doldrums of just kind of a ridiculous posture . Right , nothing is not an option . You cannot permit nothing and expect that the industry can improve , whether that's a transition , expansion , whatever you want to call it . You can't do nothing as an agency and expect change . Right , how can you better the environment if you don't permit anything ? You really can't . It's not going to happen . I believe that it will still require a crisis of supply or pricing or both .
Speaker 2So you're looking for the energy boomerang to happen ? Yeah , I think we're .
Speaker 3I think we've thrown that boomerang out . It's coming back eventually , but it's still far away , right , if that makes sense ? Yeah , we're still . And this is the time to Ryan's point about getting engaged , and , as these conversations are spinning around DC and Sacramento , if it's just a couple of people engaged , we're going to have a much longer fight on our hands . If suddenly we see bigger operators get more engaged and start showing their voices more , then I think things start to move a little bit .
Speaker 2But I wouldn't even say that falls on the bigger operators , that just kind of falls on . Well , that's all that's left . Okay , nevermind .
Speaker 3So two-chip , I mean , that's kind of all that's , you've got bigger operators and then literally companies just kind of folding up and how do we ? How do we produce these wells and then plug them ? That's the mentality right now , and we were when I started my career . California was the number three producing state in the country . Now we're eight and falling . So that's where I continue to say don't think , this cannot happen to your state .
Speaker 4And that's what the point that the point I'm trying to make is that look to , you're exactly right . There are factions out there that want to shut down the oil and gas industry completely , a hundred percent , full stop .
Speaker 2And that's why engaging the political and the legislative and the regulatory process In some way is so important for for companies to do , to have a voice in that process , because without it then you become a victim to what the government just does to you right , go in on that a little bit , only kind of peel that back a little bit , because a lot of times you know I think you know it's 2023 right now a lot of people believe that you know , if the government comes out with something like , obviously it's okay , you really can't have a voice to any opposition towards it , or something like that . So you say don't be a victim to that , so . And that's actually kind of engaging with with the politicians , engaging with your local and national Representatives , correct ?
Speaker 4Yeah , absolutely . I mean , look , we , we're two maker . Advisors were bipartisan firms , so we'll talk to anybody on either side of the aisle . It's not it's about . Look for us it's is it's as much of it's even more so about what the company's goals or the organization's goals are . It doesn't . It's not about Red or blue , per say . It's about but engaging the political process and understanding the politics of it . You know you're you're writing comments to notice the proposed rule makings . Your You're going and talking with members of Congress and there's and their staff who are the subject matter experts . You know you're going in and talking with career folks at the Department of Energy or Department of Interior .
Compromise and Energy Security in America
Speaker 2Do what you do , do you ? I guess you always have , you always have to have some sense of optimism . I guess I do look , I and people .
Speaker 4You know it's not I don't operate with rose-colored glasses by any sense of the imagination , but what I do believe in is this country and I believe in the Republic . We're the best form of government on on the planet and I think we have a bright future . But it can't always be a zero-sum game . We have , you know , the the where the District of Columbia is , is geographically , is a was an effort of compromise between Jefferson and Hamilton . So there are . Our country is founded on some level of compromise . You don't have to give up your principles , but you know you don't have to give up your core beliefs , but you know Ronald Reagan , I think , is the one that said look , if you're , if you're with me , you know 80% of the time you're bought , you're my friend and and you fight for the the next 20% . You know it's not always a , an all-or-nothing game , so to speak .
Speaker 3I think that compromises a key word and that I think , going back to my spirit of optimism , it is compromise in that , as a developer or an operator , we can go to policymakers and say , hey , look , these prices at the pump are not , are not sustainable , they're not good for the people of California , they're not good for your constituents , and they will get angry . And I've said this in Committees in Sacramento . When I've been asked to testify for Shannon groves pieces of legislation , I've said to them look , this is something that's going to fall on your shoulders when people are paying $10 at the pump . Or how can we help you utility companies , public utility Commission , how can we help you bring rates back down ? Nobody seems to be talking about bringing rates down . That's a winning bipartisan Compromise type of a solution .
Speaker 3And then , on top of that , as an industry , we all have to be comfortable going into what you perceive as hostile territory . And I , you know myself , I was just invited to lecture at a guest lecture at UC Berkeley . Of all places and people , when I tell them that , even in Bakersfield , oh you know , the initial reaction is like we don't like Berkeley because we hear so much of the of yeah Movement to shut us down from Berkeley . Well , that's where you have to go to Teach the students what the realities are of their future career choices , of their future donations to political Groups , of their participation in NGOs .
Speaker 3Yeah they need to understand that the energy systems in California are Powering the fourth largest economy in the world and it cannot be done by one single technology . And why can't it not be done that way ? And you have to explain that to people in a spirit of compromise , of saying , hey , this is an example of going back to our project , it's what I know best . This is an example of compromise . This is an example of a traditional oil operator coming to you with a clean energy project to Bring your rates down , to give you reliable energy at night when you don't have it from quote-unquote Renewable right . So it's those kinds of things that we need to start stepping up and entering these forums that we perceive hate us , but just go .
Speaker 2You know it's not that big of a deal . I've always heard you make the most amount of change by getting involved . I mean , yes , you can send the sidelines bitch griping , complain about something , but that's really not gonna change the the course of direction unless you kind of get up and start right getting involved in a little bit . And yeah , I think the first , I think that's awesome . You know , you know it's it's funny . You know , you know , whatever is , whenever it's like Denver , like you know , you know . You know , when I go to these cities , like , oh , you know why you want to Denver , they hate the one . We guys I'm like that's where we should be staying when places that are so at first off in place to get their majority of their taxes from the only guys . You know all that stuff and it power . It's such an important powerhouse to the people of the the state and all that stuff , people knock it , they poo poo it , they're like oh , I get out there gather .
Speaker 2That's what you should be . I mean , you should be there to educate the community . You should be there to kind of talk to the people that are against you , talk , sit across the tables . I'm like , oh , wait a minute , maybe this person isn't that bad of a person . You know , like they're trying , they're on the same boat . We want to provide for our families , for we want to have some money at the end of the day . So I don't think you need to shy away from these places that are kind of opponents of of yours . If anything , it's an opportunity to kind of reach cross table and shake a hand . You know absolutely .
Speaker 4Absolutely a hundred percent so , but we also need to not just Talk amongst ourselves in the energy industry and renewables and whatever else . We need to talk to and engage and educate the youth , because they're the ones that are going to be voting , you know , in in six , eight , ten years time , and right now the energy and the energy industry message isn't getting to them not at all .
Speaker 3It's not , and they don't know what they don't know . They don't know what they hear , you know . If they're on tiktok , if they're on whatever platform they're getting their information from , the algorithm is just feeding them what's you know , firing their brain . You know it's just feeding you what you want to hear .
Speaker 3I mean , and so when you present them with facts and what's different , it really doesn't trigger them . I mean , I've had students that I've presented to at Berkeley in the past that they've come up to me after the presentation . I've said , wow , I really didn't like oil and gas before this , but now I don't know exactly . Things are turning , things are happening , that's different and they like that , they like challenge .
Speaker 4Because at some point , I mean , we can talk amongst ourselves all we want , but at some point , if we don't get our message out to the , to the up and coming generations , we're not gonna have any engineers to you know , get it out of the ground . And you know , and as we , we need to educate young people , old people , policymakers , because it's also about energy security .
Speaker 2What do you mean by that ? There might be some people out there that have heard energy security or like it's a topic point For those that are out there that might not be following you . They're just too dis because they got two dudes on there . What is energy security and why is it so crucial ?
Speaker 4Well , I think it's important because look I mean as you look out the windows here , do you see the energy capital of the world ?
Speaker 4It's no secret that not everybody likes America , and you have an award going on between Ukraine and Russia right now that has energy implications to that . So we need to be able in this country to be secure with our own energy . To produce enough energy is one , but if you don't have , you know , you can produce all the energy you want , pull all the oil and gas out of the ground , produce as much electricity as you can , but if you don't have the refining capacity , the pipeline capacity , the transmission capacity , all that's for naught , because you can pull it all out and create it , but you can't send it anywhere , you can't get it to people . We need to be able not only to produce the raw material but able then to process it into transportation fuels , electricity , whatever form of energy people need , so that we can feel secure in our country that we're not dependent upon foreign sources of energy . I hate to sound so political when I say that no , no , no , no .
Speaker 2But that's what we've been talking about energy facts chats , yeah absolutely . California is the prime example of that NIMBY mentality .
Speaker 3We're an import state . We import 75% of our crude oil . We import what is it ? 30% of our electrons . Now , we import everything because we're pushing it all out , and what that creates is a dynamic where you're vulnerable to supply and price shocks .
Speaker 2So , speaking of the whole NIMBY mentality is colliding . I just saw that Ecuador voted no more , I guess , an indigenous tribe , no more drilling on their land , or something like that . So you have , when California is getting their oil from Ecuador , now Ecuador is not from . So what's I mean ? You're gonna keep on kicking the can down the road . What's gonna happen ?
Speaker 3Yeah , we're gonna kick it over to Guiana and we're gonna buy it from another country producing it out of the most biodiverse region in the world , in the name of climate action ?
Speaker 1Yeah that's exactly what they have .
Speaker 3They're Ecuador and then , by the way , ecuador is gonna be overrun already is overrun by the drug lords and then all the people fleeing Ecuador will come and live in California and Texas because they wanna get out of that hellhole . And so now we're burdened with financially supporting a people that are fleeing a territory that is destroyed because we let China exploit the people of Ecuador for their oil to go to California . So now the people of California , unknowingly , pay for all of it .
Speaker 4That's awesome .
Speaker 3Yeah , that's how it works , and the people have no idea . The general public has no idea that that's what's happening . They have no idea that our number one supplier is Iraq , where they flare six times the amount of gas that we produce in a single year . And that just goes to the one atmosphere that we all share .
Speaker 2Though , as Chuck Yates says , there's no P zone in a pool , right , right and kind of bringing it back to how we start .
Speaker 3You know , spreading awareness is . I've tweeted to Chuck and the BDE and the digital wild guy like come to California . More people around the country need to come to California to see what it is like , to see the level of homelessness in our cities , to see how these policies manifest themselves and how , ultimately , the people are paying to support it .
Speaker 2So it was interesting . So I just went to California I'm a father-in-law out there and went out there and lived right next to , you know , close to the airport . Beautiful , there was , like this , national wetlands and all that stuff , but anyway , there's all these RVs . Yeah , is that the Winnebago ?
Speaker 3I mean , if you want to talk about RVs RVs with tarps over , it's gonna be no longer a cruise .
Speaker 2Yeah , anyway they were all along the wetlands and all that stuff and like , first people are like , oh , that's great and all that stuff . But next thing , you know , it's like okay , well , this is happening . There's ATM machines in there , there's , you know , there's , you know , human feasts , you know all this bad stuff happening . Well , for the sake of you know , they use the environment to kind of clean it up there and we went to a day when they came back they were gone . I guess they were moved out . After months and months and months . It's gonna take that little wetland area 10 years to get back to where it was , Just cause people were crashing on it .
Speaker 3For that long , so you brain yeah Well , and that's kind of why I see the boomerang is more than just energy . For example , where I'm at in San Diego , they've said you cannot camp on the street if there are beds available . They're seeing what's happening in San Francisco and saying we don't want a failed city of San Diego . It's beautiful here . So we're gonna change this whole situation and that's starting to happen . So I think the same thing will happen in energy , where people will say well , all I breathe is tanker air in the city of Long Beach . I don't wanna breathe tanker air anymore . Once they realize why that's happening , they will start support to support drilling in Kern County . It will come back . It's just gonna take education time , the unraveling of poor policies , all of these things coming together .
Speaker 2What's been some Ryan go to you in DC , what's been kind of some of the biggest conversations that you can disclose with us ? Obviously the conversations that you're kind of hearing around the table and maybe some misconceptions , that kind of like you're hearing . That you're like if I can just tell everyone just knew this one piece of information , that's what would this be ? Does that make sense ? Does that question make sense ?
Speaker 4Yeah , but it's not . It's , but it's not just one thing , right , like , look it's , earlier this year we had , for the first time ever , permitting reform . That happened Now . It was a small piece , but it was a small piece but a big step . I mean , you have Speaker McCarthy , who's your congressman , is a lead on this effort , him and Congressman Garrett Graves . They engaged in compromise and in negotiation and got the first permitting reform done that we've had in I don't know decades .
Speaker 4Maybe Now more needs to be done and they realize that and they're continuing to work on creating more permitting reform , specifically as it deals with the ENGO's litigation efforts and how long those can go on through the judicial process and kind of dialing that back , so
Challenges and Impacts of Energy Projects
Speaker 4to speak . But I mean , look , you have all of this government money that's out there through the infrastructure bill and the IRA , but you can't get it out because it takes 10 years plus give or take to get a project going Well , when I , whether that's traditional fossil , it takes a hell of a lot longer . But if it's renewable , it still takes a long time because there's constant environmental impacts statements , environmental reviews , now all those are important but they sure as hell take too long .
Speaker 2Well , the thing is , we live in such a time where it's immediate gratification . If I wanna order something right now , I'll get it in two days right .
Speaker 4Or a day if I'm a prime , whatever .
Speaker 2If I want something , this like , you know , like if I wanna see a movie , well , it's not on demand that I'm not gonna . You know , like we live in such a world of instant gratification and when you're right , when it comes to these energy projects , when it comes to the infrastructure , when it comes to the , that's not an instant thing . That takes time .
Speaker 2It takes time , energy , effort , money , capital . It takes a lot of stuff , but it's not like if something happens where we Same thing with policy , policy well , we are . If we do get in a bind , it's not like we're like oh , let's just go to our friends over here . Things take time and that's why you need to start these conversations with people that might not have the same viewpoints and just have conversations , just have friendly conversations and just kind of educate and , yes , also go into the policy level .
Speaker 4Yeah , I mean , and you can have policy changes that take years to manifest into public law or some type of regulatory change , because it's you have to change . It's as much as you can educate people saying look , no , here's scientific facts , here's why this is important , but it's the political process changing hearts and minds that ultimately affects the change that we need .
Speaker 2It's such a it's like you say . I completely agree 110% like 100 , but it's like , it's so funny , it's like the brush and the lens that's been put on hydrocarbons .
Speaker 2And it's a life source , to like everything . I'm looking at a hospital , like people are live because of the , the byproducts of hydrocarbons , ambulance helicopter , whatever you want to call it , but when it hurts my I don't even know like , yes , there's a lot of places to start on stuff , but it's like , how do you even tell us , how do you even like tell a story that kind of highlights the pros and cons ? I mean , it's just , I don't know , it's a huge undertaking and obviously we're here to just part of it , but it's one of those things like you wake up and you can't think about the whole problem . I guess you have to take it in bite-sized pieces .
Speaker 4Yeah , what's the saying ? Like how do you eat an elephant one-sided ?
Speaker 2at times , I guess so , I guess so .
Speaker 4So and that's what's being done in DC and in Sacramento and other state capitals around the country is that we are lobbyists like me who are trying to help companies affect positive change , to help people make sure . I'll go back to when I first interviewed one of the oil majors that I was employed at . I worked at BP . The then US CEO came in and said , look , understand , you want to work here . And look , what we do here is we light , heat and move people by providing them with reliable , affordable and abundant energy . And I'm like , damn , that's something I can get behind .
Speaker 2Yeah , yeah , yeah yeah .
Speaker 4So , and that's what I think that people need to understand is go back to basics , go back to the X's and O's , blocking and tackling it's . You know , what's your energy reality , what is the energy ?
Speaker 3reality .
Speaker 4We need to tell people that Right ?
Speaker 3Do you want to be able to afford your energy Right ? Do you want to be able to pay your bills ? Do you want the government to pay your bills ?
Speaker 4Do you want to like to show your rates ? Like Germany ?
Speaker 2Yeah , I mean you're talking . I mean the thing is you're talking about you know the East and West Coast right now . But I was at a crew club dinner in Oklahoma and from the other side of the table , some cats like hey , is there anyone else's electricity bill ? Yeah , I'm looking , I'm like wait , shit , mine is . Mine was almost 600 bucks this month . Yeah , yeah , yeah it's . I mean , just like I did that tweet , like like $600 .
Speaker 3Yeah , it's unsustainable Almost .
Speaker 2Unsustainable . But well , here's the deal . Here's the deal . Yeah , first off , it sucks . Okay , yeah , like I'm just throwing it out there .
Speaker 2That's a legal term . It sucks . But the second thing I want to throw out there also is that hurts . I mean , think about this . I mean I am fortunate , I'm blessed , I'm in a situation where , yes , that does bite me , but it doesn't leave a mark as big of a mark I'm thinking about . You know , there's people out there that are doing paycheck to paycheck . You know whether it's whether it's . You know the baristas whether it's .
Speaker 1You know whatever you know , like whatever it is , I mean that's a lot Right .
Speaker 2I mean when that bill goes up that much and it's not affordable , it's not reliable and all that stuff . That's a huge issue for the majority of the consumers out there , the people .
Speaker 3Right , and it goes to governance , and a lot of times we think of ESG as governance . But what about governance within the government and the administrative state , as Eric mentioned , being bloated and not doing its job effectively ? People are struggling to pay their bills , people are struggling to stay in their homes . So now you quite literally in California , have a situation where , if you are a landlord or you have one rental property , people literally don't want to rent their homes out anymore because the tenants who can't afford to pay the landlord can stay in the home forever . Yeah , they just stay . You can't evict people anymore .
Speaker 3So now people that own rental properties are like I'm just going to sell this stuff . Well , they're selling it to either you know flippers who are inflating , you know doing all the work and making the prices go up , or they're selling it to selling properties to developers , and it's it . None of this . None of this helps the individual and , and probably worse , none of this helps the individual that's either recently retired or coming out of school , and those are kind of the the classes of individuals that get impacted most by regressive policies that hit their pocketbook .
Speaker 4But if you get into the mindset of , I guess , of the average consumer , it just kind of confounds me every time I think about it . But you think of these people expect more from a customer service aspect from the Amazons and you know the , the Apples and companies like that , then they do their own government Right . There's a lot of people are just rolling over and not expecting the customer service from places that they should expect it from .
Speaker 3Yeah . Yet when the box comes up they'll say do I tip 20 , 30 or 40% ? It's like what ? And people will be like I'll pick 20 .
Speaker 3That's like what I grabbed it was 10 to 15% was a good tip , and that's kind of emblematic of all of this , where people are so just trained to go with choices that are actually not benefiting them whatsoever . And I think that kind of goes into back to all the climate discussion and bettering the environment and what we all want to do , but everybody's making these decisions that don't actually benefit the environment or themselves . But they expect change and they expect these big bad oil companies to make it all go away .
Speaker 2I mean , it's easy whenever , whenever the villain is this faceless , nameless big creature , oil company . It's like , I don't know , I'll just yeah , it's a place to be .
Speaker 3Yeah .
Speaker 2What else should we touch on ?
Speaker 1Topic from the gallery , the one point that didn't get melded in in any of our discussions . It deals with the amount of money that is associated with those 1500 wells that didn't drill . That's between one and three billion dollars of capital investment and associated maintenance . So it's another one and three billion dollars Jobs too , the only suck out of the central California is economy .
Speaker 2You want to repeat that because you have a mic on them .
Speaker 3Yeah .
Speaker 3So pretty much out of those 1500 , go ahead Out of 1500 permits that are no longer being issued on an annualized basis . You're losing between one and three billion dollars of revenue , of job creation in one part of California , in the central valley of California , which is wholly dependent on agriculture and oil and gas or energy . Now we lead the state in renewable projects as well . We do it all in the central valley and it's drying up the income base . What does that do ? That trickles down to folks that own restaurants , folks that own coffee shops , folks that have upholstery businesses , folks that are decorating people's homes , whatever it is , their costs have risen as well and meanwhile your cost of living is going up .
Speaker 3Meanwhile you're importing the product from elsewhere , While at the pump you're now paying $5.50 a gallon instead of $3.50 a gallon like it is here . And somehow Californians are coerced or manipulated into believing that oil companies only gouge Californians because somehow , magically , we don't realize that there's $1.20 to $1.40 per gallon in taxes being added at the pump to the people of California while we're limiting our own supply . So it totally distorts the economic picture in a very negative way for the lowest of wage earners . And oh , by the way , those jobs on those rigs that we're losing are six-figure jobs . Those are $120,000 a year jobs to people that don't even have a high school degree or that just came out of prison , because that's who the oil and gas industry employs . They employ anybody that wants to work , and that's what we're losing is this idea of work . It's hey , we need the government to just give you a check , to sit on your couch and drink beer , that's it .
Speaker 2I love when he goes on these things because it's spot on .
Speaker 3Well , it's unrelated and I think the great point that he brings up because we talk like my buddies in California is for energy and science . There's drilling rig companies , there's drilling mud companies , there's pipe companies , there's directional drillers , there's people that wash rigs , there's people that dewater . There's so many service businesses around each permit that is being issued . There's biologists , because oh , by the way , we look at every endangered lizard walking around any oil lease .
Speaker 4But let me just kind of put a capstone on this . If you will , elections have consequences and if people aren't involved , you get the government you elect , and all of this that we're talking about could be one huge , large moot point if there isn't a concerted effort to get the message out , to educate voters about the energy realities that are happening all around us .
Speaker 1Right . One other thing to talk about , if you want , is the public utility , as you mentioned the way in which it has allowed rates to be structured . I don't know if you're aware of this one . The state of California has the second highest electric utility rate after Hawaii , which is a disaster .
Speaker 4I wouldn't have thought California was first . It's not , it's second .
Speaker 1But what's interesting about when you buy a kilowatt hour of electricity or of energy ? In the state of California , the average price for that energy is eight cents a kilowatt . The rest of it , 16 cents of that , 25 cents or more , is transportation , distribution and transportation . Think about what that means If you were to spend $4 for a gallon of gas . You're saying well , of $4 gas , well , three of it has to do with trucking it to the gas station . What absolute malarkey . It's abject rape of the ratepayers .
Speaker 3It's the only way to describe it .
Engaging in Realistic Energy Dialogue
Speaker 3We had Duncan Campbell of Scale Micro . Strids on and he's a great person to describe exactly what Eric's talking about , that these utility companies are making a fortune on the distribution . We as consumers and also we need to demand lower rates , but also we need to expect the utility companies to be out there for the public good . Utilities is something that should be a public service . You should be able to get electrons to your home .
Speaker 1It's a good public utility commission regulation .
Speaker 3It's an important thing . It's all very interconnected , whatever we can expose this .
Speaker 2That's what I love about your perspective , mike . You're very good at connecting the dots when it comes to like this affects this , affects this , affects this . I love how you bring everything kind of whenever you do get on your passion soapbox and you do talk about it , that's them . No , I really do . I really dig it . I do like how you attach it all because whenever you do go on the ranch , I can tell you just want to keep on talking about it .
Speaker 3I dig that , yeah , but it is all connected Absolutely .
Speaker 4And I'll be clear too , is that I'm not . Look , I'm not against any form of energy . Yeah , I'm the , you know , hydrogen solar wind , whatever it is .
Speaker 4We have to have it all because global energy demand isn't going anywhere , it's not going down , it's only going up and we need to have every aspect . But you know and I harp on this , but you know everyone hates politics because they're inundated constantly , especially in election seasons , but you know there's only kind of political nerds like me . You know people who follow this . You know that's when people need to , I guess , kind of put their head down and power through and engage the process , as much as they hate it or as much as they think that it , that it sucks . You know your voice is important .
Speaker 2But you know what's interesting , like everyone everyone in the energy space , I feel like , is an energy maximalist . Whether you're on the renewable side , like Duncan , whether you're on the only gas space , whether you're in the like , everyone is an energy maximalist . But the thing is , though , you have to have realistic conversation , so you can't be like , oh yeah , we're going to go to batteries . You know all the only gas companies stop lobbying against . You know , you know , you know , you know , you know you , batteries , batteries could overtake . Technology is not there . Technology isn't there . The realities of 2023 , 2020 , 2020 , where we live today , it's not sci-fi . The technology is not there . So let's also engage in realistic conversations about not in . The thing is , though , we had this conversation Whenever you read an article about , you know this battery could do this , it's always could do this , doing this might do this .
Speaker 1Fusion . Fusion could do this .
Speaker 2There's always that catch term could , should , might , potentially , could . Could , should , woulda , could , should . But the thing is that we gotta engage in realistic technology , energy dialogue as well , and that's , I think that's an important piece of it too , because if not , people are thinking like , well , where should we go on batteries ? Well , there's batteries , what only hold what ? 12 minutes , seven , what is ?
Speaker 4it . We can't leave the present behind for the hopes for the future .
Speaker 3I mean we have to take care of the people now . That's a great damn . That's a great quote . When's he running for us ?
Speaker 2Seriously , yeah , ever I got a question would he make a good politician ? Absolutely , that means yes , you would . That was a trick question .
Speaker 4You got you got fact checked .
Speaker 2Would he make good politician ? Yeah , okay . Cause we need one , that's fine if you don't want to .
Speaker 3It's a question . I don't even want to use the term politician Like you would be .
Speaker 4you'd be good . You'd be good in office . Let's just say an office would follow us . I am a man of the people . I'm a man of the people .
Speaker 3You're a man of the people .
Speaker 2You actually you are .
Speaker 4You're one of the people .
Speaker 1Exactly you are .
Speaker 3Well , I'm this way because I'm born and raised in San Diego . It's a beautiful place that I'm not going to leave . So if you're not going to leave , you have to say something .
Speaker 2You can't just get governed into nothingness and this whole process with you about kind of getting more vogue and all that stuff . I mean , that was kind of pretty recently when we , before we first met Cause you started kind of putting in the content of yeah , a couple years .
Speaker 2Yeah , you got out on a boat , went out there and went to the ship and he was like , look , you got all these tankers right here just burning dirty oil or dirty diesel right now waiting to get in . We got pristine shit to take away , we can drill , we can produce over there . Well yeah .
Speaker 3And I was talking to Eric before about this and why I do it and why I think the big companies need to have a voice . Because you have to . You have to understand . I have this mentality because I'm not going to leave . But the general public thinks one , oil and gas companies are responsible for all this . Two , they'll just pack their shit up and leave when it gets tough , which is what Oxy did . They left California with 9,000 Idle Wells . Now they're the darlings of direct air capture and they're going to save the planet . No , go , spend those billions of dollars and plug all these wells that you saddled CRC with Aira , shell and Exxon they just sold out . They've got 9,000 Idle Wells . No , aira , shell , exxon , go back there , plug those wells .
Speaker 2Clean up your camp site .
Speaker 3Chevron . Everybody speculates they're next to leave . All these big companies need to say well , maybe we did manage this poorly or maybe we let the abandonments get away from us , but we're going to fix it with the billions of dollars that we're making and that will start to earn back the social license to operate . Yes , and they're not doing these things .
Speaker 4You and I agree 110% on this . I've told people before that , look , rather than giving money to the Environmental Defense Fund , Cera Club , whatever else it is , go and plug these wells . Now , look , there needs to be regulatory or legal changes , statutory changes about if you go and plug a well that you don't have responsibility for , you shouldn't also have long-term liability for that . There should be some kind of grace period or some way to fix that . But incentivize companies to go and plug these wells that they may not have responsibility for because they are . Everyone talks about ESG now and that's going to be your biggest ESG impact by gaining back that social capital . Right , right , 100% , Exactly agree with you 110% .
Speaker 3And it's not all their fault because , like you alluded to , the regulatory framework allowed that to happen over many , many , many decades . But it's easy for the regulatory agencies to say , oh , we're done . And now it's like , oh , we better just leave , we can't do it all now . And that's not a compromise . The operators and the agencies need to say , okay , look , and maybe it's a two for one thing . Hey , we'll abandon two wells for every one well we drill . Or maybe we'll abandon if we've got a lot of them . We'll abandon four wells for every drill .
Speaker 3Whatever the compromise is , and that is starting to be baked into today's regulatory framework . But when the major companies just pack up and vacate , then that makes them look like they're fleeing a situation , and that's what needs to change . They need to start getting engaged with the people and say , hey look , we're going to fix this . That's it , we're going to fix this . What does every politician do when they get caught sleeping with the secretary ? They go out and apologize .
Speaker 4Not every politician just speaks , not every politician , but I mean , you got it .
Speaker 2It's okay to apologize for something that is partially or 100% your fault , and if they don't , if they walk away from the party and all that stuff , the majors walk away and all that stuff . It's open to interpretation .
Speaker 3So anyone could write the story . Yes , and I said that at the current energy summit last year . I said if the operators are not standing up and talking about this issue , it will get written for you and it will be the Center for Biologic Diversity , the Sierra Club , greenpeace , companies that are or whatever activists that are set up to stop civilization in its tracks . I don't want anybody to thrive . They will be the ones that the media goes to for a quote . Do you want that ?
Speaker 2No , that's a great point Sorry .
Speaker 3You all worked up again . I love it . You do this great yeah .
Speaker 2Love it , not that this guy chiming in yeah , he's always doing it .
Speaker 4He's like I'm gonna get out of this and pop in .
Speaker 2He's like I'll tell you something else 1.3 million dollars , it's a very dynamic episode .
Speaker 3I love it . It's because you're doing the twofer here , the crew and the fax .
Speaker 2That's why , yes , I'm glad you picked that up . More twofers in the future .
Speaker 3I'm down for twofers . Maybe you need to buy me out of energy fax chats for a healthy sum of money .
Speaker 2Dude , what do you mean by ?
Speaker 1that .
Speaker 4Where's the ?
Speaker 2money . It's my MacBook , All right my time .
Speaker 4Where's the money ? See what we talked about . Gotta come to DC . Yeah , oh , it's happening .
Speaker 3Gotta come to DC . Dc field trip . Okay , wife and hour coming , we're going to DC .
Speaker 2And we're also going to California as well in two weeks and we'll be doing . You know what ? I got some ideas that we'll talk offline about that , so anyway , so first off , I wanna thank all of y'all for flying in for this very special podcast . That's the only reason why y'all flew in . It's that important Conversations we have are energy fax chats and energy crew . Is that important ? But honestly , I appreciate it . Do you have anything to leave us with Ryan Mike ?
Speaker 4Look , no , I think from my standpoint , look , it's just . I would encourage as many people to engage the process legislatively , politically , regulatory , as much as you can . Even if you don't have an in-house capacity to do that , make sure you're monitoring it in some way .
Speaker 2And again for our listeners if you have any questions about how to kind of get dialed in and all that stuff we're gonna be linking everyone's name when it comes to LinkedIn and stuff like that Just reach out to Ryan and if that's , I'm trying to get the eyes like yes or no .
Speaker 4Yes , Reach out to Ryan .
Speaker 2Just find out hey , look like if you're sitting there and say , okay , well , how do like , what's the first step for me to kind of get involved in all this stuff ? Just ping them , ping Ryan , and he'll just say , hey , look , try this , have you tried this , do this , or whatever . So just yeah , just reach out . Dms are open , slide into DMs . That's how my wife and I got together and we're happy now . So yeah , slide into DMs , slide into DMs . We'll let you Mike .
Speaker 3I would encourage everybody , no matter what state you live in , to go to wwwenergyandsciencecom and click join us and you can see what we're doing , all of our events , our environmental studies we're doing , our discussions on college campuses , everything . Just send me your info and you'll get . I don't send a lot of information . One email a month .
Speaker 2Two emails a month and honestly it's so . It's so few and far between . You'll know about three days out before a meeting's coming up .
Speaker 3Yeah , you're not getting a lot of notice . I'm busy . Nobody emails , nobody emails .
Speaker 2We gotta figure something like that , and I'm actually gonna bring in one last closer for us , if you don't mind . What are you closing us up with today ?
Speaker 1I don't have anything to say and that's all we got for us .
Speaker 2I want everyone to think everyone's for tuning in to Energy Facts Chats and Energy Crew . It's been a blast . I always love sitting across the table from you and obviously our second time within a week doing this . It was awesome , ryan , but anyway , I want to thank everyone out there . If you enjoyed it , please subscribe like a little review . Whether it's Energy Facts Chats let's do or Energy Crew you're listening to it doesn't matter . But , yeah , spread the word and we hope you enjoyed it and we'll talk to everyone soon .
Speaker 3Bye , bye thanks , KB Thank you . Thank you everyone out there listening .
Speaker 1We'll see you next time .