This week’s Pipeliners Podcast episode features Mark LaCour of the Oil & Gas Global Network returning to the podcast to discuss pipeline industry predictions for 2023.

In this episode, you will learn about the predictions that Mark puts together each year for the pipeline industry that are based on market research, as well as pipeline predictions from our host, Russel. They discuss their predictions from the previous year and the multitude of ways that the industry is changing.

Prediction Summary:

Mark’s Pipeline Predictions:

• CO2 will be a new revenue stream.
• The current administration here in the US is going to continue to hamper pipeline permitting and growth.
• Pipeline constructions in BRICS.
• An increased need for physical security on infrastructure.
• Enormous need for new pipeline infrastructure for LNG export in North America.
• Huge need for pipeline infrastructure for LNG offloading and regasification in Europe.
• Second tier of projects to retrofit pipelines to make sure that we can reliably measure and mitigate any type of methane emissions.

Russel’s Pipeline Predictions:

• Increasing cyber and physical security attention.
• LNG and related pipeline projects.
• More projects, but less of them in the new cycle.
• CO2 projects getting done.
• ESG and hydrogen continue, but they are going to slow down.

Pipeline Predictions 2023 Show Notes, Links, and Insider Terms

• Mark LaCour is the Director of modalpoint, editor-in-chief of the Oil & Gas Global Network (OGGN), and co-host of the Oil & Gas This Week podcast. Connect with Mark on LinkedIn.
  • modalpoint is the premier oil & gas sales enablement company. The main practice areas are market research and strategy, all solely focused on the global oil and gas industry, and all built upon what truly works and not classroom theory.
• Super cycle is a sustained period of expansion, usually driven by robust growth in demand for products and services.
• Upstream is the operation stage in the oil and gas industry that involves exploration and production. 
• Midstream is the processing, storing, transporting and marketing of oil, natural gas, and natural gas liquids.
• Downstream is the process involved in converting oil and gas into the finished product, including refining crude oil into gasoline, natural gas liquids, diesel, and a variety of other energy sources. The closer an oil and gas company is to the process of providing consumers with petroleum products, the further downstream the company is said to be.
• Hydrocarbon is an organic compound consisting of hydrogen and carbon found in crude oil, natural gas, and coal. Hydrocarbons are highly combustible and the main energy source of the world.
• EOR (Enhanced oil recovery) also called tertiary recovery, is the extraction of crude oil from an oil field that cannot be extracted otherwise. EOR can extract 30% to 60% or more of a reservoir’s oil, compared to 20% to 40% using primary and secondary recovery.
• FERC (Federal Energy Regulatory Commission) regulates, monitors, and investigates electricity, natural gas, hydropower, oil matters, natural gas pipelines, LNG terminals, hydroelectric dams, electric transmission, energy markets, and pricing.
• Liquefied Natural Gas (LNG) is natural gas that has been cooled to a liquid state (liquefied), at about -260° Fahrenheit, for shipping and storage. The volume of natural gas in its liquid state is about 600 times smaller than its volume in its gaseous state in a natural gas pipeline.
• IRA (Inflation Reduction Act) of 2022 is a landmark United States federal law which aims to curb inflation by reducing the deficit, lowering prescription drug prices, and investing into domestic energy production while promoting clean energy.
• AGA (American Gas Association) represents companies delivering natural gas safely, reliably, and in an environmentally responsible way to help improve the quality of life for their customers every day. AGA’s mission is to provide clear value to its membership and serve as the indispensable, leading voice and facilitator on its behalf in promoting the safe, reliable, and efficient delivery of natural gas to homes and businesses across the nation.
• British Thermal Unit (BTU) is the amount of energy needed to raise 1 pound of water by 1 degree Fahrenheit while at sea level.
• ESG (Environmental, Social, and Governance) refers to the sustainability movement in oil and gas to continue operating safely, in compliance, and in a responsible manner to do no harm while achieving business objectives.
• SCADA (Supervisory Control and Data Acquisition) is a system of software and technology that allows pipeliners to control processes locally or at remote locations.

Pipeline Predictions 2023 Full Episode Transcript

Russel Treat:  Welcome to The Pipeliners Podcast, episode 267, sponsored by Gas Certification Institute, providing standard operating procedures, training, and software tools for custody transfer measurement and field operations professionals. Find out more about GCI at GasCertification.com.

Announcer:  The Pipeliners Podcast, where professionals, Bubba geeks, and industry insiders share their knowledge and experience about technology, projects, and pipeline operations.

And now, your host, Russel Treat.

Russel:  Thanks for listening to the Pipeliners Podcast. I appreciate you taking the time. To show our appreciation, we give away a customized YETI Tumbler to one listener every episode. This week, our winner is James Gates with Black Hills Energy. Congratulations, James, your YETI is on its way. To learn how you can win this signature prize, stick around till the end of the episode.

This week, we are speaking to Mark Lacour with Oil and Gas Global Network about his pipeline predictions for 2023. Mark Lacour, welcome back to the Pipeliners Podcast.

Mark Lacour:  It’s a pleasure to be back. It’s been a little bit too long. We’ve all been super busy.

Russel:  No doubt. Me too. I brought you back, Mark, because last year we did a pipeline predictions for 2022. You were so highly accurate that I feel like you need to come back and do it again. 

Mark:  You’re going to put me on the spot. Let’s see if I can even get it close compared to last year.

Russel:  You and I both did predictions. We’re going to run through that here in a second. I’ve got to tell you that as I was preparing for this, I really got a little nervous because I saw how good I did last year.

Last year, I was just like, “Well, I’ll say this because Mark made some predictions. So I’ll make some too.” Now that I’m looking back, I’m like, “Oh, man. Now the pressure is on.” I don’t want to be the only one feeling pressure. I want to have partnership in this.

Mark:  The whole funny thing about that is I’ve been doing this, not around pipelines, but around the oil and gas industry as a whole for about nine years. Starting in October of every year, because my predictions come out in November for the following year, all the analysts start reaching out to me.

Like, “Where are your predictions?” It’s like, “You’re the analyst. You’re the one that gets paid for this. Why are you waiting for my predictions to come out?”

Russel:  Maybe sometimes just doing it based on your gut is more effective than having a whole bunch of data clogging your mind.

Mark:  I tell you what. Sincerely, the quality of your future predictions go down the more data you bring in. You need some, but more makes it worse, not better.

Russel:  That comes straight out of economics, absolutely. Let’s start by just reviewing. By the way, I want to give you a shoutout. Mark’s already mentioned it. We’ll link this up in our show notes.

If you want to hear his overall oil and gas predictions, you can go listen to Oil and Gas This Week. We’ll link that episode so you can hear what his predictions are for 2023. I thought that was pretty interesting.

Mark:  Thank you.

Russel:  What we’re going to do first is talk about how we did for 2022. I’m going to go first. I had five predictions. The first one was fewer large projects and more smaller niche projects. I certainly think that was true.

Mark:  You nailed that one.

Russel:  I think that was born out. An increase in cybersecurity requirements.

Mark:  You nailed that one.

Russel:  That was not only prophetic. It was painful. We’re starting to see all kinds of additional terms and conditions in all our agreements, particularly on the software side of our business. We’re just seeing a lot more of that stuff. That’s one I got right. Increased focus on physical security for remote unmanned sites. I think I got that right.

Mark:  You were psychic on that one. Think about the physical incidents that happened last year, in 2022, with pipelines.

Russel:  Exactly. And some of the stuff that more recently happened related to the electrical grid. That threat seems to be growing. Then I said increased prices. Say I nailed that. Lastly, I said more opportunities for startup pipelines. I would say that’s true. I don’t know that they’ve actually begun to happen yet. I’m just going to say I did 100 percent because I can. 

Mark:  It’s your show. As an independent third party, I will also say that you got 100 percent.

Russel:  Man, the pressure is on for 2023.

Why don’t you run down what you had for 2022 and tell me how you think you did?

Mark:  All right. My first one was an increase in community pushback. I think I nailed that one. My next one was consolidation in sharing of transport. I think I nailed that one. Just like you, I saw cybersecurity would continue to be hot.

Increase in executable demonstrations of technology. That’s a long-worded way to say if you have a new tech, I need to see that it’s real rubber, hit the road, not academia. We definitely saw that. Increase in the cost of labor, yeah. Struggle for the retention of social standings for pipelines. Unfortunately, I got that one right.

Then I said 2022 would be the beginning of a 10-year super cycle for the pipeline industry, especially in North America. I still hold that’s true. I think I did pretty good as well.

Russel:  I think you did 100 percent as well, Mark. Talk to me a little bit about 2022. Do you think it was a confirmation that we have a super cycle starting? Then maybe talk a little bit about what you think a super cycle is.

Mark:  It’s easy to say this now, but you’ve got to remember I saw this coming in 2021. You go back and look at my predictions. I said the world’s entering an energy shortage, and we have. A lot of people today in 2023 will point at Russia and Ukraine. Our world’s energy shortage started way before that.

The Russia-Ukraine thing just sped it up a little bit. Unfortunately, not only has the world been in an energy shortage for over a year, I think it continues the next couple of years. When I say super cycle, what I mean is the entire oil and gas industry, everything from upstream to midstream to downstream, there’s going to be a big demand for it for a decade, if not even longer.

When I said the beginning of a super cycle, that’s what I meant. The world’s going to need more hydrocarbons to come out of the ground, so that’s more upstream activity. The world’s going to need to move those hydrocarbons, so that’s more midstream or pipeline activity. The world’s going to have to turn those hydrocarbons into usable products. That’s more downstream activity.

Unfortunately, I got that right. You look at what’s going on, this is the first week of January 2023. The world is still in an energy shortage. We’re going where we’re starting to burn coal, and people are burning peat and wood again just to stay warm, which is ridiculous.

We have a huge global constraint on refining capacity. If anybody out there’s bought diesel in the last year, you know what I’m talking about. Those constraints aren’t going to go away any time soon. Unfortunately, Russel, a lot of it’s caused by political decisions, not from the lack of hydrocarbons or the lack of technique or process.

We’ve made some bad decisions in this world, not just here in the US, but all around the world. That’s what’s caused this energy shortage which, unfortunately, I saw coming. Like I said, it’s not going away for at least another 18 months if not two years.

Russel:  I agree with you 100 percent, Marc. One of my perspectives on this is that we can pretty quickly screw up the energy cycle, but we can’t fix it quickly. Once you get that whole supply chain messed up in any one piece, it takes a long time for it to come back and optimize.

When I say a long time, I’m talking 24 to 36 months, and I think that’s right where we are. The problem is we didn’t just mess a piece of the chain up. We messed all of it up. We’ve got a long way to come back.

Mark:  Russel, you and I will be fine. We may gripe and complain about paying a little bit more to fill our cars up. The real impact is to be our world’s poorer people. Right now, literally today, there are people in Europe that can’t afford to heat their homes, and next winter’s going to be worse.

It’s horrible that we’ve allowed this to happen. To your point, we can fix it, and we’re in the process of fixing it, but it’s not going to happen overnight. It takes a long time to build a refinery. It takes a long time to build a pipeline. It’s not stuff you can snap your fingers, and it’s instantly there.

Russel: Some of these pipeline projects that have been built recently have been constructed quite quickly, but they have been years and years and years in the design and development process so that once they finally got all their permits, they could dig, weld, and go.

Mark:  I tell you this much, and I’m not picking on any other country, but when you look at the US pipeline industry and you look at its ability to greenfield new projects, we’ve gotten really good at it. Not only have we gotten really good at it, we’ve gotten really good at making sure we don’t impact the environment.

You go look at a new pipeline install a year after it’s been put in, you won’t see it. You won’t even know where it is. We’ve done that good at making sure that we don’t impact the environment. We’ve gotten really good at it, which is cool.

Russel:  Yeah, absolutely. Look, why don’t we just dive in? I want to hear your pipeline predictions for 2023. After such a stellar performance for 2022, I’m very excited to see what you think we have in store.

Mark:  My first one is CO2 will be a new revenue stream, the movement of CO2 in pipelines. That’s based on a bunch of stuff. Regardless of what your opinion is about CO2 and climate change, it has now become a commodity that’s funded by two different buckets.

You’re seeing ExxonMobil and Oxy both build direct air capture CO2 facilities. That’s predominantly being funded by taxpayer dollars. You’re seeing the same thing happen around the world.

If the taxpayer dollars go to build these types of direct air carbon dioxide capture, the next thing you do is move it. As everybody knows, all your audience knows, the safest way to move anything in the world is in a pipeline. You’re seeing pipelines being built to move CO2 from where they capture it to wherever they want to use it or sequester it in a reservoir.

Once again, back to ExxonMobil, last year, they bought several blocks in the Gulf of Mexico with no intention of trying to get hydrocarbons out of the ground. They’re going to use that to store CO2. You may go, “Why would you do that?” What your audience may not know is, for a very long time, carbon dioxide is used as a well stimulation technique.

You take an old reservoir, which doesn’t produce at the right financial level, inject CO2 in that reservoir, and it basically makes the oil less sticky so your lift cost is less. Now, by using CO2 for enhanced oil recovery, you can make the reservoir profitable again. That’s been going on for 20 years.

Russel:  It’s been going on more like 50, Mark. I’m actually quite knowledgeable about that market, and I’ve been to most of the EOR fields that do CO2.

Mark:  Then there’s this other bucket of finance for CO2 in that it’s a commercial product. Brewers use it, bakeries use it, farmers use it, greenhouses use it. It’s used in a lot of commercial chemical applications, and that money is coming from the normal market drivers.

You put all that together, and CO2’s going to be a new revenue stream for the pipeline industry. I didn’t know this had been going on for 50 years. That’s pretty incredible.

Russel:  They did the first CO2 injection in the Permian in the ’70s.

Mark:  I was eight in the ’70s – eight/nine years old – so I wasn’t quite there yet. Anyway, that’s number one.

Russel:  Let me talk about that from my perspective a little bit. I agree with you, but I have probably a little bit different color on my perspective. My first job out of the military, I worked for a company called Airco Industrial Gases, and I was a CO2 applications engineer. I implemented CO2 in various kinds of applications, including pH control, food freezing, and a number of others. I’m fairly knowledgeable.

Likewise, our company built and then sold a CO2 measurement product. We took a deep look at the CO2 EOR and the CO2 carbon sequester, capture, and all that. Two big players in that are Denbury and Kinder Morgan currently. They have major pipeline infrastructures for CO2 already. Of course, most of that’s driven by EOR.

I have a high degree of skepticism simply because I don’t know what it’s going to take to get these projects permitted and made commercially viable. I agree that CO2’s going to drive some business in the next five years. I don’t know that it’s ever going to get to an adequate scale to be long-term sustainable.

Mark:  Let’s revisit this in five years.

Russel:  I don’t know if I’ll remember this five years from now.

Well, it’ll be in the show notes. We’ll review it going forward. My prediction around CO2 is, yeah, we’re going to be doing more projects. We’re going to get some projects done that have been trying to get done for a while.

Mark:  My next one, unfortunately, is our current administration here in the US is going to continue to hamper pipeline permitting and growth. You look at a lot of stuff that FERC’s doing, and it’s obvious that our current administration says to the public that we need more hydrocarbons to come to market to help with this energy shortage.

From what they’re actually doing, they’re not helping with the permitting and growth metrics here in the US.

Russel:  Interesting. I concur with that, absolutely. My prediction related to this is that we’re going to see more projects occurring, but less of them in the new cycle.

Mark:  That’s one of the things that’s going on. It’s also something that’s going on in the downstream part of the industry. There’s stuff going on, and our current administration hasn’t noticed it yet, which is unfortunately what we need to have happen so we can get these projects up and online.

Russel:  I don’t know if the current administration hasn’t noticed it or if it’s, “If I don’t see it, I don’t have to talk about it.” There’s a certain level of these projects we need to get done, and the administration, or at least people in the administration, knows at a certain level that stuff has to happen. I think we’re going to see some things getting done, but…

Mark:  I hope you’re right. I hope I’m wrong.

Russel:  …less of it in the new cycle.

Mark:  Yeah. My next one, and this is not talking about the US, it’s talking about the world. You can see huge pipeline growth potential for greenfield installs in BRICS, which is Brazil, Russia, India, China, and South Africa. Now that it looks like Saudi Arabia’s going to be accepted into that organization, all of a sudden, you’ve got Saudi Arabia’s capital.

Once again, you need to move these hydrocarbons from where they’re produced to markets, and I think you’re going to see tons and tons of pipeline construction going on in those parts of the world.

Russel:  It’s interesting. I agree with that as well, again, a little bit different perspective. I think what we’re going to see is pipeline projects related to LNG activity.

Mark:  I’m getting to that. You’re ahead of me.

Russel:  Oh, well go ahead.

Mark:  Here’s one that you had last year that I didn’t, but it’s one that I have this year. An increased need for physical security on this infrastructure. The people and organizations out there that don’t like our industry have moved from protests to criminal activities, to the point that some of those criminal activities can get people hurt and even killed.

The only way that we can stop that from happening and protect the environment is we’re going to need more physical security in our infrastructure.

Russel:  I’ve done a couple of podcasts on that subject recently with some people that are doing training and consulting in that domain. It’s interesting. It’s another form of risk mitigation that we need to do in our business.

Mark:  Russel, if you would have told me five years ago that activists would be gluing themselves to Van Gogh paintings, I would have said you’re crazy. Even they don’t think that they’re crazy, but they are. We can’t let somebody that is trying to protest what we do cause an incident somewhere.

We have to heighten our…Not have to. It’s happening right now. I see it. We have a bigger need for physical security.

Russel:  Yeah. There’s a lot going on in that domain, and a lot of that doesn’t get a lot of press for good reason.

Mark:  For reason, yeah. My next one, there’s going to be an enormous need for new pipeline infrastructure for LNG export in North America. The world needs our LNG. We have it. With what’s going on in Russia and Ukraine, last time I looked, which I think was yesterday, about 10 percent of all the LNG that’s being moved in the world’s ocean is going toward Europe.

Of that 10 percent, about half of it’s coming from the US. Our constraint here is more pipeline infrastructure to move that natural gas to the LNG facilities and then more pipeline infrastructure to move the LNG for export.

Russel:  Yeah. I couldn’t agree with you more. That was my number two on my list, so I’m right there with you.

Mark:  My next one is the opposite of that. There’s going to be a huge need for pipeline infrastructure for LNG offloading and regasification in Europe. I am proud of the nations that have voluntarily quit buying Russian hydrocarbons. I never thought that would happen ever, no matter what happened.

I am also proud of Europe for the most part, putting up with what it has with it being very cold, very expensive energy prices this winter, to not buy Russian hydrocarbons. In order to backfill that, unfortunately, they’re building coal-fired power plants. Once the coal-fired power plants are up and running, that’s an increase in air emissions.

The only way to bring that back down is to switch from coal to LNG. We have LNG. We have the ability to export it, although our export industry still isn’t built out completely, still not mature. There’s a lot of work there.

In Europe, they have to build the opposite infrastructure to offload that LNG and also the pipeline infrastructure to regasify that LNG and put it into your gas system. You’re going to see a lot of infrastructure being built in Europe, on the other side, for LNG offloading and regasification.

Russel:  It’s going to be a good year for gas pipeliners.

Mark:  Let me tell you. This year, there’s going to be a higher demand for pipelines, both onshore and offshore, not just onshore but offshore. We’re going to have to deal with constraints in labor and permitting, but overall, it’s going to be a great year for the pipeline industry.

My last one is, because of the Inflation Reduction Act, which…I hate that name, that IRA. I’m old enough to remember the Irish Republican Army. That’s what I think of when I hear IRA.

Anyway, because of the IRA bill and new methane regulations, there’s going to be a lot of projects in the US for retrofitting existing pipelines with all the stuff you need to track and measure emissions, so sensors, valves, activators, all that sort of stuff, so a second tier of projects to retrofit pipelines to make sure that we can reliably measure and mitigate any type of methane emissions.

Russel:  Interesting. There’s a lot of correlation between what you’re talking about and what I’m talking about. I’ll just go through mine quickly. Some of this we’ve already talked about. My number one was increasing cyber and physical security attention. The second one was LNG and related pipeline projects. We talked about both of those.

The next was more projects, but less of them in the new cycle. Then I said CO2 projects getting done. My next to last one, which we haven’t talked about, is ESG and hydrogen continue, but we’re going to slow the roll.

Mark:  Yes. I’m super bullish on hydrogen. I have been for a decade and for a whole bunch of reasons. The problem is, we can produce hydrogen and forget the whole green, blue, red, whatever. It’s hydrogen, right?

We can produce hydrogen. In the right concentrations, we can move it in the pipelines without damaging the steel. In different concentrations, we have to have different pipeline materials so we can move without damaging the steel.

I don’t think the demand will be there yet for large pipeline projects for hydrogen until things like consumer fuel stations are built for hydrogen vehicles. It’s not the hydrogen vehicle that’s the constraint. It’s the ability for people to refuel their vehicles with something that’s harder to handle than gasoline or diesel.

If I would take that hydrogen prediction, I think you’re right. I think you’re just very early to the game. That’s two or three years out.

Russel:  Yeah. Where I’m seeing most of the activity in hydrogen is primarily around the gas utilities, where they’re talking about blending hydrogen in. They’re trying to determine how much hydrogen can we blend in without impacting the steels we already have in the ground.

There’s been some research done on that. There was a good paper presented at AGA last year. There’s a lot of people starting to look at it, but once you actually start pulling the covers back, you’re taking a chemical that has one third of the BTU capacity as methane and I’m going to inject it.

Now I have to flow more to deliver the same amount of BTU. That means I’ve got to burn more to deliver the same amount of BTU. That means that I…Then I’ve got all these other issues related to moving hydrogen in a legacy network.

There was a lot of energy last year about “We got to do this, we got to move forward because it was an initiative being pushed.” Now we’re getting to, “OK, sure, but now we got to do the real engineering and figure all this stuff out.” It’s just going to slow things down because there’s a lot of stuff we don’t know yet.

You got the same kind of thing going on with ESG, in that people are starting to say, “Look, what’s the real business case around this? Where’s the real kind of…?” Our business is full of engineers and people that want to know how things work.

It’s not like we don’t care. We do. My experience is that we’re adamant about protecting the environment, doing no harm, and all those things, but we’re constrained by the fact that we know how things work. 

I think you’re going to see those things continue, but I think you’re going to see them slow down and become more deliberate and thoughtful.

Mark:  The whole ESG is really interesting. When it came onboard, the entire oil and gas industry looked at it and said this is interesting, but I’m not going to do anything until I figure out what’s going on. A lot of companies jumped in kind of early, predominantly because of investor pressure, investor relations, public relations, that sort of stuff.

They hired an ESG officer, gave him a small budget, but they didn’t really do a lot. To your point, especially here and in Europe, we have always been stewards of the environment. Health, safety, and environment is the major driver in this industry.

I put us against any industry here in the US and Europe as far as our care and self-reporting how we impact the environment. The part of the ESG that I think the industry really needed was that governance part – not the environment, not the social, but the governance.

Personally, if I’m watching a guy that runs an independent E&P company with a bunch of investor monies, and the entire company goes bankrupt, they have to lay everybody off, and he walks away with a $10 million severance package, that’s wrong.

We’ve needed to fix that. I think that’s happened. It’s really interesting to watch what’s happening in the investor world. 2021, 2022, a lot of investors were not putting money in oil and gas companies because of their fear of ESG.

What happened in 2022? They lost out on tremendous returns, sometimes 100 percent. What happened? The entire mass of the ESG investors at the end of 2022 said, “I don’t care about ESG. I need to make money. That’s what I’m hired to do.” Now, there’s a bunch of capital coming back into oil and gas, and they’re not even asking about ESG.

Whether that’s good or not, let’s wait and see, but to your point, the entire industry paused for a second, held its breath. The investors applied pressure to the oil and gas industry where they could. Then, when they realized how much money they missed out, they threw it out the window.

Russel:  Yeah, that’s right. That’s right. I don’t want to get too much into…I don’t like talking about politics on this show. I know you try to avoid it. You can’t be in our business and not talk about politics in terms of the impacts. I try not to advocate or complain. 

Mark:  You know what we did to fix that?

Russel:  I’ve done one podcast on that, so you can listen to it

Mark:  On geopolitics.

Russel:  I’ve done one podcast, but there’s plenty out here. Actually, that’s the next question I wanted to ask you. We’ve got a little bit more time. Can you tell us what’s going on with the Oil and Gas Global Network? What do you guys have going on? What’s new? What are you excited about in the upcoming year?

Mark:  It’s really interesting. We’ve grown tremendously. In 2020, we grew 107 percent, which was the exact opposite of what I thought was going to happen. The last two years, we’ve grown 30, 35 percent year over year. We’re at 15 separate shows as of today. We have three more we’re launching this month, in January, with seven more on the books for 2023.

A bunch of interesting things happened. We talked a little bit and we’re launching a geopolitical show. I thought I would never find a sponsor for that. No matter what your beliefs are politically, a geopolitical podcast is going to be one side versus another. No company, especially if they have shareholders, wants to be on one side versus another.

I found a company that didn’t care. I still can’t believe I did this. That’s going to be really interesting. We’re launching an oil and gas sales and marketing podcast because sales and marketing in oil and gas is 10 years behind every other vertical out there. We’re going to try to fix that delta.

The most interesting thing to me is we had a sponsor reach out – we haven’t closed the deal yet, so I don’t want to mention their name, but we’re pretty close – that wants to work with us not because of our oil and gas niche but because of our numbers.

This potential sponsor has nothing to do with the oil and gas industry. They don’t care about the oil and gas industry, but they see the reach that we have, and they want to sponsor. That’s a totally different business model for us.

It was weird because we’ve never had this activity before, never. Then we’ve had three companies reach out for the exact same reason in the last quarter of that year. We hit some type of threshold. That’s a good thing, but now we need to figure out how to capitalize on that. Because it’s new, we haven’t figured it out yet.

Russel:  That’s fascinating.

Mark:  It really is.

Russel:  That’s absolutely fascinating. It actually gives me some hope too for what we can do in the oil and gas business. You start getting sponsors that have no connection to oil and gas but they want to be able to talk to your audience. That gives us an opportunity to build relationships outside of our core community.

Mark:  Yeah, and the cool thing about that is one of the things about our industry, and we need to raise our hand as an industry and own this, is that anytime somebody says anything wrong about our industry, whether it’s an accident or on purpose, we’ve never stopped and corrected them. We’ve never educated the world on what we did.

Part of that was a long time ago, this industry was looked upon as the holy grail. Everybody wanted a job at Chevron. Once you got a job at Chevron, you were set for life. Over the years, we’ve had people that don’t like our industry talk about us. Then, with the advent of social media 15 years ago, one person can have the ear of millions.

Now, there’s tons and tons of misinformation. As an industry, we haven’t educated the world in what we do. That’s why a lot of our world’s young people think we’re destroying the planet. You and I know that we’re not. In fact, we’re making it better.

With these companies wanting to reach out to us and work with us that have nothing to do with the oil and gas industry, it gives us a chance to educate them. To your point, not politics, not opinions, education.

This company that we’re talking to literally was in shock when I told him that 60 percent of the world was fed with fertilizer made from natural gas. They went and fact checked me, and their CEO shot me an email.

By the way, they’re headquartered in California, speaking of places where politics maybe don’t line up with the oil and gas industry. He goes, “Mark, nobody in my entire company knew this. I want to learn more.” Because of this interaction, even if we don’t close a deal, we may have a chance to educate a company about how the industry actually works, which can make it better for everybody, including them.

Russel:  Just having people know what impact we have and how much they rely on what we do.

Mark:  Yeah.

Russel:  We’ve gotten so good at doing it and doing it without being noticed, that’s, in the long term, worked against us.

Mark:  100 percent it’s worked against us.

Russel:  We go back into the ’70s, everybody knew we were there. Any time there was a refinery or something, there was a smokestack, and you could drive around town and you saw the smoke scrolling up into the sky. We’ve gotten so good at minimizing our footprint and cleaning up our impact that people have forgotten how important we are to what they’re doing.

Mark:  We’ve gotten so deep into things like chemistry and all the products make modern lifestyle possible that it’s been disconnected for a very long time. People have no clue. I think about this all the time. I know where electricity comes from. I have a 17-year-old son who I’ve asked. He’s a smart kid. He really doesn’t understand.

I’m thinking my grandfather had to understand electricity enough because he built his own home and he wired his own home. The only reason I understand electricity is my dad did commercial refrigeration and air conditioning. I helped him, so I had to learn how to use a meter, read amps, volts, all that sort of stuff.

My son has no understanding. That’s the same thing happening to the oil and gas industry. At some point, you had people with cans of oil lubricating farm equipment, and they knew the importance of that can of oil. Now, to your point, we’ve gotten so clean and we’re so behind the scenes that nobody knows what we do. We need to change that, Russel. We need to educate our world.

Russel:  It’s problematic. Being a guy who’s worked in computers and software all my career, even when I was doing other things as an engineer, when I started out with computers, which was in the late ’70s, you could learn everything there was to know about a computer. That’s impossible now. It’s too large and too complex a domain.

What’s happened is we have all these people. They become more and more specialized in a narrower and narrower niche, and they don’t have general knowledge. That’s problematic.

Mark:  It’s a good analogy because you probably know how to change a NIC card. You probably know how to go in and change a power supply. Now, because computers have become so cheap, you don’t need to understand anymore. In fact, you probably can’t change the part if you wanted to.

So much of these manufacturers are using adhesives so, of course, now you don’t know how a computer works.

Russel:  When I was in college, you got a computer degree, you did everything. I built my first computer in 1981. I got a TRS 80, and I built it on my kitchen table. I was soldering chips onto boards, putting boards into the chassis, powering the thing up, and then making sure I got the little prompt. Then writing code so that I could get it to do something. You did all of it.

Mark:  You remind me of something real…

Russel:  Nobody does that anymore.

Mark:  You remind me of something really funny. I was cleaning out my closet. I had some one and a half megabytes disks in there, and my son saw them. He goes, “Dad, you 3D printed the save icon.” I’m like…

Russel:  [laughs]

Mark:  See, you get it, right? I had to think about it for a second. It’s like, “No, I didn’t.” He’s a very smart kid, but to your point, that’s his point of reference.

Russel:  We’re getting off in the weeds here, but it’s an interesting conversation. you can ask, “What does this reality have for the future?” I think that one of the things we’re going to have to do, and I always find it interesting…I do a fundamentals of SCADA class. That class, probably 20 percent, is history. Where does the technology come from?

It’s so critical to understanding technology now. Do you know why we measure oil in a barrel, a 42-gallon barrel?

Mark:  Yeah, because JD Rockefeller determined that was the optimum size to move by manpower on rail, and they painted them blue so that you could know that it was Standard Oil’s barrels of oil.

Russel:  It was also the same size as a beer keg.

Mark:  Didn’t know that part.

Russel:  They repurposed beer kegs transporting oil. It was the size that one person could handle.

Mark:  One person could, yeah, that’s the story I always heard. Going down that route, let me tell you where I think hydrocarbons are going to come back into public knowledge. It’s not where most people would think – space travel.

Very interesting stuff. The hydrocarbons we have here on Earth are organic. I could go through a whole process of how they’re made. Hydrocarbons are also extremely energy dense. The only fuel right now that you could get us out of our gravity well is hydrocarbons. SpaceX and NASA both use kerosene liquid oxygen, even though they call it kerosene rocket fuel, RO-1, I believe. [RP-1]

Elon Musk’s SpaceX has built a new generation of rocket engines that run off liquid methane, which, to your point earlier, needs a little bit more fuel for the same power. Why would you build a new generation of rocket engines that burns more fuel? That makes no sense.

If you look at our solar system, regardless if you believe in a god or not, at the halfway point, there’s this planet called Saturn. Around Saturn is a moon called Titan. Titan is covered with lakes of liquid natural gas, methane.

Elon Musk’s team has already done the feed study of dropping pumps in low-Earth orbit satellites or low-Titan orbit satellites to pump that liquid methane up to refuel spacecraft. It’s a refuel spot in our solar system. And, hydrocarbons are not rare. There’s inorganic hydrocarbons all over our universe that chemical engineers can use to make everything.

Space travel, not only is impossible without hydrocarbons, it’s going to make it commercially viable. When that happens, which is a hundred years away, all of a sudden, our world’s young people are to understand organic chemistry again, understand hydrocarbons, the value of them. It’s going to bring it all back.

I fully suspect in a hundred years, you’re going to be watching whatever television-like device you have, and you’re going to see Schlumberger and Halliburton vehicles mining asteroids for hydrocarbons. I think that’s when it’s going to come back to being common knowledge of how all that stuff works.

Russel:  Dude, we should make a movie.

 That is such a great idea. Make a movie like a documentary made in 2250.

Mark:  The interesting thing about the hydrocarbons on Titan is they’re organic. We don’t know why they’re organic, but they’re organic. Which is another whole story for us to figure out in the future.

Russel:  Yeah. Listen, Mark, I got to tell you man, I could go and do this forever with you. This is so much fun. You and I can tell are nerds cut from the same cloth.

Mark:  Yeah.

Russel:  Anyways, this has been great. It’s been way too long since we’ve had you on. Best wishes for a profitable and productive new year with the Oil and Gas Global Network. I look forward to talking to you again next January and see how we’re doing.

Mark:  Yeah, that will be fun. Let’s hope and pray that at least 2023 is more of a normal year than our last couple of years.

Russel:  Yeah, absolutely. All right, my friend.

Mark:  Take care. Thank you.

Russel:  I hope you enjoyed this week’s episode of the Pipeliners Podcast and our conversation with Mark. Just a reminder, before you go, you should register to win our customized Pipeliners Podcast, YETI Tumbler. Simply visit PipelinePodcastNetwork.com/Win and in yourself in the drawing.

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If you have ideas, questions, or topics you’d be interested in, please let me know either on the Contact Us page at PipelinePodcastNetwork.com, or reach out to me on LinkedIn. Thanks for listening. I’ll talk to you next week.

Transcription by CastingWords