Jason Modglin – Texas Alliance of Energy Producers

Jason Modglin - Texas Alliance of Energy Producers

Kym Bolado and David Blackmon welcome special guest Jason Modglin, President of the Texas Alliance of Energy Producers.

Kym Bolado: David, come on in. And I know you have a couple of questions for Jason as well.

David Blackmon: Yeah. Jason, I just wanted to give you a chance to talk about the flaring issue. I know the industry has had discussions about how to approach the best way to do that here in Texas. Could you give us an update on where those discussions stand here as we get into the second half of the year? 

Jason Modglin: Absolutely. So, the commission as well as associations and energy companies have been working together this summer to improve some of the data collection and transparency at the commission as it relates to flaring. If you recall, at the beginning of July a group of associations made recommendations to the commission to reduce the amount of time that flaring permits would be allowed for a company. That recommendation along with some transparency efforts are going to be rolled into some recommendations that the commissioners will roll out the first week of August. We have seen some flaring reductions as production has declined, but I think over time it’s been relatively stable levels of flaring while production increased dramatically. That’s a result of the infrastructure being built out. It’s also the opportunity for these companies to catch or a little more value by reducing flaring and selling that gas.

Kym Bolado: Okay. Okay. You know, we are going to be getting ready to go to break here. When we come back, we do have some callers on the lines and we’re going to need to take those. 

Caller (Clint): China is becoming a big problem for the United States on trade. How much of an impact is this going to have on the oil and gas sector?

Jason Modglin: It is a huge problem for both intellectual property stealing, but also the opportunity to dump products back into us and in Europe that have been heavily, heavily subsidized by the government, like steel and other types of manufactured products. There’s tremendous growth opportunities in both China and India to utilize oil and gas and whether it’s direct from the U.S., or they’re consuming oil and gas from other countries, and that results in some margin improvements for the U.S. to sell into Europe and South America. Those are opportunities that are potentially coming, but you’re absolutely right about infringement and some of the aggressive tactics.

Kym Bolado: Hey, David, you and I have had a conversation too on China and the upcoming go ahead. Jump into this conversation with us.

David Blackmon: Jason’s absolutely right. They are a huge problem. The other thing China has done is they’ve also gone all over the world and bought up resources, reserved resources for their own kids, including oil and gas and other minerals. And so they’re kind of cornering the market on a lot of very strategic approaches. We don’t think that kind of way about enterprise, so it’s a big problem for our country, for sure.

Click here to listen to other In the Oil Patch episodes.