By Aaron Vandeford
This week, EnerCom consultants attended two in-person events. EnerCom’s CFO and Chairman Blanca Andrus, participated in WBENC Energy Executive Program in Houston. Aaron Vandeford (President) and Dan Genovese (Director) attended Tudor Pickering Holt & Co’s 5th Annual Disruption Conference (D5: Momentum) hosted in Denver.
WBENC Energy Executive Program
The WBENC Energy Executive Program is a blended learning and immersive executive education experience focused on driving the development of Women’s Business Enterprise (WBE) leaders within the Energy Industry. The program’s goal is to help women-owned businesses (EnerCom is a certified minority & women owned business enterprise) grow their knowledge and relationships, increase their competitive advantage, enhance their capabilities, and secure their place as a critical part of the global energy supply chain. With our time at the event, we had the opportunity to learn and interact with other leaders and the program sponsors: Shell, BP, Chevron, and ExxonMobil. This topic is important to us at EnerCom and is a critical part of our own ESG journey. We applaud the sponsors’ commitment to increasing inclusion and diversity in the boardroom, throughout the workforce, and among their suppliers.
Tudor Pickering Holt & Co’s 5th Annual Disruption Conference (D5: Momentum)
Tudor Pickering Holt & Co (TPH) hosted its 5th Annual Disruption Conference [D5: Momentum] in Denver and reported having more than 365 registrants. We can confirm the event was well attended, and we sensed a palpable buzz among the attendees. Discussions touched on a wide range of topics, but focused on the evolution of energy technology, and the importance of emerging (and existing) energy sources. Congratulations to our friends at TPH on hosting a successful event. We very much appreciated the opportunity to be there.
Key Takeaways from Our Travels
Takeaway 1: Industry is focused on the future. Though these were very distinct events, many complementary themes were discussed. All eyes, from the majors on through to the early-stage innovators, are on what the future energy mix will look like. The only certainty at this stage is that it will look more diverse than it is today. The other given is that traditional oil and gas players will continue to be relevant, and may yet be the conductors of the energy evolution train.
Takeaway 2: Woman in energy is the future of our industry. The energy mix will not be the only element that will be more diverse going forward. In an industry that has been dominated by white males, there are real inroads being made by minorities and women. BP, as part of its equity program, has committed to doubling its Diversity spending by 2023. Shell has a similar initiative. Its Powering Lives program is focused on increasing supplier diversity and inclusion programs. Chevron and ExxonMobil are also placing a great emphasis on diversity and inclusion within their corporate structure. Even this morning, EQT Corporation (NYSE: EQT), the largest natural gas producer in the United States, was honored by the Women’s Forum of New York at its Breakfast of Corporate Champions for achieving 50% female representation on its board of directors (read full story here).
Today’s energy markets and evolution require new ideas and differentiated thinking that can only come from a differentiated workforce. (Extra credit: check out the Woman in Energy panel from EnerCom Denver this past August)
Takeaway 3: Nuclear energy has a seat at the table in our energy evolution. Hydrogen seems to be the flavor of the month when talking about alternative sources of energy. That said, there is still a heathy skepticism in the market. As overheard at the “water cooler” one evening, “Hydrogen is the energy of the future, and it always will be.” Could this time be different? There are some great companies and minds working to pave an economic path to a hydrogen future (EnerCom will host multiple hydrogen presentations at The Energy Investment Summit, on February 16-17). Only time will tell but it was refreshing to hear a steady drum beat at both events around an existing low-carbon intensity and economic energy source, nuclear.
Nuclear technology has quietly advanced in safety, cost, scalability, and longevity over the past 20-30 years. This power source receives little/no attention and news coverage in the energy transition conversation, and is a blatantly ignored, carbon free solution for reliable energy. EnerCom did overhear a serious discussion about using Jeff Bezos’ Blue Origins rockets to dispose of nuclear waste into space. (Extra credit: check out TPH’s C.O.B. Tuesday discussion with the Nuclear Energy Institute)
Takeaway 4: Big price tag to meet stated goals of carbon neutrality by [pick your date]! We heard some estimates of investments exceeding $50 trillion to achieve our carbon neutrality promises. Carbon offset markets are evolving, but will need to build trust with users and will not be sufficient to get us there. Beyond the contracted offset market, larger operators are investing in other carbon negative production sources like Renewable Natural Gas (RNG) to internally move the needle on carbon intensity. Though the management teams that are making the carbon neutral promises today will not be in place when their dates come due, the companies will still be held accountable, and investment needs to start yesterday. (Extra credit: check out the RNG panel from EnerCom Denver this past August)
Takeaway 5: Climate risk is financial risk. This is a growing mantra of many in the investment community (and all of the consulting world that seeks to “help” industry manage this risk). It feels like you still cannot talk to anyone without ESG coming up in at least the first few sentences. With climate specifically, many are tackling this risk through carbon intensity lenses, but we are starting to see that the discussion will quickly move beyond that. It will be a holistic environmental impact discussion that will require good data (monitoring will be a start) to build trust among stakeholders and companies.
We fully recognize that our position as ESG consultants may cloud the way that we talk about this topic. With that admission recognized, we pride ourselves on being a voice of reason over profit. Our policy on ESG continues to be that small, growing companies do not have the same reporting requirements as larger peers, and should be comfortable disclosing metrics most commonly reported by their peers. ESG is a journey. Companies need to start moving down the path. They can walk before they run. And EnerCom can help. (Extra credit: check out BlackRock’s ESG presentation from EnerCom Denver this past August)
Aaron Vandeford is the President of EnerCom, Inc. Over the past decade with EnerCom, Aaron has played key roles in the development, expansion and evolution of EnerCom’s proprietary operational and financial databases as well as the company’s predictive valuation models. He has worked with E&P, Oilfield Service and private equity clients large and small, public and private, to better understand valuation and refine marketing messages.
EnerCom, Inc. is the energy industry’s leading communication experts. We can help you with corporate strategy, ESG, media and government and stakeholder relations to effectively communicate your company’s story. Contact: [email protected]