American Oil and Gas Reporter - November 2015 - 124

ConventionCoverage: New Mexico Oil & Gas Association

Jeff Skiles, co-pilot of U.S. Airways Flight
1549 from New York, recounts the emergency landing on the Hudson River in
January 2009. Skiles credited the survival
of the crew and all 150 passengers to
the crew's standardized safety training,
which he said had improved in the past
two decades.

gency procedures, Skiles recounted, and
they executed their training well, instructing passengers how to brace for impact.
The plane landed on the Hudson River
and all 150 passengers and the entire
flight crew survived, he related. Ultimately,
he suggested, the flight crew was successful because it had followed its training
and worked as a team.
"You don't have time for a lot of indepth, critical thinking in a situation like
that," Skiles reflected. "It is all reaction
and what you bring to the table: training,
procedures and teamwork."
He said the aviation industry viewed
the outcome as vindication of a journey
it undertook in the previous couple decades
to transition from a safety approach that
almost solely emphasized equipment to
one that also sought to address human
error as a factor. "In the early 1990s, we
introduced what was called cockpit resource management," Skiles detailed.
"We underwent training to give us interpersonal skills to communicate and work
as a team.
"Today, we work and complement

each other; any error or omission by one
is picked up by the other," he continued.
"We pass or fail our checks as a crew. If
the pilot makes a mistake and I do not
correct it, I fail too."
In the early 1990s, Skiles noted, U.S.
Airways suffered through five fatal crashes
in five years. Since then, he noted, "The
last fatality on a major airline was 14
years ago. We owe our success in very
large part to how we changed the industry.
We control the quality of the product by
standardizing the process."
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Industry's Challenges Are Nothing New

SANTA FE, N.M.-The graph's downward trend was undeniable, and when Bruce
Niemeyer, vice president of Chevron North
America's Mid-Continent Business Unit,
asked the audience what it signified during
the New Mexico Oil & Gas Association's
2015 annual convention, Oct. 4-6 in Santa
Fe, a number of voices were quick to
answer: It had to be the price of crude oil.
It was, Niemeyer confirmed, only the
descent reflected not 2014-15 prices, but
those of 1859-60. World old production
quadrupled in the year following Colonel
Edwin Drake's revolutionary oil well in
Oil Creek, Pa., Niemeyer noted, and oil
prices dove from about $10.00 to $0.10
a barrel. "Our industry started with what
we are experiencing now," he pondered.
"It has been part of what we have done
since our earliest days. We all have dealt
with it and are familiar with it."
Even so, the world's appetite for
energy always has helped the industry
bounce back, Niemeyer observed in a
presentation that also considered energy
demand. Later, during a presentation
about his latest project, filmmaker Mark
Mathis suggested a new acronym for
those resources that he said would help

people grasp their centrality to modern
life. Finally, on the convention's final
day, Rob Wellman, chief executive officer
of Social5, offered some insights on how
companies and industry advocates could
use social media more effectively.

Familiar Challenge
Niemeyer estimated the crude price
decline that began in late 2014 constituted
the fifth time in his career that oil prices
had dropped more than 50 percent. "A
year ago, we were at about twice the
price we are today," he reflected. "If you
cut any business's revenues in half, it
represents a particular challenge."
The 1860 price crash was an indirect
result of Drake's innovation, Niemeyer
observed. "He had this novel idea to use
brand-new technology to drill a well into
the earth and stick a pipe in the hole,
which would allow him to go deeper than
anyone before," Niemeyer recounted. "He
was successful and reached a record depth
of 69.5 feet. That technology revolutionized
the industry and changed the course of
events. Estimated worldwide production
prior to that was 500,000 barrels a day.
With this new technology, production

124 THE AMERICAN OIL & GAS REPORTER

grew to 2 million barrels a day."
He acknowledged that the industry's
familiarity with tough price cycles did
not lessen their challenges, but his demand
projections also offered producers reason
for hope. He noted that world population
was on pace to reach 8 billion by 2030,
and said that many of those people would
want the type of lifestyle people in the
developed world enjoyed.
"Any time you wake without power,
your life is transformed instantly," he
pointed out. "Many inhabitants being
added to the world's population are aspiring to have the benefits we take for
granted. So not only will there be more
people, they will be more energy-hungry.
They will seek to enable their lives with
the energy necessary to sustain the sorts
of things we experience every day."
And the sources providing that energy
are likely to remain in many ways the
same, he forecast. Large-scale demand
requires affordability, reliability and availability, he emphasized, and is likely to
prevent many alternative sources from
attaining a significantly larger piece of
the energy mix.
Niemeyer pointed to the example of
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