American Oil and Gas Reporter - March 2016 - 99

ConventionCoverage: Louisiana Oil & Gas Association
demand increases. He recommended
watching gas usage in the industrial and
electric generation sectors as indicators
for future demand growth over the next
several years.
The federal government's decision to
allow U.S. oil exports, barred since 1973,
is likely to help domestic producers caught
in the pricing downturn, IPAA's Miller
said.
"We know about price collapses, and
the meteoritic rises and drastic falls. We

have seen this happen, and we know
prices will come back," Miller offered.
"My advice to those too young to have
seen the 1986 price collapse is that this
is a difficult time, but the oversupply is
much thinner in terms of where we are in
the world market."
According to an ExxonMobil forecast,
prospects for oil and gas careers are outstanding for at least the next 25 years,
Miller said.
"Energy prices and energy requirements

are going to continue to rise. It may take
a while, and we have to get through this
year, but in 2040, those of you in this
room who are young enough to still be in
the business, I think will still find it a
very viable business," Miller predicted.
"I urge you to use this opportunity and
others like it to support your associations,
because that is where you meet the people
you are going to do business with now
and in the future."
❒

New Governor Tackles Budget Deficit
LAKE CHARLES, LA.-Louisiana's
budget deficit will top $1.9 billion when
the state's fiscal year begins July 1, and
may prove even larger, Governor John
Bel Edwards warned the Louisiana Oil
& Gas Association. Addressing LOGA's
annual convention, the Democrat said
good communications between the oil
and gas industry and state officials were
crucial for getting through difficult times.
"To put it into perspective, that is the
largest budget deficit ever inherited by
any governor in Louisiana history," Edwards stated. "What makes it particularly
challenging is it is the eighth straight
year of revenue shortfalls. So, all the relatively easy things to do were done years
ago-all the cuts that really did not hurt
people and all the efficiencies that could
be found."
The $1.9 billion budget gap excludes
costs associated with inflation or merit
raises for state employees, increasing the
K-12 school funding formula, or any increases in the state's higher education
programs, the governor pointed out. He
blamed the deficit on years of unsound
budgeting, lack of discipline, and dishonest
practices.
"It is not all about the price of oil,"
Edwards states. "About 25 percent of our
problem relates to oil. The rest of it is
across-the-board tax collections that are
lower than they were supposed to be,
and also because we have not accounted
for the number of students going to our
K-12 schools. We also did not account
for the number of people who are going
to receive services under Medicaid."
Edwards said he was calling a special
session, which was to start on Feb. 14
and provide legislators a head start on
fiscal planning before the regular session's
mid-March opening.
Edwards pointed out that 10,000

Louisiana oil and gas workers lost their
jobs during the past year, showing the
impacts of the worst downturn in the industry since the 1980s. Louisiana does
not control the world oil market, he said,
so he could not promise any short-term
relief to the state oil and gas industry.
"But I do know-and you know this
because you have been in this business
for many years-these things run in cycles
and there is a better day ahead," Edwards
predicted. "I am just not sure when that
is going to happen. But the challenges
that you face are similar to the challenges
I face as governor. These are tough times,
but I know that working together, we can
get through them."
Legacy Lawsuits
The governor told LOGA his position
on legacy lawsuits had not changed since
he debated the issue with the association
in 2015. He repeated his belief that the
Louisiana Constitution did not offer the
legal relief LOGA desired. Also unchanged
was his willingness to talk to the oil and

gas industry about the issue, Edwards
said. He noted that during his eight years
in the legislature, he was willing to come
to the LOGA offices and discuss legislation.
"That is the same attitude I am going
to have as governor. I am willing to work
with you to find a way to help with this
particular situation. But, I am going to
be true to myself and to the oath that I
took to the Louisiana Constitution as
God gives me the ability to understand
that document," Edwards said. "I am
going to listen to all viewpoints, and I
am absolutely mindful that I need the
ability to change my mind as facts change.
That is a commitment I make to you today."
The governor said that despite any
differences between himself and producers,
he wanted to work with them to benefit
the state, while helping the oil and gas
industry restore its profitability. He described Louisiana's citizens as its most
precious natural resource.
"Those are the people whose jobs

Don Briggs (left), president of the Louisiana Oil
& Gas Association, visits with Louisiana Governor John Bel Edwards
following the governor's
remarks at LOGA's annual convention, held in
Lake Charles, La.

MARCH 2016 99
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