.

When I was preparing for my first trip to the Marcellus Shale, I was approached by someone who lived in Upstate New York to discuss the issues that was going on in DISH as well as the Barnett Shale in general.  As we began discussing the lessons learned here about leasing, and the amount of money given at lease signing, he interrupted me to state that in several small towns in the Upstate New York area, they were ready for drilling to begin…for the jobs.  He further stated that everyone was waiting to get “their new white pickups and Halliburton hard hats”.  That they were not even concerned about the leases and that most had already leased for one or two dollars per acre.  He continued to state that when I mentioned the $ 30,000.00 per acre that was once offered in the Barnett Shale, some would collapse in tears, knowing that they had been taken advantage of by this industry.

.

Throughout my several tours around the country, the question about jobs and the vast influx of money into the local economy came up constantly.  I quickly found that my new friend was right, there were a large number of people who really thought they would soon have a new white pickup and Halliburton hard hat.  I always asked the crowd, “how many certified pipeline welders do I have in the room?”  They seemed to quickly get the point that most of the folks in rural New York would not have the skill set required to work in this industry.  Although, I do know of folks here in Texas that started working on a drilling rig with no experience, and worked their way into a nice paying job, it is unlikely with the slowdown, that the industry would need to hire people with no experience.  So any jobs would be entry level and low paying.  There are plenty of folks out of work with experience in the industry.

.

In areas of Pennsylvania where gas exploration had begun, there was a noticeable amount of vehicles with Texas plates that highlighted this point.  I was almost offended when the local population complained about the amount of Texans that followed the natural gas boom to this area.  It was apparent that the population increase was not something that they were yet comfortable with.

.

While growing up in the Oklahoma oil fields, we went through the boom and bust cycle several times.  It seemed as though most of the males would go to work in the oilfields after graduating high school and made a decent living for themselves.  However, with the economy based upon this one industry, the downturns were pretty severe on the local economies.  When the bust came, it left everyone scrambling to find another job.  However, with the economy based on this one industry, most of the jobs were either in the industry or supporting the industry.  Therefore, in the bust, there were not many jobs to be found.  This resulted in many of the small rural towns to simply dry up, with people moving away to find work.

.

On a recent trip to New Mexico, I met with Gilbert Armenta, the New Mexico rancher depicted in the documentary Split Estate.  Mr. Armenta has spent his entire life living with the boom/bust cycle in Northwestern New Mexico.  In this part of the country, the oil and gas industry is the predominant industry.  As the industry has cooled over the last year or two, he stated that there was 12 % unemployment in that area.  I might add that the Farmington, New Mexico mayor was nice enough to write a letter with some negative comments about yours truly, as well as talking about how great the industry was to him.

.

One thing that I had heard on several occasions is that when the eventual bust comes, the crime rate goes up almost immediately.  Mr. Armenta confirmed this fact during his presentation, that crime levels increase particularly during the bust cycles.  He further stated that the crime that increased the most was robbery.

.

What has happened in Mr. Armenta’s area is that it is solely an oil and gas economy.  All other industries have moved on and therefore everything directly or indirectly is dependent on this industry.  So even if you do not work directly for the industry, when the bust comes, you are affected.  In our local area I have noticed over the past several years, that we have been going through a transformation to an oil and gas economy.  In some areas of the Barnett Shale, the transformation has already taken place.  We managed to avoid an economic catastrophe only because the industry has continued to drill when it wasn’t profitable, knowing that regulation was coming.  Otherwise, many of the towns in the western part of the shale would have simply went away.

.

It has become very tempting for cities to embrace the explorations for the quick shot of tax revenue with the budget shortfalls over the last couple of years.  Falling to this temptation has led to more and more of the area transforming to this new economy.  Unfortunately, when the bust comes, and we know it will, the entire area will be devastated.  This may very well lead to this area being destroyed economically at some point, because we know that this is only temporary.  It is key for cities to develop strategies for sustainable funding that is not primarily put on the backs of the taxpayer, and does not destroy future growth.

.

Unfortunately, one city that comes to mind is the City of Fort Worth.  This city has the largest number of gas exploration activities of any city in the world, yet financially is by far the worst in this area, having a 73 million dollar shortfall this year.  Part of this expenditure is a $600,000.00 air study to determine if the exploration activities is harmful to public health.  Fort Worth is also home to several of the exploration company’s headquarters.  The downturn has affected everyone, but the city most dependent on the natural gas revenue, is the one doing the worst financially.  As Tim Ruggiero would say “it does not take a PhD in economics to see there is a problem here”.

.

Another thing that this does, is give the industry extreme leverage to demand things like tax breaks and loose regulations.  They simply threaten to pack up and move somewhere else, and take the jobs with them.  When it is an oil and gas economy, them leaving makes a ghost town.  Although this is only a threat, local officials are held hostage by this threat.  So they give in, and keep cutting the setback requirements like the City of Fort Worth continues to do, or they allow this industry continuously cut corners putting their citizens at risk.

.

For some here it is too late to build a diverse economy, there will be booms and busts, it will be feast or famine.  However, for some of you out there this does not have to be the case.  Look ahead and do not let this industry take over your economy and hold you hostage like it is doing in many other parts of the country.  Be very careful of what you wish for.

Calvin Tillman
Mayor, DISH, TX
(940) 453-3640

“Those who say it can not be done, should get out of the way of those that are doing it”

.

May 5, 2010

“Gas Companies Are Picking the Pockets of the Citizens of Pennsylvania”

.

There have been a lot of my friends in the industry who have found it necessary to begin aggressive personal attacks on me.  Several industry publications, such as the Powell Barnett Shale Newsletter have had articles and editorials stating that I am pretty much everything but a nice person.  This activity is not new; however, the intensity has been elevated and it has gotten much more personal.  This tells me that I must be making an impact, or they would not attack me personally. This also tells me that they have given up on attacking the message, now they are only attacking the man.

.

Obviously, anyone who would bother to read the Powell Newsletter knows that it is industry funded.  As everyone also knows by now, I do not accept compensation or travel expenses for my presentations, and unfortunately those at the Powell Newsletter can’t say the same.  They are in all reality a paid cheerleader for the natural gas industry, join me Gene…rah rah rah…gooooo… Chesapeake.

.

Frankly, if the industry wants to truly be successful they would embrace the ideas that I bring forward, which is doing business in a respectful and responsible manner.  I find that in every presentation I give, there are always a few who show up that have read the propaganda and are looking for a fight.  However, after listening to my message it is apparent that I am not some anti-drilling wacko and the picture that has been painted of me is inaccurate, and it is always nice to hear that they agree with my points before they leave.

.

Everyone knows that the industry has an ugly baby, except for the industry themselves.  I know it must be difficult to admit your baby is ugly, but like they say about alcoholics, you must first admit you have a problem before you can move on.  Instead this industry continues to deny their baby is ugly.

.

There is really no doubt for anyone who has accomplished even a small amount of research that there is certainly a downside to this industry.  If this downside is not mitigated in some manner we will be looking at a mess that will need to be cleaned up down the road when all of these companies are long gone.  As history has shown us, these companies are typically nowhere to be found when it comes time to clean up the mess.  That cleanup project is left for the citizens and taxpayers, not the companies who made billions making the mess.  The industry will outsource this cost to the hard working American people, just as they try to do for all of their costs.

.

The industry wants us to believe that they are a fledgling industry who cannot afford to take simple measures needed to make the shale plays a win-win situation.  I think that most of us know that this industry spends billions lobbying to prevent them from being mandated to do it right.  Therefore, they could and should do this process more responsibly and respectfully.

.

They are picking the pockets of the citizens of Pennsylvania, who will be paying for the mistakes made by their elected officials for many years to come.  This state is one of two that have oil and gas activities, and do not have a severance tax for the minerals.  They pay this tax in every other state, and will gladly pay it in Pennsylvania, but continue to lobby for the outsourcing of their costs to the taxpayers.  This could be billions when it is all said and done, but as it stands, the billions will come from hard working Pennsylvania taxpayers.

.

Every location that has natural gas exploration in Pennsylvania has something in common, and that is destroyed roads.  Instead of being the good neighbor we keep hearing about, they outsource the cost of the road repair to the taxpayers.  However, these small communities simply can’t afford to pay the hundreds of thousands of dollars in road repairs; therefore, the citizens in these areas drive on destroyed roads, worse than I have ever seen.  If the natural gas industry wanted to improve their image, they should embrace a severance tax in Pennsylvania, instead of chasing me around the country.

.

As the oil slick in the Gulf of Mexico shows, we are one wrong move from a catastrophic event.  As any good Texan does, I really enjoy my gulf shrimp.  Unfortunately, thanks to the reckless actions of this industry, it will likely be several years before I can enjoy it again.  That is not the bad part though; the bad part is that something similar will happen here before this is over.  It is only a matter of time before we have that catastrophic event somewhere in one the shale plays.  However, in the shale plays they have put this hazardous activity in school yards and neighborhoods.  So guess what is going to happen when the catastrophe happens here?  There will be a lot of dead people.

.

The last editorial written by Gene the “propaganda machine” Powell himself, was entitled “All Hat and No Cattle” (http://www.barnettshalenews.com/documents/2010/TillmanEditorialAllHat4-27-2010.pdf).  I must admit that I do not have any cattle.  However, I would like to have cattle, but I am afraid they would die or abort their calves, like they do in the small town of Clearville, PA, home of Clearville Gas Storage.  In this area the hard working Americans have to purchase their own filtration system to take the high levels of arsenic out of their well water.  Most of the surface and ground water has been contaminated by this reckless industry in Clearville, PA.

.

As one of my new friends in Pennsylvania said, I am the new villain for the industry extremists.  They rally around the Powell Newsletter, which gives me an entire section of every issue.  Whatever happens, they blame me for their problems.  If a large landowner refuses to sign a one sided lease, it will be my fault.  If a community demands that the industry be responsible, it is that Calvin Dewayne Tillman’s fault.  When people rally around the idea of a fair and equitable severance tax…yep, you guessed it…Calvin’s fault.  It has nothing to do with the industry that has contaminated dozens of private water wells in Pennsylvania, and is destroyed air quality and property values wherever they have been, leaving a path of destruction in their wake.  It has nothing to do with the industry that outsources its cost to the taxpayers, while its executives make hundreds of millions dollars in bonuses.  Nope, those things have no influence on public perception.  It is only that mayor of DISH; Calvin Dewayne Tillman, that causes all of this grief for the natural gas industry.

.

If the industry would be responsible and respectful, instead of searching out a new way to attack me, they would be much better off.  However, it appears the more they attack me, the more people come to see what the big deal is.  As bad as they hate it, every presentation that I give is to a packed house.  Furthermore, I find dozens more who want me to speak in their town.  People want to know the truth through eyes of someone that has lived it, not a paid cheerleader.  I truly wish the industry would do the smart thing and let me help them become responsible and respectful.  However, they are going to continue to be the irresponsible bully, blaming me for all of their problems.

.

Mr. Powell is right on another matter; I have no shortage of arrogance against this industry.  Maybe it was my Oklahoma raising, or the fact that my parents would not allow me to stand by while a bully ran over those too passive to defend themselves, but I am not afraid of this industry and certainly will not be deterred by their personal attacks.  Frankly, seeing this fear that has been struck in these industry extremists keeps me going, when my energy has run out.  You should see the looks on their faces, when I walk over and shake their hand.  So I hope Mr. Powell and the extremists keep “Poking the Bear”, regurgitating the same propaganda, because in the end, that may be what forces them to be respectful and responsible, and hopefully those companies that choose not to will perish.  God bless.

Calvin Tillman
Mayor, DISH, TX
(940) 453-3640

“Those who say it can not be done, should get out of the way of those that are doing it”

On April 17, 2010, Calvin Tillman, mayor of Dish, Texas, and Texas citizen & landowner Tim Ruggiero address an audience in Clearville, PA as part of Tillman’s return visit to NY & PA, 4/15-19

Must-see:  Spectra Energy Watch’s blog  -  “Two Texans Share Shale Gas Experience”

.