LAREDO, Texas – The possibilities of another boom period in the Eagle Ford Shale region are unlikely right now, but key stakeholders in economic and workforce development agree a new positive era is coming.
The difference this time, they say, is they have learned from the past.
“When the oil prices dropped, there was a time to pause and make a sober analysis of just what we have, what have done right in the communities, and what we have done wrong,” said Leodoro Martinez, chairman of Eagle Ford Consortium. “So, if this starts up again we want to make sure we don’t make the same mistakes again.”
Martinez gave his comments to the Rio Grande Guardian following an Eagle Ford Consortium regional quarterly meeting Tuesday morning at Laredo Community College’s Fort McIntosh campus. The top concerns raised were the infrastructure, environment, impact in the community, training and workforce.
During the meeting, Martinez said his group represents the community within the shale. He said the group’s goal is to make sure any issue that arises is addressed.
Lessons learned from mistakes made in the past, Martinez said, include having a better appreciation of where and how people in the shale are losing their jobs; how governments need to be wise about their assets and the need to invest back in the community.
“We see the activities starting to pick up. Most of all they have to do with the price of gas, and in the last 90 days the prices have started to hold steady,” Martinez said. “We are anticipating, hoping that sometime next year you are going to see more activity. But it’s important that when that activity comes back we handle it properly.”
The Eagle Ford Consortium started around six years ago, with the purpose of making sure local residents were able to get a good job, and that they had proper training to fit the oil and gas industries. The Consortium has six different committees with representation from Laredo to Corpus Christi.
This industry has impacted the counties within the shale and also all of South Texas, Martinez explained.
Ricardo J. Solis, president of Laredo Community College, spoke during the opening remarks. Solis said he agreed with those who said that with a new administration in Washington, D.C., there has been a lot of uncertainty. But, he said, at the same time there is now a lot of opportunity.
“We are very optimistic that despite all the rhetoric that’s going on about U.S.-Mexico relations and business and commerce, I believe the economy is provides evidence of what’s taking place,” Solis said. “The market speaks for itself. There’s total optimism about U.S.-Mexico commerce, about the prospect of trade and growth, and that will continue to spike.”
Vincent R. Solis, vice president of instruction and student services at Laredo Community College, said the oil and gas industry is rebounding. As an example, Vincent Solis mentioned that the rig count in the United States has gone up by a 50 percent in the last year.
“The latest number show 754 rigs, with at least half being in the State of Texas, and 20 percent of that half is located in the Eagle Ford Shale,” Vincent Solis said. “From my perspective, we have been looking at a rig count has gone up substantially at the least in the last 12 months.”
Vincent Solis added that by the second week of February, U.S. hit over nine million barrels of oil production nationwide, and the projected production for March is an 80,000-barrel increase per day, with 14,000 coming out from the Eagle Ford Shale.
Vincent Solis explained that they expect a slower, more control, pattern of growth instead of the large boom in the area that was experienced ten years ago, especially because of new technology and the life of the wells.
Rogelio Treviño, executive director of Workforce Solutions for South Texas, explained that job postings (which can vary between just few and hundreds of employees at a time), has changed dramatically. While in 2013 there were 23 job postings and 300 unemployment claims, in 2014 that amount changed to 119 job postings with 429 unemployment claims. By 2015, there was a big decrease with only 40 job postings and 2007 unemployment claims. In 2016, there were 19 job postings and the unemployment claims dropped to 1,056 people.
“The early numbers in 2017 show that we have started to get the job orders to increase again,” Treviño said. “Statistically, it shows that job orders and job postings are increasing again, and unemployment insurance applications are dropping.”
Treviño said he has heard some employers say they can probably do a lot more, with less of a workforce.
“We don’t foresee that the employers will have the number of people hired that we saw back when the original boom for the Eagle Ford, and that’s listening to what the employers have told me,” Treviño said.
One company whose business involves hydraulic shale fracking operations is Lewis Energy, which has been in operation for 35 years. Michael Garcia, human resources director of operations for Lewis Energy, said his company has felt the pressure of people moving to West Texas.
“We are seeing some activity down in South Texas but probably nothing like we are seeing in West Texas, and that’s brings pressure to our area,” Garcia said. “Also, there’s a shortage in material and services companies, especially the big ones, and if they come the charge is higher.”
Other issues Garcia mentioned was the production of pipes, and the high demand for sand.
Still, he said the future looks good, especially after his company had a successful job fair.
“There’s a lot of folks out there with industry experience now that we have never seen before,” Garcia said. “We do a lot more now with two rigs than what we did before.”
Garcia said they don’t expect to see the numbers they saw years ago, but instead they expect a controlled, stable, growth.
Rodney H. Rodriguez, Laredo Community College’s executive director of economic development and external affairs, said the Eagle Ford Consortium’s quarterly meetings are very important.
“This conference is of great importance to our educational and governmental partner organizations to have discussions on available resources to meet the business needs of our region,” Rodriguez said in a press release. “It is only through collaboration and a spirit of partnership that we succeed as a region.”
Other topics mentioned during the “Recent and Projected Trends for the Eagle Ford Shale” panel were the importance of training in the electronic and electricity areas, the need for soft skills training, and safety and OSHA training availability, especially in relation to 8-wheeler drivers, fatalities and the need to improve highways and infrastructure.
The Eagle Ford Consortium will have its 6th Annual Conference on June 7-8, 2017 at UTSA Downtown in San Antonio.