Hey Oilfield Guys!!

[rubydog]

I guess I missed that some said it drives the whole economy......... But that (as I admitted earlier) could be from bias views on the oil industry that caused me not to catch those comments! No matter what, oil is big in Texas and a bust will,effect the economy in a large way in certain geographic areas.... Maybe not the metroplex areas but many, many rural areas across the state!

I often wonder what will happen to all those little cabin type man camps and RV parks in all those lovely little towns like Floresville, Karnes City, Carrizo Springs and George West if there is a bust? I guess they can turn them into squatter villages for all of Obama's new amnesty workers.

[Take Dead Aim]

I'm not sure where I've said one time you are full of it!! I've simply said that it will have a larger effect on our economy that you say. Your research is fantastic, congrats and good job, yet its 2 years out of date and a lot has happened in the O&G industry in 2 years! You tell me, but The true effect of what the oil and gas industry has on the entire economy would be hard to track...... You take out the DFW area and the the Austin area of the mix and tell me what the major contributor to the economy (housing markets/values, new car sales, ATV sales, land sales,etc) in the Houston, San Antonio, San Angelo, Midland/Odessa, Victoria and Laredo just naming the major cities. Far as all the small communities across the state that will be effected and you saying they diversify well that's a hell of a plan but I guess it's just not that easy. See the small rural communities that we live in Dont have many options to diversify and again it's just not that simple....... I'll wait for you research and suggestions on those.

I've talked to a lot of investment banks over the last 2 weeks and according to them the O&G industry is still a sturdy long term target for them and their money so hopefully that's a positive sign moving forward.

Again.... I've not one time said you are full of it but rather have disagreed with you on the full effect on the economy! It's my belief that the STATEWIDE housing market and real estate market will suffer, new vehicle sales will suffer, etc, etc, etc..... Anyway we can beat this ole horse to death and I guess time will tell one way or the other!

In the mean time I hope and pray we can all find a balance in our industries so that everyone wins and benefits from thriving, profitable and affordable markets!

The sales tax info I posted is actually from 2013. Not sure why I typed 2012. If you click the link it show you 2013. I went back and checked 2012 and there was very little change in any of the major tax categories. Including oil and gas. 4.6% across the boar . Some went up and some went down a little but really very little difference. Sonnow that my data is only 1 year out now what? Still doesn't change anything. City have an option to not be a one trick pony. No its not easy but look at Corsicana. Great small town with tons of diversity.

[kyle1974]

I often wonder what will happen to all those little cabin type man camps and RV parks in all those lovely little towns like Floresville, Karnes City, Carrizo Springs and George West if there is a bust? I guess they can turn them into squatter villages for all of Obama's new amnesty workers.

Now we're diversifying!

[KR-oldmexico]

The sales tax info I posted is actually from 2013. Not sure why I typed 2012. If you click the link it show you 2013. I went back and checked 2012 and there was very little change in any of the major tax categories. Including oil and gas. 4.6% across the boar . Some went up and some went down a little but really very little difference. Sonnow that my data is only 1 year out now what? Still doesn't change anything. City have an option to not be a one trick pony. No its not easy but look at Corsicana. Great small town with tons of diversity.

Corsicana are you kidding me! LOL!

As I've said and many have said.......... The oil and gas industry is one phase, add in pipeline and transportation like they have it broken out and that will close the gap a bit!

You are not following what we are saying brother! O&G is a large part of the sales tax revenue by the people in that industry spending lots of the money they make! Construction business is tied to it (not saying its all or most of it but it effects it), the automobile industry is tied to it (see all comments about all the new diesels that the banks will own or be for sale), land and home (real estate), BEER sales (lol) I kid, I could go on and on! I'm not saying O&G completely drive and control these markets or the economy but it will have a big effect on all of this listed above. Our economy will not crash with O&G but it will **** sure take a hit!

There's a big world and huge state outside of Austin! Larger cities can and will diversify and move on, but the small towns across the state a Rubydog mention have limited opportunities and will get hammered!

I'm enjoying this thread! Keep it coming and let's keep it clean and civil!

[rubydog]

Now we're diversifying!

Hey it is thought worthy...

What will happen to all those RV parks that sprang up on every available lot? Those Mom and Pop businesses will fade away like a poot in a stiff breeze.

[rubydog]

Corsicana are you kidding me! LOL!

As I've said and many have said.......... The oil and gas industry is one phase, add in pipeline and transportation like they have it broken out and that will close the gap a bit!

You are not following what we are saying brother! O&G is a large part of the sales tax revenue by the people in that industry spending lots of the money they make! Construction business is tied to it (not saying its all or most of it but it effects it), the automobile industry is tied to it (see all comments about all the new diesels that the banks will own or be for sale), land and home (real estate), BEER sales (lol) I kid, I could go on and on! I'm not saying O&G completely drive and control these markets or the economy but it will have a big effect on all of this listed above. Our economy will not crash with O&G but it will **** sure take a hit!

There's a big world and huge state outside of Austin! Larger cities can and will diversify and move on, but the small towns across the state a Rubydog mention have limited opportunities and will get hammered!

I'm enjoying this thread! Keep it coming and let's keep it clean and civil!

Keith I'm buying what your selling... I've read every word of it. The connective tissue to the oilfield runs clear to the bone.

I've lived through several booms and busts and worked on the rigs during the 1982 bust. We stacked our rig out in the snow. There were no jobs to be found so I picked up a chainsaw, axe and a split maul and hit the river bottoms and cut pin oak firewood to make a living. I watched plenty of people go bust including Lamar Lewis drilling company, G.N.R. drilling company and Delta.

It is a real concern for this state and the impact from a shutdown in the patch can't truly be comprehended by some until it happens. Kind of like a tornado or a hurricane. People will be seen standing in front of what they once owned wondering what the heck just happened.

[Brooks]

So we are at $66. Who has shut down?

[Legdog]

Buy the integrateds, sell the smaller guys. If a company has some refining business, it will do well in this environment. Killing it on refining but losing money on the upstream part of the biz. It's a nervous time.

[trophy8]

I'm not sure why y'all are arguing with these dudes. They won't ever change their mind till they realize it affects them a lot more than they realize.

[Skinny]

Get back to work men!!!!

[panhandlehunter]

I'm not sure why y'all are arguing with these dudes. They won't ever change their mind till they realize it affects them a lot more than they realize.

First off, I'm not wanting the bottom to fall out of O&G. I don't care one way or the other about gas prices or oil prices. I need gas, I buy it, doesn't matter what it costs, I need it. It's great that everybody is making money. But I promise you, the only way that a slow down will affect me is by saving me money on gas. Some people will have problems with a slow down because they put all their eggs in one basket. But you have to make money while it's there to be made. People who work in the oilfield should know what can happen and have a back up plan. Prices will come back up, probably sooner than later. The other thing is, a lot of people quit their jobs to go chase money in the oilfield. I was trying to hire people for several months and just couldn't find people.

[coldgas]

The drilling has slowed way down up here in the eastern panhandle. I am seeing several work over rigs running on older wells. A lot of the rigs here either moved to south Texas or east Texas. Central Oklahoma is picking up also.

You definitely want to be on the midstream side of the business or be willing to move around the country.

[Drycreek3189]

The naïveté of your remarks is both chilling and revealing. You obviously were not in the business when it was booming in the late 70's and went FLAT bust in 1982! It was devistating to those who thought the money would never stop rolling in (like you). As a banker who worked for awhile in the loan workout area of the largest bank in Texas at the time with a huge portfolio of drilling rig and other oilfield equipment loans. Companies went from people waiting in line at the Offshore Technology Conference to just order their equipment...to not being able to give it away! I could tell you some sad horror stories about visiting our borrowers
offices/plants/warehouses in Midland/Odessa/Houston and seeing ghost buildings! NOTHING was happening. This went from boom to bust in just weeks!

The OP has some excellent advice, and you young folks would be wise to take heed. I cringe every time I see someone selling some souped up AR 15, Leica binoculars or some other expensive toy because of some small financial hiccup. If you don't have money in the bank (or in investments with your Financial Advisor ), you probably can't afford those high priced luxury items if you have to sell them to raise money for your kid 's braces! Just because you have the cash to pay for them (let alone having to finance them) does not mean you can afford them. That cash might should be put back for making the mortgage or truck payment when that job goes away.

They call me Grumpy .. but I have witnessed it!

I would call you WISE. Been in the oilfield since 1970 as an equipment operator, superintendant, contractor, and a consultant. I learned in the 80's that what goes up, must come down. So now, no mortgage, no car payments, no large bills of any kind for years . Feels great !

[Hardware]

Sorry for using 2012 numbers. I was still working and grab the most recent info I could find quickly. I didn't see 2013 and 2014 wont be out for a few months. I was the first and one of the only few to actually post factual info and not just some regurgitated nonsense that they heard from someone else. I actually took a little time today and a bunch over the last 20 years to keep up with what happens and why. There have been many post if not most in this thread from people stating a crash to the Texas economy. Not sure how you missed them. If you will also go back and read my post I stated that I own a heavy site and utility construction company. I have employed between 10- 196 people at one time over the last 15 years. My family and I also have royalties on both oil and gas in a couple different areas around the state. I also have to different investments in actual wells. Not huge commitment on the wells but still money non the less.

So now that you know that, if you will take the time to actually read and comprehend what I have been saying you will see that I am not on either side of this battle. I am just stating what I feel is factual information. Factual in the fact that I have done actual research and time invested in my beliefs. History doesn't lie. Something that 99% of the people haven't done. If I seem curt it because I have spent a ton of time researching and trying to educate only to have people like you tell me I full of it. You can have all the biased view you want that doesn't make it the correct view though. I not here to try and change anyone's mind but rather just inform them. Some if not most in this thread want no part of it.

Again history doesn't lie. There never has been a recession/fall in the US market due to falling oil prices. Rising oil prices yes but falling no. I know we are talking Texas here so that is a little different. Yes lower oil prices will affect the Texas economy and especially those areas tied to O/G but a lot of that money does change hands. It goes out of the hands of those involved in O/G and is spread across to the pockets of all of those living in the US. Some of the money is lost forever. People in O/G lose it, the state loses sales tax dollars, town will dwindle back to nothing because all they ever count on is $ form O/G. My thought is those towns need to diversify. If they never do they will be in this same boat again. I know everyone on this site hates Austin/area but one good thing it does is bring in a multitude of types of business. You have technology with the likes of IBM, Dell, Samsung, Texas Inst. Green with solar and wind companies. Multiple gun makers and more coming. Multiple Universities. Many state employees. That is what it takes to be successful. Being a one trick pony especially when that trick is a commodity is asking for trouble. That enough for tonight.

I know you think we are just giving our own opinions but as you stated above history doesn't lie!!! My comment was only pertaining to the Texas economy and not the whole USA.

I lived through the 80's in Houston working as a Banker and can give you first hand accounts of how it effected Texas. People were walking away from homes because they owed more than the home was worth. People were on the street corners in suites begging for jobs. Several banks fell during this period, real estate markets collapsed, and construction came to an abrupt stop.

I hope I never see the downturn we had in the 80's again but with the idiots we have running this country it's probability is high!!!!

[SaltwaterSlick]

So we are at $66. Who has shut down?

Well it is starting to happen. For instance, over the holiday weekend, Weatherford sold off two of the companies they had acquired... One was in drilling and the other in Frac' Chemicals... They are looking ahead. You just watch the news about "big blue" come late December if oil is below $80/bbl... By march, they will cut 3 billion out of their operating expenses, and do it in 90 days. I don't care what market you are in, 3 billion drop is gonna hurt the little guy... stock will stay strong because it's all about revenue and dividends to the stockholders... It's the working class that will get hammered, and if you go WAAAY back to the OP's first post, that's what this thread was about. It was not about whose market or town was the best, biggest or any of the other argumentative talking points that have come up. It was about a "heads up" to the working stiffs with no experience of what has happened before and likely to happen again, maybe sooner rather than later. The OP's first post is still very true and very appropriate. Beyond that, none of this other stuff really matters much.

Carry on boyz...