American Oil and Gas Reporter - July 2016 - 96

The 2016 elections should leave Republicans in control of the House of Representatives unless Democratic Presidential
Nominee Hillary Clinton wins a landslide
54 percent of the popular vote, predicts
University of Oklahoma political science
professor Keith Gaddie. He noted that
Lyndon Johnson, Franklin Roosevelt and
Andrew Jackson were the only three Democrats to ever win that large a share of
the electorate.

probably would not bring much change.
He held that, absent an unpredictable
"black swan" event that swung many voters, presumptive Democratic nominee
Hillary Clinton was an overwhelming favorite to win the White House unless presumptive GOP nominee Donald Trump
received a surge of unexpected support.
"If (Trump's nomination) is a disruption
event, turnout will spike," he predicted.
"But if you want to know what the forecast
looks like now, there is a nine in 10
chance Clinton wins the presidency."
One point Gaddie cited to suggest the
political landscape was hardly in upheaval
was that only two of the 170 members of
Congress with primary challenges lost their
contests. "Usually, when there is anger in
the electoral system, incumbents in both
parties start losing primaries," he related.
"Pretty much every congressional incumbent
with a primary opponent is going to be on
the general election ballot."
According to Gaddie, Republicans can
count on winning 207 House seats, while
Democrats have a lock on 177. Among
districts with less pronounced partisanship,
he said 20 leaned Republican while 13
leaned Democratic. "If nothing changes,
Republicans control the House with 227
seats at a minimum, and they may go up
to 236," he predicted. "They are at 247
seats now; it takes 218 to control the
chamber."
The only scenario Gaddie mentioned
in which Democrats won at least 218
seats required such a landslide victory
for Clinton that her proverbial coattails
would carry numerous Democratic challengers to victory in states such as Arizona,
96 THE AMERICAN OIL & GAS REPORTER

Colorado, Nevada and Utah. That can
happen only in the unlikely event she
wins 54 percent of the popular vote, he
said.
"Only three Democrats in American
history have gotten 54 percent: Lyndon
Johnson, Franklin Roosevelt and Andrew
Jackson," he reported. "You really have
to go deep to find this kind of power for
Democrats nationwide. It probably is not
going to happen."
Gaddie's analysis of the electoral college held that Clinton was sitting on 253
electoral votes and Trump 191. "The
game is in Virginia, Florida, North Carolina, Iowa, Colorado and New Hampshire," he listed. "For the Republicans to
win the presidency, they have to win
states they have not won with any consistency since Ronald Reagan's presidency:
Michigan, Ohio, Pennsylvania and Wisconsin. All the down-ticket indicators
show these states, except for Ohio, probably go Democratic."
As he looked at the 10 competitive
Senate seats in 2016, Gaddie suggested
Democrats also appeared poised to win
control of the U.S. Senate. "The Democrats
probably take back the Senate, but it
does not matter," he assessed. "Getting
anything done in the Senate requires 60
votes. The one appointment that still can
be filibustered under Senate rules is a
Supreme Court appointee, so no matter
who the president is or who controls the
Senate, filling the vacancy created by
Justice Scalia's death will require a compromise."
Gathering Storm
During a panel discussion about gas
gathering and transportation, moderator

David Le Norman of Le Norman Operating indicated many midstream companies
largely had shifted from offering percentage of proceeds (POP) contracts to
fee-based pacts. He compared and contrasted midstream companies' shares under
various commodity pricing scenarios, and
noted that fee-based contracts tended to
favor gatherers during price slumps.
"I have seen contracts in which the
midstream and upstream both are getting
$1 of $2 gas," he illustrated. "Historically,
the upstream guys get 70-75 percent of
the value of the stream."
Le Norman asked Clearwater Enterprises LLC President Tony Say about the
midstream contracts offered to his company, which is both a producer and a
marketer.
"If you are drilling actively, have
acreage under contract, and are looking
to connect your wells, generally the offers
will be better than offers for an offshoot
well," Say related. "On the marketing
side, if clients in new areas have a sizable
amount of acreage they can dedicate,
then the offers seem to be a lot more
competitive."
Santa Fe Midstream Managing Partner
and Chief Executive Officer Greg Kegin
acknowledged that upstream companies
shouldered greater risk and should therefore receive a commensurate proportion
of the reward. He suggested that many
midstream companies were having trouble
adjusting to the price cycle's downside.
"In the good times, we come to rely on
those higher fees and then, in the tougher
times, and it is more difficult for some
midstreamers to retrench," Kegin assessed.
OIPA Chairman McDougall concurred

Phillips Murrah attorneys and directors, from left, Stephen Elliott, Clayton Ketter, Elizabeth
K. Brown and Melvin McVay prepare to discuss options available to companies in ﬁnancial
distress. A couple panelists pointed to workouts as a way companies could avoid bankruptcy.

American Oil and Gas Reporter - July 2016

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