American Oil and Gas Reporter - June 2017 - 121

ConventionCoverage: Kansas Independent Oil & Gas Association
people on Ways and Means understand
how important percentage depletion is."
Cross drew attention to the House of
Representatives' late-March decision not
to pursue repealing the Affordable Care
Act as significant because "failing to
unite the Republicans to scrap Obamacare
could foreshadow problems within the
party when it looks at other policy such
as tax reform.
Refining And EPA
Another topic Cross said he discussed
with Washington officials was foreign
ownership of U.S. refineries, which he
commented had become a major focus for
the Domestic Energy Producers Alliance.
Cross said foreign countries already
owned 30 percent of U.S. refining capacity,
and observed that Venezuela had pledged
its U.S. Citgo refining assets as collateral
for loans it received from Russia (see related story, page 123). "If Venezuela defaults, Russia will get those Citgo refining
assets, and with them 10 percent of U.S.
refining capacity," he remarked.
In addition, he said Saudi Arabia was
making bids to purchase Shell's Motiva

Kansas' new First District
Congressman Roger Marshall (left) gets some input
from convention co-Chairman Cecil O'Brate, owner
of American Warrior Inc.,
during a brief appearance
at the Kansas Independent
Oil & Gas Association's
midyear meeting, April 1921 in Garden City, Ks.

refineries on the Gulf Coast.
"This seems to be a new strategy for
many of these countries to capture markets
for their production and limit markets
for U.S. production," Cross worried.
Turning to better news, Cross called
former Oklahoma Attorney General Scott
Pruitt's confirmation as Environmental Protection Agency administrator "likely one
of the most important events of the Trump
administration for our industry." Cross

pointed to Pruitt's confirmation promise to
end EPA's previous practice of adopting
regulations that exceeded its statutory authority and ignored congressional intent.
Cross mentioned that President Trump's
fiscal 2018 budget blueprint called for
cutting EPA's budget from around $8 billion to about $6 billion, and reducing staff
from 15,000 to 12,000. "Trump said, and
I quote, 'It is deconstruction of the administrative state,'" Cross affirmed. r

Hamm Personiﬁes The American Dream
GARDEN CITY, KS.-Teamwork, a
focus on technology, and a "culture of
the possible" helped build one of America's most successful oil companies, according to the keynote speaker at the
Kansas Independent Oil & Gas Association's midyear meeting.
Gary Gould, senior vice president of
production and resource development for
Continental Resources Inc., used his April
20 dinner address to KIOGA to salute
Continental founder and Chief Executive
Officer Harold Hamm as "the personification of the American dream."
Continental is celebrating its 50th anniversary this year, and Gould recalled
how Hamm, the 13th child of a sharecropper family, got into business for himself by borrowing $1,000 to buy a waterhauling truck. "He worked hard from the
very beginning to understand how to
build an oil and gas company, and did it
through teamwork," Gould praised.
That spirit of teamwork is alive today,
he continued, in weekly meetings that
include everyone from technicians to the
CEO. "That really energizes everybody
in the company," Gould described.

It also is educational for new employees,
he added. "They get to absorb a strategic
discussion among multiple disciplines and
see how decisions are made," Gould said.
"It is a great way to build leadership."
Another key to Continental's success,
Gould went on, has been Hamm's commitment to technology. An example he
described is the Cedar Hills Field in western
North Dakota. In the mid-1990s, when 80
percent of wells were being drilled vertically,
Gould said Hamm chose to develop Cedar
Hills' 10-foot pay section horizontally.
"Cedar Hills became the largest oil
field discovered in the continental United
States in the prior 30 years," Gould
related. "It also became the first U.S.
field developed solely with horizontal
wells, and it became the largest horizontal
waterflood in the world.
"Learning that technology early, I
think, really helped the company apply it
to the next opportunity, which was the
Bakken," Gould determined.
Working For Industry
Turning to Hamm's contributions to the
industry as a whole, Gould said he began

working in early 2015 to convince his industry peers that U.S. crude prices never
would gain parity on the global market as
long as domestic oil could not be exported.
Gould said Hamm eschewed advice
to hire government consultants and expect
a two-three year process. "Harold didn't
think that would work," Gould recalled.
"So he and our vice president of government affairs were in Washington every
day it was open.
"They were making presentations constantly, and providing data and references
that showed how America was being hurt
(by the export ban)-not only oil and gas
producers, but all the way to the consumers
of gasoline," Gould said. "That is the
type of individual Harold is."
Congress repealed the crude oil export
ban late in 2015, and Gould praised
Hamm for being one of Donald Trump's
earliest campaign supporters the following
year. He said Hamm put together the
Trump Leadership Council on 10 major
American industries, including energy,
agriculture and others, to advise the president-elect. "I think that was very, very
important in helping us get these changes
JUNE 2017 121

American Oil and Gas Reporter - June 2017

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