American Oil and Gas Reporter - April 2018 - 32

Manual Water Sourcing

Online Marketplace

Source #2
5 calls
2 emails

Source #1
3 calls
1 email

* See All Options at All Times, Instantly

Source #3
1 call
4 emails

* Find Best Prices from All Suppliers
* Ensure Water Supply Chain
* Transparency & Visability
* Maximize Utilization & ROI

Source #5
2 calls
2 emails

Source #4
8 calls
2 emails

* Quantiﬁed Accountability for Safety,
Reliability, Performance, Results

This for only 5 options one time!
SOURCING EFFORTS:
Drive Time: 105, Door Knocks: 35, Calls: 133, Emails: 77,

Time: 3 months,

Man Hours: 70

An example of a "low-tech" innovation with dramatic disruptive
implications, Sourcewater has created a database of more than
100,000 sources of water in the Permian Basin containing contact
information, types and quality of water, dates of availability, loca-

How do we locate all these sources, optimize the options
and negotiate the best deals, all at the same time? Believe it or
not, landmen and even completion engineers (who have other,
quite demanding jobs to do) drag out their Rolodexes, call up
their buddies from school, hoof it around the neighborhood,
and knock on doors.
Consider this: Howard County, Tx., an active area in the
Midland Basin, has 23,000 surface owners with properties large
enough to source water, not to mention all those other options.
Enter Sourcewater, an online water marketplace for the
energy industry founded at MIT in 2014 by a Sloan Fellow and
entrepreneur with no knowledge whatsoever of the energy industry. He saw a single chart illustrating skyrocketing investments
in hydraulic fracturing from 2005 through 2012 and detected
an opportunity hiding in the water market's profligacy.
Today, Sourcewater is disrupting the industry's traditional
"relationship-based" procurement with a smarter data-based
strategy. For the first time, all the data needed to optimize timesensitive water deals within a particular geographic range-
contact information, types and quality of water, dates of
availability, locations, volumes, flow rates, rights of way and so
on-can be found in one place.
At present, Sourcewater has more than 100,000 listings and
more than 1,000 users in Texas alone, and it's growing. Think
of it as the Amazon.com for water.
Online marketplaces are excellent examples of seemingly

tions, volumes, ﬂow rates and rights of way. Making available all
the data necessary to optimize time-sensitive water deals is changing the industry's traditional relationship-based procurement.

"low-tech" innovations with dramatic disruptive implications.
It's not all robots and rocket ships. Another example is RigUp,
a marketplace for on-demand access to every imaginable rigsite contractor and service provider-a sort of Uber for oil. I
suspect we will see more of these in the coming era.
Tipping Point
At Tudor, Pickering & Holt's Energy Disruption Conference
last November in Austin, I saw something that exemplifies our
industry's stimulating new relationship with the tech sector.
Mingling among the gray hairs and suits were a couple of Millennials from West Coast startup Tachyus, one of whom proudly
wore a T-shirt proclaiming: "I ♡ Fossil Fuels!" Some 300
people from both coasts and everywhere between-tech companies,
oil and gas operators, venture capitalists-rubbed elbows for a
day and went away energized.
Since 2000, something like 50 percent of Fortune 500 companies have disappeared. Why? Corporate mass extinction by
digital disruption, like the asteroid that ended the era of the dinosaurs.
Our only hope for the future lies in filling these empty niches
with something smaller and more agile, like our mammalian ancestors. "This year," says Pioneer's Dove, "is the tipping point
for digital transformation in oil and gas. We have to invest in innovation. If you are standing still, you are falling behind."
r

John W. Gibson is a senior adviser to Tudor, Pickering & Holt. He spent the first 10 years
of his energy career working for Gulf/Chevron. Gibson's background supports his focus on
minimizing environmental impacts associated with energy development and digital innovation. He previously served in executive roles at Landmark Graphics, Paradigm Geophysical,
Tervita and Halliburton. Gibson is a director of Orocobre Limited and I-Pulse Inc., and is
on the University of Houston's Energy Advisory Board, the Visiting Committee of the Texas
Bureau of Economic Geology, and the USC Global Energy Network Advisory Board. He
also is an adviser to Cottonwood Venture Partners. Gibson earned a B.S. in geology from
Auburn University and an M.S. in geology from the University of Houston.
JOHN W. GIBSON
32 THE AMERICAN OIL & GAS REPORTER

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