Note from your editor – over two years ago OWOE printed a similarly titled blog The Human Side of the Oil Price Collapse, and shared a story from an expatriate couple living in Angola about the impact on the people of a country where everything is directly or indirectly dependent on oil. This blog by an engineer in Houston brings the situation closer to home and shares how she and her family have coped and even prospered.

Guest blog by Ms. Kelley Ellis

My husband and I are native Houstonians.  We were kids in the 80’s when the oil market crashed, and although neither one of us had parents in the oil business to be impacted directly, like all families in Houston, the economic downturn trickled into our families’ realities.  So when we got married soon after I graduated from Texas A&M at Galveston in 2000 with a degree in Maritime Systems Engineering as oil prices climbed back up from a 1998 low, we knew that my job would never offer the stability that his job as a firefighter offered.

A layoff for me in 2004, when the company I worked for was shuttered due to a liability with asbestos, cemented our knowledge that while my job would offer a higher salary, this salary came with a caveat of stability.

Nevertheless, after a few stints transitioning through companies, soon enough I was fortunate enough to join a growing firm that offered some stability. By the beginning of 2014, the two of us had grown into a family of 5, and like many families supported by the Oil and Gas industry, things were financially easy.  Years of end-of-year-bonuses meant we could pay down debts, make improvements on the home we had bought in 2006, and take our boys to Disney World.  My husband had expanded his career and gone to graduate school, which we were able to pay for without student loans.

We had season tickets for the Texans, supported our favorite charities, and participated in hobbies (in what little spare time we had as full time working parents) with minimal conversations about how we would absorb the impact on our family’s financial situation.  At this point in our lives, we were also spending approximately $25,000 a year in full time childcare for our 3 boys.

In the spring of 2014 my company signed a big EPC (engineering, procurement, and construction) contract for a new deepwater offshore platform that seemed like it would last for a few years, and the company was bought by a new owner at the beginning of October.  Things were looking great.  By the end of 2014, oil prices had plummeted, the huge EPC contract had been cancelled, year-end bonuses disappeared, and the writing was on the wall.  Our first layoffs happened in March of 2015, and every month brought more bad news about work prospects, oil prices, all while my co-workers were laid off bit by bit.  People I had spent 10 years with, collaborating, learning, laughing, complaining, eating, and sharing life with, usually more time with each other than we were with our families at home, who had become my work family, were suddenly gone. We all taught each other about the corners of the world from where we came and a workplace place once filled with the noise of a busy beehive full of engineers, designers, and associated support staff was quiet and still, and growing in its silence monthly.  Each time the word got out that people were being let go that day, we all fretted at our desks, wondering if our phones would be the ones to ring next.  And when the day would end, and you were one of the ones left standing, you were filled simultaneously with relief and guilt.

By January of 2016, the company was perhaps half the size we had been at the end of 2014.  I came home from work after a particularly brutal day of layoffs and told my husband I wanted to sell the house and move.  I knew my days were numbered and the prospects of finding a new job at the same salary to support our family were slim.  My degree and experience is 100% focused on engineering especially as it pertains to the world of offshore oil and gas. I knew when my day came, I’d have to reinvent myself, and the difficulty of that reinvention would be on a logarithmic scale if we remained in our current house.   Our home, like many homes in the Houston area, had only increased in value, and it would be wise to cash out our investment and put it into a smaller home with more energy efficiency.  We made the decision to let our boys finish out the school year and move that summer.  Thankfully, our home sold in a matter of days once we put it on the market, and we were able to put money into a rainy day fund, and put a large amount down on a new energy efficient home where we can pay our bills without my engineer’s salary.  At the same time, my husband accepted a new job and promotion with a new fire department, and 2016 became the year of the change for our family.  New home, new job, and miraculously, the same job for me, although my job did have decreased benefits, increased insurance premiums and a reduced salary.

In November of 2017 I finally received my pink slip, no surprise after months of charging my hours to overhead, and yet another company acquisition completed.  When I left in November, the company I had started with as employee number 26 had ballooned up to over 300 people, and was back down to less than 50 people when I left.  A few had left on their own, most had not.  People had moved all over the continent to find jobs.  Louisiana, Michigan, California, Colorado, Maryland, Canada, some had changed industries all together, and too many have been out of jobs since the downturn began.

I know beyond a doubt that I am one of the lucky ones.  While I no longer support my family at the same level I once did, I was not the sole income of our family, our family economics were always diversified, and we were not scared of both of us being laid off at the same time.  Both my husband and I are natural born American citizens, so neither one of us require a visa to work here.  His job supplies our family with medical insurance, and due to our forward thinking as the walls around me came crashing down at work, we have been able to stay afloat.  Harvey did not impact us like it did so many others in Houston, and I was able to find a part time contract job with a small engineering company in Houston that allows me to work at home and avoid having to pay for child care.  My boys and I survived our first summer ever with me as a stay at home (working) mom.  I’ve had to learn how to cook, a task my husband had always taken care of, and so far, nothing I’ve cooked has made anyone sick. I’ve been home to make sure everyone gets to practice and games on time, uniforms are clean, homework gets completed, and I now know the joy of having them crash through the front door at the end of their school day, excited to be home, which is something I’d have never known if I’d stayed as a full time working mother. Engineering in the oil and gas industry was a wonderful way for me to support our family while we were expanding, the boys were young, and childcare costs were the most expensive.  I don’t regret my days at work while my boys were babies and our family was growing.  They were well cared for while I made many friends and learned about parts of the world I didn’t understand. I spent my days surrounded by geniuses as opposed to breaking up fights over matching socks, who gets to play with what toy, and the icing on the cake. For any mother of young children the icing on the cake was the ability to exist alone in my own personal space every weekday, even if it was in a cubicle.

And now one year post layoff, after a good, though unstable career in oil and gas engineering, I’ve figured out what I want to be when I grow up.  I spent 18 years many times as the only woman in the room, and now I will surround myself with women and help support them as their Doula when they have their babies and grow their families.  A dream I would have never fulfilled and a chance I would have never taken for myself had the market never crashed.

By W. H. Luyties, editor OWOE. Recently, OWOE initiated a series of blogs to take a closer look into the key US government actions to promote fossil fuels. Since the 2016 election, one lightening rod topic has been the push to increase coal and oil production in the US. This has energized both proponents of fossil fuels, who see an opportunity to possibly save their industries (coal) or increase production (petroleum), and opponents, who fear the environmental consequences of such a change. But is this a real threat to the global move away from fossil fuels, or is it simply rhetoric to energize a political base? (more…)

A carbon tax and a carbon cap-and-trade program are fiscal policy tools that a government can implement to reduce carbon dioxide (CO2) emissions to the atmosphere (see figure) and help in the fight against climate change. (more…)

Guest blog by S. A. Shelley

Are we on the cusp of mass adaptation of Electric Vehicles (EVs) for transportation?  Probably not for at least a while longer. When doing the financial analysis comparing EVs to Internal Combustion (IC) Vehicles at the personal or family level, the comparison usually yields these results: (more…)

Guest blog by S. A. Shelley

I love the guys and gals over at Lawrence Livermore National Laboratory (LLNL). They tend to produce some of the coolest energy studies with nifty graphics (all the while hiding the space aliens from us). Earlier this year, as it does every year, LLNL published the U.S. energy flow chart which illustrates total US energy production by source and how it is consumed. (more…)

By W. H. Luyties, editor OWOE. With the election of Donald Trump as president of the US and control of all 3 branches of the government in the hands of Republicans, who have historically been strong supporters of fossil fuel interests, one lightning rod topic has been the push to increase coal and oil production in the US. This has energized both proponents of fossil fuels, who see an opportunity to possibly save their industries (coal) or increase production (petroleum), and opponents, who fear the environmental consequences of such a change. But is this a real threat to the global move away from fossil fuels, or is it simply rhetoric to energize a political base? (more…)

There is no doubt that the practice of net metering for residential solar photovoltaic systems has been a key enabler of the rapid growth of rooftop solar generation in the United States (see OWOE: How does net metering encourage private investment in home solar systems?). But has it outlived it usefulness? Or, has it even become a barrier to greater renewable penetration into the marketplace?

(more…)

Guest blog by S. A. Shelley

Revenue Trap: ” A focus on revenue at the expense of weakened strategy and reduced profits.”

Oil prices seeming to whipsaw back and forth, weekly, daily, even hourly is the result of many oil and options traders clearing trades at whatever slim profit they can eke out. Of course, multiply that slim profit by the huge volumes traded and well, Wall Street still makes a hefty profit whether oil is up or down.

Other folks are starting to talk about oil supply and demand hitting a new equilibrium, or that shale production has peaked. Fair enough. In fact, I agree that efforts to constrict oil supply are starting to have some effect. I doubt however that restricting oil supplies will be effective in the long run. OPEC claims that compliance with the production quotas is strong, but on the other hand, some OPEC members have recently vowed to opt out of the quotas and to even increase production. Don’t forget about some of the African members of OPEC who were free to pump and sell as much oil as they could. (more…)

Almost a year and a half ago OWOE blogged “What about transportation?” in which we took a brief look at the challenges facing a renewable energy transformation of the transportation industry, which accounts for approximately 30% of US energy use. In what has been a relatively short period, the answer to that question has become much clearer. Let’s take a look at what’s happened since then.

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Guest blog by S. A. Shelley Absolutely, the United States can become energy self-sufficient, but it is unlikely to become self-sufficient in oil production.

Since the end of last year and the beginning of this year, several governmental and intra- governmental bureaucracies, independent think-tanks of all sorts and large energy producing companies have issued annual energy outlooks in one form or another. I characterize them as “Business as Usual” (BP, Exxon, etc.), “Business is Changing” (Shell, Carbon Tracking Institute, etc.) and “Fanciful Delusion” (OPEC). In all forms these reports are interesting reading. (more…)