Executive Profile: George Kaiser, Kaiser-Francis Oil Co.

Executive Profile: George Kaiser, Kaiser-Francis Oil Co.

“In the charitable world as in the business world, opportunities should drive budgets, not the other way around.”

In one succinct quote, George Kaiser offers up every puzzle piece needed to understand the man and his philosophies on money, business, and philanthropy. All are inextricably linked. He’s an invisible billionaire of sorts, who swats away any ranking of himself as one of the wealthiest in the world like frivolous, disposable news. If you don’t live in his beloved birthplace of Tulsa, Okla., you may never have heard his name—and that suits Kaiser perfectly fine.

Kaiser Francis Oil Co.

Kaiser-Francis Oil Company is a Tulsa-based oil and gas exploration and production company.

www.kfoc.net

Fiercely private, Kaiser shuns publicity, never attends society functions, and hardly ever grants interviews. He doesn’t own big-bucks toys like vacation homes, exotic cars, airplanes or yachts. He wears a cheap watch and always flies coach. Kaiser’s passions instead lie equally in his businesses and charitable investments. He commits half his 70-hour work week to each, so the first can finance the other.

George Kaiser quietly owns empires in oil and gas, banking, and private equity. His father, an attorney, fled Nazi Germany in 1933 and ultimately landed in Tulsa where the family finally settled in 1940. George was born two years later. He went on to earn a Harvard MBA then joined his father and uncle at their small E&P known as Kaiser-Francis Oil Co. When his father passed in 1969, Kaiser bought out his uncle and over a short time grew Kaiser-Francis into one of the most successful upstream operators in the nation. The company currently operates in Okla., Texas, N.M., Wyo., N.D., and La.

Following the rapid growth of his oil and gas company, Kaiser in 1991 acquired Bank of Oklahoma for $60 million and a 60% ownership, launching his personal wealth into the stratosphere. He created Argonaut Private Equity in 2002, which today manages billion-dollar investments in 19 companies including those energy related. He’s also a tireless champion for education and recovery among the city’s impoverished and marginalized.

But Kaiser doesn’t believe in check-writing handouts. Through his George Kaiser Family Foundation, the now 78-year-old develops and finances ground-breaking programs and initiatives that merge every requirement to deliver meaningful results. He, along with other private investors, built the 100-acre Gathering Place in 2014—now a Tulsa icon intended to unite every socioeconomic group at a learning park uniquely created for everyone. Kaiser has invested more than $10 billion in Tulsa and its citizens, putting him third behind Warren Buffett and Bill and Melinda Gates as the largest American philanthropists. But there’s that annoying ranking again.

Several years ago Warren Buffett famously quipped to Forbes, “I’d fight for the opportunity to be president of the George Kaiser fan club.”  Somehow, we don’t think he’s alone.

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The Unsinkable, Undeterred, Uncompromising Harold Hamm

The Unsinkable, Undeterred, Uncompromising Harold Hamm

Continental Resources’ CEO Harold Hamm isn’t one to mince words or question his decisions, especially during unprecedented times for his industry. Back in 2016, the larger-than-life billionaire wildcatter was tapped by the current administration for a cabinet position to become the first U.S. energy secretary plucked directly from the oil and gas industry. Long story short, that never transpired, and Hamm returned to doing what we does best—finding oil.

Continental Resources

Continental Resources, Inc. is an American petroleum and natural gas exploration and production company based in the Continental Oil Center in Oklahoma City.

www.contres.com

 

Since his brush with political fame, Hamm has emerged as an oracle of sorts and certainly a voice to be heard for crude oil. He heavily advocated government intervention during the Saudi Arabia-Russia pissing contest. He stood along CEOs from ExxonMobil, Chevron, and Occidental Petroleum in April to meet with President Trump in an oil and gas quasi-summit to discuss the state of an industry in crisis. Later that month, after the price of crude oil nose-dived into a negative stratosphere, Hamm called for a government probe into what he believed to be market manipulation or system failure behind the price wreckage.

Most recently, and on top of calls to cut U.S. oil production as well as growing storage constraints, Continental shut-in a majority of its Bakken wells in North Dakota and Montana declaring force majeure. When you’re the largest operator in the second-largest producing basin, that’s serious news and a defiant action to adapt to an oil and gas industry such as it is. And it also adversely affects the midstream space.

Continental now has announced its 1Q earnings report that comes with a $186 million loss. A lot of money, yes, but nothing compared to the billions in losses we’re seeing from other E&Ps. The company also says it will curtail about 70% of its crude output in May—one of the most aggressive cuts in production from E&Ps right now as producers plan to halt more than 600,000 BPD this month and next. Word of the day is “patience” for midstreamers pained by curbed volumes in a tumultuous time. Let’s remember, we both need each other.

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The Money Backers:  Sam Zell

The Money Backers: Sam Zell

A salty-tongued investor nearing age 80, Chicago-based Sam Zell joins an elite flock of billionaires looking to snatch up distressed oil and gas assets and buy “the right” energy stocks at fire-sale prices. In a recent interview on CNBC, Zell proclaimed the time was ideal to both shop and invest in oil and gas in this era of industry over-leverage, painfully low commodity prices, yawning interest from the private equity world and—yes—the economic fallout from the Caronavirus.

Opportunistic? Of course. A potential lifesaver for well-managed companies that need some fresh coin to right themselves? You be the judge. But Zell and his investor peers Warren Buffet, Carl Icahn and Jerry Jones are betting that the energy sector will be one of the big winners this year.

Known primarily for his prowess in real estate (he’s been called that industry’s founding father of investments), Zell is an unapologetic bargain hunter, which has earned him a comfortable living that started even before he graduated from college with a law degree. He worked for an attorney one week, decided he hated it, and returned to investing in apartment buildings. Founding Equity Group Investments in 1968, Zell, now worth $5.6 billion, is an oft-quoted business philosopher famous for sayings like, “When everyone is going left, look right.” Forbes Magazine has dubbed him one of the “100 Greatest Living Business Minds.” Zell’s Alpine Energy Capital includes upstream and midstream assets in the Lower 48 and maintains an active drilling and development program near Giddings, Texas.

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U.S. LNG Export Leaders Hold on Tight, Move Forward in a World of Recovery

Despite—or even in spite of—a pandemic that’s ravaged oil and gas demand across the globe, the U.S. remains on course to become the largest exporter of LNG in as little as five years. True, the world’s four LNG heavyweight suppliers (Qatar, Australia, the U.S., and Russia) all have reduced shipments due to decline in demand. This “ouch” period after more than two years of record growth, especially in the U.S. According to the EIA, the U.S. hit an all-time high in January of 8.1 BCFD LNG exported just before COVID-19 slammed the industry into a cliff.

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The Operators: Genesis Energy

Since its formation in 1996, Houston-based Genesis Energy has built a powerful onshore and offshore midstream network that primarily caters to refiners. The company operates four divisions that include offshore pipeline transportation, onshore facilities and transportation, marine transportation, and sodium minerals and sulfur services.

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On the Job Front:  Viking Makes the Grade

On the Job Front: Viking Makes the Grade

Midland, Texas, in December officially became the wealthiest metropolitan area in the nation as a result of Permian oil and gas and financial services backing those who drill and snatch up homes. But that’s little comfort to oilfield professionals in the office and out in the field now searching for their next appointment in the current job environment. Fact is, 2019 has marked a tough year for E&Ps struggling with debt, lack of capital, bankruptcy, and the new normal of producing more with less. Cut-backs have led to lay-offs, which in turn have displaced hundreds of employees looking for work.

Viking Recruiting

Viking Recruiting Resources is a professional recruiting firm that specializes in the Oil & Gas Industry. Our goal is to develop relationships with both professionals and employers in order to create mutually beneficial partnerships.

vikingrecruiting.com

Summer Chancey is all too familiar with the booms, busts, and pancake-flats that define the oil and gas industry. Her father owned an oilfield services company, and an uncle, brother-in-law, nephew and now fiancé all claim a part of a business that tends to seep into your skin and stay there. As the CEO of Houston-based Viking Recruiting Resources, Chancey witnesses every day the latest changes and movements occurring in the energy environment, from the companies looking to hire to the job seekers on the hunt.

What’s the Hiring Landscape Right Now as You See It?

“I have more positions available than candidates,” Chancey says. “But our clients are hiring for permanent, long-term positions vs contract work. These folks are harder to find because they’ve been with their employer for five years or more and it takes a lot to get these candidates to make a career move. An increase in salary doesn’t cut it anymore, so companies must up their overall packages with incentives like remote or flexible schedules to offer an overall work-life balance.

“On the flip side, a majority of people looking for jobs are contract workers in search of their next one-to-two-year projects, and it’s harder to pull contract workers into permanent positions because of the pay.”

Viking currently offers 17 open positions from five companies that need to be filled by the end of January. Positions include field techs, maintenance operators, planners and schedulers. The hottest regions in play are New Mexico, Houston and Ohio. The recruiting firm looks to see an increase in hiring activity starting in January.

What Advice Would You Offer Someone Looking for a Position Right Now?

“I always say looking for a job is a full-time job,” Chancey says. “I just spoke with an employee laid off from an oilfield services provider in Oklahoma who had no idea how to find a job. He’d been with the company for 18 years and the only employer he’d ever worked for. Didn’t have a resume and no idea how to even start his search.  My first advice would be network or learn to network. Use LinkedIn and join groups on Facebook that share new jobs, job fairs, job-hiring events. The phrase “It’s who you know” holds true in our industry.

Why Should a Job Seeker Work with a Recruiter?

“Because we help you build a strategic plan to execute job searches efficiently and quickly—and that plan is finessed every week. Our most recent job candidate received a job offer within 35 days. In our case, Viking provides one-on-one service to help candidates create a professional resume and cover letter using key words for specific positions and ensure their documents can upload to a company’s Applicant Tracking System. We work with LinkedIn, Reese Midstream Report and other channels, and network with four other recruiting firms to get more eyes on each resume. We also conduct “mock” interviews before the big day to ensure our candidates are well prepared ahead of time.”

Learn more about Summer Chancey and Viking Recruiting Resources at www.VikingRecruiting.com.

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No Continental Divide for Oil Legend Harold Hamm

No Continental Divide for Oil Legend Harold Hamm

You could easily describe Harold Hamm as an oil baron, tycoon, self-made billionaire, maybe even one of the last American wildcatters. And you wouldn’t be wrong. But as fitting as those descriptions might resonate, Hamm sees himself as something entirely different—an oil finder with the heart of a geologist. His step down announced this week as CEO of Okla. City-based Continental Resources is far from the end of Hamm’s storied career as one of the most successful, prolific “oil finders” in U.S. history. The same day he turns over the reigns to the company he founded at age 21, Hamm will slip into his new role as Continental’s chairman of the board.

Contintental Resources

Continental Resources (NYSE: CLR) is a top 10 independent oil producer in the U.S. Lower 48 and a leader in America’s energy renaissance. Based in Oklahoma City, Continental is the largest leaseholder and one of the largest producers in the nation’s premier oil field, the Bakken of North Dakota and Montana. The Company also has leading positions in Oklahoma, including its SCOOP Woodford and SCOOP Springer discoveries and the STACK and Northwest Cana plays. With a focus on the exploration and production of oil, Continental has unlocked the technology and resources vital to American energy independence and our nation’s leadership in the new world oil market.

www.contres.com

You already may know Hamm’s rags-to-riches story and how he rose to become the pioneer in developing the Bakken shale play. But it’s worth a quick glimpse in the rearview to gain a full study of the man and his utterly relentless ambition. The “rags” beginning of Hamm’s life came at birth in 1945 as the 13th child to poor sharecroppers. As a child, he worked barefoot alongside his parents in the Okla., cottonfields to help his struggling family. He later would start his own business, trucking water to and from the oil patch, fully aware where help was needed to keep oil flowing, but now envisioning his own oil strike. Then, a turning point in 1971, when Hamm took out a loan to drill his first well. Continental might have been a speck-of-a-producer back then, but Hamm held grand ideas to find “the next big oilfield.”

And by golly, he did. Here’s where the “riches” part comes in.

Horizontal drilling in the 1990s had just emerged as a promising new technique to unlock crude oil from previously impenetrable rock. Hamm gambled his resources on the Bakken in N.D., and Mont., employing both horizontal drilling and hydraulic fracturing at a time when other producers there hadn’t yet caught on. And guess what? The gushers not only came but kept coming, launching Hamm’s Continental success into the stratosphere and anointing him a multi-billionaire in the process.

Today, from his home state, Harold Hamm and Continental remain one of the largest producers in the Bakken and Okla.’s SCOOP/STACK play. During 3Q, the company reported a 20% increase in oil production over the same period last year. While Continental has taken its own beating in the stock market, the company’s track record of capital discipline and building upon its proven hot spots continues unfettered and undeterred. Oil veteran William Berry, a previous ConocoPhillips exec and Continental board member will assume the role of CEO effective Jan. 1. And as for Hamm now taking a back seat to the operations at Continental? Don’t be fooled. This is his baby, and he’s not going anywhere.

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