1

PETROLEUM EQUIPMENT SUPPLIERS ASSOCIATION 2012 ANNUAL REPORT

We are jobs. We are technology. We are stability.

C O N T E N T S 2 4 11 12 15 16 19 20 26 36 37 38 40 42 50 Chairmans Letter Presidents Letter Annual Meeting Washington Fly-In Energy Educators Emerging Leaders FSO Foreign Service Officer Training CID Credit Interchange Division Year in Review Executive Committee Committee Chairmen Financials Board of Directors Member Companies Past Chairmen

We are well over 500,000 working men and women. We are the holders of tens of thousands of patents. We are reversing Americas energy decline at a record pace. We employ men and women in every state at double the mean U.S. income. We rewrite whats possible: We make the technology that brings energy from the bottom of the sea and from solid rock. We are the primer for the American economic engine: We make 100 years of affordable energy possible, which drives Americas manufacturing renaissance.

C H A I R M A N S

L E T T E R

The oil and gas business is at an unusual juncture in our long history. Business is goodoil prices are stable, were faster and more efficient than ever in solving subsurface engineering problems, and our industry now has a decades-long inventory of known, productive drilling locations here in the U.S.
Ten years ago, wed call this a boom cycle, sit back, and enjoy the ride. Yet today, despite our success, we find ourselves in a precarious situation.

To put it mildly, the oil and gas industry has a public relations problem which, gone unchecked, could cost us our ability to operate. Even more importantly, it could undermine our countrys economic growth and stability. I believe that people outside of our industry have a tremendous misunderstanding of what we do. Our industry is viewed as part of a problem, not part of a solution. PESA, like many of our sister organizations, has made education of our stakeholders paramount. We have a great story to tell and it must be told to the public and to our government representativesand we believe we can do so by highlighting three key principles. Jobs The recession wreaked havoc on the U.S. economy and job market, losing more than 2.5 million jobs between 2005 and 2008. Virtually every industry in the nation contracted and shed workers in that period, but not the oil and gas industry. According to a survey compiled from government data, a conservative estimate of oil and gas job growth over the past five years is 30 percent. And these are not just any jobsthese are great jobs. I dont believe there is an industry out there where a high school or college graduate can earn a better living. The average annual wage for all U.S. jobs in 2011 was $47,000. For oil and gas workers, its more than $98,000. If youre willing to work hard, you can provide well for yourself and your family, and more importantly, you can take pride in what you do. PESA member companies alone provide well more than 500,000 of these great jobs. While many outside the industry assume that oil and gas jobs only exist in Texas, Oklahoma, and Louisiana, the reality is that our industry provides jobs in all 50 states. In California, oil and gas provides nearly 74,000 direct jobs at an average salary of more than $121,000. In the past decade, Pennsylvanias oil and gas jobs have risen by 84 percent, now ranking sixth in the nation, while Colorado has added more than 15,000 oil and gas jobs. And we do all of this without significant special tax breaks and incentivesour independent producers simply need the ability to deduct the cost of intangible services. One of the biggest myths is that the oil and gas industry pays virtually nothing in income taxes. The truth is that the oil and gas industry provides more revenue dollars to the Federal coffers than any other source other than income taxes. If there is one message that should resonate as our nation continues its economic recovery, its that our industry is a creator of many thousands of jobs at a wage far higher than the national average.

Technology
From geoscience developments to well construction, our industry is on the cutting edge of creating solutions. It has been said that we dont have a shortage of petroleum resources in the worldit is just a matter of time until we figure out how to produce and develop it. While shale has always been recognized as source rock for hydrocarbons, direct production from and development of shale is still in its infancy.

For those of us working in the industry, technology is a way of life. Weve seen it every day of our careers and were used to it. But if you step back and look at what were able to do from an outsiders perspective, our industry is nothing short of a technological marvel. We float rigs the size of a large building in the middle of the Gulf of Mexico, drop a mile or more before we touch the seabed, and then drill two to three miles further and hit a target within inches. On land, from a single pad, we can drill multiple wells more than a mile down, and then a mile or two horizontally in any direction, developing reserves from an area miles in diameter from a surface footprint smaller than a football field. Downhole technology provides real-time well characteristics, allowing us to alter the path of a drill bit through the reservoir to optimize production. The idea of dumb iron in the oilfield is a relic. The science and technology necessary to provide the nation with energy to power our economic growth is something to be celebrated. Stability While the oil and gas business will always be cyclical, true energy stability and security is now on the horizon. Ten years ago, billions of dollars were invested in importation infrastructure to supply the U.S. with natural gas from other countries; now we have a 100-year domestic supply. For decades, U.S. oil production declined with no relief in sight; between 2008 and 2011, we added 1.4 million barrels per day of domestic supply. In 2012 alone, the industry increased domestic hydrocarbon supply by 7 percent, producing 10.9 million barrels per day, which represents the greatest year-over-year gain for the U.S. since 1951. The U.S. Energy Department expects further growth to 11.4 million barrels per day next year. The consequences of the industrys success are staggeringwere on track to reduce energy imports from less-than-friendly nations for the seventh year in a row, which will impact our nations foreign policy and geopolitical standing. Some experts have said that energy independence could be possible for the U.S., something that hasnt happened since the industrialization of our country. There are more immediate effects to the industrys new-found energy abundancea renaissance in American manufacturing. The increased availability, stability, and affordability of natural gas have brought about the greatest changes seen in more than 40 years. Many heavy manufacturers such as the steel industry have slowly switched from coal as a primary power source to natural gas. The resultant savings have preserved U.S. jobs and are making U.S. companies more competitive on the global market. Whether or not true energy independence is an attainable goal, at the very least, our industry has created a much brighter future for our country. As youll read in these pages, PESA is indeed in great shape and we had nothing short of an outstanding year. But we can no longer take it for granted that our industry and therefore our Association will be viewed as part of Americas solution. Our story of jobs, technology, and stability must be told. We must educate our elected officials at the city, state, and federal levels. We must educate friends, families and foes alike as to what our industry means to each and every citizen of our country. We all have a responsibility here, so please visit your neighbors and your elected officials and explain the positive impact you, your company, and your industry have on our nations energy and economic prosperity. Chris Cragg PESA Chairman Senior Vice President, Operations Oil States International, Inc.

P R E S I D E N T S

L E T T E R

Twenty-twelve was a defining year for PESA. Chris Cragg and the other members of the Executive Committee set goals of furthering our members interests by making America more aware of the jobs our industry supports, the technology we provide, and the economic gains and stability we make possible.
Education has for years been an important facet of PESAs mission. The Government Relations Committee for the last 20 years has co-sponsored a week-long training session here in Houston with the U.S. Department of State. Participants come from embassies around the world and from agencies in Washington, D.C., to learn more about the oil and gas industry. With all of the cost-cutting measures that have been put in place recentlyespecially on oil and gas related programsit was no surprise that we were told last summer that there were no funds to support the training. The surprise came when a number of the previous participants petitioned the leadership at the Foreign Service Institute to re-instate the training because it had been invaluable to them during their careers. One of the other issues on the horizon involving education is the time when our member companies will find it impossible to meet their demand for highly skilled personnel. Enter the Petroleum Academies in Houston and Ft. Worth. Five years ago, Doris Richardson (IPAA) came up with an idea which would allow the various segments of the oil and gas industry to work together with the Houston Independent School District to produce something extraordinary. That extraordinary idea has taken shape in the form of Petroleum Academies at Milby and Westside High Schools, along with the Young Womens College Preparatory Academy in Houston and more recently at the Southwest Academy in Ft. Worth. PESA and its members have been involved with the academies from the outset. Our members have been guest lecturers, have funded teacher training, have hosted externs during summer months, and have provided scholarships to many of the outstanding academy graduates. Then in 2012, IPAAs Barry Russell and PESAs Chris Cragg and Galen Cobb collaborated to bring forward the idea that PESA should join with IPAA in sponsorship of the academies. This partnership was such a wonderful, natural progression for our association and its goal of supporting education. Additionally, it has given us another perspective on education. We have a chance to not only communicate with the general public but also have a great opportunity to reach the young people of today who will become the energy leaders of tomorrow. I am so proud of the enthusiasm and support that our PESA members have shown in working with the academy students. And these students respond with a real dedication to the goals they set for themselves. I invite all of our members to become more involved. Plan to have an extern at your company this coming summer, volunteer to be a guest speaker, or attend one of our extern banquets. One of our members attempted to describe how good it feels to help out and watch these students succeed. He finally held his hands out, palms up and said, You would have had to have been there. Please join us in our continued efforts to be there for these outstanding students. In closing, the PESA staff and I want to express our gratitude to all PESA members for the opportunity you give us to work with you throughout the year. Best regards, Sherry Stephens Blanks PESA President

A year of jobs, technology and stability.

W e

A r e

J o b s

With factories dormant for decades and commercial properties long in disuse, manufacturing is finally returning to the Rust Belt. Spurred by the boom in cheap domestic energy, Americas traditional manufacturing center is re-awakening, bringing with it sorely needed jobs. Among the largest investments underway in the area is V&M Stars new Youngstown, Ohio, pipe rolling facility. With a capacity of more than 500,000 metric tons of pipe per year, the plant is a symbol of the countrys new energy base, manufacturing oilfield equipment near its end use sites in the Utica and Marcellus shale formations, among others. Were proud of our ability to bring jobs back into the Ohio area and be a part of the renaissance of Ohio manufacturing, says Doug Polk, Vice President - Industry Affairs for V&M USA. We have an existing mill there and were able to grow upon the talent and dedication of those employees theyve been good to us, and now were giving back. The one-million square-foot pipe rolling facility began producing premium casing in late 2012. It will create 350 jobs, while another expansion for a pipe threading facility with create a further 125 jobs.

Doug Polk
Vice President - Industry Affairs (V&M USA)

Johan Pfeiffer
Vice President of Surface Technologies (FMC Technologies, Inc.)

W e

A r e

J o b s

FMC Technologies, Inc., like many PESA member companies, is caught in the best of self-fulfilling prophecies. Technology creates affordable energy, affordable energy grows the U.S. economy, and a growing economy creates more jobs, and more jobs develop the technology further. As the company name implies, they specialize in oilfield technologycutting edge advancements that not only allow for the economic production of shale reserves on land and from the deepest subsea wells, but create thousands of jobs. In 2012 alone, FMC Technologies, Inc. added about 4,000 employees to reach a total of more than 18,000. Johan Pfeiffer, Vice President of Surface Technologies, says that his group at FMC Technologies, Inc. has closely followed the explosive growth in shale production and operates in every shale basin in the U.S. Be it in North Dakota, Pennsylvania, or West Texas, when Pfeiffers group comes to town, they bring jobs. The company has opened many new facilities in the past three yearssometimes they bring 10 jobs, sometimes 50, and sometimes more. Weve seen strong growth all over the U.S. and in subsea. Just in the Houston area, we expect to dramatically increase our number of employeesall will be new hiresin the coming years.

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Amy Myers Jaffe

(Rice University)

Chris Cragg
(Oil States International. Inc.)

Mike Kowalski
(Sunbelt Steel)

Cindy Taylor
(Oil States International, Inc.)

Lew Watts
(Regester Larkin Americas)

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A N N U A L

M E E T I N G

Monumental changes are occurring at a pace never before imagined. But unlike any other time in the history of the oil and gas industry, technology is not the only solution to the challenges ahead. Looking forward, the industry can think of oil and gas production as a three-legged stooltechnology, economics, and politicsany of which can dramatically affect the other two.

Those new realitiesand how to manage a business through itwas the theme for the 2012 Annual Meeting.

The keynote speaker for the event was Rice Universitys Amy Myers Jaffe. She says that global oil and gas production is at a transformative time, both geopolitically and technically. My view of oil price is that the problem is above groundits geopolitical. The price started going up when unrest began in Egypt; when it spread to Libya, it went higher still. Meanwhile, U.S. shale is going to be transformational in terms of geopolitics, industry infrastructure, and the industrys need to respond to stakeholders. A three-person panel discussed the domestic challenges of oil and gas. Marshall Adkins, Director of Energy Research for Raymond James & Associates, says that the peak highs of oil prices and deep lows of natural gas prices are coming to a close as the markets begin to rebalance themselves. Natural gas prices will be lower for longer, but were near bottom. The surprising thing at the moment is the pace at which U.S. oil production is reversing itselfit now means were in a range bound world for oil prices between $60 and $100. Mark Papa, Chairman and CEO of EOG Resources, says that EOG expects to take 1.6 billion barrels of oil from the Eagle Ford shale over the next 25 to 30 years, but hes far from happy. Using current technology, we expect to produce only about 6 percent of the oil in place, but what that also means is that were going to leave 27 billion barrels of oil in place under our acreage. And David Welch, President and CEO of Stone Energy, says that the Gulf of Mexico has been and will continue to be a testbed for offshore technology. If you look at the geology of the Gulf, you can see how different levels of source rock deposition have created greater and greater opportunities for us. Were not at the bottom of it yet, given the technology that enables us to drill very deep wells. A second three-person panel discussed the challenges of production internationally. Lew Watts, Chairman of Regester Larkin Americas, says that a global replication of the U.S. shale boom is not as simple as once thought. In China, they recently reduced their shale estimates to 886 Tcf from 1275 Tcf. This is an example of what happens when people start to look at shalethe optimism quickly goes away. John Surma, Chairman and CEO of U.S. Steel Corporation, says that the increased availability, stability, and affordability of natural gas has brought about the greatest changes seen in more than 40 years in the steel industry. Reducing our costs by $15 per ton doesnt happen to us very often. Usually, we kick and scratch for a year to come up with 50 cents a tonthis is what shale technology has done for us. And finally, Cindy Taylor, President & CEO, Oil States International, Inc., says that increased costs and geopolitical risks are leading many major oil companies and NOCs to seek safer havens of opportunity. While we enjoy spending money in the U.S. and creating jobs in our home country, we follow our customers and their investments. Geopolitical risk is leading them, and therefore leading us, to areas like the Canadian oil sands, Australia, and deepwater projects.

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W A S H I N G T O N

F LY - I N

They heard it from U.S. Representatives, Senators, Congressional Staffers, and from PESAs sister associations: the single most important action one can take in the political process is to take your story to Washington, D.C.

Twenty-seven member company executives and PESA staff spent two days in Washington, D.C. telling the PESA story of jobs, technology, and stability during the Associations third Fly-In. The group met with 22 members of Congress and/or their staffers, along with 10 industry groups, Washington-based customer representatives, Administration representatives, and members of the U.S. Department of State.

Sen. David Vitter (LA), Ranking Member on the Senate Committee on the Environment and Public Works, says the story that PESA should repeat over and over is jobs. Communicate the jobs impact of what you dothats the big story, thats what the average American cares about, and because of that, its what the average member of Congress cares about, says Vitter. Because of the newly discovered energy resources we have in this country, were sitting on a game changer for our economy. In addition to jobs, the most often discussed topic were the sequestration, Keystone pipeline, access on public lands, exports of oil and gas, and taxation. Rep. Doc Hastings (WA), Chairman of the House Natural Resources Committee, has jurisdiction over most public lands in the West as well as the outer continental shelf. He says that its in every Americans interest to have productive public lands, which can provide a reduced reliance on foreign energy and fuel jobs for the economy. That was the focus of our Committee in the last Congress, and frankly it will be the same in this Congress, says Hastings. We want to look at all of our public lands and expedite the process of permittingwe passed that bill in the last Congress but it went nowhere in the Senate. The bottom line is that weve reached a point in this country where the slow down on energy development is happening more and more on public lands, and principally on federal lands. Rep. Fred Upton (MI), Chairman of the House Energy and Commerce Committee, says that oil and gas exports are a good opportunity for the country, and that the Keystone pipeline is an answer for simple supply and demand. Im a big supporter of drilling in Alaska and the Keystone pipelineone refinery in my home state has undergone $3 billion in upgrades to refine oil sands, and a large refinery in Gary, Indiana, has done the samethose investments are in jeopardy. Why would we turn our backs on our friends (Canada), when they can just divert their product somewhere else? Exports are in our best interest, Upton continued. After Fukushima, how can we tell Japan that because of the sanctions we placed on Iran, they cant import from there and we cant export to them either? How are they supposed to survive? The DOE even helped with our argument when they said that the price would likely rise by about only 50 cents. It just makes sense.

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19

20

16

17

18

19

20

16

17

18

19

20

16

17

18

19

20

16

Stephen Flaherty
19b

24

ELLI

JOTUN JOTUN E.

GRYPHON
18c 18b

24/8-3 MACLURE
19a

17b

25

FR IG G

30

(Weir Oil & Gas)

22

25

21

HARDING 24a 23d

RINGHORNE RINGHORNE 25/8-4

23

24

25

21

22

23

24

21

22

23

24

(New Mexico)
25

22

23

26

24

25

21

22

(Halliburton)
24d
22b
23b

BALDER BALDER BALDER BALDER BALDER BALDER BALDER

GRANE

24c

DEVENICK
24b

155
5
1
2

27

23

24

25

21

22

23

24

25

21

22

23

24

25

21a

21b

22a

23a

28

29

30

26

27

CRAWFORD
28
29
30
26

24/12-3

25/11-16

156
3
4
5

27

201
2
3

28

29

30

26

11
2
3

27

28

Orkney Islands
29
28

29a
29
30
26

HANZ

12
2
3

13
5
1

27

28

29

30

14
2

26

27

28

29

30

26

15

27

28

29

30

16
1b
1a 6c

26

27

28a 28b BRAEMAR 3c

29b

15
GUDRUN

16

VERDANDI

17

2c 2b

E.BRAE
3a 3b

10

Flotta
8
9
10

2d

2a
BEINN

3d 8c

15/3-4

W.BRAE 6a
9
10
6
7
8

KINGFISHER
8a

10

MILLER
7
8
9
6

8d
8e

GLITNE

15

11

10

12

13

SA GE

14

15

Piper

10

10

10

6b

7a

BRAE 7b

7c 8b

11

12

- Flotta
14a

13b

ENOCH 15/5-2
11a
LARCH

13a

13

14

15

11

12

13

14

15

13c

BIRCH

DAGNY
13e 13b

14

15

20

11

12

13

16

14 19a

Mil ler

11

12

13

12b SYCAMORE

15

11 16b

12

17

13

14

15

11

12

13 18c

14b

18

19
16a

17a
19c
20a
18b

19a 19c CLAYMORE 19N 18a 19S

15 20a

11

12a 12b

13a

14 19b 19d 18d 19a

15

11b

12a
TIFFANY 17a 17c

20c

20e

16d

15/13-2
PIPER
17S 17N 16e

17a

16/7-7 SLEIPNER W. VOLVE LOKE

17c

18c 18b

TONI
20d 20b 20a

SCAPA HIGHLANDER
20b
DUART

16f 16a

16b

SALTIRE IONA
CHANTER

Norwegian Waters

20

TARTAN
17b

LOCHRANZA
16 20c

16b

THELMA
17b
18b

ALPHA

SLEIPNER E.

17b

18

21

19b

20b

16a 21d
21a

17

22

18 23c

19

20

16

17

CAPTAIN
22a

LYBSTER
Beatrice

21b

22d

24c

24a
25a

23b
24b BLAKE

23

24

25b 25c

21c JACKY 25a 21a 26a

SEA2
23

18f

19b

20d PETRONELLA 16c

18a 23a

19c

20f

DONAN

18a

25a

21c 21g 21a

23c

MACCULLOCH
24b
25c

BLADON BLENHEIM

GUNGNE SIGYN
24a KINNOULL

SCOTT TELFORD

GALLEY

23g 23b 23e

NICOL
25a

21e 23b 21b BURGHLEY BALMORAL

22

23

24b

25b

26c BEATRICE

Moray Firth

21b 21c

22b

22c

23a

24a 23d 29b 29d

25 30c

21

22

24

25b

HAMISH 21b 21d ROB ROY IVANHOE 22 21e 21f

23d 24a
29e

24c

25f 30b

BRENDA 21d STIRLING 25b BLAIR BEAULY 22 21c 25h 21a 25e GLAMIS
26c
26b

23a

24c 24b
29b 29e MAUREEN

BR

FARRAGON

28a 28c

30a Beatrice Demonstrator Site

27a

28d 28a ROSS 28c 29a

30a

26c

26b

27b 29b

28a
26a

CALEDONIA BRITANNIA

CYRUS

26

27

28b

17
1
2
3

29b 29a
4a

30b

4b

18
5
1

26b

26a

CROMARTY
27c
28b
29c

RENEE
30a 29e 30c 30b 5c HANNAY 5f 5g 5h 5b
5e 26b

28b RUBIE

29a 29c 29d 29b

29a
27a
27c

29d 29c

VARG REV
15/12-8

27

28

29

30

19
1 6

26b

30d 30b

ATLANTIC 26a

27a 2b

28a 3d

28b 3b29a

GOLDENEYE
4b

4c

20
2
3
4

21
1a 1b

26c ROCHELLE 27

ALBA
28c 3f 3e 3b BRODGAR 3a

ANDREW
28

MOIRA MARIA
29f 4c
29g HAWKINS

TWEEDSMUIR

CALLANISH
4a

30a 5a 5c

26a 1b

27b 27a

1d TWEEDSMUIR S.

22
1a
6b

CHESTNUT 2d
2a
3c

6/3-1 SEYMOUR 4a FLEMING

DRAKE 5a 5b

23
6

4d

ETTRICK
3a 2c 2a BLACKBIRD 3f

5a

BUCHAN

2a

4c

2b SHELLEY
3c 8b
4b
5b

3b 4b
5c 5d

5b

5a

1 BUZZARD

3c

4a

5d

1c

2b

2c

3a

10

Nigg

T
6
7
8
9

10a

10

GE SA
6

6a

nn Brita
7

ia

8a

10b

BACCHUS
6e
6c

8b

9a

7b

6b

9a
9b

FORTIES
10a 10c

EVEREST
6f 6S

10

10b

6b

8b

9b

10

6a

7b

7a

8a

8c

MAULE 6a 6d

BRIMMOND
7a
8a

9b 9a 14e 14a HUNTINGTON 14c 14b

10a

10b 15c

NELSON
11a

11

12

St Fergus
13
11

T
12
13
14

SEA2 ext
15
11
12
13

Forties
15a
12b

HOWE
12c

13c 12c 13a

14a
15b

BARDOLINO

12e 13a

12a

15a

11b 11c

DAUNTLESS
14

Fulmar

15b

11

DURWARD

14b 13b 12a 12d GOOSANDER KITTIWAKE GROUSE 17a 18a

15a

11b 20f

12b 17b

13b 13c

14d

15b

11a 16b 16c 16e

7/7-2

MONTROSE
17N
18n

18c

18b

19b

GADWALL

Cruden Bay
16

T
17
18
19

17c

MALLARD

20b 20c 20d 20a 20e

17S

16d

ARBROATH
CARNOUSTIE

19c 19a
20b

WOOD

MUNGO MONAN
20a 25b
16a 20c 16g 16f

COOK

20

16

17

18

19

20

16

17b

18b

19

16
GANNET D

17a
22a

18

17

23c

PICT
23b

TEAL
24b

21a

BRECHIN ARKWRIGHT
23d 23a

MIRREN
24a
25f 24c

25d

LOMOND 22c

22d 22e

7/8-3

Aberdeen
25

SAXON
23a

CLAPHAM
24a

TEAL S.

GANNET G

21c

25e
22b 22a

MARNOCK-SKUA
23c

24b 24e

24f

21

22

23

Aberdeen

24

25

21

22

23

24

25

21

22

23d 27b

28c 28a 28d

21b 25b 25c 25a 24c GUILLEMOT 29b 26a COMPLEX GANNET C 30b 30a 29a 26d 30e

GANNET B

GANNET A

22b

22c

23e 23b 28d MADOES 28a

21 25a 25c 30a MERGANSER HERON 30f30g SCOTER 26d 26c

EGRET
24d 29a

PIERCE
MIME

27a

ULA

GANNET E
29d 29c

GANNET F
30d
26c

30c

30e

MACHAR
26e

26a

COD

27a

27d 2a

27b 27a
BANFF

30

25 26
1

26

27

28

29

30

26

27

27

28

29

30

28
1

26

27c

28b

30f

26b

28b 2g

29c

29b 30c 5b 5c 5d 4a

30d SHEARWATER ERSKINE 26f 26b 30b

27b 2b
1d 1g 1b 2a

29
1c 1d 1e 6a

GLENELG
4d

ELGIN

2a

2e
KYLE 2c 2h

STARLING 2b 3a

30
1a 1f 1c

1e 1h

1
3c

TAMBAR

1/3-8

31
2GYDA

2/2-2

BLANE
2d 3a 2e 3b

BITTERN
1b 1a

4b
3b

2/2-5

2b

5 10c

2f

2d

3c 8a

4c 4e 9c

5a 10c

JADE 2c
6c

7b 12c

2013 Washington D.C. Fly-In participants

8
9
10

SEA5
6

10b

10a

JASMINE

7b

CURLEW

7a
10
6

CURLEW C
8b

6a

JUDY
7a JOANNE 12a 12d

TOR NW.
8

10

9a 9b

10a

6b

7c

9a

10d

6b

TOR
13b

ALBUSKJELL
14c
TOR SE.

11a

15a

11b

12e 13a

FLYNDRE

EKOFISK W.

EKOFISK

HALLEY
12

13

14

Inch Cape

15

11

12

13

14

15

11

12

13

14

15

11

12

13

14

15

11

12

13

14

15b

20b

11c

18c 16e 16d LEVEN 17b CLYDE AUK N.16g 18a MEDWIN

16f FULMAR

16S

12b

12c

13c

14a 14b

TOMMELITEN GAMMA

EDDA

Firth of Forth
17

NETHAN 16N 16t 16c JANICE 16b AUK 17a 16a

16

ORION

19a

AFFLECK

TOMMELITEN ALPHA
20a

ELDFISK 2/7-11

18

19

20

16

22

17

18

19

20

16

17

18

19

20

16

17

18

19

20

17

18

19

20a

16h

17c

JAMES 17d

18b

19b

20b

2/7-31 2/7-29 2/7-22 2/7-2

EMBLA
VALHALL

24a INNES

25b 25a
24c 25c
21

Neart na Gaoithe

HOD

HO

Methil

22

23

24

25

21

27

22

23

24

25

21

22

23

24

25

21

22

23

24

25

21

22

23

24

25

21

22

23

24b

ANGUS

FLORA

5603
27 FIFE 1a 2a

30a

contained within 3 Closing Lines

Grangemouth

26a

27

28

29

33
3
4

30

26

34
5

27

28

29

30

26

27

28

29

30

26

35
2
3
4

36

27

28

29

30b

26b

37

27

28

29

30

26

27

28

29

30

26

38
1

39
1b

FERGUS

D W 55

y
2

2b

LANGEL ED

CA TS

E IP RP NO
10

10a

6a

A
7

10

10

10

10b

6b

10

13

SEAL

14

15

Kintyre

12

13

14

15

11

12

13

14

15

11

12

13

14

15

11

12

13

14

15

11

12

13

14

15

11

12

18

19

20

16

23

24
25
17
18 18
23 19

SEA3
20
16
17

17
17

18

19

20

16

17

18

19

20

16

17

18

19

20

16

18

19

20

16

21

22

23
Dogger Bank

30

26

23

28 24 29

25

21

22

23

24

25

21

22

23

24

25

21

22

23

24

25

21

22

23

24

25

21

27

111
2
3

28

Blyth complex
29
29

IP SN
4

28

T
Jarrow

29

40

30

26

41

27

28

29

30

26

42

27

28

29

30

26

43

27

28

29

30

26

27

28

30

26

44
4a
1

45
E
1

112
T
11

4
4
5

4b

Belfast

7 12

8
9

Wigtown Bay
10
6

Robin Rigg (E) SOL Robin Rigg (W) OERL Solway Firth
8b
9

10

10

8a

9b

9a

10

FORBES

10

7 12b

Teesside
13
14
14
15

13c

15

11

12 17

13
20 11

113

T
Teesside Gas
12
15
11
12

14a
Southernmost Rough

ESMOND
13a 13b

14b

15b 15c 15a GORDON

11b 11c

12a 13a
13

11a

14

15

11

12b

13b

14b

15

11

12

14a

12a

13

14

15

HAWKSLEY

TYNE N.

D/12-5

E Dunkirk - Draupner E

10

10

14

Galen Cobb

Pat Bond
(Light Tower Rentals)

(Halliburton)

Foster High School Team 1

(won the 2nd Annual Energy Quest)

Energy Quest team medals

15

E N E R G Y

E D U C A T O R S

The Energy Educators committee is charging ahead with a single ideato become a leading source of education for and about the oil and gas industry.

The group strongly focuses on the IPAA-PESA Energy Academies providing guest lecturers, scholarships, and even giving a first taste of the industry itself through a summer extern program. This summer, dozens of student externs participated from HISDs Milby, Westside, and Lamar High Schools, and from Fort Worths Southwest High School. The students spent three weeks with industry companies, attending executive meetings, testing equipment, learning technology, and getting a sense of the industry. Raymond Yu externed at FMC Technologies, Inc. and said the experience was a once-ina-lifetime opportunity. I liked working at FMC because they see us as equals, not just high school students, he says. We went through new hire training and worked with people that have far more experience than we have, and they would never talk down to us. I want to come back. The feeling is mutual, according to one of Yus mentors, Johan Pfeiffer, Vice President of Surface Technologies for FMC Technologies, Inc. Im impressed by these students. Our industry is looking for a lot of talent and I hope that not only you come back to our industryI would prefer FMCbut also that you encourage your friends to do the same, he says. Im excited to see that youre excited, because that means we have a chance to fill the gap. So thank you for participating in the program, because its not only important for you but its also very important for us. Upon completion of the program PESA hosted an awards gala for the students and their families in Houston. Each student received a certificate of completion and a $1,000 scholarship from the companies where they worked. In addition to serving as emcee at both Energy Academy banquets, Energy Educators Chairman Pat Bond (Light Tower Rentals) served as co-emcee and question master for the second Energy Quest competition. More than 200 students from 14 schools competed in the event, which pits teams against one another in knowledge of energy issues. Foster High School Team 1 finished first. The committee also gave the fourth annual award for teachers in the IPAA energy academies. The awarddubbed the PESATeacher of the Year Awardis given to an energy academy teacher who exemplifies excellence in the classroom. The award carries a $10,000 stipend, distributed to the teacher and his or her school. Jessica Prado, Southwest High School, will receive the award at the IPAA annual meeting. Finally, the committee hosted its second annual Energy Educators Sporting Clays Tournament to raise funds for PESAs education programs, which include the events above as well as providing scholarships, hosting Mobile Offshore Learning Units at local schools, and more.

16

E M E R G I N G

L E A D E R S

Six years ago, the Emerging Leaders Committee began with the idea of bridging the generation gap in the industrytoday, its one of the most active committees in PESA. In the 2012 fiscal year, the group attracted more than 900 members at four events.

The committee held two sessions of the highly popular Oil 101. The course features experts from member companies outlaying the drilling process from geology to end-oflife reservoir issues. Speakers for the events included:

Karl Appleton, Business Development, E&P Operations, National Oilwell Varco Chris Doss, Technical Professional, Downstream, Mustang Engineering James Geary, Geologist, Hess Corporation Collin Gerry, Associate Analyst, Raymond James & Associates Wes Heiskell, President & CEO, Viking Oil Tools Miguel Hernandez, Project Development Manager, Shell Projects, FMC Technologies, Inc. B.P. Huddleston, Chairman, Huddleston & Co., Inc. Steve Jacobs, Chief Marketing Officer, Decision Strategies, Inc. Mark Teel, Client Relations & Technical Communications Manager, Schlumberger Beth Ullom, Sr. Technical Specialist, Enercon Jim Wicklund, Managing Director, Oilfield Equity Research, Credit Suisse Tom Yost, Business and Technology Director, E&P Operations, National Oilwell Varco

Next, the group hosted two sessions of its Executive Address Series featuring Chris Cragg, Senior Vice President for Operations, Oil States International, Inc., and Wade Phillips, Defensive Coordinator of the Houston Texans. Cragg delivered a David Letterman-style Top 10 list for success in the oil and gas industry. Among his list was number 9: Do your current job well. Many of the Emerging Leaders in PESA members companies are part of Generation X, are typically less committed to a single employer and are very willing to change jobs to get ahead. Ive seen people that are always looking for the next big job when, in fact, that yearning and ambition created a distraction that kept them from doing their current job well. Finally, for the first time in nine sessions of the Executive Address Series, a non-industry manager shared leadership lessons. Wade Phillips says that leadership is a constant subject in football, and among the greatest was his father, Bum Phillips. He told a story in which Earl Campbell reported to camp, and failed to finish a one mile run. The media, expecting some sort of punishment, immediately asked Bum Phillips what would be done with Campbell. The coachs response was endemic of his leadership stylecasual and effacing. Well, Bum says, if its third down and a mile, we wont give it to himbut well give it to him the rest of the time. `To be a leader you dont have to have a good attitude, you have to have a great attitude.

! ! !

Basin
!

17

! !

! ! ! !

Palo Pinto
! ! ! ! ! ! ! ! ! ! ! !! ! ! !! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! !

! !! ! !! ! !! !

! John !Gremp ! !

(FMC Technologies, Inc) !

! ! ! ! !! !!! ! !! !! ! !! ! ! ! !

! ! ! ! ! ! ! !

Erath

! ! ! ! !

! ! ! ! ! !! ! ! !! ! ! ! ! !!! !! ! ! ! !! ! !! ! !! ! ! ! ! ! !! !! ! ! ! ! ! ! ! ! ! ! ! ! !!! ! !! !! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! !! ! !! !! ! ! ! !! ! ! ! ! ! ! ! !! ! ! ! ! ! !! ! ! !! ! ! ! ! !! ! ! ! ! ! ! ! !! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! !! !! !! ! ! !! ! ! !! ! ! ! ! ! ! !! ! ! ! ! ! !! !!! ! ! ! ! ! !!!! ! ! !! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! !! ! !! ! ! ! ! ! ! ! !! ! ! ! !! ! !! ! ! ! ! ! ! ! !! ! ! ! ! !! ! ! ! ! ! !! ! ! !! ! ! ! ! ! ! ! !!! !! ! ! !! !! ! ! ! ! ! !! ! ! ! !!!! !! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! !! ! ! ! ! ! !!!! !!! ! ! ! ! !! !! ! !! ! ! !! ! ! ! !! ! !! ! ! ! ! ! ! ! ! ! !! ! ! ! !!! ! !! ! ! !! !! ! ! ! ! ! !! ! ! !! ! ! ! !! !! ! ! ! ! ! !! ! ! !! ! !!! ! !!!! !! ! !! ! ! ! !! !! !! ! ! ! !! !!!! ! !!! ! ! ! ! ! !!! ! ! ! ! ! !! ! !! ! !! !! ! !! !! ! ! ! !!! ! ! ! ! ! ! !! ! ! ! ! !! ! !! ! !! ! ! !!! ! ! !! ! ! !!! ! ! ! !!! ! !! ! !!!!! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! !!!!! ! ! ! !! !! ! !! ! !! ! ! !! ! ! ! !! 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! ! ! ! !! !! ! ! ! ! !! ! ! ! ! ! ! ! !! ! !! !!! ! ! ! ! ! ! ! ! ! ! !! ! ! !! ! !! ! !! !! ! ! ! !! !!!! !! ! ! !! ! ! ! ! ! ! ! ! !! ! !!! !! ! !! !! ! ! ! ! ! ! ! ! !! ! !! !! !! !!! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! !! !! ! ! ! ! ! ! ! !! !! !! ! ! ! !! ! !! !! ! ! ! !!!!!! ! !!! !!!!! !! !! ! !!! !! !! ! !! ! ! ! ! !!! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! !! ! ! !! ! ! !! ! ! ! ! !! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! !!!! ! ! ! !! ! ! ! !! ! ! !! ! ! !! ! ! ! ! !! ! ! !! ! ! ! ! ! ! !! ! ! ! ! !!!! ! ! !! ! ! ! ! !! ! ! ! !! ! ! !! !! ! ! ! ! ! !! ! ! ! !! !! ! ! !! ! ! !! ! !! ! ! ! ! ! !! ! !! ! !! ! ! !!! ! ! !! ! !!!! ! !!! ! !! ! ! ! ! ! ! ! ! ! !! !! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! !! ! !! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! !! ! ! ! ! ! ! !! !! !! ! ! ! ! ! ! !! !! ! ! !! !! ! ! !!! ! ! !! !! ! ! !! ! !! !! ! !! ! !! ! ! ! ! ! !! !! !! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! !! ! !! ! !! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !!! !! !! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! !! ! ! ! ! ! ! ! !! !! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! !! !! ! ! !! ! ! ! !! ! ! ! ! ! ! !! ! ! ! !!! ! ! ! ! ! ! ! ! !! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! !! ! ! ! ! ! ! !! !! ! ! ! ! ! ! !!! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! !! ! !!!!! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! !! ! ! ! ! !! ! ! ! ! ! !! ! ! ! ! !!! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! !!! ! ! !! !! !!

Clay

! !! !

Montague

! !! !

! ! !

OK
Cooke

Wise

Jack

Collin Gerry

Wade Phillips

(Raymond James & Associates)

(Houston Texans)

Parker

Ft Worth

Tarrant

Hood

Oil 101 October class

Somervell

Johnson

Bosque

18

Jim Handschy

Chris Cragg
(Oil States International, Inc.)

(ConocoPhillips)

Julius Svoboda
(U.S. Department of Commerce)

Greg Perez

FSOs at Oil States International, Inc.

(Halliburton)

19

F S O

F O R E I G N

S E R V I C E

O F F I C E R

T R A I N I N G

PESA has remained the training highlight of the year for Foreign Service Officers since 1992, accruing a wait list for officers eager to attend. Member companies donate their time, personnel, and facilities to give FSOs a hands-on overview of the petroleum industry from production to supply.

In return, PESA member companies gain valuable, educated contacts in the FSO communityto date, the program has trained more than 475 officers, who now operate in more than 40 countries around the world.

The twentieth FSO class of 23 graduates all hailed from the U.S. Department of State. Their current assignments range from Accra, Caracas, Amman, Dhahran, Astana, Kyiv, and more. Highlights of this years FSO training included the James Baker III Institute for Public Policy; a half-day with ConocoPhillips exploration and downstream team; a tour of Schlumbergers Genesis drilling rig; a visit to the Museum of Natural Sciences Weiss Energy Center; a discussion on fracking with Halliburtons Ron Hyden; a tour of Halliburtons new Research and Development Center; a tour of the FMC Technologies, Inc. production floor; and a tour of the Oil States International, Inc. fabrication center. PESA Chairman Chris Cragg (Oil States International, Inc.) addressed the group at a small reception for the officers. He stressed the importance of their serving in oil and gas producing countries, the same countries in which many PESA members operate. We believe that PESAs Foreign Service Officer Training Program is like none other and is beneficial to both our government representatives and PESAs member companies. We appreciate the interest and the work that FSOs do in their roles with the U.S. government. We need them to help us support our businesses because what we do is not only critically important to the country, it is important to our employees and the communities in which we live.

FSO class of 2012

20

C I D

C R E D I T

I N T E R C H A N G E

D I V I S I O N

The Credit Interchange Division is a vital, everyday business service for subscribers which allows its members to access current confidential ledger experiences, which helps to determine customer credit worthiness.

This year, CID received more than 38,000 requests for credit experience from its member companies. These requests were fulfilled from CIDs database of nearly 9,000 reports on domestic and international customers which represent over 41,000 lines of ledger experience. Two new members joined this year: Complete Energy Services and Archer Well Company.

The CID Committee also sponsored a three-day annual meeting held this year at The Resort at Tapatio Springs. The meeting featured four guest speakersBlake Hastings, Vice President in Charge, Federal Reserve Bank of Dallas-San Antonio Branch; David Bat, President of Welling & Company; Chris Cragg, Senior Vice President for Operations, Oil States International, Inc., and Sherry Mama, Senior Vice President, MetroBank NA. Bat works with producers to find trends in drilling, completions, production, and desires for technological improvement. He presented findings from his companys 2012 Fracturing Report, which is an industry-wide update of unconventional resources, risk, and uncertainty. Among the data was an operators wish list for technological improvements. The first is to improve multi-stage frac techniques and effectiveness so operators can get more out of their $60 billion annual frac spend. Second is to develop environmentally friendly frac fluids, due to the public assumption that fracturing harms the environment63 percent of operators say that its important in their choice of frac supplier, even if they dont purchase it. Cragg says that along with new resources, unconventional production has brought new challenges. PESA is working to help address some of those challenges through education. Weve made two trips to Washington, D.C., and met with our representatives to ensure our story is heard. Weve been to Ohio twice in the emerging Utica shale, trying to get involved at a high level early on to talk about the economic benefits of our companies to their communities. Everywhere we go, we need to talk about the jobs, technology, and stability that our industry provides. Mama discussed the credit departments roles in standby letters of credit, as well as the newest version of Incoterms. Its important to agree on Incoterms at the initial stage of negotiation for any transaction, says Mama. What you dont know can certainly get you with the wrong Incoterms, such as if you contract for loading and unloading charges and dont know ityour profit can quickly disappear. Finally, two CID Committee membersRoss Guthrie, Vice President - Credit Services, Key Energy Services, Inc. and Doug Dunlap, Director, Credit & Collection, Archer Well Company, Inc.led a discussion on the value of credit departments within their companies.

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Doug Dunlap
(Archer Well Company, Inc.)

Ross Guthrie
(Key Energy Services)

David Bat
(Welling & Company)

Sherry Mama
(MetroBank NA)

Rob Thilsted and Lance McArthur

(Key Energy Services) and (GE Oil & Gas)

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Steve Jacobs
Chief Marketing Officer (Decision Strategies, Inc.)

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Te c h n o l o g y

Complex wells are being drilled today that were not possible even a few years ago. Spurred by the worlds insatiable appetite for energy, the oil and gas industry has made massive investments in people and technology to produce from increasingly harsh environments. These advancements, particularly in hydraulic fracturing and extended reach drilling, have caused a dramatic turn-around in U.S. oil and gas production. The rate of advancement in these technologies is impressive, says Steve Jacobs, Chief Marketing Officer, Decision Strategies, Inc. From single stage fracs just a few years ago, its now possible to frac wells with 100 stages, using as much as one million pounds of sand in each stage. We also have the ability to drill offshore wells with pressures in excess of 30,000 psi and temperatures exceeding 500 degrees. These wells require not only a range of new technologies and processes, but tenacity on the part of the technology providers and users to integrate increasingly sophisticated products and services. The petroleum industry is often the focal point of criticism. As technology providers that have reversed the decline in domestic oil and gas production, the industry should be given considerable credit for making the country less dependent on countries with geopolitical views that conflict with our own.

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Te c h n o l o g y

Drilling in 2,000 feet of water was considered deep in 1995today, its barely getting your feet wet. The lynchpin technology for safely and economically moving the subsea industry to waters up to two miles deep was the ROV, says Charles Jones, President of Downhole, Drilling & Subsea for Forum Energy Technologies. Until recently, the ROV was a secondary method of interventionthey were a potential risk item. Operators on the surface directly controlled seabed infrastructure via miles-long cables, and the ROV was a contingency. But now, ROVs are rock-solid reliable, and theyve become the primary and secondary means of intervention. As soon as you start using the vehicle as the primary function, the design and architecture of the mechanical devices on the seafloor changes dramaticallyyou no longer have to control it from the surface. Today, if you need to install a tree or a wellhead, you just lower it down, the vehicle swims over and does the work. The changes in design and subsea architecture have also kept subsea drilling cost-competitive with the emerging oil shale plays on land. Deepwater is still where the more conventional, giant reserves are. The dependability of the hardware being placed on the sea floor and the economic installation processes that have been developed will keep subsea production safe and economically viable for decades to come.

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Charles Jones
President of Downhole, Drilling & Subsea (Forum Energy Technologies)

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Y E A R

I N

R E V I E W

Gulf Coast-Louisiana District Meeting Deepwater is increasingly becoming more attractive to producers around the globe. As less-than-positive geopolitics dominate many land-locked reservoirs and dozens of new deepwater discoveries are made, offshore drilling has become a major focus for the industry, says David Williams, Chairman, President & CEO of Noble Corporation. Speaking at the PESA Gulf Coast - Louisiana Meeting in Lafayette, Williams says that deepwater production is rapidly expanding and will continue to do so for the immediate future. For example, in 2000, 2 percent of global oil and gas production came from deepwater. Today, its 7 percent and deepwater is forecast to comprise 10 percent of global production by 2020. Sustainable crude oil prices, excellent exploration success, and geographic expansion are the major drivers of deepwater activity, he says. The prospects for deepwater activity remain excellent through 2014.

David Williams
(Noble Corporation)

While worldwide rig utilization remains at about 90 percent, the U.S. Gulf of Mexico was a consistent hotbed of activity until the Macondo disaster. Before the spill, floating rig utilization was nearly 100 percent, fell past 90 percent but has rebounded 97 percent. Jack-ups utilization fell from 80 percent to 70 percent but has rebounded to 92 percent. Shallow water activity has been slowed by low gas prices and the North America shale plays theres high idle capacity, he says. The Gulf of Mexico is an impressive hydrocarbon region, especially in deepwater. Of all deepwater discoveries from 2006 to 2011, nearly one-fourth of 181 were in the Gulf of MexicoNoble had five of those. The rebound in rig utilization in the Gulf is a direct result of the well permitting process recovering, says Williams. From 2010 to 2011, only 7 permits were issued in waters greater than 1,500 feetin the first four months of 2012, 11 permits have been issued.

David Williams and Gary Halverson

(Noble Corporation) and (Cameron)

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The day rate environment is supported by tight supply and demand dynamics, sustainable crude oil prices, and excellent exploration success, he says. Look for a continuation of shallow and deepwater capacity additions as aged equipment is replaced and shipyard economics remain attractive. Supply Chain Seminar This years Supply Chain Seminar focused on current trends and best practices of oil and gas supply chains. The meeting featured four speakers and drew more than 250 members. Marc Waco, Principal of PWC PRTM Management Consulting, and Joe Francis, Executive Director of the Supply Chain Council, kicked off the meeting with the results of the Councils study to understand the supply chain performance of oil and gas infrastructure companies. The study found that customers are demanding better reliability and responsiveness from their suppliers supply chainsmost believe that

More than 250 members attended the 2013 Supply Chain Seminar.

quality is the top focus, and supply chain metrics such as on-time delivery and order fulfillment lead time are second and third. And the pair recommended that rather than scaling up supply chain operations with older methods, there are many opportunities to benchmark other industries with forecasting and sales planning being the likely first steps. Next, Alexandre Baubert, Global Category Manager for Schlumberger, delivered an update on the companys journey to improve its supply chains. We must constantly challenge ourselves, benchmark, and innovate, he says. Together, we will achieve better results and create a safer, more reliable, and cost-effective work environment. Next, Kurt Hallead, Managing Director and Co-Head of Global Energy Research for RBC Capital Markets, gave a world overview and forecast of oil, natural gas, NGLs, and service company stock performance.

Kurt Hallead
(RBC Capital Markets)

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Explorers Award From afar, Pioneer Natural Resources seems a typical independent E&P companywhere once they eyed other continents, U.S. unconventionals are now the draw. But Pioneer is far from a typical operator. The honeymoon phase of their homecoming is still fresh, having sold off their international assets to invest heavily in the Southwest. The company is on a tremendous growth curve, says Robert Workman, President of Distribution and Transmission for National Oilwell Varco and Chairman of PESAs Explorers of Houston Committee. Pioneer invested $2 billion in drilling operations last year to support 904 wells drilled, compared to 78 wells in 2009 and 481 in 2010. Additionally, Pioneers CEO has directed major investments in reducing the use of fresh water in fractured wells and in measuring, reporting, and reducing environmental impacts. Workman presented Pioneers executive team with PESAs highest award, the 2012 Explorers Award. The award is the Associations means of recognizing excellence among producers in a variety of categories. Since 1999, PESA presents the award to an oil and gas exploration and production company that has a proven record of pursuing and achieving the advancement of technology and innovation in the energy industry, while maintaining a track record of safety and community involvement. Accepting the award was Pioneer Chairman and CEO Scott Sheffield and five members of his executive team. He says that Pioneer executives decided on a strategic shift for the company 5 to 6 years agoPioneer would divest all international assets and focus on U.S. soil.

Jim Ford
(ConocoPhillips)

Oil prices will be roughly flat for 2013, which will support most planned oil activity in the U.S. and internationally. Natural gas, however, will remain below $4 and RBC does not forecast a meaningful increase in the current environment. The U.S. land rig count will be down year-over-year by 5 percent, but will climb throughout the year while activity in the Gulf of Mexico continues to climb. Finally, Jim Ford, Vice President of Government Affairs for ConocoPhillips, discussed the political climate in Washington, D.C. as well key federal issues that affect the oil and gas industry. The top issue facing the industry, he says, is the potential taxation of the industry including the repeal of Intangible Drilling Costs. He also answered the reason for Congresssional deadlock. Congressmen and Senators are elected officials, and if theyre doing their jobs, they vote along the lines of their constituency, he says. Within the past 10 years, weve become almost a 50/50 nationhalf on one side, and half on the other, and Congress reflects that.

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The service outlook is murky, he saysrig count has reduced steadily since June and prices are beginning to erode in some areas. The erosion in rig count is due to a lack of urgency in the E&P sector, which in turn is due to a lack of reward from Wall Street. E&P growth isnt being rewarded, so theres no incentive to up a companys growth from 25 percent to 30 percentthats driving an environment where domestic E&Ps already know theyll hit their annual target, and dont want to seek more money. With that comes an oversupply in some of the service businesses, which leads to the first price decline in several years, and reinforces that lack of urgency. We dont see a drastic services demand contraction from current levels, but there is still risk. For natural gas, Tillery says that 2013 is too early for a dramatic gas-directed demand recovery, though supply is on the cusp of finally moving lower. He forecasts a 2 percent decline in supply for 2013, with most of the loss coming later in the year. Gas rig count is likely bouncing along the bottom and is likely to inch upward next year when an

Steve Jacobs and Dominique Shu of Decision Strategies, Inc. catch up with Galen Cobb of Halliburton

We decided to sell out of these international assets because of whats happening with shalesit turns out that we probably have the biggest shale in the world with the exception of Saudi Arabia, says Sheffield. The Wolfcamp shale is between 1,500 and 2,000 feet thick with five zones that were going after, and we have enough drilling locations to last us 100 years. He says the companys greatest upcoming challenge is the disconnect between Brent crude pricing and WTI. As you know, WTI crude has been under pressure, and were receiving $23 less than Brentits something that we didnt expect, he says. Were planning on $85 crude next year, and the strip shows the Brent / WTI split narrowing over the next several yearswe hope it does. Membership Meeting Next year looks to be stable and largely uneventfulfor now, says Jeff Tillery of the oil and gas investment bank Tudor, Pickering, Holt & Co.

Jeff Tillery
(Tudor, Pickering, Holt & Co.)

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Ohio Governors Roundtable Following in the footsteps of oil shale booms in South Texas and North Dakota, Ohio is likely to become a major energy producer via the Utica Shale. However, its still early in the process, and the states leadership is laying the groundwork for energy policy. To that end, the Governor and his Cabinet have sought input from all sectors of the oil and gas industry, including PESA. On Aug. 30, 21 PESA member company executives flew to Columbus for a roundtable discussion on energy. Cabinet members asked to hear the industrys needs, concerns, and positives in Ohio to ensure companies find a friendly environment to grow their businesses. We realize the importance of your sector, says David Mustine, Managing Director for Energy, JobsOhio. Were not North Dakota, we have a large workforce and industrial basewe realize how important you are to the development of shale and job creation for the state. Ohios leadership is looking to benchmark other states work in shaping its energy policies.

Bob Potter and Paul Coppinger

(FMC Technologies, Inc.) and (Weir Oil & Gas)

additional 40 gas rigs will be added. Gas services demand also will begin a slow recovery in 2013. On the oil side, rig count has fallen from its highs earlier in 2012, with about half of that in the Williston and Permian Basins. Yet Tillery says that the economics are solid, but price sensitive. When crude dipped sub-$80, the transaction market dried upwe can now think of $80 as the marker where many of the marginal supply areas flip the switch to uneconomic. Finally, NGL production has grown significantly and is approaching 2 million barrels per day and will increase by 50 percent in the next four years. However, the growth is not all positive from a commodity view. We saw ethane price over the summer go to virtually zero. As NGL production grows, theres a miss-match in growth between production and petrochemical growth. Meanwhile, cheap natural gas is eroding propane demand in the northeast.

Ohio Governors Roundtable attendees

31
Members of the Cabinet worked with 15 other states to ensure that Ohio has a proper regulatory structure. We think we have a good foundation for E&P companies, and therefore a good foundation for your sectorwe think were hitting the mark, says Craig Butler, Executive Assistant for Energy, the Environment, and Agriculture. However, a common view of the states energy policy process is that its becoming too onerous to encourage the rapid development of the Utica. Rick Simmers, Chief of the Division of Oil and Gas Resources, simply answered that Ohio doesnt have more regulations than states like Texas, for example. I think the reason that the Utica is developing slower is lessons learned from the Marcellus as well as infrastructure. We had one operator drilling 150 wells per year, but the infrastructure wasnt there. Theyre now working with us to set up the mid-stream. We have a lot of wet gas, and it must be processedwe have plans underway for nine processing stations. The key to success for the industry is the social license to operate, and the opposition is being led by environmental groups and political opponents of the governor, says Laurie Stevenson, Deputy Director for Business Development, Ohio EPA. Environmental groups say that the industry is unsafe, that it creates winners and losers, that its too close to regulators, and that the state will be a dumping ground for waste wells both from in-state and out of state. We need to dispel these myths. Tell us your constraints and timing so we can help you with permitting for facilities, et cetera. Explorers Golf Tournament For multiple years running, weather has been on PESAs side for the Annual Explorers of Houston Golf Tournament. This year was more of the same, yielding yet another picture perfect day on Redstone Golf Clubs links. More than just a great day of golf, the Explorers of Houston Golf Tournament is a chief contributor for much of PESAs community involvement. Proceeds from the event support the Explorers of Houston Award, the Offshore Energy Center, and the National Energy Education Development Program. For the fourteenth annual tournament, thirty-two teams hit the links at Redstones pro course. The event was chaired and organized by Committee Chairman Robert Workman, Group President, Distribution and Transmission, National Oilwell Varco, and was sponsored by Gulf Publishings World Oil, Schlumberger, National Oilwell Varco, GE Oil & Gas, Oil States International, and Energy Alloys. Each player received a gift card for an on-site Nike pro shop. The tournament champions, with a score of 118, were Shaun Able (Halliburton), Blake Jared (Apache), Bill Henn (Halliburton), and John Graham (Apache).

Randy DeWerff
(Harbison-Fischer Inc.)

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Paul Coppinger
President of Pressure Pumping (Weir Oil & Gas)

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S t a b i l i t y

Twenty-twelve saw U.S. oil production grow more than any other year in industry historya year-over-year increase of 779,000 barrels per day. In February, 2013, the U.S. surpassed 7 million barrels per day in crude production. With the 100-year reserve of natural gas, America is once more a global leader in energy production, bringing about thousands of new jobs and a rebirth in American manufacturing. Behind the nations newfound energy stability is the marriage of two technologies and the conquest of formations that were avoided until a few years ago. Shale has re-invigorated the North American oil and gas industry, says Paul Coppinger, President of Pressure Pumping, Weir Oil & Gas. Its been an interesting evolutionweve fracked wells since the 1940s, recently mastered horizontal drilling, and traditionally avoided shale. But now weve taken those two technologies, applied them to shale, and created the oil and gas industry of the future. Weir invested millions and will continue to invest in manufacturing, service, and R&D to improve their equipments safety, durability, and capacity to meet the demanding needs of the new shale era. There is a sense of pride knowing that our contributionsthe decision to invest in technology and increase capacity when we didhave allowed our customers to support the oil & gas producers in leveraging this great resource that we have in North America.

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S t a b i l i t y

Not long ago, Americas oil production continued its decades-long downward spiral while simultaneously gearing up to play in the global LNG importation market. Then came the shale revolution. Today, both oil and natural gas production have dramatically increased. The U.S. is now an energy provider. The countrys new found stability in energy supply is leading businesses and government alike to change the way they view economic opportunity, job creation, and energy security. Were just now realizing the opportunities that come from the bounty Mother Nature put under both Republican and Democratic districts, and a lot of that is through the technology, expertise, and talent of PESA member companies, says Bob Moran, Halliburtons Vice President for Government Affairs. Even here in Washington, D.C., there has been an awakening among some of our elected officials who were not previously inclined to support domestic energy development. Now theyre seeing the attendant benefits in the form of local jobs. Its a whole new conversation. By maintaining a dialog between industry and government, Moran says we can improve collaboration, and when that happens, all things are possible.

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Bob Moran
Vice President - Government Affairs (Halliburton)

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E X E C U T I V E
Chris Cragg Chairman Oil States International, Inc. Charles Jones Vice Chairman Forum Energy Technologies Paul Coppinger First Vice President Weir Oil & Gas John T. Gremp Immediate Past Chairman FMC Technologies, Inc. James B. Renfroe, Jr. Treasurer Consultant

C O M M I T T E E
Paul Butero Secretary SCF Partners Joseph C. Winkler Gulf Coast District ChairmanTexas Complete Production Services, Inc. Gary Halverson Gulf Coast District ChairmanLouisiana Cameron Johan Pfeiffer Mid-Continent District Chairman FMC Technologies, Inc. Charles Currie Membership Chairman Schlumberger Robert Workman Explorers of Houston Chairman National Oilwell Varco Galen Cobb Emerging Leaders Liaison Halliburton Pat Bond Energy Educators Chairman Light Tower Rentals

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C O M M I T T E E
Corporate Counsel Advisory Co-Chair Brad Eastman Cameron Corporate Counsel Advisory Co-Chair Mark Wolf FMC Technologies, Inc. Credit Interchange Division Senette Parker National Oilwell Varco E-Business Charles Currie Schlumberger

C H A I R M E N
Energy Educators Pat Bond Light Tower Rentals Executive Chris Cragg Oil States International, Inc. Explorers of Houston Robert Workman National Oilwell Varco Finance James B. Renfroe, Jr. Consultant Government Relations Bob Moran Halliburton Health, Safety & Environment A. J. Leuterman M-I SWACO Human Resources Jill Curry Oil States Energy Services Membership Charles Currie Schlumberger Quality Gary Devlin Cameron Service Terry Lechinger Stress Engineering Services, Inc. Supply Chain Gary Kilponen Cameron

Emerging Leaders Mike Hessel Oceaneering International, Inc.

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F I N A N C I A L S

PESAs strength adds value for our member companies.

As we know, our industry faces an uphill public relations battlewere often viewed as part of a problem, not part of a solution. A solid Association with 208 member companies with more than one-half million jobs gives our member companies a collective voice to tell our story wherever its needed, be it in local community or the federal government. It also helps us address our long-term challenges, such as the talent shortage that looms ahead. PESA has supported the IPAA energy academies from their inception with speakers, funds, scholarships, and more. This year, thanks to the continuing positive financial performance of PESA, we have entered into a full partnership with IPAA to support the energy academies and help train tomorrows industry leaders. Our trade association is indeed strongPESA is financially sound, well-invested, and more importantly, PESA is growing. Leading the charge was Charles Currie (Schlumberger) and the Membership Committee, which yielded 37 new member companies to PESA, which is just below last years all-time high of 41. The committee managed to not only keep pace with PESA member company mergers, but add to the total membership. As a result, member dues were up $139,815 for the year, totaling $1,060,600 and we now have 208 member companiesan overall increase of 18 companies. PESAs events continue to be a premier source for the service and supply sectors networking, industry trends, and specialty seminars. More than 2,200 members registered for the associations fifteen public events. The largest draws this year, with each meeting attracting at least 250 members, were the Supply Chain Seminar, Membership Meeting, the Executive Address Series with Wade Phillips, and two Oil 101 classes. Strong support for PESA meetings yielded a year-over-year increase of $157,836 in meeting income with a slight decrease in meeting expenses. Overall revenue for the Association increased by $554,722 while overall expenses increased as well, but by a smaller amount$211,990. Investments also performed well for the year resulting in an investment return of $260,268. Finally, though the Credit Interchange Division added two member companies for 2012, usage was down slightly and fees fell by 6 percent.

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PESA is an association that has been with the industry for 79 years, changing with its membership and constantly striving to add value for its members. From a financial standpoint, PESA is poised to be a force for the industry for decades to come. The reason for that success is, of course, our member participation. Thank you all for your ongoing support. James B. Renfroe, Jr. PESA Treasurer Consultant

Financial Overview 2012 Operating Revenue Investment Return Total Revenue Expenses Net Income Assets Liabilities Unrestricted Net Assets Cash and Investments Employees Member Companies $2,249,564 $260,268 $2,509,832 $1,927,362 $582,470 $4,316,713 $378,350 $3,938,363 $4,140,038 6 208 2011 $1,984,056 $(28,946) $1,955,110 $1,715,372 $239,738 $3,661,851 $305,958 $3,355,893 $3,486,969 6 190 2010 $1,926,045 $229,606 $2,155,651 $1,815,721 $339,930 $3,815,153 $698,998 $3,116,155 $3,672,423 6 184

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B O A R D
AT-LARGE

O F

D I R E C T O R S
Doug Rock Houston, Texas James L. Bryan Houston, Texas Max L. Lukens Houston, Texas Russell E. Ginn President & Chief Executive Officer REG Aero, LLC Joseph H. Netherland The Woodlands, Texas Jack Murphy Dallas, Texas Gilbert H. Tausch Sugar Land, Texas James D. Woods Chairman Emeritus Baker Hughes Incorporated Robert H. Smith Dallas, Texas William E. Bradford Dallas, Texas Philip Burguieres Vice Chairman Houston Texans Thomas H. Cruikshank Dallas, Texas J. W. Neely San Juan Capistrano, California W. C. Walker Houston, Texas J. E. Chenault Houston, Texas George A. Helland, P.E. Senior Associate Cambridge Energy Research Associates J. C. Bergin Houston, Texas J. P. Harbin Dallas, Texas E. H. Clark, Jr. San Clemente, California GULF COAST John Carne Executive Vice President Cameron Christopher E. Cragg Senior Vice President Operations Oil States International, Inc. Mark E. Crews Senior Vice President & GM Oilfield Division Lufkin Industries, Inc. Kevin Crowley President & Chief Executive Officer Forged Products, Inc. Charles S. Currie Vice President Marketing & Sales Systems Schlumberger Chad C. Deaton Chairman of the Board, President & CEO Baker Hughes Incorporated Robert Drummond President North America Schlumberger Scott DuBois President & Chief Operating Officer Premier Pipe Bryan Dudman Senior Advisor to the Drilling Group President Smith International A Schlumberger Company David Dunlap Chief Executive Officer & President Superior Energy Services, Inc. Brad Eastman Vice President Deputy General Counsel Cameron

John T. Gremp Chairman & Chief Executive Officer FMC Technologies, Inc. Bill Coates Vice President Sales & Marketing Schlumberger Robert R. Workman Group President Distribution & Transmission National Oilwell Varco David H. Barr President Dennis Tool Galen Cobb Vice President Industry Relations Halliburton Jack B. Moore Chairman, President & Chief Executive Officer Cameron Robert L. Potter President FMC Technologies, Inc. Craig Ketchum MRC Global George I. Boyadjieff Villa Park, California Sheldon R. Erikson Director Cameron Loren K. Carroll Smith International, Inc. Rhys J. Best Chairman of the Board & Chief Executive Officer Seren Management LLC Zeke Zeringue Waggaman, Louisiana Peter D. Kinnear The Woodlands, Texas

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Jorge Goudet President Auge Industrial Fasteners Gary Halverson President Surface Systems Drilling Systems Cameron Pat Herbert Executive Chairman JDR Cable Systems Ltd. Will Honeybourne Managing Director First Reserve Corporation William H. Howard, Jr. Chairman of the Board & CEO Houston Plating & Coatings, LLC Charles E. Jones President Downhole, Drilling & Subsea Forum Energy Technologies Larry Kerr Vice President & General Manager Petroleum & Industrial Pumps Gardner Denver, Inc. Michael Kowalski President & Chief Executive Officer Sunbelt Steel Texas M. Kevin McEvoy President & Chief Executive Officer Oceaneering International, Inc. Neil J. Mendes Senior Vice President Global Sales & Marketing Greene, Tweed & Co. M. A. (Pete) Miller, Jr. Chairman & Chief Executive Officer National Oilwell Varco T. Duane Morgan President Engineered Products Group Gardner Denver, Inc. Daniel Newman President Norris Production Solutions Johan Pfeiffer Vice President Surface Technologies FMC Technologies, Inc. Douglas A. Polk Vice President Industry Affairs Vallourec & Mannesmann USA Corporation Dennis Proctor Chief Executive Officer Hunting PLC Saeid Rahimian Senior Vice President & Group President Energy Services Group Robbins & Myers, Inc. Michael Read President & Chief Executive Officer Teledyne Oil & Gas Bruce Ross Partner OFS Energy Fund, LLC Gary W. Stratulate Chief Executive Officer Axon Energy Products Steve Turk Director U.S. Sales Weatherford International Ltd. Dave Warren President & Chief Executive Officer Energy Alloys Richard L. Williams President Baker Hughes Incorporated Otto Windholz, Jr. President & Chief Operating Officer Consolidated Pressure Control, LLC Joseph C. Winkler Chairman & Chief Executive Officer Complete Production Services, Inc. Superior Energy Services, Inc. Jim Wright President Valves & Measurement Cameron MID-CONTINENT Bradford S. Baker Chief Executive Officer Chickasaw Distributors, Inc. Pat Bond Chief Operating Officer Light Tower Rentals Paul M. Coppinger President Pressure Pumping Weir Oil & Gas Bob Greenwood General Manager Bestolife Corporation Rip L. Martin General Manager Aztec Tubular Products Steve Noon Director Divisional Managing Weir Oil & Gas Jack Rogers President Ferguson-Beauregard Norris Production Solutions C. Richard Sivalls President Sivalls, Inc. Frank Smith President Platinum Vapor Control Bob Weber Area Sales Team Leader National Oilwell Varco

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M E M B E R

C O M P A N I E S
Archer Rental Services LLC a Division of Archer Well Company, Inc. Doug Dunlap Director, Credit & Collection Houston, Texas Archer Tubular Services LLC a Division of Archer Well Company, Inc. Doug Dunlap Director, Credit & Collections Houston, Texas Archer Underbalanced Services LLC a Division of Archer Well Company, Inc. Doug Dunlap Director, Credit & Collection Houston, Texas AWC Frac Valves Inc. a Division of Archer Well Company, Inc. Linda Johnson Collection Specialist Houston, Texas Gray Wireline Services, Inc. a Division of Archer Well Company, Inc. Wayne Kelley Credit Manager Fort Worth, Texas Great White Pressure Control, LLC a Division of Archer Well Company, Inc. ShaMesha Dean Collection Specialist Supervisor Oklahoma City, OK Rig Inspection Services (US), LLC a Division of Archer Well Company, Inc. Doug Dunlap Director, Credit & Collection Houston, Texas Aries Freight Systems L.P. Jeff L. McIntyre President & Chief Executive Officer Houston, Texas Auge Industrial Fasteners Jorge Goudet President Houston, Texas Austin White Lime Company Oscar Robinson General Partner Austin, Texas Axon Energy Products Colleen Henneke President Houston, Texas Aztec Tubular Products Rip L. Martin General Manager Crowley, Texas Baker Hughes Incorporated Richard L. Williams President Houston, Texas Basic Energy Services Doug Rogers Vice President - Marketing Fort Worth, Texas Bestolife Corporation Bob Greenwood General Manager Dallas, Texas Beta International Inc. Bryan Leavitt Chief Executive Officer Houston, Texas Big Ass Fan Company Brian Smith Energy Accounts Manager Houston, Texas

911 Equipment Inc. Maria R. Tortolani Vice President - Finance Weston, Florida Global Fox LLC Otto Piccardo Vice President Corporate & Public Affairs Weston, Florida American Block Mike Borg Director - Sales Houston, Texas Archer Well Company, Inc Doug Dunlap, CCE Director, Credit & Collection Houston, Texas Archer Directional Drilling Services LLC a Division of Archer Well Company, Inc. Linda Johnson Collection Specialist Houston, Texas Archer Drilling LLC a Division of Archer Well Company, Inc. Doug Dunlap Director, Credit & Collection Houston, Texas Archer Oil Tools a Division of Archer Well Company, Inc. Doug Dunlap Director, Credit & Collection Houston, Texas Archer Pressure Pumping, LLC a Division of Archer Well Company, Inc. Connie Wooden Collection Specialist Oklahoma City, OK

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Boyden Global Executive Search James N.J. (Jim) Hertlein Managing Director Houston, Texas C&C Industries, Inc. JoElla Bott Vice President Houston, Texas Cameron Jack B. Moore Chairman, President & Chief Executive Officer Houston, Texas Cameron Glenn Chiasson President Drilling Systems Houston, Texas Cameron Owen Serjeant President Process & Compression Systems Houston, Texas Cameron Jack B. Moore Chairman, President & Chief Executive Officer Subsea Systems Houston, Texas Cameron Gary Halverson President Surface Systems Houston, Texas Cameron Jim Wright President Valves & Measurement Houston, Texas Cameron John Carne Executive Vice President Houston, Texas Casedhole Solutions, Inc. Don Gawick President & Chief Executive Officer Houston, Texas Caterpillar Global Petroleum Wayne T. Zemke Market Intelligence Manager Marine and Petroleum Power Division Houston, Texas Caterpillar Inc. Wayne T. Zemke Market Intelligence Manager Marine and Petroleum Power Division Peoria, Illinois Chickasaw Distributors, Inc. Bradford S. Baker Chief Executive Officer Houston, Texas Circor Energy Products, Inc. Saurabh Singh Vice President & General Manager - KFI Houston, Texas Cochrane Technologies, Inc. Douglas A. Cochrane, Jr. President & Chief Executive Officer Lafayette, Louisiana Consolidated Pressure Control, LLC Otto Windholz, Jr. President & Chief Operating Officer Houston, Texas Decision Strategies Pat Leach Chief Executive Officer Houston, Texas Decision Strategies Steve Jacobs Chief Operating Officer Houston, Texas DOYLES Dan Henderson President & Chief Executive Officer Houston, Texas Dupr Energy Services LLC Cornelius Dupr Chairman & Chief Executive Officer Houston, Texas EVO I.D.T LLC Shane Deerman President Mansfield, Texas Endeavor Management Michael Shook Executive Vice President Houston, Texas Energy Alloys Dave Warren President & Chief Executive Officer Houston, Texas Enventure GT Nyla Shepherd Senior Accountant Houston, Texas Exterran Matthew Pickle International Credit Manager Houston, Texas FMC Technologies, Inc. John T. Gremp Chairman & Chief Executive Officer Houston, Texas FMC Technologies, Inc. Robert L. Potter President Houston, Texas

44
FMC Energy Infrastructure FMC Technologies, Inc. John T. Gremp Chairman & Chief Executive Officer Houston, Texas FMC Subsea Technologies FMC Technologies, Inc. John T. Gremp Chairman & Chief Executive Officer Houston, Texas FMC Surface Technologies FMC Technologies, Inc. John T. Gremp Chairman & Chief Executive Officer Houston, Texas First Reserve Corporation Will Honeybourne Managing Director Houston, Texas Flexitallic Group, Inc. Jerry L. Lastovica President & Chief Executive Officer Kingwood, Texas Flexpipe Systems Dane Lee Broussard President Houston, TX Forge USA Wade Brougher President Houston, Texas Forged Products, Inc. Kevin Crowley President & Chief Executive Officer Houston, Texas Forum Energy Technologies C. Christopher Gaut Chairman & Chief Executive Officer Houston, Texas Forum Energy Technologies Charles E. Jones President Downhole, Drilling & Subsea Houston, Texas Forum Energy Technologies Wendell Brooks President Production & Infrastructure Houston, Texas Freudenberg Oil & Gas Richard T. Schmidt President Houston, Texas GE Oil & Gas Andrew Way Vice President Houston, Texas GE Oil & Gas Gary Ford President Artificial Lift Houston, Texas GE Oil & Gas Jim Junker President Downhole Technologies Houston, Texas GE Oil & Gas Andrew Way Vice President Drilling & Surface Houston, Texas GE Oil & Gas Ian Milne President Pressure Control Houston, Texas GE Oil & Gas John Paul Jones President Logging Services Houston, Texas GE Oil & Gas Rod Christie Vice President Subsea Systems Houston, Texas GE Oil & Gas Andrew Way Vice President Turbomachinery Houston, Texas Gardner Denver, Inc. T. Duane Morgan President Houston, Texas Gardner Denver, Inc. T. Duane Morgan President Engineered Products Group Houston, Texas Global Oilfield Services Stuart A. Spence Executive Vice President & Chief Financial Officer Sugar Land, Texas Global Tubing, LLC C. Robert Bunch Chairman of the Board & CEO Dayton, Texas Greenes Energy Group, LLC Robert P . Vilyus Chief Executive Officer Houston, Texas Greene, Tweed & Co. Ron Callaway Vice President, General Manager Oilfield & PetroChem & Power Oilfield Division Houston, Texas Gulf Publishing Company/ World Oil John T. Royall President & Chief Executive Officer Houston, Texas

45
Halliburton David J. Lesar Chairman of the Board, President & CEO Houston, Texas Halliburton Galen Cobb Vice President - Industry Relations Houston, Texas Hamilton Acquisitions, Inc. Bruce S. Billeaud Controller Lafayette, Louisiana Hart Energy Richard A. Eichler Chief Executive Officer Houston, Texas Holland 1916 Jim Stradinger President/Partner North Kansas City, Missouri Hoover Group, Inc. Donald W. Young Chairman & Chief Executive Officer Houston, Texas Houston Plating & Coatings, LLC William H. Howard, Jr. Chairman of the Board & CEO South Houston, Texas Hunting PLC Dennis Proctor Chief Executive Officer The Woodlands, Texas National Coupling (Hunting Subsea) Hunting PLC Gary G. Weathers President & Chief Executive Officer Stafford , Texas Hydril USA Distribution LLC Christi Raymond Credit & Collections Leader Houston, Texas IBM Global Business Services Jack Seigler Partner The Woodlands, Texas IDG Energy & Specialty Distribution Holdings, LLC Lynn Perrin President Houston, Texas JDR Cable Systems Ltd. Pat Herbert Executive Chairman Houston, Texas Jet-Lube, Inc. Tom Blake Vice President Sales Houston, Texas Key Energy Services, Inc. Dick Alario Chairman of the Board, President & CEO Houston, Texas LegalWATCH Eartha Johnson President Houston, Texas Light Tower Rentals Pat Bond Chief Operating Officer Odessa, Texas Lockton Marine & Energy Lockton Companies, LLC David de Roode Vice President Member of LLC Houston, Texas Logan International Inc. David Barr Chief Executive Officer Houston, Texas Lone Star Fasteners, LP Stephen Cabral Enterprise Client Executive Spring, Texas Lone Star Sealing Technologies Lone Star Fasteners, LP Richard Cowen Managing Director Houston, Texas Lufkin Industries, Inc. John F. (Jay) Glick President & Chief Executive Officer Lufkin, Texas Lufkin Industries, Inc. John F. (Jay) Glick President & Chief Executive Officer Power Transmission Division Lufkin, Texas Lufkin Industries, Inc. Mark E. Crews Senior Vice President Oilfield Division Lufkin, Texas MRC Global Randy K. Adams Senior Vice President Upstream Houston, Texas Mam USA, LLC Jason Moore President Houston, Texas Forgiatura Mam Mam USA, LLC Andrea Mam President & Chief Executive Officer Cividate Camuno, Italy

46
mcaConnect David Huether Vice President Energy Solutions Humble, Texas McCoy Corporation Jim Rakievich President & Chief Executive Officer Edmonton, Alberta, Canada McCoy Corporation Jane Debbrecht General Manager INOTEC Edmonton, Alberta, Canada McCoy Corporation Jeff Daigle General Manager Precision Die Technologies Broussard, Louisiana McCoy Corporation Jeff Daigle General Manager Superior Manufacturing & Hydraulics Broussard, Louisiana McCoy Corporation Kelly Carlson General Manager FARR Edmonton, Alberta, Canada Minco Inc. J.B. Cheatham Production/Sales Manager Conroe, Texas Nabors Drilling USA, LP Lauri McDonald Director of Credit - Houston Houston, Texas Nabors Completion and Production Services Robby Nelson Director - Business Development & Marketing Houston, Texas Ryan Energy Technology Nabors Completion and Production Services Lauri McDonald Director of Credit Houston Houston, Texas Superior Well Services Nabors Completion and Production Services Lauri McDonald Director of Credit Houston Houston, Texas National Oilwell Varco M. A. (Pete) Miller, Jr. Chairman & Chief Executive Officer Houston, Texas National Oilwell Varco Robert R. Workman Group President Distribution & Transmission Houston, Texas National Oilwell Varco Burk L. Ellison President Distribution Services Houston, Texas National Oilwell Varco David Daniel President Quality Tubing Houston, Texas National Oilwell Varco Haynes Smith Group President Services Houston, Texas National Oilwell Varco Jeremy Thigpen Sr. Vice President & Chief Financial Officer Downhole Tools & Pumping Solutions Houston, Texas National Oilwell Varco Joe McAnally President Coiled Tubing & Wireline Group Hydra Rig Fort Worth, Texas NedCorp Jack Kulasa President Spring, Texas Newpark Resources, Inc. Frank Lyon Vice President Technical Services The Woodlands, Texas Newpark Drilling Fluids, LLC Joe Gocke Vice President Finance & Planning Houston, Texas Newpark Environmental Services, LLC Jeff Juergens President Lafayette, Louisiana Newpark Mats & Integrated Services, LLC Jeff Juergens President Lafayette, Louisiana Norris Production Solutions Daniel Newman President The Woodlands, Texas C-Tech Norris Production Solutions Mark Widney President & Managing Director Edmonton, Alberta, Canada Ferguson-Beauregard Norris Production Solutions Jack Rogers President Tyler, Texas

47
Harbison-Fischer, Inc. Norris Production Solutions David Martin Managing Director Crowley, Texas Norris Rods Norris Production Solutions Daniel Newman President The Woodlands, Texas Norris/AOT Norris Production Solutions Daniel Newman President The Woodlands, Texas Norriseal Norris Production Solutions Jack Lee Senior Vice President & Managing Director Houston, Texas Oil Lift Technology Norris Production Solutions Daniel Newman President The Woodlands, Texas Pro Rod Norris Production Solutions Daniel Newman President The Woodlands, Texas OFS Portal LLC William (Bill) Le Sage Chief Executive Officer Houston, Texas Oceaneering International, Inc. Knut Eriksen Senior Vice President Subsea Products Houston, Texas Oil States International, Inc. Christopher E. Cragg Senior Vice President Operations Houston, Texas Oil States Energy Services Oil States International, Inc. Christopher E. Cragg President Houston, Texas Oil States Industries, Inc. Oil States International, Inc. Charles Moses President Arlington, Texas Sooner Pipe, LLC Oil States International, Inc. John Shoaff President Houston, Texas Oracle Matt Pitner Area Vice President Energy Houston, Texas PPHB Raymond L. Brown, Jr. Partner Houston, Texas PWC PricewaterhouseCoopers LLP Marc Waco Principal/Advisory Dallas, Texas PennWell / Oil & Gas Journal Roy L. Markum Vice President Custom Publishing Houston, Texas Pioneer Energy Services John S. Huitt Director of Credit San Antonio, Texas Pioneer Production Services, Inc. Joe Eustace President San Antonio, Texas Pipeco Services Gene Hunt Vice President Sales Houston, Texas Platinum Control Technologies Jim Samis President Fort Worth, Texas Platinum Vapor Control Frank Smith President Fort Worth, Texas Pratt Industries, Inc. Bill Pratt President Bridgman, Michigan Precision Drilling Company L.P. Heather Stickel Manager Credit & Collections Houston, Texas Premier Pipe Scott DuBois President & Chief Operating Officer Houston, Texas Preng & Associates LLC Charles L. Carpenter Secretary/Treasurer/Partner Houston, Texas Quarton Partners Rob Parker Managing Director Investment Banking Birmingham, Michigan RBC Capital Markets Shauvik Kundagrami Co-Head of U.S. Energy Investment Banking Houston, Texas

48
RPC, Inc. Allyson Lyons Credit Manager Houma, Louisiana Cudd Pressure Services RPC, Inc. Clint Walker Executive Vice President Midland, Texas Patterson Services, Inc. RPC, Inc. Jim Daniel Vice President & General Manager Houston, Texas RYCO Energy Solutions, Inc. Wolfgang H. Thoene President Houston, Texas Ram Design LLC Richard Romero Vice President Broussard, Louisiana Raymond James & Associates, Inc. Scott McNeill Managing Director Investment Banking Dallas, Texas Robbins & Myers, Inc. Saeid Rahimian Senior Vice President & Group President Energy Services Group Willis, Texas S&S Plating Company/ Coating Dynamics Gregory L. Andrews Vice President Houston, Texas SCF Partners Andrew L. Waite Managing Director Houston, Texas Schlumberger Charles S. Currie Vice President Marketing & Sales Systems Houston, Texas Geoservices A Schlumberger Company Charles S. Currie Vice President Marketing & Sales Systems Houston, Texas M-I SWACO A Schlumberger Company Joe Bacho President Houston, Texas Smith Bits A Schlumberger Company Guy Arrington President Bits & Advanced Technology Houston, Texas Smith International A Schlumberger Company Bryan Dudman Senior Advisor to the Drilling Group President Houston, Texas WesternGeco A Schlumberger Company Carel Hooykaas President Gatwick, United Kingdom Scientific Drilling International, Inc. William B. Wade President & Chief Operating Officer Houston, Texas Select Energy Services, LLC Debbie Burgess MSA/Insurance Administrator Gainesville, Texas Sentry International Mark Burris President Wichita, Kansas Simmons & Company International Matthew G. Pilon Managing Director Corporate Finance Houston, Texas Sivalls, Inc. C. Richard Sivalls President Odessa, Texas Southwest Oilfield Products Paul DeWeese President & Chief Executive Officer Houston, Texas Spencer Stuart Brad Farnsworth Partner Houston, Texas Stallion Oilfield Services Ltd. Craig M. Johnson Chief Executive Officer & President Houston, Texas Saltys Disposal Wells Stallion Oilfield Services Ltd. Craig M. Johnson Chief Executive Officer & President Houston, Texas Stallion Offshore Quarters Stallion Oilfield Services Ltd. Craig M. Johnson Chief Executive Officer & President Houston, Texas

49
Stallion Oilfield Construction Stallion Oilfield Services Ltd. Craig M. Johnson Chief Executive Officer & President Houston, Texas Stallion Production Services Stallion Oilfield Services Ltd. Craig M. Johnson Chief Executive Officer & President Houston, Texas Stallion Rockies Ltd. Stallion Oilfield Services Ltd. Craig M. Johnson Chief Executive Officer & President Houston, Texas Stallion Solids Control Stallion Oilfield Services Ltd. Craig M. Johnson Chief Executive Officer & President Houston, Texas Stream-Flo USA, LLC Blake Phillips Sales Manager Houston, Texas Master Flo Valve (USA), Inc. Stream-Flo USA, LLC David Bradbury Subsea/Offshore Manager Western Hemisphere Houston, Texas Stress Engineering Services, Inc. Terry M. Lechinger Principal Houston, Texas Stress Engineering Services, Inc. Terry M. Lechinger Principal Stress Engineering Services Canada Houston, Texas Sunbelt Steel Texas Michael Kowalski President & Chief Executive Officer Houston, Texas Sunbelt Steel Lafayette, LA Michael Kowalski President & Chief Executive Officer Houston, Texas Superior Energy Services, Inc. David Dunlap Chief Executive Officer & President Houston, Texas Complete Production Services, Inc. Superior Energy Services, Inc. Joseph C. Winkler Chairman & Chief Executive Officer Houston, Texas Integrated Petroleum Services, Inc. Superior Energy Services, Inc. John Graham Vice President Controller IPS U.S. & Mexico Houston, Texas TETRA Technologies, Inc. Geoffrey M. Hertel President & Chief Executive Officer The Woodlands, Texas TIW Corporation Steve Pearce President Houston, Texas Teledyne Oil & Gas Michael Read President & Chief Executive Officer Daytona Beach, Florida Tenaris Jon Barton Director Technical Sales, USA Houston, Texas Texas Institute of Science, Inc. Laslo Olah President Richardson, Texas Texas Steel Conversion, Inc. Brian M. Binau President Houston, Texas Tidewater Inc. Jeffrey M. Platt President, CEO & Director New Orleans, Louisiana U. S. Steel Tubular Products George H. Thompson Vice President Commercial Pittsburgh, Pennsylvania URS JW Williams Steven Russom Senior Vice President URS Flint/President URS JW Williams Waller, Texas Utex Industries, Inc. Stacey Buckingham Administrative Assistant Houston, Texas ValTek Industries, Inc. Shane Hamilton President Odessa, Texas Vallourec & Mannesmann USA Corporation Douglas A. Polk Vice President Industry Affairs Houston, Texas Vallourec & Mannesmann USA Corporation Douglas A. Polk Vice President Industry Affairs Serimax Houston, Texas

50
Vallourec & Mannesmann USA Corporation Douglas A. Polk Vice President Industry Affairs VAM Drilling Houston, Texas Vallourec & Mannesmann USA Corporation Douglas A. Polk Vice President Industry Affairs V&M Tube Alloy Houston, Texas Vallourec & Mannesmann USA Corporation Douglas A. Polk Vice President Industry Affairs VAM USA Houston, Texas Vallourec & Mannesmann USA Corporation Douglas A. Polk Vice President Industry Affairs Vallourec Canada Houston, Texas Vortex Ventures, Inc. Dalton Thomas President & Chief Executive Officer Houston, Texas WEDGE Group Incorporated James Tidwell President & Chief Executive Officer Houston, Texas WEDGE Group Incorporated James Tidwell President & Chief Executive Officer WEDGE Energy Services LLC Houston, Texas Weatherford International Ltd. Bernard J. Duroc-Danner Chairman of the Board, President & CEO Houston, Texas Weir Oil & Gas Paul M. Coppinger President Pressure Pumping Fort Worth, Texas Wells Fargo Energy Group Bret C. West Executive Vice President Houston, Texas

P A S T P E S A C H A I R M E N
1933-1934 W. L. Childs Reed Roller Bit Company 1934-1935 J. A. Crawford Republic Supply Co. of California 1935-1936 J. A. Geismar National Supply Company

1936-1937 W. J. Morris Continental Supply Company 1937-1938 John M. Crawford Parkersburg Rig & Reel Company 1938-1939 J. L. Shakely Jones & Laughlin Supply Company 1939-1940 E. S. Dulin Byron Jackson Company 1940-1941 E. W. Gildart Norvell Wilder Supply Company 1941-1942 Earl W. Miller American Iron & Machine Works 1942-1943 F. F. Murray Oilwell Division - US Steel Corporation 1943-1945 Fred J. Sprang Sprang & Company

51
1945-1947 Hugh Glen Emsco Derrick & Equipment Company 1947-1948 Ardon B. Judd Republic Supply Company 1948-1949 A. W. McKinney National Supply Company 1949-1950 Guy A. Thompson Bethlehem Supply Division 1950-1951 Ted Sutter Baker Oil Tools, Inc. 1951-1952 F. M. Mayer Continental Supply Company 1952-1953 Mason B. Jones S. M. Jones Company 1953-1954 D. D. Bovaird Bovaird Supply Company 1954-1955 Rodney Durkee Lane-Wells 1955-1956 M. E. Montrose Hughes Tool Company 1956-1957 Rainey Elliott Jones & Laughlin Supply Company 1957-1958 Grover Kilgore Halliburton Company 1958-1959 W. J. Powell Continental Emsco Company 1959-1960 W. O. Wilson Wilson Supply Company 1960-1961 E. A. Johnson Schlumberger Well Services 1961-1962 W. H. Larkin Larkin Packer Company 1962-1963 W. J. McWilliams Republic Supply Company 1963-1964 H. H. Peters Technical Oil Tool Company 1964-1965 A. W. Rose Byron Jackson Pump Division 1965-1966 M. F. Hazel Oilwell Division, US Steel Corporation 1966-1967 A. C. Polk Dowell Division, Dow Chemical Co. 1967-1968 W. J. Bovaird Bovaird Supply Company 1968-1969 P . L. Myers Hughes Tool Company 1969-1970 John B. Meritt Byron Jackson Pump Division 1970-1971 R. C. Rieder Continental Emsco Company 1971-1972 B. R. McNulty Dia-Log Company 1972-1973 R. E. Etnyre Machinery & Equipment Division - Armco 1973-1974 E. H. Clark, Jr. Baker Oil Tools, Inc. 1974-1975 J. P . Harbin Halliburton Company 1975-1976 J. C. Bergin Republic Supply Company 1976-1977 George A. Helland, Jr. Weatherford International, Inc. 1977-1978 E. J. Hagstette Camco, Inc. 1978-1979 J. E. Chenault Oilwell Division, US Steel Corporation 1979-1980 James R. Lesch Hughes Tool Company 1980-1981 Ralph W. Noble Milchem, Inc. 1981-1982 W.C. Walker Mid-Continent Supply Company 1982-1983 J. W. Neely Smith International, Inc. 1983-1984 Lee A. Drake Continental Emsco Company

52
1984-1985 T. H. Cruikshank Halliburton Company 1985-1986 E. C. Broun, Jr. Baker Hughes Incorporated 1986-1987 Philip Burguieres Cameron Iron Works, Inc. 1987-1988 W. E. Bradford Dresser-Rand Company 1988-1989 Robert H. Smith National-Oilwell 1989-1990 James D. Woods Baker Hughes Incorporated 1990-1991 Gary D. Nicholson LTV Energy Products Company 1991-1992 Gilbert H. Tausch Camco International, Inc. 1992-1993 Dale P . Jones Halliburton Company 1993-1994 Jack Murphy Dresser Industries, Inc. 1994-1995 Joseph H. Netherland FMC Corporation 1995-1996 Russell E. Ginn The Flexitallic Group, Inc. 1996-1997 Max L. Lukens Baker Hughes Incorporated 1997-1998 James L. Bryan Dresser Industries, Inc. 1998-1999 Doug Rock Smith International 1999-2000 Zeke Zeringue Input/Output, Inc. 1999-2000 Peter D. Kinnear FMC Technologies, Inc. 2000-2001 Rhys J. Best Lone Star Technologies, Inc. 2001-2002 Loren K. Carroll M-I L.L.C. 2002-2003 Sheldon R. Erikson Cameron 2003-2004 George I. Boyadjieff Varco International, Inc. 2004-2005 L. Craig Ketchum Red Man Pipe & Supply Company 2005-2006 Robert L. Potter FMC Technologies, Inc. 2006-2007 Jack B. Moore Cameron 2007-2008 Galen Cobb Halliburton 2008-2009 David Barr Baker Hughes Incorporated 2009-2010 Robert Workman National Oilwell Varco 2010-2011 Bill Coates Schlumberger 2011-2012 John T. Gremp FMC Technologies, Inc.

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Anti-Trust Statement The objectives and activities of the Association shall at all times comply with the applicable laws of the United States of America, its states and local jurisdictions. This compliance shall include strict adherence to the requirements of all antitrust laws including the Sherman Act, the Clayton Act, and the Federal Trade Commission Act as currently enacted. All members and their representatives are responsible for adhering to these requirements and avoiding even the appearance of impropriety in the way their activities are conducted. In order to effectuate the foregoing policy, PESA established guidelines for the conduct of its members during conferences, meetings, and conventions which shall be strictly adhered to by each member and their representatives. If questions arise as to whether a proposed course of conduct complies with the law and this policy, guidance shall be sought from the Chairman, President, or Corporate Counsel Committee of PESA. Approved by the PESA Board of Directors April 22, 1988

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