The Year that was and Grateful Acknowledgement 2008-2009
Michael F. Forlenza, P.G.
HGS Editor
It has been a tumultuous year for Houston and the Houston Geological Society. It was a year that saw wild swings in energy prices, a powerful hurricane, an economic collapse, and a historic and often rancorous presidential election.
When the HGS’s administrative year kicked off in July 2008, the price of a barrel of oil was riding high, surging to a record price of more than $147. There seemed to be no stopping the upward trend. Record oil company profits and boom times were here again. Raise your hand if you thought we would see $200 per barrel oil by the end of 2008. I see a few hands, but the rest of you who did not raise your hand are just in denial. See the Editor’s column in the September 2008 HGS Bulletin for some perspective on the price of energy from the distant historical viewpoint of nearly a year ago.
Since those bygone giddy days of last summer, the price of oil fell to less than $35 per barrel by the end of 2008. It turns out that the spike in the price of oil in 2008 really was due to speculation after all. By May 2009, the price of oil had recovered somewhat to around $54 per barrel. Forecasts for future prices are now more moderate, but likely more realistic.
The slide in the price of oil has had a predictable impact on petroleum exploration and production activities. The North American drilling rig count was cut in half in the past year. In April 2009, Apache Corporation announced the layoffs of 200 workers or about six percent of the company’s 3,600-person workforce. "When you are not as active, you don't need as many people," said Apache spokesman Bill Mintz. ConocoPhillips, El Paso Corporation, and oilfield services companies Baker Hughes, Halliburton, and Schlumberger also announced layoffs in April. ConocoPhilips eliminated 1,350 jobs and Schlumberger cut 5,000 jobs worldwide.
There have been other oil booms, notably during the period between 1982 and 1985 when workers from around the United States surged into a burgeoning Houston. These heady times are inevitably followed by a downturn. The mid-1980s downturn lasted many years. In retrospect, the year 2008 may be notable for having one of the briefest oil boom-bust cycles.
As summer slid towards autumn, the Gulf of Mexico turned violent, unleashing Hurricane Ike. On September 13, 2008, Hurricane Ike roared across the Texas coastline and raked Houston and neighboring municipalities. While life returned to normal for most Houstonians shortly after power was restored, coastal communities were devastated and may take many years or decades to recover, if ever. See the Editor’s column in the December 2008 HGS Bulletin for a discussion of the merits of the Galveston seawall.
The autumn and winter tumble in the price of oil coincided with the slide in the stock market and the disintegration of the global economy. The real estate market in many parts of the country crumbled leading to record foreclosures and toxic debt. We are now facing the worst economic situation at any time since the great depression. The federal government has had to provide tens of billions of dollars in TARP and stimulus funds to prop up profligate banks and financial institutions.
A full economic recovery may be years away, but there are hopeful signs that the crisis is ebbing. Houston has fared better through this economic whirlwind than many parts of the country. Because Houston real estate prices did not rocket they way they did in Florida, Arizona, and California from 2001 to 2007, the fall here has been less severe.
At the end of 2008 and the beginning of 2009, America participated in the ideals of founding fathers by electing a president and witnessing the peaceful transition of our government to a new administration, a new administration with a stated goal of restoring "science to its rightful place." Science and politics have not always been companionable. See the Editor’s column in the November 2008 HGS Bulletin about this sometimes contentious relationship.
With this issue of the HGS Bulletin, my term as Editor draws to a close. Hopefully, you found some worthwhile reading in these pages. It has been a great experience and I have learned a lot. I have had the pleasure of meeting many dynamic people who donate their time to make the HGS a great organization. I encourage all members to get involved with some part of the society even if you just come out to the technical meetings.
My thanks go to the fine HGS editorial board of Charles Revilla, James Ragsdale, and editor-elect Gordon Shields. Their insightful and timely editorial reviews and comments kept me on the right path often through some tough sledding. Good luck to Mr. Shields as he dons the editor’s mantle for 2009 - 2010.
Thanks also to Lisa Kruger for her patience and skill each month assembling the Bulletin and producing a great looking publication. Prime Source Office Solutions did a fine job as the Bulletin printer and mailer. Gratefully acknowledgement also goes to Lily Hargrave in the HGS office who managed the flow of advertisements from diverse sources and the financial aspects of the Bulletin.
Thank you to our advertisers for your support throughout the year and to the authors who contributed the items presented in the Bulletin.
Be well, do good work, and stay in touch.
Happy trails.
Michael F. Forlenza, P.G.
HGS Editor
hgs.forlenza@gmail.com