Bring up oil in an election year and it’s quickly politicized. While some see oil as the future of American independence, others blame the industry for global warming. So which is it?
To get an insider’s view, we sat down with RJ Burr, president of Panex, an oil and gas exploration company based in Bowling Green, Kentucky with operations across the South.
RJ isn’t your typical executive. A third-generation oilman, he’s been immersed in the industry since childhood. “I saw the army of pump jacks and I was hooked,” RJ recalls. “Made my first sale three months out of high school and haven’t looked back.”
Now, with decades of industry experience under his belt, RJ offers a unique perspective on the oil industry’s role in modern society and its prospects for the future.
The Backbone of Modern Life
Now, I know what you’re thinking. Oil? In 2024? Aren’t we all supposed to be going green? Well, RJ’s bringing the other side of that story and he has some pretty eye-opening things to say about that.
First off, did you know that oil isn’t just about transportation? RJ pointed out that it’s in practically everything we use. “Flushing your toilet. No plastic piping, no sewage systems,” he explains. “If it has poly in front of it, it’s oil.” Mind-blowing how much it’s in our day-to-day, right?
From smartphone covers to insulating fibers in clothing, oil-based products are ubiquitous.
“Right now, there is nothing out there that can economically or feasibly replace oil.”
RJ Burr
CEO at Panex
Strong words, but he’s got the experience to back them up.
The American Oil Landscape
Now, let’s bust a myth. When you hear “oil industry,” you probably think of giant corporations like Exxon or Shell. Well, the reality is quite different.
There are 9,000 small, independent operators with an average of 12 employees forming American oil production’s backbone. They produce 83 percent of the oil, 90 percent of the gas, and drill more than 90 percent of domestic wells. When market crashes hit, like the one in 2020, these smaller players often bear the brunt of the impact.
RJ’s company, Panex, is one of these smaller but growing players. And let me tell you, they’ve got some pretty savvy moves.
Seizing Opportunities in Crisis
Speaking of market crashes, RJ and his team at Panex saw the 2020 crash coming – though not quite in the way they expected. “We knew there’d be a shot at the market collapsing,” RJ says. “We were ready for the market to crash and we’re ready to pick up the pieces.”
When COVID-19 hit, and oil prices plummeted, Panex was prepared. They had cash on hand and the courage to make bold moves.
The result? Twenty-three acquisitions and about 100 million barrels of oil in reserve. “If somebody’s going to do it anyway, why not us?” RJ asks. “Why not people who actually care about what happens to the oil?”
The Art and Science of Oil Extraction
You might think finding oil is just about drilling holes and hoping for the best. But RJ and his team? They’re a lot more sophisticated than that.
“We pulled over 40,000 different data sets,” RJ says, describing their process for one field. They analyze thousands of well logs, looking for wells that should have produced more oil but didn’t – often due to outdated extraction methods.
“[Previous well owners] really faced two problems,” RJ explains. “One was gluttony, and the other was sand.” Using modern techniques like screening and gravel packing, Panex can extract oil from these underperforming wells more efficiently and profit where others saw a dry well.
It’s like they’re the detectives of the oil world, finding clues others missed and solving the case of the missing oil. Pretty cool, right?
The Human Element
Despite the high-tech analysis, RJ emphasizes that oil extraction is still human-driven. It’s not all about numbers and barrels. He’s immensely proud of his team, comparing them to the New York Yankees of the oil world. “Our crew in the field… They have figured out how to make a difficult job look easy and that’s the true level of expertise,” RJ boasts.
This focus on having the right people extends to Panex’s investor partnerships. RJ is passionate about educating potential partners and ensuring they understand the risks and potential rewards of oil investment.
Now, if all this oil talk has got you thinking about investing, RJ’s got some words of wisdom.
“If this is money that if the world opened up and swallowed my company and I lost every dime you invested other than the tax benefits, if it would change the clothes you wear, the car you drive or the food you eat, it’s not for you.”
RJ Burr
CEO at Panex
Straight talk like that isn’t something you hear every day in the investment world. But for RJ, it’s all about building trust and long-term relationships.
The Future of Oil
So, what about the future? With all the talk about green energy, you might think oil’s days are numbered. But RJ? He’s not buying it.
He remains confident despite the push for green energy. “There’s nothing out there to replace it,” he states. “As long as people realize, don’t listen to what they’re saying on TV, don’t listen to the talking heads, do the research for yourself, build the data for yourself.”
RJ encourages critical thinking and independent research on energy issues. He believes that many of the current challenges in the oil industry are “self-inflicted” and could be easily fixed with the right policies. “If you have high oil prices, if you have restricted oil, your life is going to be more difficult,” he warns.
Key Takeaways for Leaders
- Embrace unconventional thinking: Look beyond obvious applications for hidden potential in your industry.
- Stay prepared for market shifts: Have strategies ready for crises and opportunities.
- Invest in top talent: Build a team that makes difficult tasks look easy.
- Balance short-term pressures with a long-term vision: Don’t get swayed by trends, but stay informed about legitimate industry shifts.
Conclusion: The Complex World of Oil
Whether you’re team green energy, team fossil fuels, or somewhere in between, there’s no denying that oil plays a massive role in our world right now. And talking to guys like RJ? It opens your eyes to how complex this whole energy thing is.
One thing’s for sure – the debate over our energy future isn’t going away anytime soon. But the more we know, the better equipped we are to tackle these big questions.
In the meantime, companies like Panex are working to extract oil as efficiently and responsibly as possible.
Remember, in the energy world, things are rarely black and white – or should I say, black and green? It’s a complex issue with no easy answers. But by listening to voices from all sides of the debate, including industry insiders like RJ Burr, we can start to piece together a more complete picture of our energy future.
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