What will happen to oil and gas revenue wealth?
The Second World War saw America standing tall as the last industrial giant globally, with jobs sprouting like wildflowers. American factories churned out a bomber every sixty seconds, inundating the world with war goods. Young folks, not in uniform, migrated to new places to find work in factories producing everything from soup to nuts. Post-war, the great birth boom ensued, giving rise to the largest generation in the nation’s history. The moniker for that glorious baby birth era is still up for grabs.
After storming beaches and building bombers, GIs born in the Great Depression ushered in a generation reveling in prosperity. These sons and daughters of the victorious allies went to college, to Vietnam, and to see Jimi Hendrix in concert. There, they fell in love, got married, and it all started again.
Generation X groved in with a mixed tape, the ’80s adorned in leather jackets and ripped jeans, mullets and big hair everywhere. The scent of Aqua Net lingered. MTV blared, declaring video killed the radio star. Atari took over, hooked to the television. Fast forward the VHS to the late ’90s, and Gen X draped itself in flannel amidst the grunge scene. CD Walkmans screamed alternative rock, while the screeching tones of dial-up Internet announced a new age. Pagers beeped. We all cared about Ross and Rachel, Y2K, and two planes hitting the World Trade Center.
Innovative progress started as newlywed Grandma and Grampa bought their first television, sent their kids to college, and marched on alongside generations. Change isn’t new; change is always renewing.
In the early 2000s, the shale revolution buzzed around the equipment industry where my old man worked. Drillers and roughnecks filled his office, renting and buying big yellow equipment for this newfangled drilling thing.
I’d chat about it with pals who couldn’t quite wrap their heads around the topic. Come 2007, when the housing market went belly-up and the stock market went south, folks were blowing up my flip phone, all curious about oil and gas. My town did a 180. Dairy farmers, once scraping pennies together, now had pockets deep as a shale well. Blue-collar folks ditched steady gigs for fat paychecks in the industry. The cool kid wasn’t the doctor’s son; it was the one apprenticing as a welder. The bottom rail was on top now.
Yet, amidst this whirlwind, a lot stayed the same. Those dairy farmers who struck it rich weren’t splurging on fancy stuff. No exotic vacations, just a shiny new tractor, paying off the farm, and sticking to the plow. The folks of the land had the same old routine – planting, harvesting, deer hunting in the fall, and a dose of church on Sundays. Republican votes and a solid work ethic – some things, no matter the cash flow, don’t change. But again, they must change.
While boomers raked in the cash from oil and gas during the shale revolution, we, the Gen Xers, were left waiting. Those stubborn baby boomers hung onto their farms and vast lands well into the 2000s, like my family’s farm handed over on New Year’s Day in 2000. The 319 acres where I grew up passed from my GI grandfather to my mother. And when the oil and gas lease was signed in 2002, my two cents wasn’t worth much – just a 22-year-old “kid” planning a marriage and a family.
Fast forward to 2023. I’m 45. I’ve raised five kids, planning my second divorce, I’m a Grandfather. Like the war years, I’m working out of town where the pay is better. And I’m still waiting for the keys to that family farm. It ain’t just me; thousands of Gen Xers are in the same boat, waiting for their shot at family legacies stretching back centuries.
But even more of us have left the small towns that we grew up in, which also benefited from the oil and gas industry. The nationwide demand for workers, compounded by the mass exodus by boomers from the workforce, means change, and a ton of it.
Now, those baby boomers who hit the jackpot with Marcellus shale checks? Well, they didn’t exactly embrace change. Most of them stashed the cash in banks, like our friendly First Citizens Community Bank in Mansfield, Pennsylvania, now spreading its roots up and down the East Coast.
But here’s the kicker – what happens when this great transfer of wealth kicks in? Does the dough stick around where the green grass grows, or does it wander off like a beagle hunting rabbits? I’m gonna break it down in the upcoming blog entries, Asbury style, sharing my expert musings on where the money’s headed as it changes hands.
Howdy! Grab your favorite coffee and join me as we journey through the Marcellus shale. I’m your guru’ for all things oil and gas. Expect some hearty chuckles as we wonder the ins and outs of the Appalachian Basin, because let’s face it, the new energy revolution is – full of surprises.
James A. Asbury