PTTC Relationship Under Study

It is “State Fair” season again in the United States – a time to eat bad fried food and ride wild carnival rides (and hope they were properly inspected).

As in previous years, I always look for the newest “health” food on a stick. Last year they introduced deep fried garlic mashed potatoes on a stick.

This year they finally reached for the ultimate – deep fried butter on a stick! I thought, “Why not just inject grease directly into my arteries?”

This year I decided to reflect on my health and did not try this latest culinary delight.

There are certain times in life and in business to stop and reflect on the current reality and contemplate the future. AAPG is in this process with President Rensink’s request for the Association leadership to consider what AAPG will look like well in to the future – even to 2035.

As part of this evaluation we are examining the effectiveness of all of AAPG’s major programs. Recently, the Executive Committee, Advisory Council and the AAPG directors were asked to force rank AAPG’s top 25 programs. In addition, we made an independent audit of several programs to better understand the needs and demands of the membership.

One program we are evaluating is AAPG’s relationship with the Petroleum Technology Transfer Council, or PTTC. In 2006, PTTC needed to renew its Department of Energy (DOE) funding, and AAPG was approached for a potential relationship to stabilize PTTC and help its board find new funding.

Since 501c(3) not-for-profit corporations cannot be purchased, AAPG agreed to become the sole member of PTTC. This initial agreement was for a three-year trial period.

The mission of PTTC is to provide education and training to small producers, independents and consultants. This is primarily accomplished by providing base funding to Regional Lead Organizations (RLOs). RLOs typically are universities or state government agencies.

The first phase of the business plan for reconstructing PTTC was to re-establish DOE funding. In the event of a budget shortfall AAPG agreed to support PTTC up to $300,000 the first year or until DOE funding could be established.

The second phase of the business plan was to secure funding from industry and private sources. This was critical to ensure PTTC was not totally dependent on government funding. Another key item was to secure support from another not-for-profit society.

The first phase went very well with DOE. AAPG and the PTTC leaderships were able to secure two major contracts from DOE for a total of $5 million over five years. However, there was one critical change from previous funding, in that DOE required a very specific scope of work related to DOE activities, which limits PTTC’s flexibility in the workshops and other programs that it offers.

When the DOE PTTC program was started in the early 1990s the plan was for industry to take over funding after five years; however, industry funding was never enough to support the program. For the past three years several attempts were made to secure industry and private funding. Although there have been several very generous donations from individuals, general industry support has been limited.

For society support, the Society of Petroleum Engineers was asked to join AAPG in a joint partnership. SPE declined the offer.

The reality is PTTC is essentially a program primarily funded by the government with limited funding from industry and individuals.

Now we are at the end of the three-year trial period and it is time for AAPG to evaluate its long-term relationship with PTTC. The key metrics will be the overall benefit to AAPG members and the potential liability if DOE funding is cut, stopped entirely or if the scope of work is changed considerably.

As a result, on Oct. 9 at the GCAGS meeting in San Antonio, the AAPG Executive Committee formed an ad hoc committee to make a recommendation concerning AAPG’s future involvement with PTTC.

There are three likely outcomes:

  • Continue the current relationship.
  • Separate but work together through a joint venture agreement.u Divest and provide general support.

We will let you know before the end of the year the recommendation of the ad hoc committee. Also, we will be looking for response from the membership so please send us your opinion at please send us your opinion

Before I left the state fair this year my 10-year-old daughter, Zoe, tried a chocolate pickle on a stick. She loved it; I thought it was gross.

I think I will stick to corn dogs.

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Director's Corner

Director's Corner - Rick Fritz
Richard D. “Rick” Fritz, an AAPG member since 1984 and a member of the Division of Environmental Geosciences and the Division of Professional Affairs, served as AAPG Executive Director from 1999 to 2011.

The Director's Corner covers Association news and industry events from the worldview perspective of the AAPG Executive Director.

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