Interview with the president of Trueblood resources John Trueblood, an awesome person and top notch independent operator shot on locations at NAPE 2015. To learn more about Trueblood Resources click here. And to learn more about NAPE click here.
Mark: Hey, folks let’s learn something new about the oil and gas industry.
All right. We have a series of three interviews that we shot at NAPE and you may go, “Mark, what is NAPE?” Well, NAPE stands for North American Prospect Expo and it’s one of our favorite shows of the year. There’s actually a bunch of them going throughout the year, but this one is actually the one that was in August 19th to 20th in Houston of 2015.
Now, the reason that we love NAPE, it’s the only show we know where deals are actually done on the floor. It is a show for upstream oil and gas, operators, and landmen, but it’s also a great place to learn about what’s going on in the industry. So, if you have an interest in the oil and gas industry or upstream or operators, you need to make plans to go to NAPE. We go every year, it’s a great show, so hopefully these three interviews help to get a feel for what’s going on. Enjoy.
Mark: So, early morning here at NAPE, we’re sitting here with John Trueblood. Hey, John.
John: Good to see you. I’m glad to be here.
Mark: Yeah. And so, you are a family-owned business, Trueblood Resources, right?
John: Yes, sir. That’s correct. And so, we started – well, it was originally my company. My background, I started with major oil company, Amoco who no longer exist now.
Mark: Yeah. You’re dating yourself when you say Amoco.
John: Yeah, right. So, they’re bought by BP. I started with them in 1980. And then, in ’88, left Amoco and formed Trueblood Resources. So, we’re a c corp, very small, right now there’s five of us. The largest we’ve even been is I think is eight. So, we’re a really traditional oil and gas operator and change a lot now, there’s not – there’s not a lot of those left really potentially.
And now, I brought my father sort of more active in the business about fifteen years ago. He was actually at public companies and he sold his last public company that – one – [Pioneer] was one of them and [Semerex] the other and I said, “Father, you need to be at the office working,” so he still is. So, that’s why it’s still right sort of more family company.
Mark: And the thing that I love that y’all do, you aren’t just an operator, you don’t get immersed into the local communities and local population. Can we talk a little bit about that?
John: Yes, we sure can. So, my background was land originally at Amoco. And fortunately, Amoco was a really tidy place to get excellent experience, so one of my goals at Amoco was to learn everything I could, so I spent a lot of time with engineers, a lot of time with the geologists, geophysicists, and regulatory attorneys. So, ultimately when I formed my own business, I sort of have to wear a lot of hats. So, I went from being really sort of a business guy to more technical, so I’m kind of a quasi.
So, I always have the understanding how important it was to reach out when you’re doing business to whoever you’re doing business with. And one of the things that I saw consistently in Oklahoma which I only worked my last two years in Amoco, but I saw – it was a very mature year, it had produced oil and gas for many, many years, but I’d still saw that there was a little bit of this oil here and local land owner there and yet, we really had so much in common because it’s their minerals. I could pick my rig up and I could take it to another county, I could take it another state, but their minerals are there and how they find somebody to husband their assets, I thought was critical.
So, my – and I frankly didn’t have any money, I still don’t have any money. And so, rather than just come in with a lot of money and frankly here’s money and not telling you the whole story, well, I sat down and I said, you know here’s our plan, I mean here is what we see not only technically, but here is how we’re going to operate, here is how we’re going to surface and, not only did I start and spent a lot time doing this. So, rather than just showing up present him a letter and a lease and some money, I sat down with them and showed them the play.
And originally, how I handed that idea was again, because of really lack of financing, I wanted to put my money into drilling. So rather – and I said to the landowners and I think it’s somewhat still the same, when I buy a lease from you, it’s just another opportunity to drill dry hole.
Now, today with horizontal drilling, it’s a little different. And we, our company targets original or vertical production that has produced our targets that it produced for many, many years vertically. So, it’s not really exploratory, but the risk is I think still here in this business.
So, I would sit down with the landowners, describe our history, describe the company, and we’d actually look at what the plan was. So, we’d, you know, here’s why we think there could be oil, here’s our – here’s our vision. And, you know, I’m not sure, you know, a lot of times people didn’t want to do that, I think because they’re worried about the proprietary part of it, I just, you know, I took the risk and said, listen, it’s challenging I still think to fight commercial oil and gas.
My father – forget about me, my father, he’s done a long time. And so, to show them really the risk that we’re taking, the importance and they, I think the ones particularly the landowners I found that had had some production understand the real value, so it wasn’t just how much money I’m getting upfront for doing the deal, it was really who am I going to do business with.
And then, the other part that I always have done with them as I said, you know, if I got run over by a truck or, you know, because we’re small maybe it’s me, but if the property or the lease that we have it’s a sign which is common, we always have partners and I tell them that that we typically would operate less now, but – but I said, you know, we always get partners. So, I want you to have a really good piece of paper, a really fair piece, I don’t care if it’s, you know, the widows and orphans, if you will that don’t understand. I mean in this age it’s very sophisticated, so many have counsel that’s involved and even the attorneys started to recommend our company because essentially it was very simple we did what we said we’re going to do.
Now, I put it in writing too because again, so they had a nice piece of paper. So, what I saw sometimes is people would come in or different companies and they’d get a form of lease that was probably more in their favor and they just pay more money and so, the owner would not really worried about it as much, but ultimately if that lease produces it may be there for forty years or longer. I mean I’m doing business in areas that have produced since the 1960’s, so that’s over, you know, sixty years almost.
So, that’s – that’s — we did it for the two fundamental reasons. One, we thought it was appropriate and correct. Two, it also in the long run when I established that close relationship to them early, when I needed something later because things always change whether it was access to water or a pipeline or we needed more time or different zones no longer be covered by the lease and I had another idea and I wanted to come back and try it, they would say, okay, you know, because I would communicate. So, that’s how we really develop that basic idea.
Mark: So, you basically just did good fair business and you’re transparent about this and you basically partnered with the landowners instead of them being a resource to you?
John: Yes. The – my goal is still my goal, I’m going to be there next week and there’s one fellow named, [Harry Wonger] another [Kenton Burgess], they’re locals I think it’s called Fort Supply. And I will see them next week and we’re working on a very innovative [play coal] as we go now, but it’s produced many years of limestone vertically. And, we’re struggling particularly now with the oil prices to really encourage partners to join us and experiment and there is beginning to be some hard data that’s showing to be a pretty exciting opportunity.
But, for them, you know, one of my goals has been because they were very cooperative in working with our company and allowing us enough time on the leases because I said I might have this idea today, but I will assure you that it’s going to change and then, I will need time, but here is the plan and here is what I ultimately see in your area as far as the future potential technically for more oil and gas to be found.
And so, my goal, yes, was to treat them more like a joint venture partner and rather and it’s not us against them, you know, oil versus the owner, we make our – we both from the commercial standpoint we’ll both make our money at the well head, they get a royalty and they don’t have the risk, but it’s their land.
John: And I respect that it’s their land and I said to them when you do a deal with our company or you do a deal with somebody, just partner up with somebody you think ultimately is going to husband your assets. And again, the leases, you know, sign and sold and lot of things happen, but get something that’s – that started because again, we’re more incubators.
Again, we’re small company, we have limited capital, we have a lot of technical expertise, we’re niche players, we’ve been this five-county area in Oklahoma for twenty five years and developing local knowledge not only sub surface on the geology, but then logistics and relationships and, that still our model.
And then, the challenge as well as opportunity is how do we bring that into – who needs to do what we do because the incubating side of this business is I think it’s coming back, I think with the “shell place” probably by now ten years plus old. I think some of the fundamentals became more apparent over time depending on the basin you were in that the fundamentals is my partner who once said or my Amoco buddies my old buddy said, the fundamentals of source seal and trap, in other words what geologic fundamentals allow it to actually be commercial.
And so, that’s, you know, it’s been a combination, but again, the – that part of our business is fundamental and consistent that is communicating, working, and as you said being transparent. But, it’s really simpler than that, it’s just it’s more fun it’s more it’s just better, it’s more appropriate and I think people respect that.
Mark: Yeah, they do. And y’all doing a really great job in Oklahoma. Let’s change subject real quick. You and I have something in common, we both mentor students. How did you get into that?
John: Well, my father – he’s an interesting man, Harry Trueblood. He’s 90 now. He’s a petroleum engineer by training. He is from Childress, Texas. He grew up with minimal resources financially, in fact, at some point they are basically very poor. And he was fortunate enough after World War II, he was in the Pacific. He had a GI Bill and went to college. He’s very driven human being, very entrepreneurial. You know he’s the founder of [Vale], some people know where [Vale] is and he did this other resort called [Prince Phil] in Hawaii and he’s been involved in seven public companies he founded and so, very entrepreneurial fellow.
But, he attributed much of his opportunity to education. And although, you know, we’ve got a lot of dimensions to us, you know, business, spiritual, educational, academic, but fundamentally I think both he and I agree that one of the few solutions we found to change lives is education. And, he essentially had the philosophy that and he had some real financial success in his businesses, but all his money is in a foundation called Harry Trueblood Foundation and his goal was to educate his children to the best ability they can qualify for and then expect them to make a living and we basically give our money away.
And, he’s just a very – he’s a generous man, so I think part of the training if you will as a child of generosity, not only just financial but time, your spirit was where it started. And then, I had the fortune and, you know, I was pretty up and down in our business right now it’s tough as nails, but we’ve had some success financially and I just, you know, have enough stuff, I just wanted to give my time and money away.
And so, it was – it’s all level, I – it’s really academically based secondary schools, some primary schools, and colleges. And that’s really what got me in the mentoring and the students whether – I mean the little kids you play with, the teenagers are pretty complex, but you can touch their heart. And the college kids, you know, they’re too many have some ambition eventually looking for jobs they’re eventually looking for internships and they’ve been extraordinarily appreciative of the time and the information and the sharing as well as scholarships.
So, both me personally and my father, we’ve been involved in scholarships for many, many years and also the arts, more me than my father. Our goal is there’s a lot of different aspects of education, the arts being, you know, ballet, symphony, theatre and so, that’s essentially all our money and time are now are coursing. My father said he said the portfolio of the foundation was pretty beat up in my, you know, I do separate from the foundation as well. We’re pretty beat up right now, but we will be back and I tell all the folks that we get involved with that, you know, we’re committed. And so, we – we just believe that it really changes lives.
Mark: Yeah. John, thank you so much. It’s great that you’re giving something back. We wish you much success in your business and thanks for spending time with our audience.
John: All right. It was super fun and I’ll look forward to visiting with you more.
Mark: So, folks I hope this helped. We will see you next time.