Introducing the Council

Council Co-Chairs Gay Wathen, NOV Inc., and Rod Larson, Oceaneering International

MERGING PESA & AESC RESULTS IN A STRONGER SECTOR

Council Co-Chairs Gay Wathen, NOV Inc., and Rod Larson, Oceaneering International

The 2021 merger of the Petroleum Equipment & Services Association (PESA) and Association of Energy Services Companies (AESC) was a very welcome development across the sector, given both organization’s long history of leadership in energy services. As Board Co-Chairs Rod Larson, President & CEO, Oceaneering International, and Gay Wathen, Vice President of Mobile Rigs, NOV Inc., reflected, the decision was based on the desire to unify the energy technology services sector and present a stronger advocacy voice.

“A unified sector has always been important,” Larson said. “As a representative of the industry, I think local, state and federal governments need to understand their constituents are really engaged in a positive way — providing jobs, giving back and being critical parts of the local community.”

Telling that story helps position the industry for long-term prosperity, even in a time of transformation.

“Our industry is so much about relationships,” Wathen said. “When we all come together for the same purpose, it makes us stronger. It gives us a cohesive ability to fight for the things we believe in.”

While many companies are fierce competitors in the marketplace, Larson and Wathen agreed it’s necessary for the sector to work cooperatively on issues of common concern to improve and elevate the industry.

“The general public doesn’t think of us as being one company or another,” Larson said. “It’s a shared reputation, whether it’s how we treat safety for our people, how we participate in our communities, how we treat the environment. It’s important for us to make sure we’re all successful in that regard.”

A MERGER OF EQUALS

The co-chairs see several advantages from the merger, including expanded geographical reach and complementary areas of expertise — PESA’s advocacy, workforce development and work on energy transition, ESG, and diversity and inclusion marry well with AESC’s focus on health, safety and strong relationships with regulatory agencies.

“Safety doesn’t just happen,” Wathen said. “It’s the result of diligent effort from companies across the industry and our alliance with OSHA, where we invite them to our rigs so they can see operations and provide feedback before issues become a problem.”

“PESA’s government affairs team had significant Washington influence and that carries over to the Council,” Larson said. “AESC brings great mobile representation of the core of ESG in local communities, and the chapters where local managers can jump in on things and get involved. The two organizations zippered up together very well.”

As the world proceeds in its quest for cleaner and lower carbon energy, it’s imperative for companies to take ESG seriously to position their companies in the marketplace. It’s also critical for attracting capital. 

“A year ago, John Daniel (Daniel Energy Partners) told us about a time when he was in London with an investment banker,” Wathen said. “He asked the banker to define the criteria to invest in a company, and a primary factor was, does the company have an ESG rating? If there was no ESG rating, then the company would not be considered for an investment opportunity.” 

Rod Larson, President & CEO, Oceaneering International

“So many companies are doing good things,” Larson said. “They need to tell the story to talk about the changes around safety, around environmental care, around governance, about adding diversity to our boards. We’re doing all the right things. We’re just not used to telling the story in a way that helps people understand all this.”

A TRANSFORMATIONAL TIME

As the market recovers from the downturn, challenges remain. But Larson and Wathen see positive signs.

“In the aftermarket service side, things are picking up because so much equipment was cannibalized,” Wathen said. “Now most of our customers have one hundred percent utilization for rigs they have crews for, so the big challenge is people right now. Limited capital for new equipment is putting a big emphasis on servicing.”

“Demand for oil and gas and commodity prices are both going up,” Larson said. “It’s a single digit growth kind of thing, but if feels better than last year. A lot of our members have found a way to get into renewables and some of the other adjacencies. I think those things have potential, especially with this Administration, maybe there’s some double-digit growth in those areas.”

Wathen acknowledged the difficulty companies may have investing in ESG projects or research and development but thinks it’s important because of the industry’s ubiquitous presence in economic activity across sectors.

“It’s hard because we’ve seen such a downturn,” Wathen said. “We don’t talk enough about the other products we bring besides filling the gas tank. It’s incredible the number of products made from what we produce — plastics, clothes, medication, and on and on. All of that goes away if it wasn’t for us and our industry. And you’re not going to be able to make those with sand or with solar panels. So, we have to do that education and tell people about the value we bring.”

“We’re going to need energy,” Larson agreed. “We have a growing middle class around the world, and they’re going to want more energy and a better standard of living. We can’t just go to people who are getting close to having electricity for the first time in their lives and tell them they’re going to have to wait. If there’s a gap between current supply and what the world needs, production increases are going to happen. We don’t want it be in the hands of people who are less responsible.”

With the energy industry in this period of transformation, Wathen and Larson see the Council offering significant value to members.

“It’s not an easy change, and it’s on all of us because it’s the industry’s reputation on the line,” Larson said. “We bring together committees that are impractical to form inside a single company to give each other the template. We can talk about how we did something that’s meaningful, give the report we’re putting on our website, and share best practices to help everybody move faster.”

Gay Wathen, Vice President – Mobile Rigs, NOV Inc.

“It’s about education,” Wathen said. “And we get that transparency that investors are looking for. When it comes to ESG and sustainability, even for smaller companies, this isn’t a time to sit on the sidelines but to be proactive.”

For Larson, it’s also about making the industry a more attractive career destination for the kinds of talented young people needed for the ongoing evolution.

“Another side of ESG is something we’ve been hearing from recruits who love what we’ve put on our website,” Larson said. “They didn’t know we were doing these things. When recruits are considering what they’re going to do, they’re looking for signs that this is a company where they want to be.”

Wathen underscored that the Council will continue the AESC legacy of investing in future generations. “The scholarship program for the children of members is an important way of giving back,” Wathen said. “It started small and has grown steadily through the years both at the national and chapter levels. It’s something the legacy PESA companies will be able to join in supporting and help their kids too.” (See the scholarship recipients on page 19.)

Larson hopes to see the Council will continue to help the industry grow and prosper.

“I want to see us bringing people together,” Larson said. “Leveraging the local chapters so that we’re getting twice as many people involved and the annual meeting is twice as big. I want people to see the value of both organizations coming together, and that they’re getting benefits deeper into their organizations and bringing young people in.”

The co-chairs also see long-term importance in the Council’s training, leadership and workforce development programs.

“We really saw the value the past couple years when big companies had to cut their budgets or small companies didn’t have a budget for a training program,” Larson said. “They began leveraging PESA’s training programs in DEI, ESG, and Executive Coaching at very low cost. It was a huge benefit they could provide to their teams during an incredibly difficult time for the industry.”

Wathen reflected on the future and her hopes for the Council’s leadership and advocacy.

“I would love in five years to say the Council helped to change public perception of the industry, both who we are and what we’re doing for the greater good.” 

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