Episode 181: Oil & Gas' Role in the Energy Future with Digital Wildcatters' Collin McLelland
Episode 181: Oil & Gas' Role in the Energy Future with Digital Wildcatters' Collin McLelland
Today's guest is Collin McLelland, Co-Founder & CEO of Digital Wildcatters. Digital Wildcatters is a multimedia platform that offers podcasts, videos, and in-depth blogs detailing ideas to make the oil & gas and energy sectors cleaner and more efficient. Collin walks me through Digital Wildcatters, what the media company is working on, and why oil & gas needs to evolve. We have a fantastic discussion in this episode.
As always, please consider giving us a rating or leaving a review. We heard that helps spread the word about our little show and engages more folks in the climate fight!
What is Digital Wildcatters?
Yeah, so Digital Wildcatters is actually a lot like My Climate Journey we're a media company that started off in oil and gas, and now we're in the broader energy industry, and so we have a very engaged community of energy professionals that are very forward-thinking and want to disrupt the status quo. And so got our foothold in oil and gas, that's where we got started, and that's where most of our content is made around oil and gas, and that's where most of our community comes from, but as we expand into other energy verticals we see the same challenges whether it's in geothermal or electric vehicles or distributed energy systems, there's just a lot of opportunity to create content and cultivate communities around those places. So I tell people that aren't familiar with the energy industry or media, I tell them that we're the Barstool Sports of oil and gas, it's kind of a good analogy for us. We have a podcast network, we do live events, we have a popular newsletter and we do videos and things of that nature.
It sounds like when you started, it was really kind of shining a light on what was happening in oil and gas using some of these new tools, when you say evolve or die, what made you think it's “evolve or die”? How did that perspective come about and why did that perspective come about?
Back then, I thought that there was gonna be a liquidity crunch in oil and gas, and you've seen that play out today. I thought that the private equity model was broken in oil and gas, and if you just looked at oil and gas companies, I mean, they just had a huge amount of data and they were always 10, 15 years behind Silicon valley in deploying digital technology. When you talk about like physical downhole technology of drilling a well, what we did over the last 10 to 15 years was unbelievable, but digital technology, they were behind and it's just not a way to run a company, especially when you have such a complex business model that is just filled with so many variables.
So when I first came up with that evolve-or-die tagline, that's what it was really based on, was, "Hey, you're gonna have to focus on adopting new digital technology and software that allows you to be more efficient and scale operations," and so that's like... back then, that's what it really meant, and then I think if you fast forward to today, where we're at in a 20, 21 timeframe, you look at the pressure from ESG as the world looks to find new energy solutions, oil and gas companies are back to that main point of, "Hey, you have to evolve or die, you have to move with where the world's moving to," and so I think that's kind of a timeless mantra to run by that you have to continuously be evolving.
How much was climate change on your radar when you went down this path, if at all?
I wouldn't say it was all my path at all or on my radar, it wasn't something that I was really thinking about back in the day as I was coming up the ranks, and I didn't really start thinking about climate change until, let's say, within the last two years, and really thinking about how do we transition to other energy sources while also being pragmatic about it and making sure that essentially society doesn't collapse?
I think that when you look at oil and gas, you have a lot of people that believe in climate change. I think that outsiders probably think that oil and gas workers are close-minded and they don't listen to data or facts, and there are climate deniers, which, there are climate deniers and oil and gas, but for me, it's like, regardless of climate change, one, we shouldn't put carbon up into the atmosphere, we should just be good stewards of the environment regardless, which I think a lot of oil and gas companies do think like that, but second, fossil fuels, if we talk about oil, gas, and coal, they're a finite resource, so sooner or later, we have to figure out new energy sources regardless if it's from climate change or we just have to figure out ways to power the world as we run out of other precious resources, so I would say with like within the last two years is when it really came on my radar, and I started thinking about it on a macro level when it came to energy.
When climate change first started coming on your radar, how did that affect how you thought about the future of your industry?
Yeah, that's a great question. I retweeted a senator, I think it was a senator actually from Massachusetts that said that natural gas is not clean energy, and I'm gonna preface this by saying, “what is clean energy? What does clean energy actually mean?” Because if you look at any energy source, there's pros and cons and all of them have dirty aspects to it, right, whether we're talking about nuclear fission, you have radioactive waste as a by-product or if you look at solar and wind, what do we need to have that become commercialized? We need to ramp up battery technology and production, and to do that, we have to strip mine the earth for metals, and so really looking at what is the definition of clean energy, it's actually hard to define, but when I look at the oil and gas industry, I really focus in on natural gas, I believe natural gas is "the transition fuel of the future," natural gas is the one thing that can displace dirtier coal.
We talked about the energy transition, but one thing that I really like to talk about, Jason, is that we're not really in an energy transition right now, we're in an energy addition. Energy demand keeps scaling up and wind and solar are getting added to the power mix, but they haven't displaced anything, we actually haven't even displaced coal.
If you've seen the energy crunch here over the last few weeks to a month, everyone's kicking on coal-fired plants to meet energy demand, and so when I look at the role that oil and gas plays in the energy transition, I really look towards natural gas being the transition fuel that's cleaner than coal, can displace coal, we have an abundance of natural gas in the world, so it's cheap and it's economic, it's reliable, and it's great when you add it to solar, wind and nuclear, it's a great power mix. So I think that all change happens in steps, I don't that you're gonna have a change overnight when it comes to energy because it's just impossible, so you have to do it in step changes and I believe that natural gas is the bridge to that change.
Well, I'm not a climate scientist and you're not a climate scientist, but I have to ask just given that seems like you kind of stand top of these things and take learning seriously, what's your assessment of how big a pickle that we're in as it relates to the carbon that's already up in the atmosphere and the changes that are locked in no matter what we do? How big a hole are we in?
I'm not educated enough on the topic to really go in-depth and talk about it. You can go back to the '80s, actually, I just saw a post from 1989 yesterday that talked about how the world was gonna be doing from climate change by the year 2000, and so I try not to get caught up in macro-level events that I can't control personally, and I know that there are people out there that have climate anxiety, that think about the world ending in the next few years due to climate change, and we can't personally change that, and so it's not worth being stressed and having anxiety about it, but we got to work towards solutions to make the world a better place moving forward in the future.
And so if you run off this assumption, "Okay, we have X amount, parts per million of carbon in the atmosphere, it's locked in, we can never change that," that's exactly what it is, right, we can't change it, but we can work towards a better future, and so that's how I think about it, and I also think about energy transition in like I said, a pragmatic manner of how do we do it.
There's risk, right, so either, "Hey, if climate change is as bad as some models predict that it is and we needed to remove all dependency of society on hydrocarbons today, what are the second-order effects of that?" Society collapses, and so we died regardless, [laughs] a lot of people die, and people, especially in the United States, I think that we're very privileged to have access to cheap and reliable energy and we always have, and we don't understand that there are billions of people around the world that live in energy poverty and they die as, as a result of that, and so we have to balance, "Hey, how do we make the world a better and cleaner place without also collapsing society in an irresponsible manner."
Well, and clearly a lot of good has come from fossil fuels, I mean, gosh, they essentially powered the whole industrial revolution and the lifestyles that you and I and others that have been in a privileged position to take advantage of, at what point do you think that the fossil fuel companies knew that they were essentially putting their trash in the atmosphere and it was eventually going to come back around? I've read that they've known for decades and have actively withheld that information, misled the government and the public by carrying out an active disinformation campaign. Do agree with that assessment, and how do you think about culpability there, if any?
Yeah, so, you know, when you talk about “they”, it's like who's “they”, and in this case, it could be Exxon, right, and referencing Exxon and Exxon having internal information that, "Hey, you know, climate change is real and we're contributing to that." One thing that's important to me and important for Digital Wildcatters, that I've seen as an obligation, is that oil and gas is so much bigger of an industry than Exxon. If you look at the United States, there are thousands of oil and gas companies and they look nothing like Exxon, they look nothing like Chevron and they look nothing like Shell, and so when the general public thinks of oil and gas, who do they think of? They think of Exxon, they think of Exxon hiding information about climate change, they think of BP spilling hundreds of thousands of barrels of oil into the ocean, and that's what the public image is for oil and gas.
And so when I look at like Exxon, it's like, I don't know what Exxon was thinking internally 20 or 30 years ago and the thousands of other oil and gas companies didn't either, you know, Exxon isn't a reflection of the oil and gas industry as a whole, and so whatever information they might've had, it wasn't even available to anyone else or, you know, there was nothing around it, and so when I look at things like that, like I don't think it does any good to bash Exxon today because the people that are at Exxon today had nothing to do with that, and I think if you look at like some of the work that the major oil companies do today, it's very progressive and they really support renewables.
And so I don't think that it's very constructive to go back and bash major oil companies for that type of stuff, and, you know, I think when you talk about the modern-day oil and gas industry, it's like no one really touched that, no one even knew about that stuff, we found out about that stuff when the general public found out about it. I don't identify with that, I can't relate to it at all, that wasn't me that did it and millions of people would feel that same way. So I think that people have a right to be mad about that and have anger towards Exxon, but is that productive? I don't necessarily think it's productive and is it a representation of the entire oil and gas industry? Absolutely not.
Well, when I think about the transition, I mean, you said evolve or die, I mean, it seems clear to me that one way or another things will transition over time, and I understand that everything has trade-offs, but we'll move towards a world where the externalities are factored in, mostly because we'll have to, I believe, if we want to keep the planet habitable by humans and other lifeforms that rely on it. So I guess one question I have for you is do you believe that those are the stakes, or do you think that that narrative is overblown?
I don't think the narrative is overblown, and I think that is the stakes, but when we look at energy transition, one, the general public hates energy infrastructure, it's not just oil and gas, it's not just nuclear, you're already starting to see this with NIMBYs, you know, whether it's a wind turbine farm that wants to be built and needs a transmission line ran through a neighborhood, and the neighborhoods shutting it down, and so you're going to have problems scaling out energy infrastructure regardless of the form of energy. And then also, you know, if we look at rising energy consumption and energy demand and say, "Okay, we need this to all be renewables," there are barriers to that happening as well. Like if you look at the price to produce solar panels right now, I mean, it's skyrocketing due to inflation, and so that becomes a barrier to being able to scale the technology.
And then you look at nuclear, like nuclear, everyone that I know in oil and gas is so supportive of nuclear but nuclear is much like oil and gas where it has a terrible public image, and to me, nuclear is the answer, like it's the future, and I don't know if it will ever be adopted just because of the public image that it has. And so I think that the problem is one, you have a lot of policymakers that aren't educated when it comes to energy and the physics and economics that are associated with that, all they know is, "Hey, we want wind turbines and we want solar farms," and they don't understand how our actual energy infrastructure is built and how it works and how it has to continue to work. and like I said, like, I think it's great, you add solar and wind to the energy mix.
Like I am super bullish on distributed energy, solar panels plus battery single-family homes and, you know, small commercial buildings across the US, like I do think that's the future. I do think electric vehicles are the future, and with EVs, it has nothing to do with saving the world or improving the climate, it's just that electric vehicles are a better product than internal combustion engines, and so you look at that and it's like, okay, well, EVs are a better product and they'll get adoption for that, well, now electricity demand going up, and the problem is, is that a lot of people think that electricity comes out of a wall, that [laughs] electricity actually has to be generated, and how are we going to generate that? The answer to me is natural gas and solar and wind and nuclear.
But, you know, if you look at the transition timeline of oil and gas, like when does that, when does that actually happen? Like when does the world stop using oil and gas completely? And it won't be in my lifetime, I believe that 100% and it may not even be in my kid's lifetime, I think that we're going to be that reliant, at least on natural gas, I think if electric vehicle adoption happens, the demand for oil will go down significantly, but I think that demand for natural gas will increase.
I've heard again and again and again as I've been making the rounds and talking to the smartest people that I could find since... I mean, I wasn't informed about any of this stuff coming in a few years ago, but with resounding consistency, I've heard that we already have solutions that exist today that can get us most of the way there, like upwards of 80% of the way there if we just deployed what we had, and what we're lacking is not solutions that don't exist today, it's just the political will to get them deployed as far and as wide as, as they need to, how do you feel about?
That's interesting to me, I don't really agree with that, maybe there are political barriers.. But here's the thing that I say about oil and gas companies and the role that they play in the energy transition, is that oil and gas companies are the most capitalistic companies that you'll ever find, right, and so they don't care what the energy source is, like this whole, like this whole idea that it's Exxon, Chevron and BP stopping energy transition is just complete BS, like that doesn't exist. If you look at what they're doing internally, these companies would pour money into renewables if the economics made sense for them, right, so, I don't know, like the people that you're referencing, I don’t know what they're talking about. Let's look at wind and solar, for example, the problem that we have with wind and solar right now is that we just don't have the technology yet for commercial battery capacity, and so that's the main barrier right there, I don't think it's necessarily deployment, it's just that we don't have the technology.
I told my story about growing up in the oil field [of West Texas], it's actually one of the biggest wind turbine powerhouses in the country too. People don't know this, but Texas is the number one state for wind-generated power as well, so I grew up with oil pumpjacks, huge wind turbine farms, solar arrays, like I saw it all where I grew up, and the problem is that out in West Texas, you produce X amount of gigawatts of electricity, but you can only get so much of it out and distributed across the state because it's in so much of a remote location, and so battery capacity is really the barrier there. We were talking on my podcast the other day about Bitcoin mining. Actually, I think that you guys invested in Crusoe if I'm not mistaken. Yeah, so Crusoe, great friends of mine, they're mining off of flared natural gas, so this natural gas that's a by-product of oil production that doesn't have any infrastructure to get it to a pipeline. Crusoe takes that waste in natural gas and converts it into hash rate in servers to mine Bitcoin, and I think that conversation extrapolates over renewables as well, is that, "Hey, if you have a wind turbine farm that doesn't have the battery capacity and it's generating an excess of electricity, now you can start mining Bitcoin to make that project economic." But I don't think that there are barriers from the oil and gas industry to deploying new energy projects, I mean, if they can make money on it, they'll do it and they'll be all in on it.
So rather than asking you, you know, if you could wave a magic wand and, and have the transition play out in the ideal way, I'm gonna attempt to just describe what I think your answer is based on what I've heard from you so far, and then you can just correct me where I, where I get it wrong, but it sounds like, look, climate change is a problem, but it's overblown, and it's still a problem, but it's just not as dire or as urgent as a lot of these experts are saying that it is. Energy is critical, and first and foremost, we wanna make sure that we have abundant energy to fuel the lifestyles that we've grown accustomed to and to help lift others up into those lifestyles that haven't been in them already. Government should stay out of the way, largely, and just let the market forces do their job and then we'll transition when we transition.
Yeah, I think on the government point, I don't have a strong position on that, of whether government gets involved or not. I'll tell you my ideal scenario for energy, I'd like to elaborate on that a little bit. So I think my ideal energy power mix for the world moving forward in the future, let's call it the next 20 to 50 years, are we really spend a lot of time in distributed energy with solar panels and battery technology deployed across homes, apartments, small commercial buildings. I can tell you right now, I'm looking at doing that at my house in Texas because I believe that Texas is going to continue to have grid problems over the next few years. I wanna be able to have access to sustainable energy, so I'm gonna set up a solar and battery grid at my house. I think that's the future.
I think that electric vehicles are the future in terms of being a better product, so we can essentially displace any emissions from internal combustion engines and gasoline there. In a perfect world, I think natural gas is the transition fuel. Let's take Amazon, for example. Amazon is working on electrifying their short-route fleet, so all of their delivery vehicles are being electrified and their long-haul vehicles are CNG, compressed natural gas, 'cause we're just so far away from electric vehicle on long-haul trips, so they're using compressed natural gas because the emissions over diesel engines are significant. So really utilizing natural gas in those ways, and then adopting nuclear, nuclear fusion, and then hopefully in the future nuclear fusion, I hope that becomes a thing.
And so if you look at nuclear fusion, Jason, I think that comes back to your point of governments' involvement, like governments really need to be behind a technology like fusion and dumping money into that because it's not gonna be economic for a long time, and so the R and D in that needs to be pursued. It's gonna be governments and universities that are doing that, right, so for me, that's kind of what ideal power mix looks like and then continuing to build out wind. I'm not as big of a fan of commercial solar arrays, I think solar makes perfect sense in distributed networks like on houses, I don't think it makes sense from a commercial aspect. Wind turbines, I do think make sense, so I'd love to see big commercial wind farms in that mix and then distributed solar across houses, and then I think that you do that and that leads to a significant change in carbon emissions.
Interested in coming on our show? Have a guest you’d like to hear from? Don’t hesitate to reach out! Email us at info@myclimatejourney.co.