By Oliver Klinger, Publisher
A record registration of 200 attendees marked the American Pipeline Contractors Association’s 39th Annual Convention at the El San Juan Hotel & Casino in San Juan, PR. This was on top of a record attendance at the 2009 meeting in Scottsdale.
Business session speakers included Greg Guidry, Onebane Law Firm, who spoke to regular members on the proposed labor legislation before Congress. Other speakers included Gregory Harper, senior vice president and group president of pipelines and field services for CenterPoint Energy; and Joseph Colaluca, senior vice president of Captive Resources.
Colaluca discussed the many benefits of joining or forming a captive insurance group, along with potential downsides and how to avoid them. Under a captive group, unspent premiums and reserve accounts are returned to you as dividends earn investment income. This can be substantial for companies with a good safety record. Additional insurance is purchased for catastrophic claims. Coverage includes workers compensation and liability; corporate insurance premiums must be at least $150,000 a year to qualify.
He gave an example of a captive with 285 members that one APCA member belongs to. The first $500,000 in losses is the responsibility of all the members. There is re-insurance for amounts between $500,000 and $1 million, and then a broker would provide each member an umbrella for claims above that. The umbrella is outside the program.
Greg Harper talked about the challenges of moving from a pipeline company, Spectra Energy where he was president, to a utility. This division of CenterPoint is growing and accounting for 40 percent of the company’s earnings. Several years ago, this figure was closer to 20 percent. CenterPoint is an amalgamation of the old Houston Lighting & Power, Arkla, Mississippi River Transmission System and Minnegasco. It owns no generation facilities, operating strictly as a transmission company. Its close proximity to shale gas plays along with its hub status and storage facilities have fueled recent growth.
The field services group accounted for about $100 million in revenue last year and Harper is projecting it will grow to $300 million in two years. Last year the company spent $320 million on gathering systems. Harper commented that the market driver today is the producer, who is pushing shale gas supply to market. He looks at a 28 Tcf market down the road, but feels there are some customers gone forever, including large industrial plants.
Harper feels natural gas, as the cleanest fossil fuel, has tremendous potential. He remarked about the “Clean Coal” commercials during the winter Olympics, a product “that doesn’t exist….gas is 30 percent cleaner than coal or oil.” Domestic supply projections are now at 100 years. Regulatory bills so far have ignored natural gas, instead focusing on credits to coal-fired plants. Harper said that the industry has its work cut out trying to change this, and the formation of America’s Natural Gas Alliance (ANGA) by the producers is a huge first step.
He concluded by saying uncertainty in the market and regulatory arena is the biggest problem facing the industry today. No one yet knows how things will shake out, but Harper sees natural gas as the long-term solution to our energy needs.
Stuart Varney of Fox Business News was the guest speaker. He was preceded by Pat Simpson, outgoing president, who gave a stirring address at the annual banquet.
“I hope all the members share my belief that the information taken away from these meetings, and the support from fellow like-minded contractors, is invaluable,” Simpson stressed. “In addition, the APCA’s support for the Center for a Democratic Workplace (CDW) in fighting the Employee Free Choice Act has been an incredibly useful tool in our fight against the forces of socialism fighting to take away the right of every citizen to choose the type of workplace they wish to be a part of, because in the end, that’s really at the heart of why this association was founded in the first place.
“While the nature of our conventions has evolved into a wonderful social gathering among friends and associates, the purpose for its existence has not changed. As a matter of fact, in the last 38 years since this organization was founded, the adversary that we face has not retreated, nor grown weaker, only the tactics have changed, and since the Democrats took congress in 2006 and the White House in 2008, their allies are more powerful,” Simpson pointed out.
“As we go forward into 2010 and beyond, there is a dark, ominous force gathering that we all have a duty to learn about and defend against, because if it is allowed to continue to take root, if it is allowed to grow, it’s going to destroy the very fabric that has made this country unique in all of human history.
“We have an administration that literally hates the way, and is at war with the way, this country was constituted. They are at war with capitalism and the free market system. They are at war with private property rights. They are Students for a Democratic Society (SDS) radicals, the weather underground radicals, the Black Panther radicals from the sixties that have taken over the legislative and executive branches of the government. Their methods have changed, their message has not. It’s only been couched in gentler terms of social justice, fairness, living wages, etc.
Simpson continued, “I know it’s difficult to hear it, and seems impossible to believe, but what we have going on in Washington now is the willful destruction of the American economy as we know it, and make no mistake about it, it is purposeful. Some members of this administration have described it as ‘managing the nation’s decline.’
“This next election is crucial for the future of this country, for your children, for your grand children, and for every generation to come. Everyone has to decide, is this going to be a dynamic growing free market, freedom loving country, or a mediocre, has-been, declining socialist democracy in the model of failed European states?
Simpson closed by stating “I can’t stress enough the importance of getting involved, doing the research, educating yourself on these matters, making the hard choices, and doing what we can as an organization and as individuals to make sure this country remains the richest, freest nation in the history of mankind.”
New officers, directors
Officers elected for 2010 are: Wayne Stringer, president, Troy Construction Inc., Abilene, TX; Kevin Cater, vice president, Ledcor Pipeline, Houston; 2nd vice president, John Fluharty, Mears Group Inc., Rosebush, MI; and Bruce Gilliland, retired pipeliner, secretary/treasurer. J.D. Lormand remains as executive director at the association’s office in Lafayette, LA.
Other directors are: Pat Simpson, Sterling Construction Co., Sterling, CO; David Dacus, Troy Construction Inc., Houston; Randy Farrar, Farrar Construction Inc., Dover, OK; Max Nichols, Jomax Construction Co. Inc., Great Bend, KS; Mark O’Roke, Sunland Construction Inc., Eunice, LA; Bill Schettine, Meridien Energy LLC, Falconer, NY; James Driver, Driver Pipeline Company Inc., Dallas; and Sean Sullivan, Elkhorn Construction, Evanston, WY.
The associate member board consists of: Scott Jeter, president, PipeLine Machinery International, Houston; Joe Trapani, vice president, Caterpillar, Houston; John Graham, secretary/treasurer, Houston; Carl and Sonnie Raffety, convention chairpersons, Cross Country Pipeline Supply, Houston; and Bobby Darby, Darby Equipment Inc., Tulsa, OK as golf chairperson.
Next year’s annual meeting is scheduled for March 2-6, in San Diego. For information on APCA contact J.D. Lormand at (337) 278-0056 (www.americanpipeline.org) or Wayne Stringer at (325) 676-8214.