# OKCpedia > Businesses & Employers >  Tapstone Energy (Tom Ward)

## GoThunder

Tom Ward launches OKC energy company | News OK

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## OKCisOK4me

“Usually my ideas tend to be larger than my pocketbook,” Ward said.

Well, hopefully, that doesn't get him in trouble this go round!  Thanks for staying in OKC though.  Wish him much success!

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## ou48A

> “Usually my ideas tend to be larger than my pocketbook,” Ward said.



 Well isn't everybody's thoughts and ideas bigger than their pocketbook?

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## GoThunder

He will start out funding the business with his own cash so maybe he'll be a little more careful...? Then again maybe not...

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## catch22

SandRidge wasn't unprofitable. It just wasn't making enough money for the investors. So they ousted him.

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## PhiAlpha

> He will start out funding the business with his own cash so maybe he'll be a little more careful...? Then again maybe not...


He bought Riata with his own cash and turned it into Sandridge.

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## OKCisOK4me

> Well isn't everybody's thoughts and ideas bigger than their pocketbook?


Sure...and I'm sure he'll eventually find partners to invest in this new company with him. I just thought that in light of his recent negative press that it was kinda funny. Try to see the humor in it..

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## Praedura

Tapstone. What a cool name.

After all, that's exactly what an oil company does -- tap the stone.

The more I look at it, and say it, the more I like it. Really rolls off the tongue. Tapstone. That's just a great name for an energy company.

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## Plutonic Panda

I wish him the best of luck!

With a name like Tapstone, a very cool tower could be crafted  :Wink:

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## OKCisOK4me

> I wish him the best of luck!
> 
> With a name like Tapstone, a very cool tower could be crafted


I don't know if you've heard of the movie 'The Neverending Story' but there's this huge rock creature with a one man steam roller and I wonder if he met a rock woman and they fell in love would he Tapstone?

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## OklahomaNick

Maybe Aubrey and Tom leaving their companies and starting new businesses was a GOOD thing for the OKC business environment. I am sure they have aspirations to grow their companies thus creating good jobs in OKC. I don't think they have aspirations to grow their companies to be the size of CHK & SandRidge, but  more companies = more jobs.

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## PhiAlpha

> Maybe Aubrey and Tom leaving their companies and starting new businesses was a GOOD thing for the OKC business environment. I am sure they have aspirations to grow their companies thus creating good jobs in OKC. I don't think they have aspirations to grow their companies to be the size of CHK & SandRidge, but  more companies = more jobs.


As long as nothing that happens at SD and CHK results in either of them relocating out of OKC, you're exactly right. Either could sell out and retain a massive presence here, not necessarily the best scenario but not terrible. If either sells out and doesn't remain here, hopefully their new ventures will help fill the void eventually. 

As far as size aspirations, I wouldn't put anything passed them. AEP already is nearing 90 employees and they're "Still Hiring". That's after only being open for a little over 6 months. I know for a fact that they have been leasing like crazy in the Utica since around the middle of July, and knowing Aubrey, there is no reason to believe he will stop anytime soon or with the Utica. They may not ever have 13,000 employees, but being the size of Sandridge at minimum or as large as CHK's exploration wing (5 to 6,000 people) in a few years is not out of the realm of possibility. I just hope AKM has learned a little from his last experience. If they stay private, it will probably be closer to SD size but if they go public and are disciplined, you never know. Same goes for Tom Ward.

Here's to the result being 4 strong mega energy companies.

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## onthestrip

> SandRidge wasn't unprofitable. It just wasn't making enough money for the investors. So they ousted him.


I cant remember what their balance sheet looked like but the stock was in the tank and Tom was self dealing and looting the company...thats more of the reason of the shareholder revolt.

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## PhiAlpha

> I cant remember what their balance sheet looked like but the stock was in the tank and Tom was self dealing and looting the company...thats more of the reason of the shareholder revolt.


The shareholders greatly exaggerated the situation at Sandridge, but just like AKM at CHK, there were some areas in which Tom Ward wasn't doing a very good job of running the company. Some of those aspects were the reason for the low stock price, it also didn't help that their infrastructure in the Miss wasn't in place and they are just now beginning to harness the full potential of the play. There were also some areas in which he did well. The strategy they're following now isn't much different than the one Ward set forth before he was pushed out, they've just become a lot more cost conscious and have cut a lot of the extracurricular expenses. I do think selling most of their permian assets to fund drilling in the Miss was relatively stupid given what's going on down there now, but hindsight is 20/20. On the positive side, under Ward, they built the largest position in the Mississippi play and have developed the infrastructure to make them one of few companies that can drill some portions of the play economically. 

I think the market had taken such a dim view of Ward that they could've discovered the next elephant field and their stock would've stayed in the tank. It appears that both ousting Ward and finally getting some decent returns from the Miss have helped it over the last month or so.

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## kevinpate

Tapstone -  an interesting name.  Sort of conveys a light but noticeable knock on someone's left rock.

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## Just the facts

He won't be going public.

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## Teo9969

Why not?

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## PhiAlpha

> He won't be going public.


Never say never, but you would have to think that he wants to avoid it right now. Things change though.

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## Just the facts

If you read the article he made it pretty clear he has no interest in doing that again.

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## Pete

Another "I'm hearing"...

Hearing that Tom Ward is in the process of massing a pretty considerable enterprise that will require a decent amount of office space, and that he is actively negotiating on a couple of downtown locations.

He's always been more low profile than Aubrey McClendon but from all reports his new company will be a force to be reckoned with.

Looking forward to yet another significant OKC-based business with well-paying jobs.


BTW, it also seems the ship has been righted at SandRidge.  People that work there tell me things have settled down and stabilized and morale is on the up-swing.

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## Teo9969

> Another "I'm hearing"...
> 
> Hearing that Tom Ward is in the process of massing a pretty considerable enterprise that will require a decent amount of office space, and that he is actively negotiating on a couple of downtown locations.
> 
> He's always been more low profile than Aubrey McClendon but from all reports his new company will be a force to be reckoned with.
> 
> Looking forward to yet another significant OKC-based business with well-paying jobs.
> 
> 
> BTW, it also seems the ship has be righted at SandRidge.  People that work there tell me things have settled down and stabilized and morale is on the up-swing.


AEP considerable?

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## PhiAlpha

Well they currently have 8 employees for what it's worth and don't currently have any properties, they are looking though obviously. Aubrey started off with 2.5% interest in every unit CHK drilled for his employees to manage and was able to obtain some major financing relatively quickly. Tom Ward has a lot of those 2.5% interests from his time at CHK but I'm not completely sure he's managing them (at least it doesn't sound like it). He might have passed them down to WCT Resources. If Tom can obtain the crazy amount of $$$ that Aubrey did, I'm sure they will scale up pretty quickly, just maybe not as much as AEP.

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## onthestrip

> Well they currently have 8 employees for what it's worth and don't currently have any properties, they are looking though obviously. Aubrey started off with 2.5% interest in every unit CHK drilled for his employees to manage and was able to obtain some major financing relatively quickly. Tom Ward has a lot of those 2.5% interests from his time at CHK but I'm not completely sure he's managing them (at least it doesn't sound like it). He might have passed them down to WCT Resources. If Tom can obtain the crazy amount of $$$ that Aubrey did, I'm sure they will scale up pretty quickly, just maybe not as much as AEP.


Dont have any properties? WCT was buying mineral and/or lease rights in the same area Sandridge was, in the Mississippian area I believe. I was thinking it was like 500,000 acres.

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## PhiAlpha

> Dont have any properties? WCT was buying mineral and/or lease rights in the same area Sandridge was, in the Mississippian area I believe. I was thinking it was like 500,000 acres.


WCT has properties, Tapstone does not.

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## Snowman

What a difference one year makes

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## Pete

Shell Oil sells Kansas assets to firm started by former SandRidge leader
By Dan Voorhis
The Wichita Eagle
Published Thursday, Feb. 20, 2014, at 9:22 a.m.

Tapstone Energy, a new firm formed last year by former SandRidge Energy founder Tom Ward, has bought all of Shell Oil’s assets in Kansas, according to information from Shell Oil.

The assets include 45 producing wells and 600,000 acres of leases in Barber, Harper, Kingman, Pratt, McPherson, Sedgwick, Sumner, Rice and Reno counties.

The transaction is expected to be completed in March.

The terms of the deal were not disclosed.

Read more here: Shell Oil sells Kansas assets to firm started by former SandRidge leader | Wichita Eagle

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## PhiAlpha

> Shell Oil sells Kansas assets to firm started by former SandRidge leader
> By Dan Voorhis
> The Wichita Eagle
> Published Thursday, Feb. 20, 2014, at 9:22 a.m.
> 
> Tapstone Energy, a new firm formed last year by former SandRidge Energy founder Tom Ward, has bought all of Shell Oil’s assets in Kansas, according to information from Shell Oil.
> 
> The assets include 45 producing wells and 600,000 acres of leases in Barber, Harper, Kingman, Pratt, McPherson, Sedgwick, Sumner, Rice and Reno counties.
> 
> ...


Had a feeling that would happen. Tom really loves the miss,

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## HangryHippo

> Had a feeling that would happen. Tom really loves the miss,


Isn't it a play that's not very good though?

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## Bellaboo

> Isn't it a play that's not very good though?


The way I understand it, it will produce a lot of water with the oil. I also read that they have developed better fracking techniques that have reduced the water output and increased the oil.

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## PhiAlpha

> The way I understand it, it will produce a lot of water with the oil. I also read that they have developed better fracking techniques that have reduced the water output and increased the oil.


Yep, produced water is an issue for the miss. The biggest hurtle is building infrastructure to transport and dispose of it (or inject it). A few companies that have legacy acreage in the play area own secondary recovery units in which water is injected to increase oil production in fields that have been depleted. Those companies have the infrastructure and a use for the water so it makes it much easier for them to handle. It also helps to have a fairly large acreage position that helps justify building that infrastructure on a massive scale (ex. Sandridge and CHK). Outside of the core areas the play isn't very consistent (which is why some take issue with calling it a "resource play" like the bakken shale or SCOOP). It's great in the core areas but outside of those areas it's spotty and makes the cost of building infrastructure uneconomic with out a large position to spread out the cost. Infrastructure isn't as big of deal in Oklahoma as the area has produced heavily for 50 - 100 years, but it is a much bigger issue in Kansas where that hasn't been the case. Electrical infrastructure is also an issue, again, not as much in the OK part of the play, but definitely in parts of Kansas. Shell failed because they took the red tape constricted costs of a major and spent way more then necessary to drill normally shallow horizontal wells (spending $8 - $10 million to drill wells that should cost between. $2-$3.5 million). With the acreage that WCT Resources has up there, plus the Shell acquisition, I'm sure Tapstone has the resources to make it work.

Sorry for the long winded, likely error filled post. Tough to review this from my phone.

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## HangryHippo

> The way I understand it, it will produce a lot of water with the oil. I also read that they have developed better fracking techniques that have reduced the water output and increased the oil.





> Yep, produced water is an issue for the miss. The biggest hurtle is building infrastructure to transport and dispose of it (or inject it). A few companies that have legacy acreage in the play area own secondary recovery units in which water is injected to increase oil production in fields that have been depleted. Those companies have the infrastructure and a use for the water so it makes it much easier for them to handle. It also helps to have a fairly large acreage position that helps justify building that infrastructure on a massive scale (ex. Sandridge and CHK). Outside of the core areas the play isn't very consistent (which is why some take issue with calling it a "resource play" like the bakken shale or SCOOP). It's great in the core areas but outside of those areas it's spotty and makes the cost of building infrastructure uneconomic with out a large position to spread out the cost. Infrastructure isn't as big of deal in Oklahoma as the area has produced heavily for 50 - 100 years, but it is a much bigger issue in Kansas where that hasn't been the case. Electrical infrastructure is also an issue, again, not as much in the OK part of the play, but definitely in parts of Kansas. Shell failed because they took the red tape constricted costs of a major and spent way more then necessary to drill normally shallow horizontal wells (spending $8 - $10 million to drill wells that should cost between. $2-$3.5 million). With the acreage that WCT Resources has up there, plus the Shell acquisition, I'm sure Tapstone has the resources to make it work.
> 
> Sorry for the long winded, likely error filled post. Tough to review this from my phone.


Much appreciated.  Thanks for the insight.

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## PhiAlpha

> Much appreciated.  Thanks for the insight.


Anytime

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## PWitty

> Yep, produced water is an issue for the miss. The biggest hurtle is building infrastructure to transport and dispose of it (or inject it). A few companies that have legacy acreage in the play area own secondary recovery units in which water is injected to increase oil production in fields that have been depleted. Those companies have the infrastructure and a use for the water so it makes it much easier for them to handle. It also helps to have a fairly large acreage position that helps justify building that infrastructure on a massive scale (ex. Sandridge and CHK). Outside of the core areas the play isn't very consistent (which is why some take issue with calling it a "resource play" like the bakken shale or SCOOP). It's great in the core areas but outside of those areas it's spotty and makes the cost of building infrastructure uneconomic with out a large position to spread out the cost. Infrastructure isn't as big of deal in Oklahoma as the area has produced heavily for 50 - 100 years, but it is a much bigger issue in Kansas where that hasn't been the case. Electrical infrastructure is also an issue, again, not as much in the OK part of the play, but definitely in parts of Kansas. Shell failed because they took the red tape constricted costs of a major and spent way more then necessary to drill normally shallow horizontal wells (spending $8 - $10 million to drill wells that should cost between. $2-$3.5 million). With the acreage that WCT Resources has up there, plus the Shell acquisition, I'm sure Tapstone has the resources to make it work.
> 
> Sorry for the long winded, likely error filled post. Tough to review this from my phone.


Very well said. That's exactly how I understand it to be as well.

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## Pete

Ward just sold his ownership interest in the Thunder to George Kaiser of Tulsa.

Looks like he is going all-in on Tapstone:




> “I am very pleased to have been a part of the group that brought the Thunder to Oklahoma City,” Ward said. “The team has generated tremendous excitement in our city and state. This transaction allows me to have greater focus on the things that I know and care about the most, which include launching new Oklahoma-based energy companies and supporting charitable organizations that demonstrate compassion to those in need.”


George Kaiser buys Thunder stake | News OK

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## s00nr1

So now we have Kaiser (BOK) and Records (MidFirst). Interesting.

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## Pete

^

Although that article also says that Records has lessened his investment.

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## lasomeday

> ^
> 
> Although that article also says that Records has lessened his investment.


This is a good thing.  It taps into the wealth of the old money in Tulsa.  It also ties the Thunder to the state more.

I also am seeing Tapstone on a big hiring blitz.  They are growing quickly.  I hope they don't take the same stance they did with Sandridge tearing down buildings left and right in Bricktown!

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## HangryHippo

> ^
> 
> Although that article also says that Records has lessened his investment.


The article stated he was still a "significant owner."  I wonder how much he reduced his interest?

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## Pete

Just remembered that when Ward was starting Tapstone, he borrowed money from Kaiser with his ownership share of the Thunder as collateral.

Wonder how that may have played into this recent transaction.





> To help finance Tapstone,Ward secured a private loan for his new venture from Tulsa oilman George Kaiser, and documents filed in September with the Oklahoma County Clerk indicated that Ward used proceeds he received from his stake in the Oklahoma City Thunder, the NBA basketball team, as collateral for a private loan; the amount was not disclosed


Tom Ward Takes Helm of Another E&P | 2013-10-22 | Natural Gas Intelligence

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## Pete

Tapstone is applying for incentives through the City's quality job creation program (GOLT).

Their application shows they currently have 35 employees but will add at least 150 more in the next five years at an average salary of $146K.

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## onthestrip

> Tapstone is applying for incentives through the City's quality job creation program (GOLT).
> 
> Their application shows they currently have 35 employees but will add at least 150 more in the next five years at an average salary of $146K.


That sounds like a hard to believe average salary. But the higher the salary they claim, the higher the quarterly cash payments the state starts giving them. Gotta love free market capitalism...oh wait...

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## catch22

They have to provide proof of employment and payroll.

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## David

> That sounds like a hard to believe average salary. But the higher the salary they claim, the higher the quarterly cash payments the state starts giving them. Gotta love free market capitalism...oh wait...


1. The oil & gas industry pays well.
2. Do you really think the state won't take it's money back if it comes out that the application was made of lies?

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## PWitty

> That sounds like a hard to believe average salary. But the higher the salary they claim, the higher the quarterly cash payments the state starts giving them. Gotta love free market capitalism...oh wait...


When you're a startup company the majority of your positions are going to be, for the most part, very technical (geology, engineering, IT). There aren't near as many administrative-type positions that generally don't pay as well. Therefore, the average salary is going to be pretty high. Plus, when you're a startup you want to hire people with experience and that experience is going to command a higher wage than the engineers/geologists who are fresh out of school.

And like the others said, if they can't provide proof of salaries that high then Tapstone will lose their incentives.

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## Pete

Yeah, the way this program works is they set targets then report at least annually.

If you don't hit the targets, your payout is reduced or not paid at all.


One of the downsides is that when a company gets paid over several years then does a massive layoff (like Chesapeake) that job creation money is not returned.

CHK missed it's last deadline and I really wanted to see their FTE count in OKC and compare it to January 2013 when they last reported (4,700).

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## Bellaboo

> *That sounds like a hard to believe average salary*. But the higher the salary they claim, the higher the quarterly cash payments the state starts giving them. Gotta love free market capitalism...oh wait...


I know a geophysicists in Tulsa who works for Cimerex that makes $365,000 salary per year.

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## Just the facts

Not all the jobs will be part of calculation, only the highest paid 150.

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## Rover

> Not all the jobs will be part of calculation, only the highest paid 150.


Do you know that or are you just being cynical again?  What jobs don't count?  Are you accusing them of lying?

They are claiming to add 150 new jobs and you say they are only Counting the top 150, or 100% of the jobs?  That's deceitful?  LOL

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## Urbanized

By the way, $146K ain't what it used to be. It's not like everyone making that will be driven from their country estates and be delivered to the new building in their Rolls Royces. Great incomes, fantastic addition to OKC, downtown and Bricktown, but that salary range is hardly shocking for quality energy sector jobs, especially in a company that is expressing publicly that they intend to run lean and mean. It's incredibly positive to have these folks land in this district.

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## DoctorTaco

> By the way, $146K ain't what it used to be. It's not like everyone making that will be driven from their country estates and be delivered to the new building in their Rolls Royces. Great incomes, fantastic addition to OKC, downtown and Bricktown, but that salary range is hardly shocking for quality energy sector jobs, especially in a company that is expressing publicly that they intend to run lean and mean. It's incredibly positive to have these folks land in this district.


Hopefully Tom Ward finds a way to recruit from outside the metro, instead of just poaching from the already stretched thin technical workforce here in OKC (cough, AEP, cough).

We need a bigger talent pool of engineers/geos, is what I am saying. On the other hand as long as everyone keeps robbing Peter to pay Paul in terms of employees and all the employers have to keep up with Aubrey in terms of salary, it is a huge $$$ win for those of us in the industry.

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## Rover

Pay at top energy companies in Houston still generally a fair amount higher.  But , it is improving in OKC and is part of the reason we are seeing a good in migration at this time.

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## Just the facts

> Do you know that or are you just being cynical again?  What jobs don't count?  Are you accusing them of lying?
> 
> They are claiming to add 150 new jobs and you say they are only Counting the top 150, or 100% of the jobs?  That's deceitful?  LOL


I am basing it on my own personal experience with similar programs here in Florida.  We didn't count the lower paying jobs because it brought the average down and we only submitted the highest paying jobs for the program.  Thinks about it, if they end up creating 151 positions which one do you think they will not report?  Answer, the lowest paying one.

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## Plutonic Panda

> Pay at top energy companies in Houston still generally a fair amount higher.  But , it is improving in OKC and is part of the reason we are seeing a good in migration at this time.


Not trying to argue with you and I actually agree, but remember cost of living is significantly higher over there.

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## onthestrip

> 1. The oil & gas industry pays well.
> 2. Do you really think the state won't take it's money back if it comes out that the application was made of lies?


1. Of course it does, but an average of $146k? Sounds quite high for the average, unless they are including Tom Wards salary. Maybe JTF is right in that they arent including administrative jobs in that employee count.
2. There is no mechanism in place for the state to get back its money if Tapstone didnt hire these folks as long as they said, moved out of state, or just closed up shop. The state makes quarterly cash payments to these companies, so its not as if they are waiting to see if these companies are doing as they promised. Its starts pretty much immediately.

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## PWitty

> 1. Of course it does, but an average of $146k? Sounds quite high for the average, unless they are including Tom Wards salary. Maybe JTF is right in that they arent including administrative jobs in that employee count.
> 2. There is no mechanism in place for the state to get back its money if Tapstone didnt hire these folks as long as they said, moved out of state, or just closed up shop. The state makes quarterly cash payments to these companies, so its not as if they are waiting to see if these companies are doing as they promised. Its starts pretty much immediately.


Even if they only report the 150 highest, that means that they have added AT LEAST 150 high-paying engineering/geology jobs. I don't see how that is something to be cynical about. That's a pretty big number for a new company in an already stretched engineering/geology market (like others have said).

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## Bellaboo

Just talked to the Mrs about this, she did reporting to send to the state for QJ from her company. She said she ran quarterly reports sorted by salary for several years to determine how much they'd get credited for. It sounded pretty up and up on the program. And also there are 3 seperate types of qualifiers for QJ from small rural companies to large manufacturing to more of executive positions that qualify....just a fyi.

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## Pete

> Even if they only report the 150 highest, that means that they have added AT LEAST 150 high-paying engineering/geology jobs.


Correct.

And this is only paid out on a yearly basis after the companies have submitted proof.


As I mentioned, the only downside is that jobs can be created and incentives paid, then the jobs can later be eliminated.  But that doesn't happen very often and even in the case of Chesapeake, they were so far over the mark in terms of hiring that they probably still would have qualified for the funds even with the layoffs.

Doesn't look like they are applying this year, though.

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## Rover

> I am basing it on my own personal experience with similar programs here in Florida.  We didn't count the lower paying jobs because it brought the average down and we only submitted the highest paying jobs for the program.  Thinks about it, if they end up creating 151 positions which one do you think they will not report?  Answer, the lowest paying one.


I'm not seeing the problem here or why to be all black helicopter over it.  Creating 150 high paying jobs is great.  Adding an additional 1 or 20 or 50 not so high paying but market appropriate rates is also good, especially if they aren't getting rebates for those lower paying ones.  This isn't a glass half full thing, it is a glass 95% full thing.  

Pete has identified the only possible negative...if they close or shrink later.

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## Pete

And even if they close or shrink, those jobs were still paying people for some period of time.

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## onthestrip

> Correct.
> 
> And this is only paid out on a yearly basis after the companies have submitted proof.
> 
> 
> As I mentioned, the only downside is that jobs can be created and incentives paid, then the jobs can later be eliminated.  But that doesn't happen very often and even in the case of Chesapeake, they were so far over the mark in terms of hiring that they probably still would have qualified for the funds even with the layoffs.
> 
> Doesn't look like they are applying this year, though.


Everything I read says these are quarterly payments, not yearly.

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## Pete

Yes but are based on annual reports.

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## lasomeday

> I am basing it on my own personal experience with similar programs here in Florida.  We didn't count the lower paying jobs because it brought the average down and we only submitted the highest paying jobs for the program.  Thinks about it, if they end up creating 151 positions which one do you think they will not report?  Answer, the lowest paying one.


JTF, that is probably the average.  That is what oil and gas jobs pay these days.

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## Just the facts

I wasn't being negative.  Tapstone is asking for rebates on 150 jobs whose average is north of $140,000.  That doesn't mean they only plan to create 150 jobs.  They might be planning on 200 jobs but capped it at 150 to make sure they meet the target - and they are going to submit the top 150 paying jobs for reimbursement.  That is not being negative, that is just stating how the program works.  Alas, if you perceive that as being negative then.... ah, never mind, there is already a thread on that.

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## Spartan

Wow now he wants a handout from the city. Uh, no? Hell no.

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## catch22

I believe it is from the state's quality jobs fund. ^

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## Bellaboo

> I believe it is from the state's quality jobs fund. ^


I thought it was the states QJ fund until I read Steve's story in the DOK today. It is from the same fund that the city helped lure Continental Resources with.

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## Pete

Actually, Steve's article contained this bit which will just further the confusion:




> If the application is approved, Tapstone would be the second company employing more than 150 employees to establish a new headquarters downtown since the city’s job incentives program was started six years ago.


The money that Tapstone is seeking is from the CITY'S Strategic Investment Program (SIP).  It has absolutely zero to do with downtown, other than downtown being within the city limits.  There are about 30 companies participating (Chesapeake, Paycom, Terex, Boeing, Baker Hughes, etc.) in this program and only a few of them are downtown.

Also, Tapstone was already downtown and presently only employs 35; they are merely planning to ADD 150 new jobs to that over the next five years.  They won't receive incentives for the existing jobs.

There can be other incentives (like part of the Devon TIF for companies who move downtown) and others from the state and beyond.  But that is completely separate from what we are discussing here with Tapstone and I am not aware of them applying for anything other than the SIP funds.





> Oklahoma City's groundbreaking Strategic Investment Program (SIP) is a discretionary incentive fund designed to help companies that are looking to expand or locate their operations in Oklahoma City. The SIP is similar to the state's well-known Quality Jobs Program in that it provides qualifying companies who meet certain annual wage and new payroll / employment thresholds with cash payments.
> 
> Strategic Investment Program Highlights:
> Incentive analysis for projects based on wage and minimum job thresholdCompanies must be located in Oklahoma CityCompanies must hire a minimum of 50 full-time employees, produce an annual payroll of $1.75 million and meet specific average wage requirements.


Greater Oklahoma City Economic Development - Strategic Investment Program (SIP)

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## Snowman

> I wasn't being negative.  Tapstone is asking for rebates on 150 jobs whose average is north of $140,000.  That doesn't mean they only plan to create 150 jobs.  They might be planning on 200 jobs but capped it at 150 to make sure they meet the target - and they are going to submit the top 150 paying jobs for reimbursement.  That is not being negative, that is just stating how the program works.  Alas, if you perceive that as being negative then.... ah, never mind, there is already a thread on that.


I am not as sure on the state version but the city one which was at least partially based on the state one is based on average salaries created, they would not get to pick and choose which positions affects the program's numbers.

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## Just the facts

Sure Tapstone will get to pick which jobs they get to submit.  How is the City going to know who they hire and how much they get paid unless Tapstone tells them?

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## catch22

Is this personal against Tom Ward?

If Catch22 Enterprises got funding together to start a new E&P company, located in OKC, decided to renovate (or lease space) in a newly renovated old warehouse in Bricktown, and promise to add upwards of 150 jobs at around $145,000 a year; would anyone complain?

This is a good jobs add.

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## Pete

> Sure Tapstone will get to pick which jobs they get to submit.  How is the City going to know who they hire and how much they get paid unless Tapstone tells them?


Because they have to submit payroll reports, the same ones that go to the government reporting agencies for social security and other taxes.

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## onthestrip

> Is this personal against Tom Ward?
> 
> If Catch22 Enterprises got funding together to start a new E&P company, located in OKC, decided to renovate (or lease space) in a newly renovated old warehouse in Bricktown, and promise to add upwards of 150 jobs at around $145,000 a year; would anyone complain?
> 
> This is a good jobs add.


I'm not sure about JTF, but for me it's more of just bringing to the attention of people and questioning whether these things are beneficial and produce more than they cost. Right now there is no study or quantifiable results of these corporate assistance programs. We have no idea if they are beneficial other than everyone's guesses. It has nothing to do with Ward for me, it's not like this is the only time I've questioned corporate welfare programs.

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## Pete

^

These types of programs are particularly questionable when they are merely paying millions to companies like Chesapeake who were going to add the jobs anyway.

Continental was a little different because they moved to OKC from elsewhere, but they are the exception.

BTW, Ed Shadid has raised this very point when these proposals ultimately reach City Council for approval.

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## Just the facts

I have nothing against Tom Ward.  I am still hoping he can financially back auto racing in downtown OKC.  I am not even opposed to offering incentives to bringing companies downtown from the suburbs.  However, this company is already downtown and they want reimbursement for jobs they are going to create in downtown OKC anyhow.  If we go down this path where does it end?  I would rather use this money to make downtown a place people WANT to be not where they are BRIBED to be.

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## catch22

While I certainly and understand that point of view. (And don't disagree with it at all) Unless there was specific language outlining who is eligible for the program and its benefits; it would probably be illegal to NOT grant it; provided they met the other requirements.

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## Pete

Right, the program was created to specifically provide incentives to companies operating in OKC who create jobs within the stated parameters.

The bigger issue is the program itself, not whether Tapstone or Chesapeake or others should receive the money.


Interestingly, Devon and SandRidge never applied to this program, although they certainly would be eligible.

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## Just the facts

On the other hand, this is the kind of local small business that I think should be receiving these kinds of incentives and not the international multi-billion dollar companies like GE.  Tapstone only has 35 employees now and even though Tom Ward has name recognition, that alone should not preclude him from being recognized as a small business owner with a fledgling company.

I think this whole subject needs a review.

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## blangtang

I heard a bunch of NYC financiers are coming to town this upcoming week.

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## ljbab728

> I heard a bunch of NYC financiers are coming to town this upcoming week.


And does that have something to do with Tapstone?

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## PhiAlpha

And now for some good news...As an update on Tapstone, in addition to acquiring Shell's Kansas position, it appears that they are a large part of Apache's divestiture to unnamed buyers that they mention in this press release: 

Apache Corporation : Apache Corporation Provides North American Onshore Update, Announces Sale Of Non-Core Southern Louisiana And Certain Anadarko Basin Oil And Gas Assets

According to the county records in Grady, Harper, Ellis, & Beaver County, OK and this newspaper article from Wheeler County, TX's newspaper: http://countystarnews.com/news/2015/012915/pageA2.pdf, Tapstone is the unnamed buyer in this transaction for the 115,000 net acres in the Anadarko Basin in Western OK and the TX panhandle. This is a major transaction for Tapstone and is a much better chunk of acreage than what they bought in Kansas. Tapstone has also been very active in making acquisitions and leasing in Dewey county, along with some scattered acquisitions in the Arkoma Basin in Southeastern OK. 

There hasn't been much news out of Tapstone lately, but they appear to be very actively building their asset base.

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## Tundra

Will Tom be the next target for the Feds? My understanding is that he was involved with AM of the bid rigging.

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## Pete

Tapstone Is 'Always Up for Sale': CEO Tom Ward - Bloomberg

McClendon Partner Tom Ward Still Regrets Leaving Chesapeake
2016-03-30 04:01:00.3 GMT


By David Wethe, Alix Steel and Alex Nussbaum
     (Bloomberg) -- A decade since his departure from Chesapeake
Energy Corp., Tom L. Ward said he still regrets breaking away
from the company he founded with his friend Aubrey McClendon.
     "We were both better together than we were separate," Ward,
whose birthday fell three days before McClendons, said Tuesday
in a Bloomberg Television interview. "Ive never met anyone in
my career that could raise capital like Aubrey could."
     The two energy entrepreneurs met at the age of 23 and
worked as business partners for the next 23 years -- Ward as the
operations chief and McClendon as the finance guru. By 2006,
Ward had broken away to help form his own company, SandRidge
Energy Inc.
     A federal grand jury indicted McClendon on March 1 for his
role in an alleged scheme to rig drilling auctions. McClendon
maintained his innocence. He died a day later when the SUV he
was driving slammed into a bridge embankment in Oklahoma City
and then burst into flames. The indictment was withdrawn on
March 3 after his death. The second company allegedly conspiring
with McClendon was SandRidge, led at the time by Ward, according
to people familiar with the matter.
     Ward, now CEO of Tapstone Energy LLC, on Tuesday repeatedly
declined to comment on any legal matters that had surrounded
McClendon or that may affect Ward.

                           Oil Patch

     Without commenting on the specific cases, Ward said that
drillers have always been "aggressive" in seeking leases in the
field and that the majority" work together at one time or
another.
     All of these areas start and get more aggressive as things
get proven up," Ward said in his first interview since
McClendons death. Thats been since the beginning of the
industry."
     The two friends founded Chesapeake in 1989, and Ward said
he loved his time there. But the energy explorer, which
McClendon would ultimately grow into a natural gas giant, had
become too complex for Ward by 2006, he said.
     "From a very small company, I could keep track of
everything we did," Ward said. "By the time 2006 came around it
was very difficult for me to run operations like I needed to run
operations to fully have a grasp of it all."
     Ward, 56, built SandRidge into a $10 billion company at the
height of its market value, while McClendon grew Chesapeake to
more than three times that size at its peak.

                        Biggest Mistake

     The biggest mistake he and McClendon made at Chesapeake was
buying acreage in Louisiana, Ward said. Their attempt to apply a
successful model of horizontal drilling in east Texas to the
land in Louisiana ultimately proved a failure.
     "We had to revamp our company around natural gas, which we
did in 1998," Ward said.
     Ward was fired as SandRidges chief executive officer in
June 2013 without cause -- after a four-month independent
review following questions by investors over transactions he and
his family members made with the company. The review found
nothing that merited termination with cause. In 2013, after
leaving SandRidge, Ward formed Oklahoma City-based Tapstone
using his own capital.
     McClendon was pushed out of Chesapeake the same year and
started his own closely held company American Energy Partners
LP. The two men never discussed getting partnering up again at
the same company, Ward said.

                        Friendly Rivalry

     While the two Oklahoma explorers kept a friendly rivalry,
Ward said he couldnt compete with the deeper financial
resources from larger companies such as McClendons. Ward last
traded electronic messages with the notoriously all-hours-of-
the-night e-mailer in February.
     "Most people that have ever been around him were energized
by him," Ward said. "The same with me."

To contact the reporters on this story:
David Wethe in Houston at dwethe@bloomberg.net;
Alix Steel in New York at asteel6@bloomberg.net;
Alex Nussbaum in New York at anussbaum1@bloomberg.net
To contact the editors responsible for this story:
David Marino at dmarino4@bloomberg.net
Carlos Caminada

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## gopokes88

Tapstone issued a going concern and went into forbearance agreement with their lenders. 

https://tapstoneenergy.com/wp-conten...gs_Release.pdf

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## catch22

My brother was laid off at his energy company today. (Not this one). Seems your prediction about the coming bust to Oklahoma producers was true (not that I doubted you).

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## gopokes88

Restructuring complete.

They'll limp along 

https://www.prnewswire.com/news-rele...301043397.html

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## Pete

I wonder how many employees they now have?

I suspect they are not using that entire building any longer.

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## chuck5815

> Restructuring complete.
> 
> *They'll limp along* 
> 
> https://www.prnewswire.com/news-rele...301043397.html


Yeah, $60MM in liquidity might as well effectively be $0, given the size of the asset base.

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## Southsider2

> I wonder how many employees they now have?
> 
> I suspect they are not using that entire building any longer.



This probably belongs in the Mideke Building thread but I couldn't find it. I read today that Heartland Payment Systems signed a lease in this building on March 4th.  I can't verify how accurate that is and doesn't really make sense with their OKC headquarters completing soon but it states they're leasing 77,700 Sf.

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