Downturn puts squeeze on oil workers
Jan. 17, 2016 at 12:03 a.m.
Updated Jan. 18, 2016 at midnight
Kenton Cooke sat on the couch in his Victoria home, surrounded by pictures of his family.
His wife, Rose, and son, Doug, played in the other room with Doug's daughter, Laylah, while her twin brother, Xavier, slept.
Kenton and Rose's 4-month-old grandnephew, Liam Lopez, cooed from the couch as a friend, Steven Boothe, walked in and started talking with Doug.
In the relaxed atmosphere, it was hard to tell that Kenton Cooke had been laid off from the oil field since March, and that Boothe's hours and rates as an independent welding contractor had been cut back. Only Doug Cooke, a derrickman, seemed to be untouched - although the company he worked for, Lewis Energy, had slashed its rig count down to two.
This is the situation in which many oil field workers across Texas have found themselves a year into what investment group Morgan Stanley is calling the worst bust since 1970.
Oil prices for West Texas Intermediate are barely staying above $30 a barrel - and on Jan. 12 they dipped below the $30 mark for the first time since December 2003.
Plains All American Pipeline, a U.S. oil transportation and storage company, is currently buying most U.S. crude oil for less than $29 a barrel.
All of this has led to tens of thousands of jobs lost across Texas, with many of those in exploration and production companies and the service industry. Manufacturing has felt the pain as well - two local plants announced hundreds of new layoffs on Jan. 7, with experts putting some of the blame on the oil downturn.
Caught up in all of this are ordinary people like Kenton Cooke, his son and Boothe, among the men and women who have made their name - and their living - in the oil fields of South Texas' Eagle Ford shale.
LOOKING FOR WORK
Kenton Cooke is a quiet, contemplative man. With a bushy moustache and missing the tips of his right ring and pinky fingers, he's put a lot of miles on his body in the 43 years he's worked in the oil field.
Now 57, he said he holds no ill will against Murphy Oil, the company that laid him off in March.
"I didn't have any bad feelings toward them. It's a sign of the times," he said. "It's not the first time we've been through this."
The layoff came when Cooke was making $1,200 a day as an independent drilling contractor in charge of drilling operations.
The last time Cooke was laid off was during the 2009 downturn, but he welcomed that layoff as a relief from 24-hour workdays.
It also helped that in 2009 the industry quickly recovered and he was able to go back to work.
This time he said the only opportunities he is seeing are in the Middle East with Saudi Arabia's national oil company, Saudi Aramco.
Even though Cooke wants to work, he has one main issue with working in the Middle East: "If I go over there there's no guarantee I'm going home."
"I called Shell, I called Oxy (Occidental Petroleum). I called Exxon, Conoco. I called all 17 firms and they've called all of the companies," Cooke said of his job search.
None of the oil companies and 17 consulting firms he works with were hiring. "Worldwide," he added.
The need for money coming in is less for him and his wife than other oil workers: Cooke and his wife's cars and home are paid for. But they have had to cut back on a lot of what Cooke called wasteful expenditures. They no longer go on cruises, or buy new cars every other year. They occasionally eat out, whereas before they would go out almost every night.
They removed several channels from their TV package.
Now that they've taken a look at their expenses and cut these out, Cooke said even if he goes back to work, they will be more mindful of what they spend.
"There's just so much that we had that we were doing, that we were wasting, and this has been an eye opener to us," he said. "It hasn't been so much a hard time as it's been an eye opener."
BILLS TO PAY
The story is different for Steven Boothe, a 10-year veteran - what he calls a "long minute"- of the oil field as an independent welding contractor.
At 29 years old he has spent his working life in the field working on pipes to and from oil rigs and well pad sites similar to those that Cooke worked on.
Boothe said four months after Cooke was cut, he started feeling the pinch in his work.
"We were still working, and then it just got to the point where if rigs aren't working, I'm not making no money because we can't run pipelines to their rigs," he said.
With oil prices continuing to fall and companies cutting even deeper into their workforces, Boothe has seen his pay and his hours cut by more than a third.
"I went from making $1,200 a day to now I'm going to be barely making $500 a day. That's how bad it is compared to what it was," he said.
But he's thankful that he still has a job. He works on contract with K&K Repair Services in Victoria.
Compared to his fellow oil field workers, Boothe said he's been able to put some money away over the last five years while the Eagle Ford was booming with oil activity. During that time he never had to dip into his savings.
Now Boothe said he is being forced to spend it on payments for his house and truck, among other expenses.
"I've got $1,200 in bills a month that I got to pay, and I gotta have it coming in," Boothe said. "I don't have unemployment; I don't get unemployment to help me out."
Boothe and Cooke are not able to tap into unemployment because they are independent contractors. While Cooke relies on consulting agencies to help him find new jobs - and help with insurance - Boothe has to pay for insurance and his equipment out of pocket - even when he's not working.
STILL DRILLING DESPITE LAYOFFS
Doug Cooke, 29, is the one who has had steady work despite the downturn and upheaval within his own employer, Lewis Energy. The independent exploration and production company shed hundreds of jobs during 2015.
When asked why he made the cut, he slyly quipped "I'm just one of the best workers out there," making the others laugh.
As a derrickman 120 feet in the air with only his experience and a harness to keep him safe, Doug Cooke works 12 hours on, 12 hours off for seven days, and gets seven days off. This gives him 44 hours a week of guaranteed overtime, which pays 1.5 times his base pay of $26.63. Add on his $30 a day per diem, and he pulls in at least $400 a day.
He said that when Lewis started laying off workers, they cut the guys below him and took the higher ups - the company men, tool pushers and drillers - and moved them down in position. He said some of those men would not do the work he does.
"A lot of the older guys they don't want to work derricks, they don't want to go up high, or they don't want to mix chemicals," he said. "Some days I might throw 300 sacks (of chemicals), and each sack weighs 50 pounds. I got to do that every day."
The younger Cooke said the bright spot now is out in West Texas, even though he was told years ago that the Eagle Ford shale was supposed to last for 15 years.
All three men hope the oil prices will rise soon. They think it has to rise above $60 a barrel before some semblance of stability returns to the industry.
Cooke's wife Rose summed it up nicely: "It'll get better though; it always does. That's why it's called the boom and bust."
Cooke believes many in his generation are just tired of the ups and downs of the industry, and that despite the high pay many will leave. He sees the turmoil as a non-issue. He wants to keep working for a few more years to make it to Social Security age.
While Doug Cooke continues to work, the fraternal feeling he has with his fellow oil field workers is something that will always keep them together.
"We spend more time out there with them than I do with my own kids," he said as he played his twin daughter, Laylah. "So the guys that I work with, we become a family; we become brothers."