AAPL concluded our quarterly board meeting in March at the Francis Marion Hotel in Charleston, South Carolina. Below is a summary of some of the more pressing items discussed and/or voted on by the board of directors:
AAPL STAFF REPORT
NAPE Denver expo in December, 2014 hosted approximately 2,550 attendees, essentially flat to 2013’s attendance. Suggestions are being reviewed to move the expo to an earlier date. The NAPE Committee is currently trying to get several large Denver-based companies that have yet to exhibit to “buy in” and exhibit at next year’s expo.
NAPE Summit was held February 10-13 at the George R. Brown Convention Center. Attendance was down about 10-11%. Feedback to AAPL was positive, that it was a high-quality show with seemingly more actual prospects than normal. The George R. Brown is undergoing construction, which will present a challenge for NAPE next year as well. Over 500 people attended the Decision Makers Breakfast with Governor Sarah Palin. The Charity Luncheon was attended by an estimated 1,600 people. The Charity Luncheon recognized charities supporting wounded service men and women and heard First Lady Laura Bush deliver a heartfelt talk to a very friendly crowd. Thanks to the generosity of the Charity Luncheon Sponsors, $100,000 checks were presented to four well-deserving charities: Impact A Hero, Canine Companions for Independence, Operation Comfort, and Support-A-Soldier.
NAPE Pittsburg was scheduled for April 14-16, 2015. The NAPE Operators Committee had concerns about the impact of the price collapse on the show’s attendance, and it was decided after serious consideration to suspend NAPE Pittsburg for 2015. The NAPE Operators Committee feels strongly that NAPE Pittsburg will return in the future.
AAPL moved into its new headquarters and all renovations are complete. Southwestern Energy generously donated its old furniture to AAPL, which was very much appreciated. As of the March board meeting, there was an offer on the table for the old building and the adjacent land, and AAPL is trying to go straight to contract.
AAPL is constantly trying to increase and improve its education offerings to its membership. One of the core reasons for AAPL to exist is to provide quality industry and continuing education to members. New classes/seminars being rolled out for 2015 include the Ethics 360 program, Basics of the Oil and Gas Lease, the Marketable Title/Title Curative, and a joint venture with the Society of Professional Engineers (SPE). Plans are underway for a second edition of the Landman 411 Series. AAPL is also working on The Basics of Petroleum Economics. A Distinguished Speaker/Thought Leadership Series is also under development, in which subject matter experts/industry leaders deliver a single presentation on a topic of current interest.
All of the new seminars mentioned above, plus the ‘normal’ education seminars and classes certainly makes for a full slate of interesting and relevant topics for landmen. Due to the downturn in commodity prices, the Board of Directors approved a 50% discount on all education classes being held between now and 12/31/2015 for all active members. All education materials, books, etc, will be sold at a 25% discount. AAPL recognizes that these times create hardships for many of our members, and we hope that meaningful industry education is something that our landmen are willing to continue.
Current total members as of 2/19/2015 = 19,674; 758 new members since this time last year. 6,213 total designated landmen: CPL – 2,914, RPL – 2,168, RL – 1,131.
As compared to 12/31/2014, total assets have increased from $33,353,333 to $34,134,843, a change of $781,510 (2.34%). Revenues (exclusive of investment income) compared to 12/31/2014 have decreased .97% from $3,217,134 to $3,186,075, which was due in large measure to decreased revenue from NAPE distributions and management fees. Expenses have decreased 8.64% from $3,657,117 to $3,341,087. The net ordinary income (loss) for the 6 months changed from $(439,983) to $(155,012). The decrease is due in large measure to a significant decrease in advertising expense from the completion of the 2013-2014 “Insist on a Professional” Campaign. Investments as of 12/31/2014 are $27,872,471, a decrease of $4,569,708 or (14.09%) as compared to the same period last year. The decrease has been the result of realized and unrealized gains, dividends, and contribution of $4,000,000 stock from AAPL to the Landman Scholarship Trust.
The Ambassador’s Toolkit has been printed as a booklet for anyone to use and hand out. The online version can be found here: here.
I have about 50 hard copies of the booklet and can always order more for free from AAPL- please get ahold of me if you would like them.
AAPL has an online store with many items sporting the AAPL logo and the Member Mark. The store can be found here: here
AAPL’s Annual Meeting is taking place June 16-20 in Nashville, Tennessee. I was able to attend last year’s Annual Meeting in Montreal, and it was a really good time. There are plenty of great educational seminars and classes offered, events, interesting speakers, and of course great networking. My wife and I were literally the only couple from Kansas out of over 1,000 attendees, and did not know anybody at first. By the time we left, we had made some good friends and business contacts that we both still keep in touch with. I highly recommend attending if at all possible. More information can be found here: here.
Probably the most substantial business item for this board meeting was the approval of a change in who may qualify to earn an RPL or CPL designation. Until this motion passed, the definition of “Landwork” in the AAPL bylaws differed from the “Qualifying Landwork” that was necessary in order to qualify for and sit for the RPL and CPL exams. Without going into too much detail, “Landwork” as the bylaws defines it consists of those landmen who negotiate for leases and/or agreements and contracts between companies, those who determine mineral ownership through research of public records, those who perform due diligence and cure title defects. However, the only landmen who could qualify for the RPL or CPL designation were those primarily engaged in the negotiation for mineral rights or business agreements.
There was much discussion over the last three board meetings about the fundamental changes in the land business over the last ten years or so. Land services and land departments of exploration companies generally have become much more compartmentalized, with some landmen primarily negotiating for leases, and some landmen primarily determining mineral ownership. In Kansas, the “jack of all trades” landman is still fairly common; however, in much of the country, this is uncommon anymore. The motion at the board meeting was to align the definitions of “Qualifying Landwork” as it appears in the RPL and CPL applications, and “Landwork” as defined in the AAPL bylaws. The motion carried, effective immediately.
Audits by state and federal agencies to challenge the status of independent contractors are becoming frequent through the U.S. Landmen and brokerage services are attractive targets for the government agencies, as most all field landmen claim to work as independent contractors. Loss of an audits which change the status of independent landmen could undermine their ability to work as independent contractors going forward. Brokerages and landmen alike should be prepared for an audit on this issue. The AAPL Tax Issues Committee been working diligently on the Tax Issues Online Toolkit, a Master Services Agreement, and a Price, Waterhouse Landman Survey. This information is available for free to all active AAPL members in the government relations section of AAPL’s website, here
. If you are a brokerage or an independent landman, I highly suggest you check out the toolkit, it may ultimately help you protect your independent status if the State of Kansas begins an enforcement campaign on contractors, or if you are targeted by a federal agency.
AAPL’s purpose is to serve its membership. I think you will find the Association to be a great resource for information and research that can directly help you and/or your business. If you are not already a member of AAPL, please consider joining. The benefits of membership in this good and strong organization are well worth the price of membership.
If you would like more details about anything discussed herein, or about AAPL in general, please don’t hesitate to contact me.
Nicholas D. Hess, CPL
AAPL Director – Region VI