Each fall at Merrion Oil & Gas the gospel of engineering is preached to 30 or so high school seniors (and a few San Juan College students), proclaiming the power of math applied to a problem. Yes, math is kind of like a sermon… it doesn’t always go down easy, but man, it sure can be good for you!
The “services” are held once a week at Merrion’s office every Wednesday morning from 7 to 7:45 a.m. before school. The students are taught the basic principles used to predict the future performance of an oil or gas well. They then create a spreadsheet that converts their predicted production into a future cash flow schedule.
Using time value economic principles, the students are then able to determine the present value of a well. In teams of two or three, their final project is to evaluate a property for sale and recommend a bid price in a formal presentation to Merrion's mastermind, T. Greg Merrion.
In last year’s program, Merrion Oil & Gas bid $324,000 on 3 gas wells in Wyoming, only to get nipped at the tape by some rich, sly cowboy. Real world engineering evaluation. Real money. Real time auction.
Meg Mullins and Melanie Kemp try to convince T Greg and Connie Dinning that $352,000 is the right number to bid.
The students put $5 a piece in a pot to be taken home by the team whose bid price was closest to the final closing price. Farmington High School’s team of Jared Williams and Ned Merrion were closest with their bid of $340,000. The students also had a team name contest which was won by FHS’s Cameron Baca and Dyllan Taylor with the name “Fossil Fools”.
The program began in 1994, and while we have lost the bid most of the time, we have made a handful of acquisitions over the years, one for $1.5 million for an interest in some prolific Fruitland Coal wells. It began with one student, and has grown to include 25 to 30 kids each year.
To date, a total of 318 students have completed the program. Of those, maybe half of the students go on to become engineers, and only a small percentage of those go into Petroleum Engineering. But 100 percent of the students know a little more than when they started, and even those who didn’t go on to be engineers at least got to cross one career choice off the list of a bazillion from which to choose.
While the specific subject matter is based on Petroleum Engineering, the discussion covers principles common to all engineering disciplines. At the end of the day, it’s not rocket science. Most problems can be solved with a little bit of Algebra I and a whole lot of common sense.
Also discussed is the fact that most of what they learn in school they will never specifically use, just as most of the work that happens in the weight room is never specifically repeated on the field. But every workout makes you stronger, and every problem solved makes you smarter.
T. Greg Merrion is proud that his company gives back to the community through this program.
“I like having the students, many of whom I’ve known all their life, come to our office and experience the work place environment,” Further, he says, “The fact that they make a formal presentation to me at the end of the program not only builds character, but emphasizes that good communication skills are just as important as some fancy-dancy analysis. These kids are committed and make a significant sacrifice for no extrinsic reward other than a cardboard certificate at the end of the game!”
We are in the middle of signups for this year’s program, and there is still room for a dozen or so more bodies at the table. Students interested in hearing “the gospel” who are seniors at any high school in the county or who will be attending San Juan College, should contact George Sharpe, Investment Manager, at 505-402-5798 or by email at firstname.lastname@example.org. Hurry when you can, because the sermon is about to start!
George Sharpe is an Investment Manager with Merrion Oil & Gas in Farmington.