I foresee a bright future for AAPG – one that encompasses a growing and active membership that participates in multiple scientific communities, which in turn will lead us into strong financial security for the organization. But for this to come about, we cannot continue business as usual. If we do, the Association that you and I value will decline and become a shadow of itself.
What are the reasons we may face this future? I’ve mentioned them in earlier columns, but it is worth repeating. Foremost is the declining membership of AAPG. We have seen gradually declining numbers of full members in AAPG since our peak nearly 40 years ago, and that decline has accelerated in the last 15 years. Many of our older members are dropping out as they pass retirement age and younger people are not joining in sufficient numbers to offset those losses. Our monthly membership numbers indicate we might experience another 10-percent drop in our full members this year.
The second reason for decline is our financial situation. We have experienced cumulative operational losses of $15.4 million since 2014. Nearly half of that was in 2015 and 2016 as the industry experienced a significant contraction. We have taken $13.25 million of withdrawals from our investment portfolio to maintain operations. Our portfolio was able to sustain that level of withdrawal, due to strong market returns. But the portfolio is currently about $9 million, and we cannot expect future market returns to match those of the past several years.
The Way of All Associations
David Curtiss, our executive director, stays abreast of other associations as part of his duties for AAPG. We are not the only association experiencing membership loss and financial strain. David has pointed out that associations typically have similar life cycles. These life cycles typically proceed through several phases as the association ages, which are: conception, infancy, puberty, young adulthood, late adulthood, old age and, finally, a stage of either revitalization or a drift into obscurity and dissolution.
I think that our membership and financial situation strongly supports the view that AAPG is at the moment of decision – whether to pursue revitalization or let the “life cycle” run its default course.
In most of the professional associations associated with the energy markets, these changes are accelerating due to changing social attitudes about the role of energy from oil and gas and the need to address climate change. All endeavors in the public sphere are impacted by social attitudes – our social license. I know that CO2-driven climate change is controversial within our membership, but it really does not matter what your position is on the topic. The fact is that social pressure is now driving rapid changes in how the oil and gas industry does business. Companies of all sizes, from major and national oil companies to minor independents, now focus on the need for climate stewardship and on the energy evolution.
This focus on climate stewardship and the energy transition has had a major impact on AAPG. Many of our corporate sponsors and exhibitors encourage us to give broader support to these subjects. We have tried to address some of these concerns with our support for such content as the highly successful CCUS webinars and conferences, but some concern has been expressed with the slow pace of our change in addressing these issues. In some cases, this has resulted in the erosion of our corporate financial support. Young people want to be part of the solution for climate change and the energy transition, not part of the problem as they see it. This has contributed appreciably to our difficulty attracting young people and our declining membership numbers.
Oil and gas will continue to contribute to global energy demand well into the future. Most professional financial projections forecast 40-60 percent of global energy demand will still be met with oil and gas through 2050. AAPG will continue to strongly support oil and gas professionals who will meet that future energy demand. However, some of our strongest corporate sponsors tell us that if you are not contributing to the energy transition solution you are part of the problem.
The Renaissance Needs a Plan
So what can we do to avoid the obscurity and dissolution stage?
I think the vast majority of our members would want to continue to support the professionalism and community we currently enjoy and continue our support of the geosciences. We also want to support the geosciences and our contributions to the energy industries. Dropping into obscurity or dissolution obviously will not do this. That means we need to work to revitalize or reimagine AAPG.
Other associations have successfully chosen this route in the past and are still strong today. For example, the March of Dimes was originally organized to find a cure for polio and to eradicate the disease worldwide. They contributed greatly to accomplishing this goal, but once it was accomplished, did they just fade away? No, they did not. They reimagined themselves to focus on the cure for all birth defects, and with this worthy broadening of their goals they are still a strong organization today.
Many of us within the leadership of AAPG have also concluded that we need to reimagine and revitalize AAPG to survive. We have been working on a plan to accomplish this goal so that we can continue to support our organization and continue to protect our legacy in the oil and gas industry. We will need your feedback and suggestions for such a plan. Whatever plan we implement will need the support and approval of our leadership and membership, and I think the vast majority of our members will recognize the need for this revitalization and will support it. That is why I feel that AAPG will have a growing membership and strong financial position well into the future.
As my term as president of this wonderful Association comes to a close, I want to thank David Curtiss, our executive director, and our incredibly professional and hard-working staff for keeping us afloat during tough times. I also want to thank all of the many member volunteers who contribute their time to supporting AAPG. Finally, I want to express my appreciation to our membership for their continued support of AAPG. Thank you.