What The Funk?

0:00 And after 32 minutes of technical issues, I think we're finally able to start a podcast. It's amazing how difficult it is sometimes. If you're not, the technology is pretty simple, but every once

0:14 in a while, it just doesn't work. And we have to mess around and restart 15 times and test things. And then suddenly, hey, there it works. Let's start recording. Yeah. Podcast is the real deal,

0:25 you guys. This is not just, you don't just show up and throw up You got to be prepared to put in the work too. We're not rock stars like Darren Woods or anything like that.

0:36 A legit rock star. That's what I like. So I feel like we know you pretty well since we've already recorded a bunch of this that didn't actually record. But I want to get into Mr. Darren Woods from

0:47 north of the border

0:50 grew up in the British Columbia and lives in Alberta now. But I want to to go through your past, kind of get a sense of who you are, how'd you get into oil and gas, energy tech, and all the fun

1:01 things you've done in your career. You know what, the origin story. As you get started, and he made this point earlier, and I want to make sure he drills into this. When you said British

1:09 Columbia, the first time we tried to record, he quickly said Vancouver Island. So is there a subtle territorial difference? You actually differentiate like that normally, or? You're probably

1:21 opening up a can of worms. Oh, here we go. Yeah, no, not really I mean, so Vancouver Island is that sort of

1:30 long-shaped island that just sort of dips down below the 49th parallel and is right across the Strait from Port Angeles, Washington. So I grew up in Victoria, British Columbia, which is actually

1:43 the capital of BC. And it's the little city of about 500, 000 people, a big little city of 500, 000 people. That's right there on the southern coast, the southern tip of Vancouver Island So I

1:54 grew up there and to be honest, that well traveled to this day. I had very little exposure to even other parts of Canada, let alone North America or globally. But today, kind of like you alluded

2:09 to, right? I live in Alberta and I've spent a lot of time down in Texas and Colorado is a consequence of my work in the oil and gas and broader energy space. But in terms of my upbringing, yeah,

2:23 pretty humble roots, big business, let alone big energy business was not in my family anywhere, from a family of civil servants and sort of local, local government people. But you know, I was

2:36 ambitious and the way that I channeled that ambition when I was young was through music. Like, you know, all I wanted to do was be a rock star. That's all I thought about while I thought about it.

2:46 I still think about that, actually. Go for it, man.

2:51 You know, yeah, so when we tried recording before, I mentioned that movie almost famous because it's it's actually like a

2:59 You know, it's a great movie, but it's also a great example of how a lot of

3:05 Aware a lot of musical careers stullowed. I think particularly in the rock music industry, so You know, I was always a big rock guy. I learned to play the guitar when I was like nine years old and

3:18 I was big into Guns N' Roses and Slash, you know

3:21 You know mostly sort of you know 80s 80s era rock

3:26 and Also, I was in high school and you know the early 2000s when rock had somewhat of a comeback and you know started with pop punk like you know blink 182 and some 41 which is a Canadian band and

3:39 And you know that just sort of opened up this this universe of of sort of um You know rock industry 20 and I got into that industry, you know, I when I finished high school You know, I've been

3:52 playing in garage bands as I was a kid Um, and then, you know, come grade 12, uh, some of those garage bands were getting kind of serious. You know, we were composing our own stuff and, you

4:02 know, people were telling us, hey, like, you know, you're really good. Are you, are you gonna be a professional musician? Of course I was like, of course I'm gonna be a professional musician,

4:09 so. Why wouldn't I be? Yeah, yeah, so, you know, I spent a few years touring and recording for, you know, for profit, for a living, you know I, had day jobs and stuff, worked at my local

4:20 guitar store in Victoria by day, selling guitars to, you know, fall short of paying the bills

4:28 But, you know, it was a lot

4:32 of fun. And, you know, one thing that's kind of neat in the context of, I guess, like, global history.

4:40 You know, some people might think I've blown this out of proportion, but I feel like I really did experience firsthand the sort of like the death rattle of the for-profit rock music industry, you

4:50 know? I think that that second wave that I referred to that to rock industry 20 was like the last. that we're gonna see of, you know, sort of the almost famous type stuff where you've got these

5:02 bands who assemble, they write some music, you know, they manage to scrape together some capital, go on the road and, you know, they usually don't break even, but they get to sort of live out

5:13 this dream, see the crowd, share their music with the world, and, you know, then come home underwhelmed with a whole bunch of emotional baggage. So, you know, that's sort of where I got to

5:26 with my music career, and then, you know, I actually got into the business of music along the way, which sort of started me on this other trajectory that I guess, you know, through a complex

5:37 sequence of events brought me here, where I'm at, you know. Wow, it's fantastic. So, I guess, well, I mean, one of my favorite guitar riffs is the sweet child of mine, and all that with Guns

5:51 N' Roses. You said that, so as you said, Guns N' Roses, that's what's going through my head. Really?

5:56 the cause cause for me it was a November rain all of a sudden came into my head. So that just tells you we're from that that GR era. Yeah. Yeah. I can't, I can't tell you how many times I, I

6:09 watched the music video, but just just the slash is solo.

6:15 When I was a teenager.

6:18 Yeah. That's good. That's a fun stuff. You know, of course, I was a great air guitarist, but never could actually pick anything up. But one thing that I, that, I mean, the band guys that I

6:28 always talk to and my kids were kind of a, so one of my kids was associated with the band. The band directors always said that people who learn music and can read music and really get into music are

6:40 natural in mathematical and sciences. It doesn't, to me, I don't, it doesn't make the bridge, but I find it interesting. Have, has, do you think that that aided you in your run into, you know,

6:52 an oil and gas, really? Yeah, probably. one kind of mysterious thing. One thing that sort of mystifies my family and friends is that I'm like weirdly good at math. And you know, you wouldn't

7:04 think that of it. Like, you know, you're looking at me now and I've got this beard and everything, but you know, like you should've seen me when I was like 22 years old. Just visually, it's

7:15 like, okay, this is the last guy in the world who's gonna go with it. So last guy I expect to play a November rain bridge. To quote Guns N' Roses, Just from the Merchant living under the street

7:25 Like that's what you would've said if you saw me. But no, I do get numbers and I like numbers. I think mathematically, like I reason mathematically. And I think that probably has a lot to do with

7:38 all of the music. My parents put me in this program when I was really little called COVID-19. I don't know if that's just a Canadian thing or maybe it's like a - Have an art of it, yeah. I'm not,

7:49 anyway, it's sort of like

7:52 a music class for very small children. toddlers where, you know, they're just sort of taught how to make noise and sort of taught the basics of rhythm and melody and stuff like that. So yeah, my

8:05 parents enrolled me in that when I was a kid. So maybe that sort of started me on this

8:10 trajectory. Plus, I mean, you know, it's probably cold up there, right? So you got to be inside a lot here inside. You play the guitar more, right? I mean, let's. Yeah, you got to worry

8:20 more about the humidity and on the cold I'm going to say he's a coast, he's a West coaster. It's got a much milder winner than say, you know, Alberta, Edmonton or something. Tell you that for

8:32 free. Which

8:34 is where home is for now.

8:39 So you live out the dream, right? And then eventually, like you said, like almost famous. Yeah. The dream to be the rock star for a lifetime dies. Yeah.

8:51 Yeah, so I, like I said, I had day jobs, right? And one of the day jobs that I had

8:58 was with this Dutch guys. There's a big population of Dutch people in Victoria because of the horticulture industry there, right? It's the garden city. And so, you know, a lot of Dutchmen

9:10 trading flowers making money and a lot of people on the house. It's just like two growers? I'm sorry? The Dutchmen, I think, had tulip growers and of course, anyone else are trading flowers.

9:19 Okay, they are doing that Yeah, correct, you can go out to some of the suburbs or like farmland around Greater Victoria and see, you know, just sprawling tulip fields. It's cool. Wow. And yeah,

9:31 and so not a lot of people know this, but there's quite a liquid market for horticulture. So there's actually this big exchange that I believe is still called the United Flower Growers. It's on the

9:42 lower mainland, just in Greater Vancouver. And every day, you know, semi-trucks pull up and all these horticulturalists trade their product So one of the day jobs I had was driving a truck for a

9:55 company that did that. And just watching, you know, I got to go to the auction several times a week and just watch the market activity, which really gave me a little bit of an adrenaline rush.

10:07 You

10:09 know, probably the same sort of sense of

10:12 enthusiasm that you might, when you sort of see a Wall Street trading floor for the first time, you know In my sort of small coastal town world, that was pretty exciting. And so that got me

10:23 thinking about stocks and markets. And, you know, this was right around the time that, yeah, Jeremy, like you said, you know, I sort of realized this is, you know, this is all there is.

10:33 This is as far as I'm going to go with music. So what else do I want to do? And that made me want to go to business school and learn about business, particularly finance, which made me want to try

10:41 a new city. So, and that part was arbitrary. I was just sort of like this town is small. I want to see what else is out there I'm so different. Yeah, there you go So I just get a dart and went

10:52 to Calgary or? Pretty much, yeah, pretty much. Like I,

10:58 now we're getting to the other thing. I was a little bit fascinated with Western and Ag culture. And you know, Calgary is, it's got this dumb nickname. People call it Cal town, which I always

11:13 roll my eyes at. But you know, it is sort of the heart of like Canadian Western and Ag culture, which is arguable particularly if you've got people listening from Regina or Saskatoon. But yeah,

11:28 so you know, I moved out here in 2010. I'd spent maybe five years on the road playing music and was just really excited to learn something new, get into this, you know, big, you know, flashy

11:41 world of business and see, you know, Calgary to me was a big city. I wanted to see a big city and I wanted to see tall buildings I wanted to meet big important business people. So, you know, my

11:53 undergraduate degree was my sort of vehicle through that

11:57 and, yeah, majoring in finance and then when I finished school, I just got pulled into work by industry and, you know, there's more story to tell there. I like the subtle background of this.

12:10 Well, you know, my first run was at, was rock and roll and my fallback is investment banking. You know, that's just a great line Maybe that's what we should tag this. He's got a big brain, you

12:23 know. So then, so then you went about getting your CFA, right, which is, which is no easy task. Yeah, I was hired by, well, I tried a few, I tried a few sort of short term gigs, right

12:35 around the time that I was finishing up my degree, you know, did some like work terms and, and tried a few jobs and ended up at, at this, this asset management firm here in calorie that was

12:46 managing about a billion at the time, a billion and a half. across a portfolio of mutual funds and hedge funds. It was all, you know, public equities. And so, you know, that was, that was

12:55 like, right where I wanted to be, right? And yeah, they put me through the CFA program. They sort of taught me everything I know with Excel. You know, it was a neat environment too, right?

13:06 You know, I sat sort of next to, I guess, our little trading floor, which was, you know, pretty calm and collected compared to the kind of stuff that you see in movies like Wolf and Wall Street,

13:19 but, you know, it was a lot of fun getting to work with traders and portfolio managers and, you know, just see the way they interact with their, you know, the advisors that deal their products

13:32 to, you know, and investors and just constantly talking about stocks and companies and earnings. And, you know, it was a rush for a guy in his mid-20s, you know, living in this little sort of

13:43 downtown bachelor pad walking to and from work, I felt like I won the lottery.

13:49 No, I love that. That's got to be great to have that, to be that excited about going to work. I mean, a lot of people don't get that ever. Yeah, I got that. I got that. Sorry, this is my

14:00 podcast, Darren. I get to talk when I want to talk.

14:04 No, I get that like, you know, listening to you, it's a little bit, it's a little bit like me, right? So I'm a small town kid from 3, 000 miles away from where you're talking about. And there

14:14 was always this allure of the big buildings, right? Just whatever is not country seems to feel like, like fancy and rich and extravagant. And like, I'm gonna do that, right? That's gonna be me

14:29 one day. So my early jobs too, like, and Tim, I'll give you this. You were the first person I worked for that gave me full blown work from home opportunity. And because I was so appreciative of

14:40 that, I was like, I don't wanna screw this up, right? And then you quit. So I worked there for three years, Tim. You can't just do that But

14:49 I would make sure, like, 'cause, you know, the first time you start working from home, it's all this autonomy that you never had between school and then a dozen years of going into an office,

14:57 right? And you gave me this new level of excitement with being at home. I'm like, okay, with great privilege, comes great responsibility. And realized, you know, you can't just go out for

15:09 beers in the middle of the day. But nonetheless - Well, you know, I gave you that, well, I gave you that I was not gonna rent an office for you just to drive to. But Darren, since you haven't

15:22 seen the house he was working out of at that time, complete, I never could have gotten anything done in that house. It's a complete distraction. He's got, he's on the side of a mountain, dirt

15:32 road, and a babbling brook down below him, and a porch, or a balcony that kind of overlooked it. Mountain lions coming down the hill every once in a while never would have been able to work there

15:43 I would have been standing outside the whole time. That tests the work, I think, doesn't it? Yeah. so tough. And then he moved. That was the most irritating ever. He'd moved. Oh, like

15:55 everything was so calm and so nice. The babbling brook, the door open, right, with just the screen at night. You don't need AC. Yeah, you're good. And then getting put in the middle of the

16:05 suburbs, like a subdivision like, what the fuck is going on here? And bring me back. I want to go back to the woods. So going back to woods. There we go. Nice transition. Thanks. Well, we'll

16:17 score that one later. Yeah, 54, maybe. Well, we'll judge the best one that you can fit in by the end of the podcast. Believe me, I could have fit one in in the beginning that I chose not to.

16:28 We'll just leave that to the side for now. But I can probably guess this was Darcy next because that's because you really made a big impact at Darcy. And

16:38 you and I are doing some work together right now. And a lot of it has to do with the fact that that you've been a connector, right? You built up sort of to the finance side and then

16:50 you branch into the oil and gas and energy tech innovation side. Talk a little bit about the momentum because I know it was a really exciting time for you and for the organization and to be able to

17:00 offer up tech solutions to operators. Tell me about the Darcy experience. How'd you get in and - Wait, give a little bit about what they do 'cause it's a different footprint. It's a different

17:10 thing to what Darcy does. Sure, so I'll actually start there So Darcy has a

17:19 really elegant business model for playing matchmaker between energy innovators and energy operators. So they have this program of forums where

17:31 they effectively just present technology that's been scouted on the basis of feedback that they've collected from the operators in their network. So they go to their operators and they say, what are

17:42 your pain points? Now this is where I think Darcy gets really competitive because they can actually go toe to toe. with pretty much any operator in the business in regards to even the most technical

17:55 operational challenges. Like they've made a business of being very good at understanding, digesting

18:05 those technical pain points and then going out and scouting really effigant solutions that sort of hit that nail right on the head. And then they present those findings, those scouting and research

18:16 findings through those forums that I mentioned So the company - So the company - Hold on, so for, like I always thought it to him a little bit of like an industry centric gartner-type offering,

18:28 where they sort of have a magic quadrant in mind and then sort of play matchmaker, but it's the level of detail that they get into. I think that separates. When I think, you know, and I've been

18:38 invited as a innovation vendor to be a presenter to the, in a forum. And so it is kind of interesting from that perspective of, you're being brought in because you, you scratch an itch for this

18:52 group of people. We think you're going to be a good fit. So we just want you to present. And you know, wound up, we got some business out of it, which is, you know, what we wanted. And at

19:01 that level, they're not charging the innovator. That's right. They're not coming in and saying, hey, you need to pay 10 grand to be part of this conference or whatever. Right. And there's

19:09 models for that. This was very different. That was a part of the interesting. Now, the other part that is cool and that's where Darren was building up to is, you know, Hussein went out and got a

19:21 bunch of technical people, these advisors who knew their shit and brought them in to then go find the innovators and bring them together. That's what I think is so different about what he did is

19:33 organize a lot of people. And I guess a lot of them are part-time and retired guys that, you know, came out of Chevron 30 years or whatever and really brought a bunch of different things Anyway,

19:44 it's a very interesting connection of people. And then - and their business model is very different. They broke the game, man, when it comes to procurement, like how the service side interacts

19:56 with the EP side of the business. They broke that game. And they did it, I think, by sort of having the courage to look at the two sides of the market and say, you know what, what if we just

20:08 don't charge these guys? What if it's effectively a free service to the innovator side of the market? And that way the operators know that we have no monetary incentive to sell them anything. You

20:19 know, we're really just working for them, trying to high grade and filter through solutions that really do address the information that they've given us about what they need. And I guess the

20:30 premise initially, I'm sorry to jump in just because I was at the kind of the early ones, was, you know, a small innovator, new startup, doesn't have access to the CIO of, well, I already said

20:43 Chevron, of Chevron or whoever else. you know, and that the CIOs all say the same thing. You know, we never get a chance to see all this new stuff. And all right, well, whose fault is that?

20:56 You've got a lot of people being put up in front of you to prevent you from seeing it. So that, I think that's the position that Darcy carved out initially was, hey, they want to see the new stuff,

21:07 but they don't have time or the barriers are too high for them to see the new stuff. And they were able to kind of pull those together And then the Chevron's of the world, I don't even know if

21:19 Chevron's a client of Darcy or not, pay to be part of this club to be able to see all this new stuff. All right, I've oversimplified it some, but anyway, so you were one of the advisors, I guess,

21:32 in this process? Well, I ended up running Darcy Canada for a little while. So this takes us back to when I was still sitting at a desk at an asset manager, right? And so now I'm a CFA and I've

21:43 been there for a number of years and I was probably a little bit faster with Excel. that I had to be. And so a guy who I'm going to give a shout out to by the name of Andrew McMurray, who's - Oh,

21:53 no, no, no. Yeah, he's a pretty well-known guy here in Calgary, Canadian oil and gas. He worked with Step Energy Services. And then - so you mentioned Jose and Roxari, one of the co-founders

22:05 of Darcy, him and his co-founder Jeremy Sweet. They approached Andrew and basically said, hey, do you want to set up a Canadian presence for us? And Andrew, he's a really inspiring guy, by the

22:20 way, if you ever meet him. He just loves nerding out on technology. He's really outgoing and just one of those really inspirational people who you just love listening to. And so he and I were put

22:32 together for a coffee meeting by a common friend of ours. And we talked a

22:39 little bit and he said that he was looking for somebody to make a long story short. He was basically like, well, why don't you Try your hand at Beatty, like, you know, I get it. right? If you

22:49 stuck around and stayed in the industry that you're in, then maybe one day you'll be managing a little portfolio of your own. But you could also get into this really cool energy technology.

23:02 And you seem like a people person is another thing you told me. Why don't you come hang out with me and I'll show you the ropes? It was my first business development gig.

23:13 But anyways, I chatted about it with my wife and stuff and yeah, I decided to just try something new, seemed exciting. And furthermore, I'd always been pretty into oil and gas production from a

23:29 technical perspective just because it is so fascinating. One thing

23:34 that I've always sort of said about this business is that it's an industry of excellence If you hang around with oil and gas professionals, you encounter excellence, you know, technical excellence,

23:43 engineering, geoscience, excellence, you know, and. Actually, during my time at Darcy, I met this guy. He was a completionist engineer. And he was talking about his work. And sometimes, how

23:56 he just sort of sits back and realizes the complexity that they're trying to overcome. And he said this, which always stuck with me. He's like, if I'm in a plane at cruising altitude and I look

24:05 out the window and I can see the ground, I remind myself, we're trying to hit a target area from that depth with such precision And the degree to which we care and obsess over achieving the goals is

24:26 tremendous. And so on that basis, I was really excited to get into that culture of excellence. I wanted to learn more about the kind of people who came up with these novel and innovative concepts

24:41 for boosting process efficiency and, of course, be it in Calgary, you get plenty of exposure to that, just sitting down at the second cup in the plus 15s. You're gonna get that exposure just by

24:57 sitting there listening to people go by. Yeah, just living and breathing in the city. I was already very aware of the industry and more from I think like a capital market perspective, but

25:12 it was really exciting to be able to join the team

25:17 and be given this sort of like paid permission to just nerd out over technology and sort of put just numbers and dollar signs on hold for a minute. So anyways, that's how I got in. And then

25:33 I think it was towards the end of 2018, Andrew stepped away from Darcy and

25:40 Jeremy Sweek, one of the co-founders down in Houston, basically said, look, we can either hire a replacement. Andrew or, you know, you do it. We'll just bring you up. You know, I can do the

25:53 job with you for like six months. And

25:56 so I said, yeah, let's do it. Yeah. And it was a steep growth curve. But, but, you know, that's, that's how strategic consulting is, right? You know, sometimes I feel fortunate to have

26:08 ended up in a job like that, just because, you know, one year in, in a, in a role like that is maybe five years and other roles out there. So, you know, I learn an awful lot. Yeah. I mean,

26:21 we're going to have Jeremy on the podcast in what the summer, December. Yeah. He's committed. We don't have a date yet, but we're close. He's great. Very kind of dry. Tells it like it is. You

26:34 know what I mean? I really like him. Very smart. But, but yeah. So I actually met Andrew around that time and I think what happened with him, which is something that's happened I've seen with

26:42 Darcy people, is you're working with all these innovators and you fall in love with one and you take a job. 100. Right? Yeah, yeah, 100. I've seen that on the curves. Right. Yeah, that's the

26:53 curves.

26:55 Didn't happen to me at all. Didn't happen to you. So you went out actually after Darcy, like around late, what, late 2019 or early 2020 and got back into the investment finance space, right?

27:08 Yeah, it was mid 2020, right in the middle of COVID. Yeah, good time. Perfect. Yeah, great time to start an advisory firm, right? You know, you know, especially with the catalytic effect

27:20 that COVID had on this whole ESG phenomenon, you know, I just really had been developing a thesis around capital flow. You know, given my finance and capital market background, I was just, you

27:32 know, looking at the energy landscape, the energy tech landscape, the energy transition landscape and sort of honing this thesis about how capital needed to move in order for that transition to

27:44 roll out, you know, responsibly, sustainably, economically. And I saw an opportunity when COVID hit to step back into the capital market and say, all right, guys, let me help direct traffic

27:57 here. And so I set up an advisory firm with some partners here in Canada. And it's so funny that you mentioned that

28:07 that sort of common trap of getting sucked into - Same to the bunch. So that's basically what happened with us at that advisory firm We all got sort of distracted, working with really cool companies

28:21 that we met in the process of doing our work. But there is a lot

28:31 of natural curiosity in me that sort of leads me down that more traditional investment banking path,

28:38 just deals, deals, deals. I want to see lots of companies and I want to

28:43 help close a lot of deals And so that's. We're probably going to talk about BCP at some point in this conversation, but that's what brought me in with them. I brought you to me. So I think at some

28:58 point I do on Michael Toker to come on this podcast. He's very entertaining, talk about a straight shooter, that guy's hilarious, but effectively he's an investment banker here, and there is

29:13 a lot of technology that comes out of Calgary and the energy tech world, and having a resource there makes a lot of sense. But it's really interesting to see what Michael and his team are able to do,

29:25 because they operate almost at a different speed than the oil and gas industry does, yet that's how things seem to get done, right? So it's a very interesting means of watching it, like he seems

29:37 like somebody that should be in New York, you know? Totally, totally, yeah. Or in a movie about Wall Street Right, he lives in Boulder, right? You know, it's interesting. Everything's

29:49 untraditional in this space. So,

29:53 you know, one of the things that I wanna dive into a little bit, 'cause you touched on ESG and I feel like we should get there coming off of Karthik being on last week, which was a good listen Tim.

30:02 I actually listened to that right when it came out. Very good. 'Cause it was just an education and, you know, really, really smart. And I can even say this, and maybe it's because of80 oil over

30:12 the past two or three weeks I'm seeing a lot more activity amongst operators looking for solutions. And one of those solution areas is ESG. I think it's really emerging very fast. And maybe these

30:27 companies feel like their runways extended a little bit more now with oil and especially natural gas prices going up. What were you kind of seeing previously with ESG and what's your thought on it

30:38 going forward since you obviously pay attention to the flow of capital, no energy tech and no operators? Where's this all going, how fast is it going? I kind of want your viewpoint on the ESG

30:48 movement. Sure, so first of all, business journalists are trying to frame ESG as a new asset class.

30:56 Look, maybe one day, but right now, no, I don't think it is. It's a risk management framework

31:03 and a very good and elegant risk management framework.

31:08 Look, the reality is that businesses don't necessarily get rewarded or generate profit by doing the right thing, but it is a fact that doing the wrong thing comes with risk, right? And so ESG, as

31:24 a risk management framework, reflects the new reality where we have this world that's full of interconnected people who all have opinions and either approve or don't approve of each other's actions.

31:37 And that's led to this sort of neat little summary in three letters where.

31:43 People care about how businesses affect people socially. They care about how those businesses affect the environment. And they care about how those businesses govern themselves. And those are

31:56 important considerations. And the risk of falling short of the public's expectations or stakeholder expectations on any of those three verticals needs to be measured and it needs to be mitigated.

32:09 And so on the mitigation side, that's sort of where we come in as stewards of capital. There's a lot of investing activity or sometimes divesting activity that needs to be done in order to manage,

32:22 say, environmental risk. And so to get to the other part of your question, the way I've seen it evolve is in sort of naturally - it's been in bite-sized pieces when I joined Darcy in 2018.

32:42 you know, a big part of the model is asking operators, hey, what are your problems and don't be shy? Like let's get technical here. Casing, deformation, waxing, what is it? So, actually

32:51 those are two real examples of problems that came up in 2019. And then it was like, you know, we're paying too much for fracksend. You know, what can we do about that? So some more sort of

33:01 ambitious, kind of market-based questions. And then towards the end

33:07 of 2019, from one of the majors here in Calgary, who was one of my biggest clients, you know, I got this email with just a whole bunch of questions. And these questions had come out of a C-suite

33:19 meeting. And basically, they just wanted to

33:25 completely eliminate

33:28 any risk that methane emissions pose to their business. You know, they just had enough of the whole methane risk thing, looming over them. And so, you know, then it was time to go out and find,

33:40 you know, leak detection. vendors that lead detection innovators who could help them mitigate that risk. So that was sort of one of the first warning shots over the bow where a Canadian, like a

33:50 major Canadian community said, Yeah, we're going to put serious resources to this. And it was probably the first time that I had actually seen the wordemissions used in an explicit request for

34:04 business. And so that was, you know, at the end of 2019, at the same time there were a ton of pressures coming from the commodity market, right? Sure. I can't remember what the spread between

34:17 WCS and WTI was at the time, but it was wide.

34:23 And so there were a lot of bells in the air and a lot of challenges to suddenly understand and calculate, you know, and then COVID hit. And all of a sudden, you know, everyone was sort of

34:37 pointing at the oil and gas industry for one reason or another. either the public was demonizing and saying, these companies are responsible for the climate crisis. But within the capital market,

34:50 investors were also pointing the finger and saying, you've destroyed our capital. And that hurts, man. That's a brutal sentence. So

35:01 there was talk of what was going to happen to these companies, where

35:07 for the entire time that I had been tuned in to the oil and gas industry. Wall Street loved initial production rates, IPs were king.

35:18 And then all of a sudden, the industry was like, all right, so are we going to be a self-liquidating cash flow model now, like

35:26 having to just pivot like that and respond in real time to these really dramatic swings among stakeholders and markets? So, it was a tumultuous time, and. then there was a ton of risk to measure

35:43 and monitor and understand. So I think that sort of brings us to now where companies are starting to

35:55 gain vision into what

35:59 role they're gonna play in the broader energy space in the next five, 10, 20, 30 years. And what kind of investment decisions they're gonna have to make in order to set themselves up to be

36:11 profitable and sustainable through that time. Yeah, one of the things that concerns me as a observer of some of this, well, first of all, I am fascinated by when did it switch from HSC to

36:25 ESG, which is kind of, so did the H just go away, or is that rolled up in there somewhere? But go ahead, you're gonna. Probably. That's right, that's right, somewhere under the S's No, we

36:37 don't care about health anymore. Yeah, yeah. You know, one of the things that concerns me I worry about is companies that make a big bold statement. We're gonna be net zero by whatever date or

36:49 we're gonna reduce emissions by 50 by this date. And what we're seeing is some of them do that simply by divesting of an asset that's using a lot of compression or, you know, maybe an oil sands

37:04 asset that has to use a lot of heat. So they're gonna divest of this And so their ESG is satisfied, but all they really did was shift it over to somebody else. And without actually making any

37:16 impact on the climate at all, all they did was shift it to another operator that may not be as conscious as they are about something. I don't know if you have comments on that, but one of the

37:25 things that really concerns me, 'cause we saw BP exit Alaska. And one of the things they talked about was ESG or getting rid of emissions get everyone one of their biggest emissions generating

37:38 properties. And well, they sold it to, you know, another American company that's operating it for profit and doing quite well, but they became the number one emitter in Alaska as a result. Yeah.

37:50 So it's kind of, it's just interesting to me that shift that did we really accomplish anything by doing that?

37:58 Well, yeah, that's a really interesting way of sort of phrasing the question.

38:04 I think.

38:06 I'll take interesting good, thank you Yeah, yeah, I think in some sense, this is almost like a really sort of large-scale case study into game theory, like to use an economic term, right? Sure,

38:19 true. So typically when you think game theory, you think like, oh, it's about market collusion and oligopolistic competition. But

38:28 there are also instances where.

38:32 Let me put this a different way. If everyone in the world who has an opinion about climate change and the energy industry. Took 15 minutes and watched some like YouTube videos about game theory and

38:43 what it really means. They might gain an understanding of how complicated it is

38:50 to pivot your business model when you're baked in to such a legacy industry or market as

38:58 fossil fuels. So it's not a simple decision to divest an asset like that for the reasons that you're highlighting. I would argue that it's even harder though and I think this is kind of what you

39:14 were getting at Tim. I would argue that it's even harder to make the decision to invest in something that diversifies your portfolio.

39:24 And I can tell you with experience that

39:30 those decisions come with basically like an endless stream of variables that you couldn't predict You know, and. each one of those costs money to address and to process. It is a really risky

39:46 decision when you're managing other people's money, which assembly corporate managers are, to deploy that money and take bets on new business verticals.

40:00 And so that actually kind of brings me to another point though. I want to talk about the investors for a sec, right? So the financial investors, but particularly the ones that we interact with at

40:14 BCP, right? We focus on the lower-mid PE. market. So we're talking smaller private equity and infrastructure firms as well as family offices, who write the five to20 million checks kind of thing.

40:28 They're in a really tough spot right now. And I feel like in the context of this topic, That isn't, it might not be disgusting. you know, because when we get into these conversations with, you

40:44 know, with critics of the industry, you know, climate change activists, people like that, you know, there's this sort of, there's a sort of big picture kind of filtering that needs to be done

40:57 in order to get to the bottom of the problem where people say like, why aren't we switching to renewable energy? It's like, well, who's we? And so then you identify all these different energy

41:05 companies that are stuck in these markets with baked in frameworks and blah, blah, blah And then they say, OK, so whatever. One thing leads to another, and then you figure out that it comes down

41:14 to the capital market, right? The flow of capital. Do ENPs have adequate capital to invest and absorb the risk associated with investing in new types of assets, like renewables? So everyone wants

41:26 a throat to choke, and everyone wants a bad guy to point at and say, OK, so it's this investor that's just holding up all the capital, and now things can't get done. Let me tell you something

41:35 about those investors, OK? They are faced with an impossible task right

41:42 now. We all like to imagine

41:46 the greedy 1er with the slick back hair, the gourd gecko type, who's just like, no, this is my money, I've earned it, I'm not gonna, I don't care about your ESG agenda, I don't have to do good

41:56 things with it. So I'm not gonna - Show me the money. Yeah, show me the money, right? Dude, let's step away from Hollywood ideas for a sec The truth is that

42:07 the people who work for or run those institutional investment firms that I mentioned, they have a fiduciary responsibility to their investors. And those investors are people like you and me, right?

42:20 We're talking about our savings, amassed in the financial services or investment management industry. And they, on the one hand, trust me, I speak to these investment managers every day. They

42:35 understand the urgency. And they understand that the pressures and the momentum toward sustainable or ESG-oriented investing. And they don't have any personal problems with it or vices. It more

42:52 just boils down to the fact that first and foremost, they are obligated to invest their investors' money, their investors' capital in

43:01 the most responsible way possible, which means getting the best bang for your buck when weighing risk in return. And

43:12 as long as we're talking about the importance of doing the right thing, I think any sensible investor would just look at you and say, well, tie the two sides together for me. Show me how doing the

43:24 right thing fulfills my responsibility to my investor, and I'll do it

43:34 And so, you know, it's important that, you know, I guess people like us, the three of us on this podcast, do what we can to help guide capital and innovation to the right places and make that

43:47 market a reality so that investment managers and corporate managers can make those decisions on the basis of

43:56 a real market where real money flows and real things get done. Does that make sense? Yeah Yeah,

44:05 it makes a ton of sense and I'm very kind of ticked off and we got to it at the very end of this thing, really. We could go on another half hour just on this, I think. Yeah, we've been talking

44:15 about a panel or something too, just I think that might be a way we go in one of these future episodes. But yeah, we're coming up on about 45 minutes. Tim, did you have any other questions that

44:28 you had burning from Mr. Woods? Well, I didn't want to, you know, so a little bit lighter side So BCG was at boreus capital.

44:36 PCP, sorry, which is hard for me to be in the P at the end, that gets me every time, but you know. I'm also fun futures, right? I'm also fun futures. Yeah, well, I see that. You know, the

44:46 thing that strikes me, and it always,

44:49 there is no typical path so far in interviewing people for this podcast, there's no typical path into this industry. There's such a, we think that it's, you know, people who grew up in Houston

45:05 just go right into the oil and gas business, and that's how everything goes.

45:10 So it's fascinating to me to see how you get to this point and how you navigate to now, you know, this expertise in capital investing and ESG advising. It's just, it's a fascinating study really.

45:24 Yeah, no question. Yeah,

45:28 I mean, Darren, I really appreciate your views into this. I mean, I think that you have a pretty well rounded background to. to come into view this, sympathizing with the innovator, the

45:38 investor, and the operator, right? I don't think everybody has the ability to see things that way, usually it's just one of those windows, but I think that's a valuable means of looking into ESG

45:50 and how it affects everyone, right? In this whole ecosystem.

45:56 Final question I had for you, Tim, are we thinking socks in six or seven? You know, I think this is a seven gamer, quite honestly. And I think, and you know, this is Astro's talk now, but

46:11 with McCullers being out or possibly being out. So just don't, yeah, my attitude's changed. I'm not nearly as optimistic as I was. Like you guys are better. Tampa was better too though than us.

46:23 I don't know. I mean, it's the October's different, man. Hey, look. The October's the different. Alabama was better than AM. Oh, not on Saturday. You gotta play that game You have to play

46:34 the games. That's that's all there is to it. I looked, I thought about jetting down there. I mean, come on the games Friday and Saturday and Houston go down real quick, but I'm not, I'll be

46:43 down for energy tech night instead. Hopefully get to see you there. I think it's the 27th on a Wednesday. I'm personally excited to go to that and hopefully digital walkouts at some point start

46:53 bringing those events to Canada as well because it seems like there's a ton of interest in them down here. Oh, it would play well in Canada. It really well. I think so. It really would. Indeed.

47:03 So Calgary's got to let us in. We can't come up there right now. Like that's just locked down. That needs

47:13 to change soon. I wish I could help you.

47:17 January, January minus 40. That's when we need to have it. Energy Tech night when it's minus 40 in January and Calgary. No, thanks. Darren, where can people find you, man? What's the best way,

47:29 LinkedIn or any business profiles, things like that? Find me on LinkedIn. You can

47:35 And you can always check out the Fun Futures website, I think I'm up on there, or just Google Boris Capital Partners, I'm up on there as well, but yeah, just sort of my closing remark. We're

47:47 almost kind of talking about it and joking around about the weather and stuff, but creating a nice fluid marketplace between the US and Canada for energy innovation and energy capital to flow.

47:59 That's pretty integral. That's pretty integral for the energy transition to the rollout in a way that works for everybody Here in North America, so me being up here in Canada and working almost

48:10 primarily, actually yes, working primarily with stateside companies like, excuse me, Fun Futures, you know, that's a big part of what I'm trying to do. The role I'm trying to play here is

48:23 create more connectivity between our two countries. You do it well as a connector math, you really do. Thanks so much, Mr. Woods. Thank you, Dan. Have a good weekend.