Back in the early 1990s, a group of Oklahoma oilmen embarked on an endeavor like no other. They wanted to tell a different story about oil and natural gas. Not the negative one that had plagued the headlines for so long and tarnished the reputation of their beloved state; they were proud of what the oil and natural gas industry was doing for Oklahoma. And, they wanted to tell their true story.

It was a story of an industry that was, and still is, the backbone of this state; that provided millions of dollars in taxes for roads and schools. And, it was a story of an industry they were proud and honored to serve.

Their idea was simple and innovative. Oklahoma’s oil and natural gas producers and royalty owners imposed a voluntary assessment on themselves, and the Oklahoma Energy Resources Board was born.

Now, 18 years later, the OERB has used these contributions to put one-of-a-kind environmental restoration and energy education programs into place in Oklahoma and helped others across the nation model their own programs. These flagship programs show the industry’s dedication to excellence in Oklahoma and elsewhere.

2011 was a remarkable year for the OERB, reaching nearly 11,500 restored well sites and

spending $68 million on the effort. Using new resources in geo-mapping software, the OERB is increasing the number of abandoned well sites it can identify in a single year.

We are equally proud of our student education efforts and the more than $20 million dedicated to its success. Across this grand prairie, school children are getting state-of-the-art science and energy education unmatched in any other state. The more than 12,000 Oklahoma teachers trained to use the OERB curricula not only give students a basic and fundamental understanding of scientific processes, but also an important understanding of the oil and natural gas history that has made this state what it is today.

We are grateful to the energy producers and leaders whose pioneering spirit and vision paved the way for the OERB nearly two decades ago. We are proud to carry forth their mission in the state of Oklahoma.

We do not do these things because we expect a pat on the back or a handshake in the hallway. We do these things because we’re proud of our industry. We are Oklahoma Proud.

We are grateful to the energy producers and leaders Whose pioneering spirit and vision paved the Way for the oerB nearly tWo decades ago.

throughout this annual report, you’ll find “Qr codes.” using a Qr code reader app, you can access additional video content through any smart phone or taBlet device. these videos can also Be vieWed in the neWs & media section of oerB.com.

We are proud to carry forth their mission in the state of Oklahoma.

OERB year in review

terry J. adamson – BP America, Inc. Adamson is Director of Regulatory Compliance and Environment for BP America Production Company in Houston, Texas. Adamson holds a master’s degree in public health from the University of Oklahoma and a bachelor’s degree from Kansas State University. Adamson is chairman of OERB’s Environmental Restoration Committee and serves on the Executive Committee.

mark aeBi – ConocoPhillips

Aebi is Manager, Legacy Issues Risk Management and Remediation Group for ConocoPhillips based in Bartlesville, Oklahoma. Aebi graduated from Oklahoma State University with a bachelor’s degree in petroleum engineering technology. He is a member of the National Society of Petroleum Engineers. Aebi serves as a member of the OERB Environmental Restoration Committee.

pete BroWn – Cimarron Production Company, Inc. and Brown & Borelli, Inc. Brown is co-owner of Brown & Borelli, Inc. and Cimarron Production Co., Inc., both exploration and production companies in Kingfisher and Oklahoma City, respectively. Brown is a graduate of the University of Oklahoma with a Bachelor of Business Administration in petroleum land management. Brown is past chairman of the board and presently serves as chairman of the Public Education Committee.

mike cantrell – Cantrell Investments and Domestic Energy Producers Alliance Cantrell is one of the co-founders of the OERB. Along with being the current President of Cantrell Investments, LLC in Ada, Cantrell is working as president of the Domestic Energy Producers Alliance, a nationwide collaboration of oil and natural gas producers, royalty owners and trade associations working together to influence U.S. domestic oil and natural gas issues. This is his second round of service on the OERB board of directors. Cantrell previously served from 1992 to 2003 and is a former chairman. He serves on the Public Education Committee.

david house – Chairman of the BoardHouse is a Tulsa-based independent producer and president of Jireh Resources, LLC. He has

more than 30 years experience in the exploration and production business working at both large

independents and smaller start-up organizations. He has extensive experience in the financial

and commercial aspects of the industry.

House is a current board member and past chairman of the Oklahoma Independent Petroleum

Association and former board member and president of the Natural Gas Association of Oklahoma.

House holds a Bachelor of Science in accounting from Harding University and is a CPA.

phil cook – Devon Energy Corporation

Cook is Vice President of Production/Operations for Devon Energy’s Central Division in Oklahoma City. Cook received his Bachelor of Science degree in mineral engineering (petroleum) in 1984 from the University of Alabama, and a Master of Business Administration-Finance degree from the University of Houston. Cook currently serves on both the OERB Environmental Restoration and Public Education Committees.

mike cross – Michael P. Cross, Inc. Cross is President and owner of Michael P. Cross, Inc., an independent oil and natural gas production company. Cross received his bachelor’s degree in business administration from Oklahoma State University in 1973. Cross was named the Oklahoma Independent Petroleum Association Member of the Year in 1998 and currently serves on OIPA’s Executive Committee. Cross is chairman of the OERB’s Administrative Committee and also serves on the Executive Committee.

Bill gifford – DCP Midstream

Gifford is Vice President, Mid-continent Region, of DCP Midstream LP, which is a partnership owned by Spectra Energy Corporation and ConocoPhillips. Gifford is a native of Kansas and received a bachelor’s degree in chemical engineering from the University of Kansas. He currently also serves on the Oklahoma Marginal Well Commission.

thomas goresen – Anadarko Petroleum

Goresen is the Senior Counsel for Anadarko Petroleum. In 1977, he graduated from the State University of New York at Albany with a Bachelor of Science degree in business administration/management. In 1981, he earned a Juris Doctor with High Distinction from Oklahoma City University School of Law. Goresen serves on the OERB’s Environmental Restoration Committee.

LEADERSHIP

leadership

economic impact

russell Johnson, iii – JEC Operating, LLC

Johnson is the CEO of JEC Operating, LLC in Oklahoma City and was co-founder of Johnson Exploration Company in 1981. Johnson is a graduate of the University of Oklahoma with a Bachelor of Business Administration degree in finance. He served our country in the U.S. Navy from 1973 to 1976 as a commissioned officer. Johnson also serves as a board member for the Oklahoma Independent Petroleum Association and on OIPA’s legislative and crude oil committees.

roBert v. Johnston – Apache Corporation

Johnston is the Vice President and General Manager for Apache Corporation’s Central Region. Johnston holds a bachelor’s degree in geology from the University of Tulsa. He previously served on the OERB board of directors from 2003 to 2006.

sam langford – Newfield Exploration

Langford became General Manager of Newfield Exploration Mid-Continent with offices in Tulsa, Oklahoma during March 2011. He holds a Bachelor of Science degree in mechanical engineering from Auburn.

dale malody – Marathon Oil Company

Malody is Operations Manager for Marathon Oil Company in Oklahoma City. Malody was born in Laramie, Wyoming in 1957 and lived in Wyoming throughout his childhood prior to attending the University of Wyoming. Malody graduated in 1979 with a Bachelor of Science degree in mathematics.

tim munson – Spartan Resources, LLC Munson serves as Exploration Manager for Spartan Resources, LLC in Oklahoma City. Munson began his involvement with the OERB in 2000 volunteering as a Petro Pro. Since then, he has assisted the OERB in development of various curricula and programs. Currently, he serves as the chairman of the Scholastic Outreach Committee. Munson earned both a bachelor’s and a master’s degree in geology from West Texas State University.

garrett phelan – Sunoco Logistics Partners

Phelan serves as Senior Crude Oil Representative for Sunoco Logistics Partners, located in Tulsa. Phelan is a Tulsa native and holds a bachelor’s degree in accounting. He also earned a Master of Business Administration degree from Arizona State University.

John pilkington, Jr. – Muirfield Resources, Inc. Pilkington serves as president of Tulsa-based Muirfield Resources, an independent oil and natural gas exploration company. Pilkington was born and raised in Tulsa and spent more than 20 years as a banker before entering the energy industry in the late 1970s. Pilkington has been involved with the OERB for several years, serving as a member of the Public Education Committee prior to his appointment to the board.

Will Whitley – Chevron North America Exploration & Production

Whitley currently serves as Consulting Production Engineer for Chevron North America Exploration and Production. Whitley graduated from Texas Tech University in 1982 with a Bachelor of Science degree in petroleum engineering. Whitley serves on the OERB’s Scholastic Outreach Committee.

ronnie irani – OERB Vice Chairman Irani is President and CEO of RKI Exploration & Production.

Irani earned his Bachelor of Science degree in chemistry from

Bombay University in India. He also holds a bachelor’s and a

master’s degree in petroleum engineering from the University

of Oklahoma and a Master of Business Administration degree

from Oklahoma City University. This past year, his company

was named the fastest growing, privately-owned company in

the Oklahoma City metropolitan area.

Julie s. kruger – OERB Secretary Kruger manages oil and natural gas

properties for JMW, LLC, and the Trust of

Raleigh W. Shade in Tulsa. Kruger holds

a degree in petroleum land management

from the University of Texas. She is the

OERB’s royalty owner representative.

suzette hatfield – OERB Treasurer Hatfield is co-owner of Rio Dinero, LLC,

a holding company based in Oklahoma

City. She has received several awards for

environmental advocacy and coalition

building from groups such as the Sierra Club,

Oklahoma Wildlife Federation and the League

of Women Voters. Hatfield is also chair of the

OERB’s Accounting Committee.

to Be giving oklahoma’s students a stronger foundation

in math and science.

We’re proud

EDUCATION

Public Education

I WIll :60

We belIeve :60

Dewar Public Schools teacher Joe Fowler might be one of the best spokesmen the OERB has.

“The OERB has partnered with education to provide resources and materials to reach our students, and help school budgets by the equipment they provide,” said Fowler.

It just so happens, the OERB takes pride in making sure our Oklahoma teachers are well-equipped to provide science and energy education to their students. Through the use of eight OERB curricula, more than 12,000 teachers in 95 percent of the school districts across the state are learning about oil and natural gas through scientific methods and processes.

“This curriculum will give the students a better understanding of the importance of fossil fuels in our lives,” said Judy Clark, a teacher at Guthrie Upper Elementary School. “All the activities are certainly doable, and I am excited to try them with my students.”

Educators rave about the amount of free supplies and field trips the OERB gives to them.

“In today’s economy, help with field trips is wonderful and much appreciated,” said Darcey Austin, teacher at Garfield Elementary in Ponca City.

Sooner Rose Elementary (OKC) teacher Stephanie Strilding says the OERB’s program is like no other. “It’s the only workshop I know of that you get a free field trip,” said Strilding.

during the 2010-11 school year, the oerB provided 1,455 teachers With more than $445,000 in classroom supplies. another $335,000 helped pay for field trip transportation costs and museum admission.

“It’s very teacher and student

friendly and so easy to use.

Everything is done for you.

You just have to teach the

lessons. They’re adapted for

different ages and the students

can’t wait to do each activity,”

said Tracey Purdum, a teacher

at Will Rogers Junior High

School in Claremore.

Some teachers say their students would never learn about many science methods were it not for the assistance from the OERB.

since 1996, the oklahoma energy resources Board has dedicated more than $20 million to help make education in the state of oklahoma Better.

This past year, the OERB released its third book in the Petro Pete’s Adventure Series, titled Boomer Burrow. The book brings together OERB’s well-known characters Petro Pete, his dog RePete and a forest full of fun creatures as they all learn how to clean up the environment.

“I truly love this book series,” said Dr. Gayla Wright, OERB Curricula Coordinator. “The students really love the characters and it helps them really get into the story and pay attention to the lessons.”

Wright says having the storybooks helps round out the energy curricula the OERB provides to teachers.

“Many of the OERB curricula are based in science and math and these books add reading and comprehension skills,” said Wright.

Each Adventure Series book provides an important lesson or information for children. The series started with The Road to Petroville in 2008, which recounted the state’s petroleum history. Then, the OERB released What’s the Risk? The Story of a Fuelless Boy in 2009. That second book taught young readers about products made from petroleum as well as the important lesson of well site safety.

Boomer Burrow is book three in a series about Petro Pete’s adventures across Oklahoma, discovering how the industry impacts our state through environmental stewardship and more.

Book launches in Oklahoma City and Tulsa.

In addition to curricula and field trips, OERB teachers use our fun and colorful children’s books as tools to teach important oil and natural gas-related messages to Oklahoma students.

EDUCATION

Whether during story-time or playtime, OERB students are always encouraged to talk to their peers about the dangers of playing around well sites. And, each year, we ask them to illustrate their message in a poster for our Well Site Safety Poster and Coloring Contest.

The 2011 safety contest attracted record entries. More than 1,900 third through sixth graders entered original posters while more than 3,500 kindergarten through second graders turned in coloring entries! That’s double the previous year’s entries! Winners of the contest were celebrated during a ceremony at the state capitol.

During an OERB-sponsored field trip to the Oklahoma History Museum, students, teachers and parents will see a brand new oil and natural gas exhibit due to open early 2012.

The OERB sponsors part of the new oil and natural gas history exhibit, which examines the industry since World War II and emphasizes the changes and innovations that occurred during this time. Part of this important history is how producers and royalty owners became focused on efforts to reclaim abandoned well sites and to educate the public.

The exhibit will include video pieces that tell the OERB story in three phases: environmental restoration, student education and the industry’s economic impact.

Each year students create posters to showcase their knowledge of well site safety.

EDUCATION

EQUIPPING OK STUDENTS

1 2 3 4

1. Braman Elementary 1st grade student Kyson Head poses in front of his winning Well Site Safety Coloring entry at the 2010 Well Site Safety Day.

2. Liberty Elementary 5th grader Katelyn Breedlove and her mom hang out with OERB mascot Petro Pete during Well Site Safety Day at the State Capitol.

3. Duke Elementary 2nd grade student Hayden Gramling shows off her Well Site Safety Coloring Contest entry.

4. Rep. William Fourkiller awards Maryetta Elementary 4th grader Aubrey Brown with a citation congratulating her on her win at the OERB’s eighth annual Well Site Safety Day.

EDUCATION

It was likely someone like a Petro Pro who inspired the 109 students who make up the OERB’s Petroleum Scholars to work toward a career in oil and natural gas.

The OERB supports students studying petroleum-related majors at the University of Oklahoma, Oklahoma State University and the University of Tulsa.

“The OERB scholarship has helped me not only financially, but also through networking opportunities. I know that in this industry, networking is a big part and OERB is helping us make those connections that will last a lifetime,” Mary Niles, OSU Geosciences Junior.

These students are some of the best and the brightest at these colleges and they are excited about what the future holds.

“I want to be in the oil and natural gas industry because of the opportunities it provides students. We have bright career prospects in just about any area we want,” Eric Weidermann, TU Energy Management Senior.

In 2011, the OERB added a section to its beloved Petro Pros program geared toward kindergarten through second grade students. Until now, the presentation was too advanced for students younger than third grade.

Petro Pros are industry professionals who volunteer their time to visit classrooms across the state. A Petro Pro delivers a hands-on, interactive presentation that focuses on science, the discovery of petroleum, well site safety and careers in the oil and natural gas industry.

“I’m very excited to participate in such a great program for the kids in our community,” said Jennifer James who works at DCP Midstream. “As the mother of a 4-year-old, I know just how eager young minds can be to learn. I think the positive impressions and lessons that kids remember for a lifetime begin at a very young age.”

The new K-2 Petro Pros activities include dressing OERB mascot Petro Pete for safety, flashcard exercises to learn vocabulary and a goodie bag filled with everyday items made from petroleum.

Clark Whisenant works in the industry and was inspired by his second grade son to volunteer.

“His grandpa and great-grandpa are both geologists. He loves learning about science and I hope to provide the same excitement about learning to other kids,” said Whisenant. “I’m looking forward to sharing with students the science behind many items they use and see every day.”

our safety message and other useful details aBout oil and natural gas, can noW reach oklahoma’s youngest students thanks to an expansion in the oerB’s petro pros program.

The University of Tulsa Director of Energy Management Ted Jacobs and scholars.

the oerB aWarded $350,000 in scholarships in 2011.

education

Faculty Focus

This year, we look back on some of the more than 11,500 well sites restored at absolutely no cost to landowners. We know these sites are not only a plot of land, but also a part of someone’s livelihood.

Oklahoma’s oil and natural gas producers and royalty owners have generously funded this effort and, this year, the OERB reached the milestone price tag of $68 million dollars spent on our restoration effort.

The goal behind every restoration is to return the land back to a useful state. And, for every landowner, that means something different.

For instance, on our very first project – the Busby Ranch in Pontotoc County – the landowners simply needed more pasture to graze their livestock. With deeply eroded land like the Busby’s, building a pond was the best course of action. In fact, since 1993, the OERB has built more than 300 ponds on various properties across the state.

The restoration of these abandoned well sites are profoundly personal to the OERB and its staff. What starts as a salt scar or ragged pipe one day, may just turn into the site of someone’s homestead or legacy landmark the next.

That is exactly what happened for Oklahoman Bruce Graham. Beneath the bricks and mortar he now calls home, once laid the scars and damage of an abandoned well site.

Mr. Graham wanted to build his new home on a plot of land in north Edmond. But, old, rusty pipe and soil tainted with years of untreated hydrocarbons stood between him and his future.

The OERB restoration removed the damaged soil and pipe, leaving behind the pristine plot of land that Graham now calls home.

Behind every restoration is a proud Oklahoman whose land is beautiful and productive again. And, the OERB is honored to make a difference for so many of our friends and neighbors.

after

Before

ENVIRONMENT

RESTORATION

PRESERVING OUR STATE

Other times, landowners have bigger plans for the property. In 2005, the Deer Creek School District called the OERB in preparation for building its new middle school. Before any work could begin, however, contractors removed heavy concrete and pipe and cleaned up a disposal pit. In a thank you letter to the OERB, the school district’s Director of Operations wrote:

“…(We) extend our sincere appreciation to you and OERB for your excellent work in cleaning up our new middle school lot…the property now is clean, beautiful and ready for use.”

Right now, work is nearly complete on that brand new middle school. The 157,000 square foot building will run on geothermal technology. Tennis courts, soccer fields, a softball field, a baseball field, a football field and a track will also fill up the 40-acre site.

Sometimes, a restoration project can have a lasting impact on the lives of countless citizens – like the Bricktown fire station project in downtown Oklahoma City. This restoration not only saved

taxpayers tens of thousands of dollars, but also paved the way for the construction of a state-of-the-art fire station that will serve the growing Bricktown area.

“OERB’s assistance and partnership with us on this aspect of this project saves us a significant amount of money,” said Oklahoma City Fire Chief Keith Bryant at the kick-off of the restoration. “Station 6 is steeped in history,” said Bryant. “It’s where eight of the city’s first 12 black firefighters worked after they were hired in 1951, so it made sense to build a mini museum here.”

the oerB is restoring, on average, tWo to three sites daily and it is estimated there are as many as 40,000 sites that still reQuire remediation.

The OERB Environmental Restoration team will continue its work hunting down sites across the state using geographical databases and aerial photographs, relying on its partnership with the field inspectors from the Oklahoma Corporation Commission and taking calls from the many Oklahomans across the state who reach out each day to report their abandoned well sites.

OERB’s 10,000th well site

restoration is now home to the

new Bricktown fire station.

Conducted by the Steven C. Agee Economic Research and Policy Institute at Oklahoma City University, the study examined the industry’s impact on the state’s job force and its economy.

“The oil and gas industry is still Oklahoma’s number one defining industry,” said Russell Evans, Executive Director of the Institute. “The industry is likely in a continuing boom period – even if modest – relative to pre-recession activity.”

While the industry continues to pay nearly one billion dollars annually in gross production taxes, it is important to note that its economic impact has a far greater reach. The report showed the industry’s annual operations generate $51.7 billion in Oklahoma goods and services – nearly one-third of Oklahoma’s gross state product.

“Economic development is the key to a strong Oklahoma. The indirect and induced jobs that the oil and natural gas industry provide are helping rural communities across our state thrive,” said Lt. Governor Todd Lamb.

OERB Chairman David House echoed this sentiment saying, “What is important to note today is that this industry remains committed to the state of Oklahoma and growing our industry right here.”

2011 brought a new OERB message to the airwaves, introducing one of the most important industry contributions to our state: OERB’s education program.

The latest television campaign takes a sneak peak inside classrooms, science labs and museums – places where the OERB is impacting Oklahoma education.

“There was a time when the restoration program was the OERB story,” said Pete Brown, OERB Public Education Committee Chairman. “But, the organization has grown dramatically over the last few years. Our student education efforts are making a major impact across the state.”

With the steady growth of OERB’s education program – reaching students from kindergarten through college – it was the perfect time to showcase the industry’s commitment to this effort.

“What we have been able to do over the last two decades is build a student education program that is first class in Oklahoma and is a model for other states to follow.”

Behind the scenes

Social media continues to be an ever-growing communications tool for the OERB.

During the weeklong television commercial shoot, a dedicated social media camera crew teamed up to catch behind-the-scenes footage.

These videos include time-lapse montages, confessionals, and one-on-one videos quizzing the talent and production crew about the oil and natural gas industry and the production itself. The videos allowed fans following the OERB through social media to catch the action in real-time. These videos are posted on the OERB’s Facebook and YouTube pages.

The strength and importance of the oil and natural gas industry was never so evident than in the last two years. While much of the nation was suffering economically, Oklahoma was surviving, thanks in part to a strong energy sector. Proof of that was found in an economic study commissioned by the OERB in 2011.

PUBLIC EDUCATION

PUBLIC EDUCATION

FB BEHIND THE SCENES

The report concluded that the industry provides:

71,224 direct JoBs

228,115 indirectly employed

$14 Billion in laBor income

As we proudly begin another year here at the OERB, we move forward excited to fulfill the mission that has been handed down to us.

We take our role as environmental stewards very seriously, and we are proud of our accomplishments to date. Yet, we know, thousands of sites await cleanup.

We are proud of our students. They demonstrate a love of learning. And, Oklahoma teachers are dedicated to delivering the OERB curricula to them.

Work is underway now to create updated and expanded curricula for Oklahoma teachers to keep active student minds challenged.

New tools are being developed for teachers across the state to use in their classrooms. These tools range from books to video games, and could be released later this year. The student education department is also examining the need to expand the PetroTech program to smaller communities around the state. This could help train Oklahoma’s military service people for new jobs as they return home from duty.

We are proud of the oil and natural gas industry’s strength and achievements. In the coming year, the OERB will continue to share stories of energy’s impact on both education and the economy.

You will also continue to hear about the milestones reached by this prestigious organization. We are very proud of our work and our commitment to fulfilling the mission set forth by the OERB board of directors nearly two decades ago.

Together, we all remain Oklahoma Proud.

3555 nW 58th street, suite 430

oklahoma city, ok 73112

WWW.oerB.com | 1-800-664-1301