The Energy Pipeline · 2026-06-24 · 51 min
Key moments - from our scoring
Substance score
47 / 100
Five dimensions, 20 points each
Marshall Dodson, president and CEO of Key Energy Services for 21 years, discusses what drives authentic leadership in the oilfield and how to navigate the extreme volatility of well servicing. Key Energy Services is a workover rig and ancillary equipment provider focused on short-cycle barrels - the maintenance and workover activity that moderates decline on existing wells. Dodson explains how the industry has rationalized through a punishing decade (2016-2024), with attrition eliminating marginal players and poorly-capitalized entrants. He argues the market has bottomed and the next peak could exceed previous cycles for the first time. The conversation touches on industry cycles, the violence of revenue swings (25-50% year-over-year volatility), hiring discipline during booms, and the massive opportunity in recovering trapped oil - currently only 6-10% of reserves are extracted from unconventional wells. Dodson emphasizes management by walking around, keeping fixed costs low even during upswings, and staying focused on what you do best (workover rigs) rather than chasing every service line. The episode includes discussion of his background at Arthur Andersen, Dynegy (power generation and gas trading), and lessons from surviving prior cycles.
Marshall Dodson emphasizes authenticity - being genuinely yourself rather than maintaining a fake persona, which people can see through. He focuses on being where the people are (15 of 16 field locations have staff) and using management by walking around to stay connected to reality rather than relying on filtered reports.
Keep fixed costs and committed contracts as low as possible even during booms, avoid multi-year contracts you can't exit, stay lean, and focus only on what you do best rather than diversifying into every service line. This allows you to pivot quickly when the cycle turns.
Short-cycle barrel work - workover and maintenance activity on existing wells - offers the best cash-on-cash returns for operators. Additionally, with only 6-10% of oil recovered from unconventional wells currently, there's a massive future opportunity to improve recovery rates through recompletions and workovers.
Industries can destroy capital for a decade before consolidating; the shift from conventional to unconventional plays, coupled with attrition of under-capitalized competitors and equipment scrap-down, has eliminated marginal players and created a healthier market structure where the next peak could exceed prior cycles for the first time.
Our reviewer’s read on each dimension, with quotes from the episode.
There are genuine operational insights scattered throughout - the market rationalization thesis, the flat-price-per-hour reality destroying returns, and the AI commodity-cycle parallel - but they are heavily diluted by extended personal anecdotes, mutual admiration, and wandering banter that consumes the majority of runtime. Real ideas appear roughly once every 8-10 minutes.
a third of an emp company is geared to squeezing out vendors right like supply chain organizations are huge and they exist for the logistics and everything that needs to go but they also really work to ensure that they are getting the best deal
our price per hour that we charge a customer is about the same as it was uh ten years ago in most basins and the inflation and the cost has just destroyed the returns
The data-center-as-commodity-capital-boom parallel drawn to shale, gas power gen, fiber optic, and cattle industries is a legitimately fresh and grounded frame; the 'Ask Bob' institutional-knowledge-preservation use case is a concrete original application. Most of the leadership content, however, is standard authenticity and boots-on-ground fare.
you can go back to the cattle industry and all the money that was raised and flooded that that ultimately collapsed it because you're producing a commodity so i don't question ai i don't question the value uh proposition on that but i question how much of the value is going to be captured in the data centers
industries can destroy capital for a decade before they finally kind of get together and get their act together
Marshall Dodson is a genuine operator - 21 years at a publicly traded oilfield services company, former CFO, has navigated a bankruptcy and out-of-court restructuring, and speaks with hard-won cycle experience rather than thought-leader abstraction. Solid practitioner caliber, constrained somewhat by the conversational format preventing full depth.
twenty one years
we did a bankruptcy in twenty sixteen and coming out
A handful of real numbers appear - 1,500 employees, fewer than 50 in Houston, flat hourly rates over a decade, 35%/50% labor-cost thresholds, 50-year employee tenure, deductible reduction from camera program - but many claims rest on vague timeframes, approximations, and personal anecdote rather than cited data or hard financials.
we've got fifteen hundred ish people and less than fifty in houston so the action's out there
if we had yards where the cost of labor was at thirty five percent of revenue we'd look at shutting it down right like it was you know these economics are whacked
The host is a self-described friend and colleague of the guest and it shows throughout: questions are vague or multi-part with guest left to choose direction, follow-ups are rare, claims go unchallenged, and the host frequently redirects to his own stories or self-congratulation rather than pressing for depth. The format reads as a friendly PR conversation.
i could ask another phenomenal question about key and give you another home run to hit but i personally
choose your own adventure would you like to talk about the future of wealth servicing energy demand and the bigger picture which is kind of cool because your shorts like um or the energy perspective which what would you like to talk about
Computed from the transcript - who did the talking, and the words that came up most.
What does it take to rebuild and reposition an oilfield services company in one of the industry’s most challenging markets? On The Energy Pipeline, sponsored by Cat Oil & Gas, host Josh Lowrey sits down with Marshall Dodson, President and CEO of Key Energy Services, to discuss the company’s transformation, strategic focus, and vision for the future. Dodson shares how Key Energy is returning to its core strengths, navigating industry cycles, leveraging technology to improve safety and preserve institutional knowledge, and building a culture focused on excellence, authenticity, and long-term value creation.
Transcribed and scored by The B2B Podcast Index.
Speaker A: welcome to the energy pipeline podcast sponsored by caterpillar my name is josh lowry we are coming to you live from the upright digital uh media studios in praying and associates office in memorial texas i am joined by a friend and colleague in the business president and ceo of key energy services mister marshall dodson
Speaker B: how are you sir i'm doing well how about yourself marshall we've been talking
Speaker A: a couple minutes offline um i didn't say this offline because it would sound weird if i said that and then i said it again but there are very few people we interview that i get excited i like interviewing everybody by the way former guests thank you for your time but i have a ton of respect for you as a person as a professional as a business leader as a mentor for myself um from one hundred different levels and uh this is one of these podcasts for me that's going to be really cool to do um i hope the audience kind of hears the sincerity of me introducing marshall on this because number one you should follow us marshall looks way better congrats on those socks by the way
Speaker B: yeah well we do have the two hundred fifty uh the celebration yeah the
Speaker A: two hundred fifty years of america yep
Speaker B: and we just had memorial day so
Speaker A: those are american flag socks he looks great he's on point uh i look like i'm wearing a pink and salmon today i look great too don't get me wrong you look amazing but uh this is gonna be a great one um i met marshall in london close to a decade ago probably eight nine years ago at this point and really got to know you over there and i said something to marshall and i and i was like hey i don't hope this doesn't come across rude and i said you know you don't you don't look the part of your the typical ceo the six foot five guy and but you command the room you lead a bunch of people i said how do you how do you do that and i i told you offline we were going to ask who's marshall dotson i guess this is how i'm asking it how do you just boom by the way this is the best podcast you're ever going to be on absolutely yeah i our friend david derode
Speaker B: he may take exception to that well
Speaker A: i hope he does i hope he takes a lot of exception this is
Speaker B: better but go on yeah no i uh gosh i remember that but i don't remember what i said but the answer is i think a big part of leadership and doing that is being authentic um just being who you are you see people who come across in certain ways but it's hard to maintain a fake persona at all times and i think just being real and being who you are is very powerful you see so many times these days where people try to try to uh god what's the like influencers where they try to be something they're not correct grifters yeah and i think people can see through that when you're not authentic and when you don't really care well the
Speaker A: gist of your answer then was that you really like work well i do
Speaker B: like work yeah no uh i do like work it took me many many years for my wife to convince me that leaving the office at seven was not leaving early oh right you know uh seven o' clock is not leaving
Speaker A: or you're not cheating the company yeah
Speaker B: no yeah and it will still be
Speaker A: there tomorrow you know there's always something
Speaker B: to do there's always something to do well i mean always work if you
Speaker A: want to as you've climbed and look you've been with key for how long
Speaker B: twenty one years
Speaker A: it again it's not really this is not fluff i wonder the loyalty and the commitment and the work for q with key key doesn't look the same without marshall over the last twenty one years there's like i almost feel like you you're like what needs to be done i'll do it
Speaker B: yeah no it's been uh it's been an interesting time yeah i've been through several cycles a lot of different leaders um learned a lot of different things and even going back before that with with my career you know worked with so many different people and you learn good and you learn bad too and it's a lot i mean i've made plenty of mistakes um but it's a lot more fun to learn from other people's mistakes um than your own mistakes um living through those kind of times you you you just learn um you know when you're twenty five or thirty five and you you know well you need more experience i don't really know what that means until you've got the scars yeah right until you've got the scars and you've got the perspective on what matters and what really doesn't matter
Speaker A: you know well i mean again you've you've got some scars but they're good scars at this point i mean it kind of that lends itself to can you give the audience um this is the caterpillar podcast and look they are phenomenal partners on this show there they said basically interview anybody within the pipeline anything within oil and gas so they've given us a lot of creative freedom to kind of touch anything we want from technology well servicing frack just whatever um and i would but so this is a pretty educated audience not pretty this is a very educated audience for oil and gas but do you mind just giving us a scoop on what
Speaker B: key energy services is yeah so today um we are uh a well services company with workover rigs and then a full suite of ancillary equipment around the rig um so we have the rig itself as well as the boil preventer accumulator um lay down machines um what else pumps all kinds of different pumps um big frac pumps mud pumps everything you need to do everything needed to either you know drill out a four mile lateral horizontal well to drill out the plugs to pulling rods and changing a pump on a five barrel a day stripper well which people haven't been doing but hopefully with higher oil prices that'll make sense to do that okay uh over over keith's history we've been in just about every kind of service you can imagine we've had frac m we've had wire line we've had drilling we've had uh vac trucks fluid saltwater disposal and you know as i when i took over key uh coiled tubing you know i was very focused on getting us down to our core right the the economics and what we do are very challenging and they have been for the past decades probably not as challenging but still challenging before that but if you're limited on human and financial capital you need to focus that at what you're best at um right and so it's just been a process of moving in and selling off and getting out of businesses that we're not known for when people in the oil field think of key workover rates right
Speaker A: it's incredible so i'm going to go back again to that first conversation coming back from london i asked you i said what would you tell me because i i met you guys um i met key in zero seven when i was selling drill pipe you guys were in that world at that time we still
Speaker B: have tubulars but yeah okay with that
Speaker A: well i'm not the i've since zero nine i left the tubular world um it was a good run to be there though that was a fun time to be in that world um and i so i asked you in twenty seventeen eighteen time frame i said what would you like to be known marshall how would you like key to be known and you said if i could just get people to think well service rig anytime they think well service rig they think key is that still the
Speaker B: case yeah that's definitely the case uh it's really hard to really be great at a lot of things and uh there have been times key's been the biggest where we haven't been the biggest where we are the biggest i'm not interested in being the biggest i want to be the best i want to be the best and i want to have the best people doing the best work for our customers charge a premium price for that sure but uh you know it's about being the best
Speaker A: is it hard to get a premium price
Speaker B: these days it's getting easier okay um you know it's always hard look when you think about oil and gas companies and the way those organizations uh a uh third of an emp company is geared to squeezing out vendors right like supply chain organizations are huge and they exist for the logistics and everything that needs to go but they also really work to ensure that they are getting the best deal some lowest cost some best value
Speaker A: so audience i want to be very clear there was no prep work here for marshall and what's incredible
Speaker B: but we can edit right we can
Speaker A: edit but oh i love talking to myself caterpillar told me that they think i talk too much you don't talk too much well for the record i like to talk well i know that i'm my favorite subject yes you should
Speaker B: do your own like josh and josh
Speaker A: podcast you can interview yourself josh and josh josh how you feeling today pretty good josh thanks for asking so but my point to this um is it is incredible how this matches up to twenty eighteen like everything you're saying today this is not materially different than it was what is eight nine years ago now i just don't hear anything that's not only does it not sound different i've actually watched you in those eight nine years um you keep mentioning people we're gonna we're gonna touch on people for an extended period of time because i feel like i feel like you've done a great job what is it
Speaker B: bob chitwood bob uh yes yes is
Speaker A: he still with you guys no bob
Speaker B: is retired he retired but he was
Speaker A: with you guys a long time oh
Speaker B: yeah bob bob was fifty years icky was he really if you if you count and there was he could get it to fifty one if he wanted
Speaker A: to yeah with his math with his first year where i was yeah fifty years fifty years man that is a
Speaker B: run yeah we've had we just had another gentleman retire in the permian base and he was fifty one years with key with predecessor companies key's been around as key for forty six forty seven years right but key was a roll up right yeah one hundred ten plus companies that made key
Speaker A: all right well hang on a minute so we're gonna we're gonna go into the people side of this real quick what do you what do you think the thread of fifty years ago to now what's the common thread there so
Speaker B: this this is a cyclical business right and it's a business that has been consolidated deconsolidated or not deconsolidated i guess that's one way to put it where you have a lot of different market entrants come in um yeah it's funny i was i was thinking back this was uh because you know for for for us we did a bankruptcy in twenty sixteen and
Speaker A: coming out how many other companies well
Speaker B: like everybody right and another out of court restructuring like most uh i don't
Speaker A: remember anything happening in twenty twenty yeah
Speaker B: but but as opposed to many of those other companies key still around right um and i was thinking about a conversation i had with an investor this was probably twenty eighteen twenty nineteen and we're talking about the the woeful state of oilfield service of well servicing and he looks at me and he's like you know industries can destroy capital for a decade before they finally kind of get together and get their act together and uh i remember thinking and i probably said it out loud oh great we're halfway through right but as i look at it today we're coming out of you know it's been about a decade and the market has rationalized um quite a bit um in terms of the number of players um the booms in the bus not everybody has made
Speaker A: it through um right size i mean you say rationalize right size as well i mean we're where we need to
Speaker B: be now and you've had a lot of attrition with the equipment you know i think we've we've been cutting up all of our junky old rigs most of our competitors have as well and so when i look at the market today it's very different and then the other dynamic is you know if you think back to twenty sixteen to now you had a shift going on where you know operators were moving to more horizontals unconventional plays and they were slowly uh uh exiting the traditional horizontal wells and so i think that shift has been kind of uh completed because in the cycles the next peak after the down cycle was never as high as the prior never as high as the prior never as high as the prior
Speaker A: um yeah the upticks were shorter yeah
Speaker B: but i think in our space and in services in general i think the markets have gotten to the point through attrition to where the next peak is probably going be as high right like we kind of bottomed as an industry and i think we'll come to where we were and when i look at the landscape of just more and more wells i think that the possibility is definitely there for a higher peak than
Speaker A: last time so you're telling me that you are a believer in the reports that say that these the new wells are going to be drilled this next twelve months whatever the number is right that you think this next twelve months is going to be pretty good for
Speaker B: the industry uh i would say the next eighteen eighteen months because i forget
Speaker A: where we are right now yeah you
Speaker B: got to remember we're in the somewhere in the we're having having an agreement tomorrow oil prices are going to drop like a rock uh the other side is it's going to be dollar two hundred a barrel most people are just sitting back and saying i don't know what's going to happen i'm going to
Speaker A: wait so don't don't leave we're going to come right back to that here um the next day i'm going to put eighteen months on this but how long have you actually been in the oil and gas business twenty one at
Speaker B: key oh i was at a company called dynogy um which was a uh uh we had power generation we did gas trading yeah um so i had a stint on the trading side and with power gen which is a fascinating space was then yeah fascinating today um and then prior to that i was with arthur anderson and arthur anderson in houston when i started there you could do oil and gas and everything else so oil and gas so the reason
Speaker A: i'm asking that is the way you just kind of described the next eighteen months one day you're doing this one like that sounds almost violent it's very
Speaker B: violent yeah like there are very few industries where you know for most consumer products most mature industries if you get a two percent drop in two or three percent drop in revenues year on year that can be catastrophic right like that's big fifty percent twenty five percent yeah whatever right like that's the whole
Speaker A: team's got it five percent right yeah
Speaker B: up down twenty five thirty fifty percent you know that's that's this industry what
Speaker A: is it like leading in that kind
Speaker B: of environment you know you you have to uh you're kind of always looking for when the shoe's going to drop right like i can remember i have a good friend and one of the upcycles he uh uh he started a man camp in south texas and um he's talking to me about this and how great it's going to be and all the contracts he was getting and i was like jeff just one thing so do not sign a contract that commits you do not sign a contract you can't get out of because when it turns off the lights go out and you're stuck holding the bag on all those contracts and then a couple years later guess what happened the lights the lights go out is he not
Speaker A: an oil and gas guy before that
Speaker B: no and he came to me afterwards he was like thank you that was the best advice i've ever gotten because one day it was full the next day it wasn't and uh i was like but i have a contract with you and the oil company was like yeah and come get it yeah yeah
Speaker A: and so we can outlast you yeah
Speaker B: so uh yeah uh he made it through and didn't lose it all again because he didn't have any contracts you
Speaker A: know my dad described it slightly different he said hiring people is easy mhm he's like firing people is hard well and he was talking about emotionally quite
Speaker B: honestly yeah yeah you get you know it's like every hire we make over kind of the low point in the back of your mind it's like this may be someone i have to have to cut when it goes down do i really need that can i can i do something else can i reallocate the work can i think of a different way to do it to keep my fixed costs down right because you never know when it's going to turn down so exactly so you have to be as lean in the in the best of times as you are in
Speaker A: the worst of times all right so this is david road can't do this i'm going back to my question okay um your eighteen months question so now that you think we are in a bit of an eighteen month uptick here and you feel like where are we in that stage still violent yeah no
Speaker B: we're early early days right like you know remember this is where june yep and uh the bombs started dropping in march right and so by the way
Speaker A: he means actual bombs not just bad
Speaker B: news yeah i know this is the straight of hormuz is closed like as of now we're in this weird we're going to have a peace deal tomorrow crude craters yet everybody's saying we're going to run out it's going to be dollar two hundred nobody has any idea right um but you know we we with what we do at short cycle barrels right like work over maintenance that kind of thing we moved into april may phone started ringing really within the past month kind of mid may to now um the phone started ringing we had to go from from you know defense when oil was fifty bucks to offense now um got a big hiring event in midland tomorrow which unfortunately i can't make um but it's it's that pivot you know within thirty days right you know what are we going to do how are we going to get more rigs out how are we going to you know do this it's it's it's challenging which means you have to you just have to stay lean um but i i am of the opinion that we're not going back to fifty dollars right and and that we're going to be at a at a reasonable price for this industry for you know at least the next couple years i
Speaker A: like that term short cycle barrel i feel like that benefits a company like
Speaker B: you tremendously we are yeah um you know work over maintenance can be some of the best return dollars an emp spends in terms of you know cash and then we get their money back and make a return on that the problem is it's a lot of it is not the big you know thousand barrel a day well right like it's one hundred one hundred barrel a day well or fifty you win games so it takes too it takes a lot yeah and moderating decline is is something that's very important and then as i look out and think about you know all the oil that's left in place with all of these uh uh unconventional wells you know someone will figure out how to go back in and get that right if you if you think if you think it's they're getting i've heard six i've heard ten percent of the oil out right i i have no doubt that there's not an engineer somewhere that is figuring out how do i get it to fifteen how do i get it to to uh twenty right and that's massive volume absolutely i
Speaker A: that is audience i mean this is we're not going out on you know real thin branches here but what he just said i believe is such an opportunity for when people talk about what's next that you know data we're gonna talk data centers all that stuff but gathering and capturing the trapped oil and gas yeah that they think is well we've already got that it's a declining it's you know we're on the wherever we are on the tail here let's go to the next one type stuff because they have shareholders that they have
Speaker B: to report to as well you think about like when i first started at key in two thousand five and i made my first trip out to the permian basin there were hardly any drilling rigs going right it was a mature basin um you know but everybody figured out how do i squeeze the last drop of hydrocarbons out of this well right like that was the the easy money was was years ago and then it was you know really technical engineering how do i get the last drop out of this well and we're early days in that you know i remember
Speaker A: two thousand six seven eight probably seven um you know we my family's been in fracking pretty much the whole time and i went to a conference and they were talking about this is what's going to change what you just said and they were talking about shale and fracking and we were selling fluid ends at that time but nobody really knew it because we were it was quiet it was in fort worth that's really
Speaker B: two places everybody was fracking conventional wells it was just to open up the zone it wasn't what we were doing
Speaker A: but those were different types of yeats right yeah and it uh wasn't the high pressure stuff that they were using today um and i will never forget a guy from the middle east was at this conference and you know it's kind of q and a uh and he stands up and he's like you guys are lying you're doing this because that's oh i know when it was it was two thousand seven uh eight when the prices were going to one hundred and four dollars a barrel he's like he goes we think this is all propaganda to pressure us to pump more oil out of the middle east he's like you're not going to find this much gas that you think you are here in the states with quote unquote shale and i'm like i don't know man i feel like they're about to find uh and sure enough again i'm sure there were other people in the room they were like this guy doesn't really understand what's coming their way how much competition the us is about to be because we weren't competitors we
Speaker B: were importers yeah no i mean the cheniere facility was to import not to export right which was a great pivot to be able to export we got
Speaker A: tons of gas tons of gas well um what am i missing here because i want to talk about you briefly talked about your hiring event um i believe you're a would you describe yourself as a boots on the ground ceo
Speaker B: i have been described as a boots on the ground ceo okay i tend to think of it more that's where the people are that's where i should be right like there's we've got fifteen hundred ish people and less than fifty in houston so the action's out there right and uh i'm a big believer in the uh what are the boasts call it management by walking around right like eyes on to see what's really going on um because you can't fix what you don't see and uh i've i've given this i've said this before but i'll repeat it um it was on somebody else's podcast but but when i when i when i uh i'll never forget i got promoted to vice president i was at dynaji and told uh my parents and they're like great let's go have dinner we go to dinner and my dad's like haha you're a mushroom now and i was like what do you mean dad and he's like well you're kept in the dark and fed bs right which is how they grow mushrooms right and it's very true that the higher you get up the ladder the further you are away and everything you get is filtered not even necessarily consciously right but no one wants to give the raw details of what's going on and so uh i like to look see feel touch here and you know you have to take with a grain of salt right and do it in a way that is not stepping on or over your managers but do it in a way so you get the raw unvarnished truth of
Speaker A: what's happening well i hope i'm not i don't think i am with the story you know telling untold stories but we were out in um midland for the barbecue and it was the day i guess probably the day before the barbecue so we were kind of everyone sitting um at the restaurant across from the hotel and you and i were the only two at this one table kind of waiting on some people to show up and it was you know called six pm happy hour type thing and all of a sudden these two guys came up and they said mister dodson and you looked at him you're like yeah they go i'm so and so and i'm so and so we work for you here and they go we just started but we recognize you and it was very clear that marshall dotson had become mister dotson instantly like you were still genuine you weren't anybody different but you turned you started talking to these guys and you were two or three minutes into it i realized this is not going to be a three minute conversation like you were where are you guys from what do you do how'd you get here when did we start how do we train and i'm like oh man this is not he's not asking peripheral questions here like he's wanting to know are you guys doing your job how can i help you what is going on and i just i ended up walking away and you're with these guys for fifteen twenty minutes yeah and i and i thought two things number one how quickly you checked into these guys which was awesome because and my second thought was with fifteen hundred employees you you really can't
Speaker B: be off no no and it's exhausting i can you wouldn't think talking to people wears you out but it does
Speaker A: you know that yeah well uh yeah
Speaker B: because you got to be on point but but i'll ask you this like when was the last time you applied for a job at upright to see what that's like right or any one of the companies you have to see what that experience is like right is it hard to apply and get a job there did somebody call you back um you know if you used a fake name which i've done occasionally um
Speaker A: but that's a great to see if you're going to call back yeah see
Speaker B: if they call me back see if i get a return call um did
Speaker A: you get a return call yeah i
Speaker B: did good eventually we've got a good process now but we had some pretty weak systems initially um but yeah no the other analogy i'll say is that the further you get up the ladder the harder it is to see what the experience is at the bottom and that experience at the bottom those are your front line those are the people at key interacting with our customers those are the people that we expect to to follow the process to work safely and do a great job um but if you're not if you don't feel valued as you come through you know how do you what do you think about that company and how does that make you buy into what they want you to do right so yeah i've i've i've gone in and jobs dot com filled it out right um well
Speaker A: i mean that's that's a job aspect of it but you're very big on safety you do videos you do you know you're engaging i've seen you know there's there's new technologies today whether they're gps tracking cameras in the cars um these aren't for big brother no you know i don't care what you're talking about right i care that you're focused on the road and i've seen people engage you know not necessarily from key but just other companies with a marshall dodson thread and it's like hey good luck with that big brother type thing and you're like well actually yeah you
Speaker B: should explain why yes right explain why like it's not there to spy on you you know don't care what well i do care what you're doing in the car but if you sit in the in the truck and eat lunch nobody's going to watch you but you know driving is one where we've we've been you know no one brings bad habits of nippling up a bop to the oil field right but we all bring bad habits of driving and so how do we break bad habits it's through constant coaching correction right being mindful of it and then making adjustments because like it's it's it's it's hard enough worrying about your own employees getting hurt on location but when you worry about your employees hurting someone else right right you know big human element to that also big financial element to that because we don't make that much money so
Speaker A: have you seen your uh activities i mean has there been improvement oh it's
Speaker B: been it's been huge improvement really yeah no it's it's been phenomenal i mean we you know we actually we were able to have our um the deductible reduced at key right and this is a company that you know uh we uh you know i've been chewed out by uh many many people in london for uh you know derailing trains or
Speaker A: i'm not laughing at that part i'm laughing i know the hidden that's great
Speaker B: yeah but no we've had such a great track record and we've been at it for like three years now and people when i when we first started doing it i asked people what do you think about the cameras you know they would complain like look we're not doing sound we only watch and and now when i ask uh and always do what do you think of the cameras and truck and they're like you know i actually find myself driving the speed limit stopping at stop signs when i'm off work too i had one guy say he was driving along and his wife was like why are you driving so slow he's like i'm going
Speaker A: the speed limit you know it is an amazing thing where you know if you get on a facebook neighbor page and just people complain which is my favorite thing to do i like to go on facebook marketplace and just low bid everything and then see what my neighbors are complaining about but you know there was somebody complaining about why does everybody back in in houston and my m immediate thought was because some sixty percent of these people work for oil and gas companies and they've been trained
Speaker B: to back in it's also easier to park a pickup truck that way well fair but but yeah that was uh you know i i do a lot of social uh media posts and and kind of talk about all the things we have going on but my biggest linkedin post which had over fifty thousand views um i uh i was walking to the courtyard in odessa from the restaurant across the parking lot by myself as i do many times and i look out and i see an entire row of white trucks backed in with one pulled in uh front you know pulled in and so i took a picture and i said who's not in the oil field in odessa correct that was so fun this guy doesn't work for us yeah he obviously is not oil field because everybody else is isn't
Speaker A: that crazy yeah they know it you
Speaker B: just you just get in the habit
Speaker A: um we're gonna i want to go to talk about technology here in a minute but i've got a couple things here i'm gonna let you this is choose your own adventure would you like to talk about the future of wealth servicing energy demand and the bigger picture which is kind of cool because your shorts like um or the energy perspective which what would you like to talk about there see how great this podcast is yeah throw you do that yeah he shoves it down your throat he's like now this is welcome to this podcast yeah thank you caterpillar yeah thank
Speaker B: you caterpillar this is awesome thank you for the great engines we used to uh sky smooth the uh what were
Speaker A: those again just pick one well i feel like i know the future well servicing really does sound pretty good what i've heard it sounds it sounds domestic centered it sounds like there's if you have the quality product on demand and you can do a job then a good well servicing company is going to be in a good situation you'll always
Speaker B: need well servicing you always need well servicing whether or not you make money doing it that's that's on you that's the challenge right right you know our when i when i look at you know like going back ten years ago um if we had uh called them yards then not districts but if we had yards where the cost of labor was at thirty five percent of revenue we'd look at shutting it down right like it was you know these economics are whacked we're obviously not making a return on the equipment we need to shut it down move today if we get that at fifty percent we're doing high fives our price per hour that we charge a customer is about the same as it was uh ten years ago in most basins and the inflation and the cost has just destroyed the returns we're all doing fine because every company in this business has either been through bankruptcy and written down their equipment like we have or they bought it out of bankruptcy or distress situation so gaap earnings yeah you got pbt um but cash and the earning of return on the capital invested nowhere near what
Speaker A: is pbt profit before tax what is
Speaker B: it profit before tax you got ebitda adjusted ebitda pbt pat net income peanut butter toast yeah we got all kinds
Speaker A: of acronyms uh this is not the financial podcast sorry that's our john daniel podcast okay yeah um we have something for everyone have you been on the john and with john i have they're great yeah my favorite thing that john and bill do no introduction just cameras on marshall question number one yeah and i'm like john i go give the audience something yeah he's like no i don't by the way i love i couldn't love john we do he's awesome
Speaker B: he's amazing but i got to tell you after you know almost ten years as a public company cfo yeah you get uh immune to that kind of thing you sit down at the table there's no perfunctories it's well you said this margins and you know you can't answer the question because they're asking you for you know non public so you gotta say what you want to say
Speaker A: work your way around it yeah so i my other joke recently and i don't know if this is a joke nobody wants to go to dinner with me anymore because i talk about nothing but ai and peptides that's it those are my two subjects these days we're not going to go down the peptide rabbit hole here um but by your answer i'll be talking to you about that later now that you say that um and secondly ai data call it i'm saying ai is kind of all inclusive it's a joke that i say but really data centers power behind the meter the grid that world is changing it's my other kind of comment that i say to people is that nothing has benefited oil and gas more than tiktok and what i mean by that is if oil and gas companies would have said to the us consumer we're going to need more energy for lights they'd have been like you make too much money you're not you get nothing more they would have helped you'd have gotten no support instead they were like i want more videos on my phone and i want to post immediately from anywhere in the world and without a hiccup and because it's social media it's kind of a clean innocent thing and california needs it so bad i feel like energy and oil and gas companies are just getting this wave of kind of help from other industries for the first time in a long time i
Speaker B: agree i mean i think we have our industry has a bad rap and or has historically and if you think about it no one begrudges the thousand dollar phone that you have right you think about everything we buy prices all that kind of stuff but almost every person in the united states goes to the goes to the gas station every week every other week and fills up and you see that price and you have to have that fuel correct you cannot get by without that fuel and so there there a becomes like a sense of almost entitlement like why is it going up right like it comes from the pump right why is it why why are why am i being charged i flipped it up and held it down why am i being charged more right without any idea of the capital that was risk to go find that and to deliver it to them amazingly so cheap um so i think that the demand on the power side which is we all know the only way to meet that demand is with gas and gas turbines and all the different technologies around that everything else is intermittent or too far off um but yeah it puts us in more of a hero seat for now correct um
Speaker A: but you say for now um okay that that lends another question are you one of these i don't mean to say it like that are you of the ai as a bubble person or are you of the we're at the beginning of a an ai revolution data
Speaker B: revolution so the application of ai not a bubble right real value creation possibility i question the capital going into the data centers right like i just step back and i look and i see a capital i see capital just running after these returns right to create what is ultimately a commodity right the compute is a commodity right like different chips you know different configurations data centers i'm moving my hands and i feel trapped um but they better be watching you know and you think about that and you think about all the other capital booms that we've had right when you look historically you've got a land rush going on you've got everybody tripping over themselves to build these data centers right and you think about shale right everybody was the returns will come production is what matters get it get it get it the returns will come when you when you think about my days at dynojee with gas fired power gen right get it the returns will come we've got a powerpoint that shows it's going to be x in um ten years okay great um a little bit different with the fiber optic cable and the boom that led to that um but you can go back to the cattle industry and all the money that was raised and flooded that that ultimately collapsed it because you're producing a commodity so i don't question ai i don't question the value uh proposition on that but i question how much of the value is going to be captured in the data centers right and how much of the value is going to be captured by the software versus the use of the software and i think people today are putting a lot of value on that into the agents themselves and the softwares themselves that's not where the value is created the value is created in companies and so when you think about how much money am i going to spend on tokens to get x output right that hasn't really been solved for right so so i've got a lot of questions on the economics uh but none on the utility i mean we're we're doing some things with ai we've seen you know and i don't mean just making like funny pictures and chat gpt right which is fun but if you think about it um you know that's that's all great at what is it like ten dollars a month fifteen dollars a month depends yeah one hundred and fifty dollars a month are you are you or are people spending that to make funny dog videos no well
Speaker A: yeah you're talking about the individual right
Speaker B: but it's the same thing with if i spend one hundred thousand dollars a year on tokens to replace my admin am i really better off doing that or would i rather have a person like where's that break even on some things i think ai today is excellent at math and excellent at coding and things like that it's a lot harder to apply it to different things at least in my experience so far no
Speaker A: i don't think you're far off you say different things i mean really i'm going to tighten that up a little bit to say because i think you're saying into an applicable use case for
Speaker B: your company so you brought up bob chetwood um you know i had a vision a while back um i was like wouldn't it be great if we could create a voice to text tool so that every uh work plan at key was done in essence with bob chitwood standing there and so uh we set out to create a uh basically a work planning tool somewhat of a reference and we call it ask bob right so i love it yeah and it's got like the little logo app kind of looks like bob i bet he loved that by the way i probably should tell him about it i'm kidding i told him about the name um but uh you know it sounds easy right like oh you just load all your stuff in there and it gives you an answer no it's not because um it want most of the agents out there most of it wants to please right and so it will try to find an answer and so getting everything right because we're talking about people's lives yeah right like this high risk stuff and if ah and if it doesn't ask the right questions if it doesn't stop and say wait i don't have enough information to answer that yeah we can't let me have a fake answer here yeah and there's tons of fake answers we're getting initially and so it's been really it's taken a lot of effort to train it we're probably a couple months away from launching it um but even nothing off the shelf gets you know tex mex spanish right which is which is not spanglish yeah and and and and uh you know what in in the oil field everything should have has multiple names right wells have multiple names every tool we have multiple names they have multiple names in english and spanish right and and getting through all of that has been challenging and that's that's just reps right
Speaker A: um but i love that little that's one of those things where only carnal knowledge can tell you that what you just said yeah because i could say hey i can fix your ai my thing understands spanish not this spanish no
Speaker B: not this spanish where you say something to me in spanish i say something back to you in english i give you two english words and a spanish word it struggles with that and our guys in new mexico which is part of the permian basin have a different word for a bop than the spanish word for a bop in west texas which is different than south texas right and so we got to capture all that and so it's it's just time and getting reps at the system um but it's not that easy my favorite
Speaker A: is when you go to new mexico and they start talking about the permian and they're like well you know east texas east texas and i'm like east texas this doesn't make what are they talking about well they're talking about east of new mexico m and it took me i mean you know you click in but every single time they would say something and i feel like they're talking about west texas they're not talking about talking about the haynesville correct like they're talking about west texas they're just about east of this and it's just an amazing you know we have you guys have people moving all over the place at all times um well i had other great questions here what do i want to know marshall what do i want what do you want the people to know before i deliver some phenomenal question have i asked so many
Speaker B: great questions that you are such a
Speaker A: great viewer um you know honaru brought up that ask bob mhm i never put two two together that that was bob chitwick yeah that's great yeah but
Speaker B: but the vision is you know one of the one of the challenges we face in the oil field today and remember like years ago people talked about the great shift change that was coming well we're at the end of the great shift change i can't believe that and so there's so much knowledge that that is left and that is leaving and so tools to help um make sure people know the right questions to ask and they're talking about the right hazards uh is this a fair question
Speaker A: to ask key um are there technologies that not just ai techno are there technologies you guys are working on to bring in and are you rewarded for new technologies or are you rewarded for consistent safe work every single day like
Speaker B: what's uh yes and no okay um there are some very um progressive vmps out there willing to invest um to change the dynamic of the industry um but it comes back to economics right so so we can we can automate what we do but no one's going to pay four times the current hourly rate to do that because you're not any faster yeah um and what will people pay for so so so there you know people are like well drilling rigs in this and fracs this and i'm like okay you know yeah but we don't have the same economics and that ultimately drives a lot of those cap if if i can't make a return on a conventional rig today if it costs three times as much i really can't make a return i mean i make a you make a return but not a not a market acceptable return not where you'd want to put
Speaker A: capital so marshall i could ask another phenomenal question about key and give you another home run to hit but i personally i don't i believe that companies are the sum of the people that work for them and i started this podcast the way i'm going to end this that i think and um you and i had a conversation years ago i said look the the more the industry can get to know marshall dotson the better it is for you the industry key etcetera i would like in caterpillar great audience great listenership and great
Speaker B: culture culture is ultimately incredible what matters
Speaker A: it's one hundred year old company yeah it's yeah and they're acting like they just started and you're like how are you guys doing this around the world mining construction oil and gas you know that is you know they're in their engine world right now is the envy of every engine company out there yeah no their their culture is just great but they've been great with this so you know i do want i would love to get a last piece of you know what what is a piece of advice that you can give our audience marshall that is something that you've learned to over your career your history your time as ceo your time as a husband father whatever you want to say wow that yeah i want because i just feel that you're not everyone's going to get forty five minutes with marshall dodson and they're not going to get to know you over an eight year period and i've seen you do this i mean i've just seen it and i want people to know something about you to where they're like i'm going to give key a shot i'm going to send a fake name in to ask for a job like marshall did because you know i want to work for this guy so um there
Speaker B: you go wow uh that's a big mandate um i'm not exactly sure where to take that one i think i'll start in one place and then go to another place so when you talk about business i am very much a believer that businesses are the sum um of the people involved in the business right and jim weckland's very big on culture and i completely agree that the culture is really what sets the company up and cultures are bigger than the individuals but they're set by the leadership right and um setting that right culture getting people to do the right thing when no one's watching getting them to own what they do um when no one else is around is a huge challenge um and as i think about my career and that learning coming about you know one of my first observations was we all buy the same stuff right like every service company out there buys the same stuff so what sets you apart and it's your culture right and what is culture culture is people and so uh it's it's trying to create ultimately i want key to be the place people wish they could get a job and if i succeed in that then everything else should take care of itself right like i want it to be the place where man if i got on a key i'd be doing great yeah um but i'll take it to a different place because you know in terms of uh personal advice and learnings over time i'm a big believer that you learn through repetition whether it is playing lacrosse and and just how many times you you uh you know are out in the yard with the sticks right to to business how many how many times you know you do a task how many challenges you face how many problems you solve all of that builds the muscle memory and uh you know it's like uh like when i when my daughter started working i had a conversation with her i said look bailey you know you're just starting off your first year at work right and and you got forty hours a week but if you work sixty and the person next to you works forty at the end of the year you've had a year and a half of reps they've had one year two years you've had three years of reps you know they've had two and it just grows exponentially and so you know it's hard to find i don't think culturally we're at the place where that's celebrated and i think to some degree like with myself it became unhealthy right like too much um but finding that right balance of really diving in and getting that experience um because the easiest way to get that next job is to be doing it before the promotion's there right like you really need to be doing your boss's job to be in that in that job and the only way you can do that is to start doing it before you're there and the only way you can do that is to get people below you doing what you're doing right or you work a lot it's generally a combination of the two but if you think about your own career you didn't know what that next step was like until you started doing it right and the only way you have the time to do that is you have great people like here in the studio and your whole team who can take those tasks off of you and allow you to move into the next role before it's
Speaker A: really there for you well that is a great answer and speaking of good teammates uh i offered i said honoro your boss is honoro works for upright digital he's been with us for close to five years absolutely love honoro and but he's awesome he's awesome he does a lot of work you know he does work for you guys around you guys barbecue et cetera and i said hey hinaro your boss is going to be on the podcast tomorrow you want to come in he's like i can't i got stuff going on he goes make sure you treat him right tell him hello so um well listen marshall i should have said this at the beginning it's keenergy dot com keenergy key energy dot com uh no www yeah that's why we've learned haven't we that was early on we always joked that we could tell hold somebody's when they would say www dot key energy i'm like you don't need the ww they get it so thank you for your time we wish you guys i mean listen this is folks you know this is not a i'm not doing a commercial for key i'm doing a commercial for consistency quite honestly for saying what you're going to do and doing what you say and thank you for your time thank you for coming on the caterpillar energy pipeline podcast um folks that's going to wrap us up for today if you want to check us out on any of our socials we are on youtube you need to go to the www dot caterpillar oilandgas and they've got the way that they index all of their podcasts is incredible they do i mean they're caterpillar yeah caterpillar they know what they're doing and uh they've got any subject you want to talk about from well servicing to drilling etcetera and this one will be up in the next couple days here so thank
Speaker B: you very much marshall thank you for having me really enjoy the conversation before
Speaker A: we let you go i do remember now it was it was david you and victoria were giving me some crap
Speaker B: just a little bit they just hit
Speaker A: their hundredth episode really they just did their one hundredth episode yeah so you were we kind of robbed you but you were back on there late last year though weren't you yeah yeah okay so yeah you're out there don't worry about it i was going to reinvite
Speaker B: you but invite revoke i was early remember you ambushed me into that podcast told me we'd go taste tequila and
Speaker A: then you said hey none of that
Speaker B: sounds familiar why don't you come on
Speaker A: the pod none of that sounds familiar um marshall dotson thank you for everything thank you guys the best of luck thank you
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