Showing Energy the Way

Brothers turn training into livelihood

news_12-01-08_picFor PDF version Click Here

Valden teamed with his brother, Ted Valdez (Valden changed his name when he was 18), to found a business that trains right of way agents and contracts them out to energy companies to map the way for pipelines.”

“I thought, this is the first time I was really in on the beginning of something,” said Valden, now age 50. “I was in real estate, but I was getting in on the end of that.”

The brothers’ company, Texas Right of Way Associates, now has a stable of more than 50 agents and annual revenues topping $6 million, with offices in Fort Worth, Weatherford and Shreveport. The family business — Valden is chief executive officer, Valdez president, and several other family members work there — has expanded to also train and provide title agents as well as hire surveyors
for contract. They also have a separate company,
American Pipeline Construction LLC, that actually builds pipelines.

“We’re full-service — we do right of way acquisition,
land title, training, survey and construction,” said Valden. “We’re a turn-key operation.”

TRWA has contracts with 10 of the 15 largest drilling companies in the Barnett Shale. EOG Resources is among those who have used and appreciated the services.

“They have taken on a task that is important, and that no one else has, and that is educating people to do the work,’’ said David Frye, land manager for EOG’s eastern Barnett division. “Without the training that they’ve performed, there’s not a chance that there would be enough qualified agents.”

In addition to having the first such business in the Barnett Shale, Valden and Valdez also believe it is the only Hispanic-owned oil and gas service company in the area. They note it only as a source of pride. Their ethnicity hasn’t been an obstacle to starting their business or succeeding in the booming gas play, they said.

Despite the smooth sailing, Valden wasn’t so sure when he was younger that his race wouldn’t be a problem. At age 18, he followed the lead of two of his uncles who changed their surnames (one from Lopez to Spain, the other from Lopez to Logan) out of concerns that bigotry could affect their careers. Originally named Don Valdez, he traded the “z” in Valdez for an “n.”

“My uncles believed they would get more work,” Valden said. “I saw that it would probably be a problem, especially in Texas and so close to Mexico. It wasn’t as multicultural as it is now. It’s different now. That’s why my brother never changed his name. He’s 13 years younger.”

Valdez, age 37, agreed. “It has never been an issue. It’s all about building relationships by providing our clients good, quality people,” he said. “But there is a lack of bilingual agents that can articulate our clients’ intentions and communicate our clients’ plans for their property.”

Early on, it was clear the boys had Barnett-size capitalist ambitions. When Valden was 14, he set up pinball machines and a soft drink machine in his garage. He relieved his friends and others of their coins, to the tune of about $1,500 a month. Valdez was about 12 when he undertook his first financial venture, stenciling street address numbers on curbs for $10.

“It was pretty lucrative for about five minutes of
work. I was probably making $200 to $300 a week,” Valdez recalled.

Valden earned an associate degree in business and marketing and studied at the Texas Real Estate Institute, never taking his license exam. But

he bought and sold properties on the side while he worked as a right of way agent. He also briefly owned Nitwits Comedy and Magic Club in Arlington in the 1980s and for a while he promoted professional boxing in North Texas, spurred by his uncle Paul Reyes Sr.’s success as a boxing trainer. Among Reyes’ clients were former world champions Paulie Ayala and Donald Curry.
“I’ve always had a business on the side making money,” Valden said.

news_12-01-08_pic2Valden, a married father of four daughters, has been a right of way agent for 27 years, but spent most of that time traveling around the country tending to projects. Seeing the potential of the Barnett Shale — and a near-home career — he went to work for Devon Energy in 2003 and joined in the earliest lateral drilling projects in the Barnett.

“Then everybody learned the drilling techniques and secrets that Devon was doing, and all these other energy companies started coming in,” Valden said.

Seeing the need for agents, Valden and Valdez started TRWA agent training classes in 2005. Valdez welcomed the partnership. After earning a public relations/marketing degree from Texas Tech, he worked for an Internet company in Phoenix that went bust along with the technology industry bubble in 2001. Then, after Texas deregulated the electric
industry, Valdez and a friend created a business in which they negotiated electricity contracts for large commercial users. “

I didn’t really have any equity in the company,’’ said Valdez, who married last year and has a new son. “I helped him grow it, but it was his investment. With my brother, it’s 50-50.”

Valden was glad to get him. “He’s my brother. Who can you trust if you can’t trust your family? And he’s a very smart young man,” Valden said.

The brothers didn’t take a paycheck for the first eight months, reinvesting everything into the company. The staff grew with the business, and the half-dozen family employees include their mother, Peggy Valdez, and their father, Joe Valdez, who retired from General Motors after 42 years on a Friday and started working for his sons the following Monday.

Right of Way Experts
The first class started with 10 to 15 students, but enrollment quickly grew. In March of this year, TRWA moved into the 3,500-square-foot Barnett Shale Training Center at 925 University Drive in Fort Worth. The one-day, $275 classes now consist of about 60 students who learn about issues with rights of way, engineering, real estate evaluation, pipeline construction and property
negotiations.

Last year, TRWA started offering a six-hour, $250 class on researching ownership of surface titles. Now there is a two-day, $500 field training course at drill and pipeline construction sites to teach the routine duties of an agent.

As part of the all the classes, TRWA presents resumes of its students to clients in the oil and gas industry. Agents can make $150 to $600 a day, depending on experience and position, Valden said. He added that the training is unique to working in the Barnett Shale, because of the type of drilling required. It also deals with right of way issues stemming from more widespread drilling and pipeline building in urban areas.

“In the past you might have one landowner to deal with per mile, and now you might have 500,” said Frye of EOG. “Certainly, every contact is a potential conflict.”

By Robert Cadwallader, Special Correspondent for
Fort Worth Basin Oil & Gas Magazine .