COMPANY PROFILE: JUSTISS OIL COMPANY

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COMPANY PROFILE: JUSTISS OIL COMPANY

Aug 28, 2019

This article is the third in a series that will offer a closer look at some of the Louisiana businesses that have made a lasting impact on the oil and gas industry. 

 

James “Jick” Justiss Sr. (1946)

 

LaSalle Proud

You might say James “Jim” Justiss III was born with oil in his blood. His grandfather, James “Jick” Justiss Sr. started out as a muleskinner in the 1920s, moving oil and gas equipment in South Arkansas during the El Dorado boom. Jick was noticed by legendary Texas oilman H.L. Hunt, and would end up working for Hunt for many years managing his field operations. With that experience and a partner, Jick Justiss founded the Justiss-Mears Oil Company in Jena in 1946. The business thrived over the years and eventually his son James Justiss Jr. began working for the company — first as roughneck and toolpusher and later as president. Times were good during the late 1970s: two key acquisitions (Baker Tank Company and Altech) brought new oilfield vessel manufacturing capacity online and the company had 28 active drilling rigs. In 1980, Jick Justiss passed away and the Mears family opted to sell their share of the business, which was renamed Justiss Oil Company. The crash that rocked the industry in 1982 was a major challenge, but Jim Justiss Jr. managed to keep the business on track. Then, in 1990, Jim Justiss III joined the company as a geologist, eventually serving as VP of operations for many years. In 2013, he was named president, while his father became chairman of the board.

Today, Justiss Oil Company provides contract drilling, exploration and well and lease services across the Southern Gulf Coast from Texas to Alabama. Company President Jim Justiss III shares his thoughts on his company’s success, the nature of the oil and gas business and what he sees as the main challenges and opportunities for the future.


James “Jim” Justiss III, president of Justiss Oil Company

What’s the best advice you’ve gotten from your father and grandfather over the years?

If you don't like the way things are going, get out and work a little harder.

 

What do you think are the reasons for Justiss Oil Company’s success and longevity in this notoriously unpredictable industry?

We’ve always had a commitment to personal service with our customers. We don't screen calls: Customers, employees — anyone can call Justiss and speak to a manager or myself. We resolve problems more quickly that way. It also creates a sense of family for our employees because everyone is available to everyone else.

Financially, we’ve always maintained a strong balance sheet, and we take steps fairly soon in a downturn to protect it. During the most recent downturn, we all took paycuts, starting from the top down. Corporate management ceased dividends early on. We didn't take a job if it didn't stand a chance to have a positive cash flow for the company. When you are walking a tightrope, there is little margin for error. One bad decision by a good company can make the difference.

Over the years, we’ve had to become leaner and, unfortunately, that has sometimes meant layoffs. Since 2014, the number of people working in our main office has halved. We also don't run a super-complicated, long-range budget. We pride ourselves on being able to turn on a dime and take advantage of an opportunity when the opportunity arises. Sometimes it's as simple as counting our money, and evaluating the risk vs. reward of the endeavor. Staying out of debt has been key for us.

Our strategy has been to stay diversified: When all rigs are stacked in a downturn, operated production has helped carry us through. In past booms when equipment was in short supply, the services we provided were still accessible to us and our working interest partners.




Jena is a small town. Why has it been important for your family to keep the business there all these years?

We’re located very near our operations. Jena is located atop the LaSalle Arch, a prominent subsurface structure that influences production within the Central Louisiana Wilcox Trend. This production is what brought my grandfather here as an employee of Mr. H. L. Hunt. His knowledge of this shallow oil production is what gave him the confidence to start this business in 1946, but this is not the only, or even the main reason why we have chosen to stay here.

LaSalle Parish is home to many hard working people, not only in the oil industry, but other natural resources as well such as the pine timber industry. These two base industries have created a work ethic among the residents that spans generations.

 

What do you love about what you do? What motivates you?

There is a sense of adventure and discovery when participating in a prospect to be drilled. There is a sense of providing a product that ultimately increases the standard of living for our employees, our community, and the general public. We want to continue to provide this service to the place we live.

 

Some may have heard of Justiss because of the television show that filmed there a while back. How did you get involved in that and was it a good experience? Did it help Justiss as business?

I’ve had both positive and negative feedback regarding how the show reflected on the industry in Louisiana. I think, as an industry, we need to show our human side. Because we are human, we can have fun, enjoy our work, have disappointments and failures, as well as success.

 

Do you think being more open can help dispel some of the misconceptions people may have about companies like yours?

There is often a great deal of money changing hands in the industry, so the public thinks the industry and all entities providing goods and services to it are highly profitable. More often than not, that is far from the truth. I cannot imagine any independent oil and gas operator in Louisiana with conventional production that needs a tax write-off. So yes, it’s important for people to see the human side of the business.

 

Your family has long been involved in different industry organizations — you and your father have both served on the boards of groups like IADC and LMOGA, and you’re active in LOGA, LAGCOE, API and others. Why do you think it’s important for businesses to be involved in professional and trade associations like these?

These organizations were created for the purpose of furthering the interests of this industry, and the work they do helps all of us. They keep us informed on critical issues, support industry education and host valuable events. I can't think of a better value for the money.

 

As you look toward the future of Justiss Oil Company and the industry overall, what do you see?

While we try to be optimists, we must also be realists. The onshore American market is very mature. This is particularly true of the Gulf Coast Basin. Most large fields were found long ago. Every conventional well pursuing ever smaller targets is either productive, or condemns a certain area around that wellbore as non-commercial.

Like Yogi Berra said: "it's tough to make predictions, especially about the future." Conventional reservoirs will continue to be the target of most independent E&P firms, including Justiss Oil. These will be smaller targets, drilled at deeper depths at more cost. We have to utilize new technology-based techniques to assist in decreasing our risk in finding these conventional reserves.

 

What impact has technology had on the work you do? How do you think it will shape the future of the industry?

When I first came to work at the company in 1990, we would have to drive to Monroe or Shreveport to review state records on wells. Everything was on paper, and we had to pull cards, make photocopies, and hope we didn't forget anything before we made the hour-and-a-half drive back to Jena. Fortunately, today we have SONRIS — the best data system for public access to oil and gas records that any state has.

There are some forward-thinking "futurists" that believe in the not-too-distant future, robotics and automation will take over most of the jobs now being performed by unskilled workers. It will be a little longer before this happens with drilling and well servicing rigs, but change will come. The way we do things today will not be the way they are done tomorrow, and they will be done with or without us. We can choose to dread these changes, or embrace them to help further our companies. Family-owned companies such as ours don't have budgets to support large R&D departments, so we must seek to apply what has been developed by larger entities both inside and outside of our industry.

 

Would you recommend oil and gas as a career to a future graduate? Which career tracks (geology, business, operations management, tech) do you think have the best outlook?

I may favor geology because I am educated as a geologist myself, but it has some applications outside of the industry that some careers may not. Groundwater and environmental firms employ geologists. Teaching is another option. Maximizing your options for the skill sets your education provides is of value, especially in an industry subject to cyclical downturns. Technical/computer skills will be in increasing demand across all careers throughout the industry.