By Eric Peterson
In the Carriage House at the Governor’s Mansion in Denver, a select group of sponsoring judges — largely from big oil and gas companies — gather every year listen to presentations from cleantech startups. The judges ask the presenters how their solutions can make their industry cleaner and greener — and even boost productivity and profitability.
It’s an unexpected pairing, but an effective one. The cleantech solutions are often exactly what big oil and gas companies need.
CoResource Solutions presented at the 2016 Oil & Gas Cleantech Oil Challenge. Founder and CEO Chris Tesarski says he was afraid his company would get pigeonholed as “just another water company” with pie-in-the sky hopes of commercialization. “I’ll be honest, I initially wasn’t into it,” he says.
But Tesarski says it proved a turning point for CoResource Solutions: “It helped launch a new mindset for us: Are we going to be an oil company that treats water or a water company?”
The challenge led him to take the latter path, and the company is now working on a mix of industrial, oilfield, and municipal projects. “The company literally pivoted at that point because of CCIA,” says Tesarski.
Tesarski also relocated the company’s headquarters from West Texas to metro Denver in 2017, and CoResource Solutions has since grown the operation from four to 12 employees. “In terms of opportunity and ability to generate business, it’s grown exponentially [since the move],” he adds.
The driving factor? The oil and gas industry in Colorado is more open to a company like CoResource Solutions, he says. “We were in the wrong place to spread the message we had: ‘We’re going to do things differently,'” explains Tesarski. “That message does not resonate in Texas.”
This is precisely the kind of outcome CCIA leaders had in mind when they launched the Oil & Gas Cleantech Challenge. The idea arose in 2014, when former CCIA Executive Director Christine Shapard heard from people in the traditional oil industry looking for cleaner and more sustainable solutions. Meanwhile, some CCIA members were angling to supply these same companies with novel technologies.
“They came to us and said, ‘How can we get in front of traditional oil and gas companies?'” says Mary Austin, CCIA’s partnerships director. Shapard and Austin worked to bring some of the biggest names in Colorado’s oil and gas industry into the fold.
The process starts with a discussion with the sponsoring companies about their specific needs. Explains Austin: “The reason the oil and gas companies took a chance on us is we said, ‘We don’t know your industry, you do. Tell us what you’re looking for.'”
That conversation dovetails directly into the call for entries for the challenge. From about 30 applicants, the oil and gas companies and other sponsors select 10 to 12 finalists based on their ability to fill industry needs. Methane detection has been a big emphasis since 2015; water treatment is another focus area. The winner takes home $5,000, but most of them see the networking and connections as the real rewards of the challenge.
The idea initially generated controversy. Why is the state’s leading cleantech organization partnering with Big Oil? CCIA leadership saw the event as a means of turning the oil and gas battleship towards cleaner and greener products and processes.
“There was enormous pushback,” says Ned Harvey, managing director of the industrial program at Rocky Mountain Institute and CCIA board member, of the first challenge. “We’ve moved past that pretty well. The big ‘aha!’ was realizing they look at this differently.”
Scalability is critical. So is pragmatism. “All these companies are challenged by environmental issues,” Harvey says. “It’s all wrapped up in trying to do innovation work and entrepreneurial stimulation in these very big industries,” he says. “These are massive companies with very strict procurement rules. It’s very hard for a startup or small company to sell to these big companies. The contracts are brutal.”
The benefits go both ways. “We actually thought what they were proposing was a great way to find novel technologies that weren’t necessarily geared towards the oil and gas industry, but could potentially be applied,” says Karl Fennessey, manager for corporate public policy for ConocoPhillips.
“Over the years, we have seen a lot of value in the technologies, the format, and the various partners that CCIA has brought into it,” he adds. “We’ve had follow-up communications with at least half the presenting companies, and a handful of discussions have advanced to the possible application of their technology within ConocoPhillips.”
One such company is Montreal-based GHGSat, which won the Oil & Gas Cleantech Challenge in 2016. The company uses a small satellite to detect greenhouse gas emissions all over the planet.
GHGSat CEO Stephane Germain says the challenge gave the company an entry point for the U.S. market. “Expanding to the U.S. was new to us and hugely important,” he says. “It all starts somewhere, and for us it started with the challenge.”
Kyle Klam, founder and CEO of the 2018 Oil & Gas Cleantech Challenge winner, Calgary-based Modern Wellbore Solutions, worked in the field and saw the need for a multilateral fracking system.
Echoing Germain, Klam says the challenge was a valuable experience, and the $5,000 prize was just a small part of it. “We won some money, but we definitely didn’t go there for the money. We went to meet people.”
Launched in 2017, the Mining Cleantech Challenge stemmed from a request from Resource Capital Funds in Denver. “They came to us and said, ‘Will you do this for the mining industry?'” says Austin. With sponsors like Newmont, Barrick, and McEwen Mining, the event follows the same template as its oil and gas counterpart.
The big difference? “It’s taken the program international,” says CCIA’s Austin. “We received applications from South Africa, the U.K., and the Netherlands, as well as Canada. It really ups the game for outreach.”
She adds, “I’ve been really happy to see how open these large companies in extractive industries are to new technologies. We’re fortunate that we found the right people in organizations like Noble Energy, ConocoPhillips, Encana, Altira, and BP. They’re making a difference.”
CCIA is now taking applications from innovative cleantech companies and inquiries from sponsors for the third annual Mining Cleantech Challenge.
Eric Peterson is a freelance writer and editor in Denver. Reach him at email@example.com