Legislature, industry invest $115 million in UW engineering

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Legislature, industry invest $115 million in UW engineering

By Gregory Nickerson, WyoFile.com
Originally published on January 22, 2013

A group of alumni from the University of Wyoming College of Engineering is working to secure $115 million in state and industry money to boost their alma mater back to a position of national prominence.

Legislature 2013 series

Click here to read more from this series.

The effort became a major funding priority for legislative leaders, Gov. Matt Mead, the university and industry in the past year, but is only now attracting attention from the public and the media.

Last week a group of oil and gas companies announced $10.9 million in donations to fund energy research at the University of Wyoming. Gov. Mead revealed the news at a press conference held in the Capitol rotunda Friday.

Some members of the audience may have missed the fact that the industry gifts are part of a much larger $115 million push to remake the University of Wyoming College of Engineering into a “Tier 1” research institution.

The effort stands as the largest single project undertaken in university history. It responds to a widespread acknowledgement that the College of Engineering has fallen from the competitive position it once held in the 1970s and 1980s.

The project will completely transform the College of Engineering, which has outgrown its cramped facilities due to climbing enrollment.

Dr. Robert Ettema, the Dean of the College of Engineering

Dr. Robert Ettema, the Dean of the College of Engineering. (Courtesy of the University of Wyoming)

The $115 million investment is meant to double the size of the College of Engineering, which currently has about 1,420 undergraduates and 230 graduate students.

Dr. Robert Ettema, the Dean of the College of Engineering, says the school has grown between 4 percent and 5 percent over the last seven years, which has led to overcrowding. “We are constrained physically. We are overwhelmed with the number of students we have, the lack of space and the lack of faculty members,” Ettema said.

When the project is complete, Ettema anticipates the college will have a target enrollment of 2,000 to 2,500 undergrads and 500 grad students, and corresponding doubling of faculty.

Dr. Ettema says the college will focus on attracting excellent faculty members while also recruiting high-caliber students.

Currently the engineering project has about $22 million available from corporate donations and a state match, plus a $30 million legislative appropriation from 2012.

Last year’s appropriation of $30 million came from capital gains — money that’s not forecasted by the Treasurer’s Office and the Consensus Revenue Estimating Group (CREG), even though some capital gains are almost always expected.

It’s become a point of contention between Gov. Mead’s office and the legislature. Gov. Mead would prefer to budget the extra capital gains revenues, but lawmakers enjoy having a pretty reliable cushion of extra cash to work with after the budget process.

Last year several leaders in the legislature anticipated the capital gains, including Sen. Phil Nicholas (R-Laramie). They wrote in an appropriation for the College of Engineering project that would kick in if gains materialized after the legislative session. This diverted the capital gains income from flowing into a savings account called the Spending Policy Reserve Account.

When the predicted capital gains showed up in late spring of 2012, the College of Engineering had the first $30 million toward its project.

While Gov. Mead embraced the outcome, he didn’t embrace the method.

“Last session I built my budget based on x amount of dollars, and the legislature looked at the same dollars and then they added $30 million to it that I didn’t even consider, and that was out of capital gains income,” said Gov. Mead. “At the very least we should say we’re all playing with the exact number of cards here, because its not fair we can’t even agree how much money we had to deal with.”

Despite the disagreement about the capital gains issue, Gov. Mead called creating a Tier 1 academic research institution a “top priority for my administration.”

The governor actively supported the project by traveling with UW Foundation President Ben Blalock to meet with industry donors. He also called for the organization of the WYGEESIT task force (explanation of the acronym to follow) which included high-powered oil and gas executives with ties to University of Wyoming engineering.

The task force also included former Gov. Freudenthal, Sen. Nicholas, Rep. Tom Lockhart (R-Casper), UW president Tom Buchanan, and UW Board of Trustees President Dave Bostrom.

Nicholas has four children who attended the College of Engineering, while Lockhart and Bostrom are UW engineering graduates.

“I was (a student of) engineering back in the same time period when the rankings were higher. But we’re going to get that back,” Bostrom said.

Last November Gov. Mead recommended that the legislature fund the rest of the College of Engineering project with an additional $30 million appropriation from the General Fund, plus $40 million in Abandoned Mine Land Funds — money that was previously appropriated to UW’s coal gasification project with GE, which shelved the project indefinitely.

Now that the legislature is in session, lawmakers will likely take a different course.

Sen. Eli Bebout (R-Riverton), also an UW engineering grad, is co-chair of the Joint Appropriations Committee. He says the committee has already discussed funding for the College of Engineering. The committee is behind the project, and committed to finding money to get the project to about $105 million, which will add to the $10.9 million in corporate support to reach the total project budget of about $115 million.

Right now Sen. Bebout says the plan is for the money to come from the General Fund, but the specific plan will be better defined this week when the budget bill comes out and funding sources are identified.

Growing the College of Engineering may enable UW to attract more research dollars, but it will also increase the ongoing operational costs of the school. Those increases come at a time when the state legislature is looking at cutting about $14.7 million from the university’s 2014 budget.

When the WYGEESIT task force presented its report to the Joint Minerals Committee of the legislature last week, some lawmakers worried about how they could justify spending to their constituents.

Members of the WYGEESIT task force pose for a picture in the Wyoming Capitol after announcing $10.9 million in corporate donations for energy research at the University of Wyoming. Front Row: Dave Bostrom, President UW board of Trustees; Dick Agee of Wapiti Energy; Greg Hill of Hess Corp.; Gov. Matt Mead; and Tom Botts of Shell. Back Row: Eric Marsh of Encana; Tom Buchanan, UW President; Chad Deaton of Baker Hughes. Not pictured: Rep. Tom Lockhart (R-Casper), Sen. Phil Nicholas (R-Laramie), and former Gov. Dave Freudenthal

Members of the WYGEESIT task force pose for a picture in the Wyoming Capitol after announcing $10.9 million in corporate donations for energy research at the University of Wyoming. Front Row: Dave Bostrom, President UW board of Trustees; Dick Agee of Wapiti Energy; Greg Hill of Hess Corp.; Gov. Matt Mead; and Tom Botts of Shell. Back Row: Eric Marsh of Encana; Tom Buchanan, UW President; Chad Deaton of Baker Hughes. Not pictured: Rep. Tom Lockhart (R-Casper), Sen. Phil Nicholas (R-Laramie), and former Gov. Dave Freudenthal. (Courtesy University of Wyoming Foundation — click to view)

“I can’t convince people we need to pay another six dollars a month for fuel tax,” said Rep. Mike Greear (R-Worland). “We need to be able to defend this to people of the state.”

For those involved in the project, the rationale for the project focuses on economics.

“No place on the planet develops economically without a vibrant college of engineering and computer science programs,” said Ettema. “It’s a real resource without which the state’s economy will not grow as well as it should.”

Ettema also noted that an updated college of engineering would provide, “great career paths for young people in Wyoming.”

An example of such a career path can be found in Greg Hill, the executive of Hess Corp. who announced the $4.4 million donation for energy research at Friday’s press conference.

Hill grew up in Cody, Worland and Casper, and competed as a rodeo cowboy before becoming a 1983 UW graduate in mechanical engineering. Hill said he attended UW at a time when the College of Engineering was one of the top programs in the nation. His professors wrote mechanical engineering textbooks used in universities around the country.

“You had this amazing collection of faculty at the University of Wyoming, and they gave an outstanding education,” Hill said.

After graduating from UW, Hill moved to California and started a 20-year career with Shell. He then left Shell to become president of exploration and production at Hess Corp. Over the course of his career he has lived or worked in 43 countries, and currently works in London, New York, and Kuala Lampur, Malaysia. But he calls Wilson, Wyoming home.

Last week Hess Corp. announced that Hill’s division of the company will spend $6.7 billion for unconventional oil and gas exploration and production in 2013.

“As I look back on my life the two things that have caused me to be successful are the work ethic and values that go with the state of Wyoming, (and) the education I got there,” Hill said. “It starts with that outstanding education because that is the door opener.”

Task force recommendations

The name of the Wyoming Governors Energy, Engineering, STEM Integration Task Force doesn’t roll off the tongue, and neither does its acronym, WYGEESIT. But at core the task force has the logical mission to integrate research efforts currently housed in different university programs.

These silos include the College of Engineering and Applied Sciences, the School of Energy Resources (founded in 2006), and the Enzi Science Technology Engineering and Mathematics (STEM) building.

The advisory board of the College of Engineering previously identified the need for integration among the various energy research programs at UW, said former Gov. Jim Geringer, who is a member of the board.

When construction ends, the College of Engineering will have a completely remodeled engineering building that stands in close proximity to labs at the Energy Innovation Center (recently completed) and the Enzi STEM building that will contain undergraduate teaching labs.

In addition, the project will include another building — Energy Engineering Research Facility (EERF) — in an open area on the northeast sector of campus near the physical plant. A main feature of this facility are “high bay” research spaces for work by graduate students and faculty. Construction could begin as early as 2014.

The firm chosen to design the EERF and the College of Engineering will take care of architecture and engineering. Administrators have not yet announced the name of the firm, but will likely do so in the near future.

Members of the task force say they aim for UW’s College of Engineering to rival other “Tier 1” programs like MIT, Texas A&M, and Rice. Sen. Chris Rothfuss (D-Laramie), who teaches engineering courses at UW, first used the term “Tier 1” to describe the goal of the project.

The recent corporate gifts all come from oil and gas companies, with $500,000 each coming from Shell and Baker Hughes, plus $1 million from Marathon, $2 million from Ultra Petroleum, and $4.4 million from Hess Corp.

All of those companies, except for Ultra, had representation on the WYGEESIT that task force. Task force members Chad Deaton, Greg Hill, Dick Agee, and Eric Marsh also sit on the board of the UW Foundation.

Blalock, president of the UW Foundation, said another company has pledged $2.5 million more to help reach the $10.9 million total. To date EnCana and Wapiti Energy are the two companies represented on the WYGEESIT task force that haven’t announced a donation.

The WYGEESIT report calls for the College of Engineering to integrate programs with the School of Energy Resources and the Enzi STEM Facility. It also identifies possible niches for researchers and educators in the college. For the full report click here

The WYGEESIT report calls for the College of Engineering to integrate programs with the School of Energy Resources and the Enzi STEM Facility. It also identifies possible niches for researchers and educators in the college. For the full report click here. (Courtesy University of Wyoming — click to view)

The corporate donations will be matched by an equal amount of state funds from the University of Wyoming Academic Facilities Challenge Fund, bringing nearly $22 million toward the $115 million project.

The gifts come after a decade in which the state saw about $300 million invested in the university’s energy research, and $1 billion in the campus as a whole. (To read more about UW’s growth, click here.)

The donations will benefit engineering students and faculty, but it will also produce valuable knowledge that companies can use to boost their profits — and presumably help boost state revenue in the form of energy development.

The $4.4 million donation from Hess Corp. will support the work of Dr. Mohammad Piri, whose research into the flow of oil and gas through rock has captured the interest of industry and government officials.

Dr. Piri received his education in Tehran and London, and held a post-doc at Princeton before coming to Wyoming. His lab uses a CT scanner and x-rays to analyze core samples of rocks and visualize the pore space within. He uses the data to measure the flow of liquids and gasses through rocks, which has valuable applications for energy companies.

Since Piri’s lab — officially named the “EnCana Research Lab” — opened in 2008 it has received a steady flow of visitors from scientific colleagues and many industry representatives from companies like Total and Saudi Aramco. Wyoming political figures like Al Simpson and former Gov. Dave Freudenthal have made the trip to see the lab.

Task force member Greg Hill of Hess Corp. hopes research like that conducted by Piri in the EnCana Research Lab will allow companies to get at more of the fossil fuels locked away in unconventional formations.

According to Hill, the world has burned about 1 trillion barrels of oil from the start of the 1860s industrial revolution until now. Global reserves of unconventional oil and gas contain another 1 trillion barrels, but current production methods will only extract about 10 percent of that. Hill thinks Dr. Piri’s research will yield better results that will enable companies to meet demand as the global population surges to over 9 billion by 2050.

The research into unconventional reservoirs represents just one of the six areas the WYGEESIT final report identified as potential niches for the College of Engineering. These niches represented areas of current focus for the university that also have relevance for industry, Wyoming, and the nation. According to the 25-page report, the potential areas of focus could include:

  • Energy in general but reservoir characterization in particular
  • Computational science
  • Atmospheric science
  • Water Resources Engineering
  • Biomedical and biological engineering
  • Advanced conversion technologies for energy resources, particularly coal and gas

“Its very important that this isn’t going to be just oil and gas,” said task force member Chad Deaton, who is executive chairman of Baker Hughes. “When you get one (niche) down then you move over to the next one and tackle that one.”

The niches will allow the College of Engineering to compete in specific areas. For example, rather than trying to excel at all of computer engineering, UW will look specifically at computational science, which will be supported by Wyoming’s recent investment in the National Center for Atmospheric Research supercomputer located near Cheyenne.

Similarly, Wyoming will focus on aspects of biomedical engineering that fit with current strengths. “There are a lot of synergies with petroleum engineering (and biological engineering) in terms of small-scale flows. Measuring flows of fluid in tight rock are the same with flows in tissue,” said Ettema.

The task force noted that the identified niches were only recommendations. The College of Engineering, the university, and legislators will identify the final priority areas.

The full WYGEESIT Report is available as a pdf download here.

Gregory Nickerson is the government and policy reporter for WyoFile. He is based in Cheyenne during the 2013 legislative session. Contact him at greg@wyofile.com.

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