U.S. Government officials announce plans to build the world’s first nuclear power plant at an estimated cost of $80,000,000. The Federal Power Commission announces that natural gas became a $2,000,000,000 industry in 1952. The eldest son of the last absolute monarch in the world, Crown Prince Emir Saud, ascends to the throne of Saudi Arabia upon the death of his father, King Ibn Saud. Drilling commences on what may be the most exclusive lease location in the U.S., as the Universal Consolidated Oil Co. spuds a well using its "completely soundproofed" drilling rig on the studio lot of Twentieth Century-Fox on the outskirts of Beverly Hills, California.
East Texas crude oil - $2.90 per bbl; U.S. – 2,799 rigs running
A Swiss banking report states that within 10 years the Mexican peso will be on a par with the U.S. dollar, reportedly due to "the success of the Mexican petroleum industry." Shipments to the U.S. begin for the first Chinese crude oil purchased by a U.S. firm. The purchaser is Coastal States Gas. Previous Chinese deals for oil with other countries have only been on a government-to-government basis. Alberta Energy announces exploration farmouts on 4 blocks in the Primrose Lake Air Weapons Range of eastern Alberta. (Any wells that prove to be dusters will be used for target practice by the Canadian Air Force.) U.S. active rig count sets a 21-year record at 2,385, while Canadian rotaries set an
all-time record at 335.
U.S. – 2,385 rigs running
Hazel is in trouble again. Energy Secretary Hazel O’Leary, in an Associated Press interview, is quoted as saying "the industry’s smaller domestic players may be a dying breed too feeble to salvage in an era when Big Oil is setting its sights overseas." UPRC announces plans to test a trilateral horizontal well in Brazos County, Texas, in which each lateral penetrates a different formation (Austin Chalk, Buda and Georgetown). Libya reportedly moves $6.5 billion in cash into Third World banks in order to escape U.N. sanctions stemming from the Lockerbie, Scotland airliner incident. Meanwhile, Iraq continues to lobby for removal of its U.N. sanctions, citing elimination (i.e., hiding) of its weapons of mass destruction. The World Bank announces the largest loan in its history, a $610 million oil rehabilitation loan to Russia. The U.S. Senate approves the North American Free Trade Agreement (NAFTA), thus phasing out all tariffs between the U.S., Canada and Mexico.
WTI - $17.31 per bbl; Natural Gas - $2.41 per MMBTU; U.S. – 870 rigs running
Saddam is at it again. He again bans U.N. weapons inspectors, reportedly until such time as U.N. sanctions are lifted. The industry downturn prompts more consolidations. Parker Drilling and Superior Energy Services agree to merge; Nabors Industries makes another run at Pool Energy Services; and Ocean Energy and Seagull Energy report plans to merge. Even Japan follows suit as Mitsubishi Oil announces plans to merge with Nippon Oil. Phillips executives, on the other hand, claim that they will fight any takeover initiatives. (Not enough bullets in their gun!) Low crude oil prices push the average, U.S. retail regular gasoline price below $1/gal for the first time since early 1994.
WTI - $14.11 per bbl; Natural Gas - $2.47 per MMBTU; U.S. – 696 rigs running
The Rest of the Yarn
Born on a farm in Tennessee, he and his family, shortly after his birth, moved to near Victoria, and Texas became his adopted state. He attended the University of Texas with plans to become a journalist, but a geology course changed his fate. He went on to obtain a B.S. degree in geology.
He began his career as a staff geologist with Humble Oil & Refining (an affiliate of the Standard Oil Company). At 39, he became the youngest head of an oil company in the United States, when he was named president of Carter Oil Company, another division of Standard Oil, in Tulsa. In 1943, he moved to New York as chief coordinator of worldwide production for Standard Oil.
He continued to gain a solid reputation for exceptional leadership with Standard Oil and ultimately was recruited by Standard’s rival, Continental Oil Company. He led this company into innovative fields of foreign exploration, natural gas processing, and commercial marketing of numerous petroleum-derived products. Despite being told that he was crazy for doing it, he once bought a coal company that became their most lucrative investment. From the time that he first entered the boardroom in 1947 until he retired as CEO in 1967, he helped establish new divisions of R&D, market research, and strategic planning. He possessed an extraordinary ability to effectively delegate authority and to inspire others to see success where others saw failure. He helped set the company apart from its competition by taking chances and ultimately helped advance the oil industry in unprecedented ways.
Known affectionately as "Mr. Mc," both within and without the company, he distinguished himself in numerous civic areas. He served as chairman of the Baylor College of Medicine and was the first chairman of the People-to People Health Foundation that sponsored the floating hospital ship Hope, which provides free healthcare all over the world. He was instrumental in the development of Project Orbis, which turned a donated DC-8 plane into the "first flying eye hospital." Like the hospital ship Hope, the eye hospital plane Orbis brings eye care to countries in need.
A shrewd business leader and a stalwart supporter of charitable causes, he once said, "The self interest in business is best served when the public interest is paramount." Leonard "Mr. Mc" McCollum died in 1993 at age 91, but his contributions to charity and to the growth and development of the multi-national exploration and production company, Conoco, will long be remembered. And now you know…The Rest of the Yarn.
Readers are encouraged to submit brief, ostensibly true stories about notable personalities from our industry’s storied past. Submissions should be e-mailed email@example.com.
The once hot Bakken play has again surfaced, this time in Eastern Montana where two independents in the Dallas area are currently drilling horizontal wells to exploit this reservoir. Because of the outline of one of these fields in eastern Montana, many of the Bakken horizontal wells in the field have been named after the characters in a television cartoon series dating back to the late ‘50’s and early ‘60’s. Name the cartoon series.
If you would like to participate in this month’s quiz, e-mail your answer firstname.lastname@example.org by noon, November 15. The winner, who will be chosen semi-randomly from all correct answers, will receive a $50 gift certificate to a nice restaurant.
Answer to October’s Quiz
In 1953 Houston was the headquarters city for the largest number of American drilling contractors. The city that ranked second was Wichita Falls.
Answer to September’s Quiz
Futurists in the early 1950’s were predicting that the advent of television would enhance furniture sales and decrease the need for crude oil. They described how furniture purchases had declined considerably since the 1920’s due at least in part to the popularity of the automobile and the populace’s preference to ride around in their automobiles rather than stay at home and listen to the radio. By this same logic, the popularity of television had drawn people back home to watch it rather than ride around in their automobiles. This meant that they would likely wear out furniture more quickly, thus requiring new furniture purchases. Conversely with less usage of their automobiles, would come reduced needs for refined crude oil.
Congratulations to September’s winner (numerous correct answers this month) – T.E. (Thal) McGinness with BP.