January 1957

The new jet-perforating technology is unveiled by Jet Research Center. The ellipsoid-shaped liner and steel barrier in the explosive charge promise substantially larger holes with a slight increase in penetration. An industry committee reports that the domestic oil industry currently produces 7 to 8 million barrels of oil per day, but unless pipeline expansions occur soon, the industry would be limited to 9 million barrels of oil per day that could be both produced and subsequently transported. A badly-split Texas Railroad Commission decrees a 16-day oil allowable for the month of January. This represents a victory by the independents over the majors who wanted to expand the allowable to 17-18 producing days. (“Allowable”...Now there’s an extinct term in our industry.)

East Texas crude oil—$3.25/bbl

U.S. active rig count—2,330

January 1981

After Libya announces a crude-oil ceiling price of $41 per bbl for 1981, fellow African producer and normal Libyan consort Nigeria announces a ceiling price of $40 per bbl. Next up is fellow African producer Algeria. (Do I hear $39 per bbl?) President-elect Reagan completes a very cordial visit with Mexican President Portillo in an attempt to improve relations between the two countries with regard to increased oil imports to the United States and ceding a chunk of the Gulf of Mexico to Mexico. (Sam Houston is probably rolling over in his grave.) Congress Watch, a Ralph Nader affiliated group, vows to continue to push for a government-owned energy company. (Don’t hold your breath!) 

U.S. active rig count—3,344

January 1996

With tetraethyl lead banned from all U.S. gasoline effective January 1, a wave of alternative automobile engines hits the media. Everything from propanefueled to hydrogen-fueled automobiles is featured. The latest oil spill in Russia may prove to be a big one. Workers struggle to contain oil leaking into the icebound Belaya River from a pipeline carrying oil from Siberia to Bashkortostan. (Now, those are a couple of garden spots!) The U.S. active rig count continues to plummet, reaching near-record post-WWII lows. In an effort to revive India’s Dabhol power project which is fed by liquefied natural gas, an Enron Corp. group proposes to trim its project interest and recast phase two of the project as a separate, independently funded venture. (Beware of strangers bearing gifts.)

Light sweet crude oil—$18.61/bbl
Natural gas—$2.17/MMBTU
U.S. active rig count—716

The Rest of the Yarn

Continuing with our look back at the colorful history of the East Texas field on this its 75th anniversary year, this month we begin by examining some of the approaches taken by operators to deal with the restrictions placed on them by state and federal governments. Though martial law quickly squelched all open resistance to proration, the East Texas field continued to produce huge volumes of “hot” oil through the mid ‘30s. Then on May 18, 1933, a law was passed making it a felony to violate state proration laws. It appeared to have had little effect. The allowable that month was reduced to 550,000 bbl per day, but actual production was about 1 million bbl per day.