It’s 1956—This country’s oil industry is approaching 60,000 new wells yearly; 36% of them are dry; it gathers over 7 million barrels of oil daily from more than 525,000 wells and delivers it to more than 300 widely scattered refineries; its principal product, automotive motor fuel, is made available at the refinery gate for a delivered price of $0.02 or less per pound. No other large industrial operation in the country can match the low price of its finished product. Our present-day border security folks could use the skills of the pipeline aerial patrol pilots of the 1950s. These WWII veteran flyboys could fly hedgehoppers at slow speeds and low altitudes and spot pipeline oil leaks (oil sheen on water or oil-stained soil) or gas leaks (gas bubbles in water or discolored vegetation on land) with remarkable precision. One might ponder whether all our present-day technological visualization aids have degraded our God-given powers of observation to the point that few of us could successfully perform such a manual observation task in this day and time (not to mention that we are all becoming severely near-sighted from staring at computer screens all day and TV sets all night).
East Texas crude oil—$2.90/bbl
U.S. active rig count—2,513
U.S. active rig count—2,513
September 1981The U.S. drilling rig count breaks the all-time daily record with 4,194 active rigs, and the monthly average of more than 4,000 active rigs also breaks the all-time monthly average record. BP presents the U.K. with what is being called the “world’s biggest tax payment.” Messengers delivered a check and certificates worth $1.8 billion to the taxman at Britain’s Inland Revenue department. BP’s North Sea tax bill for the 12 months ended June 1981 was nearly $3.86 billion. Compensation packages for major oil company exploration vice presidents and top executive positions at new or expanding independent E&P firms reach $150,000– $300,000/year, plus overrides on reserves improvements, merit bonuses, stock options, and trust arrangements. (Is it any wonder that we have had all of these issues with overestimated reserves?) Congressman John Dingell(berry), chairman of the House Energy and Commerce Committee, declares openly that gas decontrol legislation would be passed “over my dead body.” (At our office, that claim would qualify for the “Wall of Shame.”)
U.S. active rig count—4,194
September 1996A faulty power station circuit breaker is blamed for a 12- to 15-hr power outage of Malaysia’s national transmission grid. Now with two major blackouts in 4 years, Malaysia’s electric utility chairman is sacked and a reversion from gas-fired power to coal and hydroelectric is being considered. Saddam Hussein’s decision to attack Kurdish strongholds in northern Iraq not only buoys world oil prices but also firmly blocks the U.N.-brokered deal to allow Iraq to begin exporting oil to world markets for the first time since 1990. U.N. Secretary General Boutros (x2 or is it x3?) Ghali decides to delay the implementation of the oil export deal in light of the deteriorating situation in northern Iraq. With the world’s second largest gas reserves after Russia, Iran is actively courted by gas importing countries Knowledge Systems 11 such as Turkey, Pakistan, and France. The U.S. State Department claims that petroleum import agreements with Iran “send the wrong signals to Tehran.”
Light sweet crude oil—$23.48/bbl
U.S. active rig count—790
U.S. active rig count—790
The Rest of the YarnBorn in Marksville, Louisiana, he graduated from the U.S. Naval Academy in 1938. After serving in World War II, he became a maintenance engineer for prominent Fort Worth wildcatter Sid Richardson. In 1948 he joined Kerr-McGee Corp. as the company ventured into offshore drilling. He designed a drilling platform supported by columns on top of a barge. Workers could flood the barge, resting it on the sea floor, and drill a well. Then, the barge could be resurfaced and floated out to a new drill site.
When Kerr-McGee rejected his new offshore drilling concept, he resigned and began shopping around his invention. He found investors interested in pursuing his novel idea. In 1954, Shell Oil Co. contracted the rig, named “Mr. Charlie,” to drill in the shallow waters near the mouth of the Mississippi River. Later, he developed a semisubmersible rig that could drill while being held in place by anchors rather than resting on the sea floor. This opened up drilling opportunities in deeper waters.
During his career, he launched two public companies, namely, Ocean Drilling & Exploration Co., which built several variations of his rig designs, and Tidewater Inc., which focused on support vessels for the oil industry and eventually became the world’s largest offshore vessel operator.
He retired in 1977 at age 61. In April 1985, he was selected by Fortune magazine for induction into the National Business Hall of Fame, alongside such business legends as J.P. Morgan, John D. Rockefeller, and Walt Disney. On the night of his induction, he was quite modest about his achievements. “While it appears that you have a good record of selecting laureates over the years, I hope it is good enough to survive one big blooper,” he said.
He was an out-of-the-box thinker who figured that offshore drilling would be a whole lot easier if the rigs could move from place to place rather than being cemented to the sea floor. With that simple, yet revolutionary idea, the oil and gas industry plunged into the offshore market with a vengeance. He was “Doc” Laborde. 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 to firstname.lastname@example.org.
History QuizStarting with two postulates, 1) Knowledge is power and 2) Time is money, prove Dilbert’s rarelychallenged “Salary Theorem,” which paraphrased states that engineers and scientists can never earn as much as business executives and sales people.
If you would like to participate in this month’s quiz, e-mail your answer to email@example.com by noon, September 15. The winner, who will be chosen randomly from all correct answers, will receive a gift certificate to a nice restaurant.