Interesting comments by Carl E. Reistle, the president of Humble Oil, in a recent interview in answer to the question, “What will qualify Humble engineers for advancement in the future?”… 1) moral integrity, 2) an inquisitive mind, 3) the ability to communicate with others, 4) a desire to accomplish things without asking, “What’s in it for me?” 5) enjoying his work, and 6) good judgment…Not a bad list! $$ A 6-months-long fight by Pan American Petroleum to control a subsurface blowout in Terrebonne Bay, South Louisiana ends in success by drilling a directional relief well and pumping bay water, acid, and mud into the producing sands. $$ The federal government decides to revive its previous barter plan in which surplus U.S. agricultural products would be swapped for oil products abroad for use by the military, with the intended purpose being to reduce the outflow of U.S. gold reserves.
U.S. active rig count – 1,420
What are some of the E&P hotspots in early 1988…the deepwater GOM and the Arkoma basin onshore. The big players include, ironically, Texaco, Amoco and Standard Oil offshore, and ARCO onshore. $$ It is reported that as of the First Quarter 1988, an estimated 110-150 important horizontal wells have been drilled in the world. What operators were on the right track in the U.S., again ironically…Meridian in the Bakken and Amoco in the Mississippi Lime. Great companies one and all, but where are they today? $$ Seven major U.S. companies are currently involved in exploring joint ventures with the Soviet Union in energy, chemicals, and other areas within its borders. $$ Iran continues to attack U.S. ships in the Persian Gulf, thus leading to disrupted tanker movement in and out of the Gulf.
WTI crude oil - $16.91/bbl; U.S. active rig count – 916
Dominion E&P and partner Pioneer Natural Resources prepare to receive what is reported to be the world’s deepest dry-tree spar hull for their Devil’s Tower field in 5,600 ft water depths in the GOM. $$ Meanwhile, Anadarko awards a six-well contract for permanent downhole optical pressure and temperature, and distributed temperature-sensing systems for their Marco Polo deepwater development in the GOM. $$ The pending formalization of the joint venture firm of TNK-BP uniting two Russian partners with BP could reportedly be the catalyst required to spur the formal investment in Russia’s oil and gas sector that has been missing in the post-Soviet era. $$ The U.S. natural gas resource base, including proved reserves, was reported to be 1,311 tcf at the end of 2002, and if all of it is developed, it would amount to a 65 yr supply at current production levels (Just wait and see what shale gas does to these numbers.).
Light sweet crude oil - $27.40/bbl; Natural gas - $5.25/MMbtu; U.S. active rig count – 979
The Rest of the Yarn
This month we continue our extended look at the life and times of oil magnate John D. Rockefeller.
The petroleum business in the 1860’s and 70’s was an unruly jungle of producers, refiners, manufacturers, brokers, and shippers. The competition was ruthless, with most everyone angling for a fast kill. Rockefeller hated this chaos. He believed business needed order and structure to survive for the long haul. Order, in his view, meant eliminating messy competition and ensuring that the industry ran smoothly by acquiring monopoly control.
He assured himself that such a move would benefit everyone by strengthening the oil industry and providing “a missionary service to the whole world,” he recalled some years later. He undoubtedly believed this, but his love of money and power also drove his plan—a fact that he never liked to admit to himself.
He would impose order through the Standard Oil Company of Ohio, formally organized in 1870, where he served as president and chief stockholder. By 1872, Standard Oil had bought out most rival refineries in Cleveland and consolidated them. Some refinery owners weren’t inclined to sell at first, but Rockefeller and his team made it clear they would drive them out of business if they didn’t cooperate.
As it grew, Standard Oil used more and more predatory tactics, some illegal, some unscrupulous, some merely aggressive. The company invested a small fortune in political bribery, commonplace in the “Gilded Age.” It frequently sold products at cost for as long as it took to demolish the competition. It forced retailers to carry its kerosene exclusively. It paid a network of spies to keep tabs on the industry, and it amassed a formidable arsenal of obstructive techniques. Rockefeller eased his conscience by assuring himself that what was good for Standard Oil was good for America.
Next month, Standard Oil becomes the greatest corporate empire the world had ever known, and Rockefeller moves to the “Big Apple.”
When motor cars started becoming more common on English roads in the early 1900’s, the dust they generated immediately became an issue, being linked to everything from damage to merchants’ stocks to diseases of the throat and lungs and even to consumption. What ended up being the most cost-effective solution to this dust problem?
If you would like to participate in this month’s quiz, e-mail your answer to firstname.lastname@example.org by noon, April 15. The winner, who will be chosen randomly from all correct answers, will receive a $50 gift card to a nice restaurant.
Answer to March’s Quiz
The first structural map of an oilfield was published in 1874 by John Franklin Carll of the Pennsylvania Geological Survey. (SPE members might recognize that name.)
Answer to February’s Quiz
The component of natural gas that flows through a hole faster, conducts heat better, and transmits sound at a higher velocity than any other gas except for hydrogen is helium.
Congratulations to February’s winner – Jim Glass with Anadarko