First production from three deepwater wells in the GOM Nansen field off the world’s first truss spar featuring an open truss structure is reported by operating partners Kerr-McGee and Ocean Energy. (Remember them?) Johnnie Burton, a bureaucrat from Wyoming, is named director of the US Minerals Management Service. (Can you recall another notable Wyoming bureaucrat that later took a formidable position in the oil industry? See History Quiz.)
Light, sweet crude: $19.96/bbl
Natural gas: $2.13/MMbtu
Pirates operating in the Gulf of Aden hijack the MV Longchamp, a German tanker bound from Europe to the Far East with a cargo of LPG. Warships from the US, UK, France, Germany, China and South Korea are ordered to the region.
Small, independent oil companies, including Kosmos and Tullow, jump on the Western Africa oil rush by drilling deepwater Cretaceous sands off Ghana that may extend from Benin westward to Sierra Leone.
Light, sweet crude: $64.32/bbl
Natural gas: $3.72/MMbtu
Sierra Club and Public Justice file what is called a “fracking lawsuit” against three independent producers in Western Oklahoma in response to increased Sooner State seismic activity.
The BP Energy Outlook forecasts fossil fuels to be the dominant global fossil fuel through 2035, with demand for natural gas rising at 1.8 percent per year and demand for oil rising at 0.9 percent per year.
Light, sweet crude: $33.00/bbl
Natural gas: $1.95/MMbtu
THE REST OF THE YARN
This month, McCarthy endures a series of make- or-break meetings with his creditors.
All through the early months of 1950, McCarthy endured a series of difficult meetings with his creditors in Houston and New York. When Metropolitan ordered a new estimate of McCarthy’s oil and gas reserves, it was stunned to find they were down by almost two-thirds in several key fields. While McCarthy blamed the drop on foreign oil, Metropolitan’s engineers deduced that the greatest damage to the reserves had been administered by McCarthy himself. In his rush to raise cash, he had pumped so much natural gas so quickly that well pressures could not be maintained, rendering wells less productive, and in some cases, no longer productive at all. Auditors uncovered telltale hints of financial chicanery. Wells had been completed and put on McCarthy’s books when it was doubtful they would ever produce commercial quantities of oil or gas. The lesser wells – whether weak from the start or crippled by McCarthy’s haste – had been abandoned in droves without his telling the creditors.
Behind closed doors, executives at Equitable and Metropolitan Life pondered whether to foreclose. They ultimately decided against it, fearing the public relations nightmare of crippling a Texas legend, and at the same time, realizing that the Shamrock, if run properly, might yet turn a profit. In May 1950, McCarthy hammered out a deal in which Metropolitan ponied up an additional $6 million in cash in exchange for liens on his New Ulm field. Equitable, however, was out of patience, and its board decided the only way to bring McCarthy’s spending under control was to take control itself – gradually and in private, so as not to antagonize McCarthy or those in Texas who regarded him as a hero. Months of secret meetings culminated in a signed agreement in which McCarthy reluctantly ceded complete control over his oil fields to Equitable for 10 years, as well as the Shamrock and just about everything else he owned. McCarthy would still run things, but under the watchful eye of a comptroller Equitable brought in to oversee his finances.
Next month, the deal quickly falls apart, and McCarthy is ousted as president of his companies.
What notable Wyoming bureaucrat later took a formidable position in the oil industry?
If you would like to participate in this month’s quiz, e-mail your answer to email@example.com by noon, February 15.
The winner, who will be chosen randomly from all correct answers, will receive a $50 restaurant gift card, courtesy of the ProTechnics Division of Core Laboratories.
ANSWER TO JANUARY'S QUIZ
Perestroika was the term used by the Soviets to describe the political movement for reformation within the Communist Party of the Soviet Union in the 1980s.
CONGRATULATIONS TO DECEMBER’S WINNER
Walt Laflin with NOV Downhole Engineering