This Week in Petroleum History – January 7 to January 13
January 7, 1905 – Discovery of Humble Oil Field leads to Major Oil Company
The Humble oil field in Harris County, Texas, is discovered by C. E. Barrett. His Beatty No. 2 well will yield 8,500 barrels a day and launch an oil boom.
The small community of Humble will grow from 700 to 20,000 in a few months. Overall production from the field – the largest in Texas for the year 1905 – reaches almost 16 million barrels of oil.
Natural gas had been discovered on “Moonshine Hill” in October 1904 by Higgins Oil and Fuel Company. Early reports of natural gas seepage in the area were not uncommon in the late 19th century.
According to a 1972 historical marker in downtown Humble, the oil field leads to the creation of the Humble Oil and Refining Company in 1911 by a group of its operators, including Ross Sterling, a future governor of Texas.
“Production from several strata here exceeded the total for fabulous Spindletop by 1946,” the marker notes. “Known as the greatest salt dome field, Humble still produces and the town for which it was named continues to thrive.”
Humble Oil Company will consolidate operations with Standard Oil of New Jersey, eventually leading to Exxon and today’s ExxonMobil.
January 7, 1913 – Improved “Gasolene” Refining Process patented in Time for Autos
William Burton of the Standard Oil Company of Whiting, Indiana, is issued a patent (No. 1049667) for a refining process that effectively doubles the amount of “gasolene” produced from each barrel of oil.
Because commercial (and coal-fueled) electricity is being made available to more and more homes and businesses, demand on the petroleum industry for kerosene has plummeted.
However, America’s need for gasoline is growing along with the increased popularity – and affordability – of Ford and other automobiles. Burton’s innovation, called thermal cracking, is a breakthrough valued at $70 million. His process is superseded by catalytic cracking in 1937.
January 7, 1957 – Michigan’s Oil Field of Dreams
After more than two years of drilling, the Houseknecht No. 1 well discovers Michigan’s largest oil field. The 3,576-foot-deep well in southwestern Michigan produces from the Black River formation of the Trenton zone.
Local lore says that the well’s namesake, Ferne Houseknecht, had been told by a spiritualist that there was oil under her farm. Houseknecht convinced her uncle, Clifford Perry, to help drill a well – one joint of pipe at a time between his other farm projects.
The Houseknecht No. 1 discovery at “Rattlesnake Gulch” prompts a local drilling boom that ultimately leads to 734 wells and produces more than 150 million barrels of oil and 250 billion cubic feet of natural gas.
“The story of the discovery well of Michigan’s only ‘giant’ oil field, using the worldwide definition of having produced more than 100 million barrels of oil from a single contiguous reservoir is the stuff of dreams, and of oilfield legends,” explains Michigan historian and author Jack Westbrook.
“One version of the legend says that a fortune teller told young Ferne Houseknect that a ‘black river of oil’ lay beneath her property in Hillsdale County,” he notes. “Another version of the story says that the Houseknects were taking a cow to be bred and on the way drove past a drilling rig where Perry was working and from their conversation a deal was struck.”
January 8, 1864 – Oil Discovery at Pithole Creek in Pennsylvania
The Pithole Creek field is discovered in Venango County, Pennsylvania, by the United States Petroleum Company. The well reportedly is located with a witch-hazel dowser and comes in as a gusher at 250 barrels a day.
Pithole will make history as an early oil boom town for America’s new petroleum industry, which began in nearby Titusville in 1859. “Many factors fueled the Pithole oil boom,” explains an article for certificate collectors – scripophily.
“The end of the Civil War found the country flooded with paper currency whose holders were anxious to invest and make more money. Thousands of soldiers had been discharged from the army,” notes the scripophily article.
Many veterans wanted jobs, others wanted to make a fortune quickly after having spent long months on army pay. “The speculative bubble of 1864 and 1865 was at its peak,” the article concludes.
“Hundreds of newly-organized companies were ready to lease or buy land wherever there was even a promise of oil. Fired by these circumstances, the Pithole Creek became spectacular.”
Visit Titusville’s Drake Well Museum, which maintains a visitors center at the ghost town of Pithole.
January 9, 1862 – Oil exported during Civil War arrives in London
America exports oil for the first time when the brig Elizabeth Watts arrives at London’s Victoria dock after a six-week voyage from Philadelphia.
The vessel carries 901 barrels of oil and 428 barrels of kerosene from the booming oilfields of Oil Creek, Pennsylvania.
No ship has ever crossed the Atlantic bearing such cargo. In America, anxious sailors had feared the vessel would explode before casting off on November 19, 1861.
The shippers are the highly successful Philadelphia import-export firm of Peter Wright & Sons, which since its founding in 1818 has prospered transporting “china, glass, and Queensware” among other commodities.
Within a year Philadelphia will export 239,000 barrels of oil – without the technology of railroad tank cars or “tanker” ships. America will become a net importer of oil in 1948.
January 10, 1870 – Rockefeller incorporates Standard Oil Company
Seven years after leaving his successful commercial mercantile partnership to enter the petroleum refining business, John D. Rockefeller and five partners absorb the firm of Rockefeller, Andrews & Flagler to form the Standard Oil Company in Cleveland, Ohio.
With $1 million in capital and an initial market share of about 10 percent, Standard Oil focuses on efficiency and growth. Instead of buying barrels, it buys tracts of oak timber, hauls the dried timber to Cleveland on its own wagons, and builds the barrels in its own cooperage. Standard’s cost per barrel drops from $3 to less than $1.50.
The company’s increasingly efficient refineries extract more kerosene per barrel of oil (there is no market for gasoline at the time). Along with vertical integration and innovative technologies, the company purchases properties through subsidiaries, co-opts competitors, and uses local price-cutting to capture 90 percent of America’s refining capacity.
Rockefeller will continue his control over the domestic petroleum industry by reorganizing his assets into the Standard Oil Trust on January 2, 1882. More legal maneuvering will preserve his empire until 1911.
January 10, 1901 – Spindletop Discovery launches Modern Petroleum Industry
The modern oil and natural gas industry is born on a hill in southeastern Texas, when a wildcat well erupts on Spindletop Hill in Beaumont. The discovery will change the future of American industry and transportation – and bring new oil field technologies.
The Texas discovery will change the way people would live all over the world, proclaims legendary Houston oilman Michel T. Halbouty in 1952. ““It revived the industrial revolution…caused the United States to become a world power…(and) revolutionized transportation through the automobile industry.”
The southeastern Texas oil boom is welcomed. It comes just four months after the deadliest hurricane in U.S. history has devastated nearby Galveston.
The story of the Spindletop discovery well – which popularizes rotary drilling technology – begins more than a decade earlier when the Gladys City Oil, Gas & Manufacturing Company is formed by Patillo Higgins.
Higgins, a one-armed mechanic and self-taught geologist, is one of the few at the time who believes U.S. industries will soon switch fuels from coal to oil. Nobody foresees the coming demand for gasoline to fuel automobiles.
Higgins is convinced that the “Big Hill” four miles south of Beaumont has oil – despite conventional wisdom to the contrary. Through the latter half of the 19th century, Pennsylvania had been the most oil-productive state in the country, notes an article by the Paleontological Research Institution (PRI).
This is the first discovery of the prolific salt dome structures along the coast of the Gulf of Mexico. The well is not brought under control for nine days, losing an estimated 850,000 barrels of oil. According to PRI, a new device – now called a “Christmas Tree” – is invented on the spot to control the flow of oil.
“Fishtail drilling bits gave way to the Hughes Tool rotary rock bit.” adds another historian. “The movers and shakers of the oil industry converged on Houston in the early 1900s and the city still reigns today as the energy capital of the world.”
Two Beaumont museums tell the story of the Spindletop discovery – and today’s role of the petroleum industry in America’s economic development. Read more in “Spindletop creates Modern Petroleum Industry.”
Until the “Lucas Gusher,” Texas had produced only minor amounts of oil, starting with a well in 1866 drilled by Lyne Taliaferro Barret near the East Texas town of Nacogdoches. See “First Lone Star Discovery.”
January 10, 1919 – Elk Hills Field discovery in California
The Elk Hills field in Kern County, California, is discovered by Standard Oil of California’s No. 1 Hay well at 2,500 feet on faulted anticlines.
“Elk Hills Oil Field in California’s San Joaquin Valley ranks among the most productive oil fields in the United States,” notes an Earth Observatory website maintained by NASA.
The oil field was embroiled in the early 1920s lease scandals during the administration of President Warren Harding - Teapot Dome – and returned to the government management.
Privatized again in the 1990s, Elk Hills yielded its billionth barrel of oil in 1992 – becoming the thirteenth oil field in U.S. history to pass that milestone.
The historic California oil field continues to serve as a contingency source of petroleum for the U.S. Navy (Naval Petroleum Reserve One). Visit the “Black Gold” exhibit of the Kern County Museum in Bakersfield and at the West Kern Oil Museum in Taft.
January 10, 1921 – Major Oil Strike brings Boom to El Dorado, Arkansas
The Busey-Armstrong No. 1 well strikes oil and catapults the population of El Dorado, Arkansas, from 4,000 to 25,000. H.L. Hunt will soon arrive with a borrowed $50. He joins lease traders and speculators at the Garrett Hotel – where fortunes will be made and lost.
“Located on a hill a little over a mile southwest of El Dorado and the derrick was plainly visible from the town,” several historians note. A small crowd of eager spectators gathered at the rig. ”Suddenly, with a deafening roar, ‘a thick black column’ of gas and oil and water shot out of the well.”
“Union County’s dream of oil had come true,” says the local paper. ”Busey No. 1, the ‘Discovery Well’ of the El Dorado Oil Field yielded 15,000,000 to 35,000,000 cubic feet of gas and from 3,000 to 10,000 barrels of oil and water a day.”
Its 68-square-mile field will lead U.S. oil output in 1925 – with production reaching 70 million barrels. Prior to the discovery, the area’s economy relied upon cotton and the timber industry “that thrived in the vast virgin forests of southern Arkansas.”
January 11, 1926 – Hutchinson County, Texas, Discovery adds to Modern Art
Dixon Creek Oil and Refining Company brings in the Smith No. 1 well flowing 10,000 barrels a day in southern Hutchinson County, Texas.
A. P. “Ace” Borger from Tulsa, Oklahoma, quickly secures a 240-acre tract and by September the Borger Oil Field has 813 producing wells, yielding 165,000 barrels a day.
Borger will lay out streets for the town, which grows to a city of 15,000 in 90 days.
American artist Thomas Hart Benton visits the newborn boom town of Borger, noting, “there was a carbon (black) mill out there that burnt thousands of cubic feet of gas every minute, a great, wasteful, extravagant burning of resources for momentary profit.”
Benton adds, “There was a belief, written in men’s faces, that all would find a share in the gifts of this mushroom town…Borger on the boom was a big party…where capital…joined hands with everybody in a great democratic dance.”
Burton will paint Boomtown in 1928. Today at the Memorial Art Gallery of the University of Rochester, Rochester, New York, it is “one of the masterpieces of the Gallery’s collection because of its impressive and unique depiction of an American landscape.”
Dedicated in 1977, the Hutchinson County Boom Town Museum celebrates Oil Boom Heritage every March. Special exhibits, events, and school tours occur throughout the Borger celebration. The museum, located in a 1927 building, maintains an exhibit across the street — a standard drilling rig with related equipment.
January 13, 1957 – A Petroleum Product takes off
The new petroleum product is born in California when Wham-O Manufacturing Company begins production of the Frisbee.
The plastic toy had originated in 1948 when two World War II veterans formed Partners in Plastic to sell their newly invented “Flyin’ Saucers” for 25 cents each.
Wham-O bought the rights to the “flying toy” in 1955 – one year after Phillips Petroleum had introduced a high-density polyethylene under the brand name Marlex.
Although Phillips marketing executives expected the product to be a big hit, customers failed to materialize for the revolutionary plastic. The Bartlesville, Oklahoma, company found itself with warehouses full of Marlex – until the phenomenal demand for Wham-O Hula Hoop and Frisbee. Read more in “Petroleum Product Hoopla.”
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