That’s Oil, Folks!

Everyone said that the wildcatters of Midland had seen their last glory days, that the fields were dry, and that all the best new plays were offshore. But they didn’t count on an unorthodox drilling formula that would help unlock the hidden reserves of the Permian Basin—and give West Texas one more boom.

oil. Phelps and Johnson had attended the same Sunday school class at Midland’s First Baptist Church. “Maybe there’s a way to get some oil out of the Wolfcamp, maybe not,” Phelps told Johnson with one of his shrugs. “It will always be one of those mysteries, I guess.”

He shook Johnson’s hand, said goodbye, and that seemed to be that.

People in Midland like to say that God felt such remorse about what he did to the land out there that he decided to give it oil. The city is located in the heart of a flat, desertlike landscape, with the closest body of water more than an hour’s drive away. When the wind blows hard, as it often does, the sand whips through the air and hits you in the face, sticking to your eyelids, clogging your throat, and working its way inside your clothes. Tumbleweeds roll down the highway. On especially hot afternoons, says one oilman, “you walk outside and think you’re going to burn to a crisp before you get to your car.”

Midland probably would have remained nothing more than a desolate farming community if it had not been for the Santa Rita No. 1—named after the patron saint of the impossible—blowing in sixty miles away, on some acres owned by the University of Texas, in May 1923. By 1929, there were 36 oil companies with offices in Midland, most of them located in the glamorous new Petroleum Building, built downtown with marble floors and Gothic spires. (Midland’s sister city, Odessa, twenty miles to the west, became the center for the Permian Basin’s oil field service and supply industry.) When the first oil fields began to dry up, oilmen promptly drilled into deeper rock formations such as the Ellenburger or the Spraberry, which was first discovered in 1943 on Abner Spraberry’s ranch in Dawson County.

Midland was hardly immune to the boom-and-bust cycles of the industry. When the price of oil fell in the late sixties, dropping under $4 a barrel by 1970, as many as one quarter of the city’s independent oil companies went out of business. When oil skyrocketed in the late seventies, hitting $37 per barrel (equivalent to more than $95 today), Midland became one of the richest cities, per capita, in the country. Oilmen bought jets to fly themselves and their friends to San Francisco or New York for dinner. They hired designers in Dallas to decorate their second, or third, vacation homes. There was so much money in town that Rolls-Royce went so far as to open a dealership near the airport.

In 1982 eight Midland oilmen—larger-than-life characters such as Carlton Beal (a polo-playing former college professor), Fred M. Allison Jr. (who rented a Concorde to ring in three New Years on the same night), John L. Cox (known as the King of the Spraberry), and Clayton Williams (whose office, the size of a small ballroom, was chock-full of animal heads and lion and bear rugs from his hunting trips)—were included in the very first Forbes 400 list of richest Americans, an amazing statistic considering that the city’s population was only 70,000.

But then the Saudis ramped up oil production from 6 million barrels per day to more than 9 million barrels, the price of oil plummeted, and the city came close to collapse. On October 14, 1983, Midland’s First National Bank, which had been handing out loans to oilmen like toasters, shut its doors—the second-largest independent bank failure in the country. The Rolls-Royce dealership also closed (it became a tortilla factory), and there were so many oil companies, including one run by a young George W. Bush, that went out of business or halted their operations that Midland’s downtown buildings were said to be see-through. The cost of a membership in the 40,000-square-foot Petroleum Club, with its Gone With the Wind—style staircase winding up from the lobby to the dining rooms, dipped to $50 a year, but even then, said the manager, you could shoot a cannon through the place and not hit anyone. “What do you call a geologist in Midland?” went one of the jokes going around town in the mid-eighties. “Hey, waiter!”

Although people prayed openly for a reversal of fortune (“Please God, Just Give Me One More Oil Boom. I Promise Not to Blow It Next Time,” read one popular bumper sticker), there was no more boom. The wilier oil patch veterans, of course, still figured out a way to make money. Autry Stephens, a reticent, bespectacled former appraisal engineer of oil properties for the First National Bank, locked up as much cheap Spraberry acreage as he could and drilled so many wells that his leases looked like pincushions (the Mad Driller, some people admiringly called him). And there was always a handful of young starry-eyed oilmen arriving in Midland, determined to find the mother lode where others had hit dry holes.

One of those young men, David Arrington, an exuberant, sandy-haired former high school cheerleader from Dallas, had applied for a job at 27 oil companies during his senior year at Texas Tech University. They all turned him down, largely because he openly admitted in his interviews that he had taken only two college courses about the oil business: “Oil and Gas Law” and “Oil and Gas Accounting.” Undeterred, he arrived in Midland in 1984—the exact worst time for an oilman—got a job as a rookie landman for a tiny oil company, spent his spare time in Midland’s Subsurface Library researching prospects, found some promising acreage near Kermit, knocked on doors in Midland until he met an investor willing to back his venture, and then hired a company to drill a well. When it surprisingly hit oil, in 1985, he stood by the well, leaped into the air, and did the Herkie, the classic cheerleader move, stretching out his arms and legs in different directions while he shouted, “Yeehaw!”

Arrington soon became Midland’s boy wonder, popping one well after another, a couple of them hallelujah wells drilled horizontally into some of the Basin’s

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