A well that shaped the modern "awl bidness": Spindletop at 111

— In case anyone hadn't noticed, January 10 is the 111st anniversary not only of the Texas "awl bidness" (that's Texan for oil business, to all you non-Lone Stars) but also of Big Oil.

On that day in 1901, the Lucas well at Spindletop, a salt dome oil field sited south of what is now the city of Beaumont, Texas came in and was soon producing more than 100,000 b/d of oil.

The Spindletop gusher was a defining moment for an oil industry that was then already several decades old. It was the most prolific oil strike in the world until that time. Spindletop also kicked off an oil exploration boom that moved the energy industry's center of gravity to Texas, shifted the transportation world into a much higher gear and set the stage for widespread use of the automobile.

Oil had long been suspected in the area around Spindletop, which was known for its sulfur springs and bubbling gas seepages. In August 1892, a group of investors that included visionary Pattillo Higgins formed the Gladys City Oil, Gas, and Manufacturing Company to drill exploratory wells. Higgins named the company after Gladys Bingham, a girl in his Sunday School class, according to Clayton Wheat Williams' book "Spindletop Boom Days."

Higgins saw a sign offering land for sale: asking price $6/acre, and grabbed vast tracts of it. Gladys City Oil drilled several dry holes, and most of the investors balked at pouring more money into the venture.

Still, Higgins kept talking to locals about the possiblity of oil deposits under the salt dome formations. They yawned or laughed and teasingly called him "The Millionaire" because he forecasted he would be rich if events panned out as he believed. He even dreamed vividly about oil discoveries.

But most people punctured holes in The Millionaire's oil predictions. State geologist William Kennedy told Higgins he was "wasting your time and money if you are looking for oil or gas here on the coastal prairie." Higgins even wrote to John D. Rockefeller inviting him to invest, although the latter politely declined, saying there was "too much guesswork" in it.

Subsequently, Higgins left Gladys City Oil and teamed with Anthony Lucas, a Croatian native and leading US expert on salt dome formations. Lucas inked a lease agreement in 1899 with Gladys City Oil and later also one with Higgins, and drilled a well to 575 feet before running out of money. Pittsburgh financier Andrew Mellon agreed to underwrite further drilling in a brokered deal that left Lucas with a mere fraction of the potential profits and completely edged out Higgins.

With funds now in place, Lucas spudded a well on October 27, 1900 adjacent to Gladys City Oil lands, using a heavier, more efficient rotary drill bit. For more than two more months, Lucas and his crews wrestled with the difficult oil sands of the salt dome beneath Spindletop.

Wildcatter Michel Halbouty, in recounting the history of that well for Williams' book, recalled the evening of January 9, 1901, when the hill "seemed to light up with a fantastic glow" -- which he called "the St. Elmo's fire, which for centuries had visited the hill."

At 10:30 a.m. the next morning crews felt the ground shake as if a small earthquake rumbled underfoot. Then the well roared as drill pipe shot out of the hole and mud spattered all around, completely drenching crews. One man, Peck Byrd, stood watching and said, "What the hell are we going to do with the damn thing now?" Seconds later oil rushed up with a sound the men likened to a cannon that "had just gone off right in their ears."

According to the Texas State Historical Association, "mud began bubbling from the hole. Startled roughnecks fled as six tons of four-inch drilling pipe came shooting up out of the ground. After several minutes of quiet, mud, then gas, then oil spurted out. The Lucas geyser, found at a depth of 1,139 feet, blew a stream of oil over 100 feet high until it was capped nine days later."

During those nine days, the gusher spewed an estimated 850,000-1 million barrels of oil worth $85-$100 million in today's market. The market price of crude dropped from $2/barrel to 3 cents. Before year-end, 200 more wells were drilled at Spindletop. Lucas' initial well created several companies that were to become industry giants, including Gulf Oil, later merged into Standard Oil of California; Amoco, now part of BP; and Texaco, acquired by Chevron in 2001. Beaumont's 10,000 population tripled in three months and soon reached 50,000.

According to Wikipedia, Spindletop's production declined rapidly after 1902 and totaled just 10,000 b/d by 1904. But the field had a renaissance in November, 1925 when the Yount-Lee Oil Company brought in the McFaddin No. 2 well from a depth of about 2,500 feet. That resulted in another boom with production of about 57,000 b/d in 1927. Spindletop continued to produce until about 1936. It was mined for sulfur from the early 1950s to the mid-1970s.

As for The Millionaire whose initial vision and perseverance made it all happen, Pattillo Higgins sued Lucas and Gladys City Oil for royalties and the parties settled out of court. He formed another oil company at Spindletop and evidently lived up to his moniker since he resided in Beaumont but maintained estates in Houston and San Antonio. He died in San Antonio in 1955.

Lucas went on to serve as a consulting engineer in the US and globally. He died in Washington, D.C. in 1921.

Gladys City exists today as a reconstructed historical site about a mile north of the original Spindletop mound. You can visit it outside Beaumont; details here: http://spindletop.org