Native Americans used black oil that seeped from the ground long before it was commercialized and used to fuel cars, planes, and big industry. History tells us that as far back as 1410, the Iroquois tribe of Western Pennsylvania put oil to a number of uses including as a salve and mosquito repellent, among other things. Later, these Indians would be pushed off their land by settlers who wanted the area for farming. It wasn’t until 1859 that these same settlers realized the value of the large pools of oil beneath their crops. Discovery of oil rocks in Titusville, PA led to an oil rush in Pennsylvania. The oil fever would soon spread to other states, like Texas, where even larger bounties of black gold were found.
The history of oil discoveries in Texas began in Melrose, Nacogdoches County, where the first oil producing well was drilled in 1866. The initial oil exploration in this East Texas town was spearheaded by Lynis Barret, a mercantile owner who wanted to cash in on the lucrative oil business. This initial commercial well only yielded about 10 barrels a day, but spurred others to start looking for oil themselves.
By 1898, oil was also being extracted in Bexar and Hardin counties, near San Antonio and Beaumont, respectively. The discovery of oil in Corsicana and the nearby Powell Field came next. In 1894, the town of Corsicana, 55 miles south of Dallas, started drilling for a new town water well. Instead of finding a new water source, the American Well and Prospecting Company stumbled upon a massive oil discovery. Town residents sought the assistance of experienced oilmen to harness the economic benefits of the discovered oil reserves. Over the next century, the Corsicana oil wells would produce some 44 million barrels of oil.
These smaller discoveries all preceded the great gusher known as Spindletop, which came bursting to life on Jan. 10, 1901, forever changing the course of Texas history. Prospectors had been drilling in the area for several years, and one, Anthony Lucas, was convinced that large oil reserves lay in the salt dome formations beneath the drillers’ feet. The challenge was drilling deep enough and navigating through the tricky soil. Finally, the hard work paid off. On an otherwise ordinary day, roughnecks drilled to a depth of 1,139, unexpectedly hitting the Lucas geyser which first spewed mud, and then a steady stream of gas and oil. It took 9 days for crews to cap the geyser, but this famous well would go on to produce 100,000 barrels of crude oil per day, more than any before its time.
The Birth of an Industry
With major discoveries like Corsicana, Spindletop, and subsequent finds at Goose Creek Field, oil production in Texas increased from 836,039 barrels in 1900 to 4,393,658 in 1901. Now, there was a real need for a modern petroleum industry, which included the construction of refineries to process the crude. In 1919, the Humble Oil Company opened Baytown Refinery in Baytown, TX, just outside of Houston. Today, this refinery, now run by ExxonMobil, is the 2nd largest in the world. This refinery was in a prime location, with close proximity to both the oil fields of East Texas and the Houston Shipping Channel. When offshore drilling in Galveston Bay proved fruitful, the permanence of refineries along the coast was solidified. Between dozens of oil companies, hundreds of rigs, and several refineries, oil became a huge player in the Texas job market and its overall economy.
Drilling on land previously rejected by geologists of major companies resulted in the discovery of the massive East Texas Oil Field in 1930. An unprecedented leasing campaign followed. However, the combination of the Great Depression and a glut of oil sunk prices from $1.10 to 10 cents per barrel. Despite the downturn in prices, development of the field extended northward. Wildcatters drilled new wells at an unprecedented pace, at one point putting 100 new wells into production every day. By 1931, production had peaked at 1,000,000 barrels a day, but life in the small boom towns was out of control. On Aug. 17, 1931, the governor ordered the National Guard to shut down the field in an effort to restore order, and legislation was introduced to cap and stabilize production. Within a short time, the field was reopened. Over 80 years and 4.5 billion barrels of oil later, the wells still produce oil.
West Texas and the Permian Basin
Since the Big Lake discovery of 1923, extraction of oil from the Permian Basin of West Texas and New Mexico has continued on a large scale. Oil discoveries in Texas continued through 1948. Today, the Permian Basin in West Texas contains more than 20 of the top 100 U.S. oil fields, producing from wells ranging in depth from a few hundred feet to tens of thousands of feet. Despite the downturn in oil prices, the Permian Basin remains the most prolific oil producing region in the U.S.
Eagle Ford Shale
The most recent shale play to gain the attention of drilling companies is the Eagle Ford Shale in Southwest Texas. Petrohawk Energy began exploration here in 2002 and by 2010 dozens of oil and gas companies were drilling the area thanks to improved drilling techniques. Production in the area ramped up, and by 2014, Eagle Ford was producing over 800,000 barrels of oil a day. The surge was short-lived however. A devastating drop in oil prices led the majority of wells to cease production. Today, drilling activity is down 85% of what it was at its peak. Some contend that the market has hit bottom and will only go up from here.
Today, 223 of 254 counties in Texas produce oil, natural gas, or both. Texas is the top oil-producing state in the nation. Additionally, the Lone Star state is responsible for nearly 30 percent of total U.S. natural gas production, making it the nation’s leading natural gas producer. The new frontier in Texas is not so much about finding oil in new places, but using horizontal drilling and multi-stage hydraulic fracturing to open up a new, more unconventional chapter in the history of crude oil production in the state.