Utah’s Black Gold: The Petroleum Industry

Osmond L. Harline
Utah Historical Quarterly 31 #3

With the end of World War II, interest in Utah’s oil and gas possibilities was renewed. The annual well-completion rate during 1945, 1946, and 1947 was double the pre-1945 rate, and the stage was set for the birth of the state’s commercial petroleum-producing industry. In contrast to the earlier years, there were numerous geologists who disagreed with the “no-oil-in-Utah” theory. A 1947 writer analyzing the resurge of interest in Utah’s oil exploration noted, “…we have not been able to find a geologist who denies that Utah has favorable structures for oil.” The past failure to obtain commercial production was attributed to drilling “off-formation,” inadequate equipment, and the absence of adequate knowledge or information.

The development of the Rangely oil field in northwestern Colorado caused interest in the early postwar period to center (although not exclusively) in the Uinta Basin. But the postwar explorations were no longer a simple matter of promoting a company with limited funds and sometimes doubtful skill. The “Majors” were active. The list included such companies as Phillips, Standard of California, Stanolind, Texas, Continental, Tidewater Associated, Pure Oil, Sinclair, Union Oil, Carter, and others. The Carter Company was one of the biggest operators in the Uinta Basin.

But the honor of bringing in the state’s first commercial oil well went not to the “Majors” but to an “Independent”—the Equity Oil Company. Ashley Valley No. 1, located about 10 miles southeast of Vernal, Utah, came in at 1:43 p.m., September 18, 1948, with an initial flow of about 300 barrels a day from a depth of 4,152 feet. It is interesting to note that J. L. (Mike) Dougan, president and general manager of Equity and a Salt Lake City resident, had been drilling for oil in Utah for over 25 years.

By the end of 1948, eight more wells were drilled, and in a little over a year development drilling of the field had been completed. Production from Utah’s first commercial field, since discovery, has averaged slightly less than a million barrels a year from the approximately 30 wells within the field, and until 1957, Ashley Valley was the state’s largest producing oil field.

Discovery of this first Utah commercial well touched off a vigorous drilling campaign. Unlike the earlier attempts, these drillings were not shallow depth drilling of 1,000 to 2,000 feet (falling short of what was now considered normal objectives), but rather 5,000 to 8,000 feet and in some instances even deeper. The result was the discovery of the Roosevelt field in 1949, by the Carter Oil Company; the short-lived Gusher field by the California company in 1950; the Red Wash field by Standard of California, and the Duchesne field by the Carter Oil Company, in 1951; and the Brennan Bottom field by the Gulf Oil Corporation and the Chapita Wells field by Continental Oil Company, in 1953.

Of all these Uinta Basin discoveries, the Red Wash was the most important. By 1952, the year after discovery, it was producing half as much as the Ashley Valley field and, at this writing, the Red Wash and its neighboring field, Walker Hollow, are producing over five times as much as Utah’s first commercial field, the Ashley Valley. Unique among the Uinta Basin discoveries was the Roosevelt field with its high pour-point, highly paraffinic crude that sets into solid wax at ordinary room temperatures.

But the big find, which was to move the state from anonymous inclusion in the “all other” column in national crude-oil production reports to a separate Utah listing, was still to come. This find was to occur in the complex of fields known as Greater Aneth located on either side of the San Juan River in the Paradox Basin in the extreme southeast corner of the state. The Boundary Butte field, discovered in 1947 almost on the Utah-Arizona border, had not been termed commercial. Shell Oil Company had made previous field discoveries in the Bluff field in 1951, at Desert Creek in 1954, and at Akah in 1955, but extensive drilling in the region did not begin until after the Aneth discovery. The well which set off the exploration boom was drilled at a depth of 5,896 feet in Section 23, Township 40 South, Range 24 East by the Texas Company. Initial flow was at the rate of 1,704 barrels per day–which helps explain the excitement it created. The confirmation well was completed by Superior Oil Company. By the end of the year, 20 producing wells had been completed in the field, with daily initial flows ranging from 300 to 1,900 barrels and averaging 800 barrels. Operators responsible for the drilling were the Texas Company, Superior Oil Company, Three States Natural Gas Company, Shell Oil Company, and Gulf Oil Corporation, which reads like a roster of the nation’s foremost oil companies.

Greater Aneth actually includes five fields, Cahone Mesa (the smallest producer), White Mesa, Ratherford, Aneth, and McElmo Creek (the largest producer). The approximately 500 producing wells in these five related fields accounts for 70 per cent of Utah’s present crude-oil production.

With the discovery and development of the Greater Aneth fields, Utah moved into the nation’s top dozen producing states. In 1959, there were only 10 states which produced more crude oil than Utah’s 40.1 million barrels, certainly a far cry from the half-million barrels produced in Utah in 1949—the first full year after commercial oil production began. In fact, in 1959, the value of Utah crude-oil production surpassed the value of the state’s copper production, the most important mineral produced in the state (partly because of the prolonged work stoppage in the Utah copper industry). Since 1960, crude-oil production has ranked second (only copper is higher) and ahead of each of Utah’s other minerals in value of product produced.

Since 1959, total barrels of crude oil produced within the state have declined somewhat. The decrease is due to (1) the usual production pattern of new fields to decrease after the initial peak and (2) the inauguration of conservation measures by the industry and the Utah State Oil and Gas Conservation Commission.

Expansion of Utah production in the future will depend primarily on the discovery of new fields. If oil and gas-leasing activity, rate of exploratory drilling, and the opinion of professional geologists are any indication, the possibility of such finds appears to be good. The discovery of the Lisbon field, south of Moab in 1960, is an example.

In August, 1959, the Pure Oil Company spudded in their Northwest Lisbon No.1 (later changed to No. 1 USA). On January 5, 1960, the attention of the entire United States industry was focused on the Paradox Basin when the well became a producer. In fact, the Northwest Lisbon field was designated as the “discovery of the year” by the national petroleum industry, because of the size of the industry, because of the size of the field and because the area had heretofore been considered a poor prospect for oil and gas exploration. Pure Oil’s exploration techniques are a good example of the approach now being used by the industry and bode well for the future of the Utah crude-oil-producing industry. To illustrate, the Four Corners Geological Society had this to say:

Pure has shown how effective a team effort combining land, engineering geophysics, and geology can be…When Major oil reserves become hard to find, this is not the time to reduce the professional staff, but rather a time to encourage imaginative thinking with full utilization of all exploration departments.