I have been urged lately by some E&P staffers to write my column in the Ph.D. Bill voice and not in the Good Ole Bill voice. I do use the Ph.D. voice from time to time but I much prefer the other voice and, I think, for good reason. That is because, with the Good Ole voice, I can write more about people. It’s easy when working on a technical publication to become enamored of the amazing technology we see regularly. That is as it should be. To write well about something one must not only understand the subject but also have an appreciation for it. The only peril is that, from time to time, we lose sight of the people who make the technology work. This is, after all, a people business. Without them, all the technology in the world won’t produce the energy we need. So I will keep writing in my favorite voice frequently with forays into the more orderly, argumentative world when need be.

I received a couple of notes from Arlie Skov in response to a recent column in which I mentioned a number of defunct oil and gas companies, among them Sohio. Many of you know Arlie from the business and many more from his activities, including the presidency, with the Society of Petroleum Engineers (SPE). Arlie and I both worked for Sohio although we did not meet until much later through SPE. Arlie sent me some interesting observations on the Spraberry Driver Unit in West Texas. The Driver Unit comprised some 570 wells under water flood until the early seventies and, primarily, on beam pumps thereafter. It was operated by Sohio. Below are some of Arlie’s musings on the Driver Unit, printed here with his kind permission.

“By the early ’70s, what with low oil prices and low oil production rates from the Driver Unit, I had been entrusted with writing all of the Letter Ballots and for obtaining their approval. Since the Driver Unit had over 400 individual working interest owners, and any major unit activity, such as a large capital investment or a change in operations, required a certain percentage approval from all these owners, we were sending out a lot of them. But interest in Spraberry had faded by then and many owners simply ignored the Letter Ballots. So I spent a lot of time on the telephone, pleading with owners to send them back.

I should mention that many of the working interest owners in Spraberry were the huge Hollywood stars of the day — 10 to 12 from the Gregory Peck era. Promoters had gotten to them when the Korean War caused high incremental income tax rates with stories about all the oil in Spraberry and, significantly, a thing called the “intangible investment tax credit!” The stars themselves, or course, neither knew nor cared anything about the oil business so we dealt with their agents. Sometimes getting the stars, through their agents, to sign the original Unit Agreement itself took some real arm twisting. In one case, our top man in Oklahoma City, Okla., a crusty old man named Frank Willibrand, used “insulting” language to an agent who said, “I’ll have you know I represent my client in a fiduciary capacity!” So Frank said, “well, tell your client that you have just 'fiduced' him out of $3 million.’”

Arlie also reminded me of the “old oil” and “new oil” tiered pricing structure dictated by the US government during the seventies. “Old oil” prices (US $3-4 bbl) were meant to control inflation and oil company profits while “new oil” prices ($12-15 bbl) were meant to spur exploration and new oil production. “Since wells making 10 bopd or less were barely economic anyway (and were also mostly owned by independents and small operators with a lot more political clout) they were arbitrarily given new oil prices.” The price tier was determined by average production per well across a field rather than by actual production per well. As the average production from the Driver Unit’s 570 wells was just under 10 b/d of oil, the pricing policy was a windfall for Sohio if, as Arlie points out, they stayed BELOW 10 b/d of oil average per well!

Arlie finished up his work on the Driver Unit in the early '70s, just as I started there, and moved on to BP Alaska to help unitize the Prudhoe Bay field. Thanks Arlie.