Richfield was probably the next pioneer. We had two field parties on the slope in 1959. That was under the supervision of Les Brockett and he was the district geologist in Alaska at that time.
I came on the scene in 1960 and ’61. And we couldn’t get the approval to follow up on that field work until 1963.
Ben Ryan, who was the district geologist, and I pushed that very hard and we were successful.
We got a field party on the slope. And that was staffed by Gil Mull and Gar Passell.
Those two young geologists I had drafted to Alaska in 1961 and they were both extremely competent.
And it was during that summer of 1963 that Gar found a live oil seep in tertiary Sagavanirktok formation sandstone along the Sagavanirktok River not far from Sagwon, which is an air strip that was put in by Frontier Airways.
That oil seep was in these tertiary sandstones. And we took them back to the lab and had them analyzed.
And the permeabilities were over two darcies. Gar was really excited by this and the rest of us were as well.
But this was at the extreme northern extension of outcrops as you move north from the Brooks Range through the foothills and onto the Coastal Plain.
And so, anything beyond that to look for younger rocks in particular, the tertiary or the upper cretaceous, most certainly depended upon seismic work.
So, Gar wrote a letter into the office to Leo Fay and Ben Ryan recommending that we initiate seismic—a seismic program that following winter.
And Ben and Charlie Selman, the district geophysicist, sent another letter to me. A couple of paragraphs was all. Ben was a man of few words.
But when he said something, you listened to him very carefully. And I listened. And I also knew Gar and Gil quite well and knew that they wouldn’t go off the deep end.
So, I wrote a much longer letter to Mason Hill and the date of that letter was August the 23rd, 1963. And I made a very, very strong recommendation for hiring a geophysical crew that was available.
It was the United crew 562 that was staffed by Sinclair. But we didn’t know how long that crew would be available, so I—it was imperative, I thought, to move immediately.
Well, Mace didn’t want to move immediately. And that was the year he was president of AAPG, so he was gone a lot.
Long about October, Charlie Selman called me and said, “Harry, if we don’t get that crew, it’s gone.” And he knew Pete Gaffings who was a party manager.
So, I knew that the word was absolutely true. So, Mace being gone, I went to Frank McPhillips, who was the manager of land and the general manager of exploration—he was a land man and a businessman.
Not an explorationist. And I told Mack what the story was and he was in favor. And he took me up to see Bill Travers, who was the executive vice president of exploration and production.
He was a petroleum engineer. But I knew Bill real well and I knew Mack real well. So, they would listen to me and I knew they would.
And I was able to sell them on the idea that we picked up that crew. And that was about a $900,000 commitment for a relatively small integrated oil company.
That was a big, big step for Richfield Oil Corporation in those days. That was big money in those days for anybody when you come right down to it.
But we contracted that crew, put them on the slope, and that was the first indication of our being able to get seismic coverage.
We started out here with a north south line. On the east side of the open acreage that was going to be put up for simultaneous filing.
Now the idea was that we would run three lines. One, two, three in north south because the grain of structure of the country was virtually east west.
So, if you go north south, you can possibly pick up reversals and if they’re extensive enough like some of these surface features over here that are 20 or 30 or 50 miles long if you get a reversal here and get a reversal here and get a reversal here then you’ve probably got an anticline that mirrors the type of structure that we see further south.
And that was the whole theory of initiating the beginning of the seismic coverage that was to extend for several years.
Interviewer: So, were these dynamite data that they were shooting?
These were dynamite data, they’d drill holes, pack them with dynamite, lay out the geophones by hand. In the middle of December, I went up there in December with Charlie and Ben and Gil and Gar as well.
And it was 36 below 0. It was dark all the time and we were staying with the seismic crew, United 562.
They were wooden wanagons on—basically on drill pipe bent to act as sleds and pulled by a D8 Cat right along the line.
And, of course, the surveyors had to get out and survey the line and then the geophones had to be laid out.
The drill holes drilled and then the shot set off. And what you got was paper records. Paper records about that wide with a bunch of squiggly lines on it.
No idea about velocity corrections, there was no common depth point shooting in those days.
And the individual geophysicist had to interpret each one of those records and tie it to the next record from the next shot and so on, all the way along the length of the line.
Then when he got through doing that, then he had to plot it again by hand on paper sections and put the position and the depth as he interpreted it—with whatever the apparent dip was, on that particular line of section.
It was an archaic method of doing geophysics compared to what we do today that’s for sure.
But the interesting thing about it was it worked. It worked to a T. And we found structures. We were able to map not only the structure but some of the stratigraphy.
We had pretty good picks on what part of the section that we were in. We actually could see things as I can show you on the maps of Prudhoe Bay where we picked the unconformity.
The lower cretaceous unconformity. So, those geophysicists working with our geologists did a fantastic job with the kind of data that they had to interpret.
It was really a first class job. No question about it.
Q: So, you collected three north south lines. You collected east west with that survey or did you—
The three north south lines were our first effort. Then I had already mentioned the oil seep, which was picked up in ’63.
We hired another crew, Western 36, later in 1964 and in the winter of ’64 and put them on. And that was to fill in the grid to some extent and shoot some strike lines where we had reversals.
By that time, Richfield was getting in pretty deep financially for our size and so the determination was made that we should probably seek a partner.
And with an overture to Chevron or Standard of Cal in those days that was turned down, why Mace Hill decided that he would speak to JR Jackson of Humble who had an office across the street from us in LA.
And we had a lot of good relationships with the Humble people. We knew them quite well.
He said to JR, “Would you be interested in looking at something of an exploration nature on the North Slope of Alaska?”
And Jack was very receptive to that.
So, we set up a meeting and Mace had me do a show and tell for JR Jackson, who was the manager of the Humble exploration activities on the West Coast.
Dean Morgridge was the geologist. Then Ken Fuller was the geophysicist. And they came over to the office and I showed them the sample from the outcrop with the live oil in it.
And it almost blow through the sand it was so permeable. Of course, being tertiary we didn’t know at that time that that was going to be a great objective.
But be that as it may. We also showed him the first line—the line number one on the east side that went north to the boundary of the state acreage and gave him the information as best we could from the results of our field parties in 1959 and 1963 that had done mapping throughout that area.
And the upshot of it was that JR was pretty well taken with the idea of an entry into that arena as late as Humble was compared to the concentration of other companies that already were up there and actually doing seismic and surface work and all that sort of thing.
Dean Morgridge had worked in Alaska and he was very enthusiastic and Ken Fuller looking at the seismic I don’t think he was quite as impressed and with good reason.
But nevertheless he could see that we were getting data and it was interpretable.
So, JR and et all were able to eventually sell the Humble Board on negotiating a deal.
We made a deal in the summer ’64 and what it really entailed was Humble would spend the next three million dollars of exploration money free to Richfield.
Richfield would be the operator and we would share all the data we had acquired prior to that time and run a joint operation, 50/50 from that point on and that after the three million dollars had been expended that then it would be at 50/50 cost basis from that point forward.
And that was a good fair deal I think to both companies.
Up to that point, we had spent $2.3 million and that was really more than we could swallow or continue to swallow.
Q: That was primarily on the seismic [inaudible]?
A lot of it was on the seismic. Yeah.
This was my ledger sheet of the various activities, the amount of money on the AFE, the beginning and ending of the program. This is the actual cost.
If you notice, that was in pencil because it continually changed.
And then here are the totals from when Richfield stopped, Humble began. That’s their $3 million there at that point.
And from there on, it was 50/50.
Q: I see on there that you’re talking about the Susie Unit number one [ph]. So, maybe we can start talking about some of the early wells there. And I know some of them are Sinclair/ BP, but tell us what you know about it. We can move into Prudhoe Bay then.
The Susie Well was drilled on the first major reversal we saw on line number one headed north.
And we shot a timeline across it and saw that it appeared at least at that stage that we probably had the beginnings of a closed structure.
And we were thinking primarily of cretaceous or maybe even tertiary objectives, but with the idea that we could take it down potentially to the Mississippi and—or to the Pennsylvanian as it turned out.
But that eventually proved too deep. But the Susie Well was in the area of simultaneous filing. And we had picked up a tremendous amount of acreage in that general area between the Colville and Canning.
In those days, one company could hold 250,000 acres in north Alaska as chargeable acreage. They could also hold 250,000 acres in south Alaska.
But these areas were so huge and the amount of leases that we acquired were so enormous that in order to hold that acreage, we would form what we call development contracts, which—with the approval of the U.S.G.S. and BLM you could remove that acreage from chargeability by designing a program and committing a program of exploration and drilling over a given period of time with subsequent drilling obligations as the years went on.
So, we had two development contracts in that area.
The first one was the Sagavan development contract with over half a million acres in it. And we formed a federal unit around the Susie structure after we’d shot it out.
And we drilled that well in 1966 by flying a dismantled rig out of the Kenai Peninsula by rail to Fairbanks and then broke it down into loads that could be put into a C-130 Hercules aircraft.
In the meantime, we had built a gravel strip alongside the location of the Susie Well, which was west of the Sagavanirktok River.
And we had limited gravel, so it was touch and go situation. Unfortunately, we started that during the summer time and had to stop because of all the thawing that took place.
So we had to wait for winter and freeze up in order to put a viable strip. That was the first use of—commercial use of a Hercules aircraft.
It was an Air Force aircraft that was released to Lockheed for a period as I recall of two weeks. And we had that two weeks it was to load that whole rig and all the casing and everything that basically was necessary in big loads to get up and land down on an ice strip on the North Slope of Alaska next to this proposed location. But it worked.
And we drilled the well. It was a dry hole. We had some shows, but they were miniscule. So by that time, the Susie Well had been drilled. This was early 1967.
BP and Sinclair had drilled their six or seven wells in the foothills.
The Colville High which is to the west of Prudhoe Bay was drilled by Sinclair in 1966, ’67.
Dry hole. And seven miles southwest of that again on this Colville High, Union drilled the Kukpuk Well. And that was dry.
So, to my count before we moved to Prudhoe Bay, there were ten significant dry holes drilled on the North Slope exclusive of what had been done in NPR 4 by the Navy.
Q: So, my memory is Colville High is actually shallower structure than Prudhoe.
Well, the Colville High actually is on trend on the Barrow Arch with the Prudhoe High. Having been drilled but with no information released when we finished the Susie Well we did not know what the results were except that they were dry holes.
But we knew the presence of the Colville High. We actually had some acreage on it. But in the meantime, we had leased the Prudhoe High.
We had a very aggressive land department. And they were hand in glove with exploration folks in arranging to do whatever was necessary to acquire the acreage.
We had a philosophy. You can have the best idea in the world, if you ain’t got the land, it isn’t worth a cent.
And there was a lot of truth to that old saw.
And when the state put up the acreage in 1964—late 1964 on the Colville High, Sinclair, BP, Union, Atlantic, and to a much smaller extent, Richfield Humble, bid on that but it was controlled by those other companies.
Later on in 1965, the state in a subsequent competitive sale put up lands on the Prudhoe High.
That was our favorite structure by far and we were quite aggressive in thinking about—we had to have that. In order to have it we had to have the crest.
In order to have the crest, how much money did you have to bid?
Well, the high bids over in Colville had been in the neighborhood of a little over $30 an acre.
We thought that in order to ensure our acquisition of the critical tracts on Prudhoe we’re going to have to bid at least double, maybe triple that amount.
So Ben Ryan and Charlie Selman and I got together, and we recommended bids on those top tracts of approximately $100 an acre.
Wiser hands in the company knocked that down to about $93, but that’s what we bid.
then we graduated our bids down as moved down the flank. BP on the other hand bid a flat as I recall $40 some odd dollars per acre--$47 per acre I think—flat all across the structure.
We got the top as we won. We got 28 blocks which basically was 90,000 acres. BP got the flanking acreage down dip from us.
Little did we know at that time that the crest of the structure was gas cap, and the flank was oil rig. BP came out to smelling like a rose with the lesser bid, but we were happy as a clam because who in the world figures you’re going to have a 400 foot gas cap.
The subsequent thing I think was very important, and this was a moral commitment if not a legal commitment for Richfield and Humble to drill the Prudhoe Bay well.
I was told in no uncertain terms by corporate headquarters that I should use my good offices with Governor Wally Hickel, who was a friend of mine, I knew Wally fairly well, that we could not drill at Prudhoe because the offshore waters of Prudhoe Bay were immediately adjacent to the location that we had picked. You don’t drill a multi-million dollar well with open acreage right next door.
I called Wally and asked him if he would hold a special sale for offshore Prudhoe Bay, and I explained why and told him it was not critical that we obtain the acreage, but just so that the acreage was under the ownership of another entity so that we could at least deal with them if somebody else got it. They did hold the sale early in 1967.
We bid on it. We acquired it. That finished the structural closure as far as our acreage position was concerned so we were able to go ahead.
I always considered that to be a real commitment. I don’t think you go to the governor of a sovereign state and ask him for something like that and then a couple of months later back out of it.
In my mind at any rate, that was a very decisive point in drilling the well.
Interviewer: Can I back you up one minute? Because you made a very critical point and then you kind of jumped through it.
You said that your company was more attracted to Prudhoe Bay than Colville. Prudhoe was your preferred area. Why? What specifically made you favor that over Colville?
Okay, well several things. One we had good definition of the structure at Prudhoe.
We saw the general structure, but we also saw faulting on the north side. We saw the truncation by the lower cretaceous unconformity, which cuts into the section from—basically from southwest towards the northeast.
And as we eventually proved, cuts all the way down into basement eventually.
That looked as if that combination type trap with a structural reversal, faulting on the north side, truncation on the northeast side,
tremendous feeding area from source rocks, that we could pretty well identify down to the south coming all the way out of the Colville trough and depths of 25 or 30,000 feet, were all feeding directly up into Prudhoe Bay.
Now Colville High to the west is higher structurally, but there also are separating faults, we later found they were separating, that were trend northwest, southeast in the low between Prudhoe Bay and Colville.
Also we had—I remind you that we did not have the information from the Colville Well nor from the Kukpuk Well so we didn’t know what they had obtained.
Our conclusion had been that the northwest and northern closure of the Colville High was questionable because of velocity corrections, as you move out towards the coast based upon the wedging of the permafrost and the unknown velocity corrections that you have to put in to account for that.
And the other situation is that the Barrow Arch in a general sense plunges from northwest to the southeast so structures to the west are higher, but they’re also subject to being open to drainage on up the basic arch structure.
So those were the primary reasons. But we saw the—I think we put quite a bit of emphasis on the fact that it was an almost classic combination trap with truncation, faulting, and folding all in the right place, hopefully at the right time.