The beginnings of Utah's oil industry were anything but easy. The state's first commercial well didn't start pumping until 1948.
After decades of expensive failed exploration attempts — “dry holes” — the first Utah oil well finally was completed on Sept. 18, 1948, near Vernal in the Uinta Basin.
“The honor of bringing in the state’s first commercial oil well went not to ‘one of the major oil companies, but to an independent, the Equity Oil Co.,” noted Osmond Harline in a 1963 article in Utah Historical Quarterly.
The Ashley Valley No. 1 well, about 10 miles southeast of Vernal, produced about 300 barrels a day from a 4,152-foot-deep well, Harline explained. “It is interesting to note that J.L. (Mike) Dougan, president and general manager of Equity Oil Co. and a Salt Lake City resident, had been drilling for oil in Utah for over 25 years.”
Dougan beat out larger and better financed competitors, including Standard Oil of California, Pure Oil, Continental Oil and Union Oil. Unlike the earlier attempts, Dougan had drilled far beyond the basin’s typical depth of 1,000 feet to 2,000 feet. His Utah discovery quickly launched a deep-drilling boom.
Within three months, eight more wells were drilled. Development of the field quickly followed. Production soon averaged just under 1 million barrels a year from about 30 wells in the booming oilfield.
Exploration companies then begin drilling 5,000 feet to 8,000 feet and even deeper into the Uinta Basin.
Long before the first Utah oil well, signs of petroleum (natural oil seeps) had been noted by geologists near Rozel Point on the northern shore of Great Salt Lake as early as the mid-1850s.
“The exploratory period began in 1850 when Captain Howard Stansbury, while on a survey of the Great Salt Lake for the Army Corps of Topographical Engineers, discovered evidence of ‘petroliem’ along the northern shore of the lake,” explains Utah historian Walter Jones. During the next 40 years Utah explorers found other signs of oil.
Jones reported that in 1891 the Utah Oil Co., whose board included future Utah Gov. Simon Bamberger, drilled a well 1,000 feet deep near Green River. It was a dry hole. During the remainder of the 1890s, oil and natural gas prospectors sank more than two dozen unsuccessful wells in various parts of the state.
Then in March 1908, a former gold prospector named E.L. Goodridge produced an oil gusher in San Juan County, reported Jones, “and by the end of 1909 approximately seven oil companies had started work on no less than twenty-five wells near Mexican Hat.” Jones added that Goodridge’s Mexican Hat oilfield never became a major oil producer, but it and another discovered nearby produced enough oil to supply small local refineries that operated intermittently for years.
Jones also wrote in The Growth of Utah’s Petroleum Industry that in the 1920s enterprising petroleum operators began testing offshore drilling technologies at the Great Salt Lake. The Lakeside Oil Co. drilled on the western shore of the lake and an offshore rig was built on a pier near Rozel Point at the lake’s northern tip. But the state’s petroleum industry was still decades away from its true beginning.
Long before the state’s first commercial well was completed, residents of St. George had hoped the “shooting” of Arrowhead Petroleum Co.’s Escalante No. 1 wildcat well on March 6, 1935, would bring prosperity to their small town a few miles north. Unaware of impending danger, between 70 and 100 people gathered to watch as workers prepared to fracture a sand formation 3,200 feet deep.
An explosion occurred at about 9:40 p.m. while six 10-foot-long torpedoes, “each loaded with nitroglycerin and TNT and hanging from the derrick, were being lowered into the well,” noted the Washington County Historical Society. Ten people lost their lives and dozens were injured by the explosion, which “sent a shaft of fire into the night that was seen as far as 18 miles away.”
Memorial services for the victims were held in the St. George Tabernacle on March 8, 1935. The accident, still Utah’s worst petroleum-related disaster, was in investigated in The Escalante Well Incident, a personal perspective written in 2007 by Clark N. Nelson Sr., “based upon historical accounts, photograph comparisons, abstract conclusions and assumptions, following a search for the former site.”
“Toward the end of World War II, oilmen began to accelerate Utah’s petroleum operations once again,” Jones explained. “From 1945 through 1947 they succeeded in finishing the groundwork necessary to propel the state into a period of commercial oil production.”
The focal point of drilling became the Uinta Basin, where a number of large companies searched. “From the late 1940s until 1957 almost all of Utah’s oil development occurred along the eastern border of the state from the Uinta Basin to the San Juan River,” said Jones. However, major oil companies like Standard Oil of California and Gulf continued to drill only expensive dry holes. The basin’s first commercial oil discovery came in September 1948 – a well drilled by Mike Dougan’s small, independent exploration company.
“Shortly thereafter, Utah was one of the top 15 oil producing states – a position it has held since,” Jones concluded.
Today, the Uinta Basin’s coalbed methane in Utah and Colorado is considered one of the major producing areas in the nation. According to the giant energy service company Halliburton, the basin: “located on a remote desert plateau in Utah and Colorado, and is considered one of the major coalbed methane producing areas in the United States, Uinta is estimated to have between 8 and 10 trillion cubic feet of gas reserves. Coal depths in this basin vary from 1,000 feet to 7,000 feet over a 14,450-square-mile region.”
By 2010, Utah had produced more than 8.1 trillion cubic feet of natural gas valued at more than $1.7 billion. “Utah ranked 11th in the country in oil production during 2014 and 10th in natural gas gross production in 2013. There are approximately 12,300 wells currently in production within the state,” according to the Utah Department of Natural Resources.