by Brad Schrade

15-04-07

Anthony Young steps from his sparkling blue 2007 Corvette, his rattlesnake boots firmly planted on an Overton County farm as he surveys the fruits of his luck and labour. His oversize silver belt buckle reads "Young Oil Corp." His cell phone rings incessantly as the tires from the oil tanker trucks crackle across the gravel road.
Self-described hillbilly oilman Young has hit a big one. The oil flowing from a well 1,415 feet deep promises to make this Kentucky-bred oil wildcatter a nice paycheck. When it hit in March, industry officials said it was perhaps one of the biggest oil wells in recent state history.

In fact, Young, a former hairdresser from Knob Lick, Kentucky, estimates he may get 100,000 barrels from the Richard Norrod No. 1 well, named for the farm owner.
"This right here is what makes it go around. Oil," Young said. "It's exciting."
With the spike in prices that has driven gasoline toward $ 3 a gallon at the pump, more Tennesseans are hoping for an oilstrike. New drilling permits issued by the state are at their highest level since the early 1980s, Tennessee's oil heyday. Last year the state issued 386 of them. Tennessee is pumping out more than 300,000 barrels of oil a year, worth nearly $ 15 mm. Natural gas accounted for $ 20 mm more in the latest figures, from 2005. With current prices hovering between $ 50 and $ 60 a barrel, even a relatively small well -- one that produces a few bpd -- can be profitable. Thus the temptation rises for men like Young and their investors to dig into the earth in search of reserves that have been there for millions of years.

You'll have to look hard for oil and gas barons in Tennessee -- they're less the Stetson-wearing, Cadillac-driving, cigar-puffing types out of central casting and more like Ted Lankford. Lankford, 65 and now retired, has moved back to his native Morgan County and has several natural gas wells operating on the 300 acres he owns with his wife. He heats his home, cooks meals and heats the Jacuzzi on the back deck with the gas from his property. Friends from other parts of the country have similar reactions when they learn the Lankfords have wells on their land:
"When I tell them the fact that I'm heating 4,000 sq feet, their eyes get big and they're impressed," he said. "The truth is I'm not getting rich off these wells, but they're like, 'Oh, my, oil and gas.' "

Centred in a cluster of about a dozen counties in the Upper Cumberland and Eastern Highland Rim areas, Tennessee's oil industry has long been a backwoods, minor player in the global market. In fact, Tennessee ranked 27th in oil production in the country, according to federal statistics from 2005.
But commercial oil drilling has been going on in Tennessee since 1866, some seven years after the first major American oil strike occurred in Pennsylvania, according to research by state geologist Ron Zurawski. The first well was in Overton County. But it didn't last long here. Tennessee's rural character made it difficult for oilmen to transport their product and compete with the producers in Pennsylvania. By 1871, production at the Overton well shut down.

Tennessee's fledgling industry continued with minor production until the 1920s, when output increased to around 10,000 barrels a year. Then in 1969, a large field was discovered in Scott County, near Oneida. It produced more than a million and a half barrels, and launched the state's modern-day oil industry.
Driving through the winding roads and hollows of Morgan County, one can see the rusted-out pumps and drums from those early days. Lankford recalls stories his 89-year-old father would tell about the early days of the oil business in his native county, and how they would go to a nearby refinery to fill up the tanks in their vehicle.
"When all the stuff hit out here in the '60s he wasn't surprised," Lankford said. "He recalls seeps from the ground similar to The Beverly Hillbillies, where the guy shot the hill and oil started flowing."

The dubious are drawn
Oil people have a saying: If you can't afford to lose your money without it affecting your lifestyle, you shouldn't get in an oil deal. The common arrangement in Tennessee's oil counties is for the owner of the farm or land to receive a lease fee, a percentage of the profits from any oil that is found, or both.
Bill Goodwin, who served for years as president of the Tennessee Oil and Gas Association, said the increase in prices has attracted some unscrupulous promoters who care more about putting together a deal than hitting oil. He said veterans in the industry frown upon such activity, but these promoters are operating within the law. He said finding oil is a mixture of preparation, research, knowledge of an area and luck.

Goodwin recalled one promoter years ago who took potential investors out in a convertible. The man's wife would sit in the back seat, and when they passed over the desired oil drilling spot she would start feigning convulsions -- a supposed indication that oil was underground.
"That's a true story, but it's no way to find oil," Goodwin said. Likewise, Goodwin periodically gets telephone calls from men of God who say they have a divine hunch that their church may be sitting on oil.

A recent call from a Murfreesboro preacher came after the clergyman had visited a gleaming church in Louisiana that had been paid for by an oil well on the property. Goodwin had to explain to the preacher that Rutherford is not among the state's active oil-producing counties, according to 2005 state records. (The closest county to Nashville that had an active well that year was Robertson, according to the state.)
Goodwin turned down the preacher's offer: "You can't just pray and hope oil's going to be found."

Bob Wright, 62, has a little experience with oilmen who have approached him about drilling on his 112-acre farm in Morgan County. He doesn't much care for them or trust them. When he talks to neighbours or friends in the area, he hears similar sentiments. At the same time, income from the two oil wells and one gas well on his farm helps cover the retiree's expenses. And an oilman years ago drilled an 8,000-foot well on his farm, one of the deepest in the area, and that has led him and others to believe that there may be something down there.

In fact, he's been exploring whether he should set up a trust for his estate to protect his children and grandchildren in the future.
"I do believe some day this may pop a big one," he said. "I want to keep the place in the family and keep it for future generations. I may be sitting on something." His livestock has also taken an interest in the farm's petroleum production. Wright had to help one of his goats after it climbed atop a 15-foot-high oil drum and got stranded.
"She was standing up there, not going anywhere," he said.

It's like playing lottery
Jim Washburn spends his days combing through maps, surveying land and talking to landowners, drillers or anyone else who will talk to him about oil. He's searching for that significant speck of information that may lead him to oil. As Young's geologist, he located the recent Norrod well. Washburn has been in the business for nearly three decades. He said drilling on somebody's property is a bit like buying a lottery ticket. Anticipation and excitement are followed by either jubilation or disappointment. Wells have a distinct odour from the oil pumping up from below the earth's surface. Washburn said experienced oil people have a saying that seems to sum up the nature of their business.
"The oil well on your neighbour’s property stinks," Washburn said. "But the well on your property smells as fresh as perfume. It smells like money."