In time, contract drilling proved to be the lifeblood of the company. In those days, only one well in 50 was a producer, and Helmerich and the others decided it was better to make some money on all drilling rather than lose money on 49 dry holes owned lock, stock, and barrel.

By 1936, Bill Payne had decided to form his own company, and in March he approached Walt Helmerich about selling out. Before the end of that year, Payne struck out on his own and severed all official connections with the company that still carries his name today.

Payne went on to form Big Chief Drilling Company in Oklahoma City, and had a distinguished career in the industry. In 1965, Payne was named the "Outstanding Oklahoma Oil Man" of the year. The same qualities that he helped to mold into the culture of Helmerich & Payne made him a success in his own firm. Helmerich repeatedly declared that he would rather "go broke with Bill Payne than make millions with someone else."

Jack Bates, Helmerich's brother-in-law, also left the company in 1936 in a spin-off of the subsidiary that had been formed with George Reading in 1930. The Reading & Bates operation had handled much of Helmerich & Payne's east Texas production prior to the spin-off.

Although much of its attention had turned to contract drilling by the mid-Thirties, Helmerich & Payne made three significant discoveries during this period which helped the company survive. Two were in known producing areas in Texas and Kansas.

The third was a new discovery in the Texas Panhandle. In Archer County, Texas, the Panther Pool (later known as the Hull-Silk field) had originally been opened to production in 1916. More than two decades later, in 1938, Helmerich & Payne drilled on property acquired from two long-time acquaintances from South Bend days. The initial well flowed 400 to 500 barrels per day.

Far to the West, in Yoakum County of the Texas Panhandle, the company successfully completed a wildcat in August of 1938, in partnership with Continental Oil.However, it was the Hugoton field in southeastern Kansas that was to have the most important long-term impact on the company. The Hugoton field had been operating since 1920 and was recognized as one of the world's largest gas discoveries.

There was already a belief that low-pressure wells in the area could be prolific gas producers. Helmerich & Payne drilled four wells in 1936, and more than 50 years later they were still producing . In fact, the Hugoton field would represent two-thirds of the company's 1995 gas reserves