Helmerich & Payne History Chapter 2.4

A Rough and Tumble Business

The oil and gas business of the 1920s and 1930s reflected the times and the Wild West atmosphere of the area.

Many companies operated with a fast-draw, shoot-from-the-hip style, and most deals were struck with a handshake. Paperwork was kept to a minimum, and inventory controls on tools and supplies were often nonexistent. Often government regulations were ignored and reports were incomplete.

In sum, it was a rough-and-tumble, wide- open business. Unfortunately, some of the operators ran with wide-open ethics as well. For example, officers at one bank in Tulsa, owned their own drilling company. When Helmerich attempted to borrow money there on the basis of leases he had signed, he later discovered that the officers' drilling company had undercut Helmerich & Payne's drilling bids on the same leases.

In another instance, Helmerich loaned some tools to a major oil company. The tools were ruined — and when Helmerich complained, he was told, "Let that be a lesson to you. Never loan out your tools."

After Governor "Alfalfa Bill" Murray had shut down the wells in the Oklahoma City field to enforce production quotas, three officers of an oil company arranged to pump oil illegally from Oklahoma City to Seminole where another company had an empty 55,000-gallon storage tank. The company that owned the tank sold the oil, paid the taxes, and kept the profits. The three officers were fired by their company president, who reportedly declared, "If there is any stealing around here, I'll do it myself."


	Walt Helmerich was no stranger to rough-and-tumble tactics if that's what it took to enforce fairness and honest business ethics. As the story goes, he once drilled a well where part of the payment was to be an override on the oil production, when the lease owner knew it was expected to be a gas well. When he had not been paid out of the gas production, Helmerich reportedly stormed into the owner's office. As the man rose from his chair to greet the irate drilling contractor, Helmerich reached across the desk and knocked him back to his seat with a solid punch to the nose. "Now," Helmerich said, "I'm here to negotiate."

	Back from the Edge of Bankruptcy As the decade neared its close and the whole world prepared for war once more, Helmerich & Payne found itself in the midst of its worst financial crisis. The year 1939 was an extremely difficult one for the entire energy industry. Not only had the price of oil dropped, but contract drilling jobs were limited, with few jobs even to bid on. Profits were marginal — or nonexistent.