Everyone knew it was crazy to try to extract oil and natural gas buried in shale rock deep below the ground. Everyone, that is, except a few reckless wildcatters - who risked their careers to prove the world wrong.
Things looked grim for American energy in 2006. Oil production was in steep decline and natural gas was hard to find. The Iraq War threatened the nation’s already tenuous relations with the Middle East. China was rapidly industrializing and competing for resources. Major oil companies had just about given up on new discoveries on U.S. soil, and a new energy crisis seemed likely.
But a handful of men believed everything was about to change.
Far from the limelight, Aubrey McClendon, Harold Hamm, Mark Papa, and other wildcatters were determined to tap massive deposits of oil and gas that Exxon, Chevron, and other giants had dismissed as a waste of time. By experimenting with hydraulic fracturing through extremely dense shale—a process now known as fracking—the wildcatters started a revolution. In just a few years, they solved America’s dependence on imported energy, triggered a global environmental controversy—and made and lost astonishing fortunes.
No one understands these men—their ambitions, personalities, methods, and foibles—better than the award-winning Wall Street Journal reporter Gregory Zuckerman. His exclusive access enabled him to get close to the frackers and chronicle the untold story of how they transformed the nation and the world. The result is a dramatic narrative tracking a brutal competition among headstrong drillers. It stretches from the barren fields of North Dakota and the rolling hills of northeastern Pennsylvania to cluttered pickup trucks in Texas and tense Wall Street boardrooms.
Activists argue that the same methods that are creating so much new energy are also harming our water supply and threatening environmental chaos. The Frackers tells the story of the angry opposition unleashed by this revolution and explores just how dangerous fracking really is.
The frackers have already transformed the economic, environmental, and geopolitical course of history. Now, like the Rockefellers and the Gettys before them, they’re using their wealth and power to influence politics, education, entertainment, sports, and many other fields. Their story is one of the most important of our time.
GEORGE MITCHELL, the son of a Greek goatherd, who tried to tap rock that experts deemed worthless but faced an unexpected obstacle in his quest to change history.
AUBREY McCLENDON, the charismatic scion of an Oklahoma energy family, who scored billions leading a historic land grab. He wasn’t prepared for the shocking fallout of his discoveries.
TOM WARD, who overcame a troubled childhood to become one of the nation’s wealthiest men. He could handle natural-gas fields but had more trouble with a Wall Street power broker.
HAROLD HAMM, the son of poor sharecroppers, who believed America had more oil than anyone imagined. Hamm was determined to find the crude before others caught on.
CHARIF SOUKI, the dashing Lebanese immigrant who saw his career crumble and his fortune disintegrate, leaving one last, unlikely chance for success.
MARK PAPA, the Enron castoff who panicked when he realized a resurgence of American natural gas was at hand, one that his company wasn’t prepared for.
Gregory Zuckerman is a special writer at The Wall Street Journal and the bestselling author of The Greatest Trade Ever. He is a two-time winner of the Gerald Loeb Award and a winner of the New York Press Club Journalism Award. He lives in New Jersey with his wife and two sons.Excerpt. © Reprinted by permission. All rights reserved.:
William Butler was up nights, full of worry.
The grizzled eighty-three-year-old rancher in South Texas owed millions of dollars to various lenders, had almost nothing in the bank, and feared his two sons wouldn’t be able to manage when he was gone.
Butler had the look of someone just off the set of a John Ford movie. Tall and broad, he tended his cattle in a flannel shirt, blue jeans, and muddy boots. He went by the nickname “Buck,” spent seven days a week working with thousands of cows on his ranch, and in his old age relied on a walking stick made from the manhood of a two-thousand-pound Brahma bull.
Buck Butler was no cinema hero, however. A series of local schemers and connivers had taken advantage of him over the years. Butler compounded his problems by plowing all his free cash into nearby land, usually telling his nervous wife, Vera, about the purchases only after they had been completed.
By 2009, Butler faced growing difficulties with his business and was coping with a nervous system disorder. Vera began taking medication to calm her own nerves.
“When you owe over three million dollars you worry,” she explains.
Less than four years later, on a warm January afternoon in 2013, I bounced around the front seat of Butler’s new Dodge pickup as he told the story of how his difficult days had come to an end and a new life had begun.
Pointing to his rolling acreage like a proud parent, Butler described how one day—just over two years earlier—a representative of Conoco Phillips had come knocking on his office door to ask if the huge oil company could drill on his property. It turned out that a type of rock called shale was buried more than a mile below its surface. The rock was soaked with oil that suddenly had become accessible. Almost overnight, Butler’s land was transformed into some of the most valuable acreage in the world.
Butler parked his truck outside a Mexican restaurant in Nixon, Texas, population twenty-four hundred, and turned to me with piercing blue eyes.
“It’s goddamn unbelievable what’s happened to me in the last two years,” he said, a smile of relief forming on his rugged face. “I have to reach out and pinch myself, it’s too good to be true.”
I was a business reporter from New York on a visit to South Texas in search of a story. My crisp blue Yankees cap seemed to clash with Butler’s scuffed cowboy hat, and his honeyed Texas twang sometimes sounded like an entirely new language. I had spent a career at the Wall Street Journal writing about men and women who traded stocks and bonds, not livestock. Before I began my research, “frack” was the kind of word I’d caution my kids to avoid.
At that moment, though, I was sure my Marlboro Man’s tale, and the stories of others I had heard in places like Williston, North Dakota, New Milford, Pennsylvania, and Lexington, Oklahoma, were among the most compelling a writer could hope to find. Buck Butler and others at the heart of one of the greatest energy revolutions in history had experienced astonishing and unexpected change thanks to American oil and gas discoveries deemed unthinkable just a few years ago. The nation itself had been transformed, as had the world.
The more work I put into the topic, the clearer it became that a burst of drilling in shale and other long-overlooked rock formations had created the biggest phenomenon to hit the business world since the housing and technology booms. In some ways, the impact of the energy bonanza might be more dramatic than the previous expansions, especially if shale drilling catches on around the globe. Surging oil and gas production likely will affect governments, companies, and individuals in remarkable ways for decades to come.
Consider the following:
• As recently as 2006, business and government leaders fretted that America was running out of energy. By 2013, however, the United States was producing seven and a half million barrels of crude oil each day, up from five million in 2005. The country enjoyed its largest production increase in history in 2012 and could pump more than eleven million barrels a day by 2020, its highest figure ever and more than even Saudi Arabia currently produces.
So much oil is flowing that in a few more years, the United States may not need to import any crude, or might only rely on friends such as Canada and Mexico, ending a fifty-year addiction to oil from countries with interests that many years ago diverged from ours. In 2013, Saudi Arabia’s billionaire prince Alwaleed bin Talal said the kingdom’s oil-dependent economy had become vulnerable to rising U.S. energy production, a shocking turnaround from a few years ago when America seemed hopelessly dependent on Middle Eastern oil.
• America already is the world’s largest producer of natural gas, thanks to shale drilling, and the country sits on two of the world’s largest gas fields. Gas production has soared 20 percent in five years, and the United States now should have enough gas to last generations. Soon, the nation will begin exporting gas, an unimaginable possibility just a few years ago when energy supplies looked set to run out and the construction of gas importing facilities was considered a matter of national urgency.
• Rising production from dense rock has sent natural gas prices tumbling 75 percent since 2008. Because gas is used to heat and cool homes, produce electricity, grow food, power some vehicles, and make plastic, steel, and other products, the American gusher has been a boon to consumers and businesses, many of whom are still suffering from the worst economic downturn since the Great Depression. Meanwhile, growing U.S. oil production has allowed the country to enforce a boycott of crude from Iran at relatively little cost, and it could help keep a lid on global prices for years to come.
• The energy boom could generate more than two million new jobs by 2020, offsetting the jobs lost in the housing market’s collapse. Hiring is on the rise in Texas, Oklahoma, and Louisiana, as well as in Ohio, Wyoming, West Virginia, and Pennsylvania, a shot in the arm for many long-struggling regions. North Dakota enjoys an unemployment rate of about 3 percent, a Walmart in the heart of the state’s oil region pays employees twenty-two dollars an hour, and some local McDonald’s outlets have resorted to offering bonuses of $300 and thirty-two-inch flat-screen televisions to lure new employees.1
• Electricity and natural gas prices are so much cheaper in the United States than in most other countries that they could help usher in a new era of American economic dominance. A “reshoring” trend already is under way, as steel, chemical, fertilizer, plastics, tire, and other companies move production back to the country or expand existing factories, while foreign firms build new plants in the United States. The shift is helping to bring back some jobs once believed to have been lost forever to China and other low-cost economies. Some even see a manufacturing rebound in the making as “made in the USA” again becomes de rigueur.
• All the newfound oil and gas, along with expected energy exports, are slashing the nation’s trade deficit and could boost the value of the U.S. dollar. The explosion of oil also has defense specialists debating whether the United States may be able to avoid certain future military actions aimed at securing energy supplies, allowing the country to trim its bloated defense budget and perhaps cede some security responsibilities to other countries, like China, that remain dependent on Middle East oil production.
• China, Russia, Argentina, and Mexico are among the countries with their own deep pockets of shale that may be tapped in the years ahead, while government officials in the United Kingdom and elsewhere have urged their countries to embrace shale drilling. In fact, global gas production could rise by 50 percent by 2035, some analysts say, helping consumers and businesses around the world.
But troubling questions have been raised about the environmental consequences of some of the production methods responsible for soaring oil and gas supplies, including hydraulic fracturing, or “fracking.” Some worry about their impact on air and water quality, while others are concerned that fracking may contribute to climate change or lead to tremors and other disturbances. Hollywood starlets, rock stars, and media moguls, including Yoko Ono, Sean Lennon, Alec Baldwin, Paul McCartney, and Scarlett Johansson, have become activists on the hot-button issue, which figures to dominate headlines for years to come. The Rolling Stones even wrote a song, “Doom and Gloom,” that disparages fracking.
Many of the environmental threats can be addressed or are overstated. But progress has been too slow, there have been damaging mishaps, and some say there’s too little regulation. While soaring natural gas production actually might help alleviate global warming by reducing demand for dirtier coal in places like China, the resurgence of fossil fuels threatens to sap interest in still cleaner alternative energy sources. The full impact of the new drilling may take years to be fully understood, and some companies continue to resist sharing full details of how they fracture rock to get all that oil and gas, adding to the unease.
* * *
The shifts that have taken place in the United States, and those on the way around the globe, are in many ways not nearly as astonishing as the story of how a small group of individuals made it all happen, against all odds. These modern-day wildcatters ignored the skepticism and derision of experts, major oil companies, and even colleagues to drill in rock they believed was packed with oil and gas miles beneath the earth’s surface. These men have altered the economic, environmental, and geopolitical course of the world while scoring some of the swiftest windfalls in history.
George Mitchell, who discovered a novel way to extract gas from shale formations, pocketed more than $2 billion. His impact eventually might even approach that of Henry Ford and Alexander Graham Bell. Aubrey McClendon and Tom Ward turned $50,000 into one of the nation’s largest natural gas producers, one that would control the mineral rights to fifteen million acres, around three times the area of New Jersey. Mark Papa built a $43 billion oil power from the discards of the disgraced Enron Corporation.
Another pioneer, Harold Hamm, amassed a fortune of more than $17 billion, making him one of America’s richest individuals. Hamm, who owns more oil in the ground than any American, has more wealth than Rupert Murdoch, Steven Cohen, Sumner Redstone, or even the estate of Steve Jobs. Hamm’s ongoing divorce likely will set a record for the costliest in history and could leave his wife with more money than Oprah Winfrey. Even Hamm’s right-hand man is worth as much as $400 million, a sign of the outsized profits racked up by innovators of the age.
Some of the architects of the “shale gale” were upended by a revolution they themselves helped create, however. They would see fortunes slip through their fingers and experience ridicule and scorn rather than wealth and admiration. And if the worst fears about the drilling are borne out, those at the forefront of the movement will be remembered for the damage they wrought rather than the blessings they bestowed.
But how did a few unlikely, ambitious, and headstrong wildcatters—some without college degrees or much background in geology or drilling—manage to tap massive energy deposits dismissed by the largest energy powers? ExxonMobil’s corporate headquarters are directly above a huge shale formation, but the oil giant disregarded the area, even as George Mitchell worked on coaxing historic amounts of gas from rock in the region.
Why did a new age of energy emerge from the depths of the Great Recession, even as Federal Reserve chairman Alan Greenspan warned of dwindling U.S. supplies, investors Warren Buffett and Henry Kravis bet on a dearth of natural gas, and Vladimir Putin predicted a Russian gas monopoly?
Why did private enterprise revitalize the nation’s energy outlook with a focus on fossil fuels, of all things, even as governments funneled $2 trillion toward cleaner, alternative energy? How did obscure energy entrepreneurs develop technologies to produce a surge of energy, even as a chorus of experts, including Peter Thiel, an original investor in Facebook, derided the country for no longer making dramatic technological advances? And why did it all happen in the United States and not in China, Russia, or other countries that boast their own enormous deposits of oil and gas in similar rock?
This book, based on over three hundred hours of interviews with more than fifty of the key players of the era, attempts to answer these questions. It also anticipates how the new age of energy might influence global financial markets, economies, military activities, and international politics. Government experts charged with developing energy policy were caught flat-footed by the dramatic recent shifts, as were environmental specialists and top oil-and-gas executives, suggesting that there is much to learn from those who managed to lead the shale revolution.
Those responsible for the remarkable period skirted danger every step of the way, risking their reputations and livelihoods for the discoveries of a century. Their saga unfolded in barren fields, in cluttered pickup trucks, and in high-pressure boardrooms. It’s one that will continue to impact the world for years to come.
The phone call came as a jolt.
It was May 2007 and Harold Hamm was enjoying dinner at the elegant Brown Palace Hotel and Spa in downtown Denver. To Hamm’s right were two longtime colleagues from his energy company, Continental Resources. A pair of Merrill Lynch investment bankers sat to Hamm’s left. The group was two-thirds through a grueling ten-day coast-to-coast trip aimed at wooing investors ahead of a crucial initial public offering of shares of Continental.
When rock bands go on road trips, the days are slow and the nights furious; when executives take to the road to sell pieces of their companies, the opposite usually is true. Hamm and the bankers had spent a full day convincing mutual fund honchos that Continental was set to strike it big in North Dakota, a long-overlooked part of the country. Now the group relaxed over dinner and drinks, their jackets off and ties loosened, as they discussed ways to improve their pitch.
As he’d courted the investors, Hamm hadn’t dwelled on the personal challenges he had overcome, such as growing up dirt poor in rural Lexington, Oklahoma, the youngest of thirteen children. He’d also avoided mention of his more recent turbulent love life.
Instead, Hamm shared an upbeat message about his company and a promising 15,000-square-mile formation of rocks called the Bakken under parts of North Dakota, Montana, and Canada. Hamm believed he was at the vanguard of a revolution that would deliver new oil and gas supplies to a nation running out of energy.
For all his big talk, though, Continental was producing just seven thousand barrels of oil a day from the Bakken’s dense rock. It was a mere trickle, representing a fraction of 1 percent of what ExxonMobil pumped on a daily basis. The results offered little proof that much more would flow from a region that had frustrated wildcatters for years, making Hamm’s pitch to investors challenging.
Still, the trip appeared to be on track, and the final leg—meetings with investors in Los Angeles—was just days away. The Merrill Lynch bankers told Hamm there seemed to be enough interest in Continental for the company to sell its sh...
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Descrizione libro Penguin Books Ltd, United Kingdom, 2014. Paperback. Condizione libro: New. Language: English . Brand New Book. The Frackers is the riveting, untold story of the tycoons behind the fracking controversy, from Gregory Zuckerman, the bestselling author of The Greatest Trade Ever. Remarkable .A great read, whether you are pro-fracking or against it Matthew Bishop, The Economist Smart, colourful, gripping Financial Times Excellent, highly readable The Times In 2006 the US was running out of energy. From running a city to turning on a lightbulb, the entire country depended on dwindling energy sources tied up in international politics. Then came the Frackers. Ambitious and headstrong, these few pioneers - some without degrees or backgrounds in geology - risked their livelihoods in the stubborn search under the soil. What they found transformed the nation, and the world. They tapped massive energy deposits that had always been overlooked. They solved America s dependence on imported energy and reshuffled international power. They triggered seismic environmental controversy and unleashed furious opposition. They made and lost astonishing fortunes. With exclusive access, award-winning Wall Street Journal reporter Gregory Zuckerman chronicles their untold story for the first time. From the barren fields of North Dakota to pickup trucks in Texas and boardrooms on Wall Street, The Frackers follows the men who spearheaded one of the greatest energy revolutions in history, and explores just how dangerous fracking really is. Codice libro della libreria APG9780670923687
Descrizione libro Penguin Books Ltd, United Kingdom, 2014. Paperback. Condizione libro: New. Language: English . Brand New Book. The Frackers is the riveting, untold story of the tycoons behind the fracking controversy, from Gregory Zuckerman, the bestselling author of The Greatest Trade Ever. Remarkable . A great read, whether you are pro-fracking or against it Matthew Bishop, The Economist Smart, colourful, gripping Financial Times Excellent, highly readable The Times In 2006 the US was running out of energy. From running a city to turning on a lightbulb, the entire country depended on dwindling energy sources tied up in international politics. Then came the Frackers. Ambitious and headstrong, these few pioneers - some without degrees or backgrounds in geology - risked their livelihoods in the stubborn search under the soil. What they found transformed the nation, and the world. They tapped massive energy deposits that had always been overlooked. They solved America s dependence on imported energy and reshuffled international power. They triggered seismic environmental controversy and unleashed furious opposition. They made and lost astonishing fortunes. With exclusive access, award-winning Wall Street Journal reporter Gregory Zuckerman chronicles their untold story for the first time. From the barren fields of North Dakota to pickup trucks in Texas and boardrooms on Wall Street, The Frackers follows the men who spearheaded one of the greatest energy revolutions in history, and explores just how dangerous fracking really is. Codice libro della libreria APG9780670923687
Descrizione libro Penguin Books Ltd 2014-10-02, London, 2014. paperback. Condizione libro: New. Codice libro della libreria 9780670923687
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Descrizione libro Portfolio Penguin, 2014. Paperback. Condizione libro: Brand New. 432 pages. In Stock. Codice libro della libreria __0670923680
Descrizione libro 2014. Paperback. Condizione libro: New. Paperback. 'The Frackers' is the riveting, untold story of the tycoons behind the fracking controversy, from Gregory Zuckerman, the bestselling author of The Greatest Trade Ever. 'Remarkable .A gr.Shipping may be from multiple locations in the US or from the UK, depending on stock availability. 432 pages. 0.316. Codice libro della libreria 9780670923687