Friday, September 01, 2006
(Topic: Petroleum Archives) Notes for an address by Peter McKenzie-Brown Author of The Richness of Discovery: Amoco’s First 50 Years in Canada (1948-1998) When I wrote The Richness of Discovery — a history of Amoco Canada — my research helped uncover two documents that I believe are of considerable historical significance. Both were type-written, both are rare. My presentation today will deal primarily with these two documents. British geologist Dr. T.O. Boswell prep a red one of these documents — titled “Report on the Prospect of Obtaining Oil in the Region of the Mackenzie River, Great Slave Lake, Slave River & Athabasca River” — in 1914. It had been commissioned by two Calgary businessmen, F.C. Lowes and J.K. Cornwall, who wanted to investigate the petroleum potential of northern Alberta and beyond. I already knew about this report and how it led to Imperial Oil’s discovery in 1920 of the Norman Wells oil field. I had found re f e rences to it in the literature, and I knew that an original copy lay somewhere in Imperial’s or Exxon’s vaults. I never thought I would actually help discover an original copy however, and I was therefore quite excited to find one in Amoco’s files. Since the Amoco copy of this 69-page document appears to have been typed, it is clearly a rare find. That said, however, I should note that Amoco’s copy does not include illustrations, photographs or maps showing the location of Bosworth’s claims. Those attachments may have simply been lost over time. Another possibility is that Amoco’s text was not the main copy — the one promoters Lowes and Cornwall used when approaching oil companies to drill the lands Bosworth had staked. Amoco’s copy probably reached A moco Corporation just before US involvement in World War I. As I will suggest in the balance of my presentation today, the Bosworth document was one of the pivotal documents for Canada’s petroleum industry. Bosworth the pioneer has never fully received his due. So important was his obscure 1914 report, in fact, that without it the Canadian petroleum industry would be quite different today. Certainly, A moco would not be celebrating a 50th anniversary in Canada. Before I develop that notion, however, I want to quickly cover the second significant document I found in the course of my book-writing research. The John Bartram document did not change the flow of history. However, it is the first record of an Amoco assessment of western Canada’s potential. It gives an intelligent contemporary analysis of the Turner Valley oil field, and offers excellent insights into the need for oil and gas geologists to constantly rethink their geological ideas. The document originated after the Midwest Refining Company, an A moco subsidiary, asked Bartram to report on Canada’s oil prospects. While the Turner Valley field had been on production since 1914, a second boom at the field began in the mid-1920s, after deeper drilling led to the discovery of the field’s condensate-rich gas cap. Amoco sent Bartram, an employee, to Calgary in response to this Turner Valley boom. Bartram’s report was dated 1927. In his commentary he notes that The big gasoline well (Royalite #4) came in late in 1924 at a depth of 3750 feet, and in less than two years has marketed 11,064,000 Imperial gallons of 72 gravity gasoline and a production of about 20,000,000 cubic feet of gas a day....It is a very valuable property. Bartram recommended that the Amoco subsidiary undertake a careful study of Alberta’s potential. In particular, he suggested that oilmen needed to look at local geology from a different perspective. Perhaps, he seemed to be suggesting, the known geology of the Turner Valley field was blindsiding people to riches that may exist in other geological structures. “We know from our own experience,” he said, “that the geologists and also the officials of a company that operates in one area for a long time, tend to think along the same lines and to accept the same theories of oil occurrence. When other groups of men invade the same territory, the newcomers work with different methods, use different theories and drill structures the others condemned.” In fact, Bartram was exactly right, as I will discuss later in this presentation. His report is quite short — just a few pages long. However, there is a scarcity of oil industry intelligence from this era. In addition, Bartram offers excellent insights into the need for petroleum geologists to continually look at rock structures with fresh eyes, and to think about formations with clear minds. For both these reasons, I believe this document is significant. Before Bartram’s recommendations to Amoco could be implemented, oil prices began to decline as new discoveries in the US mid-continent came on stream. Then came the Depression, followed by World War II. While Bartram’s ideas were prescient, it would be two decades before Amoco actually made the move to Alberta. In a sense, Bartram’s reminder that geologists use ideas to find oil is the key notion for this paper. I want to demonstrate from the perspective of history how Bosworth’s ideas helped unlock Alberta’s crude oil riches. Bosworth’s own words suggest what an ambitious expedition his was. “The undertaking was planned in March 1914,” he says. In April I consulted with the officers of the Government Geological Survey and other Departments in Ottawa and gathere d f rom them all available information; maps and literature bearing on the subject. At the beginning of May I journeyed from London to Canada accompanied by three assistant geologists and surveyors, and on May 19th, the expedition set out f rom Edmonton to travel northwards in the guidance of the Northern Trading Company. We returned to Edmonton September 24th. Bosworth does not remark on coming of World War I. When he left the world was at peace; when he returned, Europe and the British Empire had become embroiled in a terrible war. He was probably totally unaware of those developments while in the north. The Bosworth expedition covered huge distances in less than five months. In the end, he reported that there were excellent prospects of obtaining oil in three general regions: “The Mackenzie River between Old Fort Good Hope and Fort Norman; the Tar Springs District on the Great Slave Lake; and in the Tar Sand District on the Athabasca River. ” His report offers concise, well-written geological descriptions of rocks, formations and structures his group encountered. It also includes chemical reports on oil from seepages. I will not cover much of the technical information in this presentation . However, the following passages, which give some of the technical flavour of the report, have quite an important historical significance. Near Old Fort Good Hope (lat. 67 30’) in the banks of a tributary stream, the shales are well exposed....From the fossils it is evident that the shales are of Upper Paleozoic Age and probably belong to the Upper Devonian. Beneath the black shales lie the bituminous limestones. These are rather thinly bedded limestones of loose texture with thin shaley partings. The limestone is highly bituminous and smells very strongly, especially where freshly broken. It weathers a dark colour. Where it passes under water, bubbles of gas arise. The limestone is frequently largely composed of alveolites — a coral like fossil. In the upper part of the limestone other fossils are scarce. Lower down occur Devonian corals, Orthis, Atrypa, etc.... This remarkable series of Bituminous Shales and Limestones, of such thickness and of such richness contains the material from which a vast amount of petroleum might be generated and might pass into an overlying porous rock. It is admirable as an oil generating formation. [Bosworth’s emphasis.] In the section of the paper immediately following, Bosworth discusses whether there is evidence nearby of good reservoir rock. He concludes that there is, describing one nearby occurrence of “gray clay shales and shaley sandstone,” and another of “greenish shaley sandstone containing occasional fossils — corals, chenetes and rhynconella.” Both of the reservoir rocks Bosworth speculates upon lie above the Devonian shales. He seems to have been looking specifically for “overlying porous rock” to form the reservoir. It does not seem to have occurred to him that reefs within the shales could have served as reservoirs, even though he specifically noted the presence of Devonian corals. Technically very strong for its day, Bosworth’s report led to the discovery of the great Norman Wells oil field just after the First World War. The drilling expedition was led by Imperial Oil’s legendary exploration geologist, Ted Link. By scow and riverboat, he and his crew followed Bosworth’s route north to the Fort Norman area, just south of the arctic circle. They had taken with them the wherewithal to assemble a cable tool drilling rig, and they soon set to work. It is worth noting that a valuable member of the party was an ox named Old Nig. He supplied heavy labour during the summer, and he supplied steaks as freeze-up began killing off the forage. Link’s crew found oil in 1920, but there was no practical way to get it to major markets. Imperial constructed a tiny refinery nearby and used the products to supply missions, mines and other local customers in the 1920s and 30s. The company did not understand the reservoir it was producing from. Because Northwest Territories markets were quite marginal, Imperial had no reason to do much work on the field. That changed after Pearl Harbor. When the Americans became involved in World War II in 1942, they were extremely concerned about supplying oil to their Pacific Fleet. They therefore worked with Canada to develop the Norman Wells field. While Imperial drilled up the field, crews built a 1000 - kilometre oil pipeline over the Mackenzie Mountains to a newly constructed refinery in Whitehorse. The pipeline was built over some of the most difficult terrain in the country, and much of the work had to be done in the bitter cold of a northern winter. From that refinery, pipelines for diesel and gasoline led to a fuelling station in Skagway, Alaska. This project was known as the Canol Project — a name derived from the contraction of Canadian and oil. By almost any standard, the Canol Project’s wartime pipelines were terrible. Long sections were laid on the surface of the g round, and they leaked both oil and refined products. Neither pipelines nor refinery contributed meaningfully to the war effort. The first oil flowed to the refinery in 1944, but the refinery operated for barely a month before being mothballed. The threat to west coast shipping had largely disappeared. Nonetheless, the Canol Project had a huge impact on oil development in western Canada. While Imperial was drilling up the Norman Wells field, the company learned that the field’s reservoir was not the greenish shaley sandstone hypothesized by Bosworth. In fact, it was a Devonian re e f . Armed with this knowledge, Imperial’s geologists rethought their approach to western Canada. This is in fact a classic case of the dictum Amoco’s Bartram articulated in 1927: “When other groups of men invade [a] territory [that has been developed by other oilmen,] the newcomers work with different methods, use different theories and drill structures the others condemned.” Imperial returned to western Canada and, experimenting with primitive seismic technology, began to look for Devonian reefs. After having drilled a legendary 133 consecutive dry holes, in February 1947 the company brought in Leduc #1. That well ushered in the Canadian petroleum industry’s modern era. While Imperial deserves full marks for detective work on Devonian reefs, the company apparently made a very serious error. I understand that Imperial’s geologists mapped the Leduc reefs at a 90 angle to their actual orientation. When Texaco mapped the reefs correctly, that company came to have a dominant position on the Leduc chain. If this story is true, it demonstrates once again that oil is found in the mind. Of course, Imperial had already proved that dictum by solving the critical problem of Devonian reefs. And they did so with new geological theories. By contrast, other petroleum geologists were more or less convinced that big plays in Alberta would look, walk and feel like Turner Valley. They would be roughly 340 million years old, and they would be thrusted anticlines of Paleozoic age in a Mississippian age formation. A great deal of fruitless drilling had been going on in the foothills for years in search of that kind of play. What would later become quite clear was that Turner Valley — the first really big oil field in Canada — was an anomaly. Others like it probably don’t exist. While Bosworth was technically wrong in some important areas, his work gradually led to Imperial’s realization that Devonian reefs might be an important key to petroleum wealth for Canada. That change in thinking paved the way for a series of great discoveries. Leduc, of course, is precisely whatbrought Amoco to Canada. Oilmen around the world soon became aware of this important new discovery. And they began to bring expertise and investment into the province. They created one of the first great post-war oil booms, and laid the foundation for one of the world’s most technically advanced petroleum industries. In the euphoria that followed Leduc, Amoco was one of the first big players to arrive. The company did its initial intelligence work seven months after the discovery, and set up a fully fledged exploration operation within a year of Leduc’s first production. So I would like to suggest to you that Amoco is celebrating its 50th anniversary in Canada because of the Bosworth paper lying dormant in the company’s own files. There is a wonderful historical irony in that. If not for the Bosworth report, Canada’s petroleum industry would have had quite a different history. Enormously frustrated with its long unbroken string of dry holes at the time, Imperial planned the program that yielded Leduc as its last major wildcat play in Alberta. If not for Leduc, it is easy to imagine Alberta’s Devonian oil fields lying u n discovered until well into the 1950s. Of course, Imperial did discover Leduc. Amoco did formally arrive in Canada in 1948. And these two events gave me the good fortune to write a history of Amoco Canada’s first half century in Canada. The Richness of Discovery is available through the distributor, Detselig Enterprises (403) 283-0900. A few years ago I developed a notion in The Great Oil Age — a history of the Canadian petroleum industry that I co-authored — that I would like to share with you today. In the introduction to that book, I noted that Canada’s petroleum industry was the most diverse in the world, and suggested that no national industry on the planet is more technically sophisticated. In a sense, the Amoco history develops that theme. The Richness of Discovery use the Amoco experience to help explain some of the ways in which Canada created a remarkable, complex, world-leading industry. It also illustrates in often concrete ways how Amoco, Dome, Hudson’s Bay Oil and Gas and CANMAR touched the lives of their employees. It offers detail on how these great companies contributed to the business and economic life of western Canada. In today’s presentation I focused on the two significant historical documents that came out of my research. I hope my remarks today have convinced you of Bosworth’s unsung importance, because Amoco has agreed that I should use this opportunity to present his paper and the Bartram report to the Glenbow Institute. Those documents need to be professionally preserved, and they need to be available to scholars. On Amoco’s behalf, Colin Yeo will present them to the Glenbow. It was actually Colin — who is a geologist and also a serious history buff — who found them in the files, so it is entirely appropriate for him to make the formal presentation.