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The Nation | COLUMN ONE

Stalking the Wily Wildcat

Tennessee isn't Texas, but that doesn't stop inveterate dreamers and schemers from staking a claim to oil wealth, even if it's 10 barrels at a time.

September 01, 2004|Ellen Barry | Times Staff Writer

LIVINGSTON, Tenn. — Anthony Young smiles as he watches the Lucy Newberry No. 9 spit out a plume of oil. The woods are full of the smell of fresh crude, fruity and toasty at the same time, and an air compressor emits an unholy clanking while crewmen perch on overturned buckets, squinting at the orange stream.

The well isn't exactly a Texas-style gusher, but with oil prices near historic highs, it doesn't have to be. Young -- a hairdresser in rural Kentucky before he got hooked on chasing oil -- is feeling flush.

Since the 1860s, prospectors like Young have been taking their chances in the Appalachian foothills, fighting their way down through knots of rock. Tennessee's oilmen have heard the "Beverly Hillbillies" jokes, the comic visions of dowsers with divining rods scrambling up backwoods hollers. The only way to make a million dollars in the Tennessee oil fields, the jokers used to say, was by starting out with $3 million.

But this summer, as the price of a barrel of oil flirted with the milestone $50, independent prospectors all over the United States were drawn into the hunt. If prices remain high, interest will gradually increase in oddball oil states such as Tennessee and Missouri, Virginia and New York. These are places where small-time prospectors coax oil out of the ground at the rate of 10 barrels a day or less -- and where virtually anyone can be an independent prospector.

"A shoe salesman could come in here and get into the drilling business. That attracts people," said Bill Goodwin, president of the Tennessee Oil and Gas Assn.

There are good reasons major oil companies have steered clear of Tennessee. About 215 million years ago, under the heat and pressure of a continental collision, the rocks in northern Tennessee began to bend. When they broke -- in a series of long, jagged, parallel lines -- oil and gas migrated from deep in the earth into cracks and folds in the rocks. Prospectors in Tennessee spend lifetimes tracing the patterns of ancient breakage; they call it "chasing fractures."

If there is a reliable scientific way of predicting where oil will be in this terrain, no one has discovered it, said state geologist Ronald Zurawski. Drilling is shallow and cheap here, compared with Texas or Oklahoma, but the biggest discoveries have topped out at 1,000 barrels a day, a payoff too small to attract large companies. Using a vast array of predictive techniques, independent prospectors strike oil about 20% of the time -- roughly the same rate of success as completely random drilling, Zurawski said.

As a result, the oil business here has retained a frontier quality. In Tennessee, it's not unusual to hear of oil wells drilled on the advice of dowsers or dream interpreters; every year, a Texan television repairman shows up to search for oil with a tool that resembles a copper bicycle handle with a car antenna on one end and a spring on the other. A 78-year-old Baptist preacher approached a Helenwood driller this spring with specific instructions from God.

"The Lord woke me up," said Herman Faddis, now a leaseholder in a new drilling operation, Divine Energy LLC. "He spoke to me in a small, still voice, and said, 'I want to send you to talk to these oil people.' "

For Young, the path to Tennessee began 20 years ago, when he became intoxicated by the hunt for oil. Then a hairdresser in his native Knob Lick, Ky., he had begun to slip out of the salon during his lunch hours to a nearby field, where he would watch a drilling operation. On those breaks, Young caught sight of his first real oilman -- he wore a big cowboy hat, shiny belt buckle and snakeskin belt -- and thought, "Man, that's me right there."

Times were bad in oil then -- he knew that. As president and sole employee of Young Oil Corp., he printed up a set of particularly showy business cards: squares of shiny, solid gold, embossed with an oil well and a toll-free number.

"I knew I might not be able to stay in this business, but I thought, at least they'll remember the gold business card," Young said.

Oil prospectors are deal-makers. First, they settle on a prospect -- some patch of ground that has been overlooked or underestimated. Then, they secure a lease from the landowners, who receive a 12.5% stake in revenue from oil or gas found. After that, they set about finding an investor or a partner to share the drilling costs. Finally, they serve as contractors to oversee the drilling.

Young does this work while spinning down back roads in the cab of his truck, wearing jeans, a gold pump-jack pendant and a $1,000 pair of ostrich-skin cowboy boots (he has nine pairs). At 44, he has a puff of blond hair, blue eyes and a neat goatee. His accent makes "business" into "bidness"; for fun, he competes in truck pulls.

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