Louisiana Mid-Continent Oil and Gas Association

History of the Industry

ABOUT 1868 — The Louisiana Oil and Coal Company drilled a well about 15 miles west of Lake Charles in search of oil but was unsuccessful although it did reveal very extensive sulfur deposits.

1870 — A night watchman at an ice plant in Shreveport accidentally discovered natural gas emanating from a well drilled in search of artesian water when he struck a match. Gas from the well was piped to the plant to provide illumination--the first use in the state of the fuel that today heats the vast majority of Louisiana homes and places of business.

Sept. 21, 1901 — The Heywood well six miles from Jennings was brought in, producing the first oil discovered in the state in commercial quantities and marking what is recognized as the birth of the industry in the state.

1906 — The Louisiana Legislature passed the first state oil and gas conservation law.

1908 — The first natural gas pipeline was laid in Louisiana. It brought gas from the Caddo Field to Shreveport.

1909 — The new refinery in Baton Rouge (which is the Exxon refinery of today) went on stream. Today it is, in terms of capacity, among the largest oil refineries on the North American continent. This is also the year in which construction began on Louisiana’s first long-distance oil pipeline, which by 1910 was transporting crude oil from Caddo Parish to the Baton Rouge refinery.

ABOUT 1910 — The first over-water drilling in America occurred on Caddo Lake near Shreveport.

1913 — A major discovery occurred in Northwest Louisiana when the Bull Bayou Field was brought in.

1916 — The well resulting in the discovery of the Monroe Gas Field was brought in.

1921 — The prolific Haynesville Gas Field was discovered.

1940 — The oil and gas industry came to Central Louisiana in a big way with the discovery of the Olla Field in LaSalle Parish.

1942 — The Lake St. John Field on the eastern border of Louisiana was discovered.

Nov. 14, 1947 — The first oil well out of sight of land was brought in by Kerr-McGee in the Gulf of Mexico about 45 miles south of Morgan City in the Ship Shoal Block 32 Field, marking the birth of the offshore oil and gas industry.

1948 — The Main Pass Field came in near the mouth of the Mississippi River.

1949 — Three major fields were discovered in the Gulf of Mexico off the Louisiana coast. They were the Eugene Island, BayMarchand and Vermillion Fields.

1950 — The South Pass Field in the Gulf of Mexico was discovered.

1954 — The western boundary of Louisiana’s offshore oil and gas industry was established with discovery of the West Cameron Field.

1959 — Severance taxes on oil and gas rose above the $100 million mark in Louisiana for the first time.

1969 — Louisiana oil production peaked at 728,494,272 barrels of crude and condensate and reserves began to decline.

1970 — Louisiana’s natural gas reserves dropped for the first time since gas was discovered in significant quantities in the state.

1973 — The offshore industry unveiled Clean Gulf Associates, a cooperative stockpiling of the most sophisticated oil spill containment and cleanup equipment available.

1975 — Gerald R. Ford became the first President of the United States to visit an offshore oil platform when he came to Louisiana on April 23. His comment: “We just have to get more and more of these.”

1982 — Lease and royalty income paid by the oil and gas industry to the state of Louisiana soared to an all-time record $624,529,812.

1982 — Oil and gas severance taxes in Louisiana hit an all-time record $971,677,140.

1986 — The Bay Marchand Field produced its 500,000,000th barrel of oil making it one of the greatest producers in the U.S.

1988 — Bullwinkle, the world’s tallest man-made offshore structure, was launched May 21, 1988 by Shell Offshore, Inc. Bullwinkle carried a $500 million price tag and is located approximately 150 miles south of New Orleans.

1989 — The first tension well leg platform was installed by Conoco in the Gulf of Mexico with production from the platform beginning November 8. The platform floats on the surface of the water and is connected to a foundation template on the sea floor by tubular steel tendons. The platform was placed in 1,760 feet of water, about 170 miles southwest of New Orleans in the Jolliet Field.

1990 — The Marine Spill Response Corporation was established by the petroleum industry as an oil spill response corporation. The group was created following the March 24, 1989 oil tanker spill in Alaska’s Prince William Sound. MSRC also announced in that same year that one of its five regional response centers would be located in Lake Charles.

1991 — The Louisiana Legislature enacted a law establishing an oil spill response program. The new law levied a two-cent per barrel fee on all oil transferred to or from a marine terminal in Louisiana.

1991 — The search for oil goes further offshore in the Gulf of Mexico. Shell Oil made a deepwater discovery in about 3,100 feet of water, about 130 miles southeast of New Orleans. BP Exploration held an interest in the project. A short time later a second deepwater discovery was announced by Exxon and its project partner Conoco.

1991 — The State of Louisiana filed suit in federal court in an effort to block an offshore lease sale. The suit was later dismissed.

1992 — Oklahoma adopts a natural gas proration statute. Louisiana holds public hearings on the issue, but does not adopt any statute or regulations

1993 — The Louisiana Legislature, with the support of the Louisiana oil and gas industry, adopts legislation aimed at addressing the issue of orphaned or abandoned wells. The legislation established a fee on all oil and gas produced in the state and provided for a method of establishing voluntary trust funds for each well that would follow the well each time it is sold and be available to cover the cost of properly closing and abandoning the well when it was no longer productive.

1993 — The Louisiana Mid-Continent Oil and Gas Association conducts the first of its kind study regarding the economic impacts of the offshore oil and gas industry. The study Impacts showed that the offshore industry has a positive economic impact on the state of more than $3 billion each year.

1994 — The Louisiana Legislature enacted a major package of incentive legislation. The new legislation provides for the suspension of severance taxes for the re-entering of plugged wells, wells deeper than 15,000 feet, horizontal wells and wildcat wells. Oil and gas activity increased sharply after passage of the incentive legislation.

1996 — After more than a decade of depressed prices and activity, the oil and gas industry began to see a rebound. New drilling activity in the Gulf of Mexico spurred on by the development of new technology and the overall worldwide demand for oil gave a new push to Louisiana oil and gas production.

1997 — Record-breaking lease sale in the Gulf of Mexico. Nearly $1 billion exposed as bids by companies seeking to drill in the Gulf of Mexico, proving that the Gulf of Mexico is not a “dead sea.”

1997 — Louisiana prepares to celebrate the 50th anniversary of offshore oil and gas exploration and production. The Louisiana Mid-Continent Oil and Gas Association celebrates its 75th anniversary as a trade association and pays tribute to the industry’s “Remarkable Past and its Exciting Future.”

1998 — Oil prices took a sharp decline in the first part of the year and remained depressed for most of the year.

1998 — A new round of mergers began. BP purchased Amoco, Kerr-McGee purchased Oryx. Exxon and Mobil agreed to a merger that formed the largest company in the United States. Other companies combined downstream operations. New rounds of employee layoffs and consolidations also began.

1999 — OPEC agrees to a new era of production cuts causing oil prices to increase.

Oct. 16, 2000—Chevron and Texaco agreed to merge and become ChevronTexaco, with the name later reverting back to Chevron.

Sept. 15, 2004—Hurricane Ivan made its way through the Gulf of Mexico causing extensive damage to the underwater oil and gas infrastructure.

Aug. 29, 2005—Hurricane Katrina cut a destructive path through the Gulf of Mexico and came ashore causing catastrophic damage in Louisiana the Gulf Coast. Katrina turned out to be the most destructive natural disaster in United States history. The hurricane curtailed almost all oil and gas production in the Gulf of Mexico and south Louisiana. Many gas processing plants were damaged while several refineries were flooded with the damage to the state infrastructure hindering repairs.

Sept. 24, 2005—Less than one month after Katrina, Hurricane Rita came ashore in Louisiana, causing damage all across the southern part of the state with extensive damage in the southwest corner. Rita followed a path similar to Katrina through the Gulf of Mexico before making landfall. The combined path of the two hurricanes that were less than 30 days apart was perhaps the most destructive course that the storms could have taken in regards to offshore oil and gas activities.

Nov. 7, 2006—Marathon approved a major expansion of its Garyville, LA refinery. The expansion will add 180,000 barrels of capacity and cost more than $3 billion. The Garyville refinery was the last refinery built in the United States more than 30 years earlier.

July 13, 2007—The Louisiana Mineral Board reported that state income from oil and gas royalties had hit an all-time high with collections of $522.5 million.

January 2008—For the first time, crude oil price broke $100 per barrel and gasoline prices broke $4.00 per gallon.

2008—Another brutal Hurricane Season wreaks havoc on Louisiana’s oil and gas industry as Hurricane’s Gustav and Ike hit the Gulf Coast within weeks of each other.

2010—An explosion occurred on the Deepwater Horizon oil rig working on the Macondo exploration well for BP in the Gulf of Mexico leaking oil into the Gulf of Mexico for 87 days before the well was closed and sealed. Shortly after the event, a six-month moratorium on all deep-water offshore drilling on the Outer Continental Shelf was declared by U.S. Secretary of the Interior Ken Salazar, forever changing the landscape of the industry for Louisiana and the Gulf Coast.

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