oil related 121107

The first oil strike in Saudi

David Ebner, today at 6:54 AM EST

DHAHRAN, SAUDI ARABIA— This crude capital on the Persian Gulf is home to the Kingdom's first commercial oil well, which gushed light Arabian oil in early 1938. The story of its discovery, I smiled upon learning, is not entirely dissimilar to the hunt for oil in Alberta decades ago—though the search in Western Canada took a lot more swings. Leduc No. 1, near Edmonton, produced a gusher in 1947, launching the province's modern energy business, but it was a last-gasp exploration effort after more than a hundred wells drilled by Imperial Oil Ltd. that came up with nothing.

In the Kingdom, Standard Oil Co. of California (now Chevron Corp.) signed the first foreign exploration concession with the just-formed Saudi Arabian state in late May 1933 in Jeddah on the Red Sea. Two years later, drilling was underway on the other side of the Arabian Peninsula. Damman No. 1 hit some oil, described as modest in historical accounts. The second effort was a bigger hit, sparking excitement—but it faded fast as the next four wells produced less and less encouraging results, all of them aimed at shallow targets of roughly 700 metres.

Damman No. 7 was spudded in December, 1936 with little enthusiasm. Drilling proceeded slowly and in early 1938 American oil executives in California recalled engineer Fred Davies and the chief geologist from Saudi Arabia to explain why the hunt for oil in the desert still made sense. While the boys were back home, drilling at Damman No. 7 continued, grinding deeper, well past 1,000 metres—and a gusher burst forth in March. Mr. Davies went on to become chairman of Aramco, the Saudi oil company, retiring in the late 1950s.

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