Oil and Gas PEGS Cards

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1 Oil and Gas PEGS Cards Grade 07 Social Studies Unit: 10 Lesson: Oil - Texas Gold Oil consists of decayed plants and animals that lived hundreds of millions of years ago. Over the years, their remains were covered by layers of mud. Heat and pressure from these layers helped the remains turn into what we call crude oil. The word "petroleum" means "rock oil" or "oil from the earth." The first large oil field in Texas was found at Spindletop in Since then, oil has become a major industry in Texas. Over the years, it has boomed and busted but today Texas is the largest producer of oil and gas in the United States. It affects the Texas economy in regards to jobs, personal income, and the population of the state. 2. Spindletop January 10, 1901, Patillo Higgins and Captain Anthony Lucas struck a gusher oil well outside Beaumont. The well flowed nonstop for nine days. One hundred thousand barrels of oil flowed per day until the well was capped. The Spindletop Oil Field in 1901 produced more than four times the amount of oil Texas had produced the year before creating a new and booming industry. Most importantly, Spindletop encouraged oil drilling in other locations in Texas, which encouraged the creation of new oil companies, and most importantly, new jobs. As the Texas economy improved during this Age of Oil, more people moved to the state to take advantage of the opportunities the oil and gas industry offered. 3. Oil in Beaumont Spindletop changed Beaumont overnight. Within three months, oil speculators, drillers, and businesses that could make money in this new industry descended upon the city. The population increased from 9,000 to 50,000 citizens. Oil companies were created, such as Texaco and Humble Oil, as well as other companies that supplied oil refineries, pipelines, ocean tankers, and storage facilities. 4. The Oil Industry in Houston Due to the oil and gas industry, Texas large cities were quickly becoming more urbanized as sites for industry as well as agriculture. Houston is a city that reaped the long-term benefits of the oil industry. As oil fields emerged around Texas, Houston became the center of oil business activities. Houston was a major city in Texas that had a well-developed rail network, banking, insurance industry, legal services, and most importantly, the Houston Ship Channel. The Houston Ship Channel allowed tankers from all over the world to transport goods, services, and oil to the entire United States and the world beyond. 2012, TESCCC 05/21/13 page 1 of 6

2 Oil and Gas PEGS Cards 5. THE TIDELANDS In the early 1950s, new technology had allowed Texas oil companies to drill the tideland areas off the coast of Texas. Tidelands are areas under the ocean and near the shore, but they are not exposed in low tides. The federal government claimed that Texas sovereignty (right to rule) stopped at 3 miles off the coast of Texas. Texas claimed it was 10.5 miles which included the tidelands. Governor Shivers, a Democrat, said he would the support the 1952 Republican Presidential candidate, Dwight D. Eisenhower if he signed a bill giving the tidelands to Texas. He agreed and soon after he was elected President of the United States. Texas was able to claim the tidelands, and a portion of the money earned from the drilling of oil in the tidelands went to support Texas schools. 6. WILDCATTERS A wildcatter is an oil operator who drills for wells in territory not known to contain oil. In the early days of the oil industry, wildcatters were instrumental in drilling in areas that were risky. Columbus Dad Joiner was a wildcatter in the 1930s. He was convinced there were oil deposits in Rusk County. After two unsuccessful attempts, he finally struck oil. This oil field was the largest oil field in the world at the time. As father of the field, Joiner was nicknamed Dad and the city of Joinerville was named in his honor. Other well-known wildcatters were Glenn McCarthy of Houston who was known as the King of the Wildcatters, Sid Richardson of Ft. Worth, and H.L. Hunt of Dallas. These men donated much of their wealth to educational institutions and the cities in which they lived. 7. TEXAS RAILROAD COMMISSION By 1917, Texas was the largest producer of oil in the United States, but there were challenges. Oil continued to be drilled even when there was not a demand for it, and prices began to drop due to a larger supply than what was demanded in the market. The state of Texas believed that the industry needed to be regulated. This did not stop independent producers from drilling oil and smuggling it out of the state illegally. It prompted Governor Ross Sterling to declare martial law in four East Texas counties for six months to limit waste and control production.. By 1935 the industry was stabilized. Today the Texas Railroad Commission helps set oil prices and it regulates coal, uranium, and oil production. 8. WORLD WAR I and World War II World War I and II were dependent on tanks, ships, airplanes, gasoline, explosives, and other necessary supplies and equipment, many of which required oil-based fuel. During World War II, Texas provided 80 percent of the oil needed to fight the war. This contributed to an increase in Texas population, especially in the industrialized areas between the Brazos River and the Sabine River. It also encouraged the development of new products dependent on the oil industry, like synthetic rubber and fan belts..

3 Oil and Gas PEGS Cards Grade 07 Social Studies Unit: 10 Lesson: Scientific Discoveries Howard Hughes, Sr. was a lawyer and entrepreneur. After Spindletop, he went to Texas to be a part of the oil business, and made his home in Houston. Around 1906, Hughes became interested in finding a solution to the problem of drilling through hard rock formation. In 1908, he and his business partner Walter Sharp started a company to solve this problem. Their company invented and manufactured a rotary bit which could drill through hard rock. This invention saved time and money for drilling services and made Howard Hughes and his family very wealthy. Scientific discoveries continued to impact the oil industry with further advancements in not only rotary drill bits, but later directional bits that could accomplish nonvertical drilling and deep sea drilling innovations. 11. The Organization of Petroleum Exporting Countries (OPEC) In 1960, the major oil-exporting nations of the world formed OPEC. It was organized to control the price of oil in world markets by agreeing to reduce production jointly. The United States was not a member of this organization (and is still not). Then, in 1973, in response to political tension in the Middle East, the Arab members of OPEC placed an embargo on oil shipped to the United States. Texas oil was in great demand and the price of crude oil from Texas tripled. New companies started up, there were many more jobs, and the Texas government had enough revenue to put more funding into education and other public services. 10. EXXON The Exxon Oil Company is an international oil company with headquarters in Texas. It was originally chartered in 1911 in Humble, Texas and was known as Humble Oil. It had a great impact on the economy of Texas by supplying the United States and Europe with oil during World War II and continuing through present day. Exxon has provided jobs and other businesses associated with the oil industry. In 1972, Humble became known as Exxon and it began expanding its products, research, exploration, and services. In March of 1989, an Exxon tanker caused one the worst environmental accidents in history. The Exxon Valdez ran aground and spilled almost a quarter of a million barrels of oil off the coast of Alaska. Exxon organized a billion dollar clean-up and since then has worked at preventing other accidents. Unfortunately, along with the benefits of oil exploration and development, there can be negative environmental consequences such as oil spills that harm wildlife and disrupt natural habitats. 12. NEW LONDON GAS EXPLOSION There were major safety concerns from people living near oil wells or refineries. On March 18, 1937, one of the most tragic accidents occurred concerning the drilling of natural gas. At 3:05 p.m., a massive natural gas explosion ripped through a school building in New London, a small town in East Texas. The blast lifted the school off its foundation. The entire structure collapsed killing 298 people, including students and teachers. Since that time, natural gas which is odorless, must include a mixture that gives it an odor so it can be detected if there is a leak. Laws and policies were passed by the Railroad Commission to prevent waste concerning pipelines and new markets, which has made the industry safer. 2012, TESCCC 05/21/13 page 3 of 6

4 Oil and Gad PEGS Cards 13. DEPENDENT INDUSTRIES At the turn of the 20 th century, the demand for oil was not great, but as time went on new industries became quite dependent on the oil industry. One of the first industries to demonstrate this dependency was the lumber business. Early oil derricks were made from lumber as well as the houses and stores that were needed by citizens of the new boom towns. Oil and gas was an essential component of the automobile industry and still is today. After World War II, oil became a major ingredient for everyday supplies such as aspirin, candles, carpet, crayons, dyes, detergents, hand lotion, nail polish, pantyhose, shampoo, toothpaste, and anything made of plastics. Today, Texas is one of the largest producers of oil and gas in the United States. 15. TEXAS CRASH OF THE 1980s The Organization of Petroleum Exporting Countries (OPEC) boycott was the cause of the increase of oil production in Texas in the 1970s, but between 1983 and 1986, the industry was in financial trouble. By 1981, the U.S. began buying oil from OPEC countries again. The demand for oil decreased and prices dropped sharply. Thousands of people lost their jobs, and businesses and banks collapsed. The entire economy of Texas was in a slump and the Texas government had to raise taxes to pay for education and other public services. This represents a bust time in Texas oil history of boom or bust! 14. RED ADAIR Paul Red Adair was born and raised in Houston, Texas. He is known as the most famous firefighter in the world for his expertise in putting out oil well fires and controlling well blowouts. His experience detonating bombs during World War II and his work in the oilfields gave him the experience to start the Red Adair Company, Inc. which put out oil well fires and blowouts. In 1962, he gained international fame when he led a team that put out a fire in the Sahara Desert that had been burning for six months. After the Gulf War in 1991, he participated in controlling the oil well fires in Kuwait set by Saddam Hussein s retreating army. Adair died in 2004, but his company still continues to put out oil well fires even today. 16. Major Cities in Texas During World War II, people began leaving their small towns and farming communities and moved to cities to work in the factories and businesses that supported the war efforts, including working in the oil industry. Many stayed after the war ended due to the economic and employment opportunities big business and industry offered in the cities. The following cities now have major political, economic, and cultural impact on Texas: Dallas, Fort Worth, Houston, Austin, and San Antonio. Can you locate these cities on the map below?.

5 Grade 07 Social Studies Unit: 10 Lesson: Adapting to the Environment Texans have adapted to their environment with both positive and negative consequences. Railroad tracks were built across Texas in the late 19 th century, which allowed a way for people and products to be connected more quickly and efficiently. Another way Texans living in Galveston adapted after the Hurricane of 1900, is by building a seawall and increased the elevation of the city to avoid this type of catastrophe and flooding in the future. In addition, the Houston ship channel was built in 1914, to connect Houston to the Gulf of Mexico to increase productivity and the ability to ship Texas products to the world, such as crude oil. However, this contributes to possible pollution, industrial accidents, and oil spills. 18. The Urbanization of Texas Texas went from a state of wide open plains and an unexplored frontier to a state filled with towns, cities, and many industries. There were a variety of economic factors that led to this urbanization of Texas. Oil and gas exploration, agriculture, farming, and ranching brought people to Texas in hopes of economic opportunities. Technological advancements in each of these areas caused an even greater lure to the state as an improved standard of living was the prize for being a Texan. Advancements in transportation such as the expansion of the railroad, new roads and highways, and the increase in people owning automobiles helped Texas move from frontier to a modern state filled with opportunities. 19. Oil and Gas Industry Time Line Oil and Gas industry 19 th century, oil was found, but there was little demand for it Melrose Petroleum Oil Company drilled the 1 st successful oil well in Texas 1894 Oil found in Corsicana Turn of the Century transportation advancements with engines increases demand for oil January 10, 1901 Spindletop gusher in Beaumont 20. Manufacturing Industry in Texas At the turn of the century, Texas had a small manufacturing industry that provided only what was needed in the Texas community in which they lived. Most of the jobs in the 19 th century revolved around agriculture and cattle ranching. However, after World War I and World War II, Texas became a major player in manufacturing products such as oil, gas, agricultural resources such as cotton and grain, and cattle and sheep. In conjunction with these big industries, people began flooding to the state and populating the larger cities. Service jobs increased in the cities due to more people living in these urban areas. 1920s New oil fields were found in east and west Texas 20 th Century Texas becomes world s leading producer 2012, TESCCC 05/21/13 page 5 of 6

The Industrialization of the United States s 1910 s

The Industrialization of the United States 1860 s 1910 s The South Builds Railways O After the Civil War, the South began building more railroads to rival those of the North. O South now relied on its