George H. W. Bush: An oil and gas retrospective
On Nov. 30, 2018, the U.S oil and gas industry lost one of its legendary figures, when former U.S. President George H. W. Bush passed away in Houston, Texas, at age 94, Fig 1. Born in Milton, Mass., he served as the youngest U.S. naval aviator during World War II, married his wife, Barbara, in 1945, and graduated from Yale University in 1948, with a BA degree in economics. Before he amassed his fine record of public service over a 26-year period, Bush spent 18 years in the U.S. oil and gas industry.
EARLY O&G DAYS
From 1948 to 1951, George H. W. Bush built up his initial oil and gas experience in the equipment/service sector of the U.S. upstream industry.
Dresser Industries/IDECO. Founded in 1880, the Solomon R. Dresser Manufacturing Company (drilling and pipeline equipment) in 1928 went public through the issuance of stock and securities by W. A. Harriman and Company of New York. Bush’s father, Prescott Sheldon Bush, Sr. (who was a U.S. senator from Connecticut during 1952-1963), handled the reorganization for Harriman and became a company director in 1930. H. Neil Mallon, a longtime associate/friend of Prescott Bush, became the firm’s president and general manager.
Known officially, from 1944 forward, as Dresser Industries, the company grew and diversified throughout the 1940s and 1950s. During 1944, it acquired the International Derrick and Equipment Company (IDECO). Mallon gave George H. W. Bush a position with IDECO upon his graduation from Yale in 1948. Bush sold field equipment and supplies, working primarily out of Odessa, Texas, receiving $375.00/month. In 1949, Bush was transferred to Southern California, where he worked for other Dresser subsidiaries, including Pacific Pumps from September 1949 to January 1950.
Bush rejoined IDECO in January 1950 to work on the production line at the California Division in Torrance. He remained there until April, when he was moved to Midland, Texas, to work for the Supply Stores Division. He remained with IDECO for another year. (Dresser was acquired by the Halliburton Company in 1998.)
In 1951, Bush left IDECO, when he and John Overbey formed Bush-Overbey Oil Development Company, Inc., in partnership. With funds raised through his uncle, Herbie Walker, Bush and Overbey bought mineral rights and arranged for oil exploration in the Permian basin, Fig. 2. They operated for two years with modest success until 1953, when they went into business with brothers J. Hugh Liedtke and William Liedtke, law partners in Midland.
THE ZAPATA ERA
Incorporated on March 23, 1953, with a $1-million-plus capitalization, Zapata Petroleum Corporation was a partnership of George H. W. Bush, John Overbey, J. Hugh Liedtke and William Liedtke. Liedtke and Bush (Fig. 3) named the company after the film, Viva Zapata, then playing in Midland. Liedtke and Bush also liked that the company name began with a “z,” making it easier to find in the phone book.
The new company, financed in large part through G. H. Walker and Company, developed rapidly, acquiring Piedmont Oil Company in 1954. This purchase provided Zapata with a one-third interest in West Jameson field in Coke County, east of Midland. The field proved profitable; by the end of 1954, 71 wells had been completed. This number climbed to 122 in 1955, producing 2,200 bopd. The company expanded further, adding additional fields and diversifying.
Zapata Drilling Company was organized as a Zapata Petroleum subsidiary and began operations in 1954. Zapata Off-Shore Company was founded in October 1954, to capitalize on opportunities in the Gulf of Mexico. The company moved into its new headquarters in Midland, in 1956. That same year, leases in Ector County, Texas (near Odessa), began to produce, and the company eventually acquired full ownership. Also in 1956, Zapata acquired Westag Corporation, including producing properties in Brazoria, Matagorda and Hidalgo counties.
The company raised additional capex through a public stock offering on Dec. 30, 1955, and became listed on the American Stock Exchange on Dec. 14, 1956. Zapata Off-Shore, headed by George H. W. Bush, became an independent company in 1959. Liedtke remained head of Zapata Petroleum, eventually merging it with the Penn Oil Company in 1963 to form Pennzoil.
Zapata Off-Shore Company. Financed originally by Zapata Petroleum, Zapata Off-Shore raised additional operating capital through a public stock sale, with Bush serving as president. Working with R. G. LeTourneau, Inc., Zapata Off-Shore operated a new type of mobile drilling platform, known as jackups, Fig. 4. The first jackup, Scorpion, became operational in March 1956 off Galveston, Texas.
Zapata also remodeled and outfitted old freighters to serve as drilling tenders for offshore platforms. The first of these became operational in September 1955. Zapata Petroleum reduced its ownership stake in the company to 40% and eventually divested its remaining stock. Bush moved the headquarters to Houston, Texas, that same year, Fig. 5. The company continued to utilize new and emerging drilling technology. The older rigs were joined by newer mobile drilling units.
By 1965, plans were underway to construct additional rigs, as net income increased. Effective Feb. 7, 1966, Bush divested himself of Zapata Off-Shore Company assets, as he began his bid to run for Congress. The company was purchased by a group of investors, and over the next three decades, evolved into Zapata Corporation, a diversified multinational company in Houston.
Zapata-O. D. E. Limited. Zapata Off-Shore Company formed a business association with Oil Drilling and Exploration, Limited, in late 1965 and early 1966. The plan was finalized after Bush announced plans to sever his ties with Zapata. The joint venture would enable Zapata to capitalize on offshore drilling opportunities in Australia. G. G. Goddard, secretary-treasurer of Oil Drilling and Exploration, Limited, became general manager of the new subsidiary.
ADDITIONAL O&G SERVICE
Formed in 1946, Camco, Incorporated, was a Houston-based oil tool manufacturer, with one of its specialties being gas lift equipment. Bush served on the Camco board of directors from 1959 to at least 1963. The company owned several subsidiaries, and in 1962, the company completed a new factory in Houston, boasting gross sales of over $5 million. By 1964, sales approached $10 million.
Associations. During the 1950s and 1960s, Bush belonged to several industry associations. These include IPAA, American Association of Oil Well Drilling Contractors, and the Mid-Continent Oil & Gas Association, Texas Division.
After leaving Zapata, George H. W. Bush served as a Texas congressman (1967-1971); Ambassador to the U.N. (1971-1973); Chief to the U.S. Liaison Office in China (1974-1975); Director of the CIA (1976-1977); Vice President (1981-1989); and President (1989-1993). He and Barbara Bush were pivotal figures in Houston and Kennebunkport, Maine, for the remaining 25 years of their lives. They, along with daughter Robin, are buried at the George H. W. Bush Presidential Library Center, on the grounds of Texas A&M University in College Station, Texas.
Editor’s note: The author thanks the National Archives staff at the George H. W. Bush Presidential Library Center for their generous help in preparing this article.
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