by Juan Puente Jr.
A note of thanks to Noel Atzmiller for recommending this informative, yet important book that was rated best in show at the 2010 STC Conference.
The start of Baker Atlas was both challenging and difficult at times. The primary challenge that seemed to keep Bill Lane and Walt Wells from starting a business was technology. The difficulties were numerous, and included many downturns in the oil business. Bill Lane and Walt Wells worked long hours at a time, establishing their perforating gun business. Baker Atlas’s history spans many years and involves many challenges throughout the journey.
Bill Lane’s and Walt Wells’ personas were as opposite as dry and wet. This did not stop them from working together to design tools that would better help the oil industry during the time of the Great Depression. It was a period of high drilling costs, and the demand for oil was on the rise. Making this scenario worse was the fact that the cost of oil was relatively low.
Lane and Wells figured a high-powered gun breaking through the casing, cement, and into oil-well formations, would reveal oil pockets from the cased in oil wells. An oilfield worker, Sidney Mims, previously patented a similar technical tool for this purpose, but could not get it to properly work for his needs. Lane and Wells purchased Mims’ patent and reengineered the perforating gun. The gun had to be able to function in high temperature and high pressure wells.
On March 19, 1932, The Lane-Wells company was established in Los Angeles, California and the 128-shot gun perforator was at the heart of the advertised service. The shot gun perforator was remotely controlled which made this an ideal service. It is an established fact that once future clients witness technology that has failed, they will not be any interest in the technology until it can be shown to be useful. Lane and Wells publicly used the reengineered shotgun perforator they bought from Sims on Union Oil’s oil well “La Merced #17”. There wasn’t any production from this oil well until the shotgun perforator was used, but when used, the well produced more oil than ever before.
Usually, innovation arises out of need. Because many of the wells cables failed or were not suitable for oil wells, Walt Wells’ made the first ever conductor cable for high pressure and high heat wells.
The response to the Depression in late 1933 by Lane and Wells was a strategic business move which not only helped drilling companies, but also helped to provide business for their own company. This strategic business move included the opening of an oilfield servicing organization. The service was based on Lane’s “string of coconuts” (Wells, p. 12) as he called his shotgun perforator, that utilized 6- and 10-shot cylinders instead of the original 128-shots.
Much of the oil production in California slowed in 1934, so Wells figured the next good place to establish a business was Houston. In 1934, an electrical engineer named A.B. Winter was hired to service the Gulf Coast area. By 1935, there were 26 employees at the 1315 Palmer Street, Houston office. With a plan to establish a Lane-Wells Oklahoma City office, employee Ira Hahn loaded a truck and set out for Oklahoma. Due to Walt Wells expertly advertising Lane-Well services, the Oklahoma office began without resistance. Ira Hahn noted, ”everyone seems to have heard about new about the services even before the doors were open” (p. 26).
The innovation of Lane-Wells employees was so unique to the well logging industry that the next logical step was to get into the well-logging business. After six-months of testing and research, the Electrolog was built. This open-hole instrument developed by Lane-Wells was cost-effective and efficient.
Nearing the end of the Depression an engineering graduate named Bud Bohn was hired to help with increasing workload. An increase in activity resulted in employees working many hours and sometimes days at a time. Because of the stresses of the increased and difficult work, Bill Lane, who was in poor health, announced his retirement in September 1938.
In the 1940s Lane-Wells employed 412 employees in 28 locations and the international sector consisted of companies from Peru to Trinidad and Tobago. With the Depression at an end, Lane-Wells had to deal with another set-back. World War II was now underway and England was under siege. The United States entered the war after the Japanese attacked Pearl Harbor and marked the beginning of more hardships for Lane-Wells. The hardships were caused by many of the engineers, and other pertinent employees, doing their patriotic duty and joining the war effort.
Walt Wells wrote to the company, “We are proud of the boys we have in the service (and) our employees who are staying on their jobs, doing their best in helping supply oil to keep equipment and supplies rolling along. Let’s all pull together. We have a big, hard, long job ahead of us” (p. 37).
The Los Angeles office was impacted the hardest with most employees from that facility joining the war effort. The company felt compelled to assist in war efforts, so they decided to produce launching mechanisms, projectiles, and fuses for anti-submarine rockets. In another project, Lane-Wells managed the design and manufacturing of optical elements for the U.S. Navy.
By January 19, 1944, Lane-Wells completed the 50,000th job in Oklahoma and by this point, 3,600 oil companies had used their services.
A tougher, reverse-concentric armored cable was developed in April 1944, giving rig workers a more reliable feeling about the perforating cable. Germany surrendered on May 8, 1945 and Japan surrendered within 30 days of the dropping of a nuclear bomb in August 1945.
The standardization of company products did not develop until 1947, and started with the standardization of perforation manuals.
After the collar locator was developed in 1947, for recording the exact location of casing collars, the perfectly molded, high-speed Koneshot Jet Perforator was developed in 1948, improving penetration. By 1948 Lane-Wells extended into Venezuela and by 1949, had moved into Canada.
In September 1948 Lane-Wells Co. completed their 100,000th perforating service at the same well where they began their business. Time Magazine heralded the event when they wrote, “California‘s Lane-Wells Co. has the combination to a safe, packed with black gold. By literally shooting out the oil with a gadget called a gun perforator, Lane-Wells has increased the yield of U.S. wells by an estimated $200 million” (p. 44).
After the magazine’s mention of Lane-Wells in March 3, 1949, Bill Lane died. Fortunately, innovation, recognition of what the company needed to do to survive, and growth, did not stop.
After World War II, Lane-Wells reached an overall employment number of 1,315 people. Although things seemed to be going well, the company took a hit in employment and production with the beginning of the Korean War. Without the appropriate manpower, it soon became difficult to keep up with production requirements.
The ability to recognize what was important and what would keep the company growing and progressing was paramount to Lane-Wells. In December 1950, a 50 percent share of Well Surveys Inc. was bought because their instrumentation and research, were felt necessary in order for Lane-Wells to produce quality equipment. The remaining 50 percent stock was purchased three and a half years later.
Lane-Wells vice president Norm Dorn died in March 2, 1952. During his time in the role, there were 80 field offices and 44,000 wells in the U.S. Norm was instrumental in helping to get the necessary technology by asking himself, “Does it improve our service from the well operator’s viewpoint?” This is a very important perspective as it helps the companies produce only what is needed, saving money in the long-run.
On December 29, 1954, Dresser Industries merged with Lane-Wells, a merger that was not finalized until March 1956. A downturn in the industry started in September 1957 and lasted until April 1958. Although the downturn did hurt the company, Lane-Wells still had a reason to celebrate. The company reached its 25th anniversary and more than 280,000 perforating jobs had been completed. The Elgen Company of Wichita Falls, Texas was next to merge with Lane-Wells. The companies developed a highly profitable, much needed Induction Log that gave formation-depth evaluation.
Lane-Wells moved their operation to Houston in July 1958 in order to centralize the company’s offerings; the best place to do that was in Houston. As with any merger, there is restructuring required within the organization. Part of the restructuring that occurred when Lane-Wells merged with Dresser was that the manufacturing was now done by a subsidiary of Dresser.
Within the year of Lane-Wells centralization efforts of combining three companies into one, a new company was formed. The Westheimer Manufacturing Company was born, and the office located on Westheimer St. in West Houston. The centralization efforts paid off and shortly after, the Densilog tool was added to the growing list of innovations. The Densilog read gamma ray’s from the formation, which allowed the operator to read the density and distinguish if it was water or oil in the formation. Another merger, with Well Surveys Inc., also lead to positive outcomes. The innovative tool that came immediately after the merger was the Neutron Lifetime Log. Designed in 1963, the Neutron Lifetime logging tool was the first commercially available tool capable of locating and assessing oil through cased-drilled wells. The Neutron Logging tool was also the beginning of Baker Atlas’s pulsed-neutron logging instruments.
Many companies insist on their employees being team players because this seems to provide the innovators that help keep the company moving forward. With team effort, the Neutron Lifetime Log (NLL) was invented. The NLL differentiated between oil, gas and water formations, which made it very essential tool to have when logging for oil. It also helped with the discovery millions of barrels of oil that were missed by previous logging tools.
During the Lane-Well’s process of centralizing the company, they company opened their own school teaching students about the different aspects of the oil business. Lane-Wells also negotiated a contract with Argentina’s national oil company in 1959 and acquired a Canadian company, called Eskimo.
On July 1, 1968, Lane-Wells merged with a company similar to their own called Pan Geo Atlas Corporation, and formed Dresser Atlas. Dresser Atlas became known for its expertise as a perforating and logging business and for its completion of jobs world-wide.
In August 1973, the Organization of the Petroleum Exporting Countries (OPEC) sent a shockwave through the United States with the Arab Oil Embargo. By 1979, the price of a barrel of oil was the most that it had ever been at $30.03.
In 1974, Dresser Atlas’s newest innovation was the Carbon/Oxygen Log. The Carbon/Oxygen Log made it possible to determine the water/oil mixture in fresh and saline reservoirs. This tool involved long line of innovations, from the Compensated Neutron Log, to the Spectrilog to the Acoustilog. The invention of the computer made research work easier and logging deeper. The computerized logging systems were introduced by Dresser Atlas in 1979. The workforce became more knowledgeable and many were more experienced personnel. No other company offered more services in logging and perforation business than Dresser Atlas in 1981. At this time, the company operated in 75 international markets and had 90 percent of the domestic market share. Just like previous times, as soon as the oil and petroleum industry were doing good, the industry suffers a downturn.
In May 1987, Dresser Atlas formed a joint venture with a Beverley Hills company, Litton Industries to become Western Atlas International. In 1994 Litton and Dresser spun off Western Atlas as an independent corporation. Western Atlas then performed data analysis, developed software products and was the leading supplier of information technology for the oilfield business. In the 90’s, the industry shifted to the international sector and the technological skills of Western Atlas helped win logging contracts. In 1997 business for Western Atlas excelled and the company was ranked number one in its seismic market.
In 1998 Western Atlas merged with Baker Hughes to form Baker Atlas. In 2005 Baker Atlas was a leader in wellbore imaging, wireline formation testing, and magnetic resonance logging. It had a great reputation as a leader because of its efficiency, people oriented services, and because of data accuracy. The main reason it was a leader in the oil logging business was because of the research and development. Baker Atlas continues to improve technologies and innovate new tools and technologies, improving the production outcome.
This is an extremely informative book that that tells the story of how and where the Baker Atlas company started and from where it started. It also shows how the ability to learn often depends on the desire to succeed. Most of the technological innovations came from technology being reengineered. Innovation and the desire to improve does not only come from technology, but also from the ability to think analytically and creatively. The focus on innovative tools and technologies seems to be what provides Baker with its keys to success.
Wells, S. (2007). 75 years young…Baker Atlas: The future has never looked brighter. Edited by Noel Atzmiller. San Francisco, CA: Chronicle Books.