LEXINGTON, Okla. — - - -
Optimism and hard work are what made Hamm a quintessential American success story. His public relations person jokes that once people talk to the upbeat, personable oilman, they're "Hammanized." Even many of his political foes say he's hard not to like.
After leaving Lexington, Hamm moved to Enid, a town north of Oklahoma City that was experiencing a small oil boom. He did a joint work-study program, pumping gas while finishing high school. It took up to 60 hours a week, and he wrote a paper about the Oklahoma oil industry success stories of the century. Inspired, he went to work for an oil service company and then for Champlin Petroleum, a major oil company at the time. Oil workers were, he recalls, "a different breed . . . charismatic, uninhibited." After a few months, he went into the oil service business himself in 1966, starting out with one truck.
Although he was of draft age, with an A1 physical rating, he wasn't called to serve in Vietnam. "I guess the Lord didn't mean for me to go," he says.
In 1971, he lined up his first exploration deal. He was lucky. The first well he drilled produced oil. The second produced at a rate of 75 barrels an hour, "a very, very nice well," he recalls. The field ended up producing 6 million barrels, enough for Hamm to take college classes in geology and chemistry, though he did not earn a degree.
The sharp price increases that hit with the oil shocks of 1974 and 1979 created new demand for exploration in the United States. That helped Hamm's service company, which then had 11 rigs, some of which could drill as deep as 20,000 feet.
Companies were beginning to learn how to do "directional drilling," a precursor to today's horizontal drilling. Suddenly, urban mineral rights were valuable. "We drilled 16 wells under the city of Enid between 1983 and 1985," Hamm says.
What set Hamm apart from other moderately successful independent oil companies was the Bakken Formation and more effective drilling techniques. Horizontal drilling can snake a pipe through a two-foot wavy layer of oil-rich rock, and hydraulic fracturing, or fracking, can create more fissures over greater distances than before. Instead of tapping 15 or 20 feet vertically, oil companies can now tap miles of oil-bearing rock horizontally.
Hamm turned to North Dakota before most oilmen. Mineral rights were a fraction of what they cost now, and Hamm said he had "a gut feeling" that he would find a lode there. In 2004, Continental Resources drilled what Hamm calls "the first commercially successful well in the North Dakota Bakken to be both horizontally drilled and fracture stimulated."
The North Dakota rush was on. The number of rigs drilling in North Dakota has increased tenfold since then, and production has jumped sevenfold. And it has turned Hamm, who was already a rich man, into a very, very rich man.