How wildcatter Harold Hamm became the biggest winner in the biggest American oil find since Prudhoe Bay
Harold G. Hamm is lost. The 66-year-old founder, chairman, and chief executive of Continental Resources (CLR) is steering a Chevy Tahoe past sunflower fields and grazing cows in western North Dakota. He’s found millions of barrels of oil in these low prairie hills, but on this bright fall day, he’s having trouble locating one of his own drilling rigs.
In the back seat, Hamm’s public-relations handler uses her smartphone to get their bearings. “So, we go three miles east, five north,” Hamm says in his Oklahoma drawl. “Got it.” Meandering past an idle John Deere combine and clutches of mobile homes where oil workers live, he points out wells his company has already drilled as if showing a guest around his home. He misses a turn, shrugs, stops, doubles back. “It’s a great day in North Dakota,” he says. “We’ll find it.”
Finally, he pulls into a dusty yard surrounding a 140-foot-tall rig. Workers hustle around in hard hats and black fire-retardant coveralls. From this single location, Hamm explains, four drills will corkscrew down nearly two miles, then turn and pierce the rock horizontally, two wells to the north, two to the south. He pulls on his own hard hat and coveralls, jams his hands in his pockets, and beams at the rig. Shouting over the whine of a drill bit, he says, “Without a doubt, this is going to be like the one up the road. It came in close to 2,000 barrels a day.” That translates into about $150,000 in revenue per day to Continental Resources.
Hamm is the man who bought the Bakken, the shale formation that’s the biggest U.S. oil find since Alaska’s Prudhoe Bay in 1968. The Bakken stretches from central North Dakota into the northeastern corner of Montana and up into southern Saskatchewan and Manitoba. He leased his first acres and drilled his first wells in North Dakota nearly 20 years ago, and stayed with it when others gave up. Today, Continental, with a stock market value of $13.5 billion, vies with oil giants such as Hess (HES) for the most Bakken acres under lease (more than 900,000), the most drilling rigs (24), and the most wells (more than 350). Continental’s revenue has nearly tripled from two years ago to an expected $1.76 billion in 2011, while profits have grown sevenfold to an estimated $538 million, according to data compiled by Bloomberg. Hamm and his family control 78 percent of the company’s shares, a stake valued at more than $10 billion....MORE