1 THE GREAT CANADIAN OIL PATCH, SECOND EDITION. By Earle Gray Drilling rigs in the Petrolia oil field, southwestern Ontario, in the 1870’s. The rigs were sheltered to protect drillers from winter snow and summer rain. Photo courtesy Lambton County Museums. “Text from ‘The Great Canadian Oil Patch. Second edition: The Petroleum era from birth to peak.’ Edmonton: JuneWarren Publishing, 2005. 584 pages plus slip cover. Free text made available courtesy JWN Energy. The book is out of print but used copies are available from used book dealers.” Contents Part One: In the Beginning xx 1 Abraham Gesner Lights Up the World xx 2 Birth of the Oil Industry xx 3 The Quest in the West: Two Centuries of Oil Teasers and Gassers xx 4 Turner Valley and the $30 Billion Blowout xx 5 A Waste of Energy xx 6 Norman Wells and the Canol Project xx 7 An Accident at Leduc xx 8 Pembina: The Hidden Elephant xx 2 Part Two: Wildcatters and Pipeliners xx 9 The Anatomy of an Oil Philanthropy xx 10 Max Bell: Oil, Newspapers, and Race Horses xx 11 Frank McMahon: The Last of the Wildcatters xx 12 The Fina Saga xx 13 Ribbons of Oil xx 14 Westcoast xx 15 The Great Pipeline Debate xx 16 The Oil Sands xx 17 Frontier Energy: Cam Sproule and the Arctic Vision xx 18 Frontier Energy: From the End of the Mackenzie River xx 19 Don Axford and his Dumb Offshore Oil Idea xx Part Three: Government Help and Hindrance xx 20 The National Oil Policy xx 21 Engineering Energy and the Oil Crisis xx 22 Birth and Death of the National Energy Program xx 23 Casualties of the NEP xx Part Four: Survivors xx 24 The Largest Independent Oil Producer xx 25 Births, obituaries, and two survivors: the fate of the first oil ventures xx Epilogue: The End of the Oil and Gas Age? xx Bibliography xx Preface and acknowledgements have been omitted from this digital version of the book. Part One: In the Beginning Abraham Gesner Lights Up the World He was buried, ignored and forgotten in an unmarked grave for 69 years; it was Imperial Oil that finally recognized his efforts, erecting an impressive monument in 1933. Chiselled on the granite shaft are the words: “Erected as a token of appreciation for his important contribution to the oil industry.” 3 By 1864, “coal oil,” the popular name for the liquid he named kerosene, was the almost universal lamp fuel in North America. It proved efficient, relatively safe, and cheap enough to be used by both city merchant and backwoods farmer. It transformed home lighting, and its development gave rise to the giant international oil industry many years before the invention of the motor car.1 “He” was Abraham Gesner and 1864 was 18 years after the first public demonstration of a new lamp fuel he had developed. He used a contraction of the Greek word keroselaion, meaning wax oil, to name it kerosene, but it was known as coal oil because most of it was at first produced from coal — until an adequate supply of crude oil provided a far cheaper feedstock for scores of coal oil refineries that had arisen within a decade. Gesner was a Nova Scotian farmer, horse trader, physician, geologist, naturalist, entrepreneur, lecturer, author, and “the father of the modern petroleum industry,” in the words of the U.S. National Aeronautics and Space Administration.2 With his restless mind, he experimented with ways to use bitumen for fertilizer, developed one of the first electric motors, driven by a voltaic battery, and produced an array of inventions: briquettes made from compressed coal dust, a machine for insulating electric wires, a wood preservative, a process for using asphalt to pave highways. He endured shipwreck, arrest, extraordinary toil, bitter losses, and domestic tragedy. He made investors wealthy but never found the fortune he sought. Rights to a rich bitumen deposit that historians say should have been his were awarded to a rival who reaped a fortune. Another rival who independently developed a coal-based lamp fuel years after Gesner, reaped a fortune and died a wealthy benefactor. Gesner died poor, forgotten and ignored in his own country, buried in an unmarked grave in his native Nova Scotia. Almost from the beginning of time, man had struggled against the dark, with bonfires, torches and, thousands of years ago, had burned olive oil and fish oils from the open half of sea shells or other primitive lamps. But for the most part, darkness still reigned. Wood was the all-purpose fuel in the home of most early Canadian settlers, from the 17th into the early 19th century. Burned in open fireplaces, it was often the only fuel used for heating, cooking, and lighting. It didn’t give much light, but after intense physical labour from dawn to dark, early settlers tended to go to bed early. Starting fires with flint and steel was a difficult business. In winter months, the trick was to never let the fire on the hearth go completely out. 4 Next to the open hearth, candles made from the fat of sheep and cattle were the most ubiquitous form of light. Beeswax candles were better but cost more. An 1839 recipe gives the following instructions for making a good candle: “Melt together ten ounces of mutton tallow, a quarter of an ounce of camphor, four ounce of beeswax, and two ounce of alum. Candles made of these materials burn with a very clear light.”3 Tallow candles had their problems. When burned, they dripped messy fat. Too close to the hearth, or in the heat of summer, they melted. Unless carefully stored, mice and rats ate them. Candle holders varied from tin cups to elaborate chandeliers of cut glass with intricate designs and ornamentation. Next came the oil lamps that burned olive oil, fish oil, a variety of other fluids, and above all, whale oil. There were, briefly, lamps that burned lard in solid form. The great variety of fuels and lamps, with their different designs, features and methods of operation, bears testimony to the fact that none were found fully satisfactory. And they all, candles and lamps alike, posed a constant threat of fire. None were more dangerous than the “camphene lamps” that burned an explosive 10-to-one mixture of alcohol and redistilled turpentine. On June 12, 1846, at the St. Louis Theatre in Quebec City, at the site of the present Chateau Frontenac, a camphene lamp, one of an array of lamps on stage, was accidentally knocked over. Fire quickly engulfed and destroyed the building. Forty- five charred bodies were recovered the next morning. It was not an uncommon occurrence. The best light came from the whale oil lamps. But whale oil was expensive, and increasingly so by the mid-19th century when at least some species of whales faced extinction. Whale oil was used not only for lamp fuel but also for heating and lubrication, for making soap, paint, and varnish, and in the processing of textiles and rope. The pliable bones from the jaws of most whales were used to make corsets, skirt hoops, umbrellas, buggy whips, and carriage springs. What was left of the whales was sold for fertilizer. The whaling industry hit its peak in the mid-19th century, when 80 percent of the world’s whaling ships were American. In 1846, the year Gesner first publicly demonstrated his kerosene, whalers aboard 735 American ships were hurling their harpoons off Newfoundland, the West Indies, Brazil, rounding Cape Horn to fish the Pacific, “even through Bering’s Strait, and into the remotest drawers and lockers of the world,” as Herman Melville wrote in Moby Dick. The right whale was being killed at a rate of 15,000 a year, and only an estimated 50,000 were left by the time hunting for them stopped. “Had it not been for the discovery of Coal Oil, the race of whales would soon have become extinct,” the California 5 Fireside Journal declared on September 3, 1860. “It is estimated that 10 years would have used up the whole family.” Spermaceti, commonly called sperm oil, was the best whale oil for lamps. It is found only in the nose of the sperm whale. Other whale oil was called “train oil.” By 1856, the price of sperm oil in the United States had risen to $1.77 a gallon while train oil fetched 95 cents. With the introduction of Gesner’s kerosene, the whale oil industry disappeared almost overnight, while the price of coal oil steadily dropped to as little as seven cents a gallon. The adventures of Abraham Born in 1797, Gesner was one of 12 children of Loyalists who had fled to Nova Scotia after the American Revolution, to take up farming at Chipman’s Corner on the Bay of Fundy. Publicly funded schools had not yet arrived in Nova Scotia and only the fortunate received formal education at private schools, however primitive some of them might have been. Gesner was one of the lucky ones, and lessons on natural science provoked a fascination that endured all his life. By the time he was 15, schooling was over and Gesner was working full-time on his father’s farm. He devoted most of what time was left to reading, collecting sea shells, fossils, rock samples, and experimenting with chemistry in an old shed behind the farmhouse. Eighteen-fifteen and 1816 were disastrous years for farmers in Cornwallis Valley. An unprecedented invasion of mice utterly destroyed the crops of 1815, and when they suddenly died, the mice were raked up by the tens of thousands in huge heaps.