Chester Benge

Chester B. Benge Jr. joined Big 6 Drilling Co. in 1955 as a combination secretary-bookkeeper. Only 25, he was hired as a management trainee with the view that he might run the company someday. It worked out pretty well: he became vice president in 1970 and since 1979, he has been president of the private Houston-based driller. He still works every day and maintains relationships with customers.

Since the company bought its first rig in 1945, it has drilled more than 3,500 wells, mostly in Texas and Louisiana, for over 1,000 clients. Big 6 is generally considered as having pioneered the “turnkey” drilling contract along the Texas Gulf Coast in 1949, although it rarely uses that format today, as most operators continue to hire rigs on a dayrate basis.

In the 1950s, while working for the company during the day, Benge attended night classes at the University of Houston, where he received a Bachelor of Business Administration in 1959. He has remained active with the Cougars ever since. A former chairman of the university’s board of regents, he was instrumental in establishing the school of petroleum engineering.

“I laid the first few bricks and then others built the wall,” he says. “Here we were, the largest university in the energy capital of the world, and we had no school of petroleum engineering!” Today this school has about 270 undergraduates, and Benge is on the dean’s advisory boards for both petroleum engineering and the business school.

He has always been active in civic and professional organizations as well. Benge is currently a member of the U.S. Oil and Gas Association, the American Association of Petroleum Geologists and other industry groups.

As a longtime member of the International Association of Drilling Contractors, he served as secretary, vice president, president and chairman of the executive committee. In 1989, the IADC named Big 6 contractor of the year. In his IADC roles during the 1970s, he testified before Congress several times and also spoke to high school students to urge them to join the petroleum industry.

In a 1979 interview with TIME (when the industry was booming and the U.S. produced 8.7 million barrels a day), he said, “The oil business is one of the few where you can go to bed poor and wake up rich.”

Investor How did you get into this business?

Benge The first rig I was ever on, I was eight years old. A family friend took me and my mother and dad out to the rig. They were fishing at the time, which I was surprised to learn was not about catching a fish—they were retrieving a lost tool in the hole.

Investor What was your first job in the oil patch?

Benge It was with the Humble Oil & Refining Co. I was in their training program, which moved us around a lot, and I mistakenly thought that meant they didn’t like me, so I left after a while. I went to work for a drilling contractor (…that later became known as) Grey Wolf Drilling. And that’s where I really learned a lot. I was primarily in accounting but worked in the field a bit, filling in for gaugers and switchers.

In 1955 Weldon Smith asked me to join Big 6. I was going to the University of Houston at night the whole time, and also had joined the Air National Guard. When the Korean War came up, I was activated and was over there for two years. When I first joined Big 6, I updated their administrative procedures and set up a control system for reducing costs.

Investor What is Big 6 doing today?

Benge When I joined we had two rigs, and eventually, we ran five rigs for several years. We are down to two rigs today and both are busy. One is a brand new, 1,600-horsepower rig; the new technology is exciting to see. It’s on its fourth well in the Permian Basin. The Permian is hotter than the Eagle Ford right now.

Investor Is there dayrate pressure due to that boom?

Benge We are on a two-year contract so we are locked in. The second rig is working in the Gulf Coast region for various operators.

Investor How can you compete with the much bigger companies with bigger fleets?

Benge Personal relationships with the customers—they become our friends and we treat them properly, and vice versa. We have a list of over 1,000 clients we’ve developed over the years. Sometimes we may not have drilled a well for them for a few years, but they come back to us. Our typical customer is a private independent.

Investor Are most of your wells horizontal these days?

Benge We added the 1,600-horsepower rig to expand our market. Most of the new wells are deeper than they used to be and we can accommodate that. You know, there’s so much talk about alternative energy like solar and other sources. We’ll have that maybe in 50 years, but in the meantime, nothing can compete with oil and gas, and it is horizontal drilling that does it, getting these tight reservoirs to give up their oil and gas.

Investor Do you ever provide vendor financing, where you take a piece of a well for having drilled it?

Benge Generally, no. I am not in the loan business—although I do serve on a bank board. By the time a customer comes to a drilling contractor, they’ve probably shopped their well all over town. Good prospects sell fairly quickly.

—Leslie Haines