?Oklahoma-born, Yale and Colorado University graduate John A. Masters moved to Calgary in 1966 as president of Kerr-McGee Canada. But he left Kerr-McGee later, and formed Canadian Hunter Exploration Ltd. with fellow geologist Jim Gray in 1973.
In 1974, the young company drilled 84 wells. Rapid growth followed, but the best was yet to come. In 1976, it found and confirmed Elmworth Field on the Alberta-British Columbia border. It is still one of the largest gas discoveries in the Western Canadian Sedimentary Basin, with more than 30 trillion cubic feet of reserves.
It was Masters who coined the term “deep basin” to describe this prolific area, which grew into a huge gas play 250 miles long and 40 miles wide, still one of the most heavily drilled plays in Canada today.
Canadian Hunter was acquired by Burlington Resources in 2001 for $3.3 billion.
Supposedly retired and now living south of Denver, Masters at age 80 is still practicing geology, his first love. In 2006, he went to Saudi Arabia to do some brief consulting, about which he prefers to be circumspect.
Now he is working on some big oil prospects in New Mexico, Utah, Idaho, Nevada, Wyoming and Montana.
In his 1980 book The Hunters, he recalls how he created Canadian Hunter and found Elmworth. It’s full of lessons about managing people, growing a company and believing in the power of the mind. Masters says, “Oil is found with ideas. So far, no oil basin in the world has yielded all its oil. But many have lain dormant for long periods, waiting for someone to achieve a new concept.”
Masters has always been a bit of a contrarian. He’s made a list of breakthrough ideas that people at first thought were crazy, impossible or useless. “Why would anyone ever need a telephone?” people asked Alexander Graham Bell in 1876.
“Part of the definition of a new idea is that it will be rejected at first,” Masters says. “Evolution teaches us that most new ideas don’t work, so we learn to be against them. Big ideas do not come from groups or committees. Throughout history they have come from individuals...and ‘normal’ people almost never recognize the importance of the idea until much later on.”
Masters invented the “resource triangle” and published it in AAPG Explorer in 1979. It’s now the classic way to show the distribution of natural resources—oil and gas or lead, zinc, silver and gold. The best-quality resources that are in the smallest supply are always at the very top of the triangle. Now he wants to pursue those kinds of reserves again.
Investor John, what are you up to these days?
Masters I am trying to start a new E&P company and raise some money. It will aim to find what I think are some very big reserves, that have lesser porosity and permeability than what most companies look for in the U.S. Rockies.
Investor What do you mean?
Masters I think probably two-thirds of the hundreds of geologists in Denver spend all their waking hours on the Denver Basin. It’s a pretty good basin, but it’s been drilled to pieces. There’s a whole world of other basins out there.
Investor What are you looking at?
Masters Go west of the Overthrust Belt in Wyoming that separates the Rocky Mountain geosyncline from the Cordilleran geosyncline in western Wyoming, Utah and further west. Thousands of wells have been drilled on the eastern side of that line. But west of the Cordillera geosyncline relatively few wells have been drilled.
Investor Where would you like to drill?
Masters Eastern Idaho, the northwestern half of Utah, and a fairly large piece of Arizona and Nevada, and westernmost Wyoming and Montana. This is a huge area. The striking thing is, only a few wells have been drilled, and the other striking thing is, it’s got five to 10 times as much sedimentary thickness as the eastern areas of the Rockies
Investor What about Covenant oil field that was found in Utah a few years ago?
Masters Covenant is like the new fields I expect to find in the Cordilleran. In the west, you do not see hundreds of companies working like those on the eastern side of the Rockies. I have more than 20 sizable prospects—I never reached that number up in Canada. Elmworth was a great discovery, but I think I see more opportunity down here than I had in Canada in the 1970s!
Investor Tell us more about Elmworth.
Masters We worked for 20 years to develop that field and figure out where it would extend. It ended up something like 250 miles long and 30 to 50 miles wide in places. The most amazing thing is that the majors had drilled 93 dry holes in the region, and they decided there wasn’t a chance of finding oil there.
Back then, gas had no value and if they found some, they did not drillstem-test it. A brilliant log analyst named Lloyd Fons (who lives in Houston now) looked at those dry holes for us. In all of them, he saw bypassed gas pay on the logs. It was a revolutionary judgment…no other professional log analyst in Calgary would have dared to tell those majors they had missed that gas pay.
Investor Original thinking is as important as science?
Masters That’s exactly the point. The person with insight and determination to recognize something contrary has to fight not only the science, but public opinion. People think you are crazy or stupid. They make fun of you or fire you. For a while there, Canadian Hunter was made fun of for two or three years—then Exxon bought a 12.5% interest in the field for $250 million!
You’ve got to have guts and brains.
We have such high commodity prices now, you can make so many things economic. And I intend to.