?Clayton W. Williams Jr., chairman, president and chief executive of Clayton Williams Energy Inc. in Midland, has been a wildcatter for more than 50 years. Known as Claytie by one and all, the affable Williams rolls the dice in an industry full of risk-takers, having won and nearly lost several fortunes. He is also known for his candor, broad grin and stream of witty sayings. He loves to laugh at himself.

Colorful is but one of his claims to fame. When his daughter was born in the 1980s, he flew a pink flag from atop his office building in downtown Midland—replacing, temporarily, the Texas Aggie flag that normally flew there.

His passions? Big game hunting all over the world, world-class Brangus cattle ranching, and anything to do with Texas A&M University. His airplane and his tuxedo are both Aggie maroon.

Williams is a serial entrepreneur who preaches the gospel of free enterprise at his beloved alma mater, A&M, which he graduated from in 1954 with a degree in animal husbandry. He is a self-made leader who has founded 26 companies, built and sold numerous oil and gas companies, a major gas pipeline, a bank and real estate developments. He’s won most of the awards the oil industry, A&M and Texas business community can give. He failed, however, in his 1990 attempt to win the governor’s mansion in Austin.

He’s a man of action. In 1982, when he needed to tear down an old drive-in theater in Midland to make way for ClayDesta, his new office park, his ranch hands on horseback pulled the screens down. Some 46 people have been with him for at least 20 years, so he jokes that either he pays them way too much or they can’t find jobs elsewhere.


Williams once began his testimony at a Texas Railroad Commission hearing on the poor state of the industry by entering on a stretcher, bandaged and carried by a bevy of nurses. In 1991, when his private oil company was hours from having to file bankruptcy, he balked, deciding to keep going. With great effort, he paid back every dollar owed. In his 2007 biography, Claytie, he says it’s how a man handles failure that determines his eventual success.


The current downturn is not his first rodeo. “I’ve seen all the ups and downs, but I’m a wildcatter—I’m addicted.” Once again, Claytie is reinventing himself to survive. We caught up with him in Midland.


Investor Claytie, how are you coping with this latest downturn?
Williams Well, $50 oil doesn’t multiply as good as $100 does—even an Aggie can do that math. But this time, we wonder, how many other shoes are going to fall? Here we are now, worried about all the banks. What in hell is a subprime loan? In October, I had 13 rigs running, then I read in The Wall Street Journal that the banks would not even lend to each other. I said “holy mackerel,” and I pulled back on my drilling.
I don’t want to burn through these locations with the low prices. I’m being real conservative right now—I’m only drilling one well, and it’s a $15- to $18-million wildcat in South Louisiana with BP. It works at $3 gas. It’s 20,000 feet deep.
You know, it takes time to explore. It’s not a quarter-to-quarter thing. I once tried drilling some wells in Argentina and got handed my hat, so I got my Aggie self back to the U.S.

Investor You’ve been through this before. What lessons can you give us?
Williams Don’t sell anything at low prices—I learned that in the fifth grade. But, in 1981, I owed $500 million. By 1982, I had sold my oil production to Petro-Lewis. I was cutting down because I knew I needed to. Then, in 1985, the Saudis opened the valves and oil was dropping by a dollar a day. I still owed about $300 million and I figured we only had 11 days left! I woke up one day with a migraine headache, but I called it the “Oh, ****, I’m going broke” headache.
You know, debt is good, but it’s also bad.

Investor What other advice do you have?
Williams There is no long run in this business until you have a short run first. If you don’t like this business, you’d better get out of it.

Investor And now you’re trying to form a service company?
Williams The business model at Clayton Williams is broken. We always shot a lot of 3-D, drilled one good well and one bad one. The fracs ended up costing as much as the well. We tried some Chinese rigs, but that equipment didn’t speak English. Pipe doubled, tripled. How much can you spend buying all the things you need to get ready to drill?
So I’ve got a new unit called Little Dog Drilling. If you don’t have rigs at the start of the next upturn, you’ll miss out, so I’m preparing.
We’re trying to streamline the company, cut costs, train people on the rigs, even acquire some frac trucks if I can. The next boom begins whenever oil and gas supply falls.
I don’t feel like I’m earning my keep unless I’m doing something—but that attitude can get you in trouble, too. You’ve got to be patient.