The rapid expansion of shale drilling since 2004 has resulted in the coining of terms that imply immediate success: references to a “gale” or a “boom” come to mind.But the shale success story seems more like a string of gunfire that happened incrementally over time as oil and gas prices fluctuated and technology advanced.At least that's the case in The American Shales, which chronicles the history of shale exploration in the US

The book, which was written by Oil and Gas Investor's editor-at-large Nissa Darbonne, taps a small army of sources, such as the late George Mitchell, whose use of a light-sand frac revolutionized development of the Barnett shale, and Bobby Lyle, who first fraced horizontals to exploit the Middle Bakken, and many other lesser-known but key players in North American shale development.It details the big deals, the technology and the long odds championed not by large IOCs, but by independent companies such as Devon Energy Corp., Brigham Exploration Co., Southwestern Energy Co., Range Resources Corp., Chesapeake Energy Corp. and Petrohawk Energy Corp.

“When I was at Chevron, we had a guy come through the overseas business [unit],” geologist Kent Bowker, who left Chevron Corp. to work for Mitchell in 1997, tells Darbonne.“He actually told us he felt sorry that we had to try and find oil and gas in the US because it was obvious that there really wasn't anything left.He said we could work overseas, instead, and do exciting projects.Now, the rest of the world is trying to emulate what we've done here in the US”

But what's been done in the US didn't happen overnight.After the success of light-sand fracs in the Cotton Valley, Mitchell tried it out in vertical Barnett wells in 1997, making the play more economic.Meanwhile in the Williston Basin, where, in 1996, many thought more production was impossible, Lyle contrived a way to horizontally produce from the Middle Bakken in Montana in 2000.

In this book, the key shale players' personalities are portrayed against a historical backdrop that shows how petroleum came to be the most powerful commodity in the post-war West.And, it demonstrates the long odds shale developers faced in the pre-shale-boom era.Mitchell stuck it out in the face of low prices when geologists and engineers told him he was wasting his time.The Middle Bakken zone that Lyle drilled was only 10 to 15 feet thick.And, though the Marcellus had good shows when Range drilled through it over the years, it was ignored until technology to produce it economically arrived.With innovative thinking, creative deal-making and marathon work, whiffs of grapeshot transformed into the boom we know today.

—Caroline Evans

Bakken: 2010

In April 2010, Brigham Exploration sold more stock—this time at $18 per share—which had recovered to roughly its value at the June 2008 high.

The company's public debt was $159 million and cash on hand was some $378 million.Its bank facility, with a $110-million borrowing base, remained untapped.

Bud Brigham was asked if he had received calls to sell.“There is, as you can expect, a lot of interest,” he said at the time.

In 2011, in just six years, 21-year-old Brigham Exploration had been transformed from a Gulf Coast, short-reserve-life, hit-or-miss, gas-focused producer to a long-reserve-life, high-margin, oil-resource leader.Some 56% of its proved reserves were in the Willis-ton Basin; in the heart of the Bakken play, it held 164,000 net acres.The wells were expected to pay out in fewer than 18 months at roughly $75 oil and make some 600,000 barrels equivalent each, more than 90% of that oil.

And oil had reached $100 again; it was now $110.

Dave Pursell and fellow analysts with Tudor,

Pickering, Holt & Co. Securities Inc. noted, in early 2010, the operator's uninterrupted run of enormous Bakken wells.After its first 11 attempts that came on with fewer than 1,000 barrels, its next 100 had come on with more than 1,000.They called the stock their top E&P pick and reported, “This is the name to own.”

There was also more pay.There was the uppermost layer of the four Three Forks benches underlying Bakken.Also, Continental Resources, which determined this in 2008, proceeded to demonstrate in mid-2011 that production from the second Three Forks bench was yet another payzone without interfering with production from the middle Bakken or Three Forks 1.

Bud Brigham had let investment-banking firm Jefferies & Co. know that he would be open to talking to a potential acquirer.The company's stock price was now about $25.Its Bakken position was teed up for sale.

“We kind of looked at it as 'we built the factory.'From there, we needed to invest $13 billion just to drill the inventory that we had delineated and we were a $3.5-billion company.So it made sense for us to bring in a much larger company that had a lower cost of capital and a much larger balance sheet—a company that could run the factory we had built and appreciate and take care of our people.”

Production was 21,000 barrels equivalent a day net to its interest and indications were that this could grow to as much as 100,000 a day in the next five years.

Statoil ASA had already zeroed in on Brigham Exploration, among others, when looking at companies it might take in to increase its upside exposure to US shale plays.On Dec. 13, 2010, it let Jefferies know it was interested in entering the Bakken.Statoil and Brigham signed an agreement to discuss this further.

The international super-major's journey into the new world-class US unconventional-resource plays had begun in 2008 in western Pennsylvania in Chesapeake's acreage in the wet-gas Marcellus play.In 2010, it ventured to South Texas in a 50/50 deal with Talisman Energy Inc. in the wet-gas-plus-oil window of the Eagle Ford.

The third leg of its strategy took it to Austin, Texas, a city more known for state politics, music and film careers, college football, computer-maker Dell Inc. and natives who urge “Keep Austin Weird.” Tucked in the rolling hills along the Colorado River was Brigham Exploration and an unconventional-resource exploration team with play-leading experience in the oily Bakken.

In the Marcellus, Statoil was a nonoperator; Chesapeake was operator.In its newly gained position in the Eagle Ford, it was a nonoperator; but, in the terms of its JV with Talisman, it would become operator of 50% of the joint assets by the end of 2013.

It needed a US-based, shale team.

The entry to the Marcellus play had represented real assets to Statoil but also an education.The arrangement included embedding Statoil personnel in Chesapeake's team for hands-on experience with drilling these shale-gas wells.In the South Texas deal, it would gain more production and reserves—and experience.If buying Brigham, it would gain its Bakken assets as operator as well as its personnel who knew how to make oil from tight rock—and not just smaller-molecule gas and natural gas liquids.

Statoil's debt-to-equity ratio was only 14% and it had about $15 billion of cash on hand.It had sold its retail-fuel business for $900 million, its assets offshore Brazil for $3.1 billion, 40% of its interest in the Canadian oil sands for $2.3 billion and some Norwegian midstream properties for $3 billion.

By September 2011, Brigham and Statoil managers had met in Houston, New York City, Austin and Statoil headquarters in Norway during the previous nine months.The Statoil board offered $34.50 cash per Brigham share.

Brigham countered with $40, to which Sta-toil chief executive Helge Lund replied, “…Perhaps negotiations of a potential acquisition should cease.”

He and Bud Brigham then met in London—“a neutral location”—on Oct. 14, 2011, where Lund offered $36.50.The deal was signed Oct.

16.Statoil and Brigham issued the press release the next morning.Statoil would pay $4.4 billion in cash for Brigham shares and assume Brigham's $300 million of debt, for a total deal value of $4.7 billion.

The merger was completed Dec. 1, 2011.

Brigham had turned $25,000 of start-up capital in 1990 into a $4.7-billion enterprise.On a per-net-acre basis, Statoil was paying $8,000.Brigham had picked up its leasehold for $100 an acre or less.

Torstein Hole, Statoil senior vice president, US onshore, was in Williston, North Dakota, meeting Brigham employees based there and area community members the day the deal was announced.Until the Bakken deal, Statoil had an operated position in the US only in the Gulf of Mexico, where the sole mineral-rights owner is the federal government.Onshore the US, it would work with surface- and subsurface-rights owners ranging from resident or absent landowners to trusts to native-American nations as well as local, state and federal governments.

Hole said at the time, “It is part of our policy to have a good relationship with all stakeholders.Brigham is very well aligned with the way we want to work.We will also learn from them as we extend our operatorship in other areas as well.

“…So far…shale production in other places in the world has not taken off to the same degree as it has in the US but…we know there are resources elsewhere in the world.”

Brigham had turned $25,000 of start-up capital in 1990 into a $4.7-billion enterprise.