Those guys at the Hall of Fame quit on Wayne Woolsey too soon.
One of the grand old men of the Wichita oil and gas industry, Woolsey was inducted last year into the Kansas Oil & Gas Museum Foundation Hall of Fame after more than five decades in the industry.
But Woolsey isn’t done. He still comes to the office every day, still runs one of the bigger Kansas-based oil and gas exploration and operating companies, and is still putting big bets on the future.
Woolsey has focused largely on south-central Kansas, pumping millions of barrels of oil and many, many million cubic feet of gas out of the ground. Last year he sold his natural gas pipeline system in Barber County.
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He has played a role in ushering in the latest oil boom in Kansas by selling hundreds of thousands of acres of leases to Shell Oil, and then using the money to become an early adopter among Kansas independents of horizontal multi-stage hydrofrack drilling, something becoming more common among independents.
And, in recent months, he has acquired large stakes in southern Illinois and southern Indiana in the belief that it could prove similar to the southern Kansas.
Really? Starting on a big, new venture at 81.
Woolsey Energy – and Woolsey Operating – aren’t just him, of course. His wife, Kay, is vice president and has been deeply involved in running the company for years. And Woolsey talks glowingly about how competent and experienced his 40-plus staff members are.
Woolsey said he has begun to plan seriously for what happens to his business after he’s gone, but he doesn’t seem to be slowing down.
“I’ve never had any desire to retire. What would I do that is more fun than working with young people and coming up with ideas.
“I realize that, at some point, I’m not going to be capable, but now, I’m in pretty good health, pretty competitive mentally.”
Born in 1931 on a farm in Gunter, Texas, Woolsey was the first in his family to go to college, at North Texas State in Denton. After three years in the Air Force he became a teacher in Petrolia, Texas. He taught classes, drove buses, served as trip chaperone, refereed basketball games.
“My first paycheck was $127 – for a month,” he said. “I took this into the superintendent and threw it on his desk and said ‘Look at that.’ He said ‘What’s wrong with it?’ I said ‘It’s only $127 for a month’s work. I got an uncle in Dallas that pays a drunk service station manager $1,000.’ …
“I loved teaching, but I couldn’t make a living at it.”
Being in Texas, he thought he’d try petroleum engineering as a career. He went to Texas A&M to talk to the head of the petroleum engineering department, who got mad when Woolsey said he had heard there weren’t many petroleum engineering jobs open at the time. He told Woolsey to go to the geology department if that’s how he felt about it. The geology professor he talked to was really nice – and on that turning point, a career choice was made.
“So that’s why I agreed to become a geologist, not really knowing what they did for sure, because the guy was really nice and it was sort of enticing and it was in the same line of work,” he said. “And I’ve never regretted it.
“We are sort of the artists, we draw the maps, we pick the place to drill, and then we hire somebody to drill the well and then complete the well. You design the project, and I liked that part.”
He worked for Texaco, starting in 1958, designing projects and evaluating sites, including in Wichita. He wanted to try getting out on his own, and established his first independent operation in 1970.
Through the years, he’s ridden oil and gas drilling up and down and up and down. At one point in the early 1980s Woolsey had 33 people, a decade later he had three.
The last few years have been a bit of a revelation.
Drilling technology and techniques grew more sophisticated through the ups and downs. Over the last decade, the industry achieved stunning successes using horizontal multi-stage hydrofracking to unlock vast amounts of hydrocarbons in formerly too-difficult to develop shale layers. The Mississippian in northern Oklahoma and Kansas is limestone, not shale, but the idea is similar. Drill down several thousand feet, angle the drill bit until it runs horizontal and then go several thousand feet.
It took Woolsey three horizontal wells to climb the learning curve – to fine-tune the drilling mechanics, to figure the distance from nearby vertical wells, he said. But now they appear to have gotten it down and are drilling more successfully.
His most recent well in Barber County is producing 120 barrels a day and more than 1 million cubic feet of gas, he said. It’s already close to paying off its drilling cost.
Despite the tens of thousands of vertical wells that have been drilled in Kansas over the last 150 years, it turns out there’s still a lot of oil in the ground.
Last year, Woolsey trimmed the number of rigs he operates and now has one horizontal rig and one vertical rig going all the time.
“I see five or so years of growth from just what we have in Kansas,” he said.
The company has 400 operating wells.
Jon Callen, president of Edmiston Oil, said he’s always been surprised by Woolsey’s use of technology.
“You’d normally think it would be young guys coming out of college, using computers and all that kind of stuff,” Callen said, “but he loves what he’s doing and loves the technology.”
But Woolsey can get tough when he feels that he needs to.
Tax assessors in some Kansas counties, who have used a formula created for vertical wells for decades, have struggled in applying the formula to the horizontal wells.
In Barber County, Woolsey contended that the county failed to take into account the cost of drilling the critical water disposal wells as part of the cost of drilling oil wells. The cost is then deducted from the estimated value of the oil in the ground to figure property value. He won his case at the Kansas Court of Tax Appeals in April.
He said it cost him more than $100,000 to win a $100,000 reduction in taxes. It will pay off in future years.
Woolsey said that Barber County has always treated him well in the past and he hopes that will continue in the future.
“I don’t mind paying taxes, but tax me fairly,” he said.
Barber County Commissioner Steve Garten said the county bears Woolsey no ill-will.
“It’s business,” Garten said. “He looking out for his interest, and we were looking out for ours.”
Woodford and Illinois
Woolsey has his sights set on two different opportunities.
He believes that the Woodford Shale, a thin layer below the Mississippian Limestone, is productive and expects to drill a horizontal well.
“I believe there is pretty good opportunity and there are not but a few people who have looked at it,” he said.
But he is also taking a bigger gamble. He has accumulated thousands of acres in southern Illinois and Indiana in the hopes of repeating the magic of southern Kansas.
It’s an old reservoir that produced billions of barrels of oil, he said, but all of that was in shallow formations. He sees an opportunity for oil and gas 4,000 or 6,000 feet down, in some instances underneath previously mined coal beds.
Some residents have expressed worries about the impact of fracking on their water supply, but Woolsey said that’s a fallacy.
“None of this is going to affect the surface,” he said, “unless there’s an accident at the well. That happens occasionally, but when it does, we catch it, clean it up, and we pay for the damages.”
So, why is he making a big bet on the future, at 81?
The money is nice. Woolsey has been very successful that way. But he could have retired to work on his golf game decades ago.
Really, it’s pretty simple. He does it because he likes it.
“Boy, I feel like a 4- or 5-year old with a big Easter basket. That feeling.”