Mitchell saw riches where most saw stone

The oil and gas boom that is revolutionizing the politics and economics of energy worldwide started in the 1980s with the solitary — even stubborn — persistence of George Mitchell.

Mitchell, who died Friday at the age of 94, believed then that he could produce natural gas from a dense underground formation of shale rock beneath Fort Worth.

Few thought he would succeed and even his own engineers disagreed with his approach.

But Mitchell pushed employees at Mitchell Energy & Development to keep at it, toiling for 17 years with efforts to combine hydraulic fracturing with horizontal drilling in a way that could unlock natural gas.

“My engineers kept telling me, ‘You are wasting your money, Mitchell,’” he told Forbes in 2009. “And I said, ‘Well damn it, let’s figure this thing out because there is no question there is a tremendous source bed that’s about 250 feet thick.’ We made it to be the hottest thing going.”

Shale skeptics: Hydraulic fracturing pioneer Mitchell recalls early skepticism

As he approached age 80, after a long and successful career in the oil industry, natural gas started flowing at high rates from his experimental wells in what became known as the Barnett Shale play of North Texas, according to a biography on the website of the Cynthia and George Mitchell Foundation.

Mitchell’s innovation produced the modern combination of hydraulic fracturing, horizontal drilling and slick water — a mix of water, sand and chemicals forced into a rock formation to unlock oil and gas — that transformed the world energy landscape, said Mark Zoback, a professor of geophysics at Stanford University.

The resulting booms in shale gas and oil led to huge jumps in U.S. fossil fuel production, billions of dollars of new investments, and ballooning ranks of energy companies throughout Texas.

Mitchell’s innovations were central to the big growth in domestic energy production, said Texas Railroad Commission Chairman Barry Smitherman, whose agency regulates the state oil and gas industry.

Since 2000, U.S. oil and natural gas production both have surged about 30 percent, according to the U.S. Energy Information Administration.

“Think about where we were before it happened,” Smitherman said. “We were contemplating importing natural gas from other countries. Electricity prices were very high in Texas… And all of that has turned completely 180 degrees.”

Mitchell’s success came with a persistent effort to squeeze natural gas out of rocks with pores 1,000 times smaller than the pores in a tombstone, Zoback said.

But beyond hoping to fracture those rocks and pull out gas, Mitchell also targeted fossil fuel-rich rocks that extended more outward than downward, he said.

“It was also the realization that these formations are not very thick, maybe a couple of hundred feet thick, but they’re laterally very extensive,” Zoback said.

In his words: The duty to fracture responsibly

While he developed the new approach, drilling laterally and using hydraulic fracturing, Mitchell spent a lot of time and frustration digesting failure.

“It took a decade and a half of conviction, investment and dogged determination,” Pulitzer Prize-winning author and oil industry historian Daniel Yergin said in a statement. “In the face of great skepticism and refusing to accept ‘no’ as an answer, Mitchell dramatically changed America’s energy position.”

The shale boom brought on by Mitchell’s innovation led to major growth at companies like Apache, Anadarko Petroleum, Chesapeake Energy, and Devon Energy, said Joe Pratt, an oil historian and director of the Houston History Project at the University of Houston. Devon bought Mitchell’s company for about $3 billion in 2002.

Energy majors eventually got in on the shale action, with Exxon Mobil purchasing natural gas player XTO Energy for about $25 billion in 2010.

Hydraulic fracturing has critics — communities that claim the process can taint water supplies, environmentalists concerned about the wastewater it produces and worried that a nation flush with carbon-emitting fossil fuels will be slower to adopt alternatives.

But others emphasize that combustion of natural gas produces less carbon dioxide than burning coal, and the bounty of cheap gas has prompted power generators to switch from coal to gas-fired plants.

“Until just a few years ago, we were getting half of our electricity from coal and we were generating 2 billion tons of carbon dioxide (annually) doing so,” said Zoback. “Those emissions are rapidly going down.”

However the environmental debate plays out, it’s not debatable that the huge supplies of U.S. natural gas pushed its price down to the lowest levels in a decade, prompting chemical companies and other manufacturers to take advantage of the cheap fuel.

Companies have since announced nearly 100 chemical projects, worth a combined cost of $72 billion, aiming to benefit from low cost natural gas, according to a report from the American Chemistry Council. Chemical companies use natural gas as a fuel and raw material.

Those jobs and investments might not have been possible without Mitchell’s vision and determination, Pratt said.

“Conventional wisdom was that it couldn’t be done and his persistence was based on his faith that it could be done,” Pratt said.

“Now would there have been someone else with the confidence and persistence to have made this possible? We’ll never know, will we?”