The Knox brothers may have believed there was indeed oil beneath their town, but they had never bothered to drill for it. They were quite content to lease the surface and let somebody else pour good money down holes that, for the most part, always came up dry. One of their clients happened to be Hughes and Hughes Petroleum down in Beeville, Texas. When news of the City of Giddings well had reached him, Dan Hughes immediately called the Knox brothers and told them to keep leasing acreage on trend until he told them to stop.
The Knox brothers had no problem leasing land. For hardscrabble farmers, it was easy money. They had managed to lease seventeen thousand acres before Dan Hughes called it quits. His company had been led to drill a well on one of the tracts, which was owned, coincidentally, by John and Bob Knox. But it was just an old chalk well. Came in quick. Played out quick. Nothing more.
As John Knox explained to Randy Stewart, “Dan Hughes was left holding a disappointment and seventeen thousand acres of dog ass land.”
Randy Stewart looked at his map. He checked Ray Holifield’s fault lines. They were scrawled across the same land where Dan Hughes had drilled. Holifield’s marks had been scribbled smack dab in the heart of those seventeen thousand acres. Dog ass acreage. That’s all it was. But Randy Stewart had a job to do.
“How well do you know Dan Hughes?” he asked the brothers.
“We’re pretty good friends,” came the reply.
Stewart nodded and asked, “Will you call him and tell him that the company I’m working with would like to discuss a farm out on his Giddings acreage?”
“Sure. No problem.”
Randy Stewart stood to leave.
Bob Knox stopped him. “There’s one more thing to discuss,” he said.
“What’s that?”
“When we did the leasing for Dan,” he said, “we took a one-sixty-fourth override in the acreage instead of our usual dollar per acre. And we think we should get a one-sixty-fourth from you boys as well, provided, of course, you put this deal together.”
“Done, “ Stewart said.
He didn’t even have to think it over. He knew Max Williams and Irv Deal would agree. No money up front. Everybody gambling on the back end. In the oil business, that was simply good business. Before the afternoon ended, Randy Stewart had scheduled an appointment in Beeville with Hughes and Hughes.
The company had drilled a few locations in the Giddings area with hardly any degree of success. Dan Hughes, when he took the call from John Knox, was sitting in his office with the rights to several thousand acres of farmland stuffed back in his files, and he had little if any interest at all in them. It had all been a waste of money, Hughes thought. He might as well have gone down to the bank, borrowed a couple of hundred thousand dollars, gone out to a barrow ditch on the south side of Giddings, and thrown it away among the weeds.
Randy Stewart placed a call to Max Williams back in Dallas. “How much acreage do you want in Giddings?” he asked.
“As much as you can lease.”
“An oil company named Hughes and Hughes has most of it.”
“They willing to lease?”
“As near as I can tell, they’ve given up on it.”
On the surface, it appeared to Max Williams that the town of Giddings just might be the next hot spot. Of course, he knew, a lot of oil operators in the past had believed the same thing, and they had all been beaten and broken by the devil’s chalk. He wasted little time in placing a call to Ray Holifield. “You might as well head south,” he said.
“What’s going on?”
“We’re moving the Windsor/U.S. operation to Giddings.”
“It’s still the chalk.”
“I’m not as afraid of the chalk as some people.”
“What are your ideas about Giddings?” Holifield wanted to know.
“Same as it was,” Williams said. “Drill as close to the big chalk well as I can get and see if we can locate the same fault. Maybe it has enough oil for several wells.”
“Can Randy get us some good leases?”
“He says he can.”
“Who has the leases now?”
“Hughes and Hughes,” Williams said. “We probably can’t get all of them, but maybe we can acquire enough acreage to get us started.”
“You think Hughes and Hughes wants to get out from under them?”
“Randy thinks they’re tired of the leases costing them money,” Williams said. “From what I’ve been told, they’ve drilled their last well in Lee County. Didn’t like it when they were there. They have no plans to go back.”
Ray Holifield chuckled sardonically. “So you’re dead set on investing good money in the same old ground that turned good money bad,” he said.
“I’ve got a feeling about this one.”
Oilmen always did. Even the broke ones. Holifield laughed again. “I doubt if Hughes and Hughes is willing to turn loose of more than a couple of hundred acres,” he said. “And Randy’s gonna have to do some hard bargaining to get those.”
“You may be right.”
“Can you drill on as little as two hundred acres?”
“If I have to, I can. If it’s the right acreage, I can drill on forty.”
Irv Deal, like his partner, held a deep fascination for the big chalk well and its consistent production on land that, over the years, had become a graveyard for dry holes. The acreage around it might be tough to negotiate, he thought, and since he ran the operation of the company, Deal strongly believed that he was better suited than anyone to make the right deal on the right patch of real estate. He chartered a Lear Jet and flew to Corpus Christi to meet with Dan Hughes. Hughes wasn’t there. Hughes was never there. His office was in Beeville. Irv Deal had a good idea. He was in the wrong city. Undaunted, he promptly rented a car and drove to Beeville.
He sat before Dan Hughes and told him, “We’re planning to drill a couple of wells in Giddings, and I hear you have some property we can lease.”
Hughes nodded. He studied Deal for a moment, then asked, “Are you an oilman?”
“No.”
“What business are you in?”
“I made my money in real estate.”
“Oil is a different game.”
“Not really,” Deal said.
Dan Hughes raised his eyebrow in surprise. “How do you figure that?” he asked.
“All I have to do is replace a building contractor with a drilling contractor, then use a geologist instead of an architect,” Irv Deal replied. “Business is about people. It’s always about putting the right people in place. I know how to do that.”
“What makes you think you can find oil in Giddings?” Hughes asked.
“I can, and I will,” Deal replied.
“It’s a dead field.”
“Somebody found oil.” Deal shrugged. “I’m betting we can do the same.”
Dan Hughes thought it over. He had no faith in Irv Deal as an oilman. He had little faith in Giddings as an oil field. But who knows? There might still be an acorn left for a blind hog to find. “I’ll lease you some land,” Dan Hughes said, “but I want royalties on the back end in case you hit something.”
“How much?”