Ronald P. Nowak¹, Herb R. Rohloff¹, Eric B. Gardner¹
(1) 3DX Technologies Inc, Houston, TX

Abstract: The rise and fall? of technology based small independents in the 1990's

Following the downturn of the 1980's, the domestic onshore oil and gas industry experienced an exodus by the majors, and a corresponding increase in small independents. In the early 1990's, 3-D seismic migrated from the offshore domain to the onshore. As 3D's became more and more prevalent, fewer plays were drilled on 2D seismic, and many of these small independents were ill prepared for the change. A niche developed in the industry that sprouted a new breed of small independents. Armed with the technical staffs that had developed the capabilities to work in the 3D environment, smaller companies such as 3DX Technologies Inc. and others were beginning to compete with the technology that traditionally resided in large company environments. Even though business strategies were different, the companies were linked with a common thread that success and growth of the company would be derived from the use and application of onshore 3D seismic. Could 3D be the "silver bullet" to economically rejuvenate an onshore program?

By the downturn in 1998, the technology based small independents had exhausted their capital acquiring 3D surveys with little left to exploit their drilling opportunities. This left the companies with debt-laden balance sheets, scrambling to raise capital, at a time of extremely low oil prices. The results to date have been a series of mergers, bankruptcies, and financial failures, signaling the fall of many of those unique independents.

AAPG Search and Discovery Article #90914©2000 AAPG Annual Convention, New Orleans, Louisiana