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Cowabunga! It’s Heavy Oil!

Charlie Marren was like any farmer - concerned about having enough water. Sloughs dried up in the hot summer sun. His cows couldn’t eat snow all winter. So he was pleased in the summer of 1926. After six weeks of laborious effort, he and his helpful neighbors struck a good body of water at a depth of 160 feet.

Then the cows refused to drink the water. It did smell off but cows sometimes drank some pretty terrible slough water. Maybe they would come around and drink it eventually. But the cows were stubborn. A visitor in the district, about 10 miles south of town, knew of the laboratory at the University of Alberta where you could send your well water for analysis. So the visitor took a sample and a few days later the reply came back. The water contained significant amounts of petroleum distillates. It didn’t take Charlie and his neighbors long to put two and two together. They had almost struck oil.

Now there’s an old saying around the oil patch that "before you can find some oil you have to find some money." Charlie was soon involved with some promoters in raising money for the brand new Marren-Lloydminster Oil and Gas Company. There was great excitement in the local paper, the Lloydminster Times, about Lloydminster having its very own oil field. The excitement spread and, in the heady days of the late 1920’s, people pushed their money forward and subscribed some $100,000 in the Company which had little to offer beyond some discontented cows.

Whatever happened to the $100,000 and the promoters, or even Charlie Marren, are questions that still need to be answered but the oil bug had bitten and soon other reports were coming in. Oil was reported down along the Battle River near Ribstone Creek. It was a fair distance from Lloydminster in those days but it kept the topic hot. Other discoveries were made and producing wells brought in, some near Borradaile. Other wells were disappointing. When the drill hole was baled there were definite signs of oil, in fact, oil itself; but it didn’t come gushing out of the ground. You couldn’t even pump it out. It was black and sticky and looked more like tar than crude oil. Reluctantly, such wells had to be abandoned and the search continued for a "real producer".

Caught up in the excitement but recognizing the need for solid business organization behind the search for oil was Lloydminster’s C.P.R. agent O. C. Yates. O. C. had been bitten by the oil bug for some time. He had followed local water well drillers all over the country trying to get a better understanding of the underlying geology of the area. In February of 1933 he called a meeting and invited community men who might support the idea of developing oil or gas and be able to express there support financially. The upshot was the Lloydminster Gas Company.

Soon, that company had a rig drilling just north east of town, manned by the most experienced driller in the area, Charlie Mills. Being so close to town, the project attracted a lot of interest. The mayor, Dr. G. L. Cooke was out at the site on November 20, 1933 to man the controls for the official "spudding in" ceremony. The large crowd contained a goodly number of shareholders in the Company as it was entirely financed by local subscribers.

All winter long, drilling progress was the prime topic in the homes and cafes of Lloydminster, and the Times kept its readers informed all winter with "breaking news" headlines. Cold temperatures and heavy snows slowed progress but as winter eased, optimism grew. Then, early on Good Friday morning, March 30, 1934 natural gas was struck at 1200 feet and the well blew in. By noon a large crowd had gathered and some claimed they could hear the roar of the gas escaping the hole up to 14 miles away.

All weekend, the crowds gathered to watch in amazement. The nervous entrepreneur, O.C. Yates paced among the crowd pleading with people not to smoke. It being Easter, many had lunches of hot cross buns with them. There was great excitement about the gas being able to supply the heating and other energy needs of the town.

Sure enough, by "Fair time", in July, a makeshift pipeline had been run the short distance to the Exhibition Grounds. Some gas burning stoves had been brought in, and the mayor was on hand again to join in a demonstration that proved that Lloydminster was now "cooking with gas". By November, over 200 homes were connected, new homes and businesses were being established and the bright light of natural gas was dispelling some of the gloom of the Great Depression.

Meanwhile, other companies were springing up and exploration continued apace, south, north, east and west of Lloydminster. Colony Oil and Gas Company brought in two producing gas wells in 1935. However, Lloydminster Gas Company No. 2 hit only salt water, proving that oil and gas exploration was still far from an exact science.

Finally, in May of 1937, the Dina Oil Company Limited, back along the Battle River, brought in a well that produced a good flow of good quality oil. Soon three other wells were drilled and a small refinery was set up after shares in the new Dina Oil and Refining Company Ltd. had been heavily subscribed. O. C. Yates was the president of this new company and its Field Superintendent was the intrepid driller, Charlie Mills.

The first Dina Refinery was so small it did little more than heat the crude in hopes of encouraging some of the impurities to leave. As well, the site, while near the new Dina wells, was so far out of Lloydminster it was inconvenient for workers and spectators.

All this while, Charlie Mills, and others, had been grappling with the problem of recovering the heavy oil. So it was that Charlie was the one to introduce, in 1943, the new drilling technology of the rotary rig. The old cable tool rigs which had been used up to that point had actually involved punching a hole in the earth’s crust. The rotary rig, which rotated a three headed drilling bit, could drill more easily and to greater depths.

With the new rotary rigs, more wells and more producing wells began dotting the countryside prompting the desire to build a larger refinery, this time at Lloydminster. The first of these began in 1939, but what would emerge as the largest, and certainly the longest lasting, began construction in late 1946. This was a project of Husky Oil Company whose founder, Glenn E. Nielson oversaw the dismantling of some equipment in Wyoming and its shipment to be part of the new refinery in Lloydminster. In addition to equipment, people were added to operate the new refinery.

One of the new additions to the refinery, and to the community, was Vic Juba. Vic began work at the refinery on May 1, 1953 and soon had the job of lab supervisor. One of the lab’s main jobs was to find new and better uses, and better ways of handling, the still heavy crude that was the main product of the Lloydminster area fields. New equipment was added, such as the Catformer and the Unifiner, to allow the impurities to be removed and a relatively high octane leaded gasoline was produced for several years. A lot of heavy oil went into the production of asphalt shingles which for many years was one of Lloydminster’s largest manufacturing products.

The struggle to overcome the challenges of heavy oil and make it a viable feedstock for the thousands of petroleum based products of today continues. The massive, multi-billion dollar Bi-Provincial Upgrader continues the work begun so long ago and on such a small scale by the Dina Refinery.

Following in the legacy of Charlie Mills, drillers also contribute their growing expertise to the challenge of recovering. The advances in horizontal drilling and steam assisted gravity drainage are bringing new increases in the amount and percentage of useful product recovered from the immense reserves which still lie beneath our feet.

As in the past, so today, the Heavy Oil Industry contributes excitement, optimism and an ongoing substantial economic benefit to our community. Look around and see not only the hundreds of direct employees but the thousands of others for whom oil makes a difference. Whether its the teacher whose students have parents employed in the oil industry, the service personnel in the hotels and restaurants frequented by oil workers, or simply the community members who benefit from having the diversity of a vibrant and rapidly evolving industry in their midst, everyone benefits from the Heavy Oil Industry.

So it is that the OTS Heavy Oil Science Centre strives to preserve the history of the "oil patch", and inform all our visitors of its many accomplishments, past, present, and future. Charlie Marren’s cows didn’t like it, but we’re excited and proud to be part of the Heavy Oil Industry. We hope that after you visit the centre, you will share our pride and excitement in Heavy Oil; part of our past - key to our future.