Page 29 - FINAL Phillips 66 50 Year Book

companies had selected the deep-water ports off the southern coast of
Wales for their UK refineries. We were offered some tax benefits if we’d
choose the other side – a more depressed region of the country – and
we took them. Next thing you know, the North Sea is a major oil and
gas producing region. I’d like to say we knew this would happen but I’d
be lying. It’s just one of those things where blind luck later looks like
genius.”

Design or not, genius it certainly was. The North Sea’s southern waters
were rich with natural gas deposits, but essentially no oil. Geologic
studies indicated significant oil-bearing strata were more likely to occur
in the East Shetlands Basin to the north. The London-based exploration
team recommended an aggressive acquisitions effort. John McLean,
then president and CEO, agreed and gave his former London colleagues
the mandate – go north.

“John told us we could have whatever we needed for an aggressive
exploration program in the North Sea,” said Mike Morris, who in the early
1970s was an executive vice-president in Conoco’s Eastern Hemisphere
petroleum division. “It added up to a huge capital commitment. We hit
a dry spell in the early 1970s when we weren’t getting much for our
drilling money, but John never let himself be discouraged.”

In 1970 the international group negotiated a landmark deal in the
company’s history, positioning Conoco to own a major equity interest
in the largest oil field ever found in the North Sea – the Statfjord field.
A farm-in was negotiated with Gulf Oil, who conveyed to Conoco a one-
third interest in their northern UK exploration holdings, agreeing that
Conoco would become operator.

Above: Inspection of fin fans.