At a lunch meeting with his father and other Oklahoma City business leaders in the early 1970s, Larry Nichols began learning an important lesson about his city.
“As we looked out from the Petroleum Club over the Presbyterian Health Center, they talked about how the medical center and downtown business core would someday merge,” Nichols said. “I looked at this vast mess of a slum before Bricktown and thought those guys were crazy. But now it’s happening.”
Four decades later, the co-founder and executive chairman of Oklahoma City-based Devon Energy Corp. is one of the most outspoken leaders of Core to Shore, an effort to stimulate similar growth southward, connecting the downtown central business area to the Oklahoma River.
From his office on the 47th floor of the new Devon Tower, Nichols gazed at the barren patch previously home to Interstate 40 and the empty or rundown buildings along the way.
“You can look from this building to the river and snicker at Core to Shore just as I snickered at filling in the core to the medical center,” Nichols said. “It will take a while, but I think it will happen.”
Nichols’ confidence is based on the growth the city already has experienced over the past few decades.
“The exciting thing is we have built a very exciting platform for growth in downtown Oklahoma City,” he said. “That has a momentum today that has never been this good, certainly not in my lifetime. It continues to attract developers and people and places to live.”
The Oklahoma City economy has been tied closely to the oil and natural gas industry throughout its history.
Boom times like the 1970s and early 1980s and today have been periods of strong growth, while downtimes like the mid- to late 1980s have seen interest and activity in downtown shrink away.
“You always want diversity in an economy, but the times we have now are totally different from the era of the early ’80s,” Nichols said. “That was a boom of absurd proportions, a boom that was really driven by real estate, but oil and gas played its role, too. It was a crazy time when you saw lots of irrational behavior by a surprising number of people.”
The industry — and the city — are both different today, Nichols said.
“There was euphoria in the early ’80s that the price of oil was going to go up forever, that if you weren’t a millionaire, you soon would be. Irrational euphoria gripped the entire southwest,” he said. “There’s none of that euphoria now. Everyone in the industry has a much more mature understanding that prices go up and down. They will never go up forever, and they will never go down forever. With that knowledge, there’s not that opportunity for irrational behavior.”
While Oklahoma City continues to grow, the energy industry likely will experience improvements, as well, Nichols said.
“The history of this industry is one of technology continuing to open up new opportunities,” he said. “I can give numerous examples of any one geographic area being totally exhausted and totally produced just to have new technology open it back up.”
Nichols pointed to the growing Mississippi Lime play of northern Oklahoma, where Devon and other producers are using horizontal drilling and hydraulic fracturing to produce large amounts of oil and natural gas from some of the state’s oldest oil fields.
“You would think by now Texas and Oklahoma would be totally depleted, nothing left,” he said. “But that’s wrong. Technology has opened up new horizons. There’s no reason to think the current technology is the last technology, that there will be no new technology out there going forward.”