Innovation catapults H&P to No. 2
Published: November 3, 2002
TULSA -- For Tulsa-based Helmerich & Payne Inc., it doesn't seem to matter how market winds are blowing in the oil and gas industry.
2.
Helmerich & Payne Inc.
The company is sailing along
despite treacherous waters in
the energy industry.
While most of Oklahoma's oil and gas concerns foundered amid a weak oil and gas market last year, H&P was busy climbing to the No. 2 spot on The Oklahoman's ranking of publicly traded companies.
Ranked 35th in the 2001 edition of Oklahoma Inc., the company has risen largely on the strength of its commitment to efficiency and innovation.
H&P Chief Executive Hans Helmerich said 2001 and 2002 have been years of transition for the 82-year-old company.
H&P dropped its exploration and production subsidiary in September through a tightly coordinated acquisition/spin-off maneuver that gave its stockholders another symbol to track on Wall Street.
The company acquired Denver-based Key Production Co. Inc., combined it with an H&P exploration, production and gas marketing subsidiary.
H&P immediately spun them off into a freestanding, publicly traded company under the name Cimarex Energy Co.
Five of Cimarex's nine board members are either H&P officers or were assigned by the mother company.
Helmerich, who is one of the new company's directors, said Cimarex's stock is worth about $700 million, which is large enough to compete in exploration and production industry.
About 80 percent of the new company's production will be natural gas.
The spin-off has returned H&P back to its roots as a contract drilling company.
While H&P has real estate operations in Tulsa, Helmerich said the company's primary focus is on oil-field services, which is what his grandfather Walter Helmerich and William Payne started in 1920.
By the middle of next year, H&P expects to have 125 rigs in its fleet, including 12 platform rigs and 43 of the company's newly designed and built FlexRigs.
Helmerich said the company is halfway through a building program that is adding 25 FlexRigs at a price of about $11 million apiece.
Helmerich said the new rigs are 20 percent more efficient, safer to operate and technologically advanced.
Helmerich said the FlexRigs are in high demand. The activity rate for an average rig in the industry is 64 percent. FlexRigs are working 95 percent of the time.
Despite a low national rig count, H&P is seeing prosperity, and Helmerich expects even brighter days ahead.
"I think we're going to stay active."
