MITCHELL -- Shortly after prospectors found gold in South Dakota's Black Hills in 1874, miners, settlers and investors flooded in. It's been a storied industry with dramatic ups and downs, but gold mining continues to this day in the Black Hills.
South Dakota's oil and gas industry has endured a markedly different story, what one industry expert calls "a comedy of errors." While oil has been steadily coming out of the ground in the state's northwest corner since the 1950s, one word comes up over and over when discussing South Dakota's oil and gas with industry insiders: "under-explored."
"We have a geologically enticing area that needs to be explored," said South Dakota School and Public Lands Commissioner Jarrod Johnson. "We have oil in South Dakota, without a doubt. We are under-explored. It's just a matter of getting the seismic information."
But launching an oil or natural gas industry requires putting together a delicate formula of geology, knowledge of that geology and enough money to exploit that knowledge. South Dakota is moving forward, with the New Horizons in Oil and Gas conference wrapping up today at the South Dakota School of Mines and Technology in Rapid City.
At the conference, South Dakota's Geological Survey office promoted its ongoing work to compile data useful to oil and gas developers and put that information online. Work to put South Dakota's oil and gas records online began at the behest of former Gov. Mike Rounds after he took office in 2003.
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The records being rounded up date as far back as just after World War II.
"After World War II, the major companies like Shell, Philips, Gulf, Mobil, Marathon - they were all here," said geologist Tony Petres, managing partner for the Inyan Kara Group in Rapid City. "During that first wave of exploration, oil was found all over West River South Dakota, extending to those first counties East River."
In 1950, both Dakotas were "a zero" in the oil industry, with no oil wells in the two states, Petres said.
"In 1951, they drilled a well by Minot (N.D.) - the 'Clarence Iverson No. 1' was the well's name. That was the discovery well for the Williston Basin," Petres said.
In 1954, Shell found oil in South Dakota's Harding County. By then, though, the momentum had moved north to the proven reserves in North Dakota, which is home to the Bakken formation. The U.S. Geological Survey estimates the Bakken contains more than 3 billion barrels of recoverable oil.
"Everybody was pouring their money into North Dakota. It was a sequence of events that left South Dakota in the dark," Petres said.
"Wild-cat" exploration continued in South Dakota throughout the 1950s, with test wells being drilled in various parts of the state. Many of those test holes showed oil and gas, those in the industry say. But the technology of the day was not able to easily get the resources out of the ground and into the marketplace.
"Pretty much all of them found oil, all across the western two-thirds of the state," Petres said.
"But it wasn't oil that flowed to the surface, so they didn't give it much consideration."
For example, there was a rock core sample drilled in Meade County in 1957 that was "completely saturated with oil," Petres said. But at the time, the oil was deemed too heavy to be usable.
Geologist and oil developer Dudley Bolyard noted in a recent keynote speech at the SDSM&T conference that the Meade County well was abandoned Dec. 22, 1957. He called it the "Gotta get home for Christmas" well.
"A lot of people would say they were just too anxious to leave it," Bolyard said. "It's an important show. We have more exploring that we need to do."
Bolyard noted that the Meade County hole was drilled just two years after the technique of hydraulic fracturing, or "fracking," was invented.
"They probably had no idea they could have fracked that well and made it a producer," Bolyard said.
When oil was discovered on Alaska's North Slope in the 1960s, oil investors simply had no interest in paying to explore in South Dakota, Petres said.
"Shell and Gulf pulled out of here, along with the others," he said.
A second, smaller wave of exploration in the late 1970s and 1980s led to oil production in Fall River County, South Dakota's most southwestern county.
If the exploration of the past didn't produce the kind of oil and gas industry enjoyed by neighboring states of North Dakota and Wyoming, it did leave behind the records of the test holes and other geologic and seismic data.
It's a lot of contour lines on maps and charts with the same kind of erratic lines one would see on a heart monitor. There is no "X'' to mark the spot of the treasure, but it's all enticing enough to oil and gas developers that many believe South Dakota is on the verge of another big wave of oil exploration - and possibly a big discovery.
North Dakota's famed Bakken oil fields do not extend into South Dakota. Bakken's southern border dips enticingly close but stops at North Dakota's southern-most counties.
The Bakken formation is contained within the Williston Basin, which extends well into South Dakota. The basin covers roughly the northwest quarter of the state.
Another formation within the Williston Basin - the Three Forks - does extend south into South Dakota. And there are myriad other geologic formations mentioned by oil and gas folks.
"Geologically, what we have under our state is not the same as what North Dakota has - not as favorable for oil production," said Derric Iles, South Dakota's state geologist. "Yet we have a rock unit called the Englewood Limestone. Directly underneath the Bakken is a unit called the Three Forks, and they are also producing oil from the Three Forks. That rock unit does come into South Dakota."
Iles believes it's likely that the natural gas that has long lit the flaming fountain at Capitol Lake in Pierre comes from the Williston Basin.
The gas comes directly from a formation called the Dakota Sandstone and is noted on a 1941 map as the "Pierre Gas Fields."
"I don't think it's the Dakota Sandstone that's producing the gas. That's just where it has migrated to," Iles said.
"In all likelihood, it's coming from deeper sediments from the northwest and west. There's a large area where we have documented shows of gas in water wells. It's there, and over a very large area."
During the first decades of the 1900s, the city of Pierre lit its street lights and heated homes using that natural gas. Recently, there has been exploration in Stanley County looking for natural gas.
"That gas is still there," Iles said.
While Iles says South Dakota will never match North Dakota for oil production, he believes the state has untapped potential.
"It's unreasonable to expect all of the oil and gas resources stop at the state line," he said. "We are under-explored."
As he looks for potential opportunities, Bolyard told the SDSM&T crowd that areas along the Cheyenne River are "obvious places to run a seismograph across," because they have the geology that's likely to lead to a natural gas discovery.
"These features have not really been explored," he said.
South Dakota's next oil-and-gas wave seems to already be swelling.
Recently, Bedrock Oil and Gas of Texas bid more than $500,000 at a state auction to lease nearly 67,000 acres for oil and gas exploration - mostly in Harding and Butte counties.
School and Public Lands Commissioner Johnson said he believes the company is "looking for the next big thing."
"It just makes sense that they are getting the land together to do seismic evaluation and to explore," Johnson said.
Last year, the city of Faith, in Meade County, went looking for water and hit oil. Work to evaluate whether that strike will turn into a producing well remains ongoing.
Earlier this year, plans to drill oil near Bear Butte, also in Meade County, sparked controversy among many American Indian groups that consider the landmark sacred. The uproar led the state to impose stricter guidelines on oil developers, but the drilling has proceeded.
Other than that, oil and gas developers appear to face no organized opposition from environmentalists, including Pete Carrols of South Dakota's Sierra Club.
"As far as South Dakota developing our oil, I'm not opposed to it," he said. "Compared to tar sands oil (in Canada), North and South Dakota's oil and gas is a superior alternative."
Perhaps the most important event for South Dakota's oil and gas industry is the painstaking work being done quietly by the state's geological survey office.
"This is a critical step that must occur before we can go much further with any of the science," said state geologist Iles.
"I have reassigned the majority of my staff at the geological survey to work on data compilation and the scanning process."
The project is designed to spur economic development by putting as much information into the hands of developers as possible, Iles said.
"We want to make it as easy as possible to have the industry decide that South Dakota is a good place to invest," he said, calling the project "a full-tilt effort."
The records include databases, detailed maps, geographic logs, scanned oil and gas permits from decades ago and more. Once completed, the website will be feature-rich, offering pop-up labels of well names, permit numbers and other information.
Already, some information is available at http://denr.sd.gov/des/og/oghome.aspx. Iles hopes to have the site substantially completed by year's end.
"We are pushing extremely hard to have something significant by January," he said.
Ultimately, South Dakota's future in oil and gas production will be up to investors more so than geologists. Those who can pay to explore decide when and where to drill.
"The more you drill, the more you find. The more you find, the more investment for more drilling follows. It's a self-perpetuating process," Iles said.
"When additional exploration and proper testing occurs, we will see an expansion of oil and or gas production. That's easy for me to say. I'm not laying out $2 million to $3 million for wild-catting."
Petres looks to a neighboring state to explain just how much of South Dakota remains unexplored. "There are counties in Wyoming that have more wells drilled in them than the entire state of South Dakota," he said.
And Bolyard calls those test wells "just pin-points of knowledge in vast ignorance."
So developers looking at South Dakota have those pin-points, all of the maps, records of decades past and the promise of a slick website. They have that and the weather-worn optimism of men like Petres who have studied the geology, the industry and the investors who pay the way.
"The oil they found is still here," Petres says of the 1950s-era exploration.
"It's just waiting for somebody to come in and make the investment. And it's been a long wait."