Natural Gas

The earliest natural gas find is reported to have been in Scott County in 1887 during an effort to develop a commercial water well. The second recorded gas well was drilled two years later (also in Scott County) by an oil driller, Harry Kelly, to a depth of 1,600 feet. This was recognized as the first recorded effort to find oil in Arkansas, though “only gas was present.” No other efforts to find oil or gas were reported until 1901–1902, when the Mansfield Pool was developed by Choctaw Oil and Gas Company.

While no oil was found, this effort did provide large amounts of gas, with some wells producing as much as 5 million cubic feet of gas per day. This 3,000-acre field was sufficient to provide commercial gas services to the town of Mansfield (Sebastian County). By 1907, Fort Smith (Sebastian County) and Van Buren (Crawford County) had commercial service, and an industry was developing. Other finds included Polk, Conway, and even Pulaski counties. However, only the town of Plumerville (Conway County) made commercial application. Street lamps there used natural gas for a period of time prior to 1909.

It is clear from the available records that there was no effort to develop a significant commercial natural gas industry in Arkansas during the early twentieth century. Natural gas finds were either failed attempts to find oil or incidental to an oil find. Demand for natural gas was very low, and the product was mostly considered as undesirable and of very limited or no value to those seeking oil.

All of this changed dramatically in 1921, when the first oil field in Arkansas was discovered southwest of El Dorado (Union County). The discovery touched off one of the great oil and gas booms in American history. The frantic search for oil in the state also resulted in the discovery of gas fields from Fort Smith to Pulaski County.

The large amounts of gas found in south Arkansas were considered a byproduct that presented a problem for a conservation-minded oil producer. Additionally, much of the product there was considered “sour-gas,” as it contained large amounts of sulfur and ammonia compounds. As the gas was “flamed-off,” it created a terrible smell that came to define the area for a time.

In the Arkansas River Valley area (Arkoma Basin), communities were gradually developing commercial-residential uses for the natural gas that had been found in the unsuccessful search for oil in that region. The Arkansas General Assembly began earnest efforts to regulate the exploration of oil and gas resources in 1923 for both conservation and public safety concerns. By 1939, the current structure of the Arkansas Oil and Gas Commission had essentially been established.

In 1927, Governor Harvey Parnell and the Arkansas Geological Survey (AGS) commissioned a major study of the potential for oil and gas production in the central and northern parts of the state. The report, prepared by renowned geologist Dr. Carey Croneis, resulted in a large influx of speculators into many parts of the state that never anticipated any such interest in their lands. Unfortunately, they were not prepared to understand the value of their resource. Hundreds of thousands of mineral rights were sold by residents during the Depression and remain in the control of out-of-state corporations, which continues to affect subsequent generations of land owners whose land is used for natural gas production.

The demand for natural gas for household use and for industrial purposes began to develop rapidly in the 1930s. Northwest Arkansas eventually had a flurry of activity in the late 1920s, and Arkansas Western Gas Company was established in Fayetteville (Washington County) in 1929. Their exploration subsidiary, Western Gas Production Company, was established in the 1950s. In 1978, a major reorganization established Southwestern Energy Company as the parent firm, which was relocated to Houston, Texas. However, one of their production companies, Seeco, Inc., remains an Arkansas corporation. It was Seeco, Inc., that led the discovery and then the development of the Fayetteville Shale formation production in 2004. This find was at one time considered the tenth-largest gas field in the United States.

By 1945, Glen Martel had applied this abundant resource to power the operations of the Magnolia Cotton Mill in one of the first major industrial applications. Arkansas Power and Light Company (AP&L) touted its gas-fueled McKamie Plant in Lafayette County as the future of electric generation in the country.

Ammunition production during World War II finally created a real demand for the noxious and dangerous chemicals found in much of the gas of south Arkansas. A subsidiary of Lion Oil Company developed the first chemical and industrial process in the United States to extract ammonia and other chemicals from natural gas. With millions of tons of chemicals to be processed, these efforts led to the development of several munitions plants in the state. Postwar industries converted the extraction process to the development of fertilizer and other chemical products, which continue to be major products of the region.

While many in Arkansas have made fortunes in the oil and gas industry, two names are most associated with natural gas: T. H. Barton for his early efforts and Witt Stephens for the expansion of Arkansas Louisiana Gas Company (Arkla) and multiple uses of natural gas. Barton recognized the value of the gas by-product and formed the El Dorado Natural Gas Company in the very early stages of the oil boom in south Arkansas. Stephens saw the demand for multiple applications of natural gas. He gained control of Arkla, created a major exploration and production company (Stephens Production), and encouraged an expanded use of natural gas for both industrial and residential purposes.

Arkansas has traditionally produced natural gas to meet about one percent of the nation’s demand for natural gas. However, the finds of nonconventional shale gas in the 2000s had the state moving to produce gas to meet about two percent of that demand. Arkansas also supports a major natural gas transmission system of pipelines, developed in the mid-1960s, that carry much of the natural gas that is used in the eastern part of the United States. Within the state, about one-third of natural gas use is by industry. Fifty percent of households are heated by natural gas.

Production of natural gas in Arkansas significantly changed starting in about 2005 with the development of production in the Fayetteville Shale formation in central Arkansas. This formation at one time produced about sixty percent of the natural gas in Arkansas. In 2009, there were 5,600 gas wells operating in the state, with several hundred being developed each year; by 2016, however, there were no active drilling rigs in the Fayetteville Shale due to falling natural gas prices brought on by oversupply. Plummeting natural gas prices and dwindling production began threatening the tax revenue stream for some municipalities in the Fayetteville Shale and elsewhere, such as Pangburn (White County). Southwestern Energy Co., based in Houston, Texas, filed lawsuits in six Arkansas counties disputing the way its taxes were being calculated and ceased paying some taxes altogether as the cases worked their way through the courts. The Pangburn School District, with Southwestern as its largest taxpayer, confronted shortfalls in 2018 that left it without enough funds for library books, new teachers, and other necessities.

The Arkoma Basin Province has long been the source of natural gas production within the state, as the largest conventional gas production is in the Cecil field in Franklin County. This discovery was made in 1950 and remained highly productive. The Aetna field in Logan County continues to be a very significant producer, and Hanna Oil and Gas Company of Fort Smith developed a 90-million-cubic-feet-per-day well, the Lincoln No. 2, in Crawford County. Clearly, these and other areas have long-standing natural gas interests.

The Arkansas Oil and Gas Commission has three office locations across the state, and its activities and responsibilities involve the regulation of natural gas production. The agency’s website reflects current and historical production, including the current operators. The agency is directly responsible for putting in place policy to protect the environment, public safety, and conservation. The Arkansas Department of Environmental Quality coordinates its efforts with the commission in the implementation of those policies.

For additional information:
“ADEQ Hires 6 to Monitor Gas Drilling,” Talk Business, September 28, 2010.

“ADEQ Improves Natural Gas Drilling Wastewater Regulation,” KUAF Ozarks at Large, February 13, 2010.

Albright, Amanda. “It’s a Natural Gas Giant vs. School Kids in Arkansas Tax Fight.” Bloomberg Business, December 8, 2018, https://www.bloomberg.com/news/articles/2018-12-07/huawei-arrest-keeps-u-s-china-lng-spat-alive-developer-says (accessed February 15, 2022).

Arkansas Oil and Gas Commission. http://www.aogc.state.ar.us/ (accessed February 15, 2022).

Forbes, Gerald. “Brief History of the Petroleum Industry in Arkansas.” Arkansas Historical Quarterly 1 (March 1942): 28–40.

Martel, Glen. “Oil and Gas in Southwest Arkansas.” Arkansas Historical Quarterly 4 (Autumn 1945): 196–214.

Stroud, R. B., R. H. Arndt, F. B. Fulkerson, and W. G. Diamond. Mineral Resources and Industries of Arkansas. U.S. Bureau of Mines Bulletin 645. Washington DC: U.S. Department of the Interior, 1969.

Larry Taylor
Springfield, Arkansas