User:Jnoble1/Texas Independent Producers and Royalty Owners Association (TIPRO)

Texas Independent Producers and Royalty Owners Association was founded in 1946 by Texas wildcatters. TIPRO has grown into the largest statewide association of its kind in the nation with more than 2,400 members. For nearly 60 years, they have been a leader in the charge for independent producers and royalty owners.

TIPRO History: The stories of the independent producers and royalty owners

While the legal beginning of TIPRO starts in 1946, its philisophical origins predate that event. To understand the dynamic of the premier association for independents, one has to understand how oil became king in Texas.

One by one the great oil fields of Texas were discovered: Spindletop in Beaumont in 1901; Burkburnett in North Texas in 1915; Luling in Central Texas in 1924; Santa Rita - the strike that funded the Texas university systems for a century - in the West Texas Permian Basin in 1923; Amarillo in the Panhandle in 1926, and more.

Circumstances in each field raised specific conflicts between independents and the majors. Often, the issues involved the majors' reluctance to invest in the risky and expensive exploration phase but then swoop in after a discovery and use various methods to corner the field's supply and distribution. These behaviors contributed to the 1880's anti-trust legislation against Standard Oil and the formal break-up of the trust into Seven Sisters in 1911. These companies, however, often continued such business practices.

The most dramatic and significant example of this was the world-famous East Texas Field. Discovered during the Great Depression, hundreds of farmers, share croppers and all manner of workers toiled for little or no pay in exchange for royalties if anything materialized. Many majors thought it was a fool's errand.

Then the Daisy Bradford hit in 1930. Overnight hundreds of regular citizens became royalty owners. In no other place in the world were so many regular citizens such large, private owners of a precious natural resource. The largest reserve discovery in the world at the time, the 600 derricks in Kilgore, TX in 1935 alone signaled the presence of almost as many wells as the town had people in 1930. (Lawrence Goodwyn, Texas Oil, American Dreams, p.53) This discovery also made the Texas Railroad Commission the most influential governing body for global oil prices.

But such a significant supply also had a quick and devastating impact on global oil prices, sending them plummeting due to overproduction and theft and raising the ire of the majors. They lobbied hard at both state and federal levels for proration limits and other measures to reduce the flood of supply. Seeing this massive threat to their livelihoods, many independents resisted such measures, especially those dictated by the Railroad Commissioners in Austin, TX. In 1931, martial law was actually declared in East Texas with National Guard troops sent out by Governor Ross S. Sterling to enforce the limits.

Against this backdrop, independent producers began organizing. Regional groups formed in each significant field in Texas. The East Texas field gave rise to the Independent Petroleum Association of Texas in 1933, the group that would later reconstitute itself as TIPRO in 1946. (Goodwyn, p. 51)

The War Years: Oil

In his book Texas Oil, American Dreams, which places the founding of TIPRO into the political context, Goodwyn states, "The event that caused Texas oilmen to take notice was the public surfacing in 1943-44 of the Anglo-American Petroleum Agreement. (Goodwynn, p.58)

"One of the key conclusions of the agreement was that 'American security required restraint on the use of domestic reserves and larger drafts on foreign oil supplies'," he wrote. (Goodwynn, p. 59)