Mexico to find his fortune. He followed her suggestion and got a job with Gulf Oil in Tampico, Mexico. It was a wild place. Strake arrived shortly after Pancho Villa was assassinated with more than forty dum-dum bullets. The ghosts of Zapata and Madeira still haunted Mexico. War damage and carnage from the Revolution remained everywhere. Bandits were still common. In a short time, Strake rose to head of the Gulf office in Tampico, supervising nine to ten employees. He also met the woman who would become his wife, Susan Kehoe.
Strake and Susan met while both were on vacation in San Antonio. If George tended to be a bit crusty, Susan was convivial, genial, and outgoing. She never met a stranger. After they got married, it was thanks to Susan’s friendly disposition that they became close friends of their neighbors in Tampico, the William Buckley family. On many occasions, they babysat the Buckleys’ young children, baby Bill Buckley, Jr. (later the famous National Review magazine founder) and his young siblings, Jim and Pat. Their friendship led to a financial partnership. Buckley grew to love the Strakes and indicated to George that if he left Gulf Oil and went on his own, Buckley, with the assistance of some New York banks, would finance and participate in Strake’s exploration ventures.
With this assurance, Strake left the security of Gulf Oil and began pursuing oil prospects on his own as a “wildcatter.” Wildcatters were the brave, slightly mad fringe of the oil industry who pursued oil discoveries in unexplored frontier areas — examples including Glenn McCarthy, portrayed in the movie Giant, and the legendary Columbus Marion “Dad” Joiner, who found the vast East Texas oilfield, the largest of America’s oilfields in those early days. Ironically, Joiner hit oil only after selling more than 100 percent of the prospect to unsuspecting investors. Mexico was a dangerous place in the 1920s, still wildly lawless. Life was cheap there, and property rights of little regard. This was the Mexico depicted in John Huston’s great movie The Treasure of the Sierra Madre. But unlike the prospector depicted in the film, Strake amazingly succeeded and began to turn a profit.
Strake also began investing his profits in a small U.S. startup company named Radio Corporation of America (RCA), which dealt in the new technology of “wireless” or radio. Strake knew something about this, since he had used radio in the Army Air Corps. Later, in addition to making radios, RCA started the National Broadcasting Company (NBC). Strake was successful in both his technology and oil investments. By the late 1920s, however, Strake instinctively realized the end was coming in Mexico. Strikes began at refineries and oilfields in Tampico and spread, ultimately leading to the government’s seizure of the entire industry. Strake sold out and took his family out of Mexico well before the seizures, with $250,000 in profits. Grateful for his narrow escape with his wife from the increasing lawlessness and governmental expropriation there, Strake swore off Mexico.
He then turned his attention to a second industry and a new country — selling cars in Cuba. In the late 1920s Strake moved to Havana to start a car dealership (with the idea of perhaps also drilling a well or two in Cuba). After the instability of oil exploration, he wanted a stable economic foundation. In those days Ford, the dominant car manufacturer, made only black cars. Henry Ford’s famous saying in the 1920s was, “Any customer can have a car painted any color that he wants so long as it is black.”24 Strake saw this as an opportunity. He believed he could sell colored cars in Cuba from other manufacturers. As it turned out, it was a very good idea at a very bad time. The Great Depression, in addition to a collapse in sugar prices, settled over Cuba, and there was little interest in buying cars of any make or color. After running through most of his fortune, Strake told Susan that they needed to get out of Cuba before they had to “swim back.”
The Strakes next intended to move to Oregon to enter the more stable lumber business. Susan’s mother in Houston became sick, however, and they returned there. Susan, no doubt, was pleased with this decision, as she was well loved in Houston with a wide circle of friends. Ultimately, their relocation to Houston would change their lives … and the lives of a great many other people as well.
George Strake loved to roam outdoors, using hunting or a similar excuse, while Susan nursed her mother. One area he explored near Houston lay east of the small town of Conroe, about forty miles north of Houston. During his explorations, he noticed two strange things. First, in an area southeast of the town, cattle and other livestock would not drink the brackish water. Second, in the same area, all creeks and rivers in the area of Conroe flowed northeast, moving against the southeast current of most local creeks and rivers. Thousands had gazed upon these irregularities and seen nothing, but Strake saw in them signs of a vast underground oil field. The topography and geology reminded him of the Mexican wells he had worked with near Tampico. Curious, he leased 8,500 acres at a cheap price. He took his theory and his prospect to eight different large oil companies for financing. They were not impressed, and all summarily rejected him as just another hopeless visionary peddling a sure dry hole. He had no geological staff, no exploration department, and no real track record in the United States. He had no seismic or torsion balance data. For over a decade, well after well had been drilled in the area — all without exception producing dry holes. The area was a graveyard of shattered dreams and broken companies. Strake later said the oil companies thought he was just a crazy lone wolf wildcatter, but he believed he was a “team of two” with God’s help. For a long time, his proposal remained an unlikely joke to everyone except himself.
Finally, he approached Susan, told her he thought there was oil, and asked her permission to invest the very last of their money in drilling the wildcat prospect — still in the depths of the Great Depression. Although another failure like Cuba would leave them destitute, Susan agreed, expressly conditioned on thrifty George’s promise to never again question anything she purchased if he hit oil.
George drilled, but hit only natural gas — a booby prize almost valueless in the early 1930s. In order to keep his leases in effect and to generate revenue for more drilling, Strake turned to a friend, W. T. Moran, a fellow Catholic (and also from the Midwest). Moran started a small refinery and filling station on the Houston-Dallas Highway to strip liquids from Strake’s gas and refine and sell it as gasoline. Surviving and extending his leases on shoestring gasoline sales from one small filling station, Strake drilled a second time, with his last dollars, deeper than anyone else had drilled — nearly a mile below the earth. He hit a vast underground ocean of oil at five thousand feet deep. As it turned out, the Conroe field was an immense pool of oil sitting under a massive cap of natural gas. The geological story of its creation under the ocean over fifty-five million years ago is little short of miraculous. It was the third largest oilfield ever discovered at that time in the United States — an immense elephant field in industry slang. Strake instantly became one of the wealthiest men in the world. His brave wife, Susan, much loved in Houston, quickly became a famous shopper in Houston, New York, and Paris.
As would often happen with Strake, his discovery also made many others around him incalculably rich. As just one example, in later years, as natural gas escalated in value, Moran’s right to buy the gas escalated from a single gas station into a vast fortune of utilities and pipelines, rewarding Moran many times over for his belief in Strake. A marker on the lawn of the courthouse at Conroe commemorates how Strake and his great discovery carried Conroe safely through the Great Depression and made it the “Miracle City.”
On the morning of January 12, 1933, in the space of thirty seconds, George and Susan almost became poor again very quickly. Two wells operated by other companies in the Conroe Field burst into flames and then exploded with the force of a nuclear explosion. The flames could be seen many miles away. The burning wells then exploded underground and cratered, producing an immense hole swallowing up many rigs in a seemingly bottomless pit. Even after the flames were extinguished through explosives, the field continued to pour oil and gas into the six hundred-foot-deep crater, causing pressure in the remainder of the field to drop. Strake’s fortune hung by a thread.
His luck held. Strake found an engineer named George Eastman who claimed to be able to stop the out-of-control holes. For the first time in oil history, Eastman drilled holes in an intentionally slanted direction (as opposed to vertical), stopping the intrusion.
