Roy M. Huffington, Independent Oilman, Is Dead at 90
July 17, 2008
Roy M. Huffington, an independent oilman who defied oil industry precedent by signing an unusually generous deal with Indonesia, made a fortune on natural gas there, then became United States ambassador to Austria, died on Friday in Venice. He was 90.
His death was confirmed by Ralph Dittman, his son-in-law. Mr. Huffington, who lived in Houston, was vacationing when he died.
Mr. Huffington was something of a legend in the world’s oil patches and boardrooms. His father, an oilman, died in an accident when he was 14, so Roy had to get up at 4:30 a.m. to deliver papers to help pay family bills.
He earned a doctorate in geology at Harvard, then hit oil in 17 of the first 18 wells he drilled. He suspected that there might be natural gas in Indonesia, he once said, because its geology seemed to resemble that of the Gulf Coast.
He gave to hundreds of charities and Republican campaigns, including those of his son, Michael, who won a Congressional seat in California but lost a senatorial bid there.
The political commentator and blogger Arianna Huffington is a former wife of Michael’s. In an essay on her Web site, the Huffington Post, she called Roy Huffington “an oilman when oil exploration was still a romantic endeavor.”
Mr. Huffington was nonetheless not a prototypical wildcatter. He spoke softly and intellectually, never wore a cowboy hat and was chairman of the Asia Society in New York and the Salzburg Global Seminar, which brings together prominent people to share ideas.
Mr. Huffington came to prominence at a time when producing countries were seeking more control of their own petroleum resources. Previously, oil companies, mostly the giant ones called majors, had demanded ownership of the reserves they found and produced. The companies then paid the producing countries royalties and taxes.
Mr. Huffington, by contrast, made a deal to share the revenues from any oil and gas his company found, The Oil and Gas Journal reported in 1984. And rather than hoard expertise and technology, something countries had long accused the majors of doing, Mr. Huffington shared them. Indonesians thus learned to run their own fields.
Big companies fought back with money. “If the majors don’t like what you wanted to do, they just didn’t put up the money and that, they thought, would stop you,” Mr. Huffington said in an interview with Forbes in 1977.
Mr. Huffington himself raised money by bringing in other independent oil companies as partners. He helped persuade Japanese utilities to pay for a pipeline and a plant to convert gas to liquid form, or LNG. He persuaded the United States to subsidize building tanker ships.
In a typically prudent step, he even joined forces with a major, Mobil Oil Indonesia, to expand the size of the Indonesia natural gas project. Mobil, now part of Exxon Mobil, then renounced ownership of the gas reserves and accepted the same deal as Mr. Huffington, called production sharing.
One result of the partnership was to prove that extracting natural gas from remote areas could be profitable when it was converted into liquid at extremely low temperatures. It could then be shipped by sea.
After seven years of operation, the project produced enough gas to meet the fuel requirements of the equivalent of eight cities of 500,000 people and made Indonesia the world’s largest LNG supplier.
The project increased Mr. Huffington’s personal net worth to more than $300 million, by Forbes’s estimate, when he sold his businesses to the Chinese Petroleum Corporation in 1989.
In 1990, when his old friend from the oil patch President George H. W. Bush, asked him to be ambassador to Austria, he accepted, and served for three years. He worked to improve business ties with the former Soviet bloc.
Roy Michel Huffington was born in Tomball, Tex., on Oct. 4, 1917. After tiring of being called “Michelle,” he later changed his middle name to Michael. He graduated from Southern Methodist University as a geology major in three and a half years. He earned his Ph.D. from Harvard in 1942, then spent three years in the Navy on an aircraft carrier in the Pacific.
For the next decade, he worked for Humble Oil, the precursor to the domestic unit of Exxon Mobil. He set out on his own in 1956, having saved enough money to survive for three years. For 18 months, he did not make “a red cent,” he said, but then he began to strike oil.
His wife of 58 years, the former Phyllis Gough, died in 2003. He is survived by his son, Michael, of Los Angeles, Boston and Houston; his daughter, Terry Huffington, of Houston; and four granddaughters.
In the interview with Forbes, Mr. Huffington said he liked drilling for oil because of his fascination with geology. “It’s good to peel back the earth and see the history of the world,” he said, adding that by comparison, “our lifetimes are but a fraction of a second.”