Rigged for success
Rising oil prices lift some companies higher and faster than others.
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| An Arena rig on the Fuhrman Mascho field |
(FORTUNE Small Business) -- As multinational corporations race to pursue oil worldwide, a small Tulsa-based firm is striking black gold state-side. Arena Resources (ARD) landed at No. 1 last year on the FSB 100, our list of America's fastest-growing small public companies. Arena, which explores and drills for oil and natural gas in Kansas, New Mexico, Oklahoma, and Texas, increased revenues from $60 million in 2006 to a little more than $100 million in 2007. "We've set new growth records each year since 2000," says CEO Lloyd Rochford.
Arena's sales have risen with the price of crude oil, which has danced around $100 a barrel since January. The firm bought properties with both medium- and long-term growth prospects, says Phil Dodge, an analyst with the Stanford Group in Boca Raton. "I don't think other oil companies realized that the business was going to get this good," he adds.
Arena's most lucrative land buys have been in the Permian Basin, which spreads across West Texas and southeastern New Mexico. Arena found its sweet spot there in the Fuhrman Mascho oilfield, where it drilled nearly 300 wells last year. Rochford says Arena has tapped less than 25% of the area's potential.
The CEO, 60, added 40 employees last year, and is expanding Arena's in-house geology and engineering teams to explore new purchases. While the firm's reserves will take it through the near future, maintaining Arena's growth will be a challenge, Dodge notes. "There are too many companies in the game now."
Rochford says Arena owes its success to polite and persistent work with small landowners. "When we ask them to consider selling us property," he says, "they respond." But some investors would probably credit the firm's leadership. Rochford, whose stock options were recently worth a bit less than $10 million, earns a yearly salary of $36,000 and no bonus. "Arena is managed by talented people who will share in the pie as it grows. It's a sensible way to run things," says Dodge. 
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