A leading Texas oiman let Rep. Jim Wright (D-Tex.), the House majority leader, in on a private gas-well deal in East Texas at the same time that Wright was using his influence to try to save a multimillion-dollar investment in the Middle East by a company partly owned by the oilman's family, it has been learned.
Wright said that Richard Moncrief of Fort Worth invited him to invest in the well in February 1979, while Wright was involved in a personal campaign to recover the $102 million investment that a Moncrief-related company had made in territory that Isreal was to turn over to Egypt under the Camp David peace accords.
Wright denied that Moncrief's invitation to him to share in the well-drilling venture, their first business deal together, was related to Wright's efforts on behalf of the family's company.
"The implication is insulting," Wright said. "Of course not. Of course not." What he did in this case "is simply illustrative of the effort he customarily extends for large and small businesses and private individuals from his area who come to him for help," according to a statement released yesterday by his office.
In March 1979, Wright took the extraordinary step of hand-delivering a letter to Egyptian President Anwar Sadat asking for his assistance in protecting the interests of the Moncrief subsidiary, Neptune Oil. Earlier, Wright had approached the administration on the oil company's problems in the Middle East.
Wright did not report his investment in the well as such on his 1979 financial disclosure statement, but indicated the purchase in April 1979 of an interest in the company that was operating the well, Texas Oil and Gas Corp.
The investment in the well, in Freestone County about 80 miles southeast of Dallas, was set up for him by Montcrief, who also participated in the venture with other members of his family, three other Moncrief employes, and the Dallas-based Texas Oil and Gas. Wright, put up about $35,000 in the deal, he said in an interview.
Wright said that he made his first payment of the drilling costs in May 1979. He said he listed the investment on his disclosure report as an April 1979 acquisition because that month was the "general area" in which the investment was made.
Records on file in Texas indicate that the well was begun Feb. 2, 1979, and completed on March 27, 1979. Wright said he was not sure exactly when the well was drilled, but that he did not receive a bill from Moncrief for costs associated with the well until sometime in May.
The drilling turned out to be successful. The well was tied into a pipeline on June 18, 1979, according to an attorney for Texas Oil and Gas. In December the well was producing 24 million cubic feet of natural gas per month, according to Texas state figures. In May, the latest month for which figures are available, the well would have brought in about $40,000 at the ceiling price for new gas.
W. A. (Monty) Moncrief Sr. and his son, W. a. (tEx.) Moncrief Jr. held about 18 percent interest in the property, which was put together by a Dallas oil consulting firm.
Richard W. Moncrief, the grandson of W. A. Moncrief Sr., arranged to take over the family's share of the deal and distribute it among six other family members and friends, including Wright.
Richard Moncrief could not be reached for comment.
"When this deal came along my grandson, R. W. Moncrief, wanted to take the deal and let some of his friends in on the deal," W. A. Moncrief Sr. said Monday. "Jim Wright just happened to be here at the same time and he took an interest in it."
Lease documents, which were filed in Freestone County in January, indicate that Wright got one-fifth of the Moncrief's 18 percent share in the well, giving Wright a 3.6 percent interest in the well's production.
Wright initially put up slightly more than $19,000 for his first installment on drilling costs, he said Monday. He later paid about $16,000 more for development costs.
Some of the money that Wright used for the investment came from a loan he obtained from Continental National Bank at Fort Worth, W. A. Moncrief Sr. said. Wright's financial disclosure statement lists a a loan from the bank in the amount of $15,000-$50,000.
Moncrief, 84, is the founder of Moncrief Oil and the patriarch of one of Texas' oldest oil families.
In 1976 the firm joined another, larger Texas independent producer, Superior Oil Co. of Houston, to form Neptune Oil.
Neptune signed a contract to develop the El Tor field, off the tip of the Sinai peninsula, for Israel in 1976, Oil was first discovered there in late 1977.
But under the terms of the Camp David treaty negotiated in September 1978 and signed in March 1979, Israel had to return the field to Egypt in November 1979. To the oilmen at Moncrief in Fort Worth, that was too soon for Neptune to be able to recover its investment at the prevailing oil prices. f
With the help of Wright, the Moncriefs managed to arrange meetings with the Egyptians to discuss getting a share of the action when the property was transferred.
But Egypt already had contracted with Amoco Oil International to develop the El Tor field and would not renegotiate.
So Wright took the Moncreif's case to the administration, calling then Secretary of State Cyrus R. Vance, trying to bring pressure to bear on Amoco and the Egyptians to negotiate with Neptune. But Amoco refused, preferring to leave the matter to the Egyptians.
Finally, Wright wrote a letter to Sadat which began, "Egypt could benefit greatly over the next three years if your government will encourage your oil concessionaire, the Amoco Company, to cooperate with the Neptune Company . . . ."
On March 28, when Sadat was in Washington for the signing of the peace accords, Wright handed him the letter in a private cloakroom meeting and asked him to look into the matter.
"Mr. President," Wright said, "this is a matter I would appreciate if you could focus upon. It has to do with developing the oil potential in the Gulf of Suez."
Neptune eventually did recover its investment in the oil field before it was turned over the Egyptians on Nov. 25, not because of Wright's efforts but because of rapidly rising world oil prices.