Gary Peterson Transcribed1.doc
Gary Peterson Transcribed Interview
J: When did you first . . .
G: Well I actually took a class from Tracy in 1968––took a chemistry class––that was my first year at BYU. It was the chemistry class for chemistry majors or chemical engineering majors. It was a five-hour class. It included labs on Tuesdays and Thursdays. He was the teacher for the year, so I had him for two semesters in chemistry. It was an interesting class in a lot of respects. One of the interesting things that happened was when we found out when his invention for making diamond was, and we threw a party for him, and we were supposed to have a test that day, and we didn’t have to have a test because we got him talking about the diamond and what was going on. And he took us over to his high-pressure lab and took us on a tour of the lab so we didn’t have time for that test.
J: So that’s when you found out about his diamond stuff?
G: Well, right, I didn’t know very much about it because I was a freshman at BYU and several members of the class had found out about when he got the first patent so we threw a little party for him and had a cake and stuff. We went over to his high pressure lab and he showed us all the different experiments that he’d been working on and had the old tetrahedral press and had a press that was made out of a landing gear piston. I don’t know where he got it from. It was down on the ground but he took us on a tour of his lab and showed us everything he was doing. It made for a very interesting day and we didn’t have to take the test.
(3:00)
J: So, I know it was a long time ago, what was he like as a teacher?
G: He was an interesting teacher. He had his strengths and weaknesses as a teacher. His strengths were obviously crystals. When we got into the section on crystals he brought in a lot of hands-on stuff and taught us a lot about crystals, and you can tell that was more interesting to him than other things. A big thing for him was to teach us about the periodic chart and the different groups of the periodic chart and we had to memorize all that, and that was kind of a big thing for him because how different chemicals work is based on the groupings of the chart, and so that’s how he tried to teach us chemistry is by memorizing that periodic chart, which was interesting that he had us do that. And, of course, he was in the lab all the time and we were in the lab too. I kind of got a little bit acquainted with him, and in fact that’s when I got acquainted was that year 1968-1969. Then I went on my mission in 1969, and when I came back, I started working on BYU campus. And my bishop was Bishop Pope, and I was looking for another job after me and my wife got married. We were managing a motel and I was looking for a second job to get enough income and started working at Mega Diamond as a press operator. Of course I got to see Tracy periodically in that environment as well. They first started with one press and it was the old 1200 ton press (4:55). It was in a little building down by the river. You had to go down a dirt road, and now of course it’s all built up, it’s not a dirt road anymore,. It’s where Mega Diamond is currently located. It’s the oldest section of that building—It’s the north wing—that was the size of the building when I first started working there, it was just that end of the building.
J: How many employees were there when you first started?
G: There was a lot. There might have been 20 students, a lot of students. There’s always been a lot of students part time working there. They had the one press, and they had two operators on each press, one was the pressure controller, and the other one ran the power. It was the old clay controller, and you had to ??? (6:04) to control the power that way to make a resin bond diamond.
J: How did the company structure work back then?
G: That’s the old DBT company—Dwayne, Bill, and Tracy, and of course Mega Diamond was another--they had several corporations. I never could keep track of it.
Well, DBT owned the press, or owned something. And Mega Diamond owned the building. Mega Diamond was the company formed to sell the polycrystalline diamond. And DBT was the holding company that had a lot of the equipment. I was paid both by DBT and Mega Diamond. I didn’t know who my boss was for awhile.
J: Who oversaw your work there, for the most part?
G: The guy’s name was Howard Howard. H. H. H. was his initials. But also I worked with Bill and Dwayne. Tracy—the first year I maybe saw him two or three times, not often, and after they built the next building, and Dwayne, Bill, and Tracy were supposed to have their offices up front, I saw Tracy maybe once or twice a month was about all.
J: So you started there in 1970 or ’71?
G: Yeah
J: How long were you there?
G: I stayed there through 1990.
(8:34 to 11:05 omitted)
J: He [David] came from Ingersoll to Mega Diamond. There were a few companies, at least, under one roof. Were there just two companies, or were there more than that?
G: There was DBT and Mega Diamond changed the president of the one company. I think there were a couple other minor companies that were in there too. I don’t know. It was kind of confusing.
J: So, Mega Diamond was created over a couple of years.
G: Yeah. Like in 1975 I think was when they built the expansion. And there was Mega Diamond Inc. that was going to market the diamond, and there was Mega Diamond in Utah that was going to manufacture the diamond. Then there was DBT which owned the equipment and some of the land. I don’t really know all those details other than I got paychecks from different entities. But David came from Ingersoll Rand—it must have been close to 1978 or 1979. We started having what I call the Mega Diamond wars. DBT had different stock holders than some of the other companies. They changed the president of the one company but couldn’t change the president of the other companies. So there were lines down the hall—that type of stuff. It was pretty funny.
J: You’ve got at least two bishops, a couple general authorities of the church . . .
G: A former temple president. Different people, and they were trying to figure out who to run the company. The Popes were trying to run it for quite awhile. Dwayne didn’t like how they were doing some of the stuff and got David to help him usurp the Popes.
J: So when David came in, what was his title? I think his dad turned the shares over to him and said, “I’m done.”
G: He came in as president of one of the entities. So I ended up working for Dave for a while.
J: And then Bill was still on the board of directors.
G: Along with Dwayne and along with some of the other people that were still there.
J: And do remember who was made general manager—who took Bill’s position? Was that position filled?
G: Louis was running part of the company for a while too, prior to Dave coming on.
(14:57)
Louis acted as the general manager before Dave came and took over part of the company. It was kind of in that time frame that they were selling technology to the French. I think 1978-80 they were selling technology to the SICN, which was a French company. And then I think it was 1980 when Dave became the president of one of the entities. And finally they convinced everybody to come over, and I guess Dave was pushing the technology for the enhanced insert for Smith, and then Smith in 1982 bought Mega Diamond, and that bought out Bill. And so he was able to take his money and go start U.S. Synthetic, and then they actually brought in a different manager.
J: When did you leave?
G: It was 1990. So I stayed and worked for Smith from 1982 until 1990. They had two different general managers—well, three. Dwayne was general manager for a while with Dave as the manager, and then they brought in Gene Meyers, and then after Meyers it was Wally Kartness. And that’s why I left, because of Wally.
(16:45)
J: I guess a lot of those guys in those initial tussles about who owned the business and who didn’t . . .
G: and who should run it
J: Yeah, it seems like everybody turned out pretty good. (17:07)
G: Well, everybody ended up fine. You look at U.S. Synthetic, and they did really well. And Dwayne was happy with what he got, I think. And of course, Dave’s got Novatek. So they all really survived when you look at the companies, and you look at the amount that Mega Diamond is making, and the amount of money that U.S. synthetic is making, and the amount of money that David is making, it’s probably more than had they stayed together because they pursued different avenues. (17:45)
J: This book is essentially about the beginnings of Novatek too. It will talk a lot about the industry, and that’s why I ask you all this stuff, even outside of Tracy. Is there anything you need to add about Tracy? Did you have any other ??? (18:07)
G: I never had any interactions that were bad. It was always a good interaction. He was always easy to talk to and visit with. And like I said, I was his student and got good grades from him, so I was happy. Freshman Chemistry that first year was kind of a hard year, but it was a good year. I enjoyed those classes. And I had a lot of fun. And those afternoon labs—they were three hour labs on Tuesdays and Thursdays—sometimes it was four or five hours. He was always approachable, easy to talk to, easy to get information from.
J: What was your position at Mega Diamond before you left? (19:12)
G: When I left I was the manufacturing manager for all of Mega Diamond’s products. For a while I was a product manager, for the grit product lines. So I developed metal bond. Resin bond they were doing when I started working there. I developed metal bond diamond for them and sold that for years. Then when I left I was managing all the production areas, all the manufacturing areas. (19:50). We did the polycrystalline diamond at four presses when I left. And I worked for Jim Hone (20:02) to get approval from Smith, right before I left, to build their P4 press, which is what they’re still running. They have several of those P4 presses, but it was really Jim Hone’s and my design. I designed the sale for that. So I learned on the little press and went to the R1 press. Then I developed the M2 press and then the M3 press, and then the P4. So I did a lot of the engineering. But in working with Dave and Dwayne and other people. (20:42)
J: Is there a resource for those presses where I could go just look at the development really quick?
G: I don’t know. When I left Mega Diamond, I left a lot of stuff there. But, I couldn’t take any of it with me.
J: While you were at Mega Diamond under Bill or Dwayne or Tracy’s watch, and then eventually David’s, you were running a press . . .
G: I started as a press operator, and then when I graduated in 1975, they offered me a job full-time, and I was actually already supervising the lapping department at that time (21:26). So the diamond finishing for Mega Diamond, I developed one of the processes for that in 1973-75, and then I developed the metal bond product line 1975-77. Took the resin bond product line—we were at one time, I estimated we had about 50% of the market share on resin bond. And then we had maybe 20% on the metal bond before it started declining. What happened was that the prices of diamond when I started working at Mega Diamond was $2.25 for resin bond to maybe $2.50 And when I left Mega Diamond the price for resin bond had dropped down to $.35 a carat. (22:20)
J: What was behind that?
G: GE and DeBeers did not want to give up market share, so we just drove the prices down. As we started gaining market share they would drop their prices, and we’d gain a little more, and they’d drop it a little more. It was kind of the diamond wars. We did resin bond diamond, and we got up to maybe 70% of that market for a little while, and then we did metal bond and got up to 20-25% of the metal bond market before they wouldn’t let us have anymore and drove the prices down, and that’s really what drove Mega Diamond to get into the polycrystalline diamond business harder, and made it possible for when David came on ??? for the oil business (23:12) and so there was really the decision made in that 1978-80 time frame that we’re not going to stay in business if we try to sell grit, because every time we try to compete with GE and DeBeers, they’d just drop their prices. And so the decision was made that we had to go after polycrystalline diamond hard and the enhanced insert was the development. (23:36)
J: So was this the PCD?
G: Yeah, the polycrystalline diamond. The enhanced insert was for the roller cone bits—the oil bits. And that development worked from 1978-81 is what allowed Mega Diamond to sell themselves to Smith, and so that decision to get out of the grit business forced the development of the polycrystalline diamond and to make the shape parts which was new and unique. (24:16)
J: What was the field that PCDs were used for in the beginning? Was it for drilling?
G: No, Mega Diamond--that was the New York corporation that was formed to sell the polycrystalline diamond--initially they tried to go after the tooling market—non-ferrous tooling machine. And, so they made little rounds, little triangles, positive and negative tooling that we actually made to machine, like aluminum or copper or other parts like that. And then they went after the oil industry in a big way. Mega Diamond still sells tooling for the non-ferrous markets. But oil, by far, is the biggest market for the polycrystalline diamond. (25:22) That’s why we’re looking at selling it at the asphalt planning, to try to figure out how to get it to work better.
J: Was Mega Diamond ever competing with U.S. Synthetic?
G: When U.S. Synthetic spun off in 1982, they started first in grit too, and that was the other thing that was driving the market down, is they tried to sell grit. And everyone in the world was copying GE’s high pressure technology that Tracy had developed—the belt press. (26:01)
J: So is GE still using belt presses?
G: Oh yeah, they still use them today. And, so all the nations of the world like Germany and France, and China and India and Russia, and everybody—the first thing that they started making was diamond grit, which is resin bond. And so everybody in the world is trying to make it because they consider diamond a strategic material, and so that contributed to the decline of those prices as well. (26:36)
J: So did U.S. Synthetic essentially ??? like Mega Diamond did when they decided to ??? (26:57)
G: Yeah, they spun off and they designed a press and Louis and his dad designed a press and built one or two of them and started making grit, and tried to make polycrystalline diamond and tried to make a business, and they ended up selling some presses the same way Tracy used to sell presses to get money. They kept developing different stuff and trying to get in the marketplace. And for a while they tried to compete directly with Mega Diamond on the tooling product line. I don’t think they did very well there. It was really oil--they linked up with a couple of companies in the oil patches and built custom polycrystalline diamond parts for them. That’s what made them grow. (27:51)