Not so many fast bucks on Denver 'penny' market

Say the word ''oil'' and it brings to mind the Rockefeller Standard Oil Trust and the Seven Sisters (the giant American oil companies).

Yet there is another, less publicized aspect of the petroleum industry. This is Little Oil: the nation's community of independent oilmen who as individuals, or in small companies, play the high-stakes, high-risk game of finding and developing America's vital oil and natural gas reserves.

As Denver grows in status as an energy center, more and more of these independents have been setting up shop. Today somewhere between 2,000 and 3,000 independent oil operations have headquarters here.

Who are these people? About half are geologists. About half have worked for big oil companies.

Many hail originally from Kansas, where a multitude of small, shallow oil pools were conducive to small operations. Some of them are cautious, continually attempting to minimize their risks. Others are reckless, willing to bet their last dollar that a well will come in.

''Those who don't have pretty rugged psyches don't stay in this business long ,'' says John Parker, president-elect of the American Association of Petroleum Geologists and considered one of the ''big idea men'' in the business. While working for Standard Oil of Indiana in Wyoming in the 1950s, Mr. Parker was responsible for finding two giant oil fields.

Today he works alone from a skylighted office in his home south of Denver. A trim figure in white shirt and narrow tie, Parker leans back in his chair behind a large hardwood desk. Behind him, the room is littered with geological maps of various parts of the Rocky Mountains.

Oilmen, he says, must be able to see thousands, even millions, of dollars wasted repeatedly on dry holes and not lose their confidence or determination.

''I've recommended many dry wells in my day, but I've found a whale of a lot of oil as well,'' he points out.

Hanging on the wall near his desk are two Charles Russell pen-and-ink drawings which he equates with the career of an independent oilman.

The first is a portrait of a lean, buckskin-clad mountain man. ''He's tough, lean, and rugged, as he must be to survive. Those are the qualities you need to get started in this business,'' Parker explains.

The second drawing is the same man, somewhat older. He has put on a little weight. He is wearing fancy Western clothes and leaning against a counter in a fort. ''Now he's the trader,'' he continues. ''He's had to develop management skills, the ability to work with other people. And he's gotten used to the luxuries of the fort.''

Caswell Silver heads a 300-member operation called Sundance Oil. An impressive figure with a high forehead and wispy white hair, he is casually dressed in a silver string tie and cardigan sweater. He has been an independent for nearly 40 years.

''The oil game is like a detective story,'' Mr. Silver says. ''After all these years I still get a big thrill out of confounding my friends . . . and my enemies.''

Although the years have brought many changes, he maintains there is just as much romance in the oil industry today as when he started. It is the romance of discovery, of finding something new. Searching for oil and gas, he says, is a form of self-expression, a way to be creative.

No matter how advanced the scientific tools a person uses, ''there always comes a point when you have to go with your instincts,'' Silver says.

The fact an independent has a large amount of his own money depending on the correctness of that intuition only adds extra spice to the game. ''Chance favors the creative,'' he is convinced.

In addition to the need for creativity and detective work to identify potential oil and gas reservoirs, small oil men face another set of challenges. This is the aspect symbolized by Parker's trader. Money must be raised, investors or potential partners courted.

Small oilmen form a tight-knit social and business community. It is still a business in which deals are closed with a handshake rather than abstruse legal documents.

''It's not that people in our business are more honest than average,'' Parker says. ''It's simply that there's so much money involved that if someone's crooked he gets talked about and isn't in the business for long.''

These oil entrepreneurs also have a complex relationship with the major oil companies. Independents drill about 70 percent of all the exploratory ''wildcat'' wells in the United States. So in a sense they are the ''exploratory arm'' of the oil industry. Still the oil majors are involved in most of the major discoveries, either by drilling the wells themselves or because they own the leases on the land and ''farm out'' the drilling to an independent.

''I get a real thrill from putting together a deal,'' Parker admits. ''Say you have a 'play' involving six companies. You have a complex situation involving different personalities, different degrees of investment, varying amounts of pride of ownership. It may take hundreds of hours, but it's extremely satisfying to figure out what is good for all the parties, including yourself,'' he explains.

Besides the many challenges involved and the fascination of the game itself, small oil men say they gain a lot of satisfaction from knowing their efforts bring tangible benefits to other people, that the fuel they find helps farmers grow food, turns the wheels of industry, and heats homes.