Carbon black is produced from "sour" gas-natural gas that contains more than 1½ grains of hydrogen sulfide or more than two grains of sulfur per hundred standard cubic feet. Although J. K. Wright, a Philadelphia ink maker, discovered the process of manufacturing carbon black in 1864, it was little used until improved technology in the twentieth century reduced the high cost of production. After 1915 carbon black became widely used as a reinforcing agent in the production of automobile tires. In early 1923 the first Texas plant for manufacturing carbon black by burning residue gas from gasoline plants was constructed in Stephens County. Two other plants were erected in the same county later that year; together the three plants annually produced 2,633,013 pounds of carbon black valued at $184,306. Carbon black production was limited to Stephens and Eastland counties until March 11, 1926, when the Railroad Commission permitted the Phillips Petroleum Company to build a plant in the Panhandle for the casinghead gasoline plants in Carson and Hutchinson counties. This plant, initially run by the Western Carbon Company, was later owned and operated by the Columbian Carbon firm. By 1926 there were seven carbon black plants in Stephens County and two in Eastland County, as well as the one in Hutchinson County; that year Texas produced 20 percent of the nation's output of carbon black. In 1928 the Cabot Carbon Company established the first of several plants near Pampa, and in 1931 a plant was erected at Big Lake. Such corporations as Coltexo, Texas-Elf Carbon, Peerless Carbon, and United Carbon continued to expand and sometimes established their own company towns in more remote areas to house employees and their families. In 1931 thirty-one plants in Texas produced 210,878,000 pounds of carbon black, or 75 percent of the nation's output. In 1937 forty Texas plants, thirty-three of them in the Panhandle, produced 82 percent of the nation's carbon black; the Panhandle plants alone yielded 405,247,000 pounds. Plants were also operating in Winkler and Ward counties during the late 1930s and 1940s. By the close of World War II there were forty-two carbon black plants in the state, including one at Bunavista, west of Borger, built shortly after the Japanese bombing of Pearl Harbor.
During the 1950s, when eighty-eight billion cubic feet of gas were burned annually to produce carbon black, Texas retained its position as the nation's leading carbon black producer. In 1954 thirty Texas plants with a total daily capacity of three million pounds were located in eighteen counties and produced 65 percent of the nation's total carbon black. Rubber companies absorbed most of the total production; smaller quantities were used as pigments in ink and paint. Production continued to be concentrated in the Panhandle, although some carbon black plants were built along the Gulf Coast. Major locations included five plants (four furnace-type and one channel-type) at Borger, two furnace-type plants at Big Spring, and two plants (one furnace-type and one channel-type) at Seagraves. Other plants were located at Skellytown, Baytown, and Aransas Pass. Of the two methods of production, channel and furnace, the latter was becoming more popular by the 1960s.
In 1964 the industry recovered 1,165,593,000 pounds of carbon black valued at $86,494,000. Thirty-nine plants employed 1,954 persons and had a value added by manufacturing of $29,957,000. The total daily capacity of Texas carbon black plants had increased by that year to 3,945,300 pounds. By 1969 Texas carbon black production was valued at $110,816,000.
The 1970s and 1980s saw a general decline in the number of carbon black plants, due mainly to the decrease in output of natural gas. This was particularly true of the Panhandle, where by the 1980s only a few plants near Pampa and Borger remained in operation. Even so, Texas remained the largest producer of carbon black. In 1973 the state produced 1,511,127,000 pounds of carbon black, valued at $128,144,000. By 1981 only 3,213,899 cubic feet, or about .05 percent of all the natural gas in Texas, went to produce carbon black. In 1984 carbon black was manufactured from 2,456,809 cubic feet, or .04 percent of Texas natural gas.