You could call it Hilcorp Energy’s Oprah moment. One morning in March 2011, Tony Garza, a senior production foreman at the oil and gas company’s South Texas fields, came off the job with a brand-new SUV. Colleen Elkins, manager of planning and budgeting, drove away in a Ford Expedition. In fact 366 of Hilcorp’s 699 employees got new vehicles — and those who didn’t went home with $35,000 — or a prorated portion — in cash instead.
Not bad for a hard day’s work, or even five years of work. Hilcorp’s cash and new-car bonanza — which totaled over $31 million — came as the spoils of Double Drive, a company-wide challenge that promised every employee a choice of a car voucher or cash if Hilcorp doubled its value, production rate, and reserves between 2006 and 2010.
While the campaign struck some in the industry as pie in the sky, at Hilcorp it rallied employees. But big as the bonuses may be, they’re not the main reason people like Garza and Elkins love working at Hilcorp. It’s the culture, or what employees call the “Hilcorp Way.”
Founded in 1989 by CEO Jeff Hildebrand, Hilcorp has grown into one of the nation’s largest private oil and gas companies, with 1,100 employees. Hildebrand also built Hilcorp with particular ideas about the company’s culture, things like encouraging absolute transparency and creating a sense of ownership in employees.
For example, Hilcorp shares everything with its staff: It distributes detailed performance data and goals to all employees at monthly open-book management meetings, access that often startles new hires. In return, Hilcorp expects employees to contribute to decision-making.
And the rewards don’t stop at cars. Employees also get an allowance to invest in Hilcorp projects of their choosing, thereby giving them a stake in the project’s success. And along with Double Drive, the company awards generous bonus pay at a single rate to all employees (the rate averages 35% of base pay a year).
Employees say the result is a workforce that is friendly and free of politics — and largely populated by driven, type A go- getters. “We get things done,” boasts Garza. (In survey feedback employees frequently praise managers for quickly “getting rid of nonperformers.”)
Which is probably why they’re all on their way to collecting even more rewards. Come 2015, the Double Drive bonus is $100,000.
This story is from the August 12, 2013 issue of Fortune.