20 Things You Somehow Missed In There Will Be Blood
4. The Narrative Importance Of The Burning Derrick
The burning well is an extremely important scene for the film, both in terms of Daniel's characterization and the plot.
Once he finds the oil underneath the lands, Daniel knows he has in his grasp all that he has worked on for the past few years. With this, he can be an "oil magnate". As far as the characterization goes, we see Daniel conflicted with a choice.
Choosing between H.W. and the burning well. His decision to sit outside and take in his "discovery" shows his fundamental drive. It is not to say that Daniel does not care about his son at all. But this scene shows where his priorities lie. The pleasure he takes in watching the fire unmasks his hypocrisy and exposes the true Daniel Plainview that has been hiding behind his sweet child and family-man image.