Cleveland daily leader. [volume] ([Cleveland, Ohio]) 1865-1873, 1866-02-14
Oil Profits,

Iron the observations of "one who has been
there."]
= I have, fer some length Of time, given
nv undivided attention to the oil bust
ness, especially in developing territory.
The statistics below are therefore derived
from personal experience and observation
in the oil region of Venango county, and
may be relied upon as correct:
First-In regard to the expense of put
ting down an oil well. Where L nave
been operating it may be set down at
$4,000 on an average; no two wells cost
the same. The depth of boring and dis
lance from railroad communication very
materially affect the expense.
Second-The cost Of operating the
wells after oil has been found also depends
upon circumstances. Coal in the district
in which L nave been working, costs from
Sl,1O to $3.50 per bushel, and from twelve
to twenty bushels are required per day,
owing to whether the engine is portable
or stationary-the latter consumes
all of twenty bushels in twenty-four hours.
I pay two men four dollars per day each
sometimes they make as high as eight days
in the week, by means Of over-work, so
that you can readily see that twenty dol
lars per day is the minimum cost OF the
labor and other expenses of a pumping
we'll; and unless the well produces over
ten barrels il will not pay to pump it, I'M
less it is snear a railroad or river for
transportation and Government tax eat
up the profits of the well, unless oil is
selling at a high figure, and when half the
| oil is given as a royalty, less than a TWEEN
ty-barrel well will not pay the owner for
working it. These statements are based
upon the operations in Venango county.
There are wells in other districts in
which at shallow depths, lubricating oil is
obtained, which brings in the market
from $40 to $40 per barrel, of which a
much less production will yield a profit.
Third-Were every well a success, the
cost of putting them down would be Il
small matter; but when it is taken into
consideration that not one well in twenty
five returns the cost TO its owner, it will be
seen that the average cost of producing
is very heavy. From my observation and
experience, l believe l am safe in saying
that more money has beer sunk in the oil
business than has ever been realized, and
that every gallon of oil taken from the
ground mas cost, in the aggregate, more
than received for it. Last winter l in
vested in the petroleum stock, and, with
the expectation of making my invest
ments a sure thing, L divided them among
nine different companies, and yet not one
out of the whole munger has succeededin
obtaining a paying well, although at
least twenty-five wells have been struck
and about 100000 expended. My OBJ
servations in the oil region during the
last six months have convinced me that
these companies are not exceptions, but
come under the rule. I have stood in
front of my office, near Plummer, in
Cherry Run, and within the compass OF
my eye, from a rough calculation, have
estimated an expenditure in oil operations
of 81, 500, 900 to So, 900, 900, without the
return of one dollar. Even in the Pithole
region I have heard it estimated that not
over one in twenty wells has produced
oil.