Albuquerque daily citizen. [volume] (Albuquerque, N.M.) 1895-1903, 1902-05-02
BIG OIL DEAL.
The Santa fe Invests 0ver a Million
Dollars in Kern River Oil Fields.
DEAL MADE BY RIPLEY.

The details of the Santa Fe's big ST.
500 900 deal in oil have just been made
public, and will be of interest to all
railroad men, says the Topeka State
Journal. The Santa Fe is about to
take over the holdings of the Petro-
leum Development company a corpor-
alton controlling nearly $500 acres sit
uated u the Kern river field about
eight miles north of Bakersfield. Part
of the company's holdings Is owned in
fee. and the rest is held on long time
lease. Experts estimate that not less
than one-third of the total is proved
oil-bearing territory. The company's
lands are capable OF producing $4,000
barrels a month. The output has ex-
ceeded 10000 barrels, that amount be-
ing the requirement necessary to meet
the company.s demands because of a
five-year contract entered into with
the Santa Fe little more than two
years ago.
Shares at s11 Each.
Edward l.. Doheny, Godfrey Hotter
hoff, the late w. G. Nevin, of Los An
geles, and A. b. Butler, OF Fresno, in
cluded the original owners of the Pc
troleum Development company. Addi-
tional stockholders. who will partici-
pate in the proceeds of the sale to the
Santa Fe include III. M. Mcintosh, of
Chicago and w. A. Bissell, assistant
traffic manager of the Santa Fe, of San
Francisco.
1t is understood the cash price for
the property will be $l,270 900. or on a
basis of about sl1 share. The capt.
talization of the corporation is $125,-
900. Revenues allowed to the sellers to
| 81 lar -fx.-
swell the purchase figure to 81 1,415, 900.
| 1t is understood four stockholders
will be beneficiaries in the sale. The
| fortunate quartet includes f. l.. Do
heny. A. B. Butler, w. A. Bissell and
H. NJ. Mcintosh. Transfer of the prop
erty was effected through e. l.. Doheny
of Los Angeles, who first obtained an
option on all the stock outstanding and
then did business with President Rip
ley direct.
The deal has been hanging fire since
last November, experts having been
sent from Santa Fe headquarters in
Chicago and Los Angeles in order to
make inventory of the property. The
examination was concluded last week,
and the titles having been found per-
feet the first cash payment in the deal
will be made at once from Santa Fe
headquarters in Los Angeles. e. L..
Doheny will obtain two-thirds OF the
purchase price, the remainder to be dl-
vided among Messrs. Butler, Bissell
and Mcintosh. The sale is the most
important cash transaction OF its de-
scription ever made in California.
President Ripley was induced to take
the property because of the contract
with the Petroleum Development com
pany providing that the Santa Fe Rail-
way company should take its entire
production.
There Is Money In Oil.
The fuel sold. for nearly two years,
has aggregated 10000 barrels a month
at 90 cents a barrel. Oil can be pro-
duced at 10 cents a barrel. after de-
| Quoting interest and other charges, eff
/ fecting net profit of so cents barrel
/ to the Santa Fe. 1t is estimated that
at the price paid for the property by
| the Santa Fe, the company will earn
! three-quarters of the money by the
| time the five-year contract at 9S cents
/ a barrel shall have expired.
When the Petroleum Development
company was organized in the summer
of 1899, only 100000 of the $l25,OOO
capital was paid in, and some OF the
original promoters in the enterprise
were taken in at about l6 cents share
/ for their holdings. The company, since
| its organization. has paid out 100000
as profits and surplus, returning to
some of the investors about 460 per
! cent in two wears