The San Francisco call., 1905-06-08
Great Deal Goes Through
by Which Standard and
Railroad People Secure
Control of Oil Trade
C0ALINGA COMPANY
AGREES TO RETIRE
Stock Is Deposited With
Bank i'm Escrow Under an
Option to Purchase at
Large Advance in Value

a AoI - AuA dllOC III d11C
BY a master stroke the Standard Oil
Company and the Southern Pacific Com
pany yesterday eliminated the competi-
tion put UP by the Coalinga Oil and
transportation Company in the trans
portation and marketing OF California
petroleum <rom fields north of Te-
hschapi The Coalinga Company con-
strucred and has operated a pipe line
from the oil fields 20 the coast at Mon
uerey, where connection has been made
by vessel for san Francisco and other
ports OF the world. This line cost its
projectors 100000 approximately. but
y has been good investment for its
owners and thorn in the sides of the
transportation lines and the Standard
Oh Company. Only q threat on the
part Of the Standard Oil Company 10
parallel the Coslinga pipe line TO Mon
terey was needed 10 bring about a deal
Of great Importance 10 those concerned
and also Of concern TO the general pub
lie
The net earnings OF the Coalinga
Company have averaged $4,000 a
month ever since the Monterey pipe
line was completed and put into use.
The cost OF moving oil 10 Monterey has
not been greater than that incurred. per
oarrel, IN moving tie same commodity
10 tide water on the bay OF San Fran
cisco by the Standard Oil Company, via
pipe line, which is estimated at cents
per barrel. AS the Southern Pacific
Company charges four times that rate
10 bring OIL 10 this city by rail, and as
the Standard OIL Company has a large
interest in controlling the entire oil sit
uariOu in this State. the competition
that was brought into existence by the
CoalinEa Company became a serious
consideration for both OF the large cor
pCrarions that have moved on the
C0alinga-
The situation has been talked over
with vigor and some heat. The Coal
lnga Company. having a good thing in
The monthly mex earnings Of so. .00G. was
satisfied 10 have tne existing status
continue indefinitely. The Standard Oil
Company and the Southern Pacific Com
pany determined 10 get a compromise.
sale or 10 crush their newest rival in
Transporting oil Yesterday all the
stock OF the Coalinga Oil and Trans
porlation Company was put in escrow
in bank in this city and an agreement
was executed binding the Coalinga cor
poration TO sell out under an option
that runs until July J.
For the stockholders Of the Coalinga
Atfl-l A.ctlA y L0 AAHDEE DuL seventeen
all told. the deal was not bad thing
financially. The terms Of the agree
ment gives them three dollars for every
one they have invested In addition
they have shared in the earnings of
$4,000 a month for some time
LEADING STOCKHOLDERS.
The three largest stockholders Of the
company thar agrees TO sell are William
Matson, ship owner; the Crocker-w Wool
worth Bank and S b Pauson OF the
Hub clothing house OF this city.
The deal was brought about with as
much secrecy as possible Probably
the news VIII greatly surprise the people
Of Monterey and, not less, the ship
pers Of oil from the Coalinga district
The evident intention Of the transpor-
tatiOn lines and the Standard oil 10
cut out all competition in this State
by one device or another. has previous
~ been made manifest in a striking
way
A few years ago the Associated Oil
Company was formed in California
with a capitalization Of $4,000. 600.
MS company represented the pooling
OF interests Of more than a score of
strong producing companies that
were unable singly. TO hold their own
in the sharp competition in the fuel
OIL market. All their plants were ap-
praised. their pipe lines. their capacity
10 produce, the value OF their product
etc To each Of the former companies
that made the merger was issued an
amount Of stock and bonds of the
Associated Company in payment for its
former holdings on the basis Of the ap-
pralsement- A much greater competi-
ton than was in the power Of the Coal
inga OIL and Transportation Company
70 make was IN sight, seemingly, at
least
TACTICS ARE POWERFUL.
To bring the Associated OIL Com
pany's product 10 tide water on San
Francisco Bay z pipe line. some hun
oreds OF miles long was proposed. An
attempt followed TO raise the money
10 construct the pipe line by the sale
OF bonds in the New York market
Publications that worked in the inter-
est OF the Standard Oil Company gave
10 the public statements that were
damaging 10 the hopes OF the Asso-
ciated OIL No means was neglected to
prevent the sale Of the Associated Ou
Company's bonds They were not sold.
and, consequently the pipe line to the
bay was never constructed.
Then the Southern Pacific Company
came next on the scene and began to
purchase stocks of the companies in
Guided IN the Associated Oil Comoan1-
The railroad people are now popnlariv
supposed To be in actual control OF the
Associated OIL Company
The sale OF the Coalinga Monterey
pipe lire may signify the end of com
petition in the construction of pine
lines 10 serve the oil fields north of
Tehachapi in reaching the coast bv
their own means OF transportation. The
sale viii undoubtedly be completed on
July J. when the option for purchase
viii expire.
Don't Use Poor ofT