Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1906-09-29
SMALL CONCERNS
PAY FOR PLANTS
5s.1
ELABORATE SCHEME is WORKED
IN THE SOUTHWEST BY THE
STANDARD OIL COMPANY
Kansas and Indian Territory Made
Scenes Of Greatest Slaughter
Prices are Steadily Hammered
Crush Values of Their Competitors.

pendent OH producers have paid for all
sthe5 pipe lines and all the reflneries
sof the Standard Gil company in Kan
sas and Indian Territory. There is a
little left over for incidentsls and 9TH
er expenses
The Standard oil people estimate
their investment in, Kansas and the
territories for pipe lines, wells pump
Ing stations and the like at s20,O00,000.
They do not pay taxes on that much,
but that is what they assert has been
expended by them in the development
of the oil field in this part of the
World. With the Sugar creek refinery
Included, the investment of the STAN
Sdard Oil company will run approxi-
mately $25,000,000. Against this is an
individual and independent corporate
investment of more than $4,000, 900.
s This is the amount Of the cash put in
to wells pipe lines, refineries and the
I. like.
Two years ago the Standard was
paying $13S per barrel for the highest
grade OF kansas-territory OIL Now It
Is paying SO cents per barrel for the
same oil. Two years ago the average
price paid by the Standard at the we'll
was $1.2b. Today the average price
paid by the Standard is 80 cents per
barrel. This is a reduction of 95 cents
per barrel.
some 100000 barrels per day. the
difference in price means $66.50o per
day. In one year this runs more than
k250.000. In one year the Standard
would be within less than 100000 Of
paying for its entire establishment in
Missouri, Kansas. Indian Territory and
Oklahoma, and have the original in
vestment, unimpared, as a present
from the Independent producers.
Reducing independent Values.
j Not onlv is tn eStandard Oil COM
pany paying more than 80 per cent
per annum on the entire capital 1t
has invested in the southwest, but 1t
has reduced the value of the holdings
Of the Independent producers to an
enormous extent. BY some people this
depreciation in value of investments
is estimated at so per cent, but more
conservative operators place the fig
ures at from % to 30 per cent. The
reason is plain: The value Of produce
Ing properties is governed by the value
OF the product and when the Standard
Oh company, by virtue of it's strangle
Mold on the market, Is able to reduce
prices below the cost Of production, it.
reduces the value of the producing
properties correspondingly. Oil leases
which were paying handsome divi-
bends TWO years ago are now strug-
disappearing, and unable to g.t The
banks to carry them when the surplus
!. Is EXHAUSTED, for the banks are the
Est institutions to get cold feet on
a t,ec'if.!nE market.
Producers would hold their oil if
they We're able, but they are not able
to provide the necessary storage Dur
Ing the boom days in the field there
was proposition to divide storage for
several million barrels. but the agents
of the Standard in this territory at
that time pooh-poohed the idea and
promised that the Standard would
keep the price at living figures, and
would provide all the storage neces-
: sary to take care OF all the oil pro-
duced in the field Producers believed
This. and the money which would have
gone to the building of storage tanks
went into further development Con-
sequently, when the price started on
the toboggan the producers found
themselves at the mercy of the Stan
dard, and the lower the price the less
able they have been to protect them
selves. Now, with ruin staring them
the face. in great many districts
i the oil fields. the producers are alb
olutely helpless. Their only hope IS
The independent refneries, and these
are taking but a small percentage Of
the total output. To the credit of the
iildspcuuellt TeIlHerleS, however, 1t
ought to be stated that they are paying
40 cents barrel more for the crude
oil than the Standard is paying for
the same OIL.
Scene Of Greatest Slaughter
1t is a fact commented on by pro-
lcers that there has been no such
laughter anywhere in the country as
las been made in Kansas and the ter
ritories. The heavy crude Of the Tex
as fields. which does not possess half
the refining value of Kansas territory
oils, is 20 cents barrel higher in the
open market; and Ohio and Indiana
pills, which are much more expensive
to refine because of the presence #
the sulphur, are quoted at two and a
half times the price Of Kansas oils.
Nor can it be said, in justification Of
the reductions, that Kansas-territory
oils have decreased in grade They are
Just as good for refining purposes to-
day, as shown by the gravity test, as
they ever We're.
DIES ON OPERATING TABLE