Los Angeles herald., 1910-09-16
PROMINENT OPERATORS
OPPOSE CONSERVATION
0rcutt and Garfield Take Sides
Against Issue on Ground
of Mere Theory

The prominent oil operators, namely
w. W. Orcutt of the Union Oil COM
pany and c. A. Canfield, an associate
of e. L. Doheny, when asked concern
ing their views on conservation OF oil
on the public domain, both expressed
themselves as opposed to the leasing
system advanced as a part of the
posterity theory.
Mr.. Orcutt voiced the sentiments of
many of the operators in his statement.
The Union OH company is the oldest
producing oil concern in the state.
Some of it's wells in the Sespe district
of Ventura have been producing oil for
twenty-seven years. The company is
reputed to have assets totaling $780,
900, 900. Mr.. Orcutt said:
1.-THE presidents plan is undemo-
cratic and would open the door to all
sorts of class legislation. The Califor-
MIA oil operators should not be forced
to pay royalty to support the govern
ment. The plan would shut out the
poor man absolutely. Under the min
eral location plan he must actually
produce oil to get title. There is no
way to do that except by sinking a
WELL All the shallow sand territory
has been taken up and all that is
available is in deep sand territory,
where you have to drill 5000 feet or
are wildcats, pure and simple. In such
territory a we'll can be put down for
$4,000, barring accidents. If the pros
pector does not strike oil he gets moth
ing, though he had paid many times
the price of the land for agricultural
purposes.
1.-THE only fair way is to quit listen
ing to theorists and allow the pros
pector to acquire title under the old
,s,,sr lrxr s.a1, 10 ittG Ia
with a few amendments would give a
boom to the oil industry
lone recent decision is that man
cannot file on oil lands unless he has
made a discovery of oil. 1t makes
location prohibitive. For instance, If
ten men were to drill on the same quar-
ter section, the man who got oil first
could claim the whole 100 acres, in
flicting a total loss on all other opera
tors
''I believe that out of this agitation
we will get a sane law that will give
an impetus to the oil industry of Cali
fornia."
C. A. Garfield, one of the largest
operators in the state and an asso-
ciate of E. L. Doheny, takes much the
same view of the situation. Taft S
royalty plan,' said he, would put an
unfair burden on the new operator as
holdings. 1t requires thousands to de-
velop new fields Take the Lakeview
gusher The owners had put in more
than $4,000 without getting any oil.
Then they called on the Union Oil COM
pany Oil company for aid and got it by
giving a good share of their interest
and holdings. Under the government
plan those men would have lost their
all, for capital will be slow to invest in
holds a mortgage on prospective
profits.
"The government should have started
in at first charging one-eighth royalty
and then all operators would be equal.
This plan puts too much burden on new
men and new capital and will retard
development"
S. C. Graham, who is one of the
largest operators of this state, agrees
with President Taft on the royalty
proposition. Its only fair" said he,
that the operator should be willing to
pay the government as much for a
lease as he is willing to pay some pri-
vate owner. Not per cent of the oil
claims that have been patented have
ever been developed by the locators.
They sell the leases. The government
should advertise all property that is to
be opened to entry and give the choice
location to the highest bidder.
"The president is wrong in trying to
fix one-eighth as a royalty. In prac-
tice it is much less in territory far
from producing property, where the
operator takes all the risk. Instead OF
a royalty there should be graduated
charge a barrel on production"
From another source it was learned
that many of the leases of the Union
Oil company pay only one-twelfth roy
atty, and that also is all the royalty
paid by the Graciosa company in the
Santa Maria field.