The Dawson news. (Dawson, Ga.) 1889-current, 1911-05-31
THE STORY If ITS DEVELOP
MENT FROM A PIGNIY INTO
: AN OCTOPUS.
IT HAD EARLY DIFFICULTIES

The Genius and Farsightedness of
John ID. Rockefeller Were the Ba-
sis of Its Marvellous Success. Com
pany Has sos, zoe, 900 of Unen-
numbered Stock,
The trust which the highest court
in the land has ordered dissolved
the Standard Oil Company in
corporated in August, 1882, and re-
incorporated on June IA, 1899, I'M
der the laws OF New Jersey. At that
time it's capital stock was iEcreas-
ed from $10,000,00O to 500, 0OO,-
O00 OF common and $10,000,000 pre-
fefred. The latter has been retired.
The present outstanding stock is
$98,3SS,3O0. There are no bonds
against the company.
The origin of the oil industry in
the United States dates from the
drilling of what is known as brakes
we'll on August 28, 1859. Among
the first men to realize that the in
dustry would eventually become an
important one was John d. Rookie
Teller While running small re-
finery in Cleveland in 1865 he saw
that unless he combined his capital
and energy with other men in the
same business all of them were like
ly to fail. Accordingly he united in
one firm the other four refneries
controlled by himself, William Rock
efelleT Mr.. Andrews, S. Y. Hark-
ness and H. M. Flagler.
From this combination of men
there was formed in 1870 the Stand
ard Oil Company of Ohio with a cap
itaI of 100000. These four re-
fineries in Cleveland thus started
what is the Standard Oil Co. of
New Jersey today. At the same time
that Rockefeller and his associates
were developing the business in the
west w. C. Warden was doing the
same in Philadelphia, LOckhart in
Pittsburg, and Charles Pratt in
Brooklyn. In 1872 these men COM
bined forces with the Rockefeller
combine and formed what was
known as the Standard Oil "Alli-
ance, which ten years later was
made the basis for the Standard Oil
Trust
Early Difficulties.
The difficulties besetting refners
in 1865 were chiefly such as could
be cured by an increase in capital.
In 1861 the best wells were 80 miles
from the railroads, and, owing to diff
fculties in transportation, the price
of petroleum at the wells had fallen
from $40 a barrel to almost nothing.
Two years later boats had begun car
Uying the crude oil, and small pipe
lines and branch railways had been
built. In 1866 more efficient re-
fning method had been invented,
and the tank car had begun to re-
place the old fiat cars with their
wooden tubs. These changes called
for much more capital than any of
she oil men could command unassist-
ed, and resulted in Mr.. Rockefeller's
determination to organize the lead
ing producers in a union
The years from 1865 to 1870 de-
termined the most efficient unit of
production, while the next seven
years brought lower costs Of trans
pOrtatiOn Large refineries soon be-
gan to manufacture their own bar
vels, cases and materials used in the
manufacturing processes. In 1875 a
method had been found for utilizing
great deal Of the waste product
BY an act of the Pennsylvania leg
islature the South Improvement Co.
was created in 1871 OF the 1000
shares 900 were owned by II. NJ.
Flagler, o. H. Payne, William Rock
efeller, J. H. Bostwick and John D.
Rockefeller. This company soon eff
fected favorable contracts with the
Pennsylvania, New York Central and
Erie railroads, under which the oil
company got rebates, while outsiders
paid regular rates. knowledge of
this aroused great Indignation
throughout the oil region, and be-
fore the South Improvement Co. had
an opportunity to enjoy the benefits
Of its arrangement the Pennsylvania
legislature summarily destroyed it's
charter.
Whips Railroads Into Submission.
In 1870 the Standard OIL Company
controlled four per cent Of the pro-
duction of the oil regions. Two
years later the capital Of the Stand
ard Oil Company of Ohio had been
increased to $3,5O0,000, and the con-
troll OF the Alliance" had been ex-
tended over more than half the re-
ining industry. From 1874 to 1877
the company devoted itself to acuuir-
ing control Of pipe line These be-
came involved in a war with rival
railroads, with the result that in
1874 freight charges from Chicago
to the seaboard fell from 81 to 10
cents New York Central and Erie
l0st millions, while the Baltimore