The New York herald., 1922-06-24
MEXPETEABARGAM
AY50O, ,SAYSD0HENY
Chairman Wonders How
Far Stock Exchange Will
Go in Its Inquiry.
HE IGNORES CORNER
Interest Is in Production
and Success of Company,
He Insists.
TELLS OF BUYING AT 1876
Once Offered to Let Cromwell
Look Into Vaults and Check
Stock Lists.
TELLS OF BUYING AT 1876

III the uSnt OIL LHe lNeW OTh OtOCh
Exchanges failure to do anything to
protect owners of Mexican Petroleum
stock when it was the subject Of a
severe bear raid year ago, shall be
intensely interested to see how far the
exchange authorities will go to pro-
tect those who are reported to be short
of the stock on it's recent SO point
rise"
E. L. Doheny, chairman of the Mexi-
can Petroleum Company and president
Transport Company. made this state
ment yesterday about the Stock Ex-
change investigation to determine
whether there Is a corner in the stock
of the former. He added:
Mexican Petroleum stock has never
sold for so much as one half it's real
value since 1t was listed on the stock
exchange.
Its profits earned in the first three
months of 1922 were SIS share on
its common stock. while it's April
earnings were equal to 81 share on
Its stock. This makes an average of
about $6 a share earned for the first
four months Of the year. or at the
annual rate of nearly $72 a share on
its common stock.
Worth Twice 1894 n Share.
''1n the latter calculation. however.
no allowance is made for possible losses
which may be encountered in the re-
mainder Of the year. Three years ago
when the stock was selling at 1854 q
share l said 1t was worth twice that
amount and I have not changed my
opinion.
1--WE have no knowledge as to whether
there Is short interest or a threatened
corner in the companys stock. Our
chief interest as managers Is to make
the operation of its property a success"
Mexican Petroleum broke to low Of
176 in the days trading. It closed at
that figure for a net loss Of w points
from Thursdays closing and 10 points
from Thursdays high of 1885, The 186
peak had represented gain Of SO from
the 1884 level OF q week ago yesterday.
when the bull movement began.
Asked whether the Pan-American
Petroleum and the Huasteca Petroleum
companies. which own about 73 per
cent. of Mexican Petroleum stock. had
increased their holdings of the stock.
Mr.. Doheny said there had been no
change since the Huasteca company
purchased 17.400 shares in the early sum-
mer of 1921 at from $l20 to $14S a share
Regarding the floating supply Of Mexi-
can Petroleum stock, Mr.. Doheny said
the company's list of stockholders as
of June u.s. 1922. showed the parent
companies to be the owners of $4,000
shares. leaving a balance Of 117,0Ol
shares held by scattered investors.
offered Books for Inquiry.
Mr.. Doheny asserted that in July. 1921.
he wrote to Seymour l.. Cromwell. pres
jdent OF the New York Stock Exchange,
suggesting that the latter appoint a
committee of Los Angeles bankers to
enter the vaults of the Pan-American
Petroleum and Transport Company in
that city and examine fully the Mexican
Petroleum stock certificates held by
that company. The dates. numbers and
other data Of the certificates would
show. wrote Mr.. Doheny. that Pan
American had held its stock intact since
the date of issuance and that none Of
it had been transferred sold or lent
This letter was written at time when
Mexican Petroleum stock was being
driven down and the heavy trading in
the stock gave rise to reports that the
Pan-American company was liquidating
its holdings.
On December 20, 1921, the Pan-Ameri-
can Company yielded to request of
the New York Stock Exchange authori-
ties and agreed not to sell any of it's
holdings of Aiexican Petroleum stock
without first notifying the Stock Ex-
change.
Mr. Doheny branded as utterly i'm
moral" the bear raid which took Mex
Pete down in 1921 on the circulation Of
reports that salt water had ended the
productivity of its oil properties. With
1t went many other stocks. resulting in
the ruin Of many investors and specu-
lators some of whom were driven to
suicide.
At that time Mr.. Doheny said he was
under the impression that few IL any of
the employees of the company were In
terested in its stock. An examination Of
the company's stock lists, however, led
20 the discovery that large number of
its employees were carrying the stock
on margin with brokers who were on
the bear side of the market and whose
interests therefore were opposed directly
10 that Of their customers In the stock
Most Of them were employees on the
company's properties In Mexico and
were in position to know that its earn
ing power was sound.
Fo the rejection OF these EMPLOYEES
the companyS directors voted 5000 900
TO take up these commitments.
Paid More Than S1s5 In 1910,
Mr. Doheny said that in the spring of
1919 he bought 1920 shares of Mexican
Petroleum stock at prices between sls5
and sl95 a share. This stock he later
exchanged for Pan-American at two
for one.
About vhree years ago Mr.. Doheny
visited the company's Mexican proper
ties in company with DR.. I. c. White.
expert geologst. and a party of bankers.
Mr. Dohenys belief was that the fields
TO be inspected held about 1.0oO, 900, 900
barrels of oil. but at the close of the
tour DIR. White gave II as his opinion
that the fields were capable of produc-
Yns from 5000, 10000 to 100000. 900 bar
rels.
In these fields within the last two
months the company has brought in
nine wells. all of which. Mr.. Doheny
said. might be called gushsrs, with a
total daily capacity of from 10000 to
10000 barrels of oil. From other pools
the company has taken approximately
Ee.000,000 barrels since October. 1921.
with the new wells, Mr.. Hoheny said,
the company's producing capacity was
easily 100000 barrels daily.