Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-08-06
INVITATION IN OIL
INDUSTRY IS URGED
U. S. Officials Study Opera.
ton of Pools in ConSer-
walton Inquiry.
BY BENNETT WOLFE,
Associated Press STAFF Writer.

TULSA, Okla, August 6.-Unit oper-
alton of oil pools, plan which Govern
ment officials are studying this week for
proposed application TO the Kettleman
Hills field in California, where the
United States has 80 per cent of the
holdings, is regarded by leaders of the
petroleum conservation movement as
offering permanent remedy Tor the OIL
tnduStry's economic ills.
Unit operation, also called utilization,
is plan designed for stopping competl-
tive drilling drainage, which is consid-
cred the beginning of the industry S
troubles because of the attendant waste
full practices and results. Unit opera
ton calls for cooperative development
of an area through pooling OF acre
age. eliminating haSty and eXtraVagant
drilling with an excessive number of
wells and dry holes
Government Endorsement.
Endorsement of the plan came from
the Government recently In the enact
ment of law permitting unit operation
of pools on lands in which Uncle sam
owns interests The measure was spon-
sored by the Interior Department in an
effort to conserve petroleum resources
and to eliminate waste. Previously the
hoard of directors of the American Pc
troleum Institute had approved the
plan. IT,. =.
William N. Davis, vice president oil
the institute and chairman OF It's OIL
vision of production, has been one OF
The most Jealous advocates of unitiza-
ton. He is vice president OF the PnA-
lips Petroleum Co.
CUNT operation" he said, attacks
the industry's economic AIS at CheI
source. and through the elimination or
reduction of competitive drilling Dram
age offers the one sane and sound pro-
gram for their correction.
He explained the principal economies
of the unit system were anecteo oy
DEVELOPMENT of pool with one-han or
one-third the. number of wells COM
monty drilled and with reduction IN
tha number of dry holes. He is author
ity for the statement that unitlZatlon
would have saved the oil industry more
than $500, 900 900 in development OF the
Seminole field in Oklahoma. known in
its heyday as the, Worlds Wonoer
Pool"
2. B. Reeser. president of the Ameri-
can Petroleum Institute and the Barns
dali CORPORATION, regards the general
adoption of the unit plan as mevlta-
BILE"
Orders Called Palliative.
Frank Phillips. president of the Phil
Inns Petroleum Co, believes application
to the advancement of utilization OF
the same cooperative spirit which mas
made possible curtailm and proratlon
agreements will hasten the time when
cIIrtailment and proration agreements
will not be needed.
Declaring the oil industrys Ills were
adsen-seated and chronic" Harry ID.
Smith. general secretary OF the MID
Continent Oil g. Gas Association, de-
scribed proration orders as ''pailiatives'
not cures"
The industry's ills" he continued,
ssrnay be eliminated only by fundamen-
tai change in the methods and practices
of oil production whereby separate m
lividualistic holdings and activities are
merged into undivided, co-operatiVely
managed interests whereby the oil pool;
as distinguished from the mdiVlduai
lease, shall become the competitive unit.
It is the conviction Of many sincere
students of petroleum economics that
this new method of organizing expiora-
ton, development and operation, Whlcn
Is called utilization is the one prospec-
tive accomplishment which may be re-
lied upon to yield that economy OF de-
yelopment and operation, more complete
recovery from the sands and stability OF
output which are conceded to be essen
tial
CHI na=;ra