Montana oil and mining journal. [volume] (Great Falls, Mont.) 1931-1953, 1937-11-06

need for consolidation but nothing came
of it until w. S. Porter, a salesman for
the J. d. Hooker company, pipe dealers,
came to Bakersfield with B. 3. Green
and M. H. Whittier and made a vigorous
effort.
They called in all operators at early
meetings hut these broke up under the
barrage of time-killing oratory of those
who had little or nothing at stake while
the COMPETENT operators remained quiet,
unwilling to engage in the dog-rassle.
1t became apparent that it would be necse-
sary to start an organization with
small group of thinking individuals.
It was then that a group of level
headed producers decided to form an
association. Present at the first for
NAL meeting were a strange lot of oil
men. They included an attorney from
San Francisco, an attorney from Fresno,
a real estate man from San Francisco a
real estate man from Oakland, a farmer
for whom Reedley is named, a vineyard
list from Fresno, a former railroad con-
ductor from Los Angeles and four or five
real oil men including some names now
famous in the industry: G. A. Garfield,
a former mining man, whose associate
was E. L. Doheny, an assayer, and J.
A. Chanslor, who had worked with Can
field and Doheny in a mine in New
Mexico. Chanslor was a former COW
hand and grocery clerk. Ali had hold
ings in the Kern river field and some also
owned land at McKittrick. By the time
they got around to form a company they
had added a lumberman, a banker and
a Vacaville rancher. Thus they turned
their association into a company which
they called the Associated Oil company.
They elected Garfield president, and pool
ing all OF their properties together they
were able, for the first time, to handle
~ He
in the central part Of the field were most
productive and decided upon a plan of
appraisal so that each holder might share
equitably. They hired Bernard Bienen-
field and Arthur M. BEN, biologists, to
draw a map and establish three zones.
They appraised all the land in the field
under these headings. BY that time
some of it was held at $1,000 per acre.
They incorporated for $40, OOO, 900, and
having no cash capital, voted bonds to
about the same amount. The plan was
to take over each mans holdings on a
basis of common stock for the land and
bonds for improvements. After the or
ganization was completed the little OPP
orators in the district were invited to
participate on the same basis. Most of
them did, because oil had become so
plentiful and sales organization was so
poor that 1t sold for as low as NINE
GENTS PER BARREL.
A little over a year after they or
ganized, Garfield, who in the meantime
had joined E. L. Doheny in the latter's
Mexican operations, decided that he could
not continue both interests. He felt the
greater promise lay with Doheny, so re-
signed as president and was succeeded by
J. A. Chanslor, in 1902.
GET RAILROAD
TO BURN CRUDE AT
80 CENTS DBL.
With so great an amount of reserves
and with so powerful an organization,
they were able to step out and create
a market. They approached the South
ern Pacific railway with a proposal that
they would furnish fuel oil for locomo-
tives. Southern Pacific adopted oil bur-
ners and the associated producers found
their first competent outlet-at 80 cents
per barrel. Southern Pacific had been
unable to sell a little acreage at Kern
river and McKittrick, so organized the
Kern Trading and Oil Co. to develop It..
This company was not a competitor,
however, and it bought such shares of
the Associated as came on the market.
The Sante Fe railroad then became a
buyer of fuel oil and to insure itself of
an adequate supply purchased the proper
les Of the Chanslor Garfield Midway
Oil company at Coalinga, thus establish
ing source Of fuel oil for its 1ocomo-
tives in the west
The subsequent growth of the great
Associated Oil company is well known.
1t is the living proof that a group of
operators, when sufficiently pressed, can
lift themselves with their own boot
straps"
In East Texas, when oil dropped to