Smyrna times., 1937-02-25
OIL COMPANY'S
BIG EARNINGS
Sun Oil Company Reports
1886 Income of S7,563,554,
Against S7,1OO,239 in '35
EARNINGS S3.44 SHARE

Sun Oil Company reports for
1886 net income of $7,563, ,554
equal, after preferred dividends, to
S3.44 a share on 2,023,119 shares
of common stock outstanding De-
cember Is, 1886, prior to distribu-
tion of 6 per cent stock dividend
on that date. In preceding year
company reported net income of
$7,10O,23 ]. Howard Pew, presi-
dent, in his report to stockholders
presents a reassuring of the out
look for future petroleum supplies
to meet the country's rapidly
growing requirements. After re-
ferring to the fact that at the end
of 1886 the number of motor We
hicles in the country-28, ,27O, 900
was an all-time high, that the con-
sumption of gasoline, lubricants
and kerosene set new all-time
marks and that the demand for
fuel oil and gas oil gained even
more, Mr.. Pew continues: ITO
meet these unprecedented demands
slightly over 1,089,00O,000 barrels
of crude were produced in 1886
and about 5O3,0OO,Oo0 barrels OF
gasoline. Careful authorities esti-
mate an increase of from to 10
per cent in the demand for petrol
cum products in 1887.
Facing such heavy requirements
for crude, the industry has in re-
cent time given increasing atten-
tion to the question of future sup
plies. For many years there have
ben periodical warnings about the
possibility Of future petroleum
shortage, supported by widely
varying estimates of proven re-
serves in the ground. The earlier
estimates of this kind have all
been proved by experience to have
been hopelessly conservative. In
recent years advances in petroleum
geology and geophysical science
have made much more satisfactory
calculations possible. Probably
the most thorough approisal OF
proven reserves was that made by
an expert committee for the Amer
lean Petroleum Institute late in
1885. 1t concluded that as of jan
uary 1, 1885, these reserves
amounted to 1917, 900, 900 barrels
In the next two years 2,079,000,00O
barrels were taken from the
ground. On the other hand, many
new pools were discovered and
proved up during these two years
aiding to the reserves.
"A new estimate is being made
as of January 1, 1887, and it will
probably show slight change since
1935-possibly a small increase.
We regard these A. P I. estimates
as the most accurate that have
ever been made. They are un-
doubtedly conservative, for meth
DDS of recovery are constantly be-
ing improved, increasing the pro-
prtion of oil that is recoverable
from the earth. AS is well known,
no process short of actual mining
has ever recovered nearly all the
oil from the sand But in recent
years recoveries have been crafty
increased by representing with
gas and air and by water-fiooding.
These methods have been CONNER
cially successful in a number of
areas and will be increasingly en-
ployed whenever the price incen-
tive warrants. During 1886 the
company increased its crude re-
serves by about 100000 barrels.
1t drilled for itself 275 wells and
participated with others in drilling
33. Of the wells drilled exclusive
ly for the Sun Company, 233 were
oil wells, seven gas wells and 35
dry holes. The total cost of these
wells was S5,7S4 900 or S5.07 per
fot. It is interesting to note that
the approximate footage of wells
drilled and wholly owned by the
Sun Company was 1,136,9O0 feet
or approximately 215 miles. The
company has developed production
on it's Nome dome in Jefferson
county, Texas, where it has a large
acreage; but the development has
not progressed far enough to de-
termine the full value of this area.
The company had other important
developments on large areas in
South Texas where it has already
developed a very large gas supply
with some saturation of OIL At
the beginning of 1887 our estimat-
ed underground reserves were
somewhat over 100000, 900 barrels,
as against 17s,655, 900 at the be-
ginning of 1885,"