As to the future, it is full of promise. There is no doubt that for many years to come the full force of foreign competition, as it has existed in previous times, will not be felt. There is a free field for Scottish enterprise in connection with the distillation of its oil-bearing shales. Nor is the region for development limited to its present area. Reports point to the fact that much area of commercial ground exists, not only on the eastern side of Scotland, but also in the north and north-west, while it is already an open secret that those responsible for the conduct of Government operations are viewing with favour even the liquid extraction of oil from certain areas not far distant from the zone of the present operations. The Scottish shale-oil industry has, so far, managed to defy competition from abroad to an extent which is reflected in the balance sheets of the several operating companies, whose yearly dividends have been from 50 per cent. downward during recent years.
One thing is certain, and that is, the Government is well aware that there are great possibilities associated with the shale-oil industry of Scotland, and it is not only watching developments with direct interest, but is doing all in its power to foster the industry, and by all means possible encourage the exploitation of areas so far not commercially developed. At some future date there is a great possibility that the present area for developments will be largely extended, and as this is written, there is much evidence forthcoming to suggest that this commercial development of new lands will not long be delayed.
CHAPTER XIII
A FEW NOTABLE PETROLEUM ENTERPRISES
No brief survey of the petroleum industry would be complete were reference not made to a few of those remarkable commercial undertakings in various parts of the world whose interests are not only closely associated with it, but to whose energies has been due much of the expansion that has been witnessed in every direction during the past few decades. It is safe to assert that, had it not been that the petroleum industry has, in its various industrial and commercial aspects attracted the attention of some of the finest financial and business houses in the world, the wonderful progress which has been recorded would, for the most part, have been impossible.
The first place must of necessity be given to that much maligned amalgamation of capital, the Standard Oil Company of New Jersey, which was formed as far back as 36 years ago by Mr. John D. Rockefeller and his associates for the primary purpose of developments in the petroleum industry of the United States. At that time, the petroleum production of America had become quite a factor in commerce, but it was, obviously, in want of a guiding hand which could not only place it upon a basis of solidity, but which would tend to remove much of that gambling element which had become almost part and parcel of all developments. The Company, at the head of which were several gentlemen who had already made themselves famous in the land of oil, launched out in several directions, and, through the numerous subsidiary concerns which it soon created, it owned very extensive oil-bearing properties in practically every oil-field of the States, while it built quite a network of pipe-lines for the conveyance of the oil from the fields to the refineries, and from the refineries to seaboard. It erected and equipped oil refineries, and, so as to provide the much-needed foreign markets for American petroleum products, it built its fleet of oil tankers; and, lastly, opened depots for the distribution of American petroleum products all the world over.
At one time, the ultimate success of its vast operations was open to question, and many there were who predicted that one day it would ignominiously pass on to the list of oil failures. Indeed, it nearly came to this on one or two occasions, and it was only owing to the remarkable perseverance of those at the head of the Company’s affairs that prevented headlong disaster. The Standard Oil Company soon became an integral part of the petroleum industry of the United States, with which it grew up and steadily assumed a position of world-wide importance, though one which was not unassailable. Its ultimate success was the chief cause for the multiplication of its critics, and volumes have been written of its wrong-doings by writers whose knowledge of the petroleum industry was mostly based upon wilful ignorance of facts. Consequent upon a decision of the United States Supreme Court some seven years ago, which held that the Company was violating the Anti-Trust Law of 1890, the Standard had to rid itself of its various subsidiary companies (over thirty in number), but it still controls almost a similar number of concerns to-day which are actively engaged in the production of crude oil and natural gas. It also owns several of the largest refineries in the States, while its fleet of oil tankers will, when present building is completed, be considerably over 300,000 tonnage. Its capital is $100,000,000, and during the last twelve years it has paid in dividends over 400 per cent., in addition to an additional cash distribution of 40 per cent.
The Standard Oil Company of New York is another immense concern which, with a capital of $75,000,000, has its headquarters in the Standard’s palatial building at 26 Broadway, New York, and interested principally in the refining industry, its facilities permitting of 20,000 barrels of crude oil being treated daily. Another very prominent company is the Standard Oil Company of California, with its capital of $100,000,000. This Company not only produces its crude oil, but refines it, and engages in the export business. Its refinery at Point Richmond, California, is reported to be the largest in the world, for it can treat 65,000 barrels of crude oil daily. Its fleet of tankers and barges for the export trade is capable of carrying at one trip over 100,000 tons of products, and, for the purposes of its land transport, it possesses pipe-lines over 1,000 miles long.
The second place of importance in regard to the petroleum enterprises of international influence must be given to the “Shell” Transport and Trading Company, Ltd., whose headquarters are in London, with that well-known oil pioneer, Sir Marcus Samuel, Bart., as its Chairman. Formed just over twenty years ago for dealing primarily as a transporter of petroleum products in the Far East, the “Shell” has steadily and continuously extended the sphere of its operations, until the result of a carefully thought out policy is seen in its activities in almost every oil-field of the world. Just over ten years ago, the Company made an amalgamation with the Royal Dutch Petroleum Company, or, to give it its correct name, the Koninklijke Nederlandsche Maatschappij tot exploitatie van petroleum-bronnen in Nederlandsch Indie (whose capital is £12,500,000), and by reason of so doing it materially increased its international position and importance. The “Shell”—Royal Dutch Combine to-day has a controlling interest in some of the largest operating companies in Russia, Roumania, California, Mexico, Venezuela, and other oil regions, one of its most recent extensions being in its advent into the petroleum industry of Trinidad. The “Shell” Company has a record for successful industrial expansion which is achieved by few companies in the world of commerce: its capital is now £15,000,000, and in dividends it has distributed over 300 per cent. Among the “Shell” Company’s associated concerns, that of the Anglo-Saxon Petroleum Company, Ltd., which is responsible for the ocean transportation of the petroleum products of the Combine, takes first place, with its capital of £8,000,000; while the Asiatic Petroleum Company, Ltd. (capital, £2,000,000), ranks but second. The recent fusion of the interests of Lord Cowdray with those of the “Shell,” for the latter has acquired the control of the great Mexican interests associated with the Pearson company, is another instance of how the “Shell” Company has trod the road of progress and expansion.
The sudden rise to fame of the oil-fields of Mexico gave birth to what may safely be referred to as one of the most enterprising amalgamations of capital in the long list of concerns associated with the petroleum industry, and it is gratifying to note that this enterprise was solely due to the well-known firm of Messrs. S. Pearson & Sons. Lord Cowdray, as the head, was not slow to recognize the vast opportunities which awaited the development of the Mexican fields, and the formation of the Mexican Eagle Oil Company, in 1908, with a capital of now $60,000,000 (Mexican), or about £6,125,000 sterling, was the initial result of his efforts. It was just about this time that the serious fuel oil era opened, both in this country and others, and it was evident that, for the purpose of adequately distributing the products of Mexican oil (and these include the whole range of refined oils, as well as fuel oil), there was room for the operations of a large and influential company. The Anglo-Mexican Petroleum Company, Ltd., was accordingly formed, with Lord Cowdray’s son (the Hon. B. C. Pearson) as Chairman, and a capital of £2,000,000, to deal with the importation and distribution of Mexican petroleum products on the English market.
As already stated, the control of this Company has now passed under the “Shell,” and its future expansion is assured, both at home and abroad.