The History of the Standard Oil Company

by Ida M. Tarbell

PORTRAIT OF JOHN DAVISON ROCKEFELLER IN 1904		[Frontispiece 1]
	Born July 8, 1839.
		FACING PAGE
PORTRAIT OF E. L. DRAKE		[1008]
	In 1859 Drake drilled near Titusville, Pennsylvania, the first artesian well put down for petroleum. He is popularly said to have “discovered oil.”
THE DRAKE WELL IN 1859—THE FIRST OIL WELL		[1010]
FAC-SIMILE OF A LABEL USED BY S. M. KIER IN ADVERTISING ROCK-OIL OBTAINED IN DRILLING SALT WELLS NEAR TARENTUM, PENNSYLVANIA		[1034]
FAGUNDUS—A TYPICAL OIL TOWN		[1034]
PORTRAIT OF JOHN D. ROCKEFELLER IN 1872		[1040]
PORTRAIT OF W. G. WARDEN		[1053]
	Secretary of the South Improvement Company.
PORTRAIT OF PETER H. WATSON		[1053]
	President of the South Improvement Company.
PORTRAIT OF CHARLES LOCKHART		[1053]
	A member of the South Improvement Company, and later of the Standard Oil Company. At his death in 1904 the oldest living oil operator.
PORTRAIT OF HENRY M. FLAGLER IN 1882		[1053]
	Active partner of John D. Rockefeller in the oil business since 1867. Officer of the Standard Oil Company since its organization in 1870.
PORTRAIT OF THOMAS A. SCOTT		[1060]
	The contract of the South Improvement Company with the Pennsylvania Railroad was signed by Mr. Scott, then vice-president of the road.
PORTRAIT OF WILLIAM H. VANDERBILT		[1060]
	The contract of the South Improvement Company with the New York Central was signed by Mr. Vanderbilt, then vice-president of the road.
PORTRAIT OF JAY GOULD		[1060]
	President of the Erie Railroad in 1872. Signer of the contract with the South Improvement Company.
PORTRAIT OF COMMODORE CORNELIUS VANDERBILT		[1060]
	President of the New York Central Railroad when the contract with the South Improvement Company was signed.
PORTRAIT OF JOHN D. ARCHBOLD IN 1872		[1074]
	Now vice-president of the Standard Oil Company. Mr. Archbold, whose home, in 1872, was in Titusville, Pennsylvania, although one of the youngest refiners of the Creek, was one of the most active and efficient in breaking up the South Improvement Company.
PORTRAIT OF HENRY H. ROGERS IN 1872		[1088]
	Now president of the National Transit Company and a director of the Standard Oil Company. The opposition to the South Improvement Company among the New York refiners was led by Mr. Rogers.
PORTRAIT OF M. N. ALLEN		[1110]
	Independent refiner of Titusville. Editor of the Courier, an able opponent of the South Improvement Company.
PORTRAIT OF JOHN FERTIG		[1110]
	Prominent oil operator. Until 1893 active in Producers’ and Refiners’ Company (independent).
PORTRAIT OF CAPT. WILLIAM HASSON		[1110]
	President of the Petroleum Producers’ Association of 1872.
PORTRAIT OF JOHN L. McKINNEY		[1110]
	Prominent oil operator. Until 1889 an independent. Now member of the Standard Oil Company.
PORTRAIT OF JAMES S. TARR		[1122]
	Owner of the “Tarr Farm,” one of the richest oil territories on Oil Creek.
PORTRAIT OF WILLIAM BARNSDALL		[1122]
	The second oil well on Oil Creek was put down by Mr. Barnsdall.
PORTRAIT OF JAMES S. McCRAY		[1122]
	Owner of the McCray Farm near Petroleum Centre.
PORTRAIT OF WILLIAM H. ABBOTT		[1122]
	One of the most prominent of the early oil producers, refiners and pipe-line operators.
FLEET OF OIL BOATS AT OIL CITY IN 1864		[1136]
PORTRAIT OF GEORGE H. BISSELL		[1146]
	Founder of the first oil company in the United States.
PORTRAIT OF JONATHAN WATSON		[1146]
	One of the owners of the land on which the first successful well was drilled for oil.
PORTRAIT OF SAMUEL KIER		[1146]
	The first petroleum refined and sold for lighting purpose was made by Mr. Kier in the ’50s in Pittsburg.
PORTRAIT OF JOSHUA MERRILL		[1146]
	The chemist and refiner to whom many of the most important processes now in use in making illuminating and lubricating oils are due.
PORTRAIT OF A. J. CASSATT IN 1877		[1184]
	Third vice-president of the Pennsylvania Railroad in charge of transportation when first contract was made by that road with the Standard Oil Company.
PORTRAIT OF GENERAL GEORGE B. McCLELLAN		[1184]
	President of the Atlantic and Great Western Railroad at the time of the South Improvement Company. General McClellan did not sign the contract.
PORTRAIT OF GENERAL JAMES H. DEVEREUX		[1184]
	Who in 1868 as vice-president of the Lake Shore and Michigan Southern Railroad first granted rebates to Mr. Rockefeller’s firm.
PORTRAIT OF JOSEPH D. POTTS		[1184]
	President of the Empire Transportation Company. Leader in the struggle between the Pennsylvania Railroad and the Standard Oil Company in 1877.
WOODEN CAR TANKS		[1212]
BOILER TANK CARS		[1212]
WOODEN TANKS FOR STORING OIL		[1212]
RAILROAD TERMINAL OF AN EARLY PIPE LINE		[1212]
PORTRAIT OF E. G. PATTERSON		[1248]
	From 1872 to 1880 the chief advocate in the Oil Region of an interstate commerce law. Assisted in drafting the bills of 1876 and 1880. Abandoned the independent interests at the time of the compromise of 1880.
PORTRAIT OF ROGER SHERMAN		[1248]
	Chief counsel of the Petroleum Producers’ Union from 1878 to 1880. From 1880 to 1885 counsel for the Standard Oil Company. From 1885 to his death in 1893 counsel of the allied independents.
PORTRAIT OF BENJ. B. CAMPBELL		[1248]
	President of the Petroleum Producers’ Union from 1878 to 1880. Independent refiner and operator until his death.
PORTRAIT OF JOSIAH LOMBARD		[1248]
	Prominent independent refiner of N. Y. City, whose firm was the only one to keep its contract with the Tidewater Pipe Line Company in 1880.

THE HISTORY OF

THE STANDARD OIL COMPANY

CHAPTER ONE
THE BIRTH OF AN INDUSTRY

PETROLEUM FIRST A CURIOSITY AND THEN A MEDICINE—DISCOVERY OF ITS REAL VALUE—THE STORY OF HOW IT CAME TO BE PRODUCED IN LARGE QUANTITIES—GREAT FLOW OF OIL—SWARM OF PROBLEMS TO SOLVE—STORAGE AND TRANSPORTATION—REFINING AND MARKETING—RAPID EXTENSION OF THE FIELD OF OPERATION—WORKERS IN GREAT NUMBERS WITH PLENTY OF CAPITAL—COSTLY BLUNDERS FREQUENTLY MADE—BUT EVERY DIFFICULTY BEING MET AND OVERCOME—THE NORMAL UNFOLDING OF A NEW AND WONDERFUL OPPORTUNITY FOR INDIVIDUAL ENDEAVOUR.

One of the busiest corners of the globe at the opening of the year 1872 was a strip of Northwestern Pennsylvania, not over fifty miles long, known the world over as the Oil Regions. Twelve years before this strip of land had been but little better than a wilderness; its chief inhabitants the lumbermen, who every season cut great swaths of primeval pine and hemlock from its hills, and in the spring floated them down the Allegheny River to Pittsburg. The great tides of Western emigration had shunned the spot for years as too rugged and unfriendly for settlement, and yet in twelve years this region avoided by men had been transformed into a bustling trade centre, where towns elbowed each other for place, into which three great trunk railroads had built branches, and every foot of whose soil was fought for by capitalists. It was the discovery and development of a new raw product, petroleum, which had made this change from wilderness to market-place. This product in twelve years had not only peopled a waste place of the earth, it had revolutionised the world’s methods of illumination and added millions upon millions of dollars to the wealth of the United States.

Petroleum as a curiosity, and indeed in a small way as an article of commerce, was no new thing when its discovery in quantities called the attention of the world to this corner of Northwestern Pennsylvania. The journals of many an early explorer of the valleys of the Allegheny and its tributaries tell of springs and streams the surfaces of which were found covered with a thick oily substance which burned fiercely when ignited and which the Indians believed to have curative properties. As the country was opened, more and more was heard of these oil springs. Certain streams came to be named from the quantities of the substance found on the surface of the water, as “Oil Creek” in Northwestern Pennsylvania, “Old Greasy” or Kanawha in West Virginia. The belief in the substance as a cure-all increased as time went on and in various parts of the country it was regularly skimmed from the surface of the water as cream from a pan, or soaked up by woollen blankets, bottled, and peddled as a medicine for man and beast.

Up to the beginning of the 19th century no oil seems to have been obtained except from the surfaces of springs and streams. That it was to be found far below the surface of the earth was discovered independently at various points in Kentucky, West Virginia, Ohio and Pennsylvania by persons drilling for salt-water to be used in manufacturing salt. Not infrequently the water they found was mixed with a dark-green, evil-smelling substance which was recognised as identical with the well-known “rock-oil.” It was necessary to rid the water of this before it could be used for salt, and in many places cisterns were devised in which the brine was allowed to stand until the oil had risen to the surface. It was then run into the streams or on the ground. This practice was soon discovered to be dangerous, so easily did the oil ignite. In several places, particularly in Kentucky, so much oil was obtained with the salt-water that the wells had to be abandoned. Certain of these deserted salt wells were opened years after, when it was found that the troublesome substance which had made them useless was far more valuable than the brine the original drillers sought.

Naturally the first use made of the oil obtained in quantities from the salt wells was medicinal. By the middle of the century it was without doubt the great American medicine. “Seneca Oil” seems to have been the earliest name under which petroleum appeared in the East. It was followed by a large output of Kentucky petroleum sold under the name “American Medicinal Oil.” Several hundred thousand bottles of this oil are said to have been put up in Burkesville, Kentucky, and to have been shipped to the East and to Europe. The point at which the business of bottling petroleum for medicine was carried on most systematically and extensively was Pittsburg. Near that town, at Tarentum in Alleghany County, were located salt wells owned and operated in the forties by Samuel M. Kier. The oil which came up with the salt-water was sufficient to be a nuisance, and Mr. Kier sought a way to use it. Believing it had curative qualities he began to bottle it. By 1850 he had worked up this business until “Kier’s Petroleum, or Rock-Oil” was sold all over the United States. The crude petroleum was put up in eight-ounce bottles wrapped in a circular setting forth in good patent-medicine style its virtues as a cure-all, and giving directions about its use. While it was admitted to be chiefly a liniment it was recommended for cholera morbus, liver complaint, bronchitis and consumption, and the dose prescribed was three teaspoonfuls three times a day! Mr. Kier’s circulars are crowded with testimonials of the efficacy of rock-oil, dated anywhere between 1848 and 1853. Although his trade in this oil was so extensive he was not satisfied that petroleum was useful only as a medicine. He was interested in it as a lubricator and a luminant. That petroleum had the qualities of both had been discovered at more than one point before 1850. More than one mill-owner in the districts where petroleum had been found was using it in a crude way for oiling his machines or lighting his works, but though the qualities of both lubricator and luminant were present, the impurities of the natural oil were too great to make its use general. Mr. Kier seems to have been the first man to have attempted to secure an expert opinion as to the possibility of refining it. In 1849 he sent a bottle of oil to a chemist in Philadelphia, who advised him to try distilling it and burning it in a lamp. Mr. Kier followed the advice, and a five-barrel still which he used in the fifties for refining petroleum is still to be seen in Pittsburg. His trade in the oil he produced at his little refinery was not entirely local, for in 1858 we find him agreeing to sell to Joseph Coffin of New York at 62½ cents a gallon 100 barrels of “carbon oil that will burn in the ordinary coal-oil lamp.”

Although Mr. Kier seems to have done a good business in rock-oil, neither he nor any one else up to this point had thought it worth while to seek petroleum for its own sake. They had all simply sought to utilise what rose before their eyes on springs and streams or came to them mixed with the salt-water for which they drilled. In 1854, however, a man was found who took rock-oil more seriously. This man was George H. Bissell, a graduate of Dartmouth College, who, worn out by an experience of ten years in the South as a journalist and teacher, had come North for a change. At his old college the latest curiosity of the laboratory was shown him—the bottle of rock-oil—and the professor contended that it was as good, or better, than coal for making illuminating oil. Bissell inquired into its origin, and was told that it came from oil springs located in Northwestern Pennsylvania on the farm of a lumber firm, Brewer, Watson and Company. These springs had long yielded a supply of oil which was regularly collected and sold for medicine, and was used locally by mill-owners for lighting and lubricating purposes.