Paramount Petroleum Company
Claiborne Parish made headlines on January 12, 1919, when Consolidated Progressive Oil Company completed the discovery well for northern Louisiana’s prolific Homer oilfield.
About 50 miles to the west, a 1905 oil discovery at Caddo-Pines near Shreveport had first brought oil exploration to northern Louisiana. Caddo Lake drilling platforms – completed over water without a pier to shore – have been called America’s first true offshore oil wells. Exhibits at the state’s Oil City museum tell that story.
Like Caddo-Pines, the Homer field was crowded with new companies just a few months after the discovery well. Oil production soon reached an aggregate of about 10,000 barrels of oil a day. Far from Louisiana, the Pittsburgh Press declared on September 21, 1919, the “Homer Field is Sensation of Oil Industry.”
Paramount Petroleum Company began when leadership of another company operating in the Homer oilfield decided to expand operations. Superior Oil Works officers, including President George A. Todd of Oklahoma City; Secretary and Purchasing Agent H.H. Todd of Vivian, Louisiana; and Treasurer D.C. Richardson of Shreveport organized the Paramount Petroleum Company.
Superior Oil Works had been formed to build and operate a refinery close to the Homer field. Capitalized at $300,000 with common stock issued, the company began construction in Superior, Louisiana, but its officers were by then contemplating the much expanded venture – formation of Paramount Petroleum to integrate exploration, production, transportation and refining under one organization.
The new company absorbed Superior Oil Works and looked for leasing potential near the Consolidated Progressive Oil Company’s successful discovery well. As construction of the Superior refinery progressed, Purchasing Agent H.H. Todd advertised that Paramount Petroleum was “in the market for oil refinery equipment, boilers, stills, pumps, and plant machinery, etc.”
Paramount Petroleum made a deal with Consolidated Progressive Oil in May 1919, securing one-half interest in more than 11,000 acres of both proven and unexplored territory in Claiborne Parish. The acreage was already producing about 40,000 barrels of oil, ensuring the refinery would be supplied.
“A giant refining company has been organized recently in Shreveport to be known as the Paramount Petroleum Company,” noted the Oil Distribution News. The venture was capitalized at $10 million with half of its stock subscribed.
“Stock in this company has been consumed by the largest business and banking men of Shreveport,” added the Oil and Gas News. But the best news for investors was the headline: “Paramount Petroleum Gets 10,000 Barrel Well And Will Build Big Refinery.”
In March 1920, the Petroleum Age reported Paramount Petroleum “recently took over the under-construction Superior Oil Works refinery at Vivian [Superior], Louisiana, 23 miles north of Shreveport, to service Pine Island production.”
The publication added that another refinery was to be completed in north Shreveport in November 1920 “with a four-inch pipeline from the Homer field where Paramount Petroleum holds 4,700 acres.”
Within a month Paramount Petroleum was drilling in Claiborne Parish and shipping 400,600 barrels of oil a day. The company secured a $1 million mortgage from the Commercial National Bank of Shreveport and advertised, “Paramount refineries are supplied through our own pipelines from our own production.”
Paramount Petroleum in July 1920 completed the No. 5 Shaw well, which produced 500 barrels of oil a day from 2,090 feet deep in the Homer field. In August the No. 9 Shaw well came in as another 500-barrels-of-oil-a-day producer from a depth of 2,100 feet. The company inked an agreement for 300 tank cars from Standard Tank Car Company of St. Louis, Missouri.
“Paramount has just closed a deal for one half interest in 24 producing wells in the old Caddo field with 1,200 acres of proven territory on which many wells can yet be drilled,” proclaimed the Petroleum Age in October 1920. “The production department of Paramount Petroleum is making splendid headway and with its large acreage, will no doubt greatly add to the earnings of the company.”
But the Petroleum Age reporter had got it wrong. By February 1921, Paramount Petroleum’s refinery at Superior was running at only about 50 percent capacity. A contemporary trade publication reported the company’s prospects as “not too bright.”
Shipments from the Paramount Petroleum’s Homer oilfield holdings dropped to just 168 barrels of oil a day. In May 1921 the struggling company leased its underused refinery and fleet of 390 tank cars to Lucky Six Oil Company for six months.
To the south, the Busey-Armstrong No. 1 oil gusher on January 10, 1921, had opened Arkansas’ El Dorado field and Lucky Six Oil Company had entered the scramble to exploit the new field’s huge production (578,000 barrels of oil in the month of May alone). The discovery 15 miles north of the Louisiana border was the first Arkansas oil well. It attracted even more exploration and production companies to the region.
As competition intensified, Paramount Petroleum struggled to pay debts. It was unable to make a required $200,000 mortgage payment to Commercial National Bank of Shreveport in July 1921. The deal Paramount had struck with Consolidated Progressive Oil back in 1919 had become toxic.
On September 7, 1921, National Petroleum News reported Consolidated Progressive Oil was seeking a court ordered receiver take over Paramount Petroleum based on “claims totaling $849,547 and averred acts jeopardizing the interests of creditors, and among the allegations is on to the effect that officials of the defendant concern have admitted in writing the company’s inability to meet present and maturing obligations.”
Paramount Petroleum’s epitaph was brief. “It is officially stated that this company is out of business,” reported Poor’s Cumulative Service in December 1921. “Its properties are to be sold by the sheriff December 24 and proceeds applied on the first Mortgage notes.”
The first Louisiana oil well had arrived in 1904 far to the south.
More stories about petroleum exploration and production companies trying to join drilling booms (and avoid busts) can be found in an updated series of research at Is my Old Oil Stock worth Anything? Please support the American Oil & Gas Historical Society and this website with a donation. © AOGHS.