When a shady publisher decided to become a wildcatter seeking oil riches, the end of his story might have been predicted.
Ft. Worth publisher Chester R. Bunker, head of the World Company, began by seeking to expand subscriptions to his trade journal, which ostensibly offered readers insights into the booming Texas oil business. The 1917 “Roaring Ranger” discovery well between Ft. Worth and Abilene had brought oilfield discoveries close to home.
Bunker’s Texas Oil World (formerly Western World) was in fact a tip sheet largely for promoting his own business interests. To increase circulation, beginning in 1922 Bunker successively added memberships in his “Texas Oil World Marathon Fold Club” or “Texas Oil World Marathon Fold Drilling Club” as premium inducements for potential subscribers.
These clubs entitled each subscriber to a miniscule interest in any profits that might be drawn from his company’s distant oil leases: “a 1/10,000th interest in all emoluments and profits accruing from certain oil and gas leases of 10,000 acres, more or less in Crockett County, State of Texas, and held in trust for all members by the undersigned trustee.”
Court documents later noted that with Bunker the trustee, “the interests given to the subscribers were simply for the purpose of promoting the circulation of the oil journal and its business, and that neither Bunker nor his corporation were to benefit or profit from the promotions.”
Accordingly, Bunker undertook an unlikely wildcat drilling venture on the company’s remote Crockett County lease in 1923, prompting the offer of another subscription inducement, the “Crockett County Lease Bonus.”
After two years of drilling and to the surprise of all, on June 8, 1925, Bunker’s L.P. Powell No. 1 discovery well was completed at 2,650 feet with daily production of 25 barrels of oil. The well opened the Powell Field and prompted a flood of investors and speculators.
Twelve days after the oil discovery, the World Company – now renamed Bunker Printing & Book Company – negotiated sale of its well and 2,500 acres of its leases in Crockett County to Humble Oil Company for almost $1.4 million. Within two weeks of the Powell No. 1 well, more than $5 million had been exchanged in lease and royalty trades. Humble Oil would later become Exxon thanks to other leases at the King Ranch in Kleberg County.
On June 29, 1925, Bunker chartered the World Oil Company using capital from “assets theretofore belonging to the three clubs.” Subscribers surrendered their membership certificates and became shareholders in World Oil on the basis of $10 for every unit of membership.
World Oil offered stock to the public through advertisements in Bunker’s publications. The stock’s price advanced from about 70 cents per share to $2.60 per share by September 1926.
World Oil Company searched for oil beyond Crockett County, reportedly drilling wells in Glasscock, Hockley, Pecos, Reeves, Shackelford, Taylor and Tom Green counties. But the company failed despite these exploration efforts.
According to Oil in Texas: The Gusher Age, 1845-1945 by Roger M. Olien and Diana Davids Hinton, the company was bankrupted by Bunker’s inability to manage the businesses he created; he “drowned them in red ink.” The authors add that he was convicted of mail fraud a few years later. His wildcatting did leave a mark, however.
Today, a Texas historical marker dedicated in 1975 near Ozona notes Crockett County’s first producing oil well. “Powell No. 1 was the beginning of a vital new industry for Crockett County, before 1925 primarily a ranching area. The next important strike occurred in the Crockett Field in 1938. There are currently over 2,000 producing oil and gas wells in the county.”
The stories of exploration and production companies joining petroleum booms (and avoiding busts) can be found updated in Is my Old Oil Stock worth Anything? The American Oil & Gas Historical Society preserves U.S. petroleum history. Please support this AOGHS.ORG energy education website. For membership information, contact firstname.lastname@example.org. © 2018 Bruce A. Wells.