Oklahoma-Texas Producing & Refining Company

by | Jan 1, 2021 | Petroleum Companies

Boom and bust of an obscure mid-continent petroleum company began in 1917.

The International Petroleum Register noted formation of Oklahoma-Texas Producing & Refining Company as a Delaware corporation in 1917. With capitalization of $5 million in common stock authorized and more than $734,000 issued, the company obtained leases in Muskogee, Tulsa, Rogers, and Okmulgee counties in Oklahoma, and in Allen County, Kansas.

Major north Texas oilfield discoveries in Electra (1911) and Ranger (1917) attracted petroleum companies to the mid-continent.  As oil demand soared during World War I, hundreds of new exploration and productions companies formed — and sought investors. Most of these companies would not survive.

By 1919, Oklahoma-Texas Producing & Refining’s lease ownership had expanded to 10,313 acres with an additional 815 acres from its acquisition of Tulsa Union Oil Company. About this time, all of the company’s petroleum production was sold to Prairie Oil and Gas Company.

Oklahoma-Texas Producing & Refining meanwhile continued drilling for oil in Coffee County, Kansas, and elsewhere, and the company’s estimated production reached 10,000 barrels of oil each month — a promising development for investors. The financial magazine United States Investor added a positive endorsement in May 1920 after Oklahoma-Texas Producing & Refining reported production of 27,000 barrels of oil worth $65,000.

“It appears that this company is further along the road to development that a great many of the new oil companies, though whether its shares at the present offering price of $2.50 on the basis of a $1 par represent an extravagant price, cannot be told until further developments have occurred,” United States Investor reported.

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However, six months later, the company’s shares were selling for less than 14 cents. Records of what went wrong are obscure. There are references to a convoluted business venture with another oil company. The deal was orchestrated by New York financier Mrs. Ada M. Barr after Oklahoma-Texas Producing & Refining had failed in January 1921.The next month, after being put in the hands of a receiver, the company’s assets were sold for $87,400.

The buyer was Mrs. Barr, who soon would be enveloped in controversy and litigation of her own.

Acorn Petroleum Corporation, represented by Mrs. Barr, offered bonds in the amount of $150,000 of Acorn Petroleum Corporation on the basis of $250 in bonds for each $1,000 of Oklahoma-Texas Producing & Refining stock held.

“The new company is operating the properties and has twenty-three producing wells, giving about ninety barrels of oil a day. The present low price for oil does not enable the company to earn sufficient income to pay interest on its bonds,” United States Investor noted. “Mrs. A.M. Barr, who arranged the financing of the new company, says that as soon as oil advances to a price that will permit, accrued interest on the bonds and dividends on the stock will be paid.”

But they weren’t.

By March 1923, investor Lewis H. Corbit filed a petition on behalf of a large number of local purchasers of stocks in the Acorn Petroleum Corporation of Tulsa, Oklahoma. The petition in the United States District court sought to determine the value of the local holdings, which represent an investment of approximately $100,000.

According to records, “In his complaint, asking for an investigation, Corbit alleges a stock, fraud in which $ 500,000 is involved. Certificates of shares held here were sold by a Mrs. A. M. Barr, it is disclosed in the petition.”

Further financial records and other details about Oklahoma-Texas Producing & Refining Company, Acorn Petroleum Corporation, and Mrs. Ada M. Barr can be research through the Library of Congress’ online Chronicling America: Historic American Newspapers.

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The stories of exploration and production (E&P) companies joining U.S. 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. Join today as an annual AOGHS supporting member. Help maintain this energy education website and expand historical research. For more information, contact bawells@aoghs.org. Copyright © 2021 Bruce A. Wells. All rights reserved.

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Old Colony Oil Company

by | Jul 1, 2015 | Petroleum Companies

Old Colony Oil Company began about the time the “Roaring Ranger” in Texas made national headlines in 1917 (see Oil Boom Brings First Hilton Hotel). The new company explored near Duncan, Oklahoma.

Despite production from its first two wells – a 20,000,000-cubic-foot-a-day “gasser” and a well producing 2,000 barrels oil oil a day from the Duncan field – Old Colony Oil Company failed to survive.

The company’s success in the Mid-Continent oilfield helped attract investors for funding additional lease purchases and exploratory drilling. The Mid-Continent’s potential had been revealed as early as 1892 (see First Kansas Oil Discovery). Old Colony Oil soon had operations in Texas, Oklahoma, Utah and Montana – but leasing and drilling costs coupled with a lack of consistent producers brought debt.

However, by 1922 the company’s fortunes had diminished to such a point it could only extract about 125 barrels a day from its nine remaining shallow wells in the diminishing Duncan oilfield.

With oil prices down, by May 1922 Old Colony Oil assets amounted to just $75,000 and the company was defaulting on $10,000 monthly payments due to the Wilkin-Hale Bank. Then the bank begin to fail (Wilkin and Hale of the Wilkin-Hale Bank were directors of the Old Colony Oil).

In the summer of 1922, Okahoma bank examiners investigated the interlocking directorates’ books. Hoping for the big oil strike to balance the ledgers, Wilkin-Hale Bank had used $200,000 worth of essentially worthless Old Colony Oil bonds in a transaction with the Consumers Bank of El Reno – and thereby sunk Wilkin-Hale, El Reno, and Old Colony Oil.

Obsolete Old Colony Oil stock certificates from the 1920s may have collectible value on eBay and “scripophily” websites. Such certificates sometimes are valued as artifacts from investors’ gambles on business ventures that failed.

Dry holes, market behavior, drilling costs, and a host of unpredictable hazards remain part of the high-risk, high-reward U.S. oil patch.

In 1947  experts from Halliburton and Stanolind companies applied a technology on a Duncan oilfield well – the the first commercial application of hydraulic fracturing. Learn more in Shooters – A “Fracking” History.

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The stories of other exploration attempts to join petroleum exploration booms (and avoid busts) can be found in an updated series of research at Is my Old Oil Stock worth Anything?

Old Colony Oil

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