Ohio Oil Company

Life before and after independence from Standard Oil.

 

John D. Rockefeller in 1870 founded Standard Oil Company, and by 1890 his dominance of the U.S. petroleum industry put every small oil venture at risk. They founded the Ohio Oil Company to fight back.

As U.S. petroleum production grew, many exploration and production companies found themselves with only one market — Standard Oil Company — and their own oversupply of crude oil driving prices down. Rockefeller believed only a few large, vertically integrated companies could survive and prosper; smaller companies simply could not.

“We will take your burden,” Rockefeller told these companies. “We will utilize your ability; we will give you representation; we will all unite together and build a substantial structure on the basis of cooperation.” (more…)

Marathon of Ohio Oil

A 1954 well drilled by the Ohio Oil Company well reached more than four miles deep.

Founded in 1887 by Henry M. Ernst, the Ohio Oil Company got its exploration and production start in northwestern Ohio, at the time a leading oil producing region. Two years later,  John D. Rockefeller’s Standard Oil Trust purchased the company — known as “the Ohio” — and in 1905 moved headquarters from Lima to Findlay.

Soon establishing itself as a major pipeline company, by 1908 the Ohio controlled half of the oil production in three states. The company resumed independent operation in 1911 following the dissolution of the Standard Oil monopoly.

The Ohio Oil Company’s exploration operations would expand into Wyoming and further westward.

Marathon of Ohio Oil motor oil advertisement

The Ohio Oil Company in 1930 purchased Transcontinental Oil, a refiner that had marketed gasoline under the trademark “Marathon” since 1920. Photo courtesy Library of Congress.

In 1915, the company’s infrastructure added 1,800 miles of pipeline, as well as gathering and storage facilities, from its newly acquired Illinois Pipe Line Company. The Ohio then purchased the Lincoln Oil Refining Company to better integrate and develop more crude oil outlets.

“Ohio Oil saw the increasing need for marketing their own products with the ever increasing supply of automobiles appearing on the primitive roads,” explained Gary Drye, a collector of gas station antiques, in a 2006 forum at Oldgas.com

The company ventured into marketing in June 1924 by purchasing Lincoln Oil Refining Company of Robinson, Illinois. With an assured supply of petroleum, the Ohio Oil’s “Linco” brand quickly expanded.

Marathon of Ohio Oil gas station

The Ohio Oil Company marketed its oil products as “Linco” after purchasing the Lincoln Oil Refinery in 1920. Undated photo of a station in Fremont, Ohio.

Meanwhile, a subsidiary in 1926 co-discovered the giant Yates oilfield in the Permian Basin of New Mexico and West Texas. “With huge successes in oil exploration and production ventures, Ohio Oil realized they needed even more retail outlets for their products,” Drye reported.

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By 1930, Ohio Oil Company distributed Linco products throughout Ohio, Indiana, Illinois, Michigan and Kentucky.

Marathon of Ohio Oil

In 1930 Ohio Oil purchased Transcontinental Oil, a refiner that had marketed gasoline under the trademark “Marathon” across the Midwest and South since 1920. Acquiring the Marathon product name included the Pheidippides Greek runner trademark and the “Best in the long run” slogan.

Marathon of Ohio Oil Marathon logo

Adopted in 2011, the third logo for corporate branding in Marathon Oil’s 124-year history.

According to Drye, Transcontinental “can best be remembered for a significant ‘first’ when in 1929 they opened several Marathon stations in Dallas, Texas in conjunction with Southland Ice Company’s ‘Tote’m’ stores (later 7-Eleven) creating the first gasoline/convenience store tie-in.”

The Marathon brand proved so popular that by World War II the name had replaced Linco at stations in the original five state territory. After the war, Ohio Oil continued to purchase other companies and expand throughout the 1950s.

Ohio Oil’s California Record

As deep drilling technologies continued to advanced in the 1950s, a record depth of 21,482 feet was reached by the Ohio Oil Company in the San Joaquin Valley of California.

Marathon of Ohio Oil magazine article

Petroleum Engineer magazine in 1954 noted the well set a record despite being “halted by a fishing job.”

The deep oil well drilling attempt about 17 miles southwest of Bakersfield in prolific Kern County, experienced many challenges. A final problem led to it being plugged with cement on December 31, 1954. At more than four miles deep, down-hole drilling technology of the time was not up to the task when the drill bit became stuck.

The challenge of retrieving obstructions from deep in a well’s borehole – “fishing” – has challenged the petroleum industry since the first tool stuck at 134 feet and ruined a well spudded just four days after the famous 1859 discovery by Edwin Drake in Pennsylvania. See The First Dry Hole

In a 1954 article about deep drilling technology, The Petroleum Engineer noted the Kern County well of the Ohio Oil Company — which would become Marathon Oil — set a record despite being “halted by a fishing job.” The well was a financial lost.

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A 1953 Kern County well drilled by Richfield Oil Corporation produced oil from a depth of 17,895 feet, according to the magazine. At the time, the average U.S. cost for the nearly 100 wells drilled below 15,000 feet was about $550,000 per well. Learn more California petroleum exploration history by visiting the West Kern Oil Museum.

More than 630 exploratory wells with a total footage of almost three million feet were drilled in California during 1954, according to the American Association of Petroleum Geologists — the AAPG, established in 1917.

In 1962, celebrating its 75th anniversary, The Ohio changed its name to Marathon Oil Company and launched its new “M” in a hexagon shield logo design. Other milestones include:

1981 – U.S. Steel (USX) purchased the company.
1985 – Yates field produced its billionth barrel of oil.
1990 – Marathon opened headquarters in Houston.
2005 – Marathon became 100 percent owner of Marathon Ashland Petroleum LLC, which later became Marathon Petroleum Corp.
2011 – Completed a $3.5 billion investment in the Eagle Ford Shale play in Texas.

On June 30, 2011, Marathon Oil became an independent upstream company and unveiled an “energy wave” logo as it prepared to separate from Marathon Petroleum, based in Findlay. Read a more detailed history in Ohio Oil Company and visit the Hancock Historical Museum in Findlay. 

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Recommended Reading: Portrait in Oil: How Ohio Oil Company Grew to Become Marathon (1962). Your Amazon purchase benefits the American Oil & Gas Historical Society. As an Amazon Associate, AOGHS earns a commission from qualifying purchases.

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The American Oil & Gas Historical Society preserves U.S. petroleum history. Become an AOGHS annual supporting member and help maintain this energy education website and expand historical research. For more information, contact bawells@aoghs.org. Copyright © 2023 Bruce A. Wells. All rights reserved.

Citation Information – Article Title: “Marathon of Ohio Oil.” Authors: B.A. Wells and K.L. Wells. Website Name: American Oil & Gas Historical Society. URL: https://aoghs.org/stocks/marathon-ohio-oil. Last Updated: January 14, 2023. Original Published Date: December 28, 2014.

Kansas “Wind Gas” Well

The gas that would not burn — and the professor who extracted helium from a natural gas well in 1905.

 

Drilling for natural gas in May 1903, an exploratory well of the Gas, Oil and Developing Company found helium on William Greenwell’s farm near Dexter, Kansas. The discovery came at a depth of just 560 feet as the company drilled into a geologic formation that produced “a howling gasser” flowing an estimated nine million cubic feet of natural gas a day.

(more…)

History of Con Edison

The New York, Manhattan, Metropolitan, Municipal, Knickerbocker and Harlem gas companies merged in 1884.

 

The history of Con Edison includes stories of work crews from New York City’s many competing gas companies digging up lines of rivals — and literally battling for customers, giving rise to the term “gas house gangs.”

An 1873 "bird's eye view" illustrates New York and Brooklyn.

Competing New York City manufactured gas companies provided lighting beginning in 1823. This 1873 “bird’s eye view” illustrates New York and Brooklyn. The Brooklyn Bridge, under construction from 1870 to 1883, is at right. Courtesy Library of Congress.

Today still among the nation’s largest gas utility companies, Consolidated Edison, Inc. — known as “Con Edison” or “Con Ed” — began on November 11, 1884, when six New York City gas-light companies merged. But Con Edison can trace its history more than six decades earlier to the New York Gas Light Company. All provided gas from their nearby plants distilling coal.

Manufactured Gas

“Before the Brooklyn Bridge spanned the East River, before the Statue of Liberty first graced New York Harbor, and before skyscrapers rose above New York City’s streets, the utility companies that would eventually become Con Edison were already building the energy infrastructure needed to fuel and sustain the city’s growth,” notes one historian. (more…)

Ute Oil Company – Oil Shale Pioneer

Utah exploration company sought wealth from Gilsonite deposits.

 

The attempt to extract commercial amounts of oil from shale formations failed, but the effort of Ute Oil Company in Utah’s Uinta Basin was ahead of its time.

A survey party in 1861 described the Uinta Basin in eastern Utah as, “One vast contiguity of waste and measurably valueless, except for nomadic purposes, hunting grounds for Indians, and to hold the world together.”

After reading the survey report, Brigham Young, who had founded Salt Lake City in 1847, scrapped his plans to send a group of Mormon settlers to the area.

Gilsonite, a coal-like natural asphalt.

Gilsonite is a coal-like natural asphalt found in the Uintah Basin in northeastern Utah.

Young thought the arid region better suited for a Ute Indian reservation, according to historians at the Utah Humanities Council, and President Abraham Lincoln created the Uintah Reservation by executive order.

However, by the time Utah became the 45th state in 1896, the sparsely populated region bordering Colorado had begun revealing its mineral wealth, including gold, silver, lead, zinc, copper, and a soft coal-like substance.

Coalbed Methane

Coal and a coal-like hydrocarbon — Gilsonite — brought mineral exploration companies to eastern Utah soon after the turn of the century. Gilsonite, also known as North American Asphaltum, was unique to the region known for its thick shale depsites.

Miners remove Gilsonite from narrow mines, circa 1920s.

In the 1920s, companies extracted oil shale and Gilsonite from narrow mines.

By the early 20th century, aspiring entrepreneurs had arrived to exploit these new petroleum resources. Several new ventures would be among the earliest anywhere seeking to make money by squeezing oil from shale. The Uinta Basin has since become one of the largest coalbed methane producing areas in the United States.

By 2015, petroleum engineers estimated the vast desert plateau in Utah and Colorado contained between eight trillion cubic feet and 10 trillion cubic feet of gas reserves.

The Gilsonite Maneuver

“The first attempt at oil shale exploitation took place in 1917 by the Ute Oil Company,” noted the Bureau of Land Management in a 2007 technical report about oil shale and tar sands areas in Colorado, Utah and Wyoming.

Established in 1916, Ute Oil Company was created to refine petroleum from a dense shale mined north of Watson, Utah. Oil shales had proven abundant there. So had Gilsonite found in deep vertical veins. The coal-like natural asphalt had many industrial uses.

Color map courtesy Utah Geological Society of Utah oil shale deposits.

Although Ute Oil Company found Gilsonite and oil shales abundant in northeastern Utah, processing the hard shale proved too expensive as other conventional U.S. discoveries brought far lower oil prices. Color map courtesy Utah Geological Society.

 

Gilsonite had been vigorously promoted since 1886 by Samuel H. Gilson, its principal investigator, marketer and namesake. He formed a company to mine and market Gilsonite on a commercial scale.

Gilson, a former rider for the Pony Express between California and Missouri, believed his Gilsonite (or Uintahite) practical for use in everything from a waterproof coating for wooden pilings, as an insulation for wire cable, and as paint or a varnish. He even promoted the natural, resinous hydrocarbon as an additive for chewing gum.

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Utah’s Gilsonite was selling for more than $12 a ton when in 1888, despite Bureau of Indian Affairs protests, Congress opened a 7,040 acre oil shale and Gilsonite-laden strip on the Uinta Ouray Reservation for placer mine claims.

 October 1918 article about shale oil in "Petroleum Age" magazine.

An October 1918 article in “Petroleum Age” magazine described a planned shale oil plant at Watson, Utah, that would be the largest in United States. The author is the plant’s designer, St. Louis engineer George W. Wallace, who will become superintendent of Ute Oil Company.

Placer claims could be filed for mining a fixed amount of acreage by a person or group. These claims on Indian Reservations often led to lengthy litigation. The law required production of resources in order for the claimant to be granted a legitimate right to the land. Learn more about the Placer Act in First Wyoming Oil Well.

Ute Oil Company’s interest was in oil shale’s kerogen (naturally occurring organic matter) content. Oil shales like Gilsonite can yield petroleum when sufficiently “cooked.” The distillates boil off and are captured as in other refining operations.

In eastern Utah, Ute Oil Company made a 100 acre placer claim near Watson alongside the White River, about 100 feet up a hillside where promising oil shale deposits could be cheaply mined and then refined. Other companies had the same idea.

Oil Shale Boom Towns

The boom towns of Watson, Dragon Junction and Rainbow were spawned amidst new Gilsonite mines. A narrow gauge (and short-lived) Uintah Railroad was built specifically to link them to the Rio Grande Western Railway 63 miles away.

Oil shale production mining technology, circa 1920s

Oil shale production mining technologies of the 1920s were dangerous and expensive. Above is Ute Oil Company’s processing plant under construction.

By 1911, what was called the “crookedest railroad in the West” had overcome steep mountain grades and crossed 40 bridges to reach Watson and the Rainbow Gilsonite mine, above the White River. Crane Shale Oil, Utah Shale & Oil, and the Western Shale Oil Company all planned oil and gasoline reduction plants near Watson. 

As the Bureau of Land Management (BLM) began tracking these early efforts to make money by extracting oil from shale, Ute Oil led the way as a petroleum industry pioneer for the oil shale boom that began in the mid-2000s.

Although the company would never complete its ambitious construction of a retorting plant for processing shale, it explored new technologies to maximize production. A 2007 BLM report explained how the company planned building its plant at Watson, today a Uintah County ghost town.

“Construction began on a tramway and processing plant ,” the report noted. “Processing was supposed to extract 90 percent of the oil contained in the pulverized oil shale to produce an average of 54 gallons of oil per ton of shale.”

A train carrying Ute oil shale on a mountainside.

It was difficult and dangerous to get the shale out of the isolated region.

By November 1919, construction of Ute Oil’s new refinery was nearing completion near the old White River stagecoach station. The company predicted yields of 51.5 gallons of oil and 3.6 gallons of gasoline per ton of processed oil shale when the 18 retorts went on stream. The new plant had a projected capacity of 400 tons daily.

Even using modern technology, the U.S. Geological Survey has reported typical shale yields are between 15 gallons and 25 gallons of oil per ton.

In 1920, industry trade publications continued to praise oil shale developments in Utah and Colorado, but noted that high processing costs for limited production were proving hard to overcome with the day’s technology.

Hard Oil Shale Lessons

Oil shale possibilities intrigued investors and the “American Gas Engineering Journal” of January 3, 1920, crowed: “Twenty-Two Billion Barrels of Oil a Possibility of the Process – Estimates of Production Cost Show Possibility of Shale Oil Competing with Gasoline at Its Lowest Previous Level.”

A Geological Survey investigator proclaimed oil shales offered “more than eight times all of the oil available from the oilfields of the United States!”

Oil industry trade publications recognized that Gilsonite and products made from other oil shales like Asphaltite might supplement production from U.S. oilfields, but the business model was risky. Much hinged on a small margin — limited by extraction technologies and the price of crude oil.

Mine entrance where Ute Oil Company attempted to profit from oil shale.

“A few crumbling buildings” are all that reman of Watson, Utah, where the Ute Oil Company was the first company to attempt to profit from oil shale. Quote and 1998 photo courtesy Jeremy Carter, Ghosttowns.com.

“Crude shale oil, obtained by retorting oil shale, cannot find a general market until the price of well oil is above the cost of producing shale oil,” reported the October 1921 Mining and Oil Bulletin.

“This cost has been conservatively estimated at $1.85 a barrel, for mining and retorting,” the trade publication added. “When the price of well petroleum approaches or better — exceeds this figure — the production of crude shale oil will take on renewed activity.”

Ute Oil Company had optimistically projected its cost at only $1.02 per barrel. In 1918, the year after the company formed, oil sold for about $1.98 per barrel, but in 1920, it dropped to $1.73. It would get much worse. By 1931, oil prices had dropped to only about 65 cents per barrel.

Ute Oil company’s profit margin depended a high price for oil, but surging oil supplies from traditional oil wells in Texas and other states drove down the price.

Ute oil shale article in 1920 Oil and Gas News

By the 1920s, many industry publications were following attempts to develop oil shales in Utah and Colorado. In addition to the “Oil and Gas News” prediction above, the “American Gas Engineering Journal” envisioned production of 22 billion barrels of oil from shale.

End of Ute Oil Company

In addition to the financial and technological risks that Ute Oil faced, regulatory issues added to its misery. In 1920, Congress passed the Mineral Leasing Act, updating the archaic 1872 law and requiring for the first time that the federal government receive royalty payments from successful placer claims.

An ominous 1921 “Petroleum Times” article noted work had been delayed “by a controversy with the Government over title to the land.”

The litigation among private, state, federal and Indian tribal interests would last decades. The controversy came from renewed congressional interest in rectifying injustices that had historically deprived the Uinta Basin Indians since the reservation had been formed in 1861.

Ute Oil Company patent drawing for retort for processing oil shale.

Ute Oil Company failed in 1923 before it could complete its uniquely designed retort for processing oil shale.

Although legal battles would continue, Ute Oil’s fate was sealed. Trade publications reported that the company undertook reorganization in 1923, but did not survive. The BLM would later note that “interest in oil shale production rebounded when oil prices peaked in the 1970s.”

During the 1920s Earl Douglass, a paleontologist who discovered Dinosaur National Monument, became an eloquent spokesman for Utah’s oil industry after several small oil discoveries. After drilling for oil in Utah for more than 25 years, J.L. “Mike” Dougan made the state’s first major oil strike in 1948.

Learn more in First Utah Oil Wells.

In the Energy Policy Act of 2005, the Congress declared U.S. oil shale and tar sands strategically important domestic energy resources that should be developed to reduce the nation’s growing dependence on oil from foreign sources. Five years later, Utah produced more than 8.1 trillion cubic feet of natural gas valued at more than $1.7 billion.

The market price of Gilsonite in 2010 ranged from $250 to $1,800 per ton — compared to $10 to $12 per ton in the late 1800s.

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Recommended Reading: Utah Oil Shale: Science, Technology, and Policy Perspectives (2016); From the Ground Up: A History of Mining in Utah (2006). Your Amazon purchase benefits the American Oil & Gas Historical Society. As an Amazon Associate, AOGHS earns a commission from qualifying purchases.

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The American Oil & Gas Historical Society preserves U.S. petroleum history. Become an AOGHS annual supporting member and help maintain this energy education website and expand historical research. For more information, contact bawells@aoghs.org. Copyright © 2022 Bruce A. Wells. All rights reserved.

Citation Information – Article Title: “Ute Oil Company — Oil Shale Pioneer.” Authors: B.A. Wells and K.L. Wells. Website Name: American Oil & Gas Historical Society. URL: https://aoghs.org/stocks/oil-shale-pioneer. Last Updated: October 1, 2022. Original Published Date: April 6, 2016.

 

Elk Basin United Oil Company

Elk Basin United Oil Company incorporated in 1917 seeking oil riches in Wyoming’s booming Elk Basin oilfield. Oilfields found in North Texas, including a 1911 gusher at Electra, already had resulted in a rush of new exploration ventures – and created boom towns like Burkburnett

Wherever found, America’s newly discovered oilfields led to the founding of many exploration ventures that competed against more established companies.

Newly formed companies frequently struggled to survive as competition for financing, leases, and drilling equipment intensified, especially as exploration moved westward.

Wyoming Oilfields

In a remote, scenic valley on the border of Wyoming and Montana, a discovery well opened Wyoming’s Elk Basin oilfield on October 8, 1915. Wyoming’s earliest oil wells had produced quality, easily refined oil as early as 1890.

Drilled by the Midwest Refining Company, the wildcat well produced up to 150 barrels of oil a day of a high-grade, “light oil.” Credit for oil discovery is given to geologist George Ketchum, who first recognized the Elk Basin as a likely source of oil.

Oil gusher at the Elk Basin Field in Wyoming, circa 1917.

“Gusher coming in, south rim of the Elk Basin Field, 1917.” Photo courtesy American Heritage Center.Ketchum, a farmer from Cowly, Wyoming, in 1906 had explored the area with C.A. Fisher, who had been the first geologist to map a region within the Bighorn Basin southeast of Cody, Wyoming, where oil seeps were discovered in 1883.

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The Elk Basin, which extends from Carbon County, Montana, into northeastern Park County, Wyoming, attracted further exploration after the 1915 well. More successful wells followed.

Once again, petroleum discoveries in unproved territory attracted speculators, investors, and new companies – including the Elk Basin United Oil Company.

Established petroleum companies like Midwest Refining — and the Ohio Oil Company, which would become Marathon Oil — came to the Elk Basin. These oil companies had the financial resources to survive a run of dry holes or other exploration hazards.

The exploration industry’s many smaller and under-capitalized companies would prove especially vulnerable.

Advertisement promoting Elk Basin United Oil Company, circa 1917..

Audacious advertising claims helped Elk Basin United Oil Company compete for investors.

Is My Old Oil Stock Worth Anything features several such small players in Wyoming’s petroleum history, including the notorious Dr. Frederick Albert Cook (Arctic Explorer turns Oil Promoter). Even Wyoming’s famous showman, Col. William F. Cody, got caught up in the state’s oil fever (Buffalo Bill Shoshone Oil Company).

Elk Basin United Oil Company

Elk Basin United Oil Company of Salt Lake City, Utah, incorporated on July 30, 1917, and acquired a lease of 120 acres in Wyoming’s Elk Basin oilfield. By February 1918, company stock sold for 12 cents a share.

Enthusiastic newspaper ads promoted its “6 properties in 3 different fields…A 6 to 1 shot!” Twenty producing wells were reputed to be within one mile of Elk Basin United Oil’s Wyoming well site.

Meanwhile, Elk Basin United Oil reported expansion plans underway in a growing Kansas Mid-Continent oilfield. The company secured leases near Garnett and completed four producing oil wells, yielding a total of about 500 barrels of oil a month. It added an additional 112 acres and planned a fifth well.

Prairie Pipe Line Company (later Sinclair Consolidated) completed pipelines into the Garnett field through which several companies looked to transport their oil production.

However, growing competition from better funded exploration ventures and low crude oil prices ranging between $1.10 and $1.98 per barrel of oil in 1917 and 1918 drove many small companies into consolidations, mergers or bankruptcy.

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Elk Basin United Oil, exploring back in Wyoming by March 1919, sought a lease on the property of the First Ward Pasture Company bordering the Utah line, “with a view of prospecting the property declare the surface showing to be very favorable for an oil deposit.” But financial issues continued to burden the company.

In December 1919, Oil Distribution News reported Basin United Oil Company was negotiating mergers with the Anderson Oil Company and the Kansas-United Oil Company, with a proposed capitalization of $1 million. With no results of the planned combination documented, Elk Basin United Oil Company disappeared from financial records soon thereafter.

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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? Become an AOGHS annual supporting member and help maintain this energy education website and expand historical research. For more information, contact bawells@aoghs.org. Copyright © 2022 Bruce A. Wells. All rights reserved.

Citation Information – Article Title: “Elk Basin United Oil Company.” Authors: B.A. Wells and K.L. Wells. Website Name: American Oil & Gas Historical Society. URL: https://aoghs.org/old-oil-stocks/elk-basin-united-oil-company. Last Updated: September 29, 2022. Original Published Date: October 1, 2021.

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