The Quest for Black Gold
Spurred by memories of the gold rush, hordes of prospectors descended on California in the 1860s, seeking another kind of bounty - black gold, or oil. Their early efforts were fruitless.
Chevron's earliest predecessor, Pacific Coast Oil Co., was incorporated in 1879 in San Francisco. The first logo contained the company name against a backdrop of wooden derricks set among the Santa Susana Mountains that loomed over Pico Canyon. This was the site of the company's Pico No. 4 field, California's earliest commercial oil discovery. (Chevron Photo)
Undeterred, petroleum pioneers Demetrius Scofield and Frederick Taylor of the California Star Oil Works, a Chevron predecessor, took aim at Pico Canyon, a remote portion of the rugged Santa Susana Mountains. In September 1876, driller Alex Mentry succeeded in striking oil in Pico No. 4, despite rattlesnakes, wasps, mud and underbrush.
The first successful oil well in California, Pico No. 4 launched California as an oil-producing state and demonstrated the spirit of innovation, ingenuity, optimism and risk-taking that has marked the company ever since.
Lacking the capital it would need to seize marketing opportunities in this growing area, California Star was acquired by the Pacific Coast Oil Co. on Sept. 10, 1879. Colonel Charles Felton, Coast Oil's president, had incorporated the company less than seven months earlier, on Feb. 19, 1879.
Within the next year, Coast Oil built California's largest and most modern refinery, with a capacity of 600 barrels a day, at Point Alameda on San Francisco Bay; constructed a pipeline that linked Pico Canyon with the Southern Pacific's train station at Elayon in southern California; and undertook an extensive, largely successful drilling program.
In 1895, the company initiated its enduring marine history when it launched California's first steel tanker, the George Loomis, which could ship 6,500 barrels of crude between Ventura and San Francisco.
A New Force Enters the Region
In 1878, Standard Oil Co. opened a three-person, second-story office in San Francisco. Despite its modest trappings, Standard possessed marketing acumen, outstanding products, an aggressive advertising philosophy and financial backing from its New York parent.
By 1885, it consolidated its Western interests under its subsidiary, the Standard Oil Co. (Iowa), which controlled distribution stations throughout the West Coast. Iowa Standard quickly became the area's major seller of kerosene, and by 1900, the company controlled a staggering 96.5 percent of the Western market in light oils.
Lacking Iowa Standard's marketing savvy and financial clout, Coast Oil had been struggling, despite its successful record of exploration and production. As a result, in 1900, Coast Oil agreed to be acquired by Iowa Standard, while retaining the name of Pacific Coast Oil Co. Through the acquisition, Iowa Standard gained a presence in the production, transportation and refining businesses.
Richmond's Colossal Refinery
After buying 500 acres of rolling lands on the northeast shore of San Francisco Bay in 1901, Standard completed the Richmond Refinery a year later. To feed this new colossus of West Coast refineries, Standard laid a pipeline from Richmond to the prolific new oil fields at Kern River and Coalinga.
Since Richmond's location also made it ideal for a marine terminal in San Francisco Bay, Standard expanded its fleet by acquiring several vessels - including the Asuncion, a 2,196-ton collier that was converted into a 21,000-barrel tank ship; the 12,000-barrel tanker, Maverick; the 38,000-barrel tanker Colonel E.L. Drake; and the 23,000-barrel Barge 9.
A New Entity Is Born
As the company grew, it changed structurally. In 1906, a consolidation between Pacific Coast Oil and Iowa Standard created a new entity, Standard Oil Co. (California), finalizing an integration that had existed for six years.
The "new" company stepped up its marketing efforts, particularly in gasoline sales, which nearly doubled between 1906 and 1910, and lubricants, which were marketed under the Calumet, Diamond, Petrolite, Ruddy Harvester, Zerolene and Zone labels.
To meet the growing market for motor fuels, the company came up with a revolutionary new sales mechanism - the world's first "service station," started in Seattle by sales manager John McLean.
The First Gusher
Until now, Standard had left the hunt for oil to others. In 1909, the company decided to gamble on its ability to find its own oil. After several initial failures, the drilling team had its first success on Jan. 22, 1910, when a gusher flowed in at 1,500 barrels a day at the Midway-Sunset Field in Kern County, California.
Going It Alone
The company's expertise in searching for oil became increasingly important as a May 1911 Supreme Court decision separated Standard Oil Co. (California) from its parent, a giant New York-based corporation. The decision concluded the government's 4 1/2-year suit under the Sherman Antitrust Act against the Standard Oil Co. (New Jersey), its subsidiaries and affiliates.
Before the end of 1911, Standard Oil Co. (California) added to its refining capacity with the completion of the El Segundo plant in Southern California, formed the California Natural Gas Co. to expand its search for natural gas in the San Joaquin Valley and beyond, and constructed a second pipeline linking Richmond and the Kern River Field.
In addition to demonstrating its overall growth, the company reaffirmed its pioneering spirit by naming Demetrius Scofield, who tapped the company's first well, to be president of the Standard Oil Co. (California).