Standard's Old Policy

One leading reason for the growth of the original Standard Oil Co. was that it always had ready cash in depressions and could buy up hard-up but potentially valuable independent concerns at attractively low prices. This policy has recently been exhibited again in the acquisition of the Producers & Refiners Co. by the Prairie Oil & Gas Co.—a Standard Oil unit which dominates the mid-continent petroleum industry.

The Producers & Refiners Co. has an oil and gas acreage of 265,000 acres under lease in Wyoming, Montana, Colorado, New Mexico, Oklahoma, Kansas, Texas, Arkansas, Louisiana, an interest in several pipe lines, many retail service stations in the West and Middle West, and three refineries with a total capacity of 25,000 barrels.

The absorption of Producers & Refiners will mean that the Prairie Oil & Gas Co. will enter the refining and marketing end of the oil business and gain an outlet for its own production.

This is the first important merger which has resulted from the present depression in the petroleum industry — unless production slackens, it may not be the last. It clearly shows that although John D. Rockefeller has withdrawn from active management of oil companies, his successors are continuing his business policy of having ready cash and credit during depressions.