OIL: The Deep Hole

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An oil well that goes down 12,000 ft. into the earth's crust is unusual. Only rarely have oil companies, e.g., Humble Oil, Gulf Oil, drilled below 15,000 ft. But in the little town (pop. 1,800) of Wiggins, Miss., there was a well that oilmen wondered about for years. A hearty, smooth-jowled man named George F. Vasen drilled deeper and deeper until he reached 20,450 ft., the second deepest well through the crust on record.* Although there were no other wells near Wiggins, Wildcatter Vasen insisted that there was an immense "Atlantic Ocean of oil" below the town, a limitless black pool stretching 1,000 miles from the Gulf to Pennsylvania.

Around Wiggins, Vasen was heard with respect because he was the operator of watermelon farms and tung nut groves as well as a big cattleman who drove a flashy car and owned a stable of race horses. Vasen was just as impressive up North. His confident talk was enough to persuade hundreds of people to buy interests in the well and leases on the surrounding land at $300 an acre. An 80-year-old Cedarburg, Wis. nailmaker plunked down $200,000 in hard cash; a Chicago hoodlum anted up $600,000.

The Little Fellow. Vasen's progress reports on the well were glowing: "Never in the history of the oil business has anyone accomplished the job we are doing today . . . The whole industry is talking . . . This venture is for ALL and not for a few who would like to cut the little fellow out." It sounded so good that one investor, a Chicago accountant named Irving Rothbart, whose family had put up $155, 500, decided to sell out his business for $10,000 and become a full-time oilman. He went to Wiggins on the promise of a fine home and a high-paying job with the new company.

Rothbart got a shock. Instead of the promised "palatial residence," he and his wife were ushered into a dilapidated shack. Operations at the well were fenced in and guarded by men with shotguns. When Rothbart finally was allowed in, what he saw worried him even more. The drill cores brought up from some 17,000 ft. were not soft, oily limestone but dry, hard rock. After Vasen refused to have a laboratory analysis made of the cores, the Rothbarts asked for their money back. When they did not get it, they went to the SEC.

The Record. The investigators found that Oilman George Vasen had been convicted of a confidence racket in Iowa 20 years before and served a five-year prison term, had been convicted of a similar offense in Illinois in 1941 (which the state Supreme Court reversed), and later got in trouble in Mississippi over his tung-nut dealings. The SEC tracked down 600 small investors who had poured between $2,000,000 and $3,000,000 into Vasen's bottomless well.

Last week in Chicago a federal court jury found Vasen guilty on three counts of mail and stock fraud. His sentence: five years in jail, a $25,000 fine. Said Vasen, somewhat shaken but still confident: "It's going to be very embarrassing for a lot of jerks when my well produces."