When I came to Texas it is always an open question in my mind as to whether I should ask for protection from the Texas Rangers. Indeed, I am never quite certain whether I will leave your beautiful city on a train, airplane or riding on a rail, and when some Texan calls me "my fine feathered friend", I have a kind of suspicion that he is looking in the direction of a tar barrel. That is, of course, the penalty of success anywhere but Texas!

But, all joking aside, I am now confronted with the problem of talking to you about a basis for the valuation of oil properties abroad. I shall assume that my assignment covers properties other than those in the United States and Canada. I might begin by saying the science of valuation of foreign oil properties is in its infancy, if it is a science at all, for not many foreign properties are transferred and those that are transferred are usually transferred on the basis of considerations other than their money value. When I go over the number of foreign properties that I know to have been sold, I come up with a very small number -the Barco concession, the various interests of the Arabian American Oil Co., the Venezuelan royalties of Barber Asphalt Co., and such trades as were made by the Texas Company for its interest in the properties of the Caracas Petroleum, the Lago Purchase by Esso from Standard of Indiana, the Creole trade, the purchase of London-Pacific Petroleum's Parinas Estate at Negritos and Talara, Peru by International Petroleum in (or about)1916, and the deal made by Shell and Jersey for interest in Mene Grande(Gulf) production. The trouble with any discussion of such trades is that beside the value of the actual oil content of the property, the really important considerations lie within the time-honored expression "discount for risk and hazard" and in many of the major properties the recovery of the oil in the fields is so much deferred that the valuation tables will give you the astonishing information that much of the oil is of practically no value at all.

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