How I Made My First Billion

After many fruit less months of prospecting for oil in Oklahoma, I finally spudded my first test well not far from Stone Bluff, a tiny Muskogee County hamlet, in early January 1916.

On February 2, the bailer—the device which cleared formation rock from the drill hole—brought up a quantity of oil sand. This indicated that we were nearing the final stages of drilling; the next twenty-four hours would prove whether the well was a producer or a dry hole.

I was still very young and quite green. My nervousness and excitement rose to an intolerable pitch. I became more hindrance than help to the men on my drilling crew. To get out of their way and ease my own tension, I beat a strategic retreat to Tulsa, the nearest city of any size. I decided to wait there until the drilling operation was completed and the results were known. In Tulsa, J. Carl Smith, a close friend who was considerably older and far less excitable than I, volunteered to go to the drilling site and supervise the work there for me.

There were no telephones in the remote area where my well was being drilled. The single line between Stone Bluff and Tulsa seldom worked. Hence, J. Carl Smith promised to return to Tulsa on the last train from Stone Bluff the next day and inform me of the latest developments.

On the following day—a chill, blustery February 3, 1916—I was at the Tulsa railroad depot, anxiously pacing the windswept passenger platform more than an hour before the train was due to arrive. At last, it pulled into the station. Endless seconds later, J. Carl Smith's familiar figure emerged from one of the coaches. His face beamed, and my hopes soared.

"Congratulations, Paul!" he boomed when he saw me on the platform. "We brought in your well this afternoon. It's producing thirty barrels!"

I automatically assumed he meant thirty barrels a day, and my elation vanished instantly. Thirty barrels a day—why, that was a mere trickle compared to the gushers other oilmen were bringing in at the time.

"Yes, sir," J. Carl grinned. "We're getting thirty barrels an hour ..."

Thirty barrels an hour!

That made a difference, a world of difference. That meant the well was producing 720 barrels of crude oil daily. It also meant that I was in the oil business—to stay.

Being the son of a successful oilman, I had been exposed to the virus of oil fever since childhood. My parents, George F. and Sarah Getty, and I first visited what was then the Oklahoma Territory in 1903, when I was ten. While there, my father, a prosperous Minneapolis attorney-at-law, found it impossible to resist the lure of the Oklahoma Oil Rush, which was then in full swing. He formed the Minnehoma Oil Company and began prospecting for oil.

My father, a self-made man who had known extreme poverty in his youth, had a practically limitless capacity for hard work, and he also had an almost uncanny talent for finding oil. After organizing Minnehoma Oil, he personally supervised the drilling of forty-three oil wells, of which forty-two proved to be producers!

I served a tough and valuable apprenticeship working as a roustabout and tooldresser in the oil fields in 1910 and 1911, but I didn't go into the oil business for myself until September 1914. I had but recently returned to the United States after attending Oxford University in England for two years. My original intent was to enter the U.S. Diplomatic (continued on page 94)Billion(continued from page 82) Service, but I deferred that plan in order to try my luck as an independent operator—a wildcatter—in Oklahoma.

The times were favorable. It was a bonanza era for the burgeoning American petroleum industry. A lusty, brawling pioneer spirit still prevailed in the oil fields. The Great Oil Rush continued with unabated vigor and was given added impetus by the war that had broken out in Europe that year. Primitive boom towns dotted the Oklahoma countryside. Many bore bare-knuckled frontier-era names such as those of the four "Right" towns: Drumright, Dropright, Allright and Damnright.

Streets and roads were unpaved—rivers of mushy clay and mud in spring and winter and sun-baked, rutted tracks perpetually shrouded by billowing clouds of harsh red or yellow dust in summer. Duckboard sidewalks installed outside the more prosperous business establishments and gambling halls were viewed as the ultimate in civic improvements.

The atmosphere was identical to that which historians describe as prevailing in the California gold fields during the 1849 Gold Rush. In Oklahoma, the fever was to find oil, not gold, and it was an epidemic. There were few, indeed, who were immune to the contagion.

Fortunes were being made—and lost—daily. It was not unusual for a penniless wildcatter, down to his last bit and without cash or credit with which to buy more, to drill another hundred feet and bring in a well that made him a rich man. A lease which sold for a few hundred dollars one afternoon sometimes increased in value a hundredfold or even a thousandfold by the next morning.

On the other hand, there were men who invested all they owned in leases and drilling operations only to find that they had nothing to show for their money and efforts but a few dismally dry holes. Leases purchased at peak prices one day proved to be utterly valueless the next. It was all a gargantuan, supremely thrilling gamble for staggering stakes, and I plunged into the whirl hopefully. I had no capital of my own; my personal budget was $100 per month. My first year was anything but profitable. Large oil strikes were being reported regularly, and other wildcatters were bringing in gushers and big producers, but fortune seemed to elude me.

Then, in the late fall of 1915, a halfinterest in an oil lease near Stone Bluff in Muskogee County was offered for sale at public auction. I inspected the property and thought it highly promising. I knew other independent operators were interested in obtaining the lease, and this worried me. I didn't have much money at my disposal—certainly not enough to match the prices older, established oilmen would be able to offer. For this reason, I requested my bank to have one of its representatives bid for me at the sale without revealing my identity as the real bidder.

Surprisingly enough, this rather transparent stratagem accomplished the purpose I intended. The sale, held in the town of Muskogee—the county seat—was attended by several independent oil operators eager to obtain the lease. The unexpected appearance of the well-known bank executive who bid for me unnerved the wildcatters. They assumed that if a banker was present at the auction, it could only mean that some large oil company was also interested in the property and was prepared to top any and all offers. The independents glumly decided it would be futile to bid and, in the end, I secured the lease for $500—a bargain-basement price!

Soon thereafter, a corporation was formed to finance the drilling of a test well on the property. I, as a wildcatter with no capital of my own, received a modest fifteen-percent interest in the corporation. I assembled a crack drilling crew, and my men and I labored to erect the necessary wooden derrick and to rush the actual drilling operations. We spudded the well in early January 1916. I remained on the site night and day until the drilling went into its final stages. Then, as I've related, I found it impossible to stand the nervous strain and fled to Tulsa, where my friend J. Carl Smith brought me the news that the well had come in for an initial daily production of 720 barrels.

The lease on the property was sold to a producing oil company two weeks after that, and I realized $12,000 as my share of the profits. The amount was not very impressive when compared to the huge sums others were making, but it was enough to convince me that I should—and would—remain in the oil business as a wildcatter.

My father and I had previously formed a partnership. Under its terms he was to provide financing for any exploration and drilling I conducted and supervised for the partnership. In return, he would receive seventy percent of the profits, while I received the remaining thirty percent. After my first success, we incorporated the partnership and in May 1916 formed the Getty Oil Company, in which I received a thirty percent stock interest.

Many fanciful—and entirely erroneous—accounts of the business relationship between us have appeared in print. Contrary to some published reports, my father did not set me up in business by giving me any outright cash gifts. George F. Getty rejected any ideas that a successful man's son should be pampered or spoiled or given money as a gift after he was old enough to earn his own living. My father did finance some of my early operations—but solely on the seventy-thirty percent basis. Insofar as lease purchases and drilling or other operations I conducted on my own account were concerned, I financed these myself. My father neither provided the money for my private business ventures nor did he share in the profits I received from them.

Incidentally, there is another popular misconception I'd like to correct once and for all. It has been said that my father bequeathed me a huge fortune when he passed away in 1930. Actually. he left me $500,000 in his will—a considerable sum, I'll admit, but nonetheless a very small part of his fortune. It was a token bequest. My father was well aware that I had already made several million dollars on my own, and he left the bulk of his estate to my mother.

After Father and I incorporated our partnership in 1916, I went right on prospecting and drilling for oil. My enthusiasm was not dampened when my second well proved to be a dry hole. By then, wildcatting was in my blood and I continued to buy and sell leases and to drill wells. I usually acted as my own geologist, legal advisor, drilling superintendent, explosives expert and even, on occasion, as roughneck and roustabout. The months that followed were extremely fortunate ones. In most instances, the leases I bought were sold at a profit, and when I drilled on a property, I struck oil more often than not.

There were no secrets, no mystical formulas behind these successes. I operated in much the same manner as did almost all wildcatters—with one important exception. In those days, the science of petroleum geology had not yet gained very wide acceptance in the oil fields. Many oilmen sneered openly at the idea that some "damned bookworm" could help them find oil. At best, the vast majority of oilmen were skeptical about geology as a practical science and put little stock in geologists' reports. I was among the few who believed in geology. I studied the subject avidly at every opportunity, and applied what I learned to my operations.

The independent operator had to possess a certain amount of basic knowledge and skill. He also needed reliable, loyal and experienced men on his exploration and drilling crews. But, beyond these things, I believe the most important factor that determined whether a wildcatter would succeed or fail—whether he would bring in a producing well or wind up with a dry hole—was just plain luck.

There were some who didn't consider it luck, among them T. N. Barnsdall, one (continued on page 138)Billion(continued from page 94) of the great Oklahoma oil pioneers. Multimillionaire Barnsdall often expounded his favorite theory about what he thought made the difference.

"It's not luck," he maintained stoutly. "A man either has a nose for oil or he doesn't. If he does, he smells the stuff even when it's three-thousand feet down!"

Perhaps. But I rather doubt it myself. Personally, I was never able to sniff out the presence of a subterranean oil pool. Nor do I recall that I ever tingled with an oil dowser's extrasensory response while tramping across a potential drilling site. I still think my early successes were due mainly to pure luck.

However, lest there be those who imagine wildcatters had little to do but wait for the wheel of fortune to spin and then reap their profits, let me say that the oil business was never an easy one. It has always entailed work—hard work—and it has always been fraught with innumerable financial pitfalls, especially in the early days. Wells sometimes blew up, and profits—and often capital—were devoured with appalling speed by costly efforts to extinguish the resulting fires. Dry holes, equipment failures and breakdowns at crucial periods, squabbles and litigation over leases and rights-of-way—these were a few of the myriad problems and setbacks which frequently drained the independent operator's financial resources down to a point well below the danger mark.

In addition, all of us who operated independently often found ourselves facing heavy competition and opposition from major oil firms. Some of these huge companies did not always abide by Marquis of Queensberry rules when they engaged in legal or financial infighting to smother an independent who appeared to be growing too big or too fast.

Wildcatters developed traits and techniques which enabled them to stay in business and to do more than merely hold their own against the petroleum industry's behemoths. We became flexible, adaptable and versatile—adept at improvisation and innovation—if for no other reason than because we had to in order to survive. For example, the big companies employed vast numbers of specialists and consultants, administrative personnel and office workers, housing them in large and expensive offices. We, the independents, found our experts among the hardbitten, veteran oil-field workers who formed our prospecting and drilling crews, or we relied on our own judgment and experience to solve our problems as they arose. We did our own administrative and paper work—keeping both to a minimum. As for our offices, these—more often than not—traveled with us in the mud-splotched automobiles we drove from one drilling site to another.

In my own case, as I have said before, I was lucky—very lucky. I made many profitable deals and brought in several producing wells in the months after I first struck oil on the Nancy Taylor Allotment site. The Getty Oil Company prospered. I was named one of the company's directors and elected its secretary, but this did not mean I exchanged my work clothes for a business suit. Notwithstanding my heady new titles, my work was still in the oil fields—and on the drilling rigs. My role in the company's affairs remained the same as it had been. I bought and sold oil leases, and prospected and drilled for oil.

As the Getty Oil Company's wealth increased, so did my own in proportion to my thirty percent share in the firm—and I was also embarking on profitable ventures on my own account. All these things kept me very busy—too busy to pay more than cursory attention to how much money I was actually making. Then, one day, I stopped and took detailed stock of my financial situation. I suddenly realized that I had gone a very long way toward accomplishing what I'd set out to do in September 1914. I had built the foundations of a business of my own in the American oil industry.

I was not quite twenty-four, but I had become a successful independent oil operator. And I had made my first million dollars. I was a millionaire!

Until then, my life had been devoted chiefly to growing up, obtaining an education and establishing a business. Now, at twenty-four, I found I'd made enough money to meet any personal requirements I might conceivably have in the foreseeable future. I made a headstrong snap decision to forget all about work thereafter and to concentrate on playing, on enjoying myself.

My decision was influenced—at least in part—by the fact that there was a war raging in Europe. Although the United States had not yet entered World War I, I felt certain that American participation in the conflict was inevitable. I'd already filed official applications to serve in either the Air Service—my first choice—or the Field Artillery when and if the U.S. declared war. I was sure it would be only a matter of time before I received my orders, and I wanted to relax and have fun before they arrived.

My mother, father and I had made our permanent home in Los Angeles, California, since 1906. I'd attended school and college in California before going on to Oxford and then, later, starting my business career in the Oklahoma oil fields. I loved California and the easy, informal and extremely pleasant life that prevailed there in those days. Thus, it was only natural that I should choose Los Angeles as the place to enjoy the money I'd made in the oil fields.

"I've made my fortune—and I'm going to retire," I announced blandly to my startled parents.

Neither Mother nor Father was pleased with my decision. Both of them had worked very hard in their own youth. When first married, my mother had continued to work as a schoolteacher to help provide my father with the money he needed to put him through law school. Both of them firmly believed that an individual had to work to justify his existence, and that a rich person had to keep his money working to justify its existence. My father tried to impress upon me that a businessman's money is capital to be invested and reinvested.

"You've got to use your money to create, operate and build businesses," he argued. "Your wealth represents potential jobs for countless others—and it can produce wealth and a better life for a great many people as well as yourself."

I'm afraid I didn't pay much attention to him—then. Later, I was to realize the truth of what he said, but first I had to try things my own way. I owned a spanking new Cadillac roadster, good clothes and had all the money I could possibly need. I had made up my mind I wanted to play, and with these prerequisites, I encountered no difficulty plunging full tilt into the Southern California—Los Angeles—Hollywood whirl of fun and frolic. Although the United States entered the war, my call-up was first delayed, then postponed by bureaucratic snarls, and finally I was informed that my "services would not be needed." I consequently spent the World War I years playing and enjoying myself.

It took me a while to wake up to the fact that I was only wasting time and that I was bored. By the end of 1918, I was thoroughly fed up. Early in 1919, I was back in the oil business—not a little abashed by the "I told you so" smile I got from my father when I informed him that, having retired at twenty-four, I was coming out of retirement at twenty-six!

In 1919, oilmen's attention was already shifting from Oklahoma to Southern California, where new producing areas were being discovered and developed. A great new Oil Rush was in the making, and I was among those who wanted to be in on it from the beginning. My initial oil prospecting venture in Southern California was a fiasco. I drilled my first California well on the Didier Ranch near Puente, but the well proved to be a dry hole.

The luck that had stayed with me in Oklahoma had taken a brief holiday, but it hadn't deserted me. Subsequent tries were considerably more successful. I drilled several wells in the Santa Fe Springs, Torrance, Long Beach and other Southern California areas, and most of them proved to be producers, some of them sensational producers.

I spent most of my time in the field working on the drilling rigs with my men. This habit, formed in Oklahoma, paid many handsome and unexpected dividends. Not the least of these stemmed from the drilling crews' reactions to the presence of a working boss on the job. The men felt they were partners with the boss in a mutual effort, rather than merely employees of some corporation run by executives they never saw and who had probably never set foot on a drilling platform in their lives. Morale—and production—soared as a result.

This was important, for with new wells being drilled by the hundreds throughout Southern California, there was an acute shortage of experienced oilfield workers. The personnel managers of most large companies engaged in wild scrambles to find the necessary manpower for their operations. They bid frantically against each other in the labor market, offering special inducements and benefits to anyone who'd ever had any experience working on an oil rig.

Most oldtimers resented the implication that they had to be bribed with frills to do an honest day's work. They preferred to sign on with wildcatting operators who offered no fancy extras, but who spoke their language and worked side by side with them on the drilling sites.

I'll never forget the time I began drilling on a property not far from the site on which a major oil company was drilling a well. Carrying its employee inducement program to ludicrous extremes, the firm had designed and built what its press agents glowingly described as the last word in drilling rigs.

The entire rig was steamheated all the way up to the crown block. A neatly raked gravel drive led to the site. There were hot showers for the men and even a laundry which washed their work clothes while they waited! Early one afternoon not long after I'd spudded my well, a grizzled roughneck appeared on my site and announced that he wanted to see the boss. When I was pointed out to him, he came over and wasted no words asking me for a job.

"Are you working now?" I asked.

"Yeah." came the sour reply.

"Where?"

"Over there," the roughneck replied, nodding his head toward the de luxe drilling rig. There were no home comforts available for my crew, and I told the man so. And, I added, I couldn't understand why he would want to leave a job that offered such luxuries for one on my relatively primitive operation.

"I've been on that rig for four months." the roughneck growled unhappily. "And we've only gotten down four thousand feet!" I laughed. Four thousand feet in four months was a ridiculously slow rate for drilling through the type of soil formations to be found in that particular field.

"How long do you think it'll take me to get down that far?" I asked.

"From the looks of you—about ten days!" the oldtimer answered with a broad grin. "That's why I'd rather work for you than for that cream-puff outfit over there ...!"

He got the job, and stayed on my payroll for many years. As a footnote to the story, I might add that my well was drilled in record time and proved a good producer. The "last word" in drilling rigs brought in a dry hole and was finally abandoned.

Another good example of what close teamwork and mutual confidence between boss and crew could accomplish can be found in the story of how my men and I licked the "insoluble" problem of a certain oil lease.

The lease was on a tiny piece of property in the midst of a forest of oil wells in the rich Seal Beach, California, field. By some fluke, the lease had been overlooked by the firms which were operating there. A company in which I held a substantial interest acquired the lease, but was about to write it off as a dead loss. Everyone agreed that nothing could ever be done with the property. In the first place, it was a plot barely larger than the floor area of a small house. In the second, the only right-of-way providing access to a road was over a strip of ground several hundred feet long but less than four feet wide. It was impossible to get supplies and equipment to the property by truck over this constricted path. Even if it had been possible, the postage-stamp-sized plot would not have accommodated a regular-sized derrick and drilling rig. The companies holding leases on adjacent properties refused to grant any right-of-way over their sites, for if a producing well was brought in, it might diminish the production of their own wells, since it would be pumping oil from the same pool.

"Forget the lease," associates with whom I discussed the matter advised me. "You'll never get a well drilled there—not in a million years."

Stubbornly, I insisted there must be a way: I put the problem before the men in whom I had the greatest confidence, the members of one of my drilling crews. They listened to me, and their reaction was the same as mine. They considered the problem an irresistible challenge.

"Let's go up and look at things, boss," a hardbitten driller grunted. "We'll find some way—don't worry." Several men and I went to survey the situation firsthand, and we found that it did look fairly hopeless.

"I guess we could drill the well with an undersized rig," the driller mused after thinking things over. "If you could get somebody to design and build it, we could set it up—but I can't figure how we're going to bring everything we need in from the road ..."

The obstacle provided by the limited right-of-way seemed insuperable, until my mind began to turn over the driller's suggestion about a miniature drilling rig. If we could drill with a miniature rig, then why couldn't we solve our transportation problem with a miniature railway? It was a perfect solution. A narrow-gauge track and a car or two on which to bring the disassembled "baby" derrick and supplies and equipment from the road to the drilling site.

Mulish obstinacy? A desire to prove that we were able to accomplish what everyone else considered impossible? Possibly—even probably. But both the miniature rig and the miniature railway were procured. The former was moved in sections over the latter and assembled by hand on the microscopic plot of ground. The well was drilled—and we struck oil.

I recall other memorable strikes during the 1920s. Among them is the one I made in the so-called Athens Field in the southern suburbs of Los Angeles. I acquired the plot in question for something over $12,000. Because I was operating entirely on my own account and knew that I would be stretching my available cash resources thin before completing the first well, I elected to act as my own drilling superintendent. Among the men I hired for my crew were three of the finest drillers in the oil industry: Walter Phillips. Oscar Prowell and "Spot" McMurdo. We completed the first well on February 16, 1925, at a depth of 4350 feet for an initial daily yield of 1500 barrels. A short while later, I brought in the second well on the site for an initial production of 2000 barrels per day. In the next nine years, the two wells on the Athens property were to show over $400,000 excess recovery—clear profit over and above all costs and expenses.

Even more spectacular is the story of the Cleaver Lease in Alamitos Heights, which I bought with a personal check for $8000 in October 1920 from a man who had purchased it for $4000 only a few days before and who wanted to make a quick profit.

I spudded Well Number One on February 21, 1927, and subsequently drilled three more wells on the property. All proved exceptional producers, bringing up a total of more than 17,000 barrels daily. Between 1927 and 1939, excess recovery on the Cleaver Lease wells was nearly $800,000—a ten-thousand percent profit on my original investment. Yet, within a few weeks after the first well came in, I was not only close to losing a fortune, but also close to losing the lease itself. Behind this apparent paradox lie two stories. One illustrates what the average wildcatter faced when he jousted with certain major oil companies. The other proves that while some large firms had no compunctions about strangling an independent operator, others were ready and willing to give him a break—and even a helping hand.

As soon as I'd brought in Cleaver Well Number One—which produced an impressive 5100 barrels a day—I cast about to find a buyer for my crude production. To my dismay, the firms I approached refused to deal with me. The motives behind this evident boycott became infuriatingly clear within a few days, when I received several calls from brokers offering to buy the Cleaver Lease at a very low price. The brokers refused to name the principals they represented.

By then, I was an old hand in the petroleum industry. I recognized all the classic signs indicating a well-organized squeeze play. Certain interests wanted my lease. Either I sold out at a ridiculously low price, or I would be left without any market for the oil produced by the wells on the property.

Unable to sell my oil, I had to find some way to store it. The only storage facilities available in the Los Angeles area were in a defunct refinery—two storage tanks with a total 155,000-barrel capacity, which I immediately leased. In the meantime, even while I was vainly seeking a buyer for the 5100 barrels of crude my Number One Well was producing every twenty-four hours, Well Number Two came in for a 5000-barrel daily production. This was followed in short order by Number Three, which produced 5100 barrels a day, then by Number Four, the runt of the litter, which brought up 2100 barrels daily.

This production rate was rapidly filling the two storage tanks—and I was still unable to find an outlet for the oil. I knew that when the tanks were topped off, I'd have no choice but to shut down my operation entirely.

Obviously, I was receiving no income from the four wells. My fluid cash resources—already strained by drilling costs—dwindled rapidly as I paid for leasing the tanks and for trucking my crude several miles from wells to storage. The situation could have easily turned into financial disaster. I decided to make a frontal attack on one of the biggest of all the major oil companies—Shell Oil. By a fortunate coincidence, Sir George Legh-Jones, then the Shell Company's president, happened to be visiting in Los Angeles. In desperation, I aimed high, asked for an interview with him personally, and was informed that he would be happy to see me.

A warm, friendly man, Sir George listened attentively to what I had to say. The deepening scowl that etched across his face as he heard me was all the proof I needed that his firm was not a party to the boycott and that he heartily disapproved of such tactics. When I finished talking, he smiled his reassurance.

"Relax," he grinned. "We'll help you."

As a starter, the company would buy the next 1,750,000 barrels of crude oil produced by my Cleaver Lease wells, Sir George told me. In addition, a pipeline would be constructed to link my wells with the Shell Oil Company's pipeline network—and construction work was to commence the very next day.

Sir George and the Shell Company were as good as their word. Shell's work crews arrived on my Cleaver site bright and early the following morning and started to lay the pipeline. The boycott was broken—and the Cleaver Lease was safely and profitably mine!

As the 1920s drew to a close, the American petroleum industry began to undergo a radical change. The industry was rapidly growing more complex; the costs of finding and producing oil were spiraling ever higher. Much greater capital expenditures were needed to purchase leases, machinery and equipment and to finance exploration and drilling. Most oil pools that lay near the surface in known oil belts had been located and were being exploited. It was necessary to prospect ever farther afield and to drill ever deeper to find oil.

There were many mergers and consolidations of oil companies. Some independent operators were falling by the wayside. Others were selling out to big oil companies. There was also a strange, ominous undercurrent running through the entire U.S. economy. The Stock Market listed shares at fantastic highs, but there were warnings and forebodings of economic trouble ahead.

It was a critical period for all wildcatters and a particularly difficult one for me. I had to look after my own mushrooming business interests—my own leases, producing wells and companies. Then, through the years, I'd bought sizable blocks of slock in my father's companies as well. Now, his health began to fail, and I found it increasingly necessary to take an active part in managing the operations of these companies.

In 1929, the Stock Market crashed. The following year, my father suffered a stroke. Although he was over seventy-five, he fought death bravely and grimly for several weeks, but the battle was lost on May 31, 1930, when he passed away. My mother and I were allowed but little time to grieve. We had to keep his businesses going and his companies operating. The Federal Government pressed for rapid settlement of the inheritance taxes on the estate. These and many other matters demanded immediate attention and all were complicated by the economic factor of the deepening Depression. Many advised me to liquidate everything—to sell out not only my late father's holdings, but my own firms and interests as well.

"The business situation can only get worse," they predicted. "The economy is going to disintegrate completely!"

I didn't see things that way at all. I was convinced the nation's economy was essentially sound—that though it might sag lower in the near future, it would eventually bounce back, healthier than ever. I thought it was the time to buy—not sell.

Many oil stocks were selling at all-time lows; they were spectacular bargains. I began to envision the organization of a completely integrated and self-contained oil business, one embracing not only exploration and production—the operations in which I'd been exclusively engaged until that time—but also transportation, refining and even retail marketing.

In business, as in politics, it is never easy to go against the beliefs and attitudes held by the majority. The businessman who moves counter to the tide of prevailing opinion must expect to be obstructed, derided and damned. So it was with me when, at the depths of the U.S. economic slump of the 1930s, I resolved to make large-scale stock purchases and build a self-contained oil business. My friends and acquaintances— to say nothing of my competitors—felt my buying spree would prove a fatal mistake. Then, when I announced my intention to buy into one of the seven major oil companies operating in California, even those who had been my supporters in the past were inclined to believe I had taken leave of my senses.

Major oil companies could, and often did, buy out independent operators' firms. But for an independent operator to buy a major oil company? That was heresy—an attempt to turn the established order upside down!

Nonetheless, I went ahead with my plans, for I was looking to the future. The oil companies I controlled or in which I held substantial interests were engaged exclusively in finding oil and getting it out of the ground. To insure markets for this oil and for that to be produced by new wells drilled in the future. I had to invest in a company which needed crude oil and which also had adequate refining and marketing facilities. There were only seven such companies in California—all majors.

The list was headed by the Standard Oil Company of California—obviously far too big a chunk for any independent to bite off and digest. The same held true for the Shell Oil Company. The next possibility was the Union Oil Company, but this firm had its own crude-oil sources. So did the General Petroleum Company which, in any event, was virtually a closed corporation, and its stock was not available for purchase. That left three firms: Richfield Oil—then in receivership and consequently not a very tempting prospect; the Texas Oil Company, which was amply supplied with its own crude; and, lastly, the Tide Water Associated Oil Company.

Tide Water Associated seemed the logical choice. The company met only half its refineries' crude requirements from its own reserves, buying the rest from other producers. Tide Water also had a good marketing organization and its products enjoyed a good reputation with the consuming public.

I saw great advantages in linking my companies up with Tide Water. My firms—George F. Getty Inc., and Pacific Western Oil Co. among them—would have assured outlets for their crude production, and they would guarantee steady crude oil supplies for Tide Water's refineries. Furthermore, with the firms working interdependently, large-scale economies could be effected. The savings could be passed on to the consumer in lower gasoline and oil prices and shared by Tide Water's 34,668 individual shareholders in the form of higher dividends.

I began my Tide Water campaign in March 1932, by purchasing 1200 common shares at $2.50 per share. Within the next six weeks, I'd increased my holdings to 41,000 shares. Nearly twenty years were to pass before I gained clear-cut control of the firm. In that time, my producing companies and I would buy millions of shares of Tide Water common. I didn't guess wrong when I started buying at depressed 1932 prices. In the next five years, Tide Water's common shares rose to more than $16—and eventually each share came to be worth many times that amount.

It was not easy to gain control of the Tide Water Associated Oil Company. Many risks were taken, much opposition encountered, many no-holds-barred proxy and legal battles were fought. Countless critical situations developed. The outcome was often in doubt.

My first attempt to obtain a voice in Tide Water's management was made in May 1932. I went to the annual stockholders' meeting armed with my own 41,000 shares, plus a proxy for 126,000 additional shares. At the last moment, the proxy was revoked. My efforts ended in failure. I bought more stock and tried to sell my ideas to Tide Water's directors. They, however, did not see things my way and dug in for a long, hard fight. Why? Well, I suppose there were several reasons. First of all, I was an outsider. I'd had little or no experience in the heady atmosphere of board rooms.

"Paul Getty should stay where he belongs—on a drilling rig" a Tide Water director supposedly snorted when told I was buying the company's stock right and left. I fear there were others on the board even less kindly disposed toward me and my ambitions.

I'd studied Tide Water's organization and operations carefully and recommended that the company make certain changes and practice certain economies. These recommendations, apparently too radical to suit the conservative directors, caused considerable resentment.

I'd also concluded that much of Tide Water's refining plant was obsolescent and would soon be obsolete. I believed the company should make provisions for modernization and replacement, but management was reluctant to make capital expenditures during the business slump. The directors called it "necessary caution." I viewed it as shortsighted and dangerous penny-pinching.

By 1933, Getty interests owned nearly 260,000 Tide Water shares—a block too large to be ignored. I was elected to the company's board, but it was a hollow victory. I was only one among many, and the other directors were still ranged solidly against me and my proposals. I continued to buy Tide Water stock. Proxy fights, lawsuits and countersuits ensued. Injunctions, restraining orders and writs flew in blizzards. By late 1937, Getty interests owned enough stock to obtain a voice in management. Three years later, we held 1,734,577 shares—a shade over one-fourth the voting stock, and many changes I proposed were being implemented. By 1951, I held enough Tidewater stock to have numerical control. (By then, the "Associated" had been dropped from the company name and "Tide Water" contracted into a single word.) Two years later, with all but one director elected by Getty interests, the campaign was finally over. Today, Tidewater's assets exceed $800,000,000.

In 1938. I turned momentarily from the oil business and bought the Hotel Pierre in New York City, purchasing it for $2,350,000, less than one-fourth its original, 1929–1930 cost. Later, I bought several hundred acres of land in Acapulco, Mexico, where I eventually built the Pierre Marques Hotel on Revolcadero Beach. These, contrary to reports which have me owning a string of hotels, are the only ones I own.

In 1937, as part of the Tide Water campaign, I obtained control of a firm known as the Mission Corporation. Among Mission's holdings was a fifty-seven percent interest in the Skelly Oil Company, a major oil firm with headquarters in Tulsa, Oklahoma. Thus, almost as a windfall, I acquired the controlling interest in a company with a 1937 net income of $6,400,000—and which, today, has more than $330,000,000 in assets.

But this is not the whole story. Among Skelly Oil's subsidiaries was the Spartan Aircraft Corporation, a Tulsa concern engaged since 1928 in manufacturing aircraft and training pilots and navigators. I paid my first visit to the Spartan plant on December 7, 1939. Its aircraft manufacturing operations were rather limited; there were only some sixty workers employed in the factory. The pilot training school was much more active. It was, in fact, the largest private flying school in the U.S.

I'd just returned from a trip to Europe, which was already at war. I was convinced that the United States would eventually have to throw its weight into the war against the Axis. Consequently, I felt Spartan Aircraft would have an increasingly important role in the nation's defense program—but I could not guess then how very important it was destined to be.

Two years to the day after my first visit to Spartan, the Japanese attacked Pearl Harbor and the United States was at war. It was in that same month that my beloved mother died. It was a heavy blow. Although I was by then almost fifty, I felt the loss as keenly as though I had still been a youngster.

War news filled the newspapers. I had not been allowed to serve in World War I, and I now hoped for the chance to serve in the second world conflict. I had studied celestial navigation and had owned—at various times in my life—three yachts, the largest a 260-foot, 1500 tonner with a crew of forty-five. On the basis of this, I volunteered for service in the United States Navy. To my chagrin, I was politely but firmly informed that the Navy didn't have much use for a middle-aged businessman unless he was willing to take a routine, shore-based administrative job. After exhausting all other avenues, I obtained an interview with Navy Secretary Frank Knox and pleaded my case. I told him I wanted a Navy commission and sea duty.

"You qualify for a commission as an administrative or supply officer," Secretary Knox declared. "But sea duty is out of the question." He paused and studied me closely. "I understand you own the Spartan Aircraft Corporation," he said after a moment. I agreed that I did.

"The Armed Forces must have every aircraft factory in large-scale production as soon as possible," he told me. "The most important service you can render the war effort is to drop all your other business interests and take over direct personal management of Spartan."

I arrived in Tulsa as the working president of Spartan in February 1942. There was a tremendous amount to be done and very little time in which to do it. Manufacturing facilities—including factory space—had to be expanded, machinery and tools obtained, engineers and technicians recruited and workers hired and trained by the thousands. Despite bottlenecks, shortages and setbacks, peak production was attained in less than eighteen months.

I remained in active and direct charge of Spartan's operations throughout the war. Before it ended, the Spartan flying school was training as many as 1700 fledgling aviators at a time. By V-J Day, the Spartan factory—employing more than 5500 workers at the peak—had turned out a vast array of airplane parts and components on subcontracts from major aircraft firms. Among these were: 5800 sets of elevators, ailerons and rudders for B-24 bombers; 2500 engine-mount sets for P-47 fighters; Curtiss dive-bomber cowlings by the hundreds; Douglas dive-bomber control surfaces by the thousands; wings for Grumman Wildcat fighters; tail booms for Lockheed P-38 pursuits. Spartan also produced N-1 primary trainers on prime contract.

Spartan's production record brought high commendations from the Armed Forces—tributes to the efficiency and loyalty of the men and women who'd worked for the firm and who did their part in helping to win the war.

I stayed on at Spartan until 1948 to nurse the firm through the pangs of reconversion to peacetime production of house trailers. Then once more I went back to my first and greatest business love—oil.

My oil companies were prospering and were larger and more active than ever before, but it was time for additional expansion. Vast demands had been made on America's oil reserves by the war, and postwar petroleum consumption was rising sharply throughout the world. Oil prospectors were fanning out—to Canada, Central and South America, Africa and the Middle East—searching for new oil sources. Instinct, hunch, luck—call it what you will—told me the Middle East was the most promising locale, the best bet, for oil exploration. I had almost obtained an oil concession in the Middle East in the 1930s, but had allowed my chance to go by. Now I decided to seek a concession to prospect and drill there and make up for the opportunity I had lost. In February 1949, my company obtained a sixty-year concession on a half interest in the so-called Neutral Zone, an arid, virtually uninhabited and barely explored desert region lying between Saudi Arabia and Kuwait on the Persian Gulf.

The concession was granted by His Majesty, Ibn Saud, King of Saudi Arabia. In immediate consideration for the right to explore and drill for oil in the Neutral Zone, I paid the Saudi Arabian Government $12,500,000. It was a gargantuan risk, and many people in the petroleum industry once again openly predicted I would bankrupt my firms and myself.

Four years and $40,000,000 were needed before we brought in our first producing well in the Neutral Zone. But, by 1954, 1 could relax and enjoy a private last laugh at the expense of those who had prophesied my ruin. The Neutral Zone has proved to be one of the world's most valuable oil properties. Well after well has come in, and petroleum geologists conservatively estimate proven reserves in places in the region covered by my concession to exceed thirteen billion barrels!

With this tremendous reserve and with producing wells in the Middle East and elsewhere bringing up millions of barrels of crude oil annually, it has been necessary to expand even further in other directions. My companies have had to build and buy additional refineries to handle the enormous crude-oil production. Pipelines, storage facilities, housing projects for workers and innumerable other installations and facilities have been built or are a-building.

A $200,000,000 Tidewater Oil Company refinery was completed at Wilmington, Delaware, in 1957. Another Tidewater refinery near San Francisco has been modernized at a cost of $60,000,000. There is a new 40,000-barrel-a-day refinery in Gaeta, Italy, and another with a 20,000-barrel-a-day capacity in Denmark.

In 1954 and 1955, construction began on the first vessels in a (fleet of supertankers. Several of these have been completed and are even now in operation. This tanker construction program is proceeding apace. Tonnage afloat and now under construction exceeds one million deadweight tons. Among the ships are truly giant supertankers displacing upwards of seventy thousand tons.

My firms have recently built spanking-new office buildings in Los Angeles, California; Tulsa, Oklahoma; and New York City—at a cost approaching $40,000,000. Regardless of what they produce, plants and businesses owned by Getty interests are orientated to steady expansion. Management is constantly seeking ways and means to increase output, and large-scale projects are under way to develop new products and to find new applications and uses for old ones. By no means the least of the activities in which my companies are engaged are oil and mineral explorations, which are being conducted energetically on four continents.

This, then, is the story of how I chose my road to success and how I traveled it from my wildcatting days in the Oklahoma oil fields, of how I've built my business and made my fortune. To it, I would like to add a brief, highly personal—and mildly rueful—footnote.

For years I had managed—at least on the whole—to avoid personal publicity. Or rather, since I did nothing either to seek or evade it, I suppose it would be more accurate to say that personal publicity avoided me. This state of peaceful near-anonymity ended suddenly and forever in October 1957, when Fortune magazine published an article listing the wealthiest people in the United States. My name headed the list, and the article labeled me a billionaire and "The Richest Man in America." Subsequently, other publications gave me the even more grandiloquent title of "The Richest Man in the World."

Since then, I've been besieged by requests to reveal exactly how much money I have. I'm seldom believed when I reply in all honesty that I don't know, that there is no way I can know. Most of my wealth is invested in the businesses I own or control; I make no claims about the extent of my wealth, and I really don't care how rich I am.

Today, my companies are thriving, and they're carrying out ambitious programs for further expansion. My primary concern and main interest lie in making certain that my companies continue to grow so that they can provide more employment and produce more goods and services for the benefit of all.

My associates and I are convinced that the over-all economic trend is up and that despite the alarums and fears plaguing our era, the world is on the threshold of a prosperity greater than any in its history. We want to contribute our part to bringing this prosperity about—and to share in it, along with all peoples in all countries throughout the world.