PETROLEUM. 
7 
tic arising from the peculiar nature of petroleum. In most other 
industries, to cite the most striking distinction, transportation over 
alien lines separates the producing activity from the manufacturing 
activity, creating a break between continuity of operations; in the 
case of petroleum, however, the liquidity of the crude product adapts 
it to specialized transportation through pipe lines, themselves a part 
of the resource development. In consequence, the petroleum indus- 
try in its ideal form represents a type of industrial activity more 
highly coordinated than other industries of the present day, afford- 
ing, therefore, an important object lesson for constructive considera- 
tion. 
The petroleum industry, in point of fact, however, is not coordi- 
nated throughout, but at present breaks into two portions, by no 
means in complete adjustment — the production of petroleum and the 
handling of petroleum with its threefold aspect of transportation, re- 
fining, and distribution. The conditions of producing crude petroleum 
are wholly different from those involved in its treatment after it is 
above ground. This is reflected in the circumstance that over 15,000 
individual companies are engaged in the mining of petroleum, while 
the organizations concerned with the handling of the product are 
numbered by a few hundred. A large part of the crude production, 1 
therefore, appears above ground through the efforts of a great many 
small operators, while the bulk of the transportation, refining, and 
distribution is taken care of by a very few large organizations. 
PRODUCTION. 
Petroleum is won in commercial quantities through wells drilled to 
varying depths into the crust of the earth. The drilling is commonly 
done by means of a heavy string of tools suspended at the end of a 
cable and given a churning motion by a walking beam rocked by a 
steam engine. This method is known as the standard or percussion 
system of drilling. The steel tools, falling under their own weight, 
pulverize the solid rock encountered and literally punch their way to 
the depth desired. To prevent the caving in of the hole, but espe- 
cially to avoid the inflow of water from water-bearing formations, the 
well is lined or “ cased ” wholly or in part with iron piping, which is 
inserted in screw- joint sections at intervals during the drilling and 
forced down to positions needful of such protection. The well does 
not taper, but if deep changes to successively smaller bores at several 
points, resembling in section a great telescope. 2 
1 Estimated roughly at four-fifths. 
2 The drilling of an oil well is graphically described by George Fitch in the following 
paragraph : 
“An oil well is a hole in the ground about a quarter of a mile deep, into which a man 
may put a small fortune or out of which he may take a big one. And he never knows 
