Official report to the House of Representatives of the 58th Legislature of Texas Page: 90 of 94
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unnecessary drilling. In operation marginal wells also
flow oil at a higher cost per barrel than wells, which
further boosts industry costs.
The same rules, critics charge, have set up a tempting
target for crooks. Since wells can be sunk close together,
a slanter often has only a short distance to drill to strike
somebody else's oil. Once he does, it's easy for him to
choke the flow to a few barrels a day--thus bringing in a
profitable, if illegal, marginal well.
Some broad reforms, however, are now under way. Well
spacing rules are getting particular attention because many
oil men agree with L. F. McCollum, president of Continental
Oil Co., that the slanthole scandal wouldn't have occurred if
Texas wells had been broadly dispersed.
Potentially, more important, the scandal has added fuel to
a controversy over the whole production-quota policy. Only
four other states set similar quotas, and these are less strict.
With the Railroad Commission nevertheless curbing Texas output
severly to preserve the state's role as the "balance wheel"
for the whole U. S. oil economy, Texas' share of national output
has shrunk from 45% a decade ago to last year's 35% slice.
The commission has also amended Rule 54 to provide much stricter controls
on directional drilling, has acquired five tools for inclination surveys, has taken
steps to increase greatly its field staff for enforcement procedures, and has
commenced a study looking toward improvement of all its methods and procedures.
These actions indicate that the Railroad Commission is making a genuine effort
to correct weaknesses in its administration. The commission and all of its personnel
have been most cooperative toward this Committee in all of its efforts. It should
also be noted that while shocking instances of corruption have been exposed, these
have involved only a tiny number of employees and the tremendous majority have
been found to be loyal hard-working and honorable public servants.
Colonel Homer Garrison and the Department of Public Safety, the attorney
general and his staff, should be commended for the valuable contributions they have
made to the exposure of the whole slant-hole scandal. From the time they were
first called into the investigation a few short months ago, their actions have been
most vigorous and effective, and have resulted in the exposure of the corrupt scheme
which had flourished for so many years.
No words of praise can adequately describe the superb job performed by the
Intelligence Section of the DPS which is headed by O. N. Humphreys. Intelligence
Agent George Read, working virtually around the clock for months on end, contributed
materially to the success of the investigation.
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Texas Legislature. House of Representatives. General Investigating Committee. Official report to the House of Representatives of the 58th Legislature of Texas, book, 1963; Austin, Texas. (texashistory.unt.edu/ark:/67531/metapth5869/m1/90/: accessed June 26, 2017), University of North Texas Libraries, The Portal to Texas History, texashistory.unt.edu; .