BAKU SURPASSED BY AMERICA.

207

tain at Baku and became the possessors of the largest flow of oil. So fast grew the stock that the price dropped from forty-five copecks to five copecks per pood, above which it has only advanced occasionally since. A year later the Transcaspian Trading Company was established, with a capital of half a million sterling, to develop the resources of the Caspian region, and transforming itself into the Baku Petroleum Company, took the lead in the oil business. Finally, in 1875, Robert Nobel started a refinery at Baku, and, in conjunction with his brother Ludwig, organized in a few years a huge concern which overshadows not only Meerzoeff and the Baku Petroleum Company, but the whole of the well owners and oil refiners put together.

In most countries reforms are never so sweeping as they ought to be. In the case of that at Baku the monopoly was removed, but an excise duty was imposed, which involved a fresh check upon the industry. Still it rapidly advanced, and a considerable amount of capital was thrown by Russians into the undertaking.

It will be seen that there was a considerable fall in price from the £3 10s. exacted the last year of the

Since the Crimean war the rouble has fluctuated so much in value that it is impossible to give the exact English equivalents throughout. I have reckoned the rouble from 1872 to 1877 at the average value of half a crown. The Russian prices were:-1872, forty-five copecks

the pood; 1873, five copecks; 1874, four copecks; 1875, ten copecks; fo

1876, five copecks; and 1877, eight copecks the pood.

208

monoply period. In 1877 the excise duty was abolished, at the recommendation of a special commission presided over by Prince Leuchtenburg, and the industry left without any tax or restriction. The following statistics will give an idea of the industry when this revolution was accomplished. Total production of crude oil in 1877, 242,000 tons; number of drilled wells 130; price of crude oil 12s. 6d. per ton; excise duty paid throughout the whole period from 1873 to 1877, 1,245,954 roubles or about £160,000; number of refineries 150; quantity of oil refined 74,000 tons.

Rid of the monoply and excise, the industry at once rapidly advanced with acclerated speed; but its progress would have never been so remarkable as it has been, but for the marvellous system of transport organized by two Swedish engineers, Robert and Ludwig Nobel.

These colossal exploiters had already commenced operations in 1875, anterior to the abrogation of the excise duty; but it was not until afterwards that their operations began to exercise any marked effect upon the output of oil. The revolution they accomplished inaugurated what Russians call the Nobelevski, or Nobel period. extending up to the present day.

PRODUCTION AND PRICE OF CRUDE PETROLEUM DURING THE NOBEL

PERIOD.

1882

680,000

1883

800,000

Price

per Ton.*

8/8

63

3/8

2/6

2/6

2/6 to 031

Since 1878 the rouble, on an average has been worth about The Russian prices for these years were:-1878, seven copecks pood; 1879, five copecks; 1880, three copecks; 1881 and 1882, copecks; and 1883, from two copecks to a quarter of a copeck pood.

1875

wells |

1218

1976

1879

17

1382

50

1583

65

PD

400

From the present year will probably date a fresh epoch in the petroleum industry-the Batoum period. Up to the summer of 1883 Caspian petroleum only found its way to Europe via the Volga and Western Russia, traversing more than 2,000 miles in steamers and tankcars before reaching the holds of foreign vessels. The construction of the Batoum line reduced this distance to 560 miles at a stroke, and laid the industry open to the civilized world.

210

CHAPTER XIV.

THE OIL FOUNTAINS OF BAKU.

Number of Wells in Baku and America Compared-One Baku Well Yielding More than all the American Wells Put Together-A Million's worth of Oil from a Single Well-Description of a Baku Petroleum Fountain-The Droojba Spouting Well-Mode of Boring for Oil. The Balakhani Drilled and Pumping WellsCost of Sinking a Well-Price of Land at the Oil Fields-The Kalpah, or Well-stopper-Storing the Oil-The History of the Oil Fountains during the last Ten Years-Subterranean Explosions-Six Hundred Thousand Gallons of Oil in Twenty-Four Hours-Enormous Waste of Petroleum-The Fire at Krasilnikoff's Wells-A Sand Volcano 400 Feet High-Account of the Droojba Fountain-A Liquid Grindstone-Gagging the Wells at Baku-Statistical Account of the Oil Wasted by the Droojba Fountain-Science and the Oil Fountains at Baku-Their Effect on Commercial Men-Necessity of Placing the Fountains Under the Control of the State.

IN America there are over 25,000 drilled petroleum wells. Baku possesses 400. But a single one of those 400 wells has thrown up as much oil in a day as nearly the whole of the 25,000 in America put together. This is very wonderful, but a more striking fact is, that the copiousness of the well should have ruined its owners, and broken the heart of the engineer who bored it, after having yielded enough oil in four months to have realized in America at least one million sterling.

"In Pennsylvania that fountain would have made its owner's fortune; there's £5,000 worth of oil flowing out