High-Flying Horse

At Manhattan's 26 Broadway, citadel of the old Standard Oil Trust until its dissolution in 1911, the directors of Socony-Vacuum Oil Co. last week trooped into their paneled meeting room, eased into leather chairs beneath John D. Rockefeller's portrait and listened to a report of Socony-Vacuum's 1951 profits that would have amazed old John D.

The most that Rockefeller's whole trust had ever earned, in its heyday, was $83 million. In 1951, Socony-Vacuum, representing merely two of the 34 units into which the Supreme Court split the trust, earned nearly twice as much--a thumping $160 million ($5 per common share) and a 25% gain over 1950. At the news, Socony's directors declared a March dividend of 50-c-, up 25% from the last quarter, and Socony's stock pushed up to 40. Just ten years ago it sold at 6 1/8.

Wall Streeters had long looked down their noses at Socony-Vacuum, in spite of the fact that it has become the second biggest oil company in the U.S. in refining capacity.* The major reason was that Socony-Vacuum had grown up as primarily a marketing rather than producing organization. To inflation-wary investors, Socony looked a bit like a skinny stepsister of oil-rich Standard of N.J.

But Socony's President Benjamin Brewster Jennings, 53, and apple-cheeked Chairman George V. Holton, 61, have changed all that. In the six postwar years, they have plowed $570 million into exploring and developing new fields, drilled 3,686 producing wells and 628 dry ones, developed more new oil reserves than any other U.S. company. As a result, Socony's proved domestic reserves have climbed from 1,121,000,000 bbls. in 1946 to 1,641,000,000. It has tapped an immense pool in its Pegasus Field in Texas, is one of the biggest explorers in North Dakota's promising Williston Basin, and has 6,800,000 acres on lease in Canada. It is already producing at its Duhamel field in Alberta, and a month ago brought in the new Roseray well in southern Saskatchewan.

Brewster's Millions. Longtime associates of unassuming Brewster Jennings fondly call him "a rich man's son who made good in spite of it." Both his paternal and maternal grandfathers, Benjamin Brewster and Oliver B. Jennings, had helped stake John D. Rockefeller, became his partners in running the Standard Oil Trust and left huge fortunes.* As one of their heirs, young Jennings, after graduation from Yale in 1920, had no trouble landing a job with Socony (then Standard Oil Co. of New York) as a clerk in the marine department. Soon he was purchasing agent, then real-estate manager, became assistant to President John A. Brown, and stepped into his shoes at Brown's death in 1944.

Jennings shares command with Chairman Holton, a onetime $5-a-month law clerk who became general counsel of Vacuum Oil Co., another result of the trustbusting, and moved into 26 Broadway in 1931, when Socony and Vacuum merged. Jennings' hobby is woodworking. When he discovered that Chairman Holton's gavel was missing, he took an old table leg and turned him a new one on his lathe. The gavel is used sparingly, for both men rule Socony largely by committee (the board and the four-man executive committee) ; it is too large to do otherwise.

Socony's Kingdom. Socony's Flying Red Horse is the symbol of 49 subsidiaries and refineries that spread over all Europe and Asia,* as well as the U.S. and South America. Because of its spread, the empire took a beating in World War II. The Luftwaffe smashed its English lubricating plant, the R.A.F. its German and French refineries, and the Fascists confiscated those in Italy. After the war the Russians grabbed its plants in Poland, Rumania and Czechoslovakia. In spite of these setbacks, the Red Horse's wings are bigger than ever. The Japanese refinery and virtually all its West European refineries are working again. Socony and a British partner are building a new one in England. It is expanding production in Venezuela and Colombia; its bigger U.S. output more than makes up for European losses. Socony shares both the Trans-Arabian and Kirkuk-Tripoli pipelines, is the only U.S. producer in Egypt.

To keep track of the empire, Jennings and Holton need a map the size of a whole wall, operate their own private state department, frequently hear about turmoil in distant lands before the Government. Like all U.S. oilmen, they worry over the stirrings in the Middle East, the free world's greatest oil reserve. But they believe that U.S. companies, by generous dealings and farsighted statesmanship, can avert the disaster which overtook Britain in Iran. Says Chairman Holton: "In another 25 years or so, atomic power, or even solar energy, may diminish the importance of oil as motive power. But until they do, the Western world cannot survive without the Middle East."

*Outranked only by Standard Oil (X.J.).

*Jennings and Brewster both worked as clerks at what is now Manhattan's Browning King clothing chain, joined the 1849 California gold rush, started their own Jennings & Brewster store in San Francisco. They sold out in 1862 for $150,000 each, used the money to back. John D.

*Socony and its ex-sister, Jersey Standard, split their Far East markets in a 50-50 subsidiary, Standard-Vacuum, and the Middle East through their joint ownership of a 23 3/4% interest in Iraq Petroleum Co. in 1948, Jersey, Standard Oil of California and the Texas Co., joint owners of Arabian American Oil Co., dealt Socony in for a 10% share for $26 million.

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