Mexican Eagle Petroleum Company
Encyclopedia
Compañía Mexicana de Petróleo El Aguila SA, (El Aguila for short), called in English the Mexican Eagle Oil Company or Mexican Eagle Petroleum Corporation, was a Mexican oil company in the 20th century.
, Bart.
(Viscount Cowdray
from 1910) founded the company in 1909 to develop his investments in the Mexican oil fields.
Pearson's interests in Mexico had begun in 1889 when he won a contract from the government of Porfirio Díaz
for his civil engineering company, S. Pearson and Sons Ltd, to build the Gran Canal in Mexico City
. This was followed by contracts in 1895 to build a harbour at Veracruz and in 1896 to build the Tehuantepec Railway. Pearson diversified into mining, landholding, transport and electrical utilities around Veracruz. He and the engineer F.S. Pearson
(no relation) founded the Mexico Power and Light Company, which provided Mexico City's first public electricity supply. Pearson's businesses and government contracts put him in a favourable position with members of the Díaz dictatorship.
Oil production in Mexico was begun in 1901 by a US oil investor, Henry Clay Pierce. He was quickly followed by a rival, Edward L. Doheny
, in the same year. Pearson's land surveys in the vicinities of Pedregal and San Cristóbal for the route of the of the Tehuantepec Railway had reported oil seepage from the ground, so in April 1901 he ordered his manager in Mexico to secure prospecting options on "...all land for miles around". Pearson built a refinery, pipelines and port facilities to handle the oil in 1905–06, but his company didn't make a major oil strike until 1908. In the same year one of Pearson's oil strikes caught fire and burned out of control for eight weeks, destroying the entire oil field
.
In 1909 Pearson founded the Compañía Mexicana de Petróleo El Aguila SA ("Mexican Eagle Oil Company") in Mexico to take over S. Pearson and Sons' oil interests. This followed Pearson's creation of Whitehall Securities Corporation Ltd. in the UK in 1908 to manage all of S. Pearson and Sons' investments outside the oil industry. Pearson's prospecting continued without success until 27 December 1910, when a well on the Gulf of Mexico
coast between Veracruz and Tampico struck oil that flowed at a rate of 100,000 barrels per day. This single well turned the fortunes of Pearson's oil business. Within a few years he was one of Mexico's two major oil magnates, the other being Doheny. Other oil companies from the USA and Europe had entered the Mexican oil industry but Doheny and Pearson's companies remained pre-eminent until after the First World War
.
In 1911 the Mexican revolution
overthrew the Díaz dictatorship that had favoured Pearson, ending the civil engineering contracts for which he had first become involved in Mexico. However, Pearson had exclusive rights to prospect for oil in several Mexican states and by 1914 the company 1500000 acres (6,070.3 km²) of prospecting rights, 175 miles (281.6 km) of pipeline, two refineries (the second being newly built at Tampico) and storage for seven million barrels of oil.
By June 1913 Mexican Eagle was the largest company in the Pearson group, with net assets valued at £6.8 million. However, in December 1918 Pearson claimed in a letter to the UK Chancellor of the Exchequer
, David Lloyd George
, that Mexican Eagle was worth £8 million. Mexican Eagle was the largest contributor to the Pearson group's valuation in 1913 of £17 million, which made it the seventh largest business in the UK and among the 30 largest businesses in the World. By 1919 the Pearson group was worth £29.6 million, of which in June of that year Mexican Eagle made up £13.4 million. To what extent this represents a growth in value must be considered against the degree of inflation that took place in the First World War. However, in 1919 the Pearson group's share value was £79.1 million, of which Mexican Eagle made up £62.6 million. This made Mexican Eagle roughly the equal of Burmah Oil and far bigger than the Anglo-Persian Oil Company
or Shell Transport and Trading.
offered to buy his oil interests. In 1912 and 1913 he declined buyout bids from Royal Dutch Shell
. and in 1913 and 1916 he declined bids from Standard Oil of New Jersey
. By 1916 Pearson was keen to sell, but the UK Government persuaded him for strategic reasons not to do so. Pearson asked the UK Government to buy 50% of his oil interests, but it responded in 1917 by imposing restrictions that prevented him from transferring ownership as long as the war continued. The Constitution of Mexico
adopted in 1917 nationalised oil deposits.
In October 1918, a month before the Armistice, Calouste Gulbenkian
started negotiations with Pearson for Royal Dutch Shell to buy Mexican Eagle. On April 2, 1919 the Royal Dutch Petroleum Company and the "Shell" Transport and Trading Company jointly bought Mexican Eagle for US$
75 million.
Mexican Eagle was the dominant firm in the Mexican petroleum industry until March 18, 1938, when the government of Lázaro Cárdenas
nationalized it, changing its name to Petróleos Mexicanos (Pemex).
Petróleos Mexicanos formally dissolved itself on May 24, 1963.
on the River Tyne
launched SS San Cristobal (2,041 tons) in 1906 and Swan Hunter
, also on Tyneside, launched SS San Antonio (5,251 tons) in 1909. Pearson also bought SS James Brand (3,907 tons), which had been built by Armstrong Whitworth in 1893, and renamed her San Bernardo.
In 1912 Pearson founded the Eagle Oil Transport Company
in the UK to take over his ships and carry Mexican Eagle's products and the Anglo-Mexican Petroleum Company in the UK to sell Mexican Eagle's products outside Mexico.
Eagle Oil Transport immediately ordered 20 modern steam tankers at a cost of £
3 million. Eagle Oil Transport lost a number of ships to enemy action in the First World War. After the First World War, Eagle Oil Transport renewed and expanded its fleet. It bought numerous new tankers, including six of about 13,000 tons each. When Royal Dutch Shell bought Pearson's oil interests, that included Eagle Oil Transport and Anglo-Saxon Petroleum as well as Mexical Eagle Petroleum.
In about 1930 the Eagle Oil Transport Company was renamed the Eagle Oil and Shipping Company
. In about 1935 the company started adding a new generation of motor tankers of about 8,000 tons each.
Eagle Oil and Shipping was registered in the United Kingdom. Therefore after 1938 although the Mexican government had nationalised Mexican Eagle Petroleum, Eagle Oil and Shipping remained a subsidiary of Royal Dutch Shell. After 1938 the fleet continued to carry oil from the Gulf of Mexico
to the UK. During the Second World War
the company played an important role in supplying petroleum and petroleum products to the United Kingdom. Oil tankers were a particular target in Germany's economic warfare against the UK. Enemy action sank 17 Eagle Oil's ships and killed at least 206 officers, men and DEMS gunners serving aboard them.
Among the ships lost was (8,073 tons), which was famous for surviving a naval bombardment by the German heavy cruiser
Admiral Scheer in 1940 that set the tanker on fire. San Demetrio was repaired and returned to service, but the U-boat
U-404 torpedoed and sank her in the western Atlantic off Virginia
in 1942 with the loss of 19 lives.
In 1942 the Ministry of War Transport placed a number of Empire ships under Eagle Oil and Shipping's management. One was sunk by enemy action in 1943 but after the war the company bought two of the surviving ships from the ministry. The company also bought two T2 tanker
s that had been built in the USA. The company further renewed its fleet with 16 new ships between 1950 and 1960, and maximum tonnages steadily rose towards the end of the decade. The Royal Dutch Shell parent group absorbed Eagle Oil and Shipping in 1959.
History
Sir Weetman PearsonWeetman Pearson, 1st Viscount Cowdray
Weetman Dickinson Pearson, 1st Viscount Cowdray GCVO, PC , known as Sir Weetman Pearson, Bt, between 1894 and 1910 and as The Lord Cowdray between 1910 and 1917, was a British engineer, oil industrialist, benefactor and Liberal politician...
, Bart.
Baronet
A baronet or the rare female equivalent, a baronetess , is the holder of a hereditary baronetcy awarded by the British Crown...
(Viscount Cowdray
Viscount Cowdray
Viscount Cowdray, of Cowdray in the County of West Sussex, is a title in the Peerage of the United Kingdom. It was created in 1917 for the industrialist Weetman Pearson, 1st Baron Cowdray, head of the Pearson conglomerate...
from 1910) founded the company in 1909 to develop his investments in the Mexican oil fields.
Pearson's interests in Mexico had begun in 1889 when he won a contract from the government of Porfirio Díaz
Porfirio Díaz
José de la Cruz Porfirio Díaz Mori was a Mexican-American War volunteer and French intervention hero, an accomplished general and the President of Mexico continuously from 1876 to 1911, with the exception of a brief term in 1876 when he left Juan N...
for his civil engineering company, S. Pearson and Sons Ltd, to build the Gran Canal in Mexico City
Mexico City
Mexico City is the Federal District , capital of Mexico and seat of the federal powers of the Mexican Union. It is a federal entity within Mexico which is not part of any one of the 31 Mexican states but belongs to the federation as a whole...
. This was followed by contracts in 1895 to build a harbour at Veracruz and in 1896 to build the Tehuantepec Railway. Pearson diversified into mining, landholding, transport and electrical utilities around Veracruz. He and the engineer F.S. Pearson
Frederick Stark Pearson
Frederick Stark Pearson was an American electrical engineer and entrepreneur.-Biography:Dr. Frederick Stark Pearson was the son of Ambrose and Hannah Pearson. He graduated from Tufts University in 1883 with an A.M.B. and received an A.M.M. degree one year later...
(no relation) founded the Mexico Power and Light Company, which provided Mexico City's first public electricity supply. Pearson's businesses and government contracts put him in a favourable position with members of the Díaz dictatorship.
Oil production in Mexico was begun in 1901 by a US oil investor, Henry Clay Pierce. He was quickly followed by a rival, Edward L. Doheny
Edward L. Doheny
Edward Laurence Doheny was an American oil tycoon, who in 1892, along with business partner Charles A. Canfield, drilled the first successful oil well in the Los Angeles City Oil Field, setting off the petroleum boom in Southern California.At first he was an unsuccessful prospector in the state of...
, in the same year. Pearson's land surveys in the vicinities of Pedregal and San Cristóbal for the route of the of the Tehuantepec Railway had reported oil seepage from the ground, so in April 1901 he ordered his manager in Mexico to secure prospecting options on "...all land for miles around". Pearson built a refinery, pipelines and port facilities to handle the oil in 1905–06, but his company didn't make a major oil strike until 1908. In the same year one of Pearson's oil strikes caught fire and burned out of control for eight weeks, destroying the entire oil field
Oil field
An oil field is a region with an abundance of oil wells extracting petroleum from below ground. Because the oil reservoirs typically extend over a large area, possibly several hundred kilometres across, full exploitation entails multiple wells scattered across the area...
.
In 1909 Pearson founded the Compañía Mexicana de Petróleo El Aguila SA ("Mexican Eagle Oil Company") in Mexico to take over S. Pearson and Sons' oil interests. This followed Pearson's creation of Whitehall Securities Corporation Ltd. in the UK in 1908 to manage all of S. Pearson and Sons' investments outside the oil industry. Pearson's prospecting continued without success until 27 December 1910, when a well on the Gulf of Mexico
Gulf of Mexico
The Gulf of Mexico is a partially landlocked ocean basin largely surrounded by the North American continent and the island of Cuba. It is bounded on the northeast, north and northwest by the Gulf Coast of the United States, on the southwest and south by Mexico, and on the southeast by Cuba. In...
coast between Veracruz and Tampico struck oil that flowed at a rate of 100,000 barrels per day. This single well turned the fortunes of Pearson's oil business. Within a few years he was one of Mexico's two major oil magnates, the other being Doheny. Other oil companies from the USA and Europe had entered the Mexican oil industry but Doheny and Pearson's companies remained pre-eminent until after the First World War
World War I
World War I , which was predominantly called the World War or the Great War from its occurrence until 1939, and the First World War or World War I thereafter, was a major war centred in Europe that began on 28 July 1914 and lasted until 11 November 1918...
.
In 1911 the Mexican revolution
Mexican Revolution
The Mexican Revolution was a major armed struggle that started in 1910, with an uprising led by Francisco I. Madero against longtime autocrat Porfirio Díaz. The Revolution was characterized by several socialist, liberal, anarchist, populist, and agrarianist movements. Over time the Revolution...
overthrew the Díaz dictatorship that had favoured Pearson, ending the civil engineering contracts for which he had first become involved in Mexico. However, Pearson had exclusive rights to prospect for oil in several Mexican states and by 1914 the company 1500000 acres (6,070.3 km²) of prospecting rights, 175 miles (281.6 km) of pipeline, two refineries (the second being newly built at Tampico) and storage for seven million barrels of oil.
By June 1913 Mexican Eagle was the largest company in the Pearson group, with net assets valued at £6.8 million. However, in December 1918 Pearson claimed in a letter to the UK Chancellor of the Exchequer
Chancellor of the Exchequer
The Chancellor of the Exchequer is the title held by the British Cabinet minister who is responsible for all economic and financial matters. Often simply called the Chancellor, the office-holder controls HM Treasury and plays a role akin to the posts of Minister of Finance or Secretary of the...
, David Lloyd George
David Lloyd George
David Lloyd George, 1st Earl Lloyd-George of Dwyfor OM, PC was a British Liberal politician and statesman...
, that Mexican Eagle was worth £8 million. Mexican Eagle was the largest contributor to the Pearson group's valuation in 1913 of £17 million, which made it the seventh largest business in the UK and among the 30 largest businesses in the World. By 1919 the Pearson group was worth £29.6 million, of which in June of that year Mexican Eagle made up £13.4 million. To what extent this represents a growth in value must be considered against the degree of inflation that took place in the First World War. However, in 1919 the Pearson group's share value was £79.1 million, of which Mexican Eagle made up £62.6 million. This made Mexican Eagle roughly the equal of Burmah Oil and far bigger than the Anglo-Persian Oil Company
Anglo-Persian Oil Company
The Anglo-Persian Oil Company was founded in 1908 following the discovery of a large oil field in Masjed Soleiman, Iran. It was the first company to extract petroleum from the Middle East...
or Shell Transport and Trading.
Buyout offers and eventual sale
In 1911 Pearson declined an offer from the Texas Oil CompanyTexaco
Texaco is the name of an American oil retail brand. Its flagship product is its fuel "Texaco with Techron". It also owns the Havoline motor oil brand....
offered to buy his oil interests. In 1912 and 1913 he declined buyout bids from Royal Dutch Shell
Royal Dutch Shell
Royal Dutch Shell plc , commonly known as Shell, is a global oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the fifth-largest company in the world according to a composite measure by Forbes magazine and one of the six...
. and in 1913 and 1916 he declined bids from Standard Oil of New Jersey
Esso
Esso is an international trade name for ExxonMobil and its related companies. Pronounced , it is derived from the initials of the pre-1911 Standard Oil, and as such became the focus of much litigation and regulatory restriction in the United States. In 1972, it was largely replaced in the U.S. by...
. By 1916 Pearson was keen to sell, but the UK Government persuaded him for strategic reasons not to do so. Pearson asked the UK Government to buy 50% of his oil interests, but it responded in 1917 by imposing restrictions that prevented him from transferring ownership as long as the war continued. The Constitution of Mexico
Constitution of Mexico
The Political Constitution of the United Mexican States is the current constitution of Mexico. It was drafted in Santiago de Querétaro, in the State of Querétaro, by a constitutional convention, during the Mexican Revolution. It was approved by the Constitutional Congress on February 5, 1917...
adopted in 1917 nationalised oil deposits.
In October 1918, a month before the Armistice, Calouste Gulbenkian
Calouste Gulbenkian
Calouste Sarkis Gulbenkian was an Armenian businessman and philanthropist. He played a major role in making the petroleum reserves of the Middle East available to Western development...
started negotiations with Pearson for Royal Dutch Shell to buy Mexican Eagle. On April 2, 1919 the Royal Dutch Petroleum Company and the "Shell" Transport and Trading Company jointly bought Mexican Eagle for US$
United States dollar
The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....
75 million.
Mexican Eagle was the dominant firm in the Mexican petroleum industry until March 18, 1938, when the government of Lázaro Cárdenas
Lázaro Cárdenas
Lázaro Cárdenas del Río was President of Mexico from 1934 to 1940.-Early life:Lázaro Cárdenas was born on May 21, 1895 in a lower-middle class family in the village of Jiquilpan, Michoacán. He supported his family from age 16 after the death of his father...
nationalized it, changing its name to Petróleos Mexicanos (Pemex).
Petróleos Mexicanos formally dissolved itself on May 24, 1963.
Eagle Oil and Shipping Company
Pearson started to acquire steam tankers to carry the oil that he hoped to produce. Armstrong WhitworthArmstrong Whitworth
Sir W G Armstrong Whitworth & Co Ltd was a major British manufacturing company of the early years of the 20th century. Headquartered in Elswick, Newcastle upon Tyne, Armstrong Whitworth engaged in the construction of armaments, ships, locomotives, automobiles, and aircraft.-History:In 1847,...
on the River Tyne
River Tyne
The River Tyne is a river in North East England in Great Britain. It is formed by the confluence of two rivers: the North Tyne and the South Tyne. These two rivers converge at Warden Rock near Hexham in Northumberland at a place dubbed 'The Meeting of the Waters'.The North Tyne rises on the...
launched SS San Cristobal (2,041 tons) in 1906 and Swan Hunter
Swan Hunter
Swan Hunter, formerly known as "Swan Hunter & Wigham Richardson", was one of the best known shipbuilding companies in the world. Based in Wallsend, Tyne and Wear, the company was responsible for some of the greatest ships of the early 20th century — most famously, the RMS Mauretania which...
, also on Tyneside, launched SS San Antonio (5,251 tons) in 1909. Pearson also bought SS James Brand (3,907 tons), which had been built by Armstrong Whitworth in 1893, and renamed her San Bernardo.
In 1912 Pearson founded the Eagle Oil Transport Company
Eagle Oil and Shipping Company
Eagle Oil and Shipping Company was a United Kingdom merchant shipping company that operated oil tankers between the Gulf of Mexico and the UK. Weetman Pearson, 1st Viscount Cowdray founded it as the Eagle Oil Transport Company in 1912 and sold it to Royal Dutch Shell in 1919...
in the UK to take over his ships and carry Mexican Eagle's products and the Anglo-Mexican Petroleum Company in the UK to sell Mexican Eagle's products outside Mexico.
Eagle Oil Transport immediately ordered 20 modern steam tankers at a cost of £
Pound sterling
The pound sterling , commonly called the pound, is the official currency of the United Kingdom, its Crown Dependencies and the British Overseas Territories of South Georgia and the South Sandwich Islands, British Antarctic Territory and Tristan da Cunha. It is subdivided into 100 pence...
3 million. Eagle Oil Transport lost a number of ships to enemy action in the First World War. After the First World War, Eagle Oil Transport renewed and expanded its fleet. It bought numerous new tankers, including six of about 13,000 tons each. When Royal Dutch Shell bought Pearson's oil interests, that included Eagle Oil Transport and Anglo-Saxon Petroleum as well as Mexical Eagle Petroleum.
In about 1930 the Eagle Oil Transport Company was renamed the Eagle Oil and Shipping Company
Eagle Oil and Shipping Company
Eagle Oil and Shipping Company was a United Kingdom merchant shipping company that operated oil tankers between the Gulf of Mexico and the UK. Weetman Pearson, 1st Viscount Cowdray founded it as the Eagle Oil Transport Company in 1912 and sold it to Royal Dutch Shell in 1919...
. In about 1935 the company started adding a new generation of motor tankers of about 8,000 tons each.
Eagle Oil and Shipping was registered in the United Kingdom. Therefore after 1938 although the Mexican government had nationalised Mexican Eagle Petroleum, Eagle Oil and Shipping remained a subsidiary of Royal Dutch Shell. After 1938 the fleet continued to carry oil from the Gulf of Mexico
Gulf of Mexico
The Gulf of Mexico is a partially landlocked ocean basin largely surrounded by the North American continent and the island of Cuba. It is bounded on the northeast, north and northwest by the Gulf Coast of the United States, on the southwest and south by Mexico, and on the southeast by Cuba. In...
to the UK. During the Second World War
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
the company played an important role in supplying petroleum and petroleum products to the United Kingdom. Oil tankers were a particular target in Germany's economic warfare against the UK. Enemy action sank 17 Eagle Oil's ships and killed at least 206 officers, men and DEMS gunners serving aboard them.
Among the ships lost was (8,073 tons), which was famous for surviving a naval bombardment by the German heavy cruiser
Heavy cruiser
The heavy cruiser was a type of cruiser, a naval warship designed for long range, high speed and an armament of naval guns roughly 203mm calibre . The heavy cruiser can be seen as a lineage of ship design from 1915 until 1945, although the term 'heavy cruiser' only came into formal use in 1930...
Admiral Scheer in 1940 that set the tanker on fire. San Demetrio was repaired and returned to service, but the U-boat
U-boat
U-boat is the anglicized version of the German word U-Boot , itself an abbreviation of Unterseeboot , and refers to military submarines operated by Germany, particularly in World War I and World War II...
U-404 torpedoed and sank her in the western Atlantic off Virginia
Virginia
The Commonwealth of Virginia , is a U.S. state on the Atlantic Coast of the Southern United States. Virginia is nicknamed the "Old Dominion" and sometimes the "Mother of Presidents" after the eight U.S. presidents born there...
in 1942 with the loss of 19 lives.
In 1942 the Ministry of War Transport placed a number of Empire ships under Eagle Oil and Shipping's management. One was sunk by enemy action in 1943 but after the war the company bought two of the surviving ships from the ministry. The company also bought two T2 tanker
T2 tanker
The T2 tanker, or T2, was an oil tanker constructed and produced in large quantities in the United States during World War II. The largest "navy oilers" after the T3s at the time, nearly 500 of them were built between 1940 and the end of 1945....
s that had been built in the USA. The company further renewed its fleet with 16 new ships between 1950 and 1960, and maximum tonnages steadily rose towards the end of the decade. The Royal Dutch Shell parent group absorbed Eagle Oil and Shipping in 1959.