(upbeat music) - [Announcer] Springhill Senior Living in Erie, Pennsylvania, offering a wide range of maintenance-free apartments with balconies and patios, and garden homes designed to provide an active and engaging lifestyle, where residents can spend more time focusing on what they want to do, not what they have to do.

Springhill also includes a continuum of quality healthcare services for added peace of mind.

Learn more at springhillerie.org.

An equal opportunity housing provider.

- [Announcer 1] "Chronicles" was made possible thanks to a community assets grant provided by the Erie County Gaming Revenue Authority, Springhill Senior Living, support by the Department of Education, and the generous support of Thomas B. Hagen.

- [Announcer 2] This is WQLN.

(intense upbeat music) - [Lee] Well, the most obvious application of oil is for fuel and the common fuels are gasoline and diesel, of course, but it's also used in plastic manufacturing and then, there's other applications for cosmetics and lubricants and what we forget sometimes is how much plastic is in our building materials.

So, that's extremely important.

(intense music slows) (slow music) - From ancient times, humans around the planet have used oil for waterproofing, a base for paint.

Thicker asphalt base was used for paving roads in ancient times.

- [Victor] Let me take you on a journey.

I am one of the many thousands looking to make their riches in America's black gold.

It's the mid 1860s and we're in Venango County, Pennsylvania.

We know the oil is here.

The Native Americans have been using it for centuries.

- [Susan] Native Americans dug pits and as the oil rose to the surface of the water, they would lay down blankets and then, ring the blankets out into containers.

- [Victor] And we have the tools.

We're borrowing that from the fellers that have been pumping salt brine.

- Salt well drillers were first, trying to harvest salt for food preservation.

We can't have bacon without salt.

Can't have pickles without salt.

The salt well technology was using parts of different technologies developed in China 3,000 years ago.

The idea of using a drill bit to pound a hole in the ground.

Now, to keep those tools straight in the ground, they built these structures called derricks, which you can see behind me.

- [Victor] But there's a greenish scum being found on top of salt brine.

Sometimes it comes out black.

- And when they would reach the brine, sometimes they also reach petroleum.

So, the crude oil was being produced by salt well drillers who, for the most part, saw it as a byproduct that was ruining their salt wells.

Who wants black salt?

(chuckles) - [Victor] But the boys down at the lab found this green stuff to be highly flammable.

That proves to be exciting for some.

- Humans around the planet have always disliked darkness.

There is a desperate need for a cheap lamp fuel to provide that artificial light for day-to-day, evening lifetime activities.

Whale oil was becoming increasingly expensive.

Burning fluids, which often were a mixture of pine tar and alcohol, were extremely explosive.

So, they were developing a lamp fuel from coal called coal oil.

Salt well producers realized that this hydrocarbon that they were finding with their salt could be turned into lamp fuel.

- [Victor] But this wasn't new information to everyone.

- For centuries, Native Americans had been digging for oil all along Oil Creek and the Allegheny River Valley including French Creek and some of the other tributaries to the Allegheny.

- [Victor] And so, the first bit of money comes sniffing around.

- Beginning in 1853, a group of financiers, investors from New York City formed the Pennsylvania Rock Oil Company and through various corporate takeovers, that becomes the Seneca Rock Oil Company.

The lumber mill owners, Brewer and Watson, that owned this land, had become acquainted with these Connecticut and New York City financiers and so, worked out a deal to lease their property to mine, bore, dig, et cetera for oil.

- [Victor] Enter Edwin Drake, a former train conductor who still got some perks of the trade.

He meets these financers in a Titusville hotel they all happen to be staying at.

He proved to be a useful asset in their search for oil and they hire him to start drilling.

- So, Edwin Drake was brought here, because he had a free railroad pass, paid $1,000 a year salary, and he decided to drill in one of those Native American pits, hoping to find the source of the oil that rose to the surface of the water.

- [Victor] A decision that happens to benefit the small city of Erie, Pennsylvania.

- With salt well technology, you need a steam engine and a steam boiler to provide the power to drill that hole in the ground.

So, when you see these photographs that show hundreds of derricks, each one of those has an engine and a boiler and an operator to make sure that boiler doesn't explode.

Drake buys his engine from Liddell, Marsh, and Hershey in Erie.

Within a few years, that becomes the Erie City Iron Works.

The Erie City Iron Works becomes one of the major players on West 12th Street in the city of Erie, eventually manufacturing railroad cars, as well as marine engines used by the U.S. Navy and other larger shipping companies.

Erie had all the markings for a thriving community before the oil industry was developed, but with the oil industry, it then had refineries.

Its existing steam engine manufacturings quadrupled.

You then had several steam engine manufacturers selling their engines and their equipment and tools to the oil field.

So, Erie blossoms with steam engine manufacturers.

A lot easier to get the equipment from Erie than Buffalo, Cleveland, or Pittsburgh.

- [Victor] So, Drake gets to drilling, but it's slow progress, three feet per day and frequent setbacks.

His financial backers cut off the funding at $2,500.

- Not the Connecticut financiers, but Drake ended up borrowing money from some Titusville businessmen to keep going with his drilling effort and to continue to feed his family.

- [Victor] Drake borrowed $500 to continue his operation.

That's a value of roughly $18,000 in 2023.

The problem was that water seepage made the ground collapse into the drill shaft forcing the drillers to have to start over.

Drake's solution changed the course of history.

He drove a cast iron pipe into the shaft, stopping the well from collapsing as they drilled deeper and so, deeper they went until at 69 feet down, they struck oil.

(intense string music) (intense string music fades continues) - No one knew how much oil was really down in the ground.

At 69 1/2 feet, all of a sudden, Drake was pulling up 25 barrels a day, just an unheard of quantity of oil.

He didn't have enough containers.

He even used the local wash tubs to try to find something to hold all this magic liquid that was being produced.

Edwin Drake was incredibly lucky.

If he had drilled 50 feet in either direction, he might not have hit what's we call the Drake stray sand.

It was a very shallow layer of sandstone, very narrow in width that produced the oil which he tapped into.

- [Victor] But he did tap into it and boy, did that news travel fast.

- As soon as Drake struck oil, the story goes that Jonathan Watson jumped on his horse, raced down the Oil Creek Valley to secure as many leases on farms as he could.

He and his partner Brewer subleased lots to other drillers and people came from all over the country forming their own oil companies or just drilling on their own.

By the end of 1859, there were four producing wells in the Oil Creek Valley.

By the end of 1860, there were hundreds of wells over on French Creek by Franklin and then, up the Allegheny to Tidioute, where in December, the first gushers were struck, the first oil exported to Europe.

1862, the first exports to Japan.

First refineries are built in the area near the oil wells.

1863, we've got Lincoln appointing a consult to Belgium to encourage exports.

- [Victor] More and more people recognize the money that can be made from finding a good flowing well.

(inspiring music) - Everyone was after that part of the crude that could become kerosene.

One of the first things that everyone realized was that this was a cheap, safe lamp fuel.

No longer did the crews have to sail away out of the eastern seaboard, go all the way around the the tip of South America to find whales in the Pacific, kill them, cut them up, boil them down on deck to bring back whale oil and bone for fertilizer.

We could now get a cheap lamp fuel right here from Pennsylvania.

(slow music) Obviously, there's very few chemists working in this specific area in 1859, 1860.

They knew that by heating the crude, different things vaporized at different temperatures and when it got to be a certain color, that's what they knew of as kerosene.

They eventually, late 1800s, could name all the different fractions that came off, but initially, they didn't.

They were after the kerosene.

So, anything after that was thrown away, dumped into the creek.

The high end, they soon realized, could be used to pour back down the well to melt the paraffin that was gathering on the inside of the pipes.

There was one refinery in Pittsburgh and that was Samuel Kier's, but it didn't take long for others to jump in.

All over the East Coast, there were coal oil manufacturers making lamp fuel from coal and it was an easy switch over to petroleum from coal.

So, some of these coal oil refiners end up moving into Pittsburgh, Cleveland, and this area.

(inspiring music) By 1862, there were two scientifically advanced refineries in the region, one around which the city of Corry grows and another one in a small town called Plumer.

German chemists.

These chemists were able to develop new products for use on the market.

Any oil man that tries to use soap to wash their hands will tell you that it becomes thicker and you get this substance we call grease, which can be used to lubricate machinery.

The petroleum industry lubricated the Industrial Revolution and these chemists found out that some of this, what was left over after pulling off all these other products, could be used to find new dyes, new colors, which could then be added to clothing.

New dyes had been developed using the coal tar, the residue of coal oil manufacturing.

So, now, chemists were applying that same knowledge to what was left over from making kerosene.

(inspiring music continues) By 1862, President Lincoln and Congress realized that the North now had a new product that was out outrageously valuable.

The oil men in West Virginia, when Virginia seceded as part of the South, didn't want to join the Confederacy.

They wanted to stay with the Union near the Pittsburgh refineries.

So, the state of West Virginia is born, 1863.

They then realize, being politicians, we could tax the exports and they did so at $1 a barrel.

Now, if you've got wells producing 3,000 barrels a day, multiply that by the hundreds of wells in this region and you've got funding for the Northern armies.

- [Victor] Now, the Lumberman had been concerned by slowing demand, but this new industry provides a remarkable new opportunity.

- Coopers are the ones that make wooden vessels.

So, wooden buckets, wooden barrels, wooden tanks.

Advances in technology often come from supplying the need.

Drake didn't have enough barrels to put his oil in, so we get coopers moving into the area, but a skilled cooper, it still takes a day to make one barrel and when you've got 1,000 barrel, 3,000-a-day wells, you need a lot of coopers.

So, then, machines are invented and developed to make barrels faster.

- [Victor] But a barrel of oil doesn't move itself.

- Transportation was the major obstacle for oil producers in the very early years of the industry.

(inspiring music continues) Pittsburgh's a long way away from here, but the waterways were navigated by the lumbermen who knew their way.

So, you could load the barrels onto rafts and then, float it down Oil Creek, down the Allegheny to Pittsburgh refiners.

(inspiring music continues) All the lumbermen up and down the Allegheny, as well as up and down Oil Creek, had mill ponds where you could drag the logs down the hillside and then, float them in the pond to then be brought up to the mill to be sawed.

These mill ponds could then be opened, creating a flood of water on Oil Creek, which would raise these lumber rafts, or later, the barges full of oil barrels, up and they could then float down to the Allegheny River or you could load six barrels roughly onto a wagon, take it over the muddy, muddy roads to the junction of two railroads in what becomes the city of Corry.

Even now, if you won't go on a dirt road in Northwestern Pennsylvania in the spring, they're muddy and they're full of potholes.

The same was true then, but now, you're multiplying it by hundreds of teamsters, wagons, each loaded with barrels of oil and all that weight and the horses hooves going up and down this road every day going to the nearest railroad or to the nearest refinery.

So, if you've got 1,000-barrel well, a wagon can fit six barrels.

Do the math.

That's a lot of wagons and horses up and down these roads, which become so muddy that then, it becomes a big joke.

1862, you've got the beginnings of the Titusville Oil Creek railroad from Corry down to Titusville and by 1866, all the way down the valley to Oil City.

- [Victor] Oil men like me were too busy trying to get rich to actually move any oil ourselves.

So, that fell into the hands of teamsters, a term that referred to anyone driving animals to pull a wagon.

- Teamsters were coming from all over.

First of all, you've got all the farmers that have horses and wagons, so they're the first teamsters, but soon, you've got wagon builders building new wagons.

Again, there's a need.

People are gonna fill that need.

So, you could buy a wagon or get a used one.

Any young man looking for a job could then be hired by a well operator to be a teamster or you've got people that own their own wagon and horses entering the business.

- [Victor] And the wells could be anywhere.

It's not like we knew what we were doing.

We were dropping wells wherever we could.

- There were no geologists that had ever really studied petroleum.

Geologists knew it existed, but people specialized in things like coal or fossils or rivers.

So, the science of petroleum geology grew as wells grew.

- [Victor] We learned as we went along and sometimes, that came at a painful price.

(gentle suspenseful music) - With the first flowing wells, the first gushing wells, again caused by gas pressure.

No one expected it.

No one knew what to do.

Oil was flying everywhere and no one realized that with the gas, you can have explosions.

1861, we've got the first major explosion with many men getting burned to death and dying.

(epic music) - [Victor] Despite the danger, the appetite is huge and more people are seeking more opportunities for more wells on more land.

(epic music slowing) - The United States Petroleum Company was formed in Plumer, which is near Pithole, by Mr. Frazier, Faulkner, and others and they're the ones that purchased part of the land, the land option, leased it from Thomas Holmden for oil well drilling.

(gentle music) (gentle music continues) - [Victor] And if you're wondering why they took an interest in this hilltop stretch of land... - 'Cause Thomas Holmden talked 'em into it.

(gentle inspiring music) - [Victor] Thomas was a smart man.

He made a fortune from this once valueless land.

He was a kind man, too.

He and Walt had a third brother, John, who died.

Thomas became guardian to John's kids and set them up with a modern equivalent of $0.5 million in bonds, just one of many kind acts in his life.

(inspiring music continues) - [Susan] The men that came to drill in Pithole formed their company in the summer of 1864.

They then started leasing.

They leased part of the farm, about 160 acres from Thomas and Walter Holmden, divided it up into lots, leased another lot to Kilgore and Kenan and so, two wells or three were begun in the summer of '64.

Both came in in January.

They then laid out a town.

Lots were leased By September.

You've got roughly 15,000 people living in the Greater Pithole area.

54 hotels and boarding houses in Pithole City alone with another 21 within a mile.

You've got nine drug stores, 18 physicians, cooperage houses, everything a community needs in order to live.

Cooks, chambermaids, entertainment houses, theaters, restaurants, machine shops, foundries, blacksmiths.

(inspiring music continues) (inspiring music fades out) Pithole is a phenomenon with its growth and activity.

You've got two streets worth of buildings being built in a couple of weeks and more continually happening.

One hotel was started in the morning and was occupied by 10 to 15 guys that night.

The rapid growth, it's amazing and then, you've got 15,000 people in the Greater Pithole area by September of 1865.

- [Victor] Now, many people might raise an eyebrow over the ability to build a town that fast, but we had our ways.

(inspiring music continues) - One of the construction methods developed, maybe for boom towns, was called balloon frame construction, where you build the wall on the ground and then, raise those walls into place.

That's what enabled Pithole to begin to grow so fastly, for buildings to be built so quickly.

In other words, they weren't well-made.

By 1865, real estate developers realized that instead of trying to engage in the risky business of oil production, you could gain a lot of money by buying and leasing land.

So, you've got a developer across Pithole Creek that develops Prather City, one up the creek that develops Balltown and another not as successful called Dawson Center.

- [Victor] You've never seen anything like it.

The building's going up, the hustle and bustle of everyone trying to get in on black gold.

It's an incredible site.

(gentle suspenseful music) - So, all the global output of oil came from this region with the first wells in the late 1860 and then, others in '61, producing 500 or 3,000 barrels of oil a day.

By the time Pithole gets going with the height of its oil production, 2/3 of the output of oil for this country came from Pithole.

- [Victor] And it's making some people very wealthy.

- Well, oil is referred to as black gold.

It goes back to property owners and leasing mineral rights to oil companies in the hope that oils developed on their property and they would get big fat royalties.

- [Victor] And when it came to the Holmden brothers, one of them did just that with astonishing success.

- So, you've got Thomas Holmden who reserved 1/4 of the oil in his lease to the United States Petroleum Company.

So, any of the oil produced on the lands the United States Petroleum Company, 1/4 of it goes to Thomas Holmden, who then moves to Cleveland, becomes a real estate developer, and ends up on the City Council of Cleveland.

- [Victor] Nice and easy for him, not so straightforward for the rest of us.

- So, you've got a farm that then is leased to a company, an oil company, that then subdivides that farm into lots, drilling lots, sometimes an acre, sometimes a half-acre, sometimes a quarter-acre.

So, then you've got operators coming in and buying leases for X number of dollars, for X number of lots.

Then, they have to buy the tools.

They have to buy the lumber to build the derrick.

They've gotta hire the experienced driller.

They've gotta dig down to bedrock, begin the drilling process, three feet a day for wells that are anywhere from 250 to 650 deep or deeper.

Then, you've gotta buy the barrels.

You've gotta produce the oil and find a buyer then to buy that oil.

(intense string music) When you've got all of that capital invested in an oil well, you're then at the mercy of the refiners.

How much are they going to pay you for that oil?

The refiners are at the mercy of the market.

What's the demand?

What's the federal government taxing per barrel of oil?

It's a dicey situation becoming an oil producer.

- [Victor] Oh, well, now she tells me.

(no audio) (intense string music) (intense music continues) (intense music fades out) - [Announcer 1] "Chronicles" was made possible thanks to a community assets grant provided by the Erie County Gaming Revenue Authority, Springhill Senior Living, support by the Department of Education, and the generous support of Thomas B. Hagen.

- [Announcer 2] This is WQLN.