Methods of Valuing Oil Lands (025da0c1-2e4f-4ba5-a7e8-ef9db6a71cab)

F. G. CLAPP, New York, N. Y. (written discussion *).-Whatever processes of appraisal have been found most correct and feasible in one field or group of fields will generally prove most adaptable in others. So far as the California fields are concerned, Mr. Requa's paper appears to outline the most up-to-date processes of appraisal. It remains, then, to discuss and adapt these and to make such revisions in methods and processes of calculation as will give us results elsewhere. The trouble about most attempts to place a value on oil lands, whether in this country or elsewhere, has been that many of the so-called "experts" called upon to express an opinion either have not possessed the requisite engineering and geological knowledge to make an accurate appraisal of the lands, or that they were not furnished with sufficient information for the purpose in hand. The Independent. 011. Producers' Agency of California, for whom Mr. Requa's original report was prepared, had many advantages in this respect not generally available to engineers making reports, as all existing information seems to have been at the experts' disposal within the limits of a large number of properties, practically commensurate with the extent of the fields in question. Hence the report could be and was more accurate than any similar report for a single company is likely to be in other fields. Very few companies are so exempt from competition that all the data on neighboring leases of other companies will be freely turned over to them. In many companies, certain available data are concealed from the engineer who makes the reports, particularly if the properties are supposed to be worth less than their apparent value. In the case of other companies, having the best of intentions, the data are insufficient to help the engineer greatly in his appraisal, simply because the oil business has been so, unsystematic in most fields that only the largest and wisest companies have kept accurate figures regarding runs and gravity of oil from individual wells and from different depths. In many wells, which ran wild for clays or weeks in the older fields, there was a waste which is not recordable with exactness. These and many other difficulties confront even the most experienced expert in actual practice outside of the California fields. We may justly say, therefore, that an engineer in other fields of the United States and in the European, South American and Asiatic fields, must not only begin where the Independent Oil Producers' Agency