'Sacrificed on the Altar of Oil': Los Angeles' Uneasy Relationship with Petroleum

By Nancy Quam-Wickham

The Forgotten and Amazing History of Oil Production in Los Angeles

Panoramic view of a residential neighborhood in Long Beach, facing north and east, with the Signal Hill oil field in the background. The neighborhood consists of hundreds of single family homes and small apartment buildings. The streets seem to be unpaved, and there are only a few automobiles parked on the street on the right. The entire horizon is lined with the oil derricks of Signal Hill. 

Porcupine Hill, 1922. Early Los Angeles City Views (1925+). Water and Power Associates. Web. 3 Jan. 2015. 


I want to start these comments with a personal observation:  like most of us here, I live in the Los Angeles area, a region that owes its economic, social, and cultural prominence, and its relatively high standard of living, in large part – historically speaking - to the benefits of cheap oil.  And it is a region that has suffered immensely – in environmental, social, and economic terms – from that same historical reliance on cheap oil.

An anecdote follows this observation: A few months ago, I was on my way to west Los Angeles from my home in Long Beach, creeping along the #405 in the carpool lane, when I passed another motorist nearly stopped in the number one lane of the six lanes of northbound traffic.  It was, after all, the (quite extended) morning rush hour.  This particular motorist was driving a brand new Toyota Prius, sipping her morning coffee (undoubtedly a cappuccino), and patiently it seemed waiting for the ordinary traffic to speed up.  On the rear bumper of her Prius was a vanity license plate with the letters: K-M-A-O-P-E-C.  I suppose the motorist meant for her license plate to be some kind of profound assertion of freedom from oil, but the exquisite irony did not escape me: here she was, sitting stuck in traffic (albeit in a hybrid auto), in what appeared to be her normal commute, proclaiming some illusory independence from oil with the political message: “Kiss My Ass OPEC” bolted to the rear bumper of her car.

I’m telling you this story because I think it is emblematic of Americans’ attitudes toward oil. We are, as a nation, hopelessly dependent upon petroleum.  And nowhere is this tension between dependency and our desire for freedom from oil (including its environmental effects) and our unwillingness to confront oil’s presence more sharply hewn than here in Los Angeles.

Part of the reason for this tension exists because beginning in the late 19th century, and quickening pace in the first three decades of the 20th, oil production here occurred in an urbanizing region.  By 1925, no other major oil-producing region in the world was so similarly urban as was the case in southern California.  Oil production propelled Los Angeles into full participation in a global economy – in the 1920s, nearly 30% of the world’s oil was produced here; the port of Los Angeles expanded exponentially to handle oil exports (primarily to the eastern U.S. and to Asia – in fact, the Imperial Japanese military owed its capacities to cheap California oil until exports were suspended in late 1940).   The Slauson steel corridor was almost entirely devoted to production of oil field and refinery machinery; and labor demands in fields, refineries, and corporate offices enticed thousands of ambitious men and women to migrate here. At the same time, the urban setting brought to the public’s view some of oil’s most unsettling characteristics.  I want to provide a swift introduction to oil development here in southern California, illustrating the ways in which oil dominated development (social, political, environmental) in this urban space by examining briefly a number of themes.

The first theme is overproduction (perhaps better characterized as wanton waste).   I start not with the familiar story of Doheny and Canfield’s Los Angeles City oil field of the 1890s, because while Doheny’s field was notable, it was dwarfed by the center of California oil production in the rural San Joaquin Valley. California had long been a major oil producing state. The Los Angeles basin became the center of California (and for a time, world) oil production beginning in the years after World War I, with the discovery of one new field after another: Montebello in 1917, Richfield in 1919, Newport Beach and Huntington Beach in 1920, Long Beach (Signal Hill) in 1921, Santa Fe Springs and Torrance in 1922, Dominguez in 1923, Inglewood in 1924, Seal Beach in 1926, and the granddaddy of them all, Wilmington in the 1930s.   In the summer of 1923, the region’s three most important fields – Huntington Beach, Long Beach, and Santa Fe Springs – accounted for nearly 80% of the state’s record-setting production of 872,000 barrels per day. Overproduction caused oil prices to collapse, leading one observer to write that the industry “was being choked, and strangled, and gagged, by the very thing most wanted – oil!”

Overproduction of oil was a nearly universal consequence of the discovery of large oil fields in the first half of the twentieth century, both in Los Angeles and elsewhere.  Here, industry officials seldom admitted that overproduction was anything more than a “market problem.”  In the flawed logic of capitalism, though, such a market problem has an easy resolution: When prices drop, produce more. And this is exactly what corporations did – they spudded in new wells, sometimes several new wells per week, and tried to extract oil before their competitors got it. This frenzied pace of development – and the attendant “market problems” that were ultimately exacerbated by it – so alarmed federal officials fearful of widespread economic collapse that beginning in the late 1910s, the Federal government attempted to stem overproduction in L.A. by instituting unit operation (essentially dividing up a field’s resources equitably among development companies); unitization (or rational production regulation), as it is called, is still key to federal (and state) regulatory efforts within the industry.

Los Angeles was the birthplace of this regulatory invention. It was surely not easy for bureaucrats – called “oil umpires” to ensure cooperation between oil producers by convincing competitors to delay potential profits in service of the greater good.   However, the umpires often despaired that just when they were on the verge of reaching an agreement on limiting production, a renegade oil outfit would violate a proposed agreement, and throw the entire effort into the wind.  One oil umpire, in fact, wrote despairingly of his duties, wanted to “shoot himself” on several occasions, and finally, suffered a near fatal heart attack during a particularly difficult period of negotiations in the mid-1930s -- all in response to the actions of none other than the young Angeleno Ed Pauley, who sold his oil on the “black market” for 20c per barrel when competitors had agreed with the feds to hold out for 50c per barrel.

Another theme is environmental degradation and this is intimately tied to overproduction.  Before the 1970s, the federal government’s efforts to tame the industry were primarily restricted to preventing catastrophic price collapse.  Addressing environmental degradation was a state and local undertaking.  In the 1920s, the ecological consequences of unrestrained oil production were mind-boggling.  Wells exploded in fireballs; hastily constructed pipelines burst, sending “rivers of oil” down to the sea; drilling rigs contaminated groundwater supplies; companies routinely used natural sinks – such as the duck pond in Huntington Beach’s Central Park – as waste oil sumps, and children and animals occasionally drowned in them; natural gas was an undesirable byproduct of crude production, so gas was simply allowed to surge into the air; at one point, the harbor was reportedly covered in 4-6” of crude.  Local city councils reacted by attempting to limit well drilling, or to ban operations altogether. Some communities incorporated in order to be able to pass laws to regulate industry operations.

The story of the Wilmington Field best illustrates the ways in which unrestrained oil development led to environmental catastrophe – and it also speaks to the lengths to which oil companies would go to protect their own interests.  Although first discovered in 1932, the discovery company – Ranger Petroleum – mistakenly believed that their well was simply tapping into an extension of the Torrance Field. Enter immigrant longshoreman ChuChu Salcido, who one fateful afternoon in April 1935, discovered oil – or more properly, light-end products known as casinghead gas overlying the dome of a fantastically rich oil field -- while digging a cesspool on his homestead in Wilmington. Within weeks, Salcido’s find captured the public imagination.  What ensued was probably the strangest example of oil field development in the history of the United States.  The field was developed solely by “backyard operators” who dug wells by “hand” using shovels and spades, and casing their wells with the shells of salvaged water heaters in order to prevent the sandy soils from caving in.  They pumped their wells by hand, with old water pumps, at low tide.

This makeshift oil field did not last long though, as it was clear that Wilmington was a very rich field. Within months, “prominent oil men” had convinced the city to ban the “backyard operators” because of the environmental risks such developers posed.  Ironic, to say the least.  By 1958, the Wilmington Oil Field was the second most productive field in the nation, second only to the famous East Texas Field.  It has produced over 2.5 billion barrels of oil, and is still producing today.  Once the “majors” began production in Wilmington, the accompanying environmental problems – pollution, fires, release of toxic gasses – occurred.  But more importantly, the geological substructure was such that as oil was removed from the ground, the surface lands sunk – a phenomenon known as subsidence.  By the late 1940s, so much oil had been taken out of the ground that Wilmington became known as that “Sinking City” – where subsidence was as great as 42 feet, fracturing waterlines, roadways, and railroad tracks, and requiring the city to rebuild the Harbor water treatment plant twice before it even commenced operations.  (And subsidence deepened the channel south of Long Beach city center, making it possible for the Queen Mary to be docked in that city.)  Subsidence – and its resolution, injecting water into pools as oil is pumped out – have resulted in other problems as well, as subsidence has been implicated as a primary cause of the disastrous 1963 Baldwin Hills dam break.

The final theme is the deliberate erasure of oil’s impact on Los Angeles, or what we might call the sanitization of the industry’s image.  Contemporary observers often wrote of LA’s early twentieth century fields as comprising “forests of derricks,” a very common but strange allusion to “nature.” Postcards of the time depict derricks on the beach, where the sands are clean, the water is clean, the air is clean – all in stark contrast to contemporary accounts of the fields. Richfield built its famous black (crude) and gold art deco headquarters building in downtown LA, in an ostentatious display of wealth: slick but clean, gaudy but dazzling at the same time. In the 1930s, corporate marketing geniuses created a narrative of dinosaurs and their alleged relationship to oil – that crude was the natural byproduct of decaying organic material, as if Sinclair’s Brontosaurus had somehow willingly sacrificed his life for ours – surely a perversion of the ultimate sacrifice. We hide our rigs behind highly decorated facades. And even today, we memorialize some of LA’s most egregious and successful overproducers – with, for instance, the Doheny Library, the Getty Museum and Pauley Pavilion. We might even drive there in our hybrids.