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Alberta Online Encyclopedia

Feature Article

RED DEER'S PIONEER OIL BOOM

Written By: Michael Dawe
Published By: Red Deer Express
Article Used with permission. © Copyright Michael Dawe, 2006
2006-01-29

While most people view the discovery of oil at Leduc in 1947 as the start of Alberta’s great oil and gas boom, in fact there was a much earlier "black gold" rush in Alberta. On May 14, 1914, the A.W. Dingman well at Turner Valley blew in with a flow of four million cubic feet of wet gas a day. It was the discovery of the largest oil and gas field in the British Empire.

The exciting news of the strike could not have come at a better time. The spectacular pioneer real estate boom in Alberta had come to a crashing halt in the summer of 1913. People, who had counted themselves millionaires a short while before, now had trouble paying their bills. Word of the Turner Valley oil and gas discovery created prospects of economic salvation.

Although Red Deer was more than 200 kilometres north of the strike, a wave of "oil fever" swept the community. People made the logical supposition that if there was all that oil and gas at Turner Valley, there was probably plenty in Central Alberta as well.

People flooded into local land titles office in order to buy up oil and gas leases. Those rights could be purchased from the Federal Government for 25" an acre plus a $15 filing fee. In ten days, $45,000 worth of leases were snapped up at the Red Deer office. On May 26th alone, $14,000 in fees were paid.

A community that had appeared cash-starved only a fortnight before was now spending money at an astonishing rate. The long-suffering real estate agents became stockbrokers and promoters literally overnight. New offices quickly opened along the two main thoroughfares, Ross Street and Gaetz Avenue.

City Council saw a golden opportunity for new revenues. It levied a new license fee of $25 for local brokers and $50 for non-residents. Although there were predictable screams of outrage from the local real estate agents and stock promoters, money soon poured into the City’s coffers.

Most of the first shares being peddled were from Calgary and Southern Alberta companies with names such as Pacific Oil and Refining, Prudential Oil and Gas and Sunbeam Oils. However by the end of May 1914, local oil companies were being formed. The first were Red Deer Oil and Gas, Central Alberta Oils and Innisfail Pioneer Oil.

In early June, one of the local companies brought in a geologist who announced that oil and gas could be found at Red Deer at relatively shallow depths. Share prices in the local oil companies surged. Some tripled in a week. The 25" leases began to sell for $10 each.

On June 18th, the frenzy of activity peaked with word of the successful Monarch well, 120 kilometres southwest of Red Deer. More people stampeded to the Land Office. One barber left a customer sitting in his chair. The C.P.R. ran into difficulties when its construction crews took sudden "leaves of absence" to join the lineup for leases. A local newspaper editor bet an alderman a box of expensive cigars that the line-up would never exceed five hundred. He lost.

There were inevitable allegations that the land titles staff had been offered bribes by Calgary operators to ignore the priority system for filing. In the subsequent swirl of controversy, four clerks tendered their resignations.

By mid-July, the boom began to lose steam. People began warning that many companies were more interested in selling shares than actually drilling for oil. Consequently, the price of shares in some of the more questionable companies began to plunge downwards from dollars apiece to just a few cents. At the end of July, the Red Deer Oil and Gas Company announced that it was suspending operations for a few months to await "financial and oil developments."

In August, the Pioneer Oil Company actually began drilling 10 kilometres south of Red Deer. Another well was started by the Red Deer Investment Company shortly thereafter. Both these wells failed to produce any oil or gas.

Meanwhile, the outbreak of the First World War in August 1914 turned people’s attention elsewhere. Oil talk vanished from the streets. Even the announcement by the Federal Government that all leases were extended to March 1, 1916 because of the War, failed to revive any interest. The pioneer oil boom was now just a memory. A great many years would pass before another one began.

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