How BP nearly never existed

Walter Russell Hall and William Knox D'Arcy (image sourced from Wikimedia Commons]

Walter Russell Hall and William Knox D’Arcy (image sourced from Wikimedia Commons]

BP is the world’s fifth-largest oil company, turning over $303.7B in 2018 and producing 4.1 million barrels of oil per day.

One of the petrochemical industry’s ‘supermajors’, BP was once perilously close to never existing at all.

The story has its beginnings in the small Central Queensland town of Mount Morgan, just South of Rockhampton – specifically with one William Knox D’Arcy.

William Knox D’Arcy [image sourced from the State Library of Queensland]
William Knox D’Arcy [image sourced from the State Library of Queensland]

D’Arcy was born on 11 October 1849 in Newtown Abbot, England, moving to Rockhampton with his family in 1866, and qualifying as a solicitor in 1872.

An excerpt from D’Arcy’s admission to practice as a solicitor [IID: 1082853]
An excerpt from D’Arcy’s admission to practice as a solicitor [IID: 1082853]

D’Arcy did well speculating in land and gold stocks, buying significant portions of land around the Rockhampton area. This included a portion of approximately 23 acres in the Parish of Gracemere (the modern-day town of Gracemere) in 1870 …

An excerpt from the Memorandum of Conveyance between Reginald Lockhart Graham and William Knox D’Arcy for Portion 163 in the Parish of Gracemere, County of Livingstone (IID: 3247963)
An excerpt from the Memorandum of Conveyance between Reginald Lockhart Graham and William Knox D’Arcy for Portion 163 in the Parish of Gracemere, County of Livingstone [IID: 3247963]

… over 145 acres in the Parish of Murchison (the modern Rockhampton suburbs of Norman Gardens and Kawana) in 1880 …

An excerpt from the Land Selection File for D’Arcy’s purchase of Portion 144 in the Parish of Murchison, County of Livingstone (IID: 56101)
An excerpt from the Land Selection File for D’Arcy’s purchase of Portion 144 in the Parish of Murchison, County of Livingstone [IID: 56101]

… and 1873 acres in the Parish of Fitzroy (near The Caves) in 1883.

An excerpt from the Land Selection File for D’Arcy’s purchase of Portion 2159 in the Parish of Fitzroy, County of Livingstone [IID: 56646]
An excerpt from the Land Selection File for D’Arcy’s purchase of Portion 2159 in the Parish of Fitzroy, County of Livingstone [IID: 56646]

D’Arcy began his involvement with mining in 1882 when three brothers – Fred, Edwin and Thomas Morgan – pegged out claims at Ironstone Mountain (later renamed Mount Morgan).

Unable to raise sufficient funds to exploit the claim, they approached bank manager T.S. Hall, and on suggestion also approached William Pattison and D’Arcy – the three men forming a syndicate which would eventually become the Mount Morgan Gold Mining Co. in 1886 (after the Morgan brothers sold their interests in 1883).

Excerpt from the index to applications for gold mining leases at Mount Morgan. Shows the Morgan brothers’ original claims, plus subsequent claims by the Mount Morgan Gold Mining Company. [IID: 85947]
Excerpt from the index to applications for gold mining leases at Mount Morgan. Shows the Morgan brothers’ original claims, plus subsequent claims by the Mount Morgan Gold Mining Company. [IID: 85947]
Miners at the Mount Morgan cutting face in 1897 [IID: 1108512]
Miners at the Mount Morgan cutting face in 1897 [IID: 1108512]

D’Arcy’s venture into mining made him a millionaire, his social ambitions leading him to return to England permanently in 1887, purchasing Middlesex mansion Stanmore Hall, as well as a townhouse in London.

William Knox D’Arcy and his second wife Nina Boucicault at Stanmore Hall [image sourced from Stanmore Tourist Board]
William Knox D’Arcy and his second wife Nina Boucicault at Stanmore Hall [image sourced from Stanmore Tourist Board]

The opportunity to apply his acumen – and wealth – to a new business venture came in 1900 when former British minister to Teheran Sir Henry Drummond Wolff approached D’Arcy with a proposal to invest in oil exploration in Persia (modern-day Iran).

In 1901 D’Arcy obtained the D’Arcy Concession – a sixty-year contract giving him exclusive rights to explore, obtain, and sell oil over a territory of around 1,242,000 square kilometres (around three-quarters of Persia). And exploration began.

A modern map of Iran’s known oil and gas reservoirs [image sourced from Wikimedia Commons]
A modern map of Iran’s known oil and gas reservoirs [image sourced from Wikimedia Commons]

Two years and £150,000 later, no oil had been found. D’Arcy was forced to mortgage his Mount Morgan stock to continue exploration.

Word spread that D’Arcy’s concession was for sale. He received an offer for his rights on 20 May 1908 from the British-owned Burmah Oil Company, in return for 170,000 shares in the company and a payment to cover previous expenses. D’Arcy accepted the offer.

With no hope in sight, the company sent a telegram to engineer George B. Reynolds, ordering him to “cease work, dismiss the staff, dismantle anything worth the cost of transporting to the coast for re-shipment, and come home.” Fortunately, Reynolds delayed. Just six days later, on 26 May 1908, he struck oil, unearthing the world’s largest oilfield.

Burmah Oil Company’s big discovery at Masjid-i-Suleiman on 26 May 1908 – the first-ever well to hit oil in the Middle East [image sourced from Pinterest]
Burmah Oil Company’s big discovery at Masjid-i-Suleiman on 26 May 1908 – the first-ever well to hit oil in the Middle East [image sourced from Pinterest]

Burmah Oil later formed the subsidiary Anglo-Persian Oil Company (APOC), of which D’Arcy was a board member of until his death on 1 May 1917. The company, after changing its name to the Anglo-Iranian Oil Company in 1935, went on to be renamed British Petroleum in 1954.

Workers changing the Anglo-Iranian Oil Company sign to British Petroleum at Britannic House in London [image sourced from Stanmore Tourist Board]
Workers changing the Anglo-Iranian Oil Company sign to British Petroleum at Britannic House in London [image sourced from Stanmore Tourist Board]

So, next time you fill your car up at a BP service station, spare a thought for William Knox D’Arcy, the former Rockhampton local whose entrepreneurial success at Mt Morgan would help establish today’s global oil industry.

Sources
I. http://leaders.slq.qld.gov.au/inductees/willian-knox-darcy/
II. http://adb.anu.edu.au/biography/darcy-william-knox-5882
III. https://www.bp.com/en/global/corporate/what-we-do/bp-at-a-glance.html
IV. https://www.britannica.com/event/Iranian-Revolution
V. https://commons.wikimedia.org/wiki/File:Iran_Oil_and_Gas_Fields.png
VI. https://www.eia.gov/tools/faqs/faq.php?id=709&t=6,
VII. https://www.eia.gov/international/analysis/country/IRN
VIII. https://www.oilandgasiq.com/strategy-management-and-information/articles/oil-and-gas-companies
IX. https://www.pinterest.com.au/pin/375980268865000996/
X. http://www.stanmoretouristboard.org.uk/william_knox_darcy.html

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