The Signal Tribune newspaper

A look at bygone days | June 15, 2018

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Life on Signal Hill would never be the same after Thursday, June 23, 1921, when the Shell Oil Company struck oil at its well at Temple Avenue and Hill Street. At 9:30pm, the Shell gusher came in, spraying oil for a radius of 300 feet. The bringing in of the well sent the price of Signal Hill leases sky high with several leaseholders refusing as much as $8,000 an acre for their holdings. Oil fever quickly spread. Sandberg Petroleum Company, with massive Signal Hill oil holdings, was swamped with people wanting to invest in their company. Within 48 hours of the Shell discovery, Sandberg sold $112,000 worth of stock.

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Photos public domain
First oil well on Signal Hill, 1921

The possibility of sudden wealth had a universal appeal, and an incessant flow of promoters, both honest and dishonest, were soon on the scene. Real-estate promoters around Signal Hill could barely keep up with sales. Even the City of Long Beach, which owned 36 acres of land between the Shell and Sandburg holdings, had a grandiose dream– becoming the richest city in the world, a city that would end taxation.

The oil bonanza of 1921 continued. Shell well no. 2, Nesa, on the west slope of Signal Hill, struck oil at 12:45am on Sept. 2. It came in with such an explosion that everyone thought an earthquake had struck. People as far away as Los Angeles were awakened by the blast. Other wells struck black gold on Oct. 26, Nov. 17 and Dec. 13. On Nov. 28, the city-owned municipal oil well hit pay dirt, shooting 200 barrels of fluid above the top of the derrick. For many years afterwards, this single well brought $360 a day into Long Beach city coffers.

Amid all of this oil, Signal Hill– which had been renowned for its scenic grandeur, productive soil and magnificent homes– was transformed, with land prices soaring to undreamed of heights. A 1906 advertising brochure had described it as “the most beautiful home site in Southern California.” But things had now changed. Building restrictions, paved streets and walks and curbs were supplanted by oil leases, oil stocks, derricks and drills. Palm trees and rose gardens were trampled to make way for boilers, tool houses and speakeasies. Los Angeles Times reporter Syl MacDowell summed it up: “Where the oil monster sets its foot, beauty flees.”

It was now dangerous living on Porcupine Hill, called so because of its prickly appearance from all the oil derricks. People were regularly routed from their homes by blowouts from the oil wells. Often, it was so sudden residents fled like the inhabitants of Pompeii before the streams of lava. Families escaped through the rain of greasy crude oil, leaving behind everything but the clothes they were wearing. They would pile into their automobile, trying to drive to safety but finding it difficult to get through the oil that coated everything. On returning home they found their once white residences now black, trees in their orchards stripped of branches by the clinging oil, the contents of their homes worthless and their houses, soaked with highly flammable oil, a fire trap in which no one could safely live.

H.F. Ahlswede described his experiences:

“After the experience with the three gassers we knew that it was only a matter of time when we would have to move. I want to tell you that it is very difficult to live as neighbor to one of these roaring gas wells. The first gasser was something of a novelty and proved there was something under the ground that resembled what they had been drilling for. When the fourth gasser suddenly developed into an oil gusher and commenced to pour sand and rocks about our premises, we knew the time had come to leave Signal Hill.”

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Oil in the streets, January 1922

Houses, streets and sidewalks were often covered with sticky black tar; rocks that came up with the gushers hurdled through roofs and windows. The time to leave had come. Fortunately, many left rich, having leased or sold their Signal Hill real estate.

It was a well advertised secret where to go to “relax” after a hard day working the oil fields. Tucked between a real-estate shop and a wedge of brick wall plastered with movie posters advertising local theaters, was a dusty little store that never seemed to open for business. But if you were a Signal Hill oil worker you knew that the door was unlocked at night and that behind a screen of dirty stacked boxes was a bare-bones little speakeasy, a sofa, four tables, a plywood bar along the back wall, a fair supply of whiskey and a bartender who slept on the sofa after the bar closed. It was a new frontier, with its society of rugged men working themselves to exhaustion, and then taking their evening pleasures in speakeasies where music blared, girls danced, gambling flourished and the whiskey flowed.

Working the Hill became more difficult as time went on. At first the oil came naturally, almost gushing to the surface on its own momentum. Later it had to be pumped. By 1927, wells at Signal Hill were reaching 5,000 to 7,000 feet beneath the surface of the earth. Despite the fact that finding oil was becoming a little more difficult and expensive, “oil fever” still flourished.

Throughout downtown Los Angeles, salesmen haunted intersections and doorways insistently accosting passersby with free tickets to the oil fields. In residential neighborhoods saleswomen trooped door to door distributing passes. Every morning hundreds and sometimes thousands of people would use these free passes to depart for the oil fields. The buses arrived at the petroleum grounds by noon, and a free lunch was the first order of business. Lunch was served in tents that resembled those of traveling evangelists. While eating in what locals called “sucker tents,” “lecturers” discussed the maps of the oil fields that covered the walls. Experienced promoters knew all sorts of tricks to entice investors. Following the free lunch, they would take a gullible group to a well with minimal oil production and show how it could be turned it into a gusher by inserting a small pipe connected to an air compressor. They advertised astonishing oil-finding devices that guaranteed against dry holes. These gadgets generated thousands of dollars in sales, but they didn’t live up to their claims.

A Sunday at the oil fields offered special treats. Tent shows included parachute jumps and brass bands. Some promoters hired clergymen, judges, politicians and other figures of prominence to meet the crowds, reportedly paying these “respectable” people as much as $1,000 a week for their endorsements. When the lecture ended, “the slaughter of the lambs” commenced. Salespeople descended into the crowd. Audiences, primed by the afternoon’s promotion, responded avidly. One observer commented that the people acted less like investors than an audience at some form of séance. Intense emotion rather than cold calculation was the predominant note.

Real estate as well as oil investment became a booming business. All of these newcomers had to live somewhere. How about buying land for a home and keeping the oil rights under it? Such was the sales pitch used to sell property in the California Heights tract (bounded by California Avenue, Orange Avenue, Wardlow Road and Bixby Road in Long Beach), which opened during the oil boom of 1922.

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Excursions to Signal Hill were a popular way to sell shares in future oil ventures.

When the Jotham Bixby Company placed 830 lots on the market on Oct. 10, 1922, the real-estate vultures descended in droves. The tract was just 1,500 feet from the Wiley No. 1 oil well, and lot purchases included oil rights. Who was to say that oil wouldn’t be discovered under the new tract, making their owners wealthy? One ad stated: “You could stand on one corner of California Heights and with a 30-30 rifle shoot the lights off the top of dozens of rigs– where gushers are spouting thousands of barrels of the liquid gold daily. That’s how close we are to real money. Oil has made more rich men in Long Beach, in a shorter time, than all other interests combined. Are you among them? This is ‘Your Ship’ but you’ll have to step lively to get aboard.”

Within four hours, 185 lots were sold, within 24 hours 250. A syndicate of local businessmen who planned to drill for oil purchased 25 of them.

There was a problem with building houses on top of a potential oil field. Why spend money on installing water and gas lines when oil might be discovered at any moment? Because the question of oil beneath the property remained unsettled, improvements in California Heights were slow. It wasn’t until Nov. 15, 1923 that water, gas, telephone and electric mains needed to build houses were complete. Once these were in and it became evident that not much oil was under the tract, residential development began. The Bixby Company got things off to a start by building 25 ready-made Spanish type bungalows that they sold on an “easy payment plan.” Other homes were built on a parcel-by-parcel basis, creating a variety of home styles including California bungalows, Spanish colonials and Tudor-style homes.

Oil workers knew where to find the speakeasies.

Long Beach was anxious to annex this potentially oil-rich territory, and in an election held Dec. 28, 1923, California Heights and other territory surrounding Signal Hill (identified on annexation maps as “Greater Long Beach”) became part of the city. However, residents of the Signal Hill area, now surrounded by Long Beach, were ardent opponents of annexation. Why share the wealth with Long Beach? Why not spend it on ourselves? This philosophy led to a new birth.

On April 7, 1924, the City of Signal Hill was created when voters in the oil district cast 348 ballots in favor of incorporation and 211 against. Because of oil, they were now the richest city in America.

Burnett is a former Long Beach librarian who, during her 25 years of researching local history, has uncovered many forgotten stories about Southern California that she has published in nine books. She has degrees from UC Irvine, UCLA and Cal State Long Beach. For more information, visit claudineburnettbooks.com.

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