The petroleum excitement has till recently affected California but little, not enough to stimulate thorough explorations or careful consideration of known facts. As a change is now occurring, and as speculation in oil claims is likely to be warm it is possible that California oil stocks may soon be found in the New York market and you may be glad to have some information on the subject.

When last in San Francisco, I was in the way of learning the most that was known and could not ascertain that a merchantable quality of oil had yet been produced by any of the companies whose claims lay near the coast. The Buena Vista Company on the contrary, whose claim was at too great a distance from market to have obtained any attention in San Francisco, had produced oil of superior quality.

I shall be able to enclose herewith the report of an Engineer upon the claim of this Company made yesterday, and which is now printing at Mariposa (See Report). I add the following facts.

The Company now owns a body of land bf the form indicated in the enclosed diagram A. being eight quarter sections or 1280 acres. It has taken measures to secure four adjoining quarter sections. On this land between the points a. and b. oil is constantly oozing from the surface and sometimes forms a sluggish stream, with no obvious mixture of water. At c there is a frequent ebullition of oil, and at d just above it, the Company have recently bored to a depth of 30 feet, when their tool broke, the oil rose rapidly to within seven feet of the surface, and was still rising at the last report. The stream of oil having been frequently burned, the ground through the whole length of the claim is covered by a deposit of asphalt several feet in thickness. I suppose that these facts indicate the existance of a supply of oil within easy reach much greater than anything known in the Eastern States. As to the quality, the Engineer’s report gives you all the information I have.

The Company, which is composed mainly of men in the employment of the Mariposa Company, have authorized their officers to sell a controlling part of their stock at the rate of $1.250.000 for the whole.

As the facts became known which are mentioned in the Engineer’s report, the newspapers at the same time containing many accounts of fortunes made in the East by oil speculations, several persons who had travelled on various occasions, generally in pursuit of stray stock, called to mind that they had seen other oil springs. Three of these I have [286]examined and from their evidence think the fact is established that oil flows from the surface, (usually free to all appearance from water) at several points through a region reaching nearly from Pacheco Pass on the North to the Tejon Pass on the South, (See tracing enclosed) being the foot hills of the Eastern slope of the Coast Range, distant from Mariposa from fifty to one hundred and fifty miles. The country is much of it without water, is uninhabited and has been but imperfectly explored. Extensive valleys within the mountain range to the Westward, have been looked into, but have probably never been passed through by whites. In the upper part of it there is abundance of wood and occasional springs of good water. In the lower part the water is all salt or sulphury. There is neither wood nor water near the Buena Vista springs. But both wood and water, and it is said coal (of poor quality) are found near some of the known springs.

All the known springs have already been claimed or soon will be, several parties being now on foot for the purpose. A rush to the region is in fact now commencing and as soon as grass has started the whole will be thoroughly explored. In from one to two months unless there is a collapse in the Eastern speculation numerous companies will probably be incorporated.

The grand difficulty with which they will have to contend is the distance of the region from navigable water. There are three outlets which may be used. The Buena Vista Company expect to carryover the Coast Range to the port of San Luis Obispo. From the Northern point of the region it would be best to wagon down the valley to the head of navigation on the San Joaquin which owing to shifting sand banks is an uncertain point. Boats go every Spring however as high as Frezno City. The third route would be by Pacheco Pass from which to San Jose fifty miles distant there is a good wagon road. At San Jose there is tide water and a railroad in operation to San Francisco.

Hitherto in the prospecting, the question of transportation has had no consideration, but by my advice parties now leaving here will particularly examine those parts of the region with regard to which information is wanted to determine its Northern and Western boundaries, and it is probable that good springs may be found much nearer to Pacheco Pass and the San Joaquin river than any yet known.

The Dusy springs (see map) are as you will observe within forty miles of high water navigation, and have the advantage of wood and water close at hand. These are the most Northern springs yet known, but I have engaged that a search should be made still further to the Northward and nearer to the river.

I should think that oil might be carried from this point to San Francisco or Antioch at a cost of about 15 ct. a gallon, when the river is high enough for boats to reach Frezno City.

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I mention Antioch, because at that point there are good coal mines and sea going vessels can be loaded. It is a question therefore of whether if the business should become extensive, refining works may not be best established there, rather than on the ground. An irrigating canal from a point near Frezno City to near Antioch has been formerly projected and the plan will be likely to be revived, with the intention of making a canal available for boating as well as for irrigation. It is more likely however that refining works will be established in connection with the wells, where fuel and water can be obtained, as the expense of transportation will then be reduced.

If from the facts I have thus given you it should appear that a large business is likely to grow out of this beginning and if you should be disposed to bring a stock based upon it before the New York market, I would suggest that you telegraph your views to me and if you think best send a competent agent to visit the region. It would probably be practicable any time within two months to consolidate all the best locations under one company, the business of which, if there is any profitable business to grow out of these discoveries, would be developed with great rapidity and to an unlimited extent.

Should you particularly wish it I could probably make a short visit to the region in the latter part of February.

One claim has already been located in my name (without my knowledge) and the President of the Buena Vista Company who leaves here on a prospecting trip tomorrow, proposes, if he makes any promising discoveries to make me one of the claimants. I have taken the liberty to give him your name as another which may be used for the purpose. If any property should be thus acquired it will of course be optional with you to accept it.

I have sent to San Francisco to obtain all needed information to enable me to judge of titles &c. and shall endeavor to be generally prepared to act for you if there should be occasion.

I have no stock or interest in the business except as above indicated, but nearly all those interested at present give me their confidence.

I have received nothing from you since the date of my report on the Manganese Mine.