Judge P. K. Reiter

Conducted by Logan Wilson

February 29, 2012

Mr. Wilson: This is Logan Wilson. It’s February 29, 2012 and I’m in the office of Judge P.K. Reiter in order to take his oral history. The next voice you hear will be that of Judge Reiter.

Judge Reiter: Now I’ll start with Happy Birthday Joy Budde.

Logan Wilson: It is?

Judge Reiter: It sure is. She was born on Leap Year Day the 29^th of February so I think she is about 12 years old, maybe less.

Anyway, I guess it starts with Dad arriving in Mexia. His name was Wilhelm Arthur Reiter Sr. But he went by either W.A. or Bill Reiter and he named his son William, Anglicized name of Wilhelm, because my brother Bill was born in 1924 and the memory of Kaiser Wilhelm was still in the minds of one and all. The German Wilhelm was not a popular name. As I said, Dad arrived here in Mexia, got off the train on April 1, 1919 after he mustered out of the American Expeditionary Force and gone to Tulsa to work for his old friend and college mate F. Julius Fohs. Mr. Fohs was a tall, very slender man, and very much an academician but also very much business oriented. But I guess I ought to go back a little bit. Dad’s grandfather and grandmother, that would be Conrad Reiter and Lizzie Reiter, came to the United States. Probably Conrad was born in about 1825 in  south-central Germany. Settled in Pittsburgh, Pennsylvania and had the golden touch. By the 1850’s Conrad Reiter had Allegany Mining Company, had a brewery, of course every German had a brewery of his own, he had a railroad, had his fingers in a lot of pies, but especially minerals were of interest to him. Colonel Drake discovered oil at 69 ½ feet on August 27, 1859 in Titusville in northwestern Pennsylvania. That attracted Conrad Reiter and he bought some leases near there, in fact we have a picture on the wall of the Columbia Oil Company leases, I meant to show that to you earlier, and it has wooden derricks and I believe I have seen in the past on that photograph a wagon with wooden barrels of oil being drawn by teams of mules to market. Conrad Reiter had 3 children, Dad’s father, William Theodore Reiter, was the very personification of a playboy. He had a wonderful time. Lost an arm on a railroad accident, on his father’s railroad, went blind and died in 1899. Also went broke in the depression/panic of 1893-1896. Dad was William Theodore’s only child and moved with his mother, Carrie Putnam, to the only property left by his father a 200 acre farm in western Kentucky. It had been bought for lead, however it turned out it had no lead but fluorspar on it, which is used as a catalyst in the production of steel. Turned out that the lead was a result of a gunshot in the side of a hill. Dad was very much interested in mining and he went to the University of Kentucky, taking Mining Engineering. He was there with his friend F. Julius Fohs, who was also from western Kentucky. Dad then worked for a while for the U.S Geological Survey in eastern Kentucky.  His boss had told a farmer in Eastern Kentucky that there’d never be any oil found in that part of the world, there just wasn’t any oil there. Dad used to chuckle and say the last time he knew there were 26 oil wells on this farmer’s land. The weir sand went about 1200 feet deep.

Going forward a bit, Dad went into the Army in WW II, then came back to Tulsa and worked for F. Julius Fohs in 1919. Mr. Fohs sent him down to Mexia to find some more shallow oil and gas such as near the Corsicana oil fields.  It was found in 1896 when they were drilling for water east of the town of Corsicana.  Of course the Corsicana water well drillers were terribly disappointed because at 900 feet they got oil instead of water. Then in 1904, after Spindletop in Jefferson County, another shallow oil pool was found near Corsicana. In those days, before logging, all they had was driller’s oil and you couldn’t recognize for sure which rocks were which except from the use of paleontology and nobody was that sophisticated at that time. Anyhow, Dad came down to Mexia, arrived on April 1, 1919. He looked around the countryside and went to Blake Smith Sr., the owner of Mexia Oil & Gas, who had a series of shallow gas wells about 600 feet deep west of Mexia.  Actually there was gas production all the way from the northwest end of Mexia just west of highway 14 all the way down to Groesbeck. Gas was sold from those wells to Waco, Corsicana, Teague, Groesbeck/Mexia, Tehuacana, Coolidge. The shallow wells produced a fair amount of gas but didn’t last all that long because it was so shallow. Dad had read a paper written by a fellow named Matson in 1915 about the Mexia gas field. It mentioned the possibilities of there being hydrocarbons in deeper beds thought to be here-the Woodbine which produced fresh water at Corsicana at the Magnolia Refinery. So dad went back to Tulsa and ran into a promoter by the name of John Sheppard who was there in the Tulsa office of Fohs. Mr. Sheppard, according to Dad said “Bill, what you got that looks good?” And Dad said “Well, I’ve got this block down in Limestone County Texas. They’ve got some shallow gas production and I think it’s worth a try at a deeper bed. Matson wrote this paper that suggested it could possibly be productive at Woodbine.” “Well how deep will that be?” “Well, it’s hard to tell-2500 feet to 2800 feet, something like that. But you don’t know how deep it’s going to be until you drill it”. So he said “Well get the acreage together and I’ll drill it”. So Mr. Sheppard moved in a rig to drill here in Mexia for the Woodbine. Dad held the stake for the discovery well, my mother drove it in-this was before they were married. I’m sure he was a little concerned about the safety of his hand holding the stake. At any event she drove the stake for the discovery well- the # 1 Rogers. Mr. Sheppard got down to about 2400 feet into the Austin chalk and was having great difficulty. He ran out of money. There was another promoter from Denver name of A.E. Humpfries who had expressed an interest in drilling a well here at Mexia but frankly didn’t have the money and so he didn’t get involved. Sheppard contacted him and he said for ½ interest he’d put up enough money to drill the rest of the hole. There was some question about whether or not he had the money even then. It was hard digging in the Austin chalk with cable tools. The well got down to about 2600 feet, still in the Austin chalk, and Sheppard ran out of money again. So John Sheppard gave the rest of his interests in the Mexia acreage to Colonel Humphries, as he was known later, to complete the well. Mr. Sheppard kept 4 leases in the area. However his secretary forgot to pay the rentals so he lost those too. So the man that really did the drilling end of the Mexia discovery got nothing out of it. Colonel Humphries, always a great showman-an incredible showman, swooped through town and said “OK we’ll drill this well to a finish and let me know how it turns out. I’ve got a fishing trip down off shore on the Texas coast so keep me posted.” Before anybody asked him to see the money, he headed on down off shore. He had a signal that they’d raise a flag on shore each day. If it was a black flag-no oil yet. A white flag they had a discovery. So he stayed away from anybody that wanted to get paid until the white flag went up. You can read that by the way in the paper done by Nanine Simmons in 1955. It’s an excellent presentation on the day-to-day of what happened in Mexia when the oil boom hit. The well came in on November 21^st as I remember, 1920. However the #1 Roger wasn’t that much of a well. Maybe it flowed 100 barrels a day at the beginning. But it was oil from a formation not known to be oil productive.

Dad, by that time, had been sent by Julius Fohs to West Texas and Leon English, one of the stable of geologists that worked for Mr. Fohs, when they got the telegram about the #1 Rogers coming in and said  ”Ah another 5 barrel gas well”. They were not all that impressed with it at that time. But the boom was on. Some of the leases on the west edge of what was thought to be productive, maybe 2000 feet from where the gas production was, were drilled and came in for a 1000 barrels a day-then 5000 barrels a day-one of them came in for a 1000 barrels an hour. They laid a 6 inch flow line, 6 inch diameter flow line, from the well head. Six inch casing at the well and put a 6 inch ell on the top with a valve below it and then ran a 6 inch line to a loading rack. And they would load the tank cars straight there from the wells. The pumper would open the valve and fill the car, close the valve and the switch engine would pull the next tank car up to be filled up. It was incredible. Mexia’s population went from 4,000 to 55,000 in a matter of a couple of months. It was absolutely a remarkable oil field.

Mr. Wilson: This was all done with cable tools?

Judge Reiter: Well the first well was with cable tools. And that well had an interesting history because down about 40 feet there’s a boulder bed in the Midway Clays. Cable tools had to spud past that boulder bed. They had to come out with a bit, dress it and a boulder would roll in. Then they’d have to spud by it again. Pretty aggravating so they just skidded the rig over and started actually the #2 Rogers. Called it the #1. They ran into the same problem with the boulder bed there. So they skidded one more time and the 3rd well, really the #3 Rogers, called #1. A big hole was drilled and set big conductor pipe and then lowered a fellow in with a rope around his ankles and he’d hunker around the boulders and pull them out. Now I don’t know what they had to do to get that fellow to go in the hole but I’m sure it was something very persuasive. Course there was no water in the hole because there are no shallow water beds out there once you get past Wilcox until the Midway Lime.

Mr. Wilson: When did they go to a rotary rig? Was it during this time?

Judge Reiter: Well it was shortly after that. They drilled a well with rotary down to the top of the Woodbine, set 6 inch casing, typically, and then do what they called “standardized”.  They would use cable tools to tail end with to total depth. Of course cable tools don’t work well when you have much water in the hole. They would use rotary tools through the sub-particle and set 6 inch casing at the top of the Woodbine. Then tail in with cable tools. That’s where they made the gushers. They had nothing in the hole but air and when they got in the top of the Woodbine here it came flowing over the derrick. Some of those well made a lot of oil. And again I refer you to Nanine Simmons paper. She talked about the production here in Mexia in her last article.

There were several Woodbine fields found from Mexia north: Wortham, Currie, Richland, Powell. In 1921the Mexia field produced 5,000,000 barrels-1922 35,000,000 barrels. Some of these other fields started coming in late ‘22, ‘23, ‘24 and those years made 53,000,000-59,000,000 and then in ’25, 51,000,000 and so on. Made a lot of oil out of Woodbine. The Luling Field  produced from the Edwards B Lime which is pretty thin here.

Mr. Wilson: That’s where my Uncle Luther lives.

Judge Reiter: Oh really? The irony about the Edwards is: Edwards A is thin but very dense at Luling and as you come north, the Edwards B which is what’s productive down there pinches out and turns into a dense lime like Edwards A at Luling. Edwards A meanwhile gets thicker and more porous as it comes north. Edwards A doesn’t produce oil unfortunately. It has oil showing but is not productive. Edwards B is always productive on structure where it has porosity.

Let’s see. What should I tell you next? Of course we had the famous Jones well down at Kosse. Again that was Dad’s geology, he was still doing surface geology, as a geologist and engineer for Fohs. Fohs had ½ the acreage and Humphries had the other ½ so Humphries asked Dad to continue as geologist and engineer for Humphries Mexia Company, one of the 2 or 3 companies that Colonel Humphries put together. He drilled at Groesbeck on Jack Welch’s place. Jack Welch, a lawyer now deceased, was in Marlin. Those wells made some gas and a little oil. We went back and drilled on Jack Welch’s place in the early 60’s and fraced it but didn’t make a well of any dimension. The Woodbine just pinches out as one goes south. Dad had already figured that out pretty much after the lack of success at Groesbeck. He discovered the Cedar Creek Field about which he commented “I hope this wildcat makes a well even if I don’t make any money out of it.” He was right on both accounts: it made a well but he didn’t make any money out of it. That was because the Woodbine sand that was left there was low porosity and permeability was pretty thin. That was what happened at Groesbeck. He still had the structure drawn to continue on down south in the county to Kosse. The Kosse well was drilled by Colonel Humphries. Dad was the engineer on it. He got word that they had struck oil at 3500 feet, but that was deep for Woodbine. The driller had already gone through the Eagle Ford/Woodbine shale and Buda Lime and into probably the faulted, highly  pressured zone. It was literally a pocket of oil. It blew oil over the crown block. They had to get mules and fresno to dam up the creek. The well produced about 50,000 barrels of oil in about a week and a half then never produce another barrel.

Mr. Wilson: Is that unusual or does just happen every now and again-would you expect it?

Judge Reiter: Well that’s what the Austin chalk play was about. Except they were dealing with a different kind of rock, the Austin chalk. The drilling is horizontal and penetrates minor pressurized zones or micro-faults or mini-faults. These have natural secondary porosity and permeability. The Austin chalk made a lot of oil and has a lot of gas. Many of those wells are still producing but the rate of production is way way down. You can see the wells if you go down the west side of the Little Brazos River from Hearne on Highway 50, through Mumford. You’ll see a whole series of Austin chalk wells along there, but they’re not all that great anymore.

Back to Limestone County, the famous Jones well at Kosse came in the same week as the discovery well at Luling. The newspaper played up the discovery well at Kosse and Luling was sort of an after-thought. The reality was that the well at Kosse dwindled to nothing within 2 weeks and Luling has produced a lot of oil out of the Edwards. Dad, and again I’m talking a great deal about W.A. Reiter Sr., Dad went on to find the Currie field and production in west Texas and Oklahoma. He retired and sold his interest in Reiter/Foster Oil Corporation in February 1929, not having a clue as to what would happen in October 1929, to Bill Reiter and Bill Foster, his friend and partner for many years, on the Board of Directors of Reiter/Foster along with three stock brokers. The stock brokers felt that they needed to wildcat, find production and sell it so he could go wildcatting some more. That way they could promote the stock on wildcats but they couldn’t on settled production. So Dad and Bill Foster knew that wasn’t the way to be in the oil business. Like gaming out in Las Vegas-you’re gonna lose if you keep doing it cause the odds are against you. Anyhow, Dad retired in 1929 and drilled up all the money he’d made. He drilled in what he thought was a salt dome in Leon County, near Marquez. As we learned in the late 90’s it was not a salt dome but a meteor hit which resembled a salt dome. He thought it was the Wolfe City formation brought to the surface by a piercement salt dome. The rocks were melted and made dense by the meteor hit. He drilled, I think, 3 or 4 dry holes around that salt dome. And then he drilled 2 Woodbine dry holes up in Navarro County on Dr. Bounds land north of Wortham. The Currie Smackover field was later found about 6000 feet deep.

So in 1935 he was pretty much broke and went back to work for Julius Fohs in Houston. We moved to Houston in ‘35/’36 and found a lot of oil for Mr. Fohs. Found the deepest oil well in the world, at the time, at 13,000 feet at Buckley Burg #1in southern Louisiana in 1939. Then he retired from that and found the Reiter Field and North Reiter Field in Freestone and Navarro Counties and Coit 5 miles west of Thornton in Limestone County. But that’s most of the history of W.A. Reiter Sr. in Mexia.

Mexia had a heck of a fire 1921-’22  which burned much of downtown Mexia, at least 2 blocks. In fact this building you see fire damage back of the building. This building didn’t suffer much damage but some fire damage as a result of the fire that started in the next half of block west of us towards the railroad tracks. The wind was out of the south and blew it across the street and burned those building. So that half a block burned west of us and the block across the street burned.

Mr. Wilson: Did they ever determine, Judge Reiter, What started the fire?

Judge Reiter: Well, you’ll read an interesting presentation on that in Nanine Simmons book. I’m not sure I can find it here. I can give you the date of the fire and what the thoughts were about it. “A roaring noonday fire follows gushers and Marshall Law. The popular theory at the start of the fire was that grease caught fire and exploded in a Chinaman’s hotdog stand in a hole in the wall in the 100 block of Commerce.” This is the 100 block of Commerce, it was right over there just west of us.” The excited proprietor was supposed to have rushed out yelling “Hottie belly, hottie belly”. Actually “Hottie helly, I’m sorry “hottie helly” not belly. “No one recognize the garbled scream as “Hot as hell’ was the Confucius equivalent of fire. Instead of yelling “Fire’ he hollered “Hottie helly”. But unfortunately the fire was out of control pretty soon. There also was the thought, officially believed, it originated in the café across the street from the phone office where the Prentigast Gas Smith & Company Bank was housed, that’s the same area. Whether it was from the Chinaman’s hole in the wall or café, the wind blew it across to the north side of the 100 block of Commerce. That was in early 1922-I believe.

Mr. Wilson: How did the oil boom, if indeed it did, help the economics here during the depression or has the oil boom petered out by then and really couldn’t help with the depression here?

Judge Reiter: Well the depression didn’t really get bad in ’29, ’30, or ’31. It was really ’33-’34 when it really got bad. ’33 was thirteen years after the discovery well came in., 12 years after the field was really developed. The flush production was long since over but there were still a lot of wells being produced out in Mexia fields and up in Wortham in the Wortham fields. It provided a lot of royalty revenue to land owners.

Mr. Wilson: So it did help some?

Judge Reiter: Oh yes. That’s the irony about oil and gas production. Because our government decided, back at the founding of the United States, that the minerals under the land belong to the person that owns the surface of the land. They call it royalty that the land owner has because in other nations it belongs to the Crown, Germany, and England and so on. So it’s called the “Royalty Share” of the production. When this country was founded they said “No. The surface owner owns everything from the surface down to the center of the earth, including the minerals that may exist there.” When this country left England, the people were not very fond of kings and such. In fact the Texas Supreme Court just last week decided that the water underneath your land belongs to you and the Edwards Conservation District could not limit your amount of water usage.

Judge Reiter: Yes oil and gas production benefits the mineral owner which is typically the surface owner. Many of the people in the Mexia area that own farms out west of town, that didn’t sell a portion of their royalty or all of it, benefitted for years and still benefit from the oil production just like up at Wortham.

Mr. Wilson: When did the law change that allowed for surface owners to be divorced from minerals because I know now that there’s 2 owners to a piece of property. Those that own the surface and those that own the minerals beneath. How does that happen?

Judge Reiter: It happened when the surface owner sold a portion or all the minerals. The minerals belong to the surface owner but the owner can sell either royalty or minerals if someone owned the surface and the minerals and sold the surface but kept part of the minerals then both the former owner and new owner would be part owner of the oil and gas.

Mr. Wilson: So it wasn’t a matter of the law changing, it was just a matter of the surface owner selling his minerals?

Judge Reiter: If someone goes out and buys a farm west of town, he may or may not get some of the minerals. Minerals may have already been severed from the surface long back in the chain of title. It never gets re-connected.  It could but it never does.

Mr. Wilson: You know that’s interesting. I learned something because it never occurred to me that there didn’t have to be a change in the law for that to happen. It just had to be the person that owned the surface and the minerals to sell the minerals.

Judge Reiter: That’s right and that’s typical. That happened out in southeastern Limestone County and in Leon County, in Freestone County, Robertson County when Anadarko, XTO, and so on came in to develop the gas in those areas, people went out and bought minerals. Some people sold it and some people didn’t. You can tell the ones that didn’t by looking at the pretty houses they now have.

 But no, there’s a famous case from about 18-I’m guessing about 1812-United States Supreme Court, Harvard was involved, that once a contract is made the government cannot change that contract. But I will also mention that in Louisiana, which adopted the Napoleonic Code back when it belonged to the French, there is a rule of non-user. If the minerals are severed from the surface and the minerals are not used for 10 years they revert to the surface owner. I believe that’s the only state in the United States where that’s true. That’s because that was the law when Louisiana came into the union.

Mr. Wilson: In Texas that’s not the case. Whoever owns the minerals, owns the minerals, as long as they own the minerals, whether they use it or not.

Judge Reiter: And the longer, every year that passes, it becomes more and more difficult to lease for oil and gas operations because you can’t find the mineral owners. Minerals have been severed from the surface back in the oil boom or even earlier down in Southeast Texas. Spindletop, around the salt domes down there, Liberty, Humble and so on, you may not be able to find the heirs of the people that owned the minerals back in 1906. After all that was 106 years ago.

Mr. Wilson: That’s what we call the lease hounds, that’s how they make their money is finding those people.

Judge Reiter: If you can find a lease hound that knows how to run the record. We quit training them in about 1970. There’s some now that learned how to do it but not many. They died off. There was an excellent one in Groesbeck that I was very fond of. She was in the realty business, could run the records and knew how to do it. She was killed in train/automobile accident several years ago.

Mr. Wilson: Imogene White?

Judge Reiter: Yep.

Mr. Wilson: Had a little café in Groesbeck. She was a friend of my grandmother’s.

Judge Reiter: And she had that real estate office right next to Farmer State Bank across from the court house. She was a good, good friend to me.

Mr. Wilson: A tragic accident.

Judge Reiter: Absolutely. Next question.

Mr. Wilson: One final thing.  And I’m not shortening the interview. If something occurs to you go ahead. Judge Reiter, I have asked everyone so far who has contributed to this a question and so far, maybe in different words, I get the same answer and I’m going to try it on you. Sir, if you could tell the young people today, if you could give them some advice, what would it be?

Judge Reiter: Do you have a couple of days? Well I have several things. First of all: education is what makes you have a chance in this world and that’s one thing nobody can take away from you. Secondly: once you have gotten an education, develop a hobby that will sustain you in the event your primary business for some reason is not what you’re able to continue doing. Especially important I see among the judiciary, when they retire, they don’t have a hobby. Golf is okay but you can’t play golf all day every day. You need to have something else even if it’s archeology or geology. I do geologist engineering. You need something else to counter-balance you main profession. Thirdly: don’t trust the government. My experience with people in public office is: they know what sort of person they are. They know that they’re not qualified for the office for which they’re elected and they figure if the electorate is so stupid that they would elect them to do it, then obviously they’re smarter than the electorate.

Mr. Wilson: And they’ll never be caught up with.

Judge Reiter: That’s right. They’re the Bernie Madoffs of politics. Politics is a form of a Ponzie scheme.

Mr. Wilson: It is?

Judge Reiter: It is a Ponzie scheme.

Mr. Wilson: Well that pretty much makes it unanimous then.

Judge Reiter: I guess education is what many people refer to.

Mr. Wilson: Yeah, education and get a job and don’t trust the government and do a good job. Thank you sir.