"Gusher Age" in the CSA.

Know Nothing

Only Anglo-American oil companies have the know how and capital to take advantage. They urge an influential group of Texans to declare independence. Texas, tired of incompetent governance from the east, goes along.
 

Wolfpaw

Banned
As said, the Confederacy likely won't have the capital to develop an oil industry--that'll fall to Yankee and German companies. Texas will need to choose whether to:

  • Cut its losses and leave the CSA (risking annexation to the US; vassalization is already a given.)
  • Come to an agreement with Richmond that allows Texas to keep most of the oil revenue
  • Remain in the Confederacy at the point of a bayonet
 

SPJ

Maybe is the south economy is low thant northern oil companies like Seneca Oil take advantage of the situation by buying the land with oil on it cheap or get large tax breaks from the government for bringing in jobs.
 

King Gorilla

Most likely not. Texas's oil was discovered rather late and in order to extract it one needed considerable technical knowledge and capital investment. According to your timeline, the boll weevil will be hitting during the 1880's through 1890's. At least another generation of technological advancement would need to go by before said oil could be profitable extracted and transported.

As for the long term consequences of Oil in the confederacy, I cannot help thinking of Dutch Disease

For more readily extractable confederate oil, I'd go for Louisiana's salt domes.
 

Reggie Bartlett

Banned
Wolfpaw said:
As said, the Confederacy likely won't have the capital to develop an oil industry--that'll fall to Yankee and German companies. Texas will need to choose whether to:

  • Cut its losses and leave the CSA (risking annexation to the US; vassalization is already a given.)
  • Come to an agreement with Richmond that allows Texas to keep most of the oil revenue
  • Remain in the Confederacy at the point of a bayonet
Click to expand...

What is preventing influential Confederate entrepeneurs from jumping to the call or investing in the technological needs and capital into such a venture?

Oil fields in Texas, Indian Territory/Sequoyah/Oklahoma, Kansas, Louisiana, Arkansas and TTL's Eastern Arizona (OTL East New Mexico):

Mid-continent_Oil_Field_map.png
 

The Sandman

Banned
Reggie Bartlett said:
What is preventing influential Confederate entrepeneurs from jumping to the call or investing in the technological needs and capital into such a venture?
Click to expand...

The likely nonexistence of influential Confederate entrepreneurs, nonexistence of homegrown Confederate technological development, and nonexistence of Confederate capital.
 

Flubber

Banned
Reggie Bartlett said:
What is preventing influential Confederate entrepeneurs from jumping to the call or investing in the technological needs and capital into such a venture?
Click to expand...


The same hurdles which prevented influential entrepeneurs in the OTL Gulf nations from jumping to the call or investing in the technological needs and capital into such a venture.

Rope in the Confederate constitution's prohibition on government funding for internal developments too. If you don't think that Federal investment in infrastructure played a role in the OTL Texeas oil boom, you need to read more about the oil boom.

King Gorilla was kind enough to post a link to "Dutch Disease", so I'll post one for the Resource Curse[/quote]. Common knowledge aside, oil is not an automatic economic blessing.
 

Hendryk

Banned
Oil didn't turn Mexico into an economic powerhouse, and I doubt that the CSA, with a socio-economic structure rather like Mexico's, would turn out any different.
 

Wolfpaw

Banned
Hendryk said:
Oil didn't turn Mexico into an economic powerhouse, and I doubt that the CSA, with a socio-economic structure rather like Mexico's, would turn out any different.
Click to expand...
Yeah, it wasn't until after World War II that small countries were able to benefit from the natural resources that bigger powers had been extracting from them. We should also remember that Texas was an oiligarchy IOTL; what would prevent that in this scenario?
 

Lost the game

Banned
Northern and British oil companies prompt Texas to secede, then the US military intervenes to enforce that secession. Texas then becomes an Angola/Nigeria-style oil kleptocracy
 
Grey Wolf

Grey Wolf

Donor
Two things

1) a lot of US oilmen made it from pretty much nothing

2) foreign investment in a company does not make it NECESSARILY a foreign company, and I can certainly see British and French banks being willing to invest in Confederate oil

3) bonds are sold to foreign investors, to raise capital at home, this doesn't require actual money from Confederate sources

Best Regards
Grey Wolf
 

Flubber

Banned
Wolfpaw said:
Yeah, it wasn't until after World War II that small countries were able to benefit from the natural resources that bigger powers had been extracting from them.
Click to expand...


Sadly even after WW2 small countries really haven't benefited from natural resource extraction. :eek:

We should also remember that Texas was an oiligarchy IOTL; what would prevent that in this scenario?
Click to expand...

Have oligarchies prevented it from happening elsewhere in the OTL? The Texas oligarchs would look at the oil boom as a way to pad their Swiss bank accounts.
 

Wolfpaw

Banned
Grey Wolf said:
1) a lot of US oilmen made it from pretty much nothing
Click to expand...
The Texas oil boom required the help of a Croat who immigrated to Michigan in 1879, a pair of Pittsburgh wildcatters, the Mellon family of Pennsylvania, significant investment from Standard Oil and Shell, and the obsession of a crazed Texan who (rightly) refused to believe the entire geological establishment. Prior to the Beaumont well, oil in Texas was small potatoes.

That's just the biggest one. Almost every find in the Gulf and Oklahoma required Yankee or foreign capital to back it. In a situation where the majority of Dixie capital will remain sunk into illiquid assets like land and slaves and unstable cash crops like cotton, where is this money going to come from if not from Wall Street or Threadneedle?
Grey Wolf said:
2) foreign investment in a company does not make it NECESSARILY a foreign company, and I can certainly see British and French banks being willing to invest in Confederate oil

3) bonds are sold to foreign investors, to raise capital at home, this doesn't require actual money from Confederate sources
Click to expand...
If a controlling share lies in foreign hands, it is a foreign company. The CEO may live in Tulsa or Beaumont, but he'll be beholden to London or New York.
 
Last edited:

Snake Featherston

Banned
If simply *having* resources were all it took to ensure Great Power status Russia should have been King of the World since the 19th Century to a degree nobody else could have challenged it. The CSA would have a lot of oil, yes. Having it and being able to get anything from it itself is another matter. A really nasty USA-CSA reconquest scenario might be a CS Mossadeqh figure wanting the CSA to control its own (US-financed and US securing 99% of the profits off of) oil and the USA decides to pull an Operation Ajax, which leads to a CS civil War, which leads to US intervention to "protect the new and free regime in the South".....
 

Johnrankins

Snake Featherston said:
If simply *having* resources were all it took to ensure Great Power status Russia should have been King of the World since the 19th Century to a degree nobody else could have challenged it. The CSA would have a lot of oil, yes. Having it and being able to get anything from it itself is another matter. A really nasty USA-CSA reconquest scenario might be a CS Mossadeqh figure wanting the CSA to control its own (US-financed and US securing 99% of the profits off of) oil and the USA decides to pull an Operation Ajax, which leads to a CS civil War, which leads to US intervention to "protect the new and free regime in the South".....
Click to expand...

Yep, the amount that the CSA as a whole is pretty limited. They have just substituted one "Resource Curse" (Cotton) for another (Oil).
 
Grey Wolf

Grey Wolf

Donor
Wolfpaw said:
If a controlling share lies in foreign hands, it is a foreign company. The CEO may live in Tulsa or Beaumont, but he'll be beholden to London or New York.
Click to expand...

A lot of French railways were built originally with British capital

Russian railways were built with French loans

Did Britain own France's railways or France own Russia's?

Best Regards
Grey Wolf
 

Snake Featherston

Banned
Johnrankins said:
Yep, the amount that the CSA as a whole is pretty limited. They have just substituted one "Resource Curse" (Cotton) for another (Oil).
Click to expand...

With the much nastier element that they will be as likely to control their own oil as the poorer and larger Middle Eastern states. As I said, a CS version of Mossadeqh would be.....:eek:
 
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