R. C. Macpherson being duly sworn deposes and says:

I have been connected with the oil business in Pennsylvania about twelve years, in producing oil, drilling wells, and buying and selling oil. During that time I have operated about 75 wells. I consider myself an expert in operating wells, and producing oil and in the oil business generally.

From what experience I have had, I know that a well should be continuously pumped if she is a producer of oil. All producing wells in Pennsylvania are pumped night and day with the exception that when the oil territory is exhausted there, and a well has run down to four or five barrels a day, such wells are then called head wells and if by pumping such wells once or twice a day the same quantity of oil can be produced, they then pump them only once or twice a day. In all other cases, all producing wells in Penn. are pumped day and night, including Sundays.

In order to prevent the injury to the well that would result from a failure to pump them continuously, all oil wells accumulate more or less water and unless the wells are pumped continuously, the water accumulates in them and, being heavier that the oil, forces it back through the rock off into other channels, frequently resulting in a total destruction of the well and an injury to the surrounding territory. In all my experience in the oil business, I have never known of a producer allowing his well to be shut down one moment, unless in a case of a breakdown, or something of that sort. In the case of a flowing well, it is extremely injurious to plug it or in any manner impede the flow of the oil and generally results in a total destruction of the well. In Pennsylvania, oil men are so careful and particular with respect to the constant pumping, that if a pump man on duty is found asleep, he is forthwith paid off and discharged.

I have been for nearly three years last past engaged in the oil business in the San Fernando Oil District in this county. I have drilled two wells and am now about to test my producing well. I am familiar with that district. My wells are in the close vicinity of the Pico well. I have visited those wells frequently. I was at the Pico oil claims before any of the wells now there were drilled or commenced.

I know the manner in which those wells have been worked by the California Star Oil Works Company. I know that they have not been properly worked by that company. I know that the wells have not been pumped continuously. I have been at the wells time and time again when they were lying idle and C.A. Mentry, who was in charge of them for the Cal. Star Oil Works Co., has frequently told me that there was no use of pumping them as they had no place to put the oil as it took all their tankage for the flowing well alone. He has told me this frequently at the wells. I know that the California Star Oil Works Co. have not supplied sufficient tankage for the oil produced from the Pico wells. I know it from my own observations, as well as from the statement of Mentry to me.

I have frequently seen the oil running to waste from those wells in large quantities. It ran to waste nearly all last winter. It could be seen almost any time running down the canyon for miles. I have seen it running to waste from the Pico well.

As late as the latter part of February of this year, the Star Oil Works Co. has pumped the wells very little. I know this from my own observation as well as from the statement of Mentry, their superintendant, to me. I have examined and am familiar with the character of the territory of the Pico oil claims and the surrounding territory. In my opinion, because of the character and formation of the rock and soil, continuous pumping of a producing well is more necessary, if possible, in this territory or district, than in the state of Pennsylvania and a failure to pump continuously, in the San Fernando District, is more certain, if possible, to result in permanent injury and ruin of the well, than would be the case in Pennsylvania.

I know that in that state, it is a common practice among oil men to keep and store crude oil in tanks for a long time, as much as two or three years. This is done without material injury to the oil. There is nothing in the quality of the oil produced from the Pico oil wells that would it any more liable to injury, or diminution, the produced from being kept in its crude state, than the Penn. oil, in my opinion. The oil produced from the Pico oil wells, if properly tanked, can be kept without material injury for as long a time in the crude state as the Penn. oil is kept in the same condition, and even be this oil, by reason of the dryness of the California climate, should evaporate more, it could be brought back to its original condition by pumping in fresh oil.

About one year ago I made a contract to sell 1000 barrels of crude oil, to be delivered at my wells in tanks, at $3.00 per barrel and I was offered as high as $5.00 per barrel for crude oil, to be delivered in the same manner a short time afterwards. About the same time I offered to turn over to R.S. Baker my contract, for the sale of crude oil, at three dollars per barrel, and September the 21st 1877, I purchased of R.S. Baker 100 barrels of crude oil, at #3.00 a barrel, to be delivered to me at the Pico wells, and he gave me an order on the Cal. Star Oil Works Co. for the same. I presented the order to the company and demanded the oil and they refused to deliver it to me. I know that during the time the California Star Oil Works Co. have had charge of those wells, that R.S. Baker could have sold all of his crude oil for $3.00 per barrel in tanks at the well.

R. C Macpherson

July 2, 1878