The buying of timber land for the purpose of securing the bark is naturally incident to the tanning business The company owns a large amount of land acquired in this way and owns and operates some sawmills for utilizing the timber on it — Lewis H. Lapham, 1901.[1]

Western Pennsylvania is well known as the birthplace of America’s petroleum industry. Edwin Drake’s construction in 1859 of the nation’s first large-scale oil well laid the foundation for the industry that spread from Pennsylvania’s forests to the desert southwest within four decades.

Henry G. Lapham (and Lewis Lapham’s father) was a New York leather entrepreneur and an accidental participant in the founding of America’s petroleum industry. Lapham (1822-1888) was a leader in the sole leather industry’s vertical integration to secure tanbark for the New York and Pennsylvania tanneries that provided his New York City-based leather brokerage with raw materials. By the time he died in 1888, Lapham and his colleagues had set the stage for the creation of the wealthiest company in the United States (on paper) at the time: the 1893 incorporation of the United States Leather Company.

Landowners in Pennsylvania’s oil region executed leases with oil entrepreneurs and vertical integration spurred investment in railroads, pipelines, barrel manufacturing, and other industries tied to the extraction, processing, and shipping of oil. At the same time the oil industry was getting its start in northern and western Pennsylvania’s forests, leather tanners who had expanded from New York’s Catskills and Southern Tier were buying up hundreds of thousands of acres to feed bark mills in their tanneries.

Lewis Lapham in 1901 submitted testimony to the U.S. Industrial Commission which was investigating trusts:

The transportation of bark is exceedingly expensive in proportion to its value It is our aim to supply every tannery with bark from within a radius of 20 or 30 miles When the tanneries were independent each got bark where it could or where it happened to acquire bark rights and they often reached into each other’s territory to their mutual loss It might seem that the cost of the transportation of bark might be saved by extracting the tannin and shipping the extract This is done to some extent the company uses some bark extract It uses it however only in connection with liquor made directly from the bark It has not been found possible in practice thus far to get good results from a liquor made entirely from extract Moreover the tanneries use the spent bark for fuel and if they did not have it they would have to buy coal.[2]

H.G. Lapham was a Vermont native who in 1854 went to work for his uncle, tanner turned leather merchant Anson Lapham. Anson Lapham had gone to work in New York City’s Swamp District in the 1830s. By 1840, Anson was in a partnership with tanner Joseph E. Bulkley. Lapham and Bulkley remained in business until the 1870s when it was succeeded by H.G. Lapham & Company.

The Laphams and their partners bought and built tanneries throughout New York and Pennsylvania’s hemlock forests. Their Pennsylvania tanneries included the failed Palen tanneries in Canadensis (Monroe County) and Tunkhannock (Wyoming County); Sterling Run Tannery (Cameron County); and, Warren County’s Clarendon Tannery.

The latter location was a tannery owned by H.G. and Lewis Lapham and their partner, F.H. Rockwell. At Clarendon, the partnership did business as F.H. Rockwell & Co. Rockwell owned the local assets and Lapham provided much of the capital, according to R.G. Dun & Company credit reports and trade publications.

Franklin H. Rockwell (1844-1911) was a tanner who by the early 1880s was producing more oil than leather due to his extensive landholdings in Pennsylvania’s oil region. In the early 1880s, however, Rockwell was worth substantially less than Lapham’s estimated million dollar pedigree. It’s not surprising that Lapham’s capital helped launch Rockwell’s oil business. And, the younger tanner in 1886 bought an 110,000-acre ranch in Sonora, Mexico with Lapham’s sons, Lewis and John. Lewis later helped underwrite the founding of the Texas Fuel Company, which later became the Texas Oil Company, and, finally, Texaco.[3]

The leather and lumber businesses did well for H.G. Lapham and his partners. Their successes and failures were followed by the trade press and by popular publications like the New York Times. H.G. Lapham left few personal and business papers behind before his 1888 death. One document, however, did capture Lapham’s Jed Clampett moment on November 25, 1881. Lapham kept an infrequent journal starting in the early 1870s documenting his travels to various tanneries and on personal excursions. His entry on that autumn day in 1881 captured his recognition of the oil’s significance. In more than a hundred pages of entries, Lapham underlined just one entry: his visit to the Clarendon, Pennsylvania, tannery. “In inventory we did not estimate anything for value of oil or gas in the land,” wrote Lapham. “I think we underestimated our real estate for Tannery purposes and the value for oil may be very very large as developments shows.”[4]

H.G. Lapham’s interests in oil were sidebars in published biographical sketches and his obituaries. “He took an active part in the production of petroleum in Pennsylvania and Ohio,” wrote Henry Hall in 1896.[5] Lewis Lapham’s 1934 New York Times obituary connected the dynastic dots in the family’s trajectory from tanners to oilmen: “Mr. Lapham was born in Brooklyn, son of Henry G. Lapham, head of the leather firm of his name,” wrote the Times. “The son started to learn the business at age 19 … Through discovery of oil some thirty-five years ago in a region of Pennsylvania where he had owned a tannery, Mr. Lapham enter the oil industry and helped to form the Texas Oil Company.”

The Lapham leather firms dissolved more than a century ago. The U.S. Leather Company, however, morphed from a leading leather producer to a company that relied on assets acquired to secure tanbark for its tanneries. The American leather industry declined precipitously in the first half of the twentieth century. Synthetic products like rubber and increased costs for tanning in the United States sent much of the nation’s leather making overseas.

By the 1950s, much of the vast capital invested in the United States Leather Company was concentrated in their bark and lumber lands. In 1951, the New York Times published an article under the headline, “Old Wall St. Names Not What They Seem; Say One Thing and Mean Something Else.” Business reporter Thomas P. Swift wrote, “United States Leather struck it rich in Clinton County, Pa., when it brought in one of the most prolific natural gas fields ever to be discovered in the Northeast.”[6]

By the end of 1951, the U.S. Leather Company’s board voted to liquidate the company’s tanning assets. As the company began to wind-down its leather production, its expansion into energy continued. “United States Leather Company and the Keta Gas and Oil Company, subsidiary, are drilling for natural gas an intend to continue,” the New York Times wrote in its coverage of the company’s transition from tanning enterprise to energy company.[7] “The strike of oil on the company’s timber lands also appeared to offer great opportunity,” reported the New York Times.[8] In the summer of 1952, the Times reported that the company had sold its remaining leather inventories. “The company, however, retains its wholly owned subsidiary, the Keta Gas and Oil Company,” the paper wrote.

Notes

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