Battle of the Giants

OIL & GAS

Two giants of the oil business squared off last week for a fight to dominate Canada's natural gas industry. In one corner was Clint Murchison, the flamboyant Texas oil tycoon (TIME, May 24, 1954) who bosses an empire of companies with assets of about $400 million. Against him was Francis Murray Patrick McMahon, 53, multimillionaire Canadian who began as a $4-a-day driller and rose to be a leading operator in Western Canada's spectacular oil boom. The big stake in the contest between them: a franchise to build a $350 million pipeline to carry Western gas 2,200 miles to the cities of Eastern Canada and the U.S. Midwest.

McMahon's challenge took Murchison by surprise. The Texan's company, Trans-Canada Pipe Lines, Ltd., has held the pipeline franchise for almost two years, and Clint Murchison once grandly declared that the building of it would be "the major achievement of my life." But Murchison had trouble financing the deal. The line had to run through an uninhabited area of northern Ontario, which called for a subsidy from the Canadian government and a measure of acquiescence on the part of competing U.S gas companies.

Perfect Timing. While Trans-Canada grappled with its problems, Frank McMahon was a quiet bystander. He was then deep in negotiations to build a 650-mile pipeline to take gas from his companies' fields in Alberta and British Columbia through "the Rocky Mountains into the U.S. Pacific Northwest. But Murchison's delay gave McMahon time to get his Northwest project well under way.

Once he decided to tackle the Murchison interests, McMahon planned a powerful offensive. While Murchison asked for Canadian government aid, McMahon offered to build and finance the entire pipeline as a private enterprise. Instead of threatening to compete against gas companies in the U.S. Midwest, McMahon offered to sell them Canadian gas, let them distribute it. Thus he eliminated many of the objections blocking Washington's approval of Murchison's import permit.

Good Investments. Born in the British Columbia mining town of Moyie (pop. 225), McMahon started as a hard-rock diamond-driller, drifted to Alberta and formed his own drilling company there before the province's oil play began. He took an option on a promising piece of Alberta land and brought in one of the province's first major oil wells at Leduc in 1947. Since then, he has plowed his oil earnings into a steadily successful search for more oil and gas. His companies now own or control hundreds of wells, hold leases on some of the richest oil lands in Alberta and British Columbia; McMahon's petroleum empire is estimated to be worth at least $250 million.

To keep his empire expanding, McMahon during the last two years has spent almost as much time in Texas, Wall Street and Washington as in Calgary. No man to overlook a good investment wherever he is, McMahon helped back two Broadway musicals (Pajama Game, Plain and Fancy), turned a fat profit on both. Last week Millionaire McMahon took time off to be married to onetime Hearst Columnist Betty Betz, 36 (each for the second time), whom he met two years ago.

After a quick Manhattan honeymoon, McMahon went back to the job of trying to wrest the Trans-Canada pipeline franchise away from Clint Murchison. If Frank McMahon is successful--as now seems likely--he will do more than spoil Murchison's dream of achievement. He may even outrank Murchison on the roster of North America's biggest oilmen.

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