The Los Angeles Times from Los Angeles, California • 47

in Dea oviets tve THURSDAY MORNING, JANUARY 14, 1965, Pari ill 7 With U.S. Firms Joint Ownership of Enterprises in USSR Dangled as Trade Bait BY GEORGE F. W. TELFER Exchnlvi to The TlmH from Ntw York Htrild Tribun NEW YORKThe Soviet Union is so desperate id expand its trade with the United States that it might allow American firms to own half of some Soviet enterprises they help set up, a chemical industry executive It Costs Dig, but Oilmen Plenty to There's a Payoff said Wednesday. art A THE PETROLEUM INDUSTRY has taken look at what it costs to dig dry holes, and the findings plainly indicate it's no business for operators with limited courage and capital.

A newly published survey, covering activity in 1962, shows that the cost of finding, developing and producing oil and gas in the United States reached $7,372 billion. This was a marked increase over expenditures in each of the three previous years, and most of the gain was in exploration outlays. Exploration ran $2,324 billion in 1962, compared with $1,851 billion in 1961, $2,045 billion in 1960 and $2,012 billion in 1959. Accounting for most of this jump was $815 million in lease acquisition costs, nearly double the 1961 level and. also well up from 1959 and 1960.

But continuing as the largest single expense under the exploration heading was dry hole costs. This item added up. to $847 million worth of frustration in 1962, vs. $774 million in both 1960 and 1961 and $821 million in 1959. The dry-hole tab in 1956 was an even higher $909 million.

A (tar VT1nraf inn nnsts thp TlftVt PTPat- 87 86 85 84 83 82 H1 inuepeuucui. America and 1 A. 1 WEEKS TIMES CHART BY NEW YORK Poor's 500 closed at the day was Volume rose from 5,410,000 ELECTRONIC 'EDITOR' A Raytheon engineer composes messages on the company's electronic "editor;" Called a QRCC (query response communications console), the "editor" can compose, read or edit material from the computer's files. (1941-43 101 lln 1 5 VAlVlUMli. 0- est expense was development.

A total of $1,729 billion was spent preparing producing wells and $537 million went for INDING YESTERDAY -iJr- PICTOOPHICS, I A. equipping leases. Production costs and related taxes added another $2,091 billion and overhead came to $691 billion. These expenses were not entirely in the study's sponsors admit As computed by researchers of the American Brown Appoints Sadler New Commissioner Balderston Resigns State Post to Return to Professorship at UCs Business School BY JERRY GILLAM and THOMAS W. BUSH Timet Staff Writtrt Gareth Sadler, 40, was appointed California savings and loan commissioner Wednesday, succeeding retroieum insumie, me Petroleum Association of A STOCKS: Standard Cr stock index Wednesday 85.84, up 0.23.

Top during 86.27, the low, 85.35. to 6,100,000 shares on Tuesday. OVER-THE-COUNTER: The National Quotation Bureau index closed at another consecutive 1964-65 high of 184.37, up 1.03. The 1964-65 low at 145.48. LONDON STOCKS: The Financial Times index of 30 ordinary shares 'closed at 332.5, up 0.1.

The 1964-65 high stands at 377.8, and the 1964-65 low stands at 322.6. tne jMia-uonuneni un a vas we industry took in $8,431 billion in net receipts from oil and gas production in .1962. This continued a rising trend and Dr. Frederick E. Balderston, who resigned.

In announcing the shift Gov. Brown said Sadler will take office Feb. 1. He has since June, 1963, been chief deputy1 savings and loan commissioner. Lockheed Seen in Line for Job on New Polaris SAN FRANCISCO Wl Lockheed.

Missiles Space Co. has been selected by the Navy to begin preliminary research on a new version of the Polari3 submarine missile, according to unconfirmed reports Wednesday. Rear Adm. Levering Smith, technical director of the Navy's Special Projects Office, the reports said, would make the official announcement Friday night at speech in 'San Francisco. Lockheed spokesmen said they had no official word on the program.

The fourth generation Po laris, the B3, would be a larger version of the present range A3 Polaris missile for delivering nuclear warheads from under water or surface launching. Navy spokesmen have estimated the B3 could double the pay- load for the same range. Lockheed was prime con tractor on the Polaris Al, A2 and A3 development and production programs running into the billions. PETROLEUM apparently accounts for the willingness to abide some dry holes. AUTOS: Chrysler idles first 10 days of month show 40 gain over 1963 level CHRYSLER CORP.

reported its dealers sold 23,181 cars in the initial third of January for a 40 increase over the daily selling rate in the comparable 1964 period General Motors reported a 22 increase in its selling rate as sales totaled 101,238 for the period American Motors matched its 1964 pace with 8,101 sales Ford Division set a record for the period with a daily selling rate of 5,859, up 23 from the previous peak a year ago. Sales totaled 41,012. Lincoln Mercury dealers sold 7,045 cars and posted a selling rate 29 higher than a year ago. trf i 7 I AJL Drugs, Airlines Again Set Pace in Busy Market BY ROBERT SULLIVAN Tlmu Aulstint (financial Editor In the heaviest trading of the new year on the New York Stock Exchange, the majority of issues posted gains for the seventh consecutive session Wednesday. Volume climbed to 6.1 mil lion shares from 5.41 million Tuesday, It marked the larg est turnover of stock since the last day of 1964.

Investors were choosv. however, as the wide selec tion of securities in the most- active list attested. SDerrv Rand, a rarity in the list in recent months, was the leader. It advanced to 14Vi on 84,400 shares. Of the 15 top-traded issues, only one, General Motors, was down.

One was unchanged Parke. Davis. All the rest were higher. Airlines, Drugs Strong Airlines, drugs and secon dary chemical stocks attracted much investment atten tion. The air carriers were helped by a number of bro kerage house recommenda tions and by reports of sustained heavy traffic.

Drugs continued to do well in an ticipation of enactment of President Johnson's health program. Most shares closed below their best levels, however. btandard Poor's index of 500 stocks gained 0.23 to 85.84. The Dow Jones 30 in dustrials added 0.96 to 886.85. Both indexes are within easv reach of historic highs estab lished last November.

Both the and DJ util ities averages advanced to all-time ceilings for the fourth straight day. Chrysler Rises Although GM slipped back 3A to 9614, and Ford closed unchanged, Chrysler surged 19a to 611s heavy dealings. Chrysler reported that its dealers sold 40 more cars in the first 10 days of January than they did in the like period a year ago. Gold issues, which in re cent days had slipped sharp ly, leveled off, with one ex ception Homestake it dropped another Vs. American Airlines re ported its 1964 traffic set a record and the shares added 3A to 48V4.

Du Pont gained 1 point following news of a sharp gain in sales. Steep sales increase in De cember and for the last 11 months were reported by Interstate Department Stores. The stock rose SA to 30. After the close, Bache Co. said it expected to make special bid today for 000 shares of Burroughs.

The stock had closed at 2814, up but in late trading on the still-open Pacific Coast Stock Please Turn to Pg. 13, Col. 6 of UCB stock for each of the 750 shares of the Mt. Shasta bank and 18 shares of UCB for each of the 500 shares of the Ceres bank. Shareowners at the meeting weren't very curious One, a man, asked hestita- tingly for a reason why the notes would be sold.

Chairman Frank L. King said they were to provide funds for future growth at the best possible rate. A woman complained that several UCB branches she'd called had no information on the annual meeting (held downtown): King said that was inexcusable and would be corrected in the future. UCB's was' the first major California bank annual meet ing this year, and Tweter 's was the first assessment of riease Turn to Pg. 13, Col.

Thomas F. Willers, pres ident of Hooker Chemical and other American businessmen were told this during a. recent trip to the Soviet Union, Willers said. "Soviet Premier Alexsei Kosygin told us they would even consider joint ventures with U.S. companies.

They're that desperate," Willers said in an interview following a luncheon speech to a chemical trade group. In his speech to the Syn thetic Organic Chemical Manufacturers Wil lers said that "resuming normal trade "relationships" with the Soviets "can help the cause of stability and peace by ultimately integrat- ing the Soviet economy into the world economy." 1 he Russians probably could sell more to the United States than they or we rea lize) he said. Official Blessing The executive's strong pitch for improving trade with the Soviet Union coincided with a State Department report advocating a more flexible trade policy toward the Soviet bloc. The State Department report suggested that the East European countries, which" once did more business with the West than with the So viet Union, may be turning again to the West for a major share of their trade. Yugosla via and Poland already have, the report noted.

In a related development, the Soviet Union bought an estimated 11.2 million bushels of French wheat, accord-. ing to cables to American ex porters. Details are not yet available. This is a small amount compared with Rus sia's huge purchases from. Canada and the United States last winter, but it typifies efforts of other Western i.

Soviets. Soviets Confused Explaining the Soviets' intense interest in American technology, Willers said they "don't know exactly what they want, and they don't know exactly what they have to offer us." But as far as chemicals are concerned, he said, saw the rise in chemical technology in the West 20 to Please Turn to Pg. 13, Col. 1 Du Pont Sales in 1964 Up 8 to 52.7 Billion PITTSBURGH (DJ) Du i Pont sales last year rose 8 to slightly more than $2.7 billion. R.

F. Conaway, assistant treasurer, told Pittsburgh Security Analysts Wednesday. In November, H. Wallace Evans, treasurer, had predicted a 7 climb in volume for the year. Du Pont's 1963 1 volume was a record 000,000.

Conaway repeated a November forecast by Evans that total earnings last year were only a few cents less earned in 1963. The total last year included $2.06 in dividends from General Mo tors Corp. stock, 39 cents from the sale of GM stock and the balance was from operating earnings. In 1963, GM dividends added $3.21 to Du Pont's total share net. The company completed divestiture of the stock under court order this month.

5 Sales Gain Conaway also repeated an earlier forecast that Du Pont expects a sales gain of about 5 this year over 1964. He forecast a similar climb in operating earnings. The official said Du Pont's rise in operating earnings last year was held back' by several factors. Reduced sell-, ing prices for certain nylon yarns and dacron staple helped produce a decline in the company's selling price index for all pro ducts against an average of 5110 in recent prior years. I i.

s' i Balderston resigned to re turn to his position as a professor of business admin istration in the Graduate School of Business Admin istration at the University of California, at Berkeley. Balderston was appointed savings and loan commis sioner in June, 1963. He suc ceeded Preston Silbaugh in the position. "It is with deep regret that I accept Dr. Balderston's re signation," Gov.

Brown said. "He has done a tremendous job in administering a. criti cal agency of state govern ment. We shall miss his keen, analytical mind and his dedi cated service. "As chief deputy commisS' loner, Mr.

baaier nas carried heavy responsibility and is extraordinarily well prepared to assume the duties of commissioner." Sadler's and Balderston's administrative philosophies are quite similar, they both indicated In telephone interviews Wednesday. Chooses Own Aide "This means the division will be able to carry out pro grams we have been work ing on for some time," Sadler said. He and Balderston have been close friends for many years. Tne commissioner is appointed by the governor. The commissioner, in turn, chooses his chief deputy.

The rest of the positions in the 150- man agency are civil service Please Turn to Pg. 11, Col. 7 nounced higher rates on certain longer-term deposits. UCB, the fifth largest bank in the state, is 83-owned by Western Bancorporation, the nation's largest bank holding The bank's deposits at the end of 1964 amounted to $2.74 billion, up $149.2 million for the year. Shareowners at the meeting approved a proposal to issue and sell $35 million of 25-year notes.

This issue will be in addition to $35 million in capital notes sold in September, 1963. The acquisition of two smaller banks also was ap-! proved by UCB shareowners. They were the Eank of Mt. Shasta, with deposits of $4.6 million, and the Bank of Ceres, with deposits of $3.8 million. Merger agreements call for an exchange of 15 shares AEROSPACE: Ling increases holdings in L-T-V; firm sets up 3 subsidiaries JAMES J.

LING has increased substantially his holdings in Ling-Temco-Vought, Dallas financial sources said Wednesday. It also was reported the company has transferred virtually all its operating divisions to three new subsidiaries LTV Aerospace LTV Elec-trosystems, and LTV-Ling-Altec, Inc. D. Harold Byrd, Dallas financier and a director of L-T-V, confirmed he recently sola Ling his 50 interest the Alnha-Ompfra a holding company Oil Strike Reported in West Los Angeles BY JOE R. NEVAREZ Time staff Writer previously held jointly by the two men.

Alpha-Omega owns, among other things, 192,000 shares of L-T-V stock. ACQUISITIONS: 90 of Canadian Delhi Occidental Petroleuniiand is able to determine ac- Gareth W. Sadler (ffl Wirephols me ueiruicu petroleum administra tor said the new find bears out his contention that the ci ty is "sitting on an estimated 100 million barrels of undis covered oil reserves." He said he believes there is an oil pool extending from Beverly Hills to downtown Los Angeles at 14th and Broadway, where. Standard Oil Co. of California has also found oil.

BANKING other domestic clients through involvement with them on the international front. WALL STREET: Big Board, NASD to co-ordinate tests for executives TESTS required of executives of securities firms will be co-ordinated by the National Association of Securities Dealers and the New York Stock Exchange, it was announced Wednesday. Beginning this month, individuals due for supervisory positions may take the test requirements of the exchange and the NASD in a single four-hour session. The test deals with financial analysis, SEC regulations, investment companies and the association's rules of fair practice. ET CETERA: Random curiosities, facts and rumors from today's business world PROFITS PROPHETS: Scott, Fores, man Chicago publisher of books, expects sales for the year to end April 30 to rise between 11 and 12 above fiscal 1964 to about $39.

million, with earnings going up at an even better rate. In fiscal 1964, the firm earned or $1.58 per share, on sales of $35.3 million American Commercial Lines expects to report net income of about $6 million, or $3.90 per share, on estimated operating revenues of $45 million for 1964. In 1963, the barge line firm earned $5 million, or $3.29 per share, on revenues of $42.4 million. The carrier predicts additional growth this year. It plans to, acquire Terminal Transport, a trucking firm, for $12.5 million in cash.

MEN AT THE TOP: Dr. Franklin Murphy, UCLA chancellor, has been elected a director of Ford Motor Co. Herbert S. Landsman, 46, has been elected executive vice president for divisional services of Federated Department Stores, Inc. IN PASSING: American Tobacco is coming out, with a new king-sized Lucky Strike cigaret.

It will have a flavored filter (to replace some of the tobacco taste lost through filtration) U.S. electricity output last week was up 6.4 from a year earlier. Southern California Edison showed a 10.4 gain Wholesale food prices rose 0.7 this, week to a Dun Bradstreet index of $6.04 The GSA plans to sell 1.4 million pounds of surplus magnesium Anheuser-Busch this week is hosting 2,000 wholesalers in St. Louis at what it terms the largest sales convention in the firm's history American Airlines reports it set a company record last year for passenger miles 8,158,961,000 a gain of 13.2 over 1963. shares reported deposited for purchase A SPOKESMAN for Nesbitt Thomson said in Montreal Wednesday that slightly over 90 of the outstanding shares of Canadian Delhi Oil, have been deposited with Montreal Trust Co.

for purchase. Nesbitt Thomson. Montreal investment dealer, offered $10.12 f-- -11 i1 (Canadian tunas) a snare ior an me outstanding shares of Canadian Delhi, a Calgary-based oil and gas com- MacViitt Thnmsnn will sell United California Expects 4 Rate Will Hike Costs $2 Million Canadian Delhi shares to Standard Oil of Ohio. The shares will be stripped of Trans-Canada Pipe Lines, ADVERTISING: Many U.S. agencies brave maze of European commercial TV DABBLING in commercial television in Europe can be both exciting and dangerous, Charles F.

Adams, executive vice' president of MacManus, John Adams, told the Los Angeles Advertising Club, but nine out of 10 of the largest U.S. agencies' have plunged in. Despite a ter- Corp. Wednesday reported discovery of a new oil pool i in approximately 500 feet of oil-saturated sand at the corner of Pico Blvd. and Beverly Dr.

in Los Angeles near the Beverly Hills city limit. "This sand has excellent possibilities to produce oil on a commercial basis although reliable estimates of the size and a real extent of the indicated discovery cannot be made at this time," a company statement said. Arthur O. Spaulding, Los Angeles city petroleum ad ministrator; termed Occiden tal's find a "sigmficent dis covery." The company now ha3 424 acres under lease on what is believed: to be a structure. Leasing is continuing.

Based on core analysis da ta, the oil contained in this discovery well is 29 degree gravity with estimated gas- oil ratio 750 cubic feet of gas per barrel of oil, Occidental said. Deeper oil sand possibili ties on the land block have not yet been tested. Upon completion of tne company's leasing program, an application will be made to the City of Los Angeles for permission to form drilling districts. Permanent fenced and landscaped drill sites then will be installed as required by city ordinances, the company SDauldirts estimated that (it will be at least six months before Occidental can com- Iply all city regulations1 riiying notige puugc ja miumuMuu systems and national and local restrictions, it's worth the gamble for three reasons, Adams said: 1 The definite promise of profit: 2 Many agencies feel they must protect their domestic business which is rapidly moving into the Common Market; 3 There is hope of having access to BY ARELO SEDERBERG Timtt Staff Writtr Higher interest rates now paid to savers will add about $2 million, after tax, to' the costs of United California Bank this year, UCB President Clifford Tweter told about 50 shareowners at a sedate annual meeting here Wednesday. "This will be the result if interest rates "hold at their current rate and general business continues to hold he said.

"We'll have to wait for the fi rst quarter to end before wle know if the higher costs will be offset." Major California branch banks late last year announced a 4 interest rate, up from ZWc, on regular "passbook" savings, effective Jan. 1. Earlier, the banks an "McGaughey Wins Hixson Jorgensen Post EMMETT McGAUGHEY has been appointed executive 1 vice president of Hixson Jorgensen, Los Angeles advertising agency. McGaughey Joined the firm in Jan-uary, 1964, as senior vice president in charge of client services and a director. He had been executive vice 'president, Western Division, of Erwin.

Wasey, Ruth-' rauff Ryan. During his 12 years with that firm he also 'served as an executive v.p. and director of the parent Born in St. Paul, McGaughey holds a A decree from the University of Washington. He was a special agent of the F.B.I, for eight years.

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