Lago Petroleum Corporation was an oil production company established by Americans in 1923 that exploited the oilfields in Lake Maracaibo.
Edward L. Doheny, who owned the Pan American Petroleum and Transport Co., controlled the Barco concession in Colombia through a subsidiary.
Coronil and Doheney's staff, the Lago Petroleum Co. was formed by Preston McGoodwin, Joshua S. Cosden and Payne Whitney Associates, and registered in Delaware on 12 April 1923.
Gulf Oil had acquired the Creole Syndicate's leases in the strip of shallow water 1.5 kilometres (0.93 mi) wide along the lake shore.
Lago[a] owned about 8,000 square miles (21,000 km2) of land in Lake Maracaibo, and produced about 30,000 barrels of crude oil per day.
Since the three competing companies were draining a common reservoir, each had an interest in extracting oil as quickly as possible, although a more deliberate pace would have given greater total output.
At times, hastily built wells collapsed, oil gushed into the lake and caught fire, burning rigs and equipment.