How to Pay for College with Oil Money

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Xavier King was more or less resigned to making light bulbs or paper bags when he graduates from high school next year. Not now. "I'm going to college!" exclaims an exuberant King. A sudden windfall will make him the first in his family to attend college. "The world is looking a little brighter," King beams. "I can see myself being somebody."

King and scores of his classmates for whom college was financially improbable if not impossible had their horizons raised in a span of seconds last month when Murphy Oil Co., which is based in King's home town of El Dorado, Arkansas, changed the landscape of their future. "The El Dorado Promise," as the company calls it, promises each of the town's high school graduates annual grants of up to $6,000 (the amount is calibrated according to their length of residency in the city) for as many as five years of post-secondary education in institutions anywhere in the country. Recipients need only be accepted by an accredited two- or four-year college and maintain a "C" average.

"In my wildest dreams I cannot imagine what the impact will be," says Larry Walter, principal of El Dorado High School. If its 320 seniors include some scions of old oil money, there are also "kids who simply could not afford to go to college, and others who were limited in their choices" because of the expense involved. For example, there is one gifted young woman whose family's resources could not accommodate her dream of Notre Dame — until now. "Another six thousand dollars a year — that makes it possible," Walter says.

Murphy, a $9 billion exploration and refining company, has remained in El Dorado (pop. 22,000) even though the south Arkansas oil fields were largely pumped dry decades ago; the company's 2006 revenues of $14 billion and after-tax earnings of $600 million derive from its wells in Africa, Asia, the North Sea and Canada, as well as the Gulf of Mexico. That it has prospered as El Dorado struggled spurred Murphy to action, says chairman and CEO Claiborne Deming. "This not a booming metropolis by any stretch," Deming notes, alluding to the toll that lumber imports have taken on the area's timber economy and that job exports have squeezed from its manufacturing sector. In pledging $50 million over the next five years for the El Dorado Promise, the company not only can "give back" to the community but rebuild its shallow talent pool — a "wonderful confluence" of interests, Deming says. "Surprise, joy gratitude — the reaction in El Dorado has been heartwarming," Deming adds. "We're still seeing it."

"I could see myself in some sawmill," says Mario Navarrete, 18, whose two older brothers labor as sheet metal and chemical workers, respectively. Two decades after immigrating from the Mexico City suburb of Michoacan, Javier Navarrete is still stretching his logging company wages to provide for his wife and the four children, including Mario, who remain at home. College, he told his progeny, was too much of a stretch. "Sorry, but there's no money," Mario remembers his father saying. He also remembers his father's amazement when told that, yes, there was money. "He didn't cry. I wanted to but I held it back," Mario says.

"There is college money available already but only to an extent," says longtime El Dorado High counselor Becky Ward. "Students may not be where they need to be, either academically for a scholarship or financially for an aid package. A lot of them are caught in the middle. We've had bright youngsters with enormous potential who had no option but to go to work. I don't think some people understand that."

Tracy Owens understands. Her plan for a corporate finance career was thwarted 13 years ago when her personal finances made it impossible for her to enroll at either New York University or Howard University in Washington, both of which had accepted her. "It hurt," she acknowledges. "I'm not a genius, but I had the potential for an Ivy League education." She had to settle for an associate degree at the local community college. "If I'd had the Murphy program, no telling where I would be," whispers Owens, who works an evening shift at the local Wal-Mart to help support her three children. "At least it will be there for them."