Around 1935, oil was discovered approximately 13 miles NNW of Chama, NM, due east of Chromo, at what would become known as the "Gramps Oil Field". The field was owned by Lafayette "Gramps" Hughes. His company moved oil from these wells by pipeline across the Continental Divide to holding tanks and a narrow gauge loading dock at Chama. The system was largely a siphon, with no en-route pumping stations. There are reports that the pipe actually travelled in a wooden box for large sections, insulated with sawdust, to keep the oil warm and fluid enough to make the trip.
At Chama, the oil was loaded into narrow gauge UTLX tank cars for the trip to the Oriental Refinery (sometimes called the Gramps Refinery) in Alamosa, CO. The cars were then sent back light to Chama. When the field was at peak production (1100-1300 bbl/day), this would amount to a fully-loaded 11-car oil train to Cumbres Pass daily.
The operation continued until late 1964. At some point in 1964, the refinery apparently suffered a fire, and repairs/replacement on such a small facility was considered uneconomical. The refinery closed down during September of 1964, and the oil traffic over Cumbres Pass ceased.1 The loss of traffic was a significant blow to all-season operations on the narrow gauge, as the winter of 1964 was the first time the line was shut down.
Oil from the field from 1964 until production ended in the 1980s-1990s was sent by truck to Farmington, NM instead.
Oriental Refinery Notes
The Oriental Refinery in Alamosa operated from ??? until September of 1964.1
As a side note, the refinery used the boilers of two ex-D&SL 2-6-6-0s to provide steam.2
Gramps Oil Tank Cars
Gramps Oil never actually owned any of the tank cars carrying their oil over the narrow gauge. Gramps leased a number of the cars of Union Tank Car (UTLX). Numerous reports claim that Lafayette Hughes had them painted "Gramps" so that his grandchildren would know which cars belonged to their grandfather (aka the namesake "Gramps" in Gramps Oil).
1 Richardson, Robert W. "Narrow Gauge Notes." Iron Horse News Nov. 1964
2 Earl Knoob post to the Narrow Gauge Discussion Forum, 19-Jan-2003, 2115h