Evening star., 1907-11-09
LEASE OF IRON LAND
Completion of a Remarkable
Business Transaction.
JAMES J. HILLS PURCHASE
Perpetual Income for the Great
Northern Assured.
PROPERTY HELD IN TRUST
President Roosevelt's Policy Praised
by a Historian-John Shelton,
the Cobbler, in Congress.
PROPERTY HELD IN TRUST
BY WILLIAM f. CURTIS.
Special Correspondence Of The Star and the
Chicago Record Herald


Special Correspondence Of The Star and the
Chicago Record Herald
NEW YORK, November 6, 1907.
The lease of ore lands on the Mesaba iron
range in Minnesota by the Great North
ern railroad to the United States Steel
Corporation. has been signed. sealed and
delivered, and one of the most remarkable
business transactions known to history
has been completed. The details of this
lease were related in a letter from Duluth
in September, and, in short, the facts are
these: Mr.. James J. Hill, president Of the
Great Northern railway. through Mr.. ID.
M. Philbin, general superintendent of the
Lake Superior division of that line, pur-
chased for 81, 100000 about % 900 acres of
lands eleved to contain anywhere from
500 100000 to 1000, Goo 900 tons of iron ore
and a logging railroad. The railroad was
Immediately turned over to the Great
Northern Company, but Mr.. Hill retained
control personally of the lands until they
had been thoroughly explored and their
enormous value fully demonstrated. He
might have kept them fer his own indi-
vidual profit. but decided to give them to
the stockholders of the Great Northern
railroad at precisely the price that he
paid for them before their value was
demonstrated.
AS the Great Northern railroad Is not
allowed by its charter to 20 mining
business Mr.. Hill leased these ore beds to
the steel trust On a royalty basis, the lat
ter company agreeing to pay 10
cents ton for every ton of ore taken out
of the ground to begin with; the royalty
Increases at the rate Of 2k cents a ton
annually until it reaches 81 a ton. where
1t remains until the deposit Is exhausted.
This lease secures a perpetual income
for the stockholders Of the Great North
ern railway which will be not less than
one million dollars year under any cir
cumstances, and may amount to eight ten
or twelve millions a year, according to
the tonnage of ore that Is mined by the
steel corporation. The amount In the beds
has been approximately determined The
engineers, by boring holes in the ground
breadth and thickness. and samples taken
at various places show the percentage of
pure iron. The estimates simply fab
ulous; they are almost Incredible, and the
stockholders of the Great Northern rail-
| road will receive in annual installments at
least SaO0oO0,H0 if not double that
amount for which they have paid prac-
tcally nothing.
AS the Great Northern railway is not
authorized by its charter to carry on such
a business Mr. Hill organized what is
known as the Lake Superio., Company to
act as trustee-a limited copartnership
organized under the laws of Michigan.
with a nominal capital of 800, ,OoO, and
only three stockholders, consisting of Mr.
ftl!l himself, who owns $4,000 of the
stock: Louis w. Hill his son. who owns
$4,000 and Robert l. Harrington. general
counsel of the Great Northern. who owns
the remaining s10,G9O of the stock. Mr..
Hlll is president of the company. his son
is secretary, and Mr.. harrington is treas
urer