Arizona republican., 1916-02-28
0|L PIPE LINE COMPANIES ARE CHARGED WITH EXCLUSION 0F
 |NDEPENDEN TS FROM L|NE{

aggregated in 1913 s43, ,S57 900 the cost of transportation by pipe line, includ- ing depreciation on investment, $1O.- GA, 900: and the gross receipts which would have been obtained if tariff rates had been charged on all the oil car ried, $2S. 900. On this basis the earn ings would have been SIS, ,000, and the rate of return on the net invest ment 41.5 per cent.
 'The variation in net earnings for the five different systems would have been considerable, ranging from fourteen to 62 per cent"
 The report goes into minimum quan- tity requirements of the pipe lines, which it charges, excludes smaller con- cerns.
 Conditions made regarding the min imum quantity of oil which will be | accepted for shipment" it says, are such that the small oil producer or re- , finer is virtually precluded from using | this method of transportation. The Prairie Pipe Line company makes the minimum requirement 100000 barrels; | certain others require at least 25,000. | It is evident, therefore, that a min imum requirement of 1000 barrels is not necessary. But a minimum re- excessive.
 The really difficult problems for l pipe lines acting as common carriers | would appear to arise when the ship
 ments offered exceed the capacity of
 the line, and in that case some equita- ble rule would have to be determined
 for apportioning shipments.
 Furthermore, there is no opportunity
 to get cheaper transportation by other
 means, because the rail rates are higher
 still"
 The report concludes:
 "The conclusion is evident that lower rates and equitable shipping require
 ments by pipe line are necessary in
 order to make pipe lines common car
 riers in fact as well as in law. and that
 the prosperity and perhaps even the | existence of many small concerns are
 dependent upon reasonable and equita
 ble shipping conditions.
 Lower pipeline rates and reasonable
 pipeline shipping requirements would
 enable many small producers and re- 1 liners to transport crude oil from the
 mid continent field by pipe line who
 are now unable to do so. and would l therefore, tend to equalize competition in the sale of crude oil by increasing it in some markets where it is sl1gh
 or non-existent and by reducing it il
 others where it is eXtraordinaryily keen. While the natural disadvantagt of location of the mid-continent fielC with respect to the largest consuming markets can not be removed, the arti-
 line rates and shipping requirement! can be ilminated.
 The removal of these artificial dis advantages would tend to a greatel equality in the prices of mid-continen and Appalachian crude oil. and conse uuentlv the prices of the refined pro ducts which are made from them would tend to be more equal in differen markets of the United States. Whethe the general level of prices of refined products would be thereby reduced O. kept at lower level would depend
 chiefly upon the movement of th' prices of crude oil Such prices, under
 conditions of free competition in pur chase and sale, would be determined by supply and demand. Competition
 would be promoted. however, and mor' equitable conditions established by th' removal of these artificial disadvan tages imposed on the mid -continen l field