Tulsa daily world. [volume] (Tulsa, Indian Territory [Okla.]) 1905-1919, 1917-06-28
CBy OMAR X. BENEDICTD

WASHINGTON, June 27.-One OF
the most important hearings ever held
in Washington affecting the oil in-
dustry of Oklahoma, was the one held
this morning before Edgar c. Bradley,
assistant to the secretary of the in
terror department.
The main question involved was tno
finding of the royalty to he paid to
lessons In department leases - the
controversy out of which the hearing
grew because the interior department
demanded that producers pay to the
Indian wards the difference in royalty
of the posted price Of crude for fosr
days. beginning on December 20, at
which time-the Sinclair Oil & Gas Co.
posted a price 10 cents in advance of
the posted price of the Prairie. Gulf
Il Texas pipe lines.
Demand That Order BE Rcscindcd.
The producers demand that this or
der be rescinded. Their contention,
is that II they pay the advance now,
that they would establish n precedent
which would place them at the mercy
OF any company owning small p.po
line. who would post a price, whether
their line was adequate to take the
oil or not.
II was brought out at the hearing
that at the time the Sinclair ,vri-
pany posted a 10-cent advance they
were running only about 5000 bar
rels of oil other than their own pro-
duction daily. and that the fact was
also brought out by w. B. Fitzpatrick
of the Prairie that at the time the SIN
ct n do
company was selling several thousand
barrels of oil daily to the Prairie pipe
line at at 10 cents less than the SIN
clairs posted price. Mr.. Fitzpatrick
contended that the price of royalty
should be fixed on the posted price of
the big pipe line companies, which
dominated the field, and which have
lines to all parts Of the field. and that
the producers should not be forced
TO pay additional royalty on account
of the posted price OF a pipe line COM
pany that could not take the oil, ana
which could not get ready to take
the oil inside OF six months.
ID. +. Connolly Testifics.
This was the position taken also by
d. +. Connolly of the Wolverine com
pany. who stated that the Sinclair line
din OF come within 15 miels of his
property. and consequently could not
take MS oil.
"If the Sinclair company had lines
ramifying the entire field, and were
able to buy and take oil. it would be
a different proposition" said Mr. con-
molly. But they have lines to only
n very small portion Of the field and
could not possibly run the oiLS
Mr.. Connolly also stated that In his
opinion the Sinclair company posted
the advance In order to stimulate a
tal
had on at that time in New York.
Henry McGraw of the Gypsy Oil
company brought out the point that
the three large purchasing companies,
the Prairie, the Gulf and the Texas,
under the laws OF Oklahoma govern
ing pipe line companies. are common
purchasers Of oil, and are obliged 70
pacity will admit. Otherwise, they
must prorate among the producers
the amount OF oil taken. On the
other hand. the Cudahy and Milliken
lines, now owned by Sinclair. have
been exempted from the operation OF
the Oklahoma law. and even tho
producers had done the vain thing OF
rendering the Sinclair company tneir
oil during the days In question, SIM
clair was not obliged to take n barrel
Of oil, and did not take n barrel.
NsuNS lCbu- O0G HpSuCiNs
H. f.. West OF Independence, Kan,
made very concrete statement.
which seemed to impress the secre
tary very much. He said he had a
lease In 1904, and made a contract
with the Cosden refinery to sell and
his oil at a premium of 10 cents
soon the production out-grew the re-
finery." said Mr.. West, land the Prai-
rie built n line to my lease, and took
half my oil and Cosden the other half.
"Cosden paid 10 cents premium and
I settled with the Indian wards on
one-eighth royalty basis on both
prices. You can imagine my Won
derment then. after I had given the
Indian the benefit OF 10 cents pre-
MUM for ten years. to get n notice
from the department demanding that
/ pay four days royalty on the Sim
clair posted price. when II would have
been impossible for Sinclair to have
taken my oil In less than six months" :"
While the hearing was held before
Assistant Secretary Bradley, Commits
sioner Cato Sells and Attorneys Mer-