The Washington times., 1922-08-18
FALL ACCUSED OF GIVING SINCLAIR MILLIONS

inee" need not build the pipe line
until II has developed 10000 bar
rels Of production daily In Teapot.
II must drill twenty wells, then for
each Of the twenty producing over
100 barrels, II must drill two more
wells, and for each of the second
series producingS-f00 barrels, II
shall drill two wells. AS 90 per
cent Of all Salt Creek wells pro.
duce less than 100 barrels daily, II
Is readily estimated the three series
will not produce 10000 barrels un-
less the Sinclair company wishes
them to do 30. This Is true be.
cause the twenty wells are evenly
located over the entire Teapot
structure. and Sinclair may drill
the second and third series werever
he pleases. He may even stop In
Falls commercial ten-barrel Shan
non sand,
THE POINT is THAT THE SIN,
CLAIR-STANDARD PEOPLE MAY
BUILD OR NOT BUILD A PIPE
LINE, AND MAY HOLD THE
RIGHT TO BUILD A PIPE LINE
AS A CLUB OVER ANY lINDE.
PENDENT EFFORT TO FINANCE
A LINE. That IL the purpose OF
the novel twenty.well. three series
provision. -,t
Secretary Fall says one reason
for granting the lease was to re-
lieve the over-production now ex'
listing in :. Salt Creek. But the
lease declared the line need not
exceed $4,000 barrels daily capacity.
The preference given Salt Greek
royalty plus Tapot oil will be prac.
tically double the required capacity.
Plan New Corporation.
To-Day the Standard and Sinclair
interests have contracted Or are
building steel storage at Casper
and Salt Creek for over 10000. 900
barrels Of crude. Meantime both
the Mammoth Oil Company. on Tea,
pot, and Midwest Refining Company
are working night and day drilling
almost a hundred new wells. THUS
THERE IS EVIDENT A DELHI
ERATE plan in action to increase
the over production. With II the
price Of crude oil is going down,
dropping from $40 to 70 cents
within the past few weeks.
When this immense storage IL
filled with cheap oil, the Mammoth
Oil Company-by direction Of Sin
clair and its Standard associates
will secretly create a corporation
to build the pipe line.
"This nominee" will at once &C
cept transportation orders from the
Midwest Refining Company and
the Sinclair Oil Purchasing Com
pany to carry enough crude to keer
its line full indefinitely. The pipe
line will be a common carrier,
loaded with previous orders" and
the Independent producers and the
Standard Producing Companies (whc
are all mixers for the refinery com
panies) will be worse off than they
are today. They must then sell stc
the Midwest Refining Company In
a market overloaded with some 10.
000, 900 barrels I'm crude in locaI
storage, the Sinclair Oil Purchasing
Company and Sinclair Pipe Line
Company (owned 80 per cent or
over by the Standard of Indiang
and the Prairie Pipe Line Com
pany and Prairie OIL and Gas Com
pany, al. Standard. already control
the mid continent situation through
previous orders" for pipe line
space.
Where Royalties Go.
The Wall Street Journal. June
IS. writing editorially on the Sin
clair properties. says the nominee
to build the Teapot Mid Continent
pipe line is to be owned by the
Standard Of Indiana and the Sin,
clair Consolidated. each putting up
$500, ,000-snd' that the Standard
had recently acquired half inter,
est in Sinclair Company. This
identity Of interest is confirmed by
the Federal Trade Commission In a
recent report. and the commission
vtry frankly says that the Teapot
lease has strengthened the Stand.
ard monopoly Of crude oil and gas.
oline throughout the West.
Under the Salt Creek leases and
the wild cat" leases 80 per cent
OF the total royalties go to the
maintenance of public schools
building of public roads, and build.
ing of national reclamation works
in the Western States. The Sin.
clair royalties-such as they are
do not contribute q dollar, and will
not contribute a dollar. to, any
school, road or reclamation OF
desert land in the West. The small
royalties will be paid to Sinclair
for building steel tanks to store
the Mexican crude he expects to
bring In free of duty and sell to
the United States navy, or to store
residium fuel when Mexican 10 not
up to specifications.
In Salt Greek there were con,
flicting mining claimants to prac
tically every quarter section. All
these parties were accorded hear
ings and trials before the land de
partment, after the hearings deci
sions were rendered and the lands
Except the forty.one tracts above
were awarded to the claimants
showing the best right On Teapot
Secretary Fail gave the lease tc
Sinclair by secret negotiations, and
then the Government sent out arm
ed marines and dispossessed the
mining claimants who were in pos
session under the same titles upon
which leases were awarded Stand
ard companies in Salt Creek.
Governor Flayed Lease.
The foregoing are some Of the NOR,
striking differences between Sal,