, 1922-05-04

department under the act o. congress
OF June 4, 1920. whereby the navy de-
partment was given the right to take
possession OF all property within naval
petroleum reserves. to conserve h
same by contrait. lease or otherwise.
and to use. store and exchange or sell
the oil and a products thereof for
the benefit u the United States
Acting nds this specific authority,
granted by act Of congress. the inte-
rior n navy departments entered
into a contract providing for the con-
~struction of a one thousand mile pipe
line from Wyoming Z connect up with
trunk lines in the east; for the immedi-
ate drilling OF 20 wells in designated
portions OF the Teapot ava reserve
and the continuance OF Development in
a diligent and businessIike manne
for the exchange OF government oils in
Teapot dome at m-id-contineut prices:
for storage tanks. fuel oil and lubri-
cants without ash outlay to the gov
eminent; for the construction of such
tankage and delivery OF such oil at
! points designated by the government
from the Gulf OF Mexico TO the colst
OF Maine; for the payment Of royalties
to the government which are in II
cess OF the average oil royalty and
more than fair TO the government for
the right to sell its royalty oil for
cash upon the basis OF mid-continent
quotations; for the preference right
to transport the Salt Creek royalty oils
through the pipelines; for the main
tenance OF the pipeline as a common
carrier. and for the assumption by the
lessee OF an litigation arising out OF
outstanding olslfas OF every character
against the govencrient concerning
lands embraced in the Wyoming naval
reserve
Tit great oil producing states OF
Kansas, Oklahoma, Arkansas. Texas.
Louisiana and other have trunk pipe
lines which are connected with the
| markets OF the world. These states
have become large oil producing CEN
ters by reason OF the fact that they
have an outlet for their surplus oil
resources was followed by Increased ac-
uvity in many other lines OF indus
try. Prosperity was the result. The
lack OF a trunk pipeline from Wyo-
ming has resulted in u depression in
the oil industry here. causing a loss
to the reclamation servico. the state
and its taxpayers. The building OF
4 AAh pAHt AlAAls Is AtlAAAta hg AlAn toh
tract, will place Wyoming on an in.
dustrial par with the other large oil
producing states OF the MO
Tho railroads cannot compete with
trunk pipelines for the transportation
OF crude petroleum The refineries OF
Wyoming supply all markets tributary
thereto Transportation rates for pro
ducts OF Wyoming refineries to nom
l frfhUNfawv RnlnNa y 90 a&RCaUxFa ne 30
fprohibit active competition. A fair
price can be obtained for Wyoming
surplus oil production only by trunk
pipeline transportation to eastern
markets.
1t is true hat many interests in
Wyoming obtained certain privileges
and benefits in Salt Creek under tho
terms OF the oil leasing act. Demands
for like privileges In Teapot dome have
been denied. The larger price for
Wyoming crude oil made possible by
this contract. the increase in discov-
cry and development OF new oil fields,
the greater return from state royalty
oils. the Increased funds for the recla-
nation service and for the school and
highways. the increase in taxable prop.
e<ty as well as the development result
ant from increased wealth in the state
AN tend TO build up "A greater Wyo-
ming.
In view OF the proven facts and tho
favorable terms of the contract en-
tered into under the provisions OF q
specific act of which made
It the duty OF the government TO take
action in this matter, the national ad-
m~inistrntion is to be commended upon
its foresight and business Judgment.