The Washington times., 1923-12-15
FALL IS HIT
FOR PART
IN DEAL
Montana Senator Declares His
investigation of Leases Is
Just Starting"
BY KENNETH CLARK,
international News Service.

The Federal Government has
lost approximately 3S5, 100000
barrels Of oil, with an estimated
value of about 100000, 900,
through the leasing of naval oil
reserve lands to private in
terests, Senator Walsh of Mon
tana charged today in a prelimi-
nary statement of the Senates
investigation of the leasing Of
Teapot Dome to Sinclair Oil in
terests.
Estimates From Testimony.
Walsh made his estimates as q
result of testimony before the COM
n1ittee by Harry F. Sinclair and
E. L. Doheny. of the Pan-American
Petroleum company, which OBJ
tanned the lease to naval reserve
No. 1 in Elk Hills, California.
Sinclair told the committee that
Teapot Dome was worth about
800. 0O0, 900 to him." Walsh said.
Government officials estimate the
oil capacity of Teapot Dome to be
$4,000, 900 barrels.
DOu6UH Seilu the I1A44S
reserve had a value Of about
500, 900 900, and that he expected
to get about 25O, 100000 barrels of
OIL out of the reserve.
Lays Blame to Fail.
Had the leases not been made
by ex-Secretary of Interior Fall, the
Government would have received
the money and the navy would
have had the oil for reserve pur-
poses in times of emergency"
Walsh declared.
Walsh also outlined what he
termed were the fundamental de-
velopments of the Senate's probe.
''I think the following have been
outstanding developments of the in.
Vestigation,' Walsh said:
al. 1t is singular coincidence
that Secretary Fail became associated
with both Sinclair and Doheny after
he leased the reserves to them. An
other remarkable thing is that he
got out of the Interior Department
as soon as the leases were executed.
's2. The Navy Department has a
plan to construct oil storage tanks
along the seaboards at a cost of
about sos, 000, 900, to be paid for,
not by appropriations by Congress,
but by royalties from oil taken out
Of the reserves that were leased. The
regular course would have been to
have asked Congress for the money
for this work Regardless, the work
went ahead without any kind of
knowledge on the part of Secretary
DENLY as to whether the amount OF
oil accruing to the Government
under the leases would meet the de-
mands and needs of the navy.
Navy Officials DiscIaim.
"s. Both DENLY and Assistant Sec
rotary Roosevelt admitted on the
stand that they had no intimate
knowledge that reserve No. 1, incl1d-
ing $1,000 acres, had been leased at
all to the Pan-American Petroleum
Company, or Of the considerations
upon which the lease was made.
That is to say, the conditions that
induced Secretary Fall to make the
lease to Doheny's interests.
81. The investigation also has de-
veloped that, not only Teapot Dome.
but all naval reserves have been
leased to private interests. so that
the navy has no reserve oil lands of
its own"
Just Started" He Said.
Walsh said that he had Just
started his investigation into the
leasing Of navy oil lands, and prom
tsed Startling revelations" when
the hearings are resumed. Secre-
tary Fall has been summoned to
answer charges that he failed to
pay taxes on his ranch in New
Mexico from 1912 until June, 1922,
two months after he leased Teapot
Dome to Sinclair.
Officials of the Chase Securities
Company. of New York, have been
subpoenaed by Walsh to tell why
stock Of the Mammoth Oil Com
pany, Sinclair subsidiary operat-
ing Teapot Dome, climbed so rap
idly between February, 1922, and
April, 1922, when public announce.
ment OF the lease was made by the
Interior Department"
Walsh declared Attorney General
Daugherty also may be called to
explain certain transactions regard
Ing the acquisition by the Standard
OIL Company, of California, of Sec
ton 36 in the Elk Hills reserve, one
or the richest single oil producing
fields in the United States"
Fail is expected to take the stand
In about ten days, as soon as he
recoVers from the physical break.
down that detained him in New
York and prevented his scheduled
anneaFanca Ia