The Birmingham age-herald., 1924-02-07
DEFENDS
 HIS ACTIONS IN 0ILLAND LEASE
Explanation Made On Eve Of Renewal Of
 Fight For Removal
SENATE OIL DEBATE WILL
 BREAK OUT AFRESH TODAY
Three Basic Questions Were h. volved, Says Secretary, De
 lending Lease As Legal

Z; WASHINGTON, Feb. 6. = (By the Associated Press. -- On the eve of the renewal in the senate of the democrats for his removal from the cabinet, Secretary Denby made public tonight an extended statement ex- plaining and defending his course in dissenting to the lease of the naval oil reserves.
 Asserting that there are involved three basic questions, the naval secre- tary answered them all in the affirma- tive; that the transfer of administra- ton from his department to another department was legal; that the leases themselves were legal and carried out the expressed will of congress :, that they were beneficial to the govern ment, preventing the further loss of millions of dollars worth of oil, and greatly increasing the power of the navy to defend the country.
 With the senate and it's oil commit. tee both in recess, MT. Denby's state nent was the only concrete develop ment of the day in the oil situation. Debate in the senate will break out afresh tomorrow and the committee will get back to its hearings Friday. End Not In Sight
 With new leads developing in ap- parently intending succession, the end of the senate inquiry seems to be no- where in sight. Many witnesses, prom inent in political and business life, are yet to be examined, and there is no telling how many others will be called after expert accountants have gone through the books of stock brokerage firms, banks and consciousness asso- citation in search of transactions in any way related to the oil leases. s- After the senate has renewed the au- thority of the comimttee to meet, one of the objections raised by Albert B. Fall, central figure in the oil muddle, in his refusal to testify, it win plunge into the fight over the resolution by Democratic Leader Robinson calling for Mir. sDenby's resignation.
 The navy secretary made no men, ton of this resolution in his state ment tonight, which was in the form of telegram to Roy D. Chapin, oi Detroit, in reply to the message oi confidence received some days ago iron 225 citizens of Michigan. s-ss 2 Stating that he had received hun gEed3 of lstksrs and telegrams fran
 iichigan g;3a all parts Of fbe uniol 3ir. Denby fieciared th1t asuch a dem 0nstration 5f faith requires that I shall give you the reasons why that faith is not misplaced
 Reserve Being Drained''
 When came into office," his mes. sage continued, "I was very shortly convinced that the oil reserve lands which had been set aside by congress for the benefit of the United States navy were being drained by privately owned wells adjoining those reserves That they were being drained is undis- puted. @
 , Congress- f under date of June 4, 1920, gave the following powers to the secretary of the navy:
 That the secretary of the navy is directed to take possession of all prop critics within the naval petroleum re- serves as are or may become subject to the control and use by the United States for naval purposes: To con serve, develop, use and operate the same in his discretion, directly or by contract, lease or. otherwise, and to use, store, exchange or sell the oil and gas products thereof, and those from all royalty oil from lands in the naval reserves for the benefit of the United States
 ' Three Courses Open
 Under these powers the secretary of the navy was charged with the duty of protecting the oil, thus confined to his care. In carrying out the will of congress, I had three courses open to me: "A
 "(D To do nothing and guard what would have been ultimately an empty shell because the oil would have been drained away from it.
 "(2) To endeavor to create the ma chinery for handling the situation un- der the navy department by govern mental drilling; etc., or
 "(3) To lease the right to drill under proper conditions to private en- terprise. In the execution of this last course I had two alternatives, one to lease the drilling privilege and have paid into the treasury the value of the royalty oil belonging to the navy under such leasing contract or to retain and preserve the oil above the surface since it could not be preserved below for the use and benefit of the United States.