Evening star., 1926-12-06


court.
Mr.. Roberts also brought to light
for the first time in the trial a state
ment made bv Secretary Fall of the
Interior Department to Secretary
DENLY late in 1921, urging immediate
action on leasing Of the oil reserves.
Quoting the stenographic report Of a
| meeting Of the Navy Council which
had before it, under date of November
90, 1921, an estimate of cost of con-
strucing the storage tanks, submitted
bv Doheny. Mr.. Roberts read that tho
Navy Secretary said: Secretary Fall
told me If we do not tackle it now
we would not get any three months
from now. They are getting 900
barrels day from the wells now"
The witness did not recall Denbv
have made that statement, but he vol
, unteered the explanation that "it
wasn't true. so far as the reserve oil
is concerned"
Attendance Unusually Large.
An unusually large attendance was
in court this morning when the ses-
sion recOnvened, In anticipation of
Secretary Wilbur being called as a
witness Spectators were doomed to
disappointment, however, as it was
concluded not to permit any interup-
ton of Capt. Robison's cross-exam-
ination.
Mr.. Doheny appeared early. his left
arm in a sling. The Oil defendant
seemed to be in a weak condition,
but said his arm was feeling a little
better.
In the hope OF getting through with
the cross-examination Of Capt. Robi-
son by Government counsel before the
session ends today, Attorney Hogan,
for the defense. prepared to make
short work of his own examintion Of
the former chief Of naval engineers
Taking up examination where he
left off last Saturday, Hogan asked
the witness If he did not convey to
Secretary Fall the information that
the December IL, 1922, contract was
satisfactory.
Capt. Robson said he took the final
draft Of the contract to Secretary
Denby-Mr Wilbur's predecessor
for him to sign. This the Secretary
did. in the presence Of Robson. the
elder Doheny and J. J. Cotter. in the
private office Of the Secretary.
Questioned by DENLY.
Asked to relate what occurred, Robi-
the contract included the changes he
had incorporated in the original form.
II assured him that 1t did. and
without completely reading 1t he
signed it," Robson said. The naval
witness replied in answer to questions
,, that DENLY had asked if any addi-
tional clauses had been put in the
contract and was informed that such
was not the case.
II introduced him to Mr.. Doheny,
| and Mr.. Cotter and Secretary DENLY
lAna ot iYtr
he said. "One or the other, I don't
know which, said that it was unfortu-
nate that they had not met before" :"
Asked to relate the conversation that
took place, Robson said:
THE Secretary said, Well. Mr.. Do
heny, you've got a fine piece of prop
erty of ours turned over to you.
You've got big job to do To this
Doheny replied, Yes, we've got big
job on our hands, and I hope we've
got a fine piece Of property"
After completion and signing of
the contract, Robson said, the super
vision over the Pearl Harbor work
was turned over to the Bureau of
Yards and Docks. So far as he knew
the Interior Department had nothing
to do with it.
The question Of oil drainage in Re-
serve No. was brought up, and Capt.
Robson said he had discussed this
matter with DENLY during the nego-
tiations. He said he had advised
DENLY that immediate development
was greatly to the Navy's interest to
prevent further drainage.
Discussed With DENLY.
II advised him that the men who
got the first well dug got the most
OIL" he said. 1T was to the Navy's
interest to have on the spot a COM
petent oil organization whose interest
in getting the whole of the Govern.
ment'S share Of oil was the same as
our own. 1 told him it would be like
having a competent watchdog always
on the job" he said.
All this matter was discussed with
DENLY, he said, before the Secretary
agreed to incorporate in the December
contract the whole of the No. l Re-
serve.
Robson testified that he was anx-
ious to have the Navy benefit from the
sale of gas from the reserves, all such
sales heretofore having been put into
the Treasury to the credit Of the Gov
ernment miscellaneous fund. He said
he suggested this to DR.. II. Foster
Balm, chief of the Bureau of Mines,
and after an investigation on the lat
ter's part, this purpose was accom-
plished The gas was turned over to
the Pan-American Co. and credited to
Pearl Harbor.
Mr.. Hogan then directed eXamina-
ton of the witness to bring out what
the defense contends is the great value
of the Pearl Harbor contract and
leases to the Government.
Robson said that the Navy at first
objected to the Sl-a-barrel rate
quoted for oil and he was told by
Mr. Cotter that the Pan-American
Company would reconsider. Finally
the Navy secured price of 80 cents
a barrel for the first allotment
1900, 900 barrels of oil stored at Pearl
Harbor. The price of 80 cents was
in addition to the Pacific carrying
the best offer that the Navy had
obtained from other sources was
81 q barrel.
Points Out Other Benefits.
The contract OF December II in.
cluded, besides completion Of the
oil storage tanks at Pearl Harbor,
other provisions of great benefit to
the Navy, the witness testified. One
provision was for further construc-
ton Of fuel oil storage facilities on
future royalties, if they should come.
The contract gave the Navy the
equivalent to a bonus, he said. by
providing valuable considerations
such as maintaining 100000 barrels
OF oil in continuous storage at At
lantic Coast points, and another
clause for 100000 barrels in storage
on the Pacific Coast.
He cited as another benefit to the
Navy the fact that the contract
awarded the department the right to
purchase for Is years any petroleum
products at 10 per cent below the
market value. Since the Navy buys
from ten to fifteen million dollars