made an actual discovery of oil. Therefore, regardless of market or transportation conditions, regardless of the selling price of oil, he drills his discovery well. Then, because the law cuts the fields into tracts so small that one tract may be almost wholly drained by wells on those surrounding, he drills more wells, regardless of whether he can dispose of his oil advantageously or at all, in order to prevent his neighbors from taking it from him. It may be that his profits would be greatly increased by leaving the oil in the ground for a few months or years; it may be that he is farsighted enough to regret the waste resulting from premature production; but the law which demands discovery and restricts his acreage prohibits his free choice and forces him to produce. Not unlikely he or one of his neighbors, in the haste with which they all must drill, lets water into the oil sand, perhaps to the ruin of the area and the loss of thousands of barrels of oil. He would have preferred to go more slowly, to study the relative location of water and oil horizons, to have the field so developed that a maximum amount of oil might be obtained, but the oil-land law does not tend to encourage prudent or careful development. He must drill, drill quickly, drill continuously.

Under such conditions and with such a law, a single expedient is inevitable: operations must be suspended as far as possible until a more adequate law can be provided. It will not do merely to urge the passage of a new law while allowing the old one to operate. By the time Congress could act the damage would have been done beyond repair. The public domain can never be repossessed and reconsolidated after it is once disposed of in small tracts. Every day under the placer law means the location of more small claims. The only solution is to suspend the operation of the placer law on all lands believed to be valuable for oil and gas.

Such are the considerations which require and justify oil withdrawals to-day. Such were some of the considerations in 1909. Then the thought of a fuel supply for the Navy was dominant—a need which is now believed to be at least partly covered by two naval reserves in California and one in Wyoming. But, as a reading of the letters of November 11, 1908 (see p. 117), and September 17, 1909 (see pp. 133, 134), will show, along with the question of naval supply was the question of ultimate public interest-the necessity for immediate action. In such an emergency strong, even severe, measures are justified. The withdrawal order of September 27, 1909, was drafted and signed. (See p. 135.)

That this was a severe measure no one will attempt to deny. Without forewarning and without precedent, it knocked the breath, for the moment, from the California oil industry. Some of the orders. promulgated since have been almost as severe, although not so widespread, in their effects. These things the officers responsible for

them realize. The geologists who recommend or prepare withdrawal orders are not ignorant or careless of the hardships which they may cause. Many of them Western men, personally familiar with the field under consideration, knowing its people, knowing the sacrifices they may have made, the risks they may have incurred, the hopes they may entertain of striking oil, these geologists regret keenly that the development of the West may by their action be in some measure retarded. Yet without hesitation or exception they recommend that the interests of the public be made paramount.

The temporary character of the withdrawals can not be too strongly emphasized. There is no thought of tying up permanently the oil deposits on the public domain. As soon as there are satisfactory laws for the development of these deposits the withdrawals should be revoked, but in the meantime it seems certain that withdrawals will continue to be made, not as permanent institutions but as temporary expedients, to meet an abnormal condition, during a period when the needs of the situation have far outrun the adequacy of the law.

HISTORY OF THE WITHDRAWALS.

The first official report of the occurrence of oil on the public domain seems to be that of January 5, 1865-a letter to the Commissioner of the General Land Office from the register and receiver at Humboldt, Cal. (See p. 59.) In reply (see p. 60) the Commissioner directed that tracts valuable for petroleum deposits be withheld from disposition unless further specific instructions to the contrary were issued. How long this suspension continued is not apparent from the data at hand, but there seems to have been nothing further of the sort until 1900. The events of that and the two succeeding years afforded a striking illustration of the inadequate protection given by the placer law to the oil prospector during the period prior to discovery. The oil placer act had been in operation about three years, the oil industry of the West was just entering upon the remarkable activity which it still maintains, and demands came from practically every new field for the withdrawal of lands from agricultural filing so that drilling might be carried on unhampered. More than 20 withdrawal orders were issued by the Land Office, covering a large area in California, Oregon, and Wyoming.

After this withdrawal fever came a reaction. The withdrawn area was large and included much agricultural land, and intending entrymen and selectors cried out for restoration. A sentiment against the withdrawals seems to have developed in the Department, and the agents sent to investigate the fields appear to have reported as nonoil land nearly every tract upon which there were no derricks. There were 3 restorations in 1902, 13 in 1903, and 12 in 1904. Then there

was a quiescent period, followed by one restoration in 1906 and six in 1907. One of the early withdrawal orders was not canceled until 1910 and another, involving several townships, was left outstanding until 1912. Both were in territory which has not proved to be oil bearing.

Meanwhile, Survey geologists working in the California fields became impressed with the need of the oil operators for protection against agricultural filings during the drilling period. Thus it happened that in 1907, within less than three months of the restoration by the Land Office of large areas because "it would appear that no good reason exists for the further suspension," some of the same lands, as well as other areas, were withdrawn by the Department on the recommendation of geologists familiar with the situation. Additional withdrawals in California were recommended by the Survey and approved by the Department in 1908 and early in 1909; a petition from an oil company resulted in a withdrawal in Oregon; and an area in northwestern Louisiana was withdrawn on recommendation of the Survey to prevent the waste of natural gas. These withdrawals, except that in Louisiana, were made for the same purpose as the earlier Land Office orders and were essentially similar in their scope, but they had somewhat more fortunate fate. They were more closely confined to prospective oil territory; they probably included less agricultural land; the number of oil operators benefited had greatly increased; large coal and phosphate withdrawals had accustomed the public to the withdrawal idea; and, perhaps most important, field examinations with a view to classification were carried on as rapidly as the funds available would permit. The lands shown by geological surveys to be nonoil were promptly restored; those offering possibilities of oil were retained in withdrawal. This was the situation in the summer of 1909.

The withdrawals up to this time, outside of Louisiana, had been aimed mainly at the "scrippers" and "oil homesteaders" who had flocked into some of the fields and filed on lands of little agricultural value in the hope either of obtaining title to valuable oil land or of forcing the oil operators to buy them out. Thus the withdrawals prohibited agricultural entry or selection, but most of them permitted mineral locations,' so that immediate extraction of the oil was promoted rather than retarded. This at first glance appeared excellent for the producer, but when production began to outrun demand the situation became serious. The Survey's oil geologists, coming in con

1 The withdrawals in Louisiana and Oregon were from all forms of location or appropriation. The withdrawal of Nov. 7, 1908, between Coalinga and Martinez, Cal. (p. 116), is recommended "from all entry" in the opening sentence and in the closing sentence refers to "a similar temporary withdrawal from agricultural entry." Whether or not this would be interpreted to prohibit mineral entry, it did not prohibit mineral location. The remaining withdrawals were in California and Wyoming and were from agricultural entry or selection only.

tact with most phases of the industry, reached the conclusion that further and more radical action was necessary to meet the exigencies of the problem, and urged that the oil fields on the public domain be withdrawn from all forms of disposition, including mineral location and entry.

The reasons which led to this conclusion are essentially those upon which rest the withdrawals of to-day, and as these have been summarized in a preceding chapter they will not be discussed here. It is only necessary to say that in a letter dated February 24, 1908 (see p. 104), the Director of the Survey urged upon the Secretary that the filing of oil claims in California be suspended, in order to insure an adequate supply of fuel oil for the Navy. No action having been taken in the meanwhile, the Director renewed his recommendation on September 17, 1909 (see p. 133), at which time he pointed out the inappropriateness of the placer law and the advisability of retaining public oil lands in Government ownership until more adequate legislation should be enacted. This recommendation led to a letter of the same date (see p. 134) and similar tenor from the Secretary to the President, and to the conversion on September 27, 1909 (see p. 135), of the outstanding withdrawals in California and Wyoming into withdrawals from all forms of disposition. Then followed another period of activity, some 13 withdrawals being made by the Department between October 1, 1909, and June 30, 1910.

But these withdrawals were a severe blow to a large number of operators; to some they were almost ruinous. An order so sweeping in its effects upon so large an industry and coming without warning, as did that of September 27, 1909, was little short of a cataclysm. The question was at once raised, Is the order valid? Many, among them lawyers of prominence, argued that it was not, and no inconsiderable number of operators acted on this assumption. Thereupon the President asked Congress to set all doubts at rest by definitely giving the Executive the authority to make such withdrawals, and Congress responded with the act of June 25, 1910 (36 Stat., 847). (See p. 48.) But, although the previous orders were at once confirmed under this new act, it was contended that the confirmation could not affect those who had initiated placer locations between the original and the confirmatory orders. They continued in the belief that the Departmental orders were ineffective, and thus forced the Government to its second step; it brought test suits against certain of these operators. Five years and more after the promulgation of the order of 1909, during which time thousands of barrels of oil had been extracted and two Federal district courts had held the order invalid, the Supreme Court of the United States rendered its decision in the Midwest case,' holding the order valid and effective. The

1 United States v. Midwest Oil Co., 236 U. S., 459, handed down Feb. 23, 1915.

decision was based, not on the President's power as Commander in Chief of the Army and Navy to preserve a naval fuel supply, nor on any power expressly delegated by Congress, but, in the language of the court, (* * * long continued practice, the acquiescence of Congress, as well as the decisions of the courts, all show that the President had the power to make the order."

As already stated, the withdrawals outstanding when the withdrawal act of June 25, 1910, was approved were at once ratified, confirmed, and continued in full force and effect by Executive orders.1 Since that time about thirty-five new withdrawals have been made, covering all public lands in which there is thought to be a reasonable prospect of finding valuable deposits of oil or gas. At the same time all lands which field examination has shown to be probably nonoil have been restored. By this process of withdrawing the more promising lands and restoring the less the withdrawals have, it is believed, come to approximate more and more closely the areas from which oil will be produced, with an increase in acreage of less than 19 per cent since July 2, 1910. The confirmatory orders of that date covered approximately 4,697,600 acres; new withdrawals have included about 3,483,300 acres; and nearly 2,593,900 acres have been restored, leaving approximately 5,587,000 acres outstanding January 15, 1916, distributed as follows:

It must not be assumed, however, that these figures represent public land actually affected by the withdrawals. Most of the orders are drawn in "blanket" form; that is, they cover the areas believed to be oil bearing without regard to ownership, and in their terms include many tracts which are in private ownership or to which valid rights have attached. Except for the comparatively small number of cases in which there may have been fraud, these lands are of course not subject to the withdrawal orders. Unfortunately, figures showing the acreages upon which the withdrawals are in reality effective are difficult to obtain. Those given below, taken from a table compiled by Mr. J. H. G. Wolf, of the Bureau of Mines, show that of the with

1 Petroleum Reserves Nos. 1 to 8, July 2, 1910, pp. 182 to 206.