I was very much interested this morning to hear Senator Vandenberg say that it was a matter of administration. I think it is a matter of administration to take all of the rules off at the present moment. It reminds me a good deal of having a boatload of people at sea with their canteens half empty, and to undertake to solve it by saying that there will be no further rationing or restriction.

I sympathize with those gentlemen who object to the way the matter has been handled under the O. P. C., to this extent, that if it is a problem of administration and if we have done a bad job, the solution is to fire us and get somebody that can do the job properly. We are simply doing the best we can. But I should hate, as an American, to see rationing and control of materials in their present scarcity abandoned at this particular_juncture.

Senator LEE. The adoption of the Lucas amendment would be to that extent abandoning the rationing of oil supplies?

Mr. DE GOLYER. That is my understanding; yes, sir.

Senator LEE. The rationing of oil supplies was the original reason for the regulation, was it not?

Mr. DE GOLYER. Yes, sir. The oil industry did not like to have supplies rationed, and we did not like to ration them; but it seems to me that the position of Illinois in our whole national picture has been considerably exaggerated. There are about 300,000,000 to 400,000,000 barrels of reserves, out of national reserves, correspondingly, of 20,000,000,000 barrels. The oil from Illinois is extremely important and we would like to get every barrel of it that we can market on the eastern coast. But we cannot depend on Illinois.

Senator LEE. What would be the result of the passage of the Lucas amendment on the other oil fields? Would they immediately increase production also? What would be the result if they did?

Mr. DE GOLYER. They would increase their drilling. Whether they would increase their production or not I cannot say. As far as I can see, if the Lucas amendment were passed, we would have a short life and a merry one in the oil industry, for about 3 or 4 or 5 months, and then we would be entirely out of supplies.

We have problems that come up, like the one that Mr. Knowlton mentioned this morning, in California. A great deal of this oil is needed on the Pacific coast, and the sole source of fuel there is California. There are no other oil fields tributary to it. We have got to have material out there to get out more oil. Before this thing is over we will probably shut down some wells in Texas in order to get the pumping equipment for heavy oil wells in Illinois so as to supply the Navy and the national defense industries.

Senator LEE. As to the barge canal, do you have any opinion, representing the Oil Coordinator's office, for or against, helpful or damaging to the proposal?

Mr. DE GOLYER. No, sir; I am not informed on the transportation methods. But as far as the barge canal is concerned, it seems to me that it could make a contribution. But that is strictly a personal view. I think we need all of the contributions that we can get.

Senator LEE. Including a pipe line across Florida to take care of the situation before the canal could be completed?

Mr. DE GOLYER. Again it is a personal opinion, but I should say

"yes."

Senator LEE. That is all. Thank you.

Senator CARAWAY. We have three more witnesses, and we want to conclude this afternoon if possible. So I will call on Mr. Davis.

Mr. SWANN. Madame Chairman, Mr. Davis is not here. Mr. Becker was to appear in his stead, but he will not appear. I would like, however, to have about 3 minutes to answer one question that was raised here, and I think it will save considerable time.

Senator CARAWAY. Very well. You may proceed.

ADDITIONAL STATEMENT OF ALLAN K. SWANN, EVANSVILLE, ILL.

Mr. SWANN. Senator Vandenberg seemed impressed with Mr. Knowlton's statement that he thought 90 percent of the independent operators in the Illinois field were in sympathy with the O. P. C. orders. It happens that I know practically all of the independent operators in that area, and represent many of them, and have talked to far more than a majority of them, and almost without exception they are frankly almost unanimous in their disapproval of the order that is in force in the State of Illinois. There are only a few who are satisfied, and they are men who are closely associated with major oil companies. I know that, because they have individually and collectively told me so in emphatic words.

A point that Senator Lee have brought up is the question of transportation and how the transportation from Illinois would affect the national picture.

There are now 99,000,000 barrels of gasoline in storage in the United States which cannot be transported to the eastern coast because of lack of transportation facilities. Oil from Illinois can reach the eastern coast in about 40 percent of the time that would be taken from any of the other Southwestern producing States.

The Office of Transportation and Mr. Davies both stated to me that Illinois' decline was because of the transportation system, because of the fact that it takes two and a half times as long to transport a tank car from the Southwest as it does from the State of Illinois.

Mr. DeGolyer has stated that he knows of no method by which the shortage can be met, short of the program of pipe-line transportation which they seek to build and which cannot be completed under 6 months to 3 years, depending upon the characteristics.

We simply say that, regardless of the over-all picture, over a period of years we can in Illinois, by drilling wells, produce an immediate quantity of oil for the eastern seaboard which can be transported from Illinois and which cannot be transported from any other

area.

Senator CLARK of Missouri. The last witness stated that to step up the production of the Illinois field would simply be a temporary expedient.

Mr. SWANN. That is what we are suggesting. I am not suggesting what will happen 5 or 10 years from now, but I am suggesting that because the people in the East are likely to freeze this winter, this is the time to get the oil to them.

In order that the schedule may not be complicated, I have Senator Lucas' permission to suggest a further simplification of this schedule

by providing for one well to each 10 acres of surface area as to sand formations, that may be drilled in Illinois or other areas. Also providing for one well to each 20 acres of surface area as to limestone formations.

That brings it down to a simple basis, and I wish to submit the suggested change which Senator Lucas has authorized me to say he has no objection to.

My whole statement is that we are not looking at the over-all picture; we are not looking at the future picture, but we are looking to see what can be done between now and the middle of next winter. We are not suggesting an orgy of drilling on strips and small tracts. We ask for one well to each 10 acres of surface area in sand formations and one well to each 20 acres of surface area in limestone formations. It seems to me that that is reasonable and sensible and fair. I do not care about the over-all picture 5 years from now; I am suggesting that the next 9 months will be the critical period. (The amendment referred to and submitted by the witness is as follows:)

(I) One well to each 10 acres of surface area as to sand formations; (II) One well to each 20 acres of surface area as to limestone formations. ADDITIONAL STATEMENT OF ALDACE F. WALKER, VICE PRESIDENT, TRANS-AMERICAN PIPE LINE CORPORATION

Mr. WALKER. Madame Chairman, I would like to take a moment to make a supplementary statement.

This morning Lieutenant Colonel Llewellyn introduced a letter from the Secretary of War in which the War Department objected to the pipe line that is proposed from Tinsley through to Savannah and Charleston. That objection was based upon the shortage of steel, with which we are all familiar. The date of the letter is June 29. The Chief of Engineers, General Reybold, testified on June 30. There was absolutely nothing in his testimony to combat the utterance of the Secretary of War. I have read this letter and I have made a quick check to New York to the National Tube Co., IngersollRand, Worthington Pump Co., and there is a discrepancy in this letter of 26,000 tons of steel. I just wished to call that to your attention. Mr. Shinkle is going to submit a supplementary statement of our understanding, plus the understanding of the J. G. White Co., as to the correct steel figures. So I wish that you would hold this letter in temporary abeyance.

Thank you.

Senator CARAWAY. We will hear next from Mr. Rene F. Clerc.

STATEMENT OF RENE F. CLERC, WASHINGTON REPRESENTATIVE, BOARD OF COMMISSIONERS OF THE PORT OF NEW ORLEANS, WASHINGTON, D. C.

Mr. CLERC. My name is Rene F. Clerc, representing the Board of Commissioners of the Port of New Orleans, an agency of the State of Louisiana. I shall not consume much of the committee's time, because hearings have been held in the House and the subject has been handled here by Mr. Miller and Judge Mansfield and other gentlemen who are familiar with the whole subject.

The State of Louisiana and the port of New Orleans are very much in favor of the improvement of the inland waterways from the Mexican border through to Port Inglis and then across Florida. Part of the route from Corpus Christi to Port St. Joe or St. Marks, Fla., was already authorized and completed and doing a wonderful performance.

As you leave Corpus Christi coming to New Orleans, on the western section of the Intracoastal Waterway, on a 9-by-100-foot waterway, you come to the Mississippi and then go down 6 miles and cross over into the big lock owned by the State of Louisiana, for at least 5 miles; then into Lake Pontchartrain, and this brings you finally to Mississippi Sound and affords you communication with the Florida coast as well as the States of Mississippi and Alabama and up the Warrior River as far as Birmingham, Ala.

That is performing now, and we are asking for an enlargement. This committee has already approved, in an act that had been vetoed by the President a few years ago, an enlargement, and we are now renewing that application.

The Chief of Engineers, by a letter addressed to the committees of the House and Senate, under date of April 27, 1942, made a full report as to the section from New Orleans to Mobile. I am not going to touch on that particularly, because that is given out to the committee as a confidential document.

The only difference that this route as now recommended by the engineers will have as a presently existing route is that instead of leaving the canal at New Orleans and going through the open water of Lake Pontchartrain, which is very difficult of navigation, we suggest a land cut which will shorten the route 9 miles and join into a canal that is now being constructed for the Maritime Commission so as to serve a large shipyard, the Higgins shipyard, at New Orelans. The dredges are there. It would only mean an extension of 18 miles more than what we have now. That is the only section that New Orelans is particularly interested in.

If the committee will refer to the confidential report made by the Chief of Engineers you will find some very informative facts justifying fully the construction of that route.

I would like to add that we are heartily in favor of a barge canal through Florida. We think it would be very unfortunate, after a 12foot waterway has been constructed from Trenton, N. J., to Jacksonville, Fla., and from Port Inglis, Fla., to Corpus Christi, Tex., that that small link of 92 miles should not be completed.

I am not going to dwell on the time it will take to complete it, because that is rather a debatable question, depending upon what facilities the engineers are given. It may be 3 years, as stated by the Chief of Engineers, or it may be less, if the proper facilities are afforded and the work is done under a forced contract. But after the emergency is over-and we do not know how long it will last—it is going to connect the Atlantic seaboard, through an inland waterway, to the Texas, and Mexican seaboard, which will give a direct route of cargo movement in peacetime and will improve the transportation conditions of the country.

Senator CARAWAY. Thank you very much.

STATEMENT OF JOHN FERLA, CONSULTING ENGINEER, UNITED STATES ASBESTOS CEMENT PIPE CO., CAMDEN, N. J.

Mr. FERLA. Madame Chairman, and gentlemen, I have been going before different boards and committees for a long time trying to get priorities to utilize the asbestos pipe which we manufacture for the carrying of crude oil and gasoline.

I first came in contact with the Oil Coordinator's Office, and there I waited for about 3 months. I met almost everybody there, outside of Mr. Davies and Mr. Ickes. I met practically the entire oil transportation staff. They would tell me to come tomorrow. I got tired of coming tomorrow.

I went down to the Power Board and met Mr. Krug. He saw the value of this pipe and immediately asked me to submit the pipe in order to have a test made of it. The pipe was sent to the United States Bureau of Standards, from which I have an excellent report, that they were unable to break this pipe.

The pipe is nothing new. It is similar to the pipe we manufactured without a steel lining. The bell is new.

After I came in contact with Mr. Krug he was very much interested. He immediately looked this pipe over.

From there I went to the Navy Department. The Navy Department immediately saw the value of the pipe, and for over a month they made thorough investigations, and you can obtain a copy of the report. The Truman committee has a report. Judge Mansfield has another report. The W. P. B. had a report just a short time ago.

I never asked the Oil Coordinator to give me any money. I asked him just to assist me to get priorities on 40 tons of manufacturing machinery. Four months ago I was ready to supply any quantity of pipe. We had one machine that produced 3,000 feet of pipe a day. We lost that time and I had to go to other boards. I did not ask for money. I asked to be given priorities to go down and do my duty. I am of Swiss descent, and I am an expert on asbestos cement in this country. Back in 1905 as a young boy I came to this country and installed the first plant for producing asbestos cement shingles. By 1908 people saw the value of this shingle, and I have been manufacturing asbestos shingles up to the present time.

I got in contact with the Baldwin Locomotive Works. This pipe is built under a 1,500-pound pressure. It requires a heavy machine. The Baldwin Locomotive people told me that if I had a priority 2-A they could deliver the machinery in 90 days to manufacture big pipe. The Oil Coordinator's Office said they wanted 35,000 or 40,000 feet a day.

Senator CLARK of Missouri. Do you just need priority on the machinery?

Mr. FERLA. Yes.

Senator CLARK of Missouri. Do you need any priority on the lining? Mr. FERLA. No, sir. At the present time we do not have to have a very heavy lining. We have several mills in the United States where they are manufacturing sheet metal for automobiles. We do not require any tubing or any piping. It is just sheet metal, and you fold it and weld it, and there you have the lining.