The CHAIRMAN. It is the act of August 7, 1947, which is Public Law 382 of the Eightieth Congress, chapter 513, of the first session, being entitled "An act to promote the mining of coal, phosphate, sodium, potassium, oil, oil shale, gas, and sulfur on lands acquired by the United States." Is that the law to which you refer?

Mr. WHITE. That is the one to which I refer, Senator, and it excepted from the provisions of the statute certain categories of lands to which the Mineral Leasing Act would not be extended, and among those classes are tidelands and submerged lands.

Senator LONG. It specifically excluded them in that act.

Mr. WHITE. It specifically excluded those categories of land from the effect of the Mineral Leasing Act for Acquired Lands.

Mr. PERLMAN. May I interrupt there? I have a reference to it here. It is the act of August the 7th, 1947, 61 Statutes 613. This is a brief reference to it which says this: This measure, known as the Mineral Leasing Act for Acquired Lands, authorizes the Secretary of the Interior to lease, with certain exceptions, "all lands heretofore or hereafter acquired by the United States to which the mineral leasing laws have not been extended,

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It is expressly provided, however, "That nothing in this act is intended, or shall be construed, to apply to or in any manner affect any mineral rights * nor minerals that are or may be in any tidelands; or submerged lands; * * * or in lands underlying such 3-mile zone or belt, or the Continental Shelf, There are

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stars in there to indicate that some matter has been left out. The CHAIRMAN. I want to get this thing clear on the record. What was that section from which you just now read, Mr. Perlman? Mr. PERLMAN. It is in the first main section of the act, Senator. The CHAIRMAN. That is section 2, which reads:

As used in this Act "United States" includes Alaska. "Acquired lands" or "lands acquired by the United States" include all lands heretofore or hereafter acquired by the United States to which the mineral leasing laws have not been extended, including such lands acquired under the provisions of the Act of March 1, 1911 (36 Stat. 961, 16 U. S. C., sec. 552). "Secretary" means the Secretary of the Interior. "Mineral leasing laws" shall mean "the Act of October 20, 1914 (38 Stat. 741, 48 U. S. C., sec. 432); the Act of February 25, 1920 (41 Stat. 437, 30 U. S. C., sec. 181); the Act of April 17, 1926 (44 Stat. 301, 30 U. S. C., sec. 271); the Act of February 7, 1927 (44 Stat. 1057, 30 U. S. C., sec. 281), and all Acts heretofore or hereafter enacted which are amendatory of or supplementary to any of the foregoing Acts." "Lease" includes "prospecting permit" unless the context otherwise requires.

Now, that is section 2. Section 3, however, contains the language to which you point:

That nothing in this Act is intended, or shall be construed, to apply to or in any manner affect any mineral rights, exploration permits, leases, or conveyances nor minerals that are or may be in any tidelands or submerged lands; or in lands underlying the three-mile zone or belt involved in the case of the United States of America against the State of California now pending on application for rehearing in the Supreme Court of the United States; or in lands underlying such three-mile zone or belt, or the Continuental Shelf, adjacent or littoral to any part of the land within the jurisdiction of the United States of America. The law, however, contains section 9, and I read this because I would like to lay the whole record on the table as we go along.

Senator MILLIKIN. Mr. Chairman, I think it is perfectly obvious to the chairman that an exception might have resulted for procedural purposes to accommodate the lawsuit, but it might also have been

another congressional affirmation that the Government had no claim to those minerals.

The CHAIRMAN. That might be true if it were not for section 9. Senator MILLIKIN. It would be interesting to know what the report had to say on that.

The CHAIRMAN. If it were not for section 9, which is also a part of this law, and which is involved in litigation now pending in the courts. Section 9 reads as follows:

Nothing in this Act shall affect any rights acquired by any lessee of lands subject to this Act under the law as it existed prior to the effective date of this Act, and such rights shall be governed by the law in effect at the time of their acquisition; but any person qualified to hold a lease who, on the date of this Act, had pending an application for an oil and gas lease for any land subject to this Act which on the date the application was filed was not situated within the known geologic structure of a producing oil or gas field, shall have a preference right over others to a lease of such lands without competitive bidding. Any person holding a lease on lands subject hereto, which lease was issued prior to the effective date of this Act, shall be entitled to exchange such lease for a new lease issued under the provisions of this Act, at any time prior to the expiration of such existing lease.

Now the argument is made under that section that since this act was. approved August 7, 1947, and since section I of the Leasing Act applies to all lands owned by the United States, that applicants who filed under the Mineral Leasing Act prior to the 7th of August 1947 are protected by this section.

Now the Solicitor of the Department of the Interior, in filing the opinion which was approved by the Attorney General, based his contention that the Leasing Act did not apply, as I recall it, primarily upon the fact that the phrase "the public domain" was used in the title of the act of 1920.

Mr. WHITE. That was the basis primarily for the Attorney General's construction of the Mineral Leasing Act in the opinions of 1924 and 1941. When I considered the problem in 1947, I based my opinion largely upon the constructions by the Attorneys General, rendered in the two opinions which I mentioned a moment ago, and upon the action of the Congress in specifically excluding from the scope of the Mineral Leasing Act for Acquired Lands both tidelands and submerged lands.

Senator LONG. Now here is the question I wanted to get to, if the chairman has made the record sufficiently clear at this point. If a person filed for a lease on a geologic structure that is not known as a producing structure, upon what terms would he acquire that lease?

Mr. WHITE. Insofar as wildcat territory is concerned, the leases are issued noncompetitively under the Mineral Leasing Act to the qualified person who first files an application, and the lease carries a royalty rate of 1212 percent.

Senator LONG. What rental payments would have to be made?

Mr. WHITE. The rental payments are at the rate of 50 cents an acre for the first year, and 25 cents an acre for other years, except that the lessee is excused from paying rental for the second and third lease years.

The lease is issued for a period of 5 years, and it is subject to an additional 5-year extension if, at the expiration of the primary term, the land is not then within the known geological structure of a producing oil or gas field.

Senator LONG. Since the passage of that act, of course the exploration of oil has developed as a science and it is more easily possible to find where oil is likely to be, particularly by seismographic methods. I am sure you are familiar with the fact that in these tidelands, I think the average in Louisiana and Texas runs somewhere around $20 an acre for bids even in undeveloped structures.

Mr. WHITE. I understand that very sizable sums were collected by Louisiana and Texas in the form of bonuses or rental payments in lieu of drilling.

Senator LONG. Those persons who would apply on those areas, for example on a seismographic structure, in applying for a Federal lease if the Federal Leasing Act were held to apply, would be entitled to go and dispossess someone who had paid $20 an acre under a State lease, by the payment of 50 cents an acre under a Federal lease in some cases?

Mr. WHITE. If the Mineral Leasing Act applied to these lands, the leases would be issued on the basis that I mentioned a moment ago as to those areas which are not within the known geological structure of a producing field.

Senator LONG. To apply that to a specific situation, let us assume that someone upon a State invitation to bid had sent a seismograph crew into the tideland areas, particularly in the offshore areas, and had discovered a very excellent prospect, and he had asked for the opportunity to bid under a State law, and had bid, let us say, $20 an acre, assuming that he had found a worthy structure.

Now after he had acquired that structure and gone to the expense of seismographing and exploring it, but before he had produced oil from it or commenced actual drilling, it would still be possible for a person applying for Federal lease, if the Federal Leasing Act were held to apply, to displace this person by a bid of 50 cents an acre for a lease, where the person under the State lease had paid $20 an acre, would it not?

Mr. WHITE. That is right. The Department would issue a lease, if the Mineral Leasing Act applied, to the qualified person who filed the first application, and no bonus payment of any sort would be required, and the rental payments would be in the sums which I mentioned a moment ago, 50 cents an acre for the first year.

Senator MILLIKIN. Mr. Chairman, it might be clarifying if it were said that the seismograph reduces the risk but does not eliminate it. In other words, the seismograph structure is not necessarily a producing structure.

Senator LONG. That is right.

Mr. WHITE. That is right, Senator. The producing structures are those from which oil is actually being produced, and the limits of the structure are defined by the United States Geological Survey under a delegation of authority from the Secretary of the Interior.

Senator LONG. I thank you very much. You have been most helpful at this point. I would like to discuss it with you later.

Seantor MILLIKIN. Seismographs have helped the United States Geological Survey in making better definition of the structure, but it has not eliminated possible error in that field.

Mr. WHITE. That is very true, Senator.

Senator LONG. Mr. Perlman, I would like to ask you this further question. There has never been any real controversy, particularly in

the Louisiana and Texas cases, as to the right of the Federal Government in terms of navigation, national defense, or regulation of interstate and foreign commerce. The States have never contested that

point, have they?

Mr. PERLMAN. No, sir.

Senator LONG. The sole contest on the part of the States has not been on the question of granting Federal authority to regulate commerce and the Federal war powers and incidental powers thereto.

The States contend that that would still not carry with it the actual ownership or title to any oil or resources on the Continental Shelf or off the shores of the States, is that about their position?

Mr. PERLMAN. That was their position, Senator.

Senator LONG. That was the position they urged?

Mr. PERLMAN. That is the position they urged. The Supreme Court, however, has decided that the paramount power and the full dominion belongs to the Federal Government, and they have ordered Texas and Louisiana to account to the Federal Government for all revenues received from June the 5th, 1950, the date of their decision in both of those cases, and, in the case of California, we have a stipulation that has been renewed annually that provides for an accounting from June 23, 1947, the date of the decision in that case.

Senator LONG. Of course, Mr. Justice Frankfurter's dissent in the California case-and his views were the same in the subsequent cases-did indicate that in his opinion the title question was completely separable from the rights of the Federal Government in regulation of commerce, war powers, and things of that sort.

Mr. PERLMAN. Mr. Justice Frankfurter dissented in the California case. He, I believe, dissented in the Texas case. In the Louisiana case I do not think he dissented.

Senator LONG. He said that his opinions were expressed in the Texas dissent, as I recall it.

Mr. PERLMAN. He dissented in the California decision which was made in 1947, and he did not see any difference between the situation that affected Louisiana and the situation that affected California. He did not see any difference between those two situations.

Of course, as you know, some of the members of the Court felt that there was a difference so far as Texas was concerned that did not apply in the case of Louisiana.

Senator LONG. Now as I understand it, in those decrees that were submitted, your decree that you offered to the Court stated that the Federal Government had paramount right, and I believe full dominion

over.

Mr. PERLMAN. That is right.

Senator LONG. And it also said, "and title to these properties," as I recall.

Mr. PERLMAN. No, sir. Maybe I could straighten you out on that, Senator. The California case had been decided just before I came into office in 1947, and I had to draft a decree in that case; while the Court decided it in June, they provided that the Government should submit a decree in September, and we did submit a decree.

We had the word "proprietorship" in the decree that we submitted. The Supreme Court signed the decree as submitted, taking out the single word "proprietorship." We did not repeat that word in the

decrees that we submitted in Texas and Louisiana cases, and those decrees were signed exactly as we submitted them except for the change in the date for accounting.

Senator LONG. Do you place any significance at all upon the Supreme Court striking the word "proprietorship?"

Mr. PERLMAN. I tried to explain it before at length. We have claimed ownership in all of the suits that we filed, in all of the papers that we filed. We have claimed technical ownership. The Supreme Court, however, in handing down its opinions and in these decrees, has confined itself to finding that paramount power and full dominion is in the Federal Government.

In the Texas and Louisiana cases you will notice that the opinion written by Mr. Justice Douglas, for the majority of the Court, described the rights of the United States as something that resulted from a coalescence of title and sovereign power.

He said they all coalesced into the paramount rights, and in Justice Black's opinion, when he used the words "paramount power," I think he made it clear that it was a title that was above and beyond the ordinary title such as we know in dealing with real estate, with fast land titles. It was something superior to ordinary ownership. It was acquired by reason of the national external sovereignty.

The CHAIRMAN. In other words, was it not a fact that the rights in the marginal sea in this area seaward of low water in the area within the 3 mile belt and without the 3-mile belt had been held to be derived from international law, the law of nations rather than from the common law.

Mr. PERLMAN. That is right.

The CHAIRMAN. In other words, was it not the position of the Supreme Court that this paramount right which it asserted was an attribute of the sovereignty not of the specific States of the United States but of the sovereignty of the United States under the Constitution.

Mr. PERLMAN. Senator, they went further than that. They said the States had no such title. In the California case there was an express finding

Senator LONG. Said they had no title.

Mr. PERLMAN. They had no title, and that finding, of course, applies in the case of the other States. They found the States had no title, whatever title there was, and certainly all the paramount right and the full dominion that they described are in the United States and not in any sovereign State.

The CHAIRMAN. So that there are really two issues involved in this controversy. One issue, so far as the quitclaim bills of the past and of the present are concerned, is whether the Congress of the United States shall surrender its Federal sovereignty, a power and a dominion which it has acquired under the laws of nations as an attribute of its own sovereignty. Or whether the Congress shall protect the right which the Federal Government now has, and always had, while that controversy is being fought out as to what Congress may wish to do— whether we should in the public interest pass an interim bill, the purpose of which is to permit continued operation and production and exploration in this area.

Mr. PERLMAN. That is right, Senator. I want to make it clear because the Senator from Louisiana is interested in that subject mat