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It is true that on a further showing of facts and a reargument in connection with a motion for exercise of supervisory authority, the department reversed its decision in that case on other grounds; but the principle above cited has never been repudiated or qualified. On the contrary, it has been reannounced in the recent decision of Oregon Basin Oil & Gas Co. (50 L. D. 244). In that case it was found that the formations from which the oil values are expected to be developed within the limits of the claim exist many hundred feet below and are wholly unconnected with the formations penetrated in the holes drilled. In that connection the department held:

"Nor can the facts that the land may be geologically known to contain at depths formations and sands which have been proved in other fields to be heavily productive of oil; that the land has been in effect classified by the Geological Survey as valuable on account of petroleum deposits; or that above the supposed oil-bearing formations there exists within the limits of the claim gas deposits for which at the present time there is no available market, and which, on account of the excessive pressure thereof, can not be successfully drilled through in order to reach the supposed oil-bearing formations sought, be accepted by the department as the equivalent of a discovery.

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On the motion for rehearing of this case the following language was used: "The department is aware of no decision wherein. citing the rule announced in Castle v. Womble, it has ever taken into consideration the proven presence within the limits of a mining claim of deposits not actually and physically exposed therein as a ground for sustaining the sufficiency of an asserted discovery based upon the exposure within the limits of the claim of a deposit that did not warrant or justify the expenditure of time and money with a reasonable prospect of success in the development of a valuable mine on the particular deposit so exposed."

The contestant's attorney in his brief before the department contends in effect that the decisions applicable to pool oil should not be applied to oil-shale deposits because "these shales can not be pinched or squeezed out like the oil in oil sands to a synclinal fold or otherwise, any more than oil sandstone can be pinched or squeezed out independent of the oil contents," and there being no question that immense bodies of shale underlie this land as found by the register and receiver, the hazard of chance of finding them is removed.

As to this contention, it is sufficient to observe that although, from the nature of the deposit, the geologic inference from the presence of near-by outcrops of rich beds of shale may be far stronger that they persist and underlie the land in question than would be an inference that certain lands contained valuable deposits of oil in oil sands deduced from geologic indications and discoveries on adjacent lands, yet it will be perceived from the reasoning and conclusions in the Oregon Basin case and the East Tintic case above cited, that the essential fact to be established is the disclosure of the valuable deposit on the land in order to constitute a discovery and the degree of assurance that the deposit exists from discoveries and geologic conditions on near-by lands was not an important or controlling element for consideration. Such adjacent or surrounding demonstrations of the presence of a valuable deposit on surrounding claims do not dispense with the essential requirement of the law that the valuable deposit must be discovered on the claim.

There not having been made any valid discovery of mineral within the bounds of any of these claims at any time, the mineral claimant can not successfully contend that there was, upon the evidence in this case, diligent prosecution of work leading to discovery prior to February 25, 1920, or indeed at any time.

The only evidence offered by the contestant as to work of any kind being done on or for the benefit of these claims relates to the performance of annual assessment work in 1919, 1920, and later. The work in 1919, according to the testimony of one Chris C. Dare, consisted in repairing, widening, and extending an old pack trail which terminates 21⁄2 miles from the claims. Dare stated that he spent $4,400 on this trail for the benefit of 44 claims including these here in question; that a wagon could not get over it when it was finished; that the claims can be reached by a more circuitous and longer route. The contestant states that men and supplies could be transported by pack trail over trails of this character; that he had used five other trails to get to these claims; that there had been a shorter trail later constructed; that machinery and things of that kind could not be taken over it. The character and value of the work done on this trail, as testified to by Dare, was strenuously controverted by the contestee and a number of witnesses who passed over the trail before, after, and about the time this work was alleged to have been done, testified to the

effect that the improvement thereof was very insignificant and would not cost more han $50 or $100. The assessment work in 1920 and later consisted in digging shallow open pits either on the claims in question or nearby claims for the benefit of the claims as a group. In the case of United States v. Northern American Oil Consolidated (242 Fed. 727), the court defined diligent prosecution of work on a mining claim as follows:

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It is enough if reasonable effort was made at that time indicating a bona fide intention to complete the work of discovery in the particular claim with all practical expedition; such intention being manifested by the doing of physical act or acts which had a direct tendency to facilitate the exploration for and discovery of oil or gas thereon, although drilling has not commenced and the work may not have been done on each claim." Smelting Co. v. Kemp, 104 U. S. 636, 26 L. Ed. 875; U. S. v. Thirty-Two Oil Co. (D. C.) 242 Fed. 730, just decided; U. S. v. Ohio Oil Co. (D. (.) 240 Fed. 996.

It is not perceived how a slight repair of a pack trail that has never extended to the land, and the digging of shallow pits as assessment work tended in any way to facilitate the exploration for or discovery of valuable deposits of shale that are presumed to underlie the land in question at depth and the department is of the opinion that at no time were the mineral claimants engaged in diligent prosecution of work to discovery on these claims.

The strenuous contentions and conflicting testimony as to the performance of assessment work is of no moment in the case "assessment work had nothing to do with locating or holding a claim before discovery. On the contrary it was the condition subsequently prescribed by Congress to be performed in order to preserve the exclusive right to the possession of a valid mineral land location upon which discovery had been made. (McLemore v. Express Oil Co., 158 Cal., 559, 563." Union Oil Co. v. Smith, supra.)

A great mass of testimony was offered on both sides relative to the value of the land for agricultural or stock raising purposes. This is not an essential question for decision in this case but the testimony offered in that connection very clearly established that a valley which traverses this homestead has a substantial and certain value for dry farming and stock raising, that forage crops have been raised thereon by the entryman, and that he has resided upon and improved the land in good faith.

In conclusion, it may be stated that there is no merit in the conclusions of the contestant that the prior filing of the location certificates and staking and posting the land constituted such an appropriation of the land as would preclude a right of entry under the homestead laws. "Parties may not go on the public domain and acquire a right of possession by the mere performance of the acts prescribed for location, that is, where there is no discovery." (Lindley on Mines, sec. 218.) Mere paper locations do not prevent appropriation of land under agricultural laws." (Hirchfeld v. Chrisman, 40 L. D., 112.) "And the recitals therein constitute no evidence of discovery." (Independent Load & Copper Co. v. Levelle, on Rehearing 50 L. D. 5.) It is immaterial, therefore, what evidence of such locations was brought to the notice of the homestead entryman.

As no discovery within the meaning of the mining laws was made within the boundaries of any of the locations heretofore mentioned and as the claimants have not at any time been engaged in the prosecution of work to that end, the claims are of no validity.

In the case of a conflict between a mining location and a homestead claim the department has authority to inquire into and determine the validity of both, and if the mining location be found invalid and the homestead claim valid, to declare the former null and void and give full effect to the latter. (Cameron v. United States 252 U. S. 463.)

The mining claims in conflict with the entry of Summers and involved in this contest are therefore held to be null and void. The homestead entries of Summers will remain intact and the commissioner's decision is accordingly hereby reversed.

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Senator WALSH of Montana. Let me see if I can accurately state what the conclusion was as expressed in that opinion; namely, that although the mineral claimant had found on the surface of his claim, or by shallow diggings, oil bearing shale, there was not enough oil in it to justify the conclusion that that particular strata could

ever be profitably worked and the fact that it was disclosed that there were underneath, as a geological probability, beds that would contain shale, or consist of shale, that could be profitably worked, that that did not amount to a discovery.

Mr. FINNEY. That, I think, is substantially correct with this modification. I did find in this opinion that they had not definitely placed the location of the alleged discoveries, or of the alleged outcrops, except in the case of the one claim, the J. D. No. 2, where they said it produced seven and nine-tenths barrels to the ton.

Senator WALSH of Montana. I thought that was gallons.

Mr. FINNEY. Yes, sir; gallons. In other words, they had not gotten right down to brass tacks and specified that on each of the five locations there had been either a hole dug exposing this open bed, or that there was an outcropping, but your statement is substantially correct; yes, sir.

Senator WALSH of Montana. I just wanted to get the principle, as far as there was any principle announced in there.

Mr. FINNEY. Yes.

Senator WALSH of Montana. You wrote that opinion, Mr. Finney? Mr. FINNEY. I think that was written by an attorney in the office named Edson Phillips.

Senator WALSH of Montana. And, who participated in the inquiry on the review from the commissioner?

Mr. FINNEY. I presume it was reviewed by three members of our board of review, and the secretary's office, Mr. Gardner, Mr. Newman and Mr. A. W. Patterson.

Senator WALSH of Montana. Are they still there?

Mr. FINNEY. Yes; they are still performing the same duties.

Senator WALSH of Montana. Well, it would be one of them who wrote the opinion.

Mr. FINNEY. No; the paper was written by an attorney named Edson Phillips.

Senator WALSH of Montana. Upon consultation with the members of the board of review?

Mr. FINNEY. No; the practice is this, Senator, that an appealed case in our department is assigned out to one of the attorneys. You know we have a number of them, 19 at present. He reads the record, the testimony. the briefs and arguments, if there are any filed. Then he prepares himself a proposed decision for the approval of the Secretary, and that decision is forwarded through this board of review, on its way to the Secretary. The board of review, all of them, each of them, reads the proposed decision. If they agree, they put their names on the paper, or on the covering of the paper. If they disagree, they may call him in and discuss it with him or may suggest a modification. Possibly, if no agreement can be reached, they may have another attorney make a separate examination of the claim and prepare such decision as he thinks should be prepared, but if they agree with it they put their names on it and pass it along to the Secretary.

Senator WALSH of Montana. And, what did you say was the name of the lawyer who drew the opinion?

Mr. FINNEY. Edson Phillips.

Senator WALSH of Montaña. And, is he still with you?

Mr. FINNEY. No, sir, he has been dead for three or four years.

Senator WALSH of Montana. And, does the opinion bear the initials indicating the approval of the members of the Board?

Mr. FINNEY. This does not, but I presume the covering sheet does.

Senator WALSH of Montana. What is meant by the covering sheet? Mr. FINNEY. It is a sheet of paper that is placed over the top, partly to keep the typewriting from smudging, and it is a yellow cover sheet bearing the number and title of the case, and these initials are put on that.

Senator WALSH of Montana. You haven't got that here.

Mr. FINNEY. No.

Senator WALSH of Montana. You infer, however, that it did have the approval of the board.

Mr. FINNEY. Yes, it did have.

Senator WALSH of Montana. Well, then it came before you, Mr. Finney.

Mr. FINNEY. It did.

Senator WALSH of Montana. Does it bear your approval? You signed it, of course.

Mr. FINNEY. Certainly, I signed it.

Senator KENDRICK. Before you leave that, Senator, please.
Senator WALSH of Montana. Yes.

Senator KENDRICK. Under the present best known system of reducing this oil, do you have any information as to what would be considered profit earning shale as to the production? The lowest production of shale that would earn a profit.

Mr. FINNEY. Of course, I am not a technologist, but I do have considerable information.

Senator KENDRICK. You have heard that subject discussed.

Mr. FINNEY. Oh, yes. According to the best opinion of the people in the survey, and other places, there is none of these shales, the richest beds, that it would pay to work at the present time. The cost of mining the shale, either by shafts or through tunnels, and then the putting of that mass through a retorting or heating process, extracting the soluble elements, and then the refining of those soluble elements, would, it is estimated, cost from $2 to $3 a barrel.

Senator KENDRICK. Yes.

Mr. FINNEY. I think the estimate has been from $2 to $4. Now, oil is selling for about $1 a barrel so the loss would be from $2 to $3 a barrel, and that probably on this richest shale.

Senator KENDRICK. We were discussing, a few days ago, the extent of the oil shale fields. Have you any estimate as to what area that is known to include, these oil shale fields?

Mr. FINNEY. Mr. Ely has it. It has been compiled by the Land Office. Shall I read it?

Senator KENDRICK. Yes.

Mr. FINNEY. (reading):

The maps prepared by the Geological Survey indicate the following approximate acreage of oil shales in the three States mentioned:

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Senator KENDRICK. Is this particular territory considered the richest of the oil shale territories?

Mr. FINNEY. I think, so far as they have been actually explored and tested, that this Green River formation is considered to have the richest beds. There has not been very much development or testing in either Utah or Wyoming, although there are larger acreages bearing shales in those States.

And another thing, this particular formation here is nearer the railroad. It lies, as Senator Walsh said, north and west of the Glenwood Springs, and that is north and west of the D. & R. G. Railroad, and to the north is the old Moffat road, so that while there is no railroad that actually runs through the land itself it is easier to get in supplies and equipment. Possibly that has occasioned greater interest in those shales. Then, you will recall that under authority from Congress, and with an appropriation made by Congress, there was a test plant put out there, I think near Rifle, Colo.. and they made some tests and so forth. So that, the greater activity appears to have been in this particular area.

Senator KENDRICK. I recall that.

We had the other day-one of the things that prompted the inquiry-we had the other day a piece of legislation affecting the equities of, I believe, the Northern Ute Indians. on a tract, as I recall, of sixty thousand odd acres. Is that located in the neighborhood of this?

Mr. FINNEY. Yes, it would be in this general vicinity.

Senator GLENN. Senator Kendrick asked you a moment ago whether it would be profitable to work these claims and you stated that in your judgment it would not be now and that it would be a distinct loss. What about that same matter at the time this decision was rendered? Would it have been profitable then?

Mr. FINNEY. No, sir; oil was possibly a little bit higher in price, but even at that time the cost of mining, reducing these shales, and refining the oil therefrom, would have far exceeded the selling price. In other words, there has been no process discovered in this country up to the present time by which these particular shales could be mined, worked, and refined at a profit.

There has been some shale for many years mined and refined in Scotland and, I understand, disposed of at a small profit, but that is due to the high price of gasoline and oils, I presume, in Europe. Senator KENDRICK. These photographs that you have handed to me suggest that geological formation is an open book.

Mr. FINNEY. Yes, sir; those were photographs taken by the Navy from airplanes in and around the Naval Reserve, which is also in this identical formation, and near to these particular lands, and they give a pretty good idea of the topography of the country and show the exposure of these different beds in the canyons and the sides of the cliffs.

Senator GLENN. What is the total acreage involved in this matter? Mr. FINNEY. In this particular case?

Senator GLENN. Yes.

Mr. FINNEY. Approximately 640 acres.

Senator WALSH of Montana. The question of the extent of these shales being presented-I feel as if I should make this statement-I

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