Senator HANSEN. No, I have no comments right now, thank you, sir. But if I may, I'd like to make a statement to the subcommittee at the close of these hearings.

Senator HART. We welcome the able Senator from Colorado, whose concern over the years in this subject matter and whose knowledge is recognized by all. We are very grateful to you, Senator Dominick, for coming.

STATEMENT OF HON. PETER H. DOMINICK, A U.S. SENATOR FROM THE STATE OF COLORADO

Senator DOMINICK. Thank you, Mr. Chairman, my fellow colleagues on the subcommittee, and Senator Hansen.

Thank you for allowing me the opportunity of appearing before you. I think these hearings will cast off any doubts which may still remain as to the advisability of proceeding with the development of this enormous national resource.

A myriad of statistics is now available, but I want to point to just a few at this time as I feel they are germane to these hearings.

Estimates of content of oil shale deposits in the United States stretch from 600 billion barrels of oil equivalent for shale yielding 25 gallons per ton to as high as 2 trillion barrels of oil equivalent if we include low quality shale yielding 10 gallons per ton. It is my -understanding, Mr. Chairman, that with the present price of oil and present technology, the shale could not be profitably processed at a vield of much less than 30 gallons per ton and that many of the reserves contain only 5 gallons a ton and may never be touched.

Nevertheless, this is a great natural resource of the Nation. Colorado, more than any other State, is intensely interested, for 75 percent of the known deposits lie within its borders.

Approximately 80 percent of the reserves are federally owned and 20 percent privately owned, according to testimony of Secretary Udall before the Senate Committee on the Interior in February 1967. In Colorado, the Federal Government holds 72 to 78 percent of the oil shale acreage; but since the richer deposits are situated on Federal land, it may control 85 percent of the formation's reserves. For the most part private holdings are in isolated pockets or thin strips of low-yield shale.

Thus competition to date is not only practically nonexistent, it has been almost impossible. Furthermore, one could not reasonably expect private sectors to build a full-scale industry, and I want to underline the words "full scale," on marginal lands lying on the fringe of rich public deposits with the risk of being destroyed overnight should the Federal lands be opened.

Mr. Chairman, I have been an ardent advocate for the development of an oil shale policy. I have been urging our administrative and executive branches of Government for years to develop a leasing program. In 1964 I joined my good friend and esteemed colleague Senator Allott in cosponsoring S. 2809 in an effort to clarify the status of pre-1920 unpatented oil shale placer mining claims, which complicate all efforts to develop this resource.

The Senate Public Lands Subcommittee, to which the bill was referred, sent copies to the Department of the Interior, Department of

Agriculture, and the Bureau of the Budget for comments. The result: No comment from these Departments. The bill died in the subcommittee. In February of 1965, I joined with Senator Allott in introducing S. 1009, a slightly revised version of the earlier bill. S. 1009 died in the Senate Minerals, Materials, and Fuels Subcommittee when the Department of the Interior and the Bureau of the Budget failed to submit any reports. We currently have pending S. 1068, introduced February 23, 1967. This bill would change the application of the depletion allowance to the end of the retorting process. It has been referred to the Senate Finance Committee. No action has been taken on it up to date.

In September 1964, I was pleased to attend the official reactivation ceremonies of the Anvil Points Oil Shale Research Center at Rifle, Colo. Construction on the present facilities initially began in 1945 after Congress provided funds for research into petroleum substitutes under the pressure of a high petroleum demand caused by World War II. Shale oil was produced by the Bureau of Mines on this site some 2 years later that would make it 1947-and the Center operated until 1956. The facilities were kept on a standby basis until early 1964 when the Department of the Interior was authorized by the Congress to lease the plant to the Colorado School of Mines Research Foundation. Today, intensive oil shale research is again underway.

Despite the delay we have experienced in the forming and implementing of a national oil shale policy, private initiative has continued to strive for progress. I would like to call to the subcommittee's attention the fourth symposium on oil shale conducted at Denver, Colo., on April 6 and 7, 1967. The symposium was sponsored by the Colorado School of Mines, the Colorado School of Mines Research Foundation, and the American Institute of Mining, Metallurgical, and Petroleum Engineers. Among the titles of the papers presented were: "Impact of Dawsonite and Nacholite on Piceance Creek Basin Oil Economics," "The Oil Shale Industry Water Problems," "Present Trends in Russian Research on Processing of Oil Shale," "Fracturing Oil Shale with Electricity," "Explosive Fracturing Tested in Oil Shale," "Hydrotorting-Use of Hydrogen for Improved Recovery of Shale Oil,” "The Characteristics of a Low Temperature In Situ Shale Oil," "Conduction Heating of Oil Shale Formations," "Kinetics of Oil Shale Pyrolysis," and "Northern Alaska Oil Shale." A release by the Colorado School of Mines Office of Public Information concisely summarizes the highlights of the symposium, and I request that it be inserted in the record.

(The document may be found on p. 491.)

May I share with the subcommittee a few of the comments in a translation presented on reports of oil shale activity in the Soviet Union. Large-scale commercial activity started in a large basin near Leningrad after World War II. The Soviets claim to have developed more than 10 large underground mines and several open pit mines with a total output in 1966 of 25 million metric tons. They also assert the largest oil shale research center in the world is their own Oil Shale Institute. A modern mine is apparently now under construction which will cover an area of 50 square miles, utilize 30 miles of conveyor belts, and process some 33,000 metric tons of shale per day. Interest in oil shale clearly is not confined just to Colorado, Wyoming, and Utah.

Mr. Chairman, it has been 37 years since President Hoover withdrew these lands for "investigation, examination, and classification." For 34 of those years "inaction" was the watchword of the administrative and executive branches. The appointment of the Oil Shale Advisory Board was a glimpse of hope, but after the issuance of the controversial interim report in February 1965, inaction again set in.

I am pleased, in fact delighted, that the Secretary of the Interior has finally come forth with his proposed five-point program. Perhaps we are at last getting underway.

It is difficult to comment upon the proposed program at this time as it relates to competition and antitrust. Not only are we dealing with an industry which does not yet exist but the terms of the leasing regulations are presently unknown. In the February 1967 hearings before the Senate Interior Committee, Secretary Udall indicated preparation of these leasing regulations was on schedule. Hopefully, we will have them next week at the latest, but rumors are that it will be later than that.

There are some observations, however, which I would like to make this morning. There has been little mention to date of how the recipients of leases are to be selected. Is competitive bidding to be used or some method of random selection? Whatever the system, it is essential that individuals and smaller companies have an opportunity to participate.

We do not as yet have any guidelines as to control of technological data. Are discoveries made during the period of the provisional research and development leases to become part of the public domain? If so, a difficult problem exists with respect to companies which have already accumulated considerable data. Consideration also must be given to the role existing patents and any other pending patent applications are to take. Even if a decision is made to place technological controls on the research and development leasing phase, is it necessary to impose such restrictions on companies which have successfully completed research and development and made discoveries under their production lease?

I am more than a little concerned with the impact on competition which is evident from the one-sided approach on two-stage leasing. The January 1967, announcement would lead one to believe that, if he successfully performed an R. & D. lease, he would get a production lease on a larger tract. Mention was made that the application for the R. & D. lease would specify the approximate volume and location of shale which would be required to support the production lease. Secretary Udall's February testimony, however, indicates the R. & D. lease "may" ripen into a full-scale production lease depending upon performance results "and what is learned from these contractual arrangements." The first contingency is understandable, but the second is not. The January announcement stressed the "firm assurances” which would be required of the R. & D. lease. It would seem to me that "firm assurances" should be a two-way street. Some guidelines as to the terms of the production lease should be made not only a part of the R. & D. lease application but of the R. & D. lease itself. As an alternative to detailing the anticipated location of the shale for the production lease, terms could be placed in the R. & D. lease providing that all companies which satisfactorily complete the first stage of the

leasing program will be eligible to bid when the first production tracts are released. You will note this is a different type of proposal than simply saying production leases are going to be contingent "on what is learned from these contractual relations."

Of course, unless some type of commitment for the production leasing stage is offered by the Federal Government, I feel the likelihood of a number and variety of participants in the R. & D. program is substantially curtailed.

Secretary Udall stated in the February 1967, hearings that the Department of Interior feels the consortium approach is superior in looking to possible lessees in the R. & D. stage. This raises a number of issues which are pertinent to and will undoubtedly be discussed in your hearings. If such an approach is taken, public interest requires the full and adequate disclosure of the identity and interests of consortium participants.

Two chief areas of title problems are of immediate concern: overlaying dawsonite claims and pre-1920 unpatented mining locations. Even with Interior operating at full speed, resolution of these may take years. In February, Secretary Udall stated "much" of the 80 percent of reserves which are federally owned have clouded titles. He also indicated that this legal underbrush must be cleared away as a prerequisite to initial development leases and blocking up programs. However, it is my understanding some of the Federal land is free and clear now. It is imperative that Interior make an early determination of the extent and location of Federal lands which currently have clear titles and which could be made available for immediate leasing. Otherwise, I foresee considerable delay in proceeding with even the R. & D. leasing program.

I already have referred to the attempts of myself and my Senate colleagues from Colorado, Wyoming, and Utah to aid in clearing the air with respect to the pre-1920 unpatented oil shale placer claims. I am looking forward to the transmittal of Interior's draft of a recording statute. I suspect it will be founded upon many of the same concepts which we previously presented in our bills and on which we received no report or other action from the Department.

Mr. Chairman, the oil shale and associated minerals in these formations constitute a resource of considerable potential to our country. The need to develop the technology is self-evident for the resource has little value if technology is not allowed to progress. I am gratified by the increasing crystallization of opinion that we must get moving. We cannot afford to remain idle and see advances in other sources of energy render oil shale outdated. The possibility of leaving such a vast resource untapped to me at least, is unthinkable. It has important bearings on our economy and our national defense. We are a nation which is placing increasingly heavy reliance on foreign oil, while there are tenuous situations in the countries from which this oil is obtained and increasing tensions on a worldwide basis. I have only to mention the recent nationalization of the oil pipelines in the Middle East and a variety of other subjects of this kind to indicate some of these problems. Some estimates are that by the early 1980's 30 percent of our oil will be from foreign sources if we keep going the way we are now. This, when coupled with projections from some private sectors of necessary leadtimes of 8 to 10 years before "on

stream" production can be achieved and the prerequisite of successful completion of an R. & D. lease program before issuance of a production lease, emphasizes the need for diligence at this time.

Private industry has for the most part done more than any other segment to develop the technology which we now have. Large commitments have already been made. It is pleasing to see that Interior's program contemplates the involvement of both private individuals and companies. This is consistent with our national heritage and the goals of our free enterprise system. It is consistent with the history of our putting to use other public domain mineral and energy resources. Indeed, our Nation's finest resource is private initiative. We would be remiss if we did not utilize it.

Mr. Chairman, I want to say parenthetically that I think one of the reasons that we presently have a five-point program from the Interior Department, is because of the initiative of private enterprise. If these individuals had not discovered dawsonite, nahcolite and other associated minerals, intertwined with oil shale and applied for leases, I am not a bit sure that we would have had action for a number of years on what to do about oil shale. These other minerals apparently can't be produced without also taking the oil shale. So, the private initiative of individuals and companies certainly already proved that this is one spur to the development of this resource.

I am firmly convinced that use of the private sector is the proper approach. At the fourth annual oil shale symposium on April 6, 1967, Gov. John A. Love also endorsed this method. I have a copy of Governor Love's statement with me today and ask that it be inserted in the record.

Senator HART. It will be.

(The statement referred to may be found at p. 492.)

Senator DOMINICK. We are all interested in protecting the public interest and I see no reason why, with a full airing of the issues and the cooperation of the Federal, State, and local governments along with industry and private individuals, this cannot be done.

I want to be frank with the Chairman and this subcommittee. There are many problems facing us in this program-water supply problems, waste disposal problems, maintenance as far as practicable of the scenic and esthetic values of the area (and they are enormous as we well know in our great State) the preservation of true competition between large and small companies and individuals, water pollution control mechanisms, and so forth. But these problems have been solved in the development of the uranium industry and are certainly open to solution here.

After all, a national resource of a wasting natural asset is only of value if you start putting it to use. Otherwise the asset remains in the ground and is of no use to anyone, except for the scenic value of the country in which it lies. So, Mr. Chairman, I say we have a vast national resource and it should be put to use. It seems to me that we must get on with the job.

Senator HART. Thank you very much, Senator Dominick. I think all of us in listening to your statement have been struck by the extent of your knowledge. All along we have realized you have been lecturing us, you and Senator Allott, in the Senate on this subject.