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change, the new statute should take. For example, this is not a case where the Executive proposes to change the method of disposal of a resource (e.g., from location to leasing) and, in the meantime, proposes that the operation of the existing disposal laws be suspended. On the contrary, in this case there is agreement between the Executive and the Congress that legislation is needed and there is agreement on the general approach which that legislation should take, i.e., leasing.

There is, however an obstacle to the fulfillment of this mutual objective to Congress and the Executive vis-a-vis geothermal resource development which arises by reason of the mining laws even though geothermal steam is not of itself either a locatable or a leasable mineral. The obstacle, of course, is that, if a valid mining location were to be made in ground which also contains geothermal steam, a patent obtained under the mining laws would carry with it the geothermal resource as well as all other rights not reserved by present law.

It follows, therefore, that unless the withdrawal authority extends to metalliferous as well as non-metalliferous minerals, the objective of orderly development of the geothermal resource on federally owned lands is to that extent frustrated. It seems to us clear that the situation with respect to geothermal lands presents what might be termed a classic case for the Executive to act as the agent of Congress in public land administration as expounded by the Supreme Court in United States v. Midwest Oil Company, 236 U.S. 459 (1915). Mr. Justice Lamar, speaking for the Court, pointed out, at pages 473-475, that (1) the President, in the administration of the Federal lands, acts as an agent for the Congress, the principal, (2) the public land laws, enacted under Article IV, section 3, of the Constitution, partake more of the nature of the rules and regulations of a proprietor for the management of his property than of the nature of statutes enacted under Article I, and (3) the agent, in the event of changed circumstances or in an emergency, may, unless expressly directed otherwise by his principal, act by a withdrawal to protect his principal's interest.

To be sure, the Pickett Act (43 U.S.C., secs. 141-142) excepts metalliferous locatable minerals from the type of temporary withdrawals with which that act is concerned. However, as was recognized by Attorney General Jackson in his opinion at 40 Ops. Atty. Gen. 73 and by the House and Senate Interior Committees in their reports (H. Rep. No. 215 and S. Rep. No. 857, 85th Cong.) on the Engle Act (43 U.S.C., secs. 155-158), the Pickett Act does not occupy the entire field of withdrawal authority.

Given the limited scope of the Pickett Act, we cannot conclude that it was the intent of Congress to strip the Executive of authority to act as agent in maintaining of Congress's options with respect to geothermal lands in the circumstances present here. These circumstances, as we have said, require the withdrawal of geothermal lands from metalliferous mining location if the already manifested intent of Congress with respect to federally owned geothermal steam resources is to be fully realized.

In addition to the foregoing, there is, in our view, another reason why the withdrawals here involved are not inhibited by the Pickett Act. That act deals with so-called temporary withdrawals. As pointed out earlier, however, the geothermal steam withdrawals have a continuing purpose to facilitate the administration of the geothermal lands under whatever form of leasing legislation the Congress may enact.

Sincerely yours,

STEWART L. UDALL, Secretary of the Interior.

Mr. ASPINALL. This list of documents, Mr. Chairman, will give the chronology of the sweeping, and in my opinion, completely unwarranted geothermal steam withdrawal from February 7, 1967, to the present time. I will say that I am not satisfied with the responses I have received, particularly with the interpretation of the sweeping authority of the President's so-called implied authority to make withdrawals of public lands notwithstanding the Secretary's reference to the Midwest Oil case.

In addition to many other questions to be answered, I think this committee should receive some clear and positive answers from the

Departments regarding future withdrawal of geothermal steam lands from mining location. It is my feeling, I hope erroneously, that even if we should enact any of the measures now before us, the Departments still intend to keep this land withdrawn from mining location and to exclude mining from land under geothermal leases. I hope this question will be answered.

I have not, and will not, encumber the record with the many protests the committee has received regarding this action. It appears sufficient to state that the opposition of those who are interested in the values themselves, was unanimous.

In view of this committee's extensive hearings on this matter last session, which covered 8 or 10 days, I doubt that much new material can be added to the already voluminous record. It is my hope that the time of the committee will not be wasted again this session and that a bill will be reported out that is acceptable to all concerned.

That's all, Mr. Chairman.

Mr. EDMONDSON. The gentleman from Pennsylvania.

Mr. SAYLOR. Mr. Chairman, I would like to commend the chairman of the full committee for placing in the record the list of statements that have been issued by the various agencies in the Federal Government in this matter. I would like to commend him for the statement that he made with regard to legislation now before us. I know they say, the President said in his veto message that the grandfather clause might amount to a free gift of valuable public property rights. It is very interesting to note that there is on the statute books at the present time the Mineral Leasing Act of 1920, which has just such a grandfather clause in it. Nobody I know of has ever said that grandfather clause amounted to a free gift of valuable property rights. All it did was to allow those individuals who held mining claims on which they were diligently working to convert them to preference right_leases. Now, if the people in the Interior Department are so concerned about this great preference-then they better get busy and send back here some recommendations on some of these other bills that are on the statute books right now with this same type or similar grandfather clause in it, to be repealed.

Now, then, the second reason given was that they provided for a maximum lease. You will notice that it says:

Areas four times greater than our experts say is needed for economic development.

Now, I want to find out where those experts are because they sure were not here last year. I have looked out over the audience and I do not see any new experts. And they better have them, because if we are going to have the same, the same old rehash, we are going to have to find out who the new experts are.

Now, then, there was not anything in the recommendation which we got from the Secretary last year telling us on what royalties should be paid. So, this committee in its wisdom and the counterpart in the Senate whom I think have as much interest in the public as the people in the Interior Department, we fixed the royalty matter, and the manner in which the steam should be sold or utilized. That is how these royalties should be paid. Then it comes along and says:

It fails to provide specific and clear authority for the Government to readjust the lease terms and conditions at suitable intervals.

Now, then, I don't know that they have ever had this before and they do not know why they suddenly come along and want to do this with geothermal steam. They wish now that we should add this provision. It says, "it provides for perpetual leases." Well, you have got a provision in the law right now that goes even further than that and says you not only can get a perpetual lease, you can get title to the property if you do what is on the statute books rights now. Then it


It gives the developer 20 years in which to begin production.

Now, there is not anybody down in the Interior Department that I know of that has ever drilled a well or ever been around when one has been drilled. Then they say:

Our scientists and engineers say that this 20-year development period is too long.

I want to find out where these people are in the Interior Department who have gained all of this knowledge since we completed these hearings last year.

Then they go further to say:

They represent a serious failure to protect the people's interest.

I am sick and tired of hearing that the executive branch of government is the only outfit that protects the people's interest. They have insulted us. I want to tell this committee that I'm surprised, Mr. Chairman, that you even bother to go ahead and have a committee hearing on this. If I were in the position you are I do not know if I would even dignify the Interior Department right now by having a hearing.

On May 25, 1967, they sent us a report on a bill which they urge enactment of H.R. 9583. And they say it's identical to the administration's proposal which was transmitted to the Speaker of the House of Representatives on February 2, 1967. "We urge its early enactment. Since when is the executive branch of the government supposed to legislate?

The Founding Fathers, when they set up the Constitution, said that was a responsibility of the Congress. If they do not like what we legislate, they can veto it. It is a good thing they put this in the way they did, after Congress adjourned, because I am sure this committee and its counterpart in the Senate would have been able to muster enough votes to override the veto.

Mr. Chairman, I think that this committee has been insulted by the Interior Department, those who represent it, and the manner is strange and unusual. It represents to me a sad commentary on our Government in 1967.

Thank you, Mr. Chairman.

Mr. EDMONDSON. The gentleman from Nevada.

Mr. BARING. Thank you, Mr. Chairman. I think either the bill passed out by the full committee last year or the amended bill as passed by the House and Senate were good bills and did fully protect the public interest. However, this is now water under the bridge and we now are faced with again considering legislation for the disposal of geothermal steam. In glancing through the various bills I find they are all familiar and I think we will find, as we get into the details of them, that they

are very similar to the proposals which we considered and studied so thoroughly last year.

Mr. Chairman, this year I introduced a measure, H.R. 3577, which in my opinion, will bring about the basic development of our geothermal steam resources and the accompanying byproducts.

I hope the subcommittee and the full committee will look with favor upon this measure as it is essentially the same bill which the full committee recommended to the House last session. I thought this proposal was sound legislation last year and I think it is sound legislation this year. However, I want you to know that I am not advancing this proposal as the final panacea to the full development of these resources. I do not believe, as apparently some of our executive departments do, that there is only one way to handle this situation-and that is namely their way. I know that it is important to recognize that geothermal steam development is an infant industry in this country. Private enterprise should be encouraged to invest in it in every possible way, and, of course, such encouragement should take the form of reasonable rewards consistent with the risk attendant upon any such new enterprise.

The bill which I advance is done so with a view to bringing about thorough consideration of the role that geothermal steam will play in our economy and the manner in which it shall be disposed of. I am hoping that through careful consideration of this and any allied measures, that we may develop as an outcome of this hearing today, an act which can be passed and signed by the President and which will give us a good start in advancing the infant geothermal steam industry now existing.

Other nations have already gotten a head start in the use of geothermal steam resources. This is particularly so in New Zealand, Iceland, and Italy. I had the privilege, as a member of this subcommittee, to view the geothermal steam uses in Iceland and Italy a few years ago. The heat generated from the steam can be used in production of electrical energy and also to provide heat for human habitation. On many localities the steam carries with it much needed minerals such as rare metals and salts. In a number of places in the West today, geothermal brines are now producing minerals.

The greater part of geothermal resources of this country are located primarily on the public domain, and there are extensive resources believed to exist in my own State of Nevada. Today there is no provision in law under which the Secretary of the Interior can lease or otherwise dispose of geothermal resources in these lands.

For this reason commercial developers of geothermal steam resources have attempted to secure rights to them under other laws such as under the Mineral Leasing Act or by the staking of placer mining claims. This confused situation results in the introduction of my bill, H.R. 3577.

Mr. Chairman, before closing, I, too, feel that I must comment on what I consider to be a completely irresponsible and ill-advised action on the part of the Department of the Interior. I refer, Mr. Chairman, to the proposed withdrawal order of February 7, 1967. This withdrawal, which in my opinion was and is of questionable legal authority, was so vague, general and all-inclusive in its terms that as a practical matter it placed a cloud upon the availability of every acre of

public land. At a minimum this proposed action, according to maps furnished by the Department, would have precluded and I quote "all appropriations under the public land laws, including, without limitation, the mining and minerals leasing laws" on over 86 million acres of public land. Mr. Chairman, this is a fantastic amount of land and just by way of comparison let me state that it is more land than is contained in each of the States of Arizona, Nevada or New Mexico and only slightly less than in the State of Montana. Mr. Chairman, further comment on the obvious dangers of such an action appears unnecessary to members of this committee.

To be fair to the Department, I must say that after they were flooded with protests regarding this action, they reconsidered and cut the proposed withdrawal down to about a million acres. This is still a lot of land and I feel that protests are still in order.

Mr. Chairman, it is my hope that we will be successful this year in gaining the support of the Executive Department for a bill that will permit this resource to be developed.

Thank you, Mr. Chairman.

Mr. EDMONDSON. The gentleman from California, Mr. Hosmer.

Mr. HOSMER. Mr. Chairman, the measure that I have introduced here is almost the same as the bill which was passed out last time, with a few corners knocked off. If you remember, we were working on a close time schedule at the end of the session. And, therefore, the minimum improvements that we might have added at that time have been included in H.R. 715.

I think that it is necessary to put on the record that this measure and similar measures in the first place takes off 10 percent of the royalty to the Government. In the next instance, the Government takes 50 percent of the profit that anybody makes on the stuff. That is 60 percent to the Government, 40 percent of the remaining revenues or profits going to enterprise. I doubt if less could inspire enterprise to do the work that is necessary to develop this resource. I want to point out that the depreciation allowance usual with other activities of this kind does not pertain, there is no provision for depreciation in connection with the geothermal energy and that is another consideration which we must bear in mind. I know of no effort being made to provide any such allowance under the Internal Revenue laws.

The next thing we must recall is that whenever you go down into the earth you get some kind of heat, but the kind of heat that you have to have in order to produce steam or use it for chemical processing or the other possibilities that come from geothermal energy, is the kind that comes in high densities. By that I means high temperatures and in localized areas. As we scan the map of the United States we find that geothermal energy's available surface area comes only in the seismic area, and that within the seismic areas which are largely centered in the Western portion of the United States, there are few, if any, evidence of large-scale opportunity for geothermal development.

In other words, the amount of development that we expect under the present technology is fairly limited. Therefore, the opportunity is very limited and as a consequence, those who enterprise in this area have that additional handicap in first obtaining the return of their investment, and second, a reasonable profit on top of that. And, I think, that the enterprisers, of course, they want to make a buck. That is a

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