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Show 744 HISTORY OF PUBLIC LAND LAW DEVELOPMENT one claimant. In the naval reserves, leases were given only on producing wells, unless the President in his discretion chose to lease the remainder. It is not known how many leases were eventually granted by the government under the relief provisions. It is doubtful that there were as many as the 10-year controversy would seem to have warranted. It is said that Standard Oil of California, at least, was eligible for leases on 1,400 acres outside the naval reserves and to wells on 960 acres inside Reserve No. 2. The company's claims were sold very shortly after the enactment of the new statute.828 The problem of alien ownership-described by Professor Ise as a "delicate and baffling question"329-was discussed at length in both Houses of Congress. Great Britain's international oil policy at this time was quite openly criticized,830 and many legislators feared that retaliatory action would be taken by Mexico.831 "Open door" abroad and "closed door" at home, Ise points out, created what was obviously an impossible dilemma for most Congressmen. Eventually, a compromise based on the notion of reciprocity was reached in the 1920 Act: aliens were prohibited from owning interests in leases either directly, or indirectly through stock, only if they were nationals of countries which prohibit similar ownership by Americans.832 The allocation of a portion of the royalties to the states in which the public lands are located has always been a controversial issue. The Smoot bill in the Senate had been generous to the states. (The dis- m See White, supra note 229, at 459. sa> See Ise, supra note 228, at 347. »°58 Cong. Rec. 7513-15, 7529 (1919). "* In 1921, it is estimated that British and American oil investments in Mexico amounted to at least $300 million. Engler, The Politics of Oil: Private Power & Democratic Directions 193 (1961) (Phoenix ed. 1967). » 30 U.S.C g 181 (1964 ed.). tribution, it will be remembered, was 45 percent to the states, 45 percent to the Reclamation Fund, and 10 percent to the Federal government.) This was not surprising since the Public Lands Committee consisted largely of westerners. The matter of apportionment was debated more extensively in the House than in the Senate. At the outset, it appeared that there were royalties due on something like $20 million of oil produced in the past on land which was within the relief provisions of the new act. Representative Sinnot of Oregon suggested that this fund be distributed: 10 percent to the Federal government, 70 percent to the Reclamation Fund, 20 percent to the states in which the lands were located.333 After the chairman's ruling that Sinnot's motion was not germane because the bill contemplated only the distribution of future royalties, Representative Ferris of Oklahoma moved a substitute amendment which would authorize all royalties to be paid into the Reclamation Fund.334 This apparently had been the recommendation of the administration. The Ferris amendment was eventually withdrawn for lack of support. The conference committee of the two Houses finally worked out a compromise which became part of the new law; 521/2 percent to the Reclamation Fund; 371/2 percent to the states in which the lands are located for education and roads; 10 percent to the Federal Treasury.885 It would be inappropriate here to outline the detailed provisions relating to oil and gas in the Leasing Act as it was finally adopted on February 25, 1920. The basic format was essentially the same as the Smoot bill. The House eliminated the provision for maximum royalties on leases, cut down the relief provisions, permitted more extensive ownership by aliens, and modified the apportionment of royalties be- 338 58 Cong. Rec. 7649, 7771 (1919). 884 58 Cong. Rec. 7651, 7652 (1919). 886 30 U.S.C. § 191 (1964 ed.). |