HISTOEY AND LEGAL BASIS. 47 



reservoir sites in public ownership pending appropriate legislation 

 by Congress without in any way retarding agricultural development. 

 Bills have already been introduced applying this principle to oil in 

 other States than Utah and to phosphate in the State of Idaho. It 

 is to be hoped that such bills will be passed and approved, or, better 

 still, that a comprehensive act providing for the separation of the 

 various estates will be introduced and enacted. 



Nearly every student of the situation is agreed that the leasing 

 system is far better than any other for disposing of natural re- 

 sources. This conclusion is based partly on the logic of theoretical 

 considerations, partly on the experience of other countries, such as 

 the Australasian States, and partly on the fact that the leasing system 

 IS rapidly replacing all others in commercial practice in the United 

 States. A single instance may be cited : Over 90 per cent of the oil 

 production of the United States in 1911 came from leased lands. In 

 the public interest leasing is to be preferred to sale for several reasons. 

 In the first place, the sale of mineral lands at appraised values 

 per acre presents problems of great diificulty and of uncertain solu- 

 tion, because of the number of factors involved. For example, in 

 valuing coal lands under the present coal-land law or in valuing 

 phosphate lands, should a similar law be enacted for that mineral, 

 the items bearing on the value which should be fixed are so numer- 

 ous, so difiicult to estimate, and so variable that it is well-nigh im- 

 possible to arrive at conclusions which give the proper weight to all 

 the factors involved. In valuing coal lands the end striven for has 

 been to fix prices which shall be low enough to permit purchases for 

 immediate development but which shall be high enough to prohibit 

 speculative purchases or long-term investments. However, the 

 proper consideration of transportation charges, market conditions, 

 competing supply, and cost of labor is affected by so much uncertainty 

 that it is difficult to fix a thoroughly satisfactory price for which 

 lands should now be sold. When it is considered that the lands are to 

 be sold in the indefinite future at the prices fixed nowj the difficulties 

 of the task become apparent. None of these difficulties would attend 

 in the same degree the administration of a lease law under which 

 the coal or phosphate would be paid for at a royalty per ton as 

 mined. The fixing of the royalty would be very much simpler than 

 the present task. 



Attention has already been called to the inappropriateness of sell- 

 ing oil and gas by the acre. The distance within which oil and gas 

 may be drawn off by a single well is not definitely known and is, of 

 course, variable, but it is at least certain that a well drilled close to 

 a property line will draw these minerals from immediately adjoining 

 portions of neighboring tracts. Under a leasing law the person re- 

 quired to pay for deposits of these minerals would not be the person 



