Executive Order 7758—Constituting Designated Area, and Establishing Federal Tender Board No. 1

By virtue of and pursuant to the authority vested in me by the Act of Congress entitled "An Act To regulate interstate and foreign commerce in petroleum and its products by prohibiting the shipment in such commerce of petroleum and its products produced in violation of State law, and for other purposes", approved February 22, 1935, (49 Stat. 30), as amended by the Act of June 14, 1937, (Public No. 145—75th Congress, 1st Session) , hereinafter referred to as said Act, and the Executive Order of the President of the United States, No. 6979, of February 28, 1935, and Executive Order No. 7756, this date promulgated; and

Whereas, when, by Executive Order No. 6980-C approved March 1, 1935, I designated the area known as the East Texas Field and appointed Federal Tender Board No. 1 for the purpose of issuing certificates of clearance for said Field and administering the regulations prescribed under said Act, I found that large quantities of contraband oil were originating in and being shipped and transported in interstate commerce from said Field; that actual production of petroleum in said Field was in excess of the amounts permitted to be produced under the Laws of the State of Texas and under the regulations and orders prescribed thereunder by the Railroad Commission of Texas, a substantial part of which moved in interstate commerce; that large quantities of contraband oil, a substantial part of which was available immediately for interstate transportation, were actually situated in said Field; and that various devices and operations had been and were being used in said Field to obstruct the enforcement of the Conservation Laws of the State of Texas and the orders thereunder of the Railroad Commission of Texas, all of which resulted in conditions which were wasteful and conducive to a decreased ultimate recovery of oil from said Field; and

Whereas, I find the operations of said Board in said Field have assisted materially in the enforcement of the Conservation Laws of the State of Texas and the orders thereunder of the Railroad Commission of Texas, have prevented the movement of contraband oil from said Field in interstate commerce, and have aided materially in the establishment of conditions which will result in a material increase in the ultimate recovery of petroleum from said Field, the benefit of which will accrue to the interest of the public, the State of Texas, and the United States of America; and

Whereas, I find that the potential production of petroleum in said East Texas Field continues to be and is at this time greatly in excess of the production currently permitted by the Conservation Laws of the State of Texas and the orders thereunder of the Railroad Commission of Texas; that the actual production of petroleum in said East Texas Field is approximately fourteen per cent of the total actual production of petroleum in the United States and is equal approximately to the aggregate production of the States of Kansas, Louisiana and New Mexico; that the estimated reserve of recoverable petroleum in said Field comprises approximately one-fourth of the estimated reserves of recoverable petroleum from all of the presently known fields of the United States; that there are in said Field more than 22,000 oil wells, a substantial proportion of which are capable of producing at this time quantities of petroleum greatly in excess of the amounts currently allowed to be produced by the Conservation Laws of the State of Texas and the orders thereunder of the Railroad Commission of Texas; that there is in said Field equipment, including numerous refineries, reclamation plants, casinghead gasoline plants, gathering systems, storage facilities, field and trunk pipe lines, loading racks, railroads, and tank trucks, which would make possible the immediate shipment in interstate commerce of quantities of petroleum and petroleum products greatly in excess of the quantity of petroleum currently allowed to be produced by the Conservation Laws of the State of Texas and the orders thereunder of the Railroad Commission of Texas; that such production in violation of said State Laws and orders would result in a material loss and wasteful use of the reservoir energy in said Field and in a substantial decrease in the amount of petroleum ultimately to be recovered from said Field, to the detriment of the public, the State of Texas and the United States of America; that there is actually situated in said Field at this time large quantities of contraband oil, a substantial part of which is available immediately for transportation in interstate and foreign commerce; and that bypasses and other devices and operations that have been used to obstruct the enforcement of the Conservation Laws of the State of Texas and the orders thereunder of the Ballroad Commission of Texas could again be used immediately in the violation of said State Laws and Orders; and

Whereas, I found that it was necessary and appropriate for the enforcement of the provisions of said Act to require certificates of clearance for petroleum and petroleum products moving or to be moved in interstate commerce from said East Texas Field and to establish a Board for the issuance of such certificates, I now find that it is necessary and appropriate to continue to require certificates of clearance for petroleum and petroleum products moving or to be moved in interstate commerce from said East Texas Field and to continue to maintain a Board for the issuance of such certificates;

Now, Therefore, it is ordered:

Article I

That part of the State of Texas included within the Counties of Gregg, Upshur, Smith, Rusk, and that part of Cherokee Comity covered by the Miguel de los Santos Coy, Pratt and Wesley Dikes Surveys (to be known as the East Texas Field) is hereby constituted a designated area within the meaning of Regulation n of Executive Order No. 7757, and the regulations prescribed by said Order shall apply to all petroleum and petroleum products in or from said area and to all persons producing, refining, processing, manufacturing, storing, shipping or transporting petroleum or petroleum products in or from said area.

Article II

I hereby establish a Board to be known as Federal Tender Board No. 1, for the purpose of issuing certificates of clearance for such area under said Act and administering the regulations prescribed under said Act. Such Board shall consist of one or more persons who shall be appointed by the Secretary of the Interior and shall serve at his pleasure. The principal office of Federal Tender Board No. 1 shall be located at Kilgore, Texas.

Article III

Applications to Federal Tender Board No. 1 for certificates of clearance, supporting affidavits for said applications, and returns relative thereto shall be made on forms in accordance with instructions prescribed and approved by the Secretary of the Interior and appearing thereon.

Article IV

Monthly reports by refineries, reclamation plants, casinghead gasoline plants, pipe lines and producers operating in the East Texas Field shall be made on forms in accordance with instructions prescribed and approved by the Secretary of the Interior and appearing thereon.

Article V

The operation of this order shall be immediately effective.

Approved, prescribed and promulgated this 6th day of October, 1937.

     HAROLD L. ICKES,
Secretary of the Interior.

Approved:

FRANKLIN D ROOSEVELT

The White House,
December 1, 1937.