Mr. MACK. What is the size of this Reynolds Metal plant? What is the capacity?

Colonel MILNE. I do not know, but there is a gentleman here who can give you that information.

Mr. MACK. It is an aluminum plant?

Colonel MILNE. Yes, sir.

Mr. MACK. What is the energy used to smelt the bauxite? Is it gas or electricity?

Colonel MILNE. It is gas.

Mr. MACK. Is there an available supply of gas there for increasing the capacity of the plant at a later date?

Colonel MILNE. Yes, sir.

Mr. MACK. The Federal Government is the largest consumer of aluminum, I think. They use a larger proportion of the output directly or indirectly, I believe.

Colonel MILNE. I would imagine that the Federal Government is one of the very good customers. Yes, sir.

Mr. NEAL. In what capacity does the General Services Administration use this project?

Colonel MILNE. It is my understanding that in their capacity as the procurer of strategic metals, and the stockpiling of strategic metals, they are engaged in a nationwide program of stockpiling. One of the areas where they are stockpiling is somewhere along this channel. They have been utilizing this channel since its completion.

Mr. ANGELL. When the Reynolds Metals Co. constructed this project was it anticipated by them that the Federal Government would later share in its construction?

Colonel MILNE. When it was initially recommended it was to be on a 50-50 participation basis. When Reynolds went in along with the Nueces Navigation District there was no understanding that the Federal Government would share in the cost. They realized it would take specific legislation to be reimbursed.

Mr. ANGELL. The committee has been approached on several occasions by advocates of projects to go on record that they would reimburse local interests for completing projects that were constructed according to Government plans, if the local interests would go ahead and complete the construction. But the committee has refused to do that in view of the fact that the Government would be embarking on a new program, and one that might entail pretty heavy expenditures on the part of the Federal Government.

Colonel MILNE. I think those generally, Mr. Chairman, are in connection with projects that are authorized by the Congress, but for which money has not been appropriated. Local interests have sometimes requested authority to advance the money for the completion of those projects.

In this particular case the project was not authorized when local interests went ahead and did their own work. I am sure they understood that in order to secure any reimbursement it would require specific legislation. The authorization of this project, in my opinion, would not permit reimbursement.

Mr. ANGELL. Are there any further questions of Colonel Milne? (No response.)

Mr. Angell. If not, we thank you, Colonel Milne, for your statement.

Are there any further witnesses to be heard on this project?

You are Mr. Duane Orr?

STATEMENT OF DUANE ORR, DISTRICT ENGINEER, NUECES COUNTY NAVIGATION DISTRICT, CORPUS CHRISTI, TEX.

Mr. ORR. Yes, sir.

Mr. ANGELL. Will you give your name to the committee and the reporter, and we will be very happy to hear you, sir.

Mr. ORR. Gentlemen of the subcommittee, my name is Duane Orr. I am district engineer of the Nueces County Navigation District, in whose district the LaQuinta Branch Channel of the Port AransasCorpus Christi Waterway is located.

Mr. ANGELL. Before you proceed further, may the Chair make a statement?

I have been advised that the full committee is to meet here on an important matter at a quarter to twelve, so that we have only threequarters of an hour to complete this project and the next project, if we can do so. If you and the other gentlemen will cooperate with the committee as far as you reasonably can and still cover your projects we will be happy to have you do so. You may file any statements you may have and hit the high points if you so desire.

Mr. ORR. I will be happy to comply with your request. I would like to clarify a few points in the beginning.

First, Colonel Milne made reference to this $1,292,000 that the local interests are contributing toward the project. For your information and clarification, gentlemen, I would like to point out of this $1,292,000 over half a million, or $500,000, was put up by the Nueces County Navigation District, using public tax funds from the people and taxpayers of Nueces County.

Certainly we have no thought that we will be reimbursed by the Federal Government either now or at any time in the future for our contribution toward this project. We feel it is sufficiently justified from the standpoint of national defense, as well as from the local interests standpoint, for us to put up this contribution for helping the Federal Government on the project. All we are asking is at this time that the Federal Government assume the maintenance of the project and adopt the project, as recommended by the Chief of Engineers in his report, which has been further discussed with you. I would like to point out a few more recent developments which will show you gentlemen that this is not a one-purpose channel, but is a multiple-purpose channel.

The bay route has long been discarded as the location of this channel, as mentioned. This short channel shown in green was the channel dredged by local interests on the alinement recommended by the Corps of Engineers. This channel is 5.67 miles long. It was dredged to a depth of 32 feet. We dredged it to a width of 175 feet on all except 21/4 miles of this distance. In other words, around the curves here and as it approaches the turning basin we dredged it to a minimum of 175 feet. Through this straightaway here we dredged that to 125 feet. That is the section we would like to have authorized at 150 feet, so that it can be widened at some future date.

Mr. ANGELL. The additional cost, as reported by Colonel Milne, would not be too excessive, but would be around $100,000.

Mr. ORR. It certainly would not exceed more than that, and I think it would run substantially less when handled with a maintenance contract. When this channel was dredged we placed spoil along here and made a continuous spoil bank. This being pretty heavy clay, we obtained quite a spoil bank from that. In recent months there has developed a large oilfield in this area. In that the navigation district, on the submerged land which was acquired by the State of Texas, has leased a portion of the spoil disposal area to the Sun Oil Co. and the Austral Oil Exploration Co., who have now constructed a tank farm on the spoil bank and started moving petroleum products from here. They have constructed a dock and a channel leading off this over to their terminal site.

The Arkansas Fuel Oil Co., has also requested the tank commission to negotiate a lease and will also construct tankage on this spoil bank, which will move over the channel. In other words, there are 3 additional oil companies that have moved petroleum or, rather, 2 of them have moved petroleum and in a few short months a third company will be moving petroleum out here, using this channel.

In addition, we have under construction by local interests, which will be completed in the next 2 weeks, a small, shallow-draft channel extending from here up to this little area here, which is known as Kinney Bayou. This channel some mile and a half long goes back into high ground there, with a bluff on three sides ideally situated for a harbor, and also as a base of operations not only for the development of the extensive oilfields throughout Corpus Christi Bay, but also for the development of oil and a well-drilling program beginning in the Gulf of Mexico.

In other words, this is the closest site to the Gulf of Mexico that has rail facilities nearby and a highway and fresh water, and all of the other facilities needed to develop this offshore drilling program.

Mr. ANGELL. Are there developed gas and oil fields in that vicinity? Mr. ORR. Yes, sir. There is a very large oil field out in here which was a recent discovery. When you get back into Corpus Christi Bay most any place you look there is an oilfield. In some places there there are as many as 10 sands underneath. The only restriction to full development of Corpus Christi Bay for an oilfield is that the naval air station has quite large areas reserved for landing fields and for their aircraft, and of course that is all restricted to drilling.

Mr. ANGELL. The other projects are under the bay?

Mr. ORR. That is right. And there is a very extensive gas field that has hardly been tapped. They have only drilled enough holes to determine the extent of it.

Mr. ANGELL. Is it a possibility for the Reynolds Metals Co. to develop, through the use of gas, their plant sufficiently to meet the competitive prices of hydroelectric power?

Mr. ORR. I understand that they have been able to compete favorably with the unit cost of hydroelectric power there, based on the fact of the reduced cost of getting the bauxite over to there.

Mr. ANGELL. Is the hydroelectric power there?

Mr. ORR. There is no hydrolectric power in that area, but I mean other areas where the power is available.

Mr. ANGELL. Do you think it is competitive in price with the hydroelectric power in the Columbia River Basin?

Mr. ORR. Reasonably close.

Mr. ANGELL. As you know the Reynolds Metals Co. has a plant in my district also.

Mr. ORR. Yes. But they have acquired a large gas deposit there which will run for some number of years.

I would like to point out that the navigation district, which is the public body charged with the responsibility of waterway projects within its boundaries which are coextensive with the boundaries of Nueces County, is ready to furnish all the necessary rights-of-way and hold the Federal Government harmless, as well as the usual provisions which we are fully familiar with.

Since this channel was actually completed on March 25, 1953, the Reynolds Metals Co. has constructed a large dock for the handling of inbound movements of bauxite ore, and outbound movements of petroleum products and general stores, and aluminum billets and ingots. That dock has been in almost continuous operation since it was completed on March 29. Since then, as I mentioned earlier, the Sun Oil Co. in conjunction with the Austral Oil Co. have constructed a dock there and are using the channel regularly. They completed their dock on January 9, 1954. So it has only been in operation a very short time. Between March 29, 1953, and February 15, 1954, a period of about 1012 months, there has moved over this channel a total of 607,106 tons of bauxite ore.

Mr. ANGELL. That ore went into the Reynolds plant?

Mr. ORR. It all went in this general area.

Mr. ANGELL. It all went to the Reynolds plant?

Mr. ORR., No. Part of that is General Services Administration bauxite ore which they are stockpiling there.

Mr. ANGELL. What proportion went to the General Services Administration?

Mr. ORR. I believe that is classified and we do not have the proportion. But it is set out, and can be obtained, I am sure, for the committee's use.

In addition to that there has been shipped over the Reynolds docks some 7,295 tons of petroleum products, 3,768 tons of pig and bar aluminum, and they have received 21,271 tons of petroleum products at that dock.

The Sun Oil Co. and Austral Oil Co. dock have between January 9 and February 17 shipped 13,505 barrels of petroleum products.

There has been an extensive use of this waterway not only for the production of this tonnage which I previously mentioned, but for the equipment to move in that area to the development of the oil fields. In other words, in a period of 10 months we have positive records of some 10,000 vessels using this channel. That does not include the fishing and shrimp boats that now dock in that area and go and come from the Gulf of Mexico.

Mr. ANGELL. Mr. Orr, would it be agreeable to you to submit the balance of your statement for the record?

Mr. ORR. Yes, sir. I would just mention one thing. There are 4,900 acres of highly undeveloped land adjacent to this channel, which sites are ideally situated from the standpoint of national defense and for

industrial development. We have numerous inquiries from day to day on these industries wishing to locate there.

As mentioned earlier, the local interests spent $1,292,000 toward the construction of this project, and we respectfully suggest that this be considered and taken over as a Federal project, and authorized to the 150-foot width, as mentioned earlier.

Mr. ANGELL. Thank you, Mr. Orr, for your very comprehensive statement, and your full statement will be included in the record at this point, without objection.

(The prepared statement of Mr. Orr is as follows.)

STATEMENT OF DUANE ORR, DISTRICT ENGINEER, NUECES COUNTY
NAVIGATION DISTRICT, CORPUS CHRISTI, TEX.

Mr. Chairman and gentlemen of the subcommittee, my name is Duane Orr, and I am district engineer of the Nueces County Navigation District in whose district the LaQuinta Branch Channel of the Port Aransas-Corpus Christi Waterway is located. I appear before you today requesting that the LaQuinta Branch Channel of the Port Aransas-Corpus Christi Waterway be authorized as a Federal project. This navigation district is ready to furnish to the United States of America all rights-of-way necessary for dredging and spoil disposal and to hold the Government harmless from claims for damages caused by any widening, deepening, and/or maintaining the channel. To expedite this project, local interests have at a cost of $1,292,437 acquired the right-of-way, dredged a channel 32 feet deep, 125 feet wide, and 5.67 miles long, with a turning basin at LaQuinta, and constructed the necessary aids to navigation. This channel was dredged along the alinement recommended by the Corps of Engineers in House Document No. 89, 83d Congress, 1st session, and the project fully meets all requirements of the engineers.

It is the purpose of this statement to show that the LaQuinta Channel, a branch channel of the Port Aransas-Corpus Christi Waterway which is fully described in House Document No. 89, 83d Congress, 1st session, is of sufficient importance to the national defense to justify its being authorized as a Federal project and maintained by the Corps of Engineers.

The LaQuinta Channel, which is located along the north shore of Corpus Christi Bay between Port Aransas and Corpus Christi, Tex., extends northwesterly from the passing place on the Port Aransas-Corpus Christi Waterway opposite Old Ingleside along the north shore of Corpus Christi Bay to a turning basin located near LaQuinta. The Corps of Engineers recommended in their report that the channel be authorized to a depth of 32 feet and to a minimum bottom width of 150 feet except on the curves where they recommended a minimum bottom width of 175 feet.

The report on this project was transmitted to the House of Representatives by letter from the Secretary of Defense on February 11, 1953; however, no action was taken by Congress on the project during the previous session. Because Congress did not consider this project and did not provide funds for its construction during the last session, local interests found it necessary to dredge the channel with local funds so that vitally needed bauxite ore could be received by water from foreign sources and processed into aluminum. To meet their immediate needs local interests dredged a deep-sea channel and turning basin to a depth of 32 feet along the alinement recommended by the Chief of Engineers in the report which is now being considered by your committee, the Rivers and Harbors Subcommittee of the House Public Works Committee.

The channel was dredged to a bottom width of 175 feet, except between stations 120+00 and 238+00, which section, because it was on a tangent, was dredged to a bottom width of 125 feet. The turning basin was dredged to the same depth as the channel and to the dimensions recommended in the Corps of Engineers' report. The dredging of this channel required the removal of 6,685,816 cubic yards of material at a cost of $1,216,558, while navigation aids, right-of-way, engineering and legal fees cost an additional $75,879. Based on these figures local interests have contributed $1.292,437 to date toward this project, which contribution far exceeds the recommendation of the Chief of Engineers that local interests bear one-half the cost of the project or approximately $795,000.