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DOCUMENT

DEPARTMENT

U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 1977

99-374 O

COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE

HARLEY O. STAGGERS, West Virginia, Chairman JOHN E. MOSS, California

SAMUEL L. DEVINE, Ohio JOHN D. DINGELL, Michigan

JAMES T. BROYHILL, North Carolina PAUL G. ROGERS, Florida

TIM LEE CARTER, Kentucky LIONEL VAN DEERLIN, California

CLARENCE J. BROWN, Ohio FRED B. ROONEY, Pennsylvania

JOE SKUBITZ, Kansas JOHN M. MURPHY, New York

JAMES M. COLLINS, Texas DAVID E. SATTERFIELD III, Virginia

LOUIS FREY, JR., Florida BOB ECKHARDT, Texas

NORMAN F. LENT, New York RICHARDSON PREYER, North Carolina EDWARD R. MADIGAN, Illinois CHARLES J. CARNEY, Ohio

CARLOS J. MOORHEAD, California RALPH H. METCALFE, Illinois

MATTHEW J. RINALDO, New Jersey JAMES H. SCHEUER, New York

W. HENSON MOORE, Louisiana RICHARD L. OTTINGER, New York

DAVE STOCKMAN, Michigan
HENRY A. WAXMAN, California

MARC L. MARKS, Pennsylvania
ROBERT (BOB) KRUEGER, Texas
TIMOTHY E. WIRTH, Colorado
PHILIP R. SHARP, Indiana
JAMES J. FLORIO, New Jersey
ANTHONY TOBY MOFFETT, Connecticut
JIM SANTINI, Nevada
ANDREW MAGUIRE, New Jersey
MARTY A. RUSSO, Illinois
EDWARD J. MARKEY, Massachusetts
THOMAS A. LUKEN, Ohio
DOUG WALGREN, Pennsylvania
BOB GAMMAGE, Texas
ALBERT GORE, JR., Tennessee
BARBARA A. MIKULSKI, Maryland

W. E. WILLIAMSON, Chief Clerk and Staff Director
KENNETH J. PAINTER, First Assistant Clerk

ELEANOR A. DINKINS, Assistant Clerk

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

JOHN E. MOSS, California, Chairman JIM SANTINI, Nevada

JAMES M. COLLINS, Texas THOMAS A. LUKEN, Ohio

NORMAN F. LENT, New York DOUG WALGREN, Pennsylvania

MATTHEW J. RINALDO, New Jersey ALBERT GORE, JR., Tennessee

DAVE STOCKMAN, Michigan CHARLES J. CARNEY, Ohio

MARC L. MARKS, Pennsylvania JAMES H. SCHEUER, New York

SAMUEL L. DEVINE, Ohio (Ex Officio)
HENRY A. WAXMAN, California
PHILIP R. SHARP, Indiana
ANTHONY TOBY MOFFETT, Connecticut
ANDREW MAGUIRE, New Jersey
ROBERT (BOB) KRUEGER, Texas
HARLEY O. STAGGERS, West Virginia
(Ex Officio)

JOHN R. GALLOWAY, Energy Task Force Director
BENJAMIN M. SMETHURST, Special Assistant

RICHARD A. FRANDSEN, Counsel

JOHN MCELROY ATKISSON, Counsel to the Subcommittee

JAMES L. NELLIGAN, Operations Director

J. THOMAS GREENE, Counsel to the Chairman

BERNARD J. WUNDER, JR., Minority Counsel

(II)

CONTENTS

earings held on-

Page

October 13, 1977

1

October 14, 1977

45

October 17, 1977

181

estimony of

Alden, Edwin F., staff attorney, Washington Public Power Supply System,

Richland, Wash.

192

Burke, Daniel M., county prosecuting attorney, Natrona County, Casper,

Wyo

22

Constantine, Thomas J., counsel, Fremont Energy Corp., Denver,

Colo

49, 128, 143

Flanagan, Phillip E., president, General Nuclear Corp., Riverton, Wyo. 29

Galloway, John R., Director, Energy Task Force, Subcommittee on Over-

sight and Investigations, Committee on Interstate and Foreign Com-

46

Gibson, E. L., Jena, La

107

Humble, Omer, chief landman, Minerals Department, Exxon Co., U.S.A.,

Denver, Colo.

216

Johnson, Larry, foreman, Natrona Service Inc., Casper, Wyo

2

Laub, Donald C., senior geologist, Phillips Petroleum Co., Casper, Wyo 182

MacGuire, John W., Natrona Service, Inc., Casper, Wyo

2

Murphy, William J., president, Fremont Energy Corp., Denver, Colo

143

Roncalio, Hon. Teno, a Representative in Congress from the State of

Wyoming

48

Schauss, Ralph L., chairman of the board, Fremont Energy Corp., Denver,

Colo..

49,128

Whitworth, Brian, counsel, Phillips Petroleum Co., Casper, Wyo.......... 182

Smethurst, Benjamin, special assistant, Subcommittee on Oversight and

Investigations, Committee on Interstate and Foreign Commerce

40

Wills, Elizabeth, counsel, General Nuclear Corp., Riverton, Wyo.....

29

Additional material submitted for the record by-

Exxon Co., U.S.A., letter dated October 24, 1977, from Omer R. Humble to

Chairman Moss re report in files regarding a field examination of the

Casper claims

225

Fremont Energy Corp., Denver, Colo.:

Contract dated September 1, 1969, between Mr. Schauss and Mr. E.

L. Gibson

139

Letter to shareholders dated October 31, 1972, which makes general

reference to historical expenditures by Petro-Nuclear Inc., and

others in the five western States .....

172

General Nuclear Corp., letter dated February 9, 1978, from D. Elizabeth

Wills to Chairman Moss re gross revenues of General Nuclear Corp 35

Oversight and Investigations Šubcommittee, Committee on Interstate and

Foreign Commerce:

Assessment work affidavit dated December 14, 1972, by E. L. Gibson .. 118

Assessment work affidavit dated August 26, 1977, by Phillip E. Flana-

gan

32

Corporation reports of Whiskey Gap Mining Co., Inc., and Crazy

Woman Creek Mining Co., Inc

94

Exhibit 1-18 validly staked mining claims in Wyoming showing four

corner and two side center stakes, plus discovery monuments .... 110

Exhibit II—18 invalidly staked mining claims in Red Desert Area,

Wyoming showing only two corner stakes plus discovery monu-

ments-two corner and two side center stakes missing.

112

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Page

77

227

152

165

163

157

Additional material submitted for the record by-Continued
Oversight and Investigations Subcommittee Continued

Findings of fact and conclusions of law, U.S. District Court for the

District of Wyoming, Civil Action File No. 5577, Securities and
Exchange Commission, plaintiff v. Pollution Control and Engineer-

ing Corp., et al, defendants, filed June 10, 1971
Letter dated May 20, 1977, from Philip Flanagan, president, General

Nuclear Corp., to Les Burkett, Exxon Corp., re assessment work on

Gasper group of uranium claims
Letter dated September 22, 1977, from Chairman Moss to J. P. Keehan,

manager, other minerals, Mobil Oil Corp. re exploratory drilling
and/or improvement work on lode mining claims, with a reply dated

September 30, 1977..
Letter dated September 30, 1977, from W. R. Moran, vice president and

general manager, Minerals Exploration Co. re information with
respect to unpatented mining claims in the Red Desert Area of

Sweetwater and Fremont Counties, Wyo.........
Letter dated November 2, 1977, from Chairman Moss to Don A.

Nichols, division minerals landman, Getty Oil Co. re Fremont En-
ergy Corp: cost estimates of assessment work performed on certain
uranium lode mining claims in the Red Desert Area of Wyoming,

with reply dated November 10, 1977
Letter dated November 3, 1977, from Chairman Moss to J. P. Keehan,

general manager, energy minerals, Mobil Oil Corp. re Fremont
Energy Corp. cost estimates of assessment work performed on cer-
tain uranium lode mining claims in the Red Desert Area of Wyo

ming, with reply dated November 4, 1977
Letter dated November 2, 1977, from Chairman Moss to W. R. Moran,

vice president and general manager, Minerals Exploration Co., re
Fremont Energy Corp. cost estimates of assessment work performed
on certain uranium lode mining claims in the Red Desert Area of
Wyoming, with reply dated November 14, 1977..
List of General Nuclear/Flanagan claims for which assessment affida-

vits have been filed for 1977
Map (re Mr. Schauss's testimony).
Memorandums dated April 23, 1976, and July 6, 1976, from G. L. Bale

to D. B. Trubey (Kerr-McGee Corp.) re surveillance report on Na-

trona Service
Memorandum dated December 16, 1977, from Stephen F. Sims,

Special Assistant, to Chairman Moss re report on salting of Snake

Eye uranium claims
Portion of map reproduced from the records of Exxon Co., U.S.A
Proof of labor affidavit dated August 24, 1972, by E. L. Gibson of

Western Exploration Co...
Proof of labor affidavit dated August 24, 1974, by Ralph Schauss (Crazy

Woman Creek Mining Co.)......
Proof of labor affidavit dated August 24, 1974, by Ralph Schauss

(Poison Spider Mining Co.)
Proof of labor affidavit dated August 22, 1973, by Ralph Schauss

(Western Exploration Co.)
Proof of labor affidavit dated August 24, 1974, by Ralph Schauss

(Whiskey Gap Mining Co.)..
Red Desert assessment work sheets and canceled checks written by

Ralph L. Schauss
Response of William J. Murphy, president, Fremont Energy

Corp. to subpoena of September 7, 1977, issued by the chairman of
the Interstate and Foreign Commerce Committee of the U.S. House

of Representatives
Telex's dated September 29, 1977, and October 4, 1977, from Getty Oil

Co., to Chairman Moss re uranium exploration activities in Red

Desert Area of Wyoming.
Unpatented Mining Claims—Labor Assessment Requirements, Public

Law 85-876; 72 Stat. 1701

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Appendix:

Exploration of PCEC's West Red Desert Uranium Prospect, by Richard A.

Fruchey, consulting geologist, May 23, 1975

Letter dated July 27, 1976, from W.J. Murphy, president, Fremont Energy

Corp., to Washington Public Power Supply

Letter dated December 3, 1976, from Sy Jaye, vice-president, general

manager, utilities division, S. M. Stoller Corp., to Gordon T. Austin,

senior fuel resource engineer, Washington Public Power Supply

System

Letter dated February 18, 1977, from Wehrli and Williams, attorneys, to

Edwin F. Alden, attorney, Washington Public Power Supply System,

with opinion letter dated February 16, 1977,

attached

Memorandum dated March 24, 1977, from E. F. Alden to D. L. Renberger

(Washington Public Power Supply System) re Fremont Energy contracts,

with letter dated March 21, 1977, from Wehrli and Williams, attorneys

attached.....

Memorandum dated April 5, 1977, from E. F. Alden to D. L. Renberger

(Washington Public Power Supply System) re Fremont Energy Corp.

contracts, with proof of labor affidavit dated January 25, 1977,

attached.....

Letter dated January 20, 1977, from James R. Learned, attorney, to

Fremont Energy Corp., re title opinion lode mining claims, Sweetwater

County, Wyo

Letter dated November 1, 1977, from Edwin F. Alden, staff attorney,

Washington Public Power Supply System, to Chairman Moss with sup-

plemental statement attached.

Letter dated October 8, 1973, from Robert P. Schuster, attorney, to Tom

Constantine, attorney, re information regarding Elmer Gibson's claims

against Ralph Schauss

Correspondence between John W. MacGuire, president, Natrona Service,

Inc., and Gulf Oil Corp., re overstaked claims in the “Bow” group of

claims...

Letter dated November 8, 1977, from Chairman Moss to Hon. Harold M.

Williams, Chairman, Securities and Exchange Commission re uranium
claimstaking practices in the Western States, with reply dated November

15, 1977 ...
U.S. Statutes at Large, volume 17, 42d Congress, 2d Session, chapter 152,

1872.

Public Law 94-579 (S. 507); October 21, 1976—Federal Land Policy and

Management Act of 1976

Title 30-Mines and Minerals, Wyoming Statutes..

Findings of Fact and Conclusions of Law, in the U.S. District Court for the

District of Wyoming, John W. MacGuire, plaintiff, v. Roy R. Sturgis,

Cotter Corp., a New Mexico corporation, and Arthur R. Thayer, defend-

ants; Continental Oil Co., a Delaware corporation, Natrona Service, Inc.,

a Wyoming corporation, Ray Allemand and Allemand, Inc., a Wyoming

corporation, additional defendants on counterclaim-Civil No. 5523

Statement of Elmer L. Gibson, made to Richard A. Frandsen and Benjamin

M. Smethurst, September 28, 1977

Statement of Ralph L. Schauss dated November 17, 1977

315

317

328

340

343

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