pose of exploring for, developing, removing, and transporting resources therefrom, to the same extent as if the outer continental shelf were an area of exclusive Federal jurisdiction located within a State." The Outer Continental Shelf Lands Act makes the civil and criminal laws of each adjacent State, except State taxation laws, the law of the United States for that portion of the subsoil and seabed of the outer continental shelf, and artificial islands and fixed structures, which would be within the area of the State if its boundaries were extended seaward to the outer margin of the Shelf. The authority of the Secretary of the Army to prevent obstruction to navigation in navigable waters of the United States is extended to artificial islands and fixed structures located on the outer continental shelf."

4. High seas-As used here to define the fourth division of the ocean, high seas refers to waters seaward of the outer boundary of the continental shelf.

Mineral resources

The Federal Government operations in these areas are designed to develop facts and identify national needs. The problem connected with the production of wealth of the sea becomes more complex as the search progresses farther from the coast into the deeper areas. Mining for marine minerals and chemicals follows a pattern set in land mining. Locate a deposit. Characterize it in sufficient detail that the technology required for production can be determined and the estimate of the profitability of exploitation will inspire confidence. Finally, design the production system and development for mining the product.

Under the exploration program for the discovery of minerals,10 the Secretary of the Interior exercises his authority through the Director of the Geological Survey.11

11

The Geological Survey was created to classify public lands and examine the geological structure, mineral resources and products of the national domain.12 This authority was expanded in 1962, to include examination outside the national domain.13

The Survey performs a variety of functions that relate to finding new mineral deposits and in appraising mineral resources potential. These include: Field and laboratory research on mineral occurrences to establish principles to guide prospecting; preparation of geologic maps at various scales and of varying scope and area to provide the background framework for selecting areas favorable for mineral occurrences; stratigraphic studies both on the surface and in the subsurface for evaluating mineral fuels resources; geochemical and geophysical studies both locally and regionally to appraise potential resources and to define favorable ground; development of new techniques and refining of prospecting tools and methods; and summary studies and evaluation of total resources potential both inside and outside the national domain. Recent investigations in Carlin, Nev., led to the largest new gold discovery in recent years, and delineation of buried sedimentary basins in the Bering Sea has led to major finds by oil companies.

743 U.S.C. 1333 (a) (1), p. 96. 843 U.S.C. 1333 (a) (2), p. 96. 33 U.S.C. 403 et seq., p.67.

10 30 U.S.C. 641-643, p. 94.

11 DM 3. 1.

12 43 U.S.C. 31. p. 94.

13 43 U.S.C. 31 (b), p. 94.

The Survey issues permits and enforces regulations for exploration of the leased and unleased submerged lands of the outer continental shelf. Such operations are authorized by section 11 of the Outer Continental Shelf Lands Act of August 7, 1953.14 The Survey also supervises all oil, gas, and sulfur exploratory, development, and producing operations on leased lands in accordance with departmental regulations. Another Survey function is the determination and collection of rentals and royalties. The Survey also conducts geologic and engineering studies of the mineral resources of the outer continental shelf in support of mineral leasing and supervision. The data developed provides technical input for lease sale planning and the determination of fair market value of tracts offered for mineral leasing.

Under its responsibility for archiving marine minerals, the Smithsonian Institution studies, retains, and lends for study samples of many types of minerals, including manganese nodules, to industry and governmental groups desiring them. The resources of the Institution are used in performing laboratory studies of such minerals.15

The Bureau of Land Management using geologic and engineering advice and services of the Geological Survey, performs functions concerned with the identification, classification, and the development, conservation, protection, and utilization of the natural resources on public lands and the mineral resources on certain acquired lands.

Under the mining and leasing laws 17 the Bureau administers a program of development, conservation, and utilization of mineral resources through the leasing of minerals on public lands and on lands in other ownership on which the mineral rights are federally owned and through the issuance of mineral patents and other instruments relating to mineral resource development. The Director is authorized to exercise the program authority of the Secretary of the Interior with respect to the management of the submerged lands of the outer continental shelf under its jurisdiction, including all associated functions which relate thereto.18

The Bureau of Mines cooperates with the Geological Survey in the search for new and underdeveloped areas of mineralization, by appraising them technically and economically to see if advances in extractive techniques and processing methods will provide incentives for industrial development. For the basic authority under which the Bureau of Mines operates specifically authorizes inquiries into the technological, scientific, and economic factors that affect the mineral industries.19

Mineral deposits vary in size, shape, quality, depth, and physical characteristics. Separation and removal of a mineral from its natural environment involves a complex series of interrelated acts or systems. The Bureau of Mines participation in marine mining is the engineering problem of adapting known principles and technologies to a marine environment to demonstrate that it is economically feasible to extract minerals from seabed deposits.

14 43 U.S.C. 1331, p. 96. 15 20 U.S.C. 59, p. 137. 18 30 U.S.C. 181, p. 94. 17 30 U.S.C.

18 DM 235.1. Certain limitations on the Director's authority are specified herein.

19 30 U.S.C. 3, p. 94.

In its Marine Mineral Technology Center at Tiburon, Calif., the Bureau is developing and testing new equipment and techniques in a drill test tank that simulates the ocean environment on dry land. Ships excess to the needs of the Navy, and converted for research with the assistance and advice of oceanographic scientists and engineers of the Geological Survey, Coast and Geodetic Survey, and Navy, are searching for gold and other heavy metals off Alaska, Oregon, and California. Dredging operations have brought from depths as great as 12,500 feet "nodules" that analysis indicates contain manganese, and varying amounts of iron, copper, nickel, and cobalt.

Among devices being developed and tested jointly with the Atomic Energy Commission is a neutron activation device for in situ qualitative or semiquantitative analysis of sea bottom minerals.

Under the Helium Act 20 the Secretary has authority, exercised through the Bureau of Mines, for production, conservation, sale, transportation, and research of helium gas.

The Environmental Science Services Administration (a consolidation of the Coast and Geodetic Survey and the Weather Bureau) 21 also surveys and maps these marine coastal areas, and conducts investigations and research in geophysical sciences, including geodesy, oceanography, seismology, and geomagnetism.22 It cooperates with States and may contract with qualified organizations to perform its functions,23 and makes its data available to governmental and private agencies and individuals.24 One of the functions of ESSA is to describe and predict the state of the ocean for the welfare of the public and assist Federal departments in the management of natural

While the principal activity of the Office of Saline Water is discussed elsewhere, the authority for its operation includes studying methods for the recovery and marketing of byproducts of desalinization, from which magnesium, bromine, and potassium might be obtained.

26

Chemicals and pharmaceuticals

There are no statutory authorities specifically related to chemicals and pharmaceuticals of the marine environment. Under the general research authority and possibly some grant authority educational and private institutions are receiving Federal assistance to pursue programs of research connected with health and medicine.

Due to lack of knowledge few substances of marine origin are used in medicine. Many are under investigation. The Lamont group are screening about 60 pharmaceuticals from seaweeds, corals, sponges, and venomous fishes. The National Institutes of Health is perfecting an antiviral drug, one of the most sought after pharmaceutical substances today. This substance was found in the body fluids of abalones, clams, and oysters. A chemical, isolated from the poison secreted by the venomous stonefish, lowers blood pressure in animals and may prove useful in treating hypertension.

20 50 U.S.C. 167, et seq.

21 Reorganization Plan No. 2, 1965, p. 103.

22 33 U.S.C. 883d, p. 107.

23 33 U.S.C. 883e, 883f, p. 107.

24 33 U.S.C. 883c, p. 106.

25 33 U.S.C. 883a, p. 106.

28 42 U.S.C. 1952 (d), p. 97.

Incentives for private industry

Except in the case of oil, gas, sulfur, and some building materials like sand and gravel, and ceramic clays, industry has been slow to venture into marine mining in the areas of the coast of the United States. Federal agencies through the in-house research and development and grants to educational institutions are bearing the burden of establishing the economic feasibility of a private industry owned and operated marine mining industry.

Some of the incentives that will in time induce industry to take a part in marine mining development are statutory provisions not included in this appendix. One is the program for stockpiling that calls for the acquisition and retention of stockpiles of strategic and critical materials needed to supply the industrial and military needs.

In the area of taxation, it might be an inducement to private exploration of marine minerals to increase the benefits now available to lessees of mineral sites under the tax provisions for cancellation of leases. This provides that amounts received by a lessee for the cancellation of a lease shall be considered as amounts received in "exchange." This has the effect of giving such income capital gains treatment at the preferred tax rate.

And, finally, there is the system of depletion allowances.28 This allows as a deduction in computing taxable income a reasonable allowance for depletion of resources in the case of certain natural deposits. Appended is a table of allowances.29

In general

CHAPTER 3. FRESH WATER

Federal programs relating to the conversion of saline water to fresh water are to be found largely within the Department of the Interior. These include the Saline Water Act and the Water Resources Research Act. The Department of Defense and the Atomic Energy Commission participate in programs of the former; Smithsonian in the latter. Interior, Agriculture, Army, HEW, and the FPC form the Water Resources Council. The Corps of Engineers has planning and operational authority with respect to certain reservoir and purification facilities in the Northeast, under title I of Public Law 89-298, October 27, 1965, Northeastern U.S. Water Supply. Congress acknowledges that primary responsibility for developing water supplies rests with the State and local interests.2

Saline water program

In view of the increasing shortage of usable surface and ground water in many parts of the Nation and the importance of finding new sources of supply to match our present and future water needs, Congress enacted the Saline Water Act of 1952, and has repeatedly expanded the authorizations and the scope of the program.3 The term

27 26 U.S.C. 1241.

28 26 U.S.C. 611.

26 U.S.C. 613(b), see app. B, p. 139.

1 42 U.S.C. 1962d-4, p. 71.

243 U.S.C. 390b (Public Law 85-500, July 3. 1958, Water Supply Act of 1958). The legislative history of title I of Public Law 89-298, the act of Oct. 27, 1965, for Northeastern U.S. Water Supply, cited above, indicates, however, that Congress considered that act an important breakthrough toward a new policy of increasing assumption of Federal responsibility for water supply.

a 42 U.S.C. 1951-1958g, p. 97.

"saline water" was redefined to include not only sea water, but also brackish water and other mineralized or chemically charged waters.* The Secretary of the Interior is authorized to conduct and promote fundamental scientific research and basic studies to develop the economical processes and methods for converting saline water into water suitable for beneficial consumptive use; conduct engineering research and technical development work to determine by testing in the laboratory and pilot plant, the results of the basic research in order to develop processes and plant designs to a point of demonstration on a large and practical scale."

These functions may be performed by contract with scientific and engineering personnel, and with educational institutions, scientific organizations and industrial and engineering firms, by making research and training grants, using scientific laboratories of other Federal agencies, and making on-site inspections of promising projects, at home or abroad.

9

Research and development under the saline water program must be coordinated or conducted jointly with the Department of Defense so that developments of a civil nature will contribute to national defense and those primarily of a military nature will be available to the greatest extent compatible with military and security requirements. Finally, there is to be fullest cooperation by and with other Federal agencies." The Secretary's authority extends to construction and operation of five plants designed to demonstrate the reliability, engineering, operating, and economic potentials of five different processes for water conversion or desalinization determined by him to be the most promising. The U.S. Government as represented by the Atomic Energy Commission and the Department of the Interior 10 has been authorized to participate with the Metropolitan Water District of Southern California in the construction and operation of a dual-purpose nuclear power and desalting facility to be located on a man-made island off the coast of southern California. Also, participating in this project will be the city of Los Angeles Department of Water & Power, the Southern California Edison Co., and the San Diego Gas & Electric Co. These six entities have cooperatively negotiated and drafted contract documents, one between the Government and Metropolitan," and the other between Metropolitan and the utilities, which were simultaneously executed on November 20, 1967. The participation in this project by the Government is predicated on the technological and economic data and information that will be developed for use in the saline water program of the Department and the civilian nuclear power program of the Commission.

Through authorities of AEC and the Department of State, in consultation with Interior, similar projects have been sponsored or supported in foreign-countries. 12

442 U.S.C. 1951, p. 97.

42 U.S.C. 1952, p. 97. 42 U.S.C. 1953.

742 U.S.C. 1954, p. 66.

8 42 U.S.C. 1958a-e, p. 98.

Participation authorized, Public Law 89-648, 80 Stat. 895, Oct. 13, 1966.

10 Participation authorized, Public Law 90-18, 81 Stat. 16, May 19, 1967.

11 Public Law 90-18, sec. 3.

12 In 1965, the United States-Mexico and the International Atomic Energy Agency, by agreement, authorized a preliminary study of a nuclear electric power and desalting plant 16 UST 1252; TIAS 5874. See ch. 4.