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Christi because of the abundance of milo maize grown within a radius of 75 miles of Corpus Christi and the need for a plant on tidewater to make products for exporting to Europe, England in particular.
This plant ships substantial tonnages of grits, starch, and sugar; and it is estimated that annual savings in transportation costs in the amount of $50,000 will be realized if deep water is available at the plant so that the products manufactured there can move direct to shipside by conveyors after packaging instead of being stored, then loaded into boxcars, switched to the public docks and unloaded at shipside, and finally loaded aboard ship.
A recent survey by officials of the company showed that over 31,200 tons of the products manufactured locally, principally gluten, can be shipped by coast. wise vessel from Corpus Christi and distributed on the eastern seaboard in competition with other companies, provided deepwater transportation is available at the plant. Loading and shipping of 31,200 tons per year directly from the plant represents an additional annual saving in transportation costs of $88,233 ever moving the same tonnage by rail to deep water and loading it aboard vessels at the public docks.
The Corpus Christi Refining Co, plant is located on the barge channel, 2 miles west of deep water at Avery Point turning basin. This plant was purchased from Phoenix Refining Co. in October of 1952 and shortly thereafter converted to the production of jet fuel. The present plant is running 1,700 barrels of crude per day and a new crude unit is under construction which will increase the run of crude 6,000 barrels per day. The new unit, which is now being placed in operation, will increase the annual capacity of the plant to 415,000 tons. This company holds a Government contract to furnish this year approximately 200,000 tons of jet fuel to local Navy and Army airfields and arrangements have been made to move the remaining tonnage produced by the refinery by barge and tanker to other points in this country. It is estimated that 100,000 tons annually will move by barge and 115,000 tons by tanker. The saving in transportation costs to load 115,000 tons aboard tanker at a dock 800 feet from the plan as compared to piping the products 242 miles to a dock on deep water and loading tankers there is estimated at $38,330.
The armed services have requested that Corpus Christi Refining Co. construct tanks for the storage of 250,000 barrels of petroleum products at a location available to deep-sea vessels. There are no sites available on the present deepwater channel for the construction of such a tank farm; however, sites are available near the company's refinery and on the authorized project for constructing a tank farm of 250,000-barrel capacity. Based on an annual turnover of 4, the savings in transportation costs of loading or unloading tankers near the refinery, instead of 242 miles away, is estimated at $50,000 per year, which saving would accrue directly to the Government.
The American Smelting & Refining Co., which located on the proposed deepwater channel in 1942 about 242 miles west of Avery Point Basin, produces zinc by the electrolysis process with sulfuric acid as a major byproduct. The plant was originally designed to process zinc ore from Newfoundland; however, the menace of submarines in the Atlantic prevented this plan from being placed into effect. To produce the zinc vitally needed in the war effort, the company was forced to switch to the use of ores received by rail from the Republic of Mexico and the company has continued to use these ores until recently.
The present plant receives and roasts about 91,000 short tons of ore annually, producing 42,000 short tons of zinc and 67,200 tons of sulfuric acid. An expansion program was completed this year which increased the zinc production by 24,000 short tons annually, and the new plant was designed so that, within a short time if it is needed, the production of zinc can be increased by another 24,000 tons annually. Recently the local plant and the plants in El Paso and Amarillo, Tex., have begun importing ores from foreign countries through the port of Corpus Christi. It is too early to predict what will be the eventual outcome of this program, but it is reasonable to believe that with a deepwater channel alongside the plant, the company will give serious consideration to constructing its own ore unloading dock at its plant because of the substantial saving it will make in the cost of handling the ore.
The Columbia Southern Corp. owns, in addition to its property on the Avery Point Basin, a large tract of land fronting on the Tule Lake authorized deepwater project. This property was acquired for use either in future expansion of the present plant, or the construction of other plants by one of the affiliated companies. Major plant expansion on this property is being contemplated.
Heldenfels Bros., a building-materials supplier, has purchased a 275-acre site with frontage on the authorized deepwater channel for subdividing into small industrial sites. Partial development of this tract of land is now under way.
For several years the Fordyce Gravel Co. has owned a site on the authorized deepwater channel, and this company expects to develop the property after the channel has been dredged to project dimensions.
The Cargill Co. purchased a 60-acre site immediately west of Corn Products Refining Co. plant for the purpose of constructing a terminal grain elevator and grain-processing plant after the Tule Lake project has been dredged.
The navigation commission has leased to Billy Pugh a site of approximately 5 acres on the north side of the Tule Lake extension for a ship-repair yard. His company, which is constructing a modern yard for building tugs and barges and repairing similar equipment, is also inaking plans to enlarge its facilities to include ship repairing whenever deepwater is made available adjacent to the site of the present yard.
Two companies who are directly interested in the offshore oil-drilling program in the gulf are planning to make Corpus Christi the center of their offshore drilling operations for the central coast of Texas. Both companies have requested sites on the north side of the Tule Lake extension. This not only will increase the activity in the port, but will also require additional expansion of the present port facilities.
The Suntide Refining Co. has constructed the largest refinery in the Corpus Christi area under certificate of necessity TA-NC-21313. This refinery, which is located 134 miles west of the westerly end of the Tule Lake project, consists of a crude and vacuum unit, catalytic cracking unit, concentration unit, hydrofluoric acid alkalation unit, phosphoric acid polymerization unit, and complete utilities. Most units of this plant are now in operation, and when in full production the plant will run between 30,000 and 35,000 barrels of crude per day, most of which products are for the armed services.
Officials of the company have estimated that the following tonnages will move by water per year: Products
Tons per year Gasoline (regular, premium, and aviation).
660, 650 Heating oil and diesel fuel..
381, 425 Jet fuel -
250, 755 Bunker C fuel_
Total tons per year--
1, 420, 580 It is estimated that it will cost $0.30 more per ton to pump petroleum products 834 miles to deepwater and load tankers over what it would cost to load the same tankers berthed at an oil dock located approximately 134 miles from the retinery. Based on this estimate it will cost $426,000 more annually to pump the petroleum products from the refinery to tankers berthed on the present deepwater than it would to load the same vessels at Tule Lake.
The Suntide Refinery has received a second certificate of necessity to approximately double the capacity of the plant now under construction, and officials of the company have stated that construction of a second plant should begin shortly after the first unit is placed in operation, provided they receive assurance that the deepwater channel to Tule Lake will be dredged. It is estimated that an additional 1 million tons of petroleum products will move by tanker upon completion of the second unit of the refinery.
Humble Pipeline Co. has a large crude oil-tank farm located near the Suntide Refinery and not far from the authorized Tule Lake turning basin. Crude from both west and south Texas is received at this farm; however, no estimate of the tonnage that might move by water is available at this time.
The following estimated annual savings in transportation costs may be expected with a deepwater channel dredged from Avery Point to Tule Lake for the industries located along it to move their products by water transportation: Name of company
Savings Corn Products Refining Co--
$137, 070 Corpus Christi Refining Co.
33, 530 Government tank storage-
50,000 Suntide Refining Co--
Estimated total annual savings---
The estimated annual savings in transportation costs amounts to $946,600 as compared to the annual cost of $84,110 for dredging and maintaining the chan. nel. This is a ratio of 11 to 1 which amply justifies dredging and maintaining the channel by the Federal Government.
If only the tonnage immediately available is considered, the project is still economically feasible. Using the more conservative tonnages, the estimated annual savings is $508,400 which is a ratio of 6 to 1 between benefits and costs and represents ample justification for the Federal Government appropriating the funds necessary to complete the project without delay.
Based on this report, the navigation district concludes that it has fulfilled all 3 requirements of local cooperation for the Federal Government to dredge the Tule Lake channel extension by :
1. Acquiring all rights-of-way and spoil-disposal areas requested by the Corps of Engineers. This was granted the United States of America on May 25, 1948, and was recorded on July 2, 1948, in volume 400, pages 506-512 of the deed records of Nueces County.
2. Executing an agreement May 25, 1948, releasing the United States of America from all claims for damages attributable to the work of dredging and maintaining the channel. This agreement was filed for record on July 28, 1948, in volume 400, page 518 of the deed records of Nueces County.
3. Showing that the annual savings in transportation costs based on the esti. mated tonnages that will be furnished by industries located along the channel far exceeds the annual cost to the Federal Government for dredging and maintaining the authorized Tule Lake extension.
Senator DANIEL. We have Mr. Byrd Harris with us, the port director of the port of Corpus Christi.
STATEMENT OF BYRD HARRIS, PORT DIRECTOR, PORT
OF CORPUS CHRISTI
PARTICIPATION OF LOCAL INTERESTS
Mr. HARRIS. My name is Byrd Harris. I am the port director for the Neuces County Navigation District, the operating authority of the port. I have been connected with that organization for 24 years.
This project was authorized 16 years ago. The conditions of local participation which Senator Daniel has explained have been met. One condition was that local interests make arrangements with bona fide industries to locate on that proposed channel in sufficient numbers to furnish the quantity of commerce that would justify an appropriation. In trying to meet that condition, it was very difficult at the start.
At first we tried by merely showing the proposed channel on a map to locate industries. As a matter of fact, one industry did locate while it was still merely on paper. That was the American Smelting & Refining Co.'s zinc electrolytic plant. They located a very large plant up on the proposed channel. We did not have very much luck after that until the Corn Products people wanted to locate a large industry there. That is when the navigation district found it was necessary to appropriate some of its own local public funds to dredge a shallow draft channel on this federally authorized project up to a point about 3 miles where the Corn Products would locate their industries, if they had that much assurance that at least there would be barge water if not deep water to locate there. They did locate a plant of something over $20 million, a grain-processing plant which processes sorghum grain and maize.
By reason of that, the Suntide Refinery was attracted to that same area to locate a little above the head of this shallow-draft navigation and to place the largest oil refinery now located in the area, one which will process something like 35,000 barrels of oil a day, at the head of this proposed channel. So I mention that to show you what the local interests have done to meet this requirement of the Federal Government to make arrangements with industries to locate on that channel.
I would estimate that $75 million worth of industries have been brought into that area to locate in the area adjacent to this channel along with the local funds that have been expended. I certainly believe that local interests have met all of the requirements and have made these arrangements. I respectfully urge you to make this appropriation.
CORPUS CHRISTI REFINING Co.,
Corpus Christi, Tex., February 12, 1954. NUECES NAVIGATION DISTRICT,
Corpus Christi, Tex. GENTLEMEN : It is our understanding that the Bureau of the Budget is considering the allocation of funds for deepening and extending the barge channel on which our plant is located. This action would be extremely helpful to us in that it would permit us to load seagoing tankers.
We earnestly hope that this will be accomplished since it will be a big help to us and, also, it is our belief that it will greatly encourage growth and development in this area. Sincerely yours,
CORPUS CHRISTI REFINING Co.,
SUNTIDE REFINING Co.,
Corpus Christi, Tex., February 9, 1954. Mr. R. E. SALLEE, Chairman, Navigation District,
Corpus Christi, Tex. DEAR MR. SALLEE: I have been asked if Suntide Refining Co. would use the channel if it were dredged to project depth and extended as far west as Tula Lake, the present authorized terminus.
As you know, Suntide Refining Co. is completing their new plant processing 35,000 barrels of crude oil daily, and has had to make temporary arrangements to pump the finished products some 6 miles to deep water. If this channel is widened and deepened so that large tankers can reach the turning basin opposite Tula Lake, we will use this channel with a dock at the westerly end to load the company's outbound products. This, of course, would be a temporary loading dock 142 miles east of our plant. It would be much more to our advantage to extend the channel to the Suntide Refining Co.'s loading facilities.
This refinery was built in accordance with the making of aviation fuel and jet fuel to meet the demands of the Armed Forces, and is in a very important area here in orpus Christi. It is 6 miles east of the other refineries, and on one of the highest spots in Nueces County, thereby making it a strategically safer area for operations. It would be a substantial contribution to its operations if it could load the various products for the Armed Forces at the refinery site, or as above stated, 112 miles east, rather than having to pump products some 6 miles.
You may rest assured of our cooperation and assistance in any way possible in having this channel extended to Tula Lake, and preferably to our refinery site. Yours very truly,
F. L. MASTIN.
Senator DANIEL. We have also some figures from Mr. Harris which we would like to have included in the record.
Senator YOUNG. Those will be included.
(The information referred to follows:) Port of Corpus Christi, Tex., Nueces County Navigation District No. 1—Tonnage
Short tons 1947
10, 338, 176 1948.
10, 883, 083 1949.
9, 045, 630 1950.
8, 536, 815 1951
11, 459, 705 1952.
11, 531, 019 1953.
12, 135, 931 Port of Corpus Christie, Tex.—Comparative statement of cargo moving through the
port for the calendar years 1952 and 1953
[Tons of 2,000 pounds)
STATEMENT OF DALE MILLER, EXECUTIVE VICE PRESIDENT,
INTRACOASTAL CANAL ASSOCIATION OF LOUISIANA AND TEXAS
Mr. MILLER. Mr. Chairman and gentlemen of the subcommittee, my name is Dale Miller, and I am executive vice president of the Intracoastal Canal Association of Louisiana and Texas, with principal offices in Houston. I appear before you today to urge your favorable consideration of meritorious river and harbor projects which are a part of the Gulf Intracoastal Waterway.
I shall not discuss these individual projects in detail, for during the course of these hearings other witnesses are appearing before you to give you more specific information. It is my function to demonstrate to you as best I can the interrelation of these projects, many of them hundreds of miles apart, and their importance to the national economy as integral parts of an extensive inland waterway system.
As you gentlemen know, the Gulf Intracoastal Waterway has developed in recent years into a phenomenal artery of transportation. The economic benefits which have accrued from its construction and growth have far exceeded both the predictions of its sponsors and the