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Before going farther on Administration complicity in this matter, let us glance again at the oil region and see how the oil companies' support of Pelaez operates, and the situation which it tends to bring about.

As part of its program of conservation, the Mexican Government has provided that there shall be no new drillings until certain conditions have been complied with and certain payments made. The oil operators admit that they have entered into an agreement among themselves not to comply with these requirements. Under the "protection" of Pelaez, they continue drilling, without meeting any of the requirements.

In some cases the drilling of new wells has been stopped by government forces. In "Pelaez territory" it goes merrily on. But when the present Government regains control of "Pelaez territory" there will be a reckoning. The outlaw wells, under the law, are subject to confiscation to the Mexican nation. By their own action the oil operators place themselves where their interests require, not merely temporary defiance of the present Mexican Government, but its overthrow. The question as to whether or not Pelaez would destroy property if they ceased paying him becomes immaterial; they would go on paying him solely as an incident in their effort to overthrow the Mexican Government.

From the same Senate Hearing, I quote the following from the testimony of Amos L. Beaty, General Counsel and Director of the Texas Oil Company (Sept. 18):

"On three of these properties we are drilling without payment. We are doing this in the face of the warning that the Mexican Government has given our company that if a well is brought in without payment it will be taken over by the Government. We are not doing it for the purpose of creating strife. We are simply doing it in the certainty of our rights, and in the hope that we will ultimately get protection in some way."

The oil operators know very well that Pelaez cannot give them permanent protection. With all their support, Pelaez cannot alone overthrow the Mexican Government, or even capture