We are now in the mainstream of the objectives and purpose of the Department of Transportation where major goals are transportation safety and efficiency-areas in which we have been involved in one way or another for a number of years. The development of the Department of Transportation's objectives has underscored the importance of Coast Guard missions in transportation, and has strengthened greatly our multiple-mission role. Our programs and our budget relate most meaningfully to the Department's objectives. Thus, our programs are integral parts of the total efforts and services of the Government in the broad area that is transportation. The Coast Guard performs a multiplicity of tasks. Its emphasis on providing services to transportation is amplified to deal with related areas such as fishing and oceanography.

It should be stressed that our operating programs invariably emphasize maritime safety. We set safety standards for vessels and equipment, review ship designs, carry out inspections, and conduct enforcement proceedings. Moreover, we are engaged in making the water passage, both inland and offshore, safer and more efficient by providing and maintaining a variety of navigational aids ranging from simple, nonmechanical buoys to sophisticated long-range electronic navigation systems. If a mishap does occur, it is the Coast Guard which carries out or directs the necessary search and rescue operations.

Working within the Department of Transportation the Coast Guard has demonstrated that its basic transportation support mission is fully compatible with tasks and responsibilities in the related areas. To illustrate while providing the services needed to promote waterborne transportation safety and efficiency, we effectively patrol the Nation's fishing grounds to prevent incursions from foreign vessels; our normal aerial surveillance provides immediate intelligence of potentially disastrous offshore leakages; we provide the oceangoing platforms needed by oceanographers and other scientists for dedicated programs; we provide vital weather data; and we collect and transmit the information about ocean conditions needed by the maritime transportation industry, recreational boaters, sports fishermen, the commercial fishing industry, and others.

To place the Coast Guard in perspective, our fiscal year 1969 appropriations provided for about 38,000 military and 6,250 civilian positions. We operate worldwide 173 aircraft, 347 ships and about 1,300 shore units. In addition to active duty personnel, there are about 26,500 personnel in the Ready Reserve and 4,500 in the Standby Reserve.

PROBLEM AREAS-LEGISLATION

There are some areas which I mentioned last year in which specific problems were addressed. To date general progress has been satisfactory and it would be appropriate to report at this time. Departmental legislative proposals concerning bridge-to-bridge radio requirements and unified rules of the road are pending in our legislative committee. It is my understanding that these bills, along with a proposal concerning safety regulation of diesel towing vessels, will be considered as a total marine safety package in the near future. A boating safety program as well as safety regulation of nonmilitary submersibles are presently under administration review.

Efforts are continuing to update and improve the administration of merchant vessel personnel, through such programs as streamlining the process of signing on and off merchant vessel crews, revision of license examinations to multiple-choice type, provision for incremental makeup of examination failure, and consolidation of licensing

structure.

COST INCREASES

-REPROGRAMINGS

The recent significant rises in nearly all price indices must be considered by any Government agency, corporation, or individual as among today's top problems. We have recently received permission from this committee to defer construction of our oceanographic cutter in order to offset increases experienced in our entire construction program. Under the operating expenses appropriation, we have only limited opportunity for deferral; consequently, alternate steps have been necessary to sustain operations.

LAYUP OF OVERAGE CUTTERS

During the past fiscal year we adjusted our schedule of polar operations and inactivated one icebreaker and associated helicopters. During fiscal year 1970 we are already aware of price increases and other contingencies which must be met within the requested appropriation level. I am therefore currently considering the layup of some of our older, less efficient tenders, patrol cutters, and small boats to provide resources for various cost increases. I expect that the increased capability and range of the newer cutters which have been provided us through recent appropriations will help to compensate for the resources withdrawn from operations.

OCEAN STATION PROGRAM

When I appeared before you last year, we had just participated in the Sixth International North Atlantic Ocean Station Conference, and I advised you that partially as a result of this conference we were reevaluating our total long-range requirements for high-endurance cutters.

The conference reaffirmed a near-term requirement for the present ocean station system. Another full-scale conference will be convened by the spring of 1972 to determine the program's future after July 1973.

Mr. BOLAND. What does that statement mean, the conference reaffirmed a near-term requirement?

Admiral SMITH. Five years, Mr. Chairman. The program is reconsidered at 5-year intervals, so the next time we will look at it will be 1973.

Pending this determination, as well as others such as the direction of the national effort in marine sciences, we are continuing to plan for the operation of 33 major vessels. However, since 18 have been allocated to the ocean station effort, leaving 15 for the remainder of our program requirements, our present concern is to at least finish the replacement of these 15 vessels, which comprise the basic segment of our fleet, and thereby finally permit the last of the old 311 WAVP Navy seaplane tenders to be phased out of the ocean station program.

POLAR OPERATIONS

The Coast Guard is now operating seven polar icebreakers and 14 associated helicopters, which provide icebreaking escort support to vessels engaged in logistic resupply and commercial movement in polar waters, give direct logistic support to remote polar outposts, and provide mobile surface platforms for marine sciences observations in the polar seas.

What our icebreakers will be required to do additionally in the future seems largely dependent on the development of Alaska's resources, centered upon the discovery of oil near the Arctic coast. This is certain to require sizable investments in an effective transportation system for that State. It is not yet clear what transportation system will be best for Alaskan development, but the "Manhattan project" this winter will test the feasibility of an ocean transportation route, and will have support implications.

MANHATTAN PROJECT

Mr. BOLAND. Why not explain what the Manhattan project is? Admiral SMITH. The Manhattan project is the passage of the 140,000-ton displacement tanker called the Manhattan through the Northwest Passage, from the east coast of the United States to the Arctic. She is going all the way to Point Barrow to test the feasibility of transporting oil from the Alaskan fields to the east coast via water. The Manhattan has been extensively strengthened for this ice voyage. They have had extensive testing for engineering problems and other technical problems connected with it.

The estimates were favorable enough that the Humble Oil Co. has made the investment necessary to test this particular project.

Mr. MINSHALL. When did the Manhattan project begin?

Admiral SMITH. The marine department of the Humble Oil Co., I think, first considered this possibility late last summer. A representative of the company then visited our headquarters. We discussed with them the problem and also provided them with what information we were able to furnish them as to what people they could turn to for the best information on the Arctic.

Before making the decision on chartering this tanker and going ahead with this project, they have been in touch with our U.S. Navy, with the Canadian Arctic experts, with just about everybody that they could find in the United States and in some foreign countries who have experience in this ice operation.

On the basis of this evaluation they chartered a ship, undertook the extensive modifications of that ship, and are going forward.

Mr. MINSHALL. What will be the cost to Humble?

Admiral SMITH. They have announced that the project cost is approximately $40 million at this point.

Mr. MINSHALL. The voyage itself began, did it not, about a week ago? Admiral SMITH. Yes. The ship sailed then and this morning she is up off Thule, and just entering the first ice that she has encountered. This is not solid ice, however.

Mr. MINSHALL. If everything proceeds normally, when will she complete the voyage?

Admiral SMITH. She is scheduled to reach Point Barrow on about the 20th or 21st of September and will return via the same passage, but will take quite a lot of time returning because they propose to put the ship up into the arctic pack to see if she can actually operate in this heavy ice. They will return to the east coast late this fall, I think sometime early in November.

GOVERNMENT PARTICIPATION

Mr. MINSHALL. How much of a Government effort is there backing the Humble people in this venture?

Admiral SMITH. To the best of my knowledge, there is no direct backing on the part of the Federal Government. We have observers aboard the ship, which we feel is in our interest, not in support necessarily of the Humble project. Also, the U.S. Coast Guard and the Canadians each have one icebreaker accompanying the vessel on this first voyage. This is primarily for safety purposes.

Mr. MINSHALL. The Navy is not involved in any way, is it?

Admiral SMITH. Not directly. They do have an ice observer aboard ship. One of their experts from the Naval Oceanographic Office is riding on the ship.

Mr. MINSHALL. But this is a routine safety precaution, having your icebreaker along with the vessel, is it?

Admiral SMITH. Yes. This is the way we regard it. If she cannot proceed in the ice by herself, then the project is really a failure. So the purpose of having the icebreaker with her is primarily for safety, in the remote possibility that you might have a major failure, and major casualties.

Mr. MINSHALL. Thank you, Mr. Chairman.

Mr. BAKER. I might add, just to give the committee some idea of the magnitude of the program, that, if this is totally successful-that is, that a year-round Northwest Passage proves feasible for the economical transport of oil from the north slope to the east coast, which represents, I believe, about 60 or 65 percent of the consumption, or something of that order-they are talking about as many as forty 250,000-ton tankers to be constructed for this program, among the many oil companies involved. This may be a high-side number, but it represents very close to twice or three times, as a matter of fact, the total U.S.-flag tonnage that exists now in the tanker field. So this, clearly, from a total transportation standpoint, is a project which, if successful, would have tremendous implications. As the admiral pointed out, it would have a great impact on the role and the functions of the Coast Guard with respect to the whole Alaska operation.

Mr. MINSHALL. Are you saying, then, if this operation requires icebreaker assistance, that you will plan in the future to assign other icebreakers on missions like this?

Admiral SMITH. I don't believe we are talking about icebreaker assistance as such to permit the passage of the vessel. Certainly, if there is extensive marine traffic in the Arctic, both the Canadians and the United States are going to have to think in terms of some safety measures to back this traffic up. Also, such things as aids to navigation facilities, some communications capability, the same as we do now in other areas.

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Mr. MINSHALL. This particular icebreaker that you are using on this initial venture of the Manhattan project, what station does it come from and how did you replace it?

Admiral SMITH. The icebreaker that is accompanying the ship is the Northwind, which is normally based in Seattle, Wash. She would normally be in the Arctic at this time of the year backing up the resupply operations on the Arctic coast, and also conducting oceanographic work. So that she has been sent on over to meet and to join with the Manhattan to be with her during her passage.

Mr. MINSHALL. Who is going to carry out the Northwind's assignment while she is on this mission?

Admiral SMITH. We have had to delay part of the work that she would have been doing up there, but this was not work that was of such a critical nature that it could not be delayed.

Mr. MINSHALL. What kind of work has been delayed?

Admiral SMITH. The oceanographic work. The barge traffic that goes on at the north slope each year is already in place and unloading A few of them are in some trouble near Point Barrow where the ice caught them.

ANNUAL OPERATING COST OF AN ICEBREAKER

Mr. MINSHALL. For the record, will you supply what it costs to operate an icebreaker of this type for a month's period or some appropriate time?

Admiral SMITH. Yes, sir. I can give you the information on an annual basis right now. It is about $2.3 million per year.

Mr. MINSHALL. $2.3 million per year?

Admiral SMITH. Yes.

Mr. MINSHALL. Thank you.

Mr. BOLAND. The simple fact is that if the Manhattan cannot do it on its own, then the project is not feasible and I suppose will be abandoned?

Admiral SMITH. That is the philosphoy of the company, Mr. Chairman. They do not expect to have an icebreaker break the way for them. I have discussed this with them at considerable length. Of course, if the Manhattan can't quite make it, this does not destroy the possibility that they can still go ahead because they are talking about a ship twice as big as the Manhattan with probably three times as much power, which would be the ultimate ship that they will be using.

Mr. MINSHALL. It would be an icebreaker in itself.

Admiral SMITH. A very large reinforced tanker with excellent icebreaking characteristics, yes.

Mr. CONTE. Would you yield, Mr. Chairman?

Mr. BOLAND. Yes.

Mr. CONTE. Once you got through there, then it would be very easy for other ships to follow?

Admiral SMITH. If you could follow, it would be very easy to follow one of these directly. It is my understanding, however, from discussions with our icebreaker people that in going through the ice in the Arctic that your track would not remain there very long. There is constant movement of the arctic ice, so that this track would close and