In 1922, President Warren Harding’s Interior Secretary Albert Fall found himself in hot water after taking bribes to sell a small oil field in Wyoming, as well as one in California.
Now -- 93 years later -- the Department of Energy is signing papers to take the Teapot Dome field out of federal hands for the second and final time.
Fall was caught taking bribes from executives of both Mammoth Oil Company and Pan American Petroleum and Transport Company -- to which he’d just leased the oil production rights of the Teapot Dome field in Wyoming and the Elk Hills field in California, respectively.
The Senate investigation led to court cases, and in 1927 a Supreme Court ruling said the leases were invalid and returned the oil fields to the Navy.
Fall fell fast, and in 1929 became the first former U.S. cabinet official sentenced to prison when he was found guilty of accepting bribes. (An interesting side note: Edward L. Doheny of Pan American Petroleum was not only acquitted of bribery, but his company foreclosed on Fall’s home because of “unpaid loans,” referring to the bribery money.)
The oilfield lay dormant until 1977 when the land -- now called Naval Petroleum Reserve #3, or NPR-3 -- was transferred to the Energy Department along with the Elk Hills field. The crude oil, natural gas and liquid products produced from the reserves were sold at market rates and revenues were deposited to the U.S. Treasury.
In nearly 40 years of operation under the Department of Energy, the NPR-3 oilfield produced over 22 million barrels of oil, resulting in over $569 million deposited in the U.S. Treasury. NPR-3 also became the home of the Department’s Rocky Mountain Oilfield Testing Center, which used the reserve as a commercial testing ground for new technologies and processes.
After a competitive bidding process -- something not required in 1922 -- the papers were signed today to sell the historic oilfield to Stranded Oil Resources Corporation for $45.2 million, closing the federal chapter of Teapot Dome ownership.