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Section II

SUMMARY AND CONCLUSIONS

1. Maintaining income from oil exploration and development is a para-
mount consideration. Good oil fields surround the Newhall Land
and Farming Company property proposed for use as a planned com-
munity. Oil exploration rents on those segments of the property
under lease to oil companies are currently yielding about $60 per
acre annually. Potential oil royalties could, of course, far exceed
this income. Therefore, the Company must be sure that _oil explo-
ration will not be inhibited. In the proposed industrial areas, no
particular difficulties should be encountered by the Company in
maintaining 100 percent of the mineral rights and drilling islands
from which to drill both exploratory and possibly development wells.
In the proposed residential areas, skillful planning and adequate
zoning should protect both the Company's interest in oil exploration
and future landowners' property v.alues. In order to gain the co-
operation of future landowners, it may be necessary for the Com-
pany to allow the landowners to participate, even though on a small
scale, in possible future income from oil production.

2. Oil companies would, of course, prefer to explore for oil in open
country. However, oil exploration and development using modern
drilling techniques is currently being carried on in both residential
and industrial areas. There seems to be a feeling among oil com-
pany people and realtors that more of these oil operations in built-
up areas can be expected. The possibility of oil exploration and de -
velopment does not seem to pose a problem to the subdivision that
cannot be solved by foresighted planning, adequate zoning, and care-
ful management of the over -all sub di vision.

3. Current earnings from the property under consideration for sub-
division are derived from agricultural leases , oil exploration rents
and bonuses , and commercial leases. The gross income from the
property has increased regularly over the past six years. Oil ex-
ploration rents on the property are currently yielding a gross in-
come of $60 per acre annually. Gross income from irrigated agri-
cultural land including the acreage along the Saugus-U. S. Highway 99
road, averaged $53 per acre in 1952.

4. The agricultural land along the Saugus-U. S. Highway 99 road seems
well suited for development as a light industrial area at the present
time .

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