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000701\ . . Fruitland Mesa Project.--The Fruitland Mesa Water Conservancy District will be the contracting entity. We are now engaged in developing an appro- priate contract to be negotiated with the District and it is anticipated that the contract will be executed in 1968 as project construction is scheduled to start in January 1970. No contracts for M&I water use in Colorado are under consideration. Five contracts for water service from Navajo 'Reservoir have been negotiated and submitted to the Department for approval. :Each of these contracts requires Congressional approval pursuant to P.L. 87-483, the act authoriz- ing the San Juan-Chams and Navajo Indian Irrigation Projects. Three of the contracts have been approved recently by the Congress pursuant to S.J. Res. 123. Water diversion by the three contractors will amount to 64,250 acre- feet. These contracts have a termination date of 2005. We have had discussions with prospective users for water allotted to Arizona and utah. For these users the water would be taken from Lake Powell and used for thermal-electric generation in the respective States. Power Marketing The marketing of storage project power is proceeding on schedule as increased amounts are placed under contract. During 1967 four new whole- sale customers were added, bringing to 81 the number of firm power contracts now in force. Two of these new contracts are with the cities of Oak Creek and Delta in Colorado. Since the cities are located remotely from the project trans- mission lines, the transmission lines of Colorado-ute Electric Association and its member cooperatives must be utilized in! supplying Bureau power to these cities. Oak Creek has been taking power for some time now while Delta, who has yet to complete its interconnection with Delta-Montrose Electric Cooperative, is not expected to receive power until next fall. CRSP contracts call for a total delivery of better than 700,000 kilo- watts this coming sunnner and about 450,000 kilowatts next winter. By 1971 nearly one million kilowatts of firm power will be delivered to customers throughout the 7-state marketing area of the storage project. We have just recently started negotiating contracts with the preference customers to supply their estimated 1975 power needs. As of now three such contracts are completed and many more are in the final stages of negotiation. Revenues from the sale of project power during calendar year 1967 exceeded $16 million, a new high for a 12-month period. Total power reve- nues for just over four years of operation has now reached $40 million. This program on CRSP power marketing and revenue buildup is satisfactory for the relatively short period of project operation and well within the project repayment schedule for this buildup phase. With normal water 4