War of the Rebellion: Serial 127 Page 0293 CONFEDERATE AUTHORITIES.

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certain localities in North Alabama, an agent, Mr. Riddle, has been dispatched to examine several caves on Little Bear Creek, in Franklin County, and another in Blount Country. There is good reason to believe that his researches will be successful. Ample inducements have been offered to Mr. Riddle, and will be held out to others, to engage in the production of niter in these localities should the deposits warrant it.

It was not known to the Department that power-works existed anywhere within the limits of the Confederate States until recently. A firm of power manufacturers, whose mill is situated twenty-three miles from Nashville, on the south bank of the Chamberland River, have within a few days past offered their services. They state that their mill can, in thirty or forty days, be arranged so as to enable them to produce 1,000 pounds of power per day. They have a small stock of brimstone on hand, but no saltpeter. As soon as the saltpeter and sulphur now understood to be I possession of the State of Georgia shall be turned over to the Confederate States, it is proposed to employ this mill at once. The proprietors of these mills, Messrs. Cheatham, Watson & Co., state that, from examinations made by themselves during the Crimean war, they are satisfied that an abundant supply of saltpeter can be obtained from the caves of Middle Tennessee bordering on the Chamberland Mountains. I h ave requested them to sent an agent at once to examine these localities at the expense, if need of, of this Government.

Other mills are said to exist in Tennessee and also in South Carolina. The Department will endeavor to communicate with the as soon as it can ascertain their localities. In reference to the manufacture of small-arms the prospect is not so satisfactory, and it is probable that the Government will be obliged to initiate steps toward the immediate establishment of manufactory of this kind of arms, In a matter of this sport, in which prompt action is vital, I recommend, in answer to the latter part of the resolution of Congress asking my opinion as to the action deemed necessary to promote the manufacture of arms and power, that a competent agent be selected and sent without delay to England. At London a complete set of machinery exists, which was made in this country, fatter the pattern of the machines at Springfield, in the United States. It would, I think, be no difficult matter to get these machines copied and executed on the spot with rapidity. Triplicate machines should be ordered to insure the changes of delivery of at least me set. For this purpose an additional appropriation of $300,000 may be needed, under the appropriation of ordnance and ordnance stores and supplies, for the three sets of machinery. Should they all arrive they will, even if not required by the Government, be easily disposed of. The amount already asked for under the head of armories and arsenals would also require to be increased by an item of $75,000 for a suitable building in which to place this machinery at one of our arsenals, or the machinery, when so procured, might be placed, if through desirable, in the hands of parties having manufacturing facilities, who could give ample security for its application to the sole uses of this Government. No further action is deemed necessary to stimulate the production of power than, perhaps, to make advances to parties who officer to engage in its production, to enable them to prosecute researches after saltpeter in remote districts difficult of access. It might be advisable to offer a bonus of, say, $5