Residence of 14 months at Shiprock in 1923 and 1924, while representing the US Bureau of Mines, and subsequent trips have afforded the writer opportunities to observe the results of development of the Navajo Reservation. The structures which were considered most favorable for oil accumulation yielded negative results, and the less favorable one was developed into a producing field. The writer points out the possibility that circulating underground waters, in accordance with the hydraulic theory, have been responsible for the vagaries of accumulation, and some proof is offered. The suggestion is made that an intensive study of the Shiprock region would furnish additional evidence related to oil accumulation in that area.