NEW ORLEANS, LA., January 30, 1862.

Honorable J. P. BENJAMIN:

Can the Navy Department give us any cutlasses and pistols for river flotilla; if so, how many?

M. LOVELL.

RICHMOND, VA., January 30, 1862.

General MANSFIELD LOVELL,

New Orleans, La.:

Remittance of $195,000 is now on the way to you to pay for powder. I write to-day.

J. P. BENJAMIN,

Secretary of War.

WAR DEPARTMENT,

Richmond, Va., January 30, 1862.

Major General MANSFIELD LOVELL,

New Orleans, La.:

SIR: I have your letters of the 20th and 22nd instant.* I sent you a dispatch in relation to the Tennessee, and now repeat the authority to make the best bargain you can with the owners for sharing in the adventure, so that we may have half of the return tonnage for saltpeter. Let me, however, caution you on one point. If they have all the profits of an outward cargo of cotton, we ought not to be expected to bear any of the risk of going out; if we take half of the risk, we must have half of the profits. If we are to share only in the return cargo, we must only share the return risk.

Your proposal of Cherles Koch & Co. for sureties for the contract for powder is quite satisfactory. Before getting your letter I had drawn in your favor for $195,000 to cover cost of 75 tons of powder, and the money must now be in your hands. As, however, your advance is only $125,000, you will have a surplus of $70,000, most of which you will require for settlement for powder per Vanderbilt.

I got a letter from Mr. Summer, proposing to receive in part payment of the powder per Vanderbilt $120,000 in 8 per cent. bonds. This suits us much better than issuing Treasury notes. I accordingly drew a warrant on the Treasury in your favor for $127,000, of which $120,000 in 8 per cent. bonds and $7,500 in Treasury notes. In settling with the owners of the Vanderbilt, powder, therefore, you will give them the bonds, and the balance only in Treasury notes.

Your obedient servant,

J. P. BENJAMIN,

Secretary of War.

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* That of 22nd not found.

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