in regard to rumors that some scouts or spies of the enemy had probably been on the island. It is difficult, if not impossible, to say from the report whether there is any foundation for the rumors or not. Owing, however, to the low and marshy character of the island on the bay side, and the impossibility of reaching it at all points by mounted scouts, there is plenty of opportunity for spies of the enemy to reach the island in our rear and confer with citizens in regard to our forces.

For the further information of the brigadier-general commanding, I beg respectfully to state that there are living on Saint Joseph's Island, near Cedar Bayor, two men who have no visible means of support, unless they get it from the enemy, and that on this island there are two families, those of Thomas Collins and Bloodworth. There is also an Englishman, claiming still to be a British subject, who pretends, to be the owner of all the sheep on the island, by the name of Little, whom I suspect from his dictatorial manner and haughty bearing to be an arrant rebel, and, in my opinion, would, if possible, give the enemy any information in his power. if it is not assuming too much on my part, I respectfully recommend that all the citizens above referred to, unless it be Thomas Collins and family and Bloodworth and family, be ordered into the lines at Pass Cavallo.

If this, however, should not meet the approbation of the general commanding. I respectfully suggest that Mr. Little be ordered inside the lines of the defenses. At this time he is herding his sheep in the vicinity of residence of Bloodworth, 6 miles from my headquarters; but i am sure it was the intention of the major-general commanding the corps to have him moved to some point between Camp Herron and Fort Esperanza as soon as practicable. From the report I got, I think no considerable quantity of fuel could be had at Panther Point. There probably might be several loads of driftwood collected on the bay side of the island. I respectfully suggest, if we had a good ferry across Cedar Bayou it would answer the double purpose of getting the wood off Saint Joseph's Island and keeping a communication open with Major Thompson, at Arkansas Pass.

I have the honor to be, lieutenant, respectfully, your obedient servant,

A. C. MATTHEWS,

Major, Commanding.

[Inclosure.]

IN CAMP NEAR CEDAR BAYOU,

Matagorda Island, Tex., May 14, 1864.

Major A. C. MATTHEWS, Commanding Outpost:

MAJOR: I obedient to instructions received from you, we proceeded yesterday morning to explore the wee satchel and chaparral thickets upon the point in the rear of Mr. Bloodworth's house, known as Panther Point, and thence as far as practicable to penetrate the extensive salt marsh, which extends in a northeasterly direction from the former place into Espiritu Santo Bay, and beg leave to submit the following report: Panther Point is a narrow neck of land formed into a peninsula by a small cove or arm of the bay making into the main island, and points in a westerly direction, the outer or bay margin of which varies little, if any, from the general line of the island coast. A salt interviews between the point proper and