In 1884 President Gonzalez inaugurated the policy of granting exclusive concessions to the pearl reefs. On February 28 of that year, five concessions were granted to as many persons, giving them and their associates and assigns the exclusive right to all shell fisheries in their respective zones of large area, for a period of sixteen years, in consideration of a royalty and export duty, amounting altogether to about $10 per ton of shells exported in the first three years, and $15 per ton for the remaining thirteen years of the term. Immediately these five grants were consolidated, forming the Lower California Pearl Fishing Company (“Compañia Perlífera de la Baja California”), incorporated under the laws of California with an invested capital of $100,000. Other concessions were given covering the ocean shore of Lower California, the eastern side of the gulf within the States of Sonora and Sinaloa, and the ocean shore of Mexico southward from Sinaloa. In addition to these, certain territorial rights of fishing are claimed through grants dating back very early in the history of the country. So eagerly have these concessions been sought in recent years, that there is now little pearling ground on the coast which is not under corporate or private claim. And, owing to speculation in these concessions and in the formation of companies to develop them, it is somewhat difficult to obtain wholly reliable data relative to the condition and extent of the industry. Two species of pearl-bearing mollusks occur on the Mexican coast. The principal one is the _M. margaritifera mazatlanica_, known locally as the _concha de perla fina_. This species is closely related to the “black lip shell” of the Australian coast. It is considerably larger than the Venezuelan oyster, averaging four or five inches in diameter and attaining an extreme diameter of seven or possibly eight inches. It occurs to some extent all along the Pacific coast of Mexico, in detached beds intercalated in places. The principal reefs, which have been exploited for nearly four centuries, are in the shallow waters of the Gulf of California and especially within the 300 miles between Cape San Lucas and Mulege Bay. The fisheries have centered about the islands of Cerralvo, Espiritu Santo, Carmen, and San José, and in the bays of Mulege, Ventana, and San Lorenzo. The depth of water on the reefs ranges from two to twenty-five fathoms, with an average of probably six or eight fathoms. The species is generally isolated, and firmly attached by the byssus to the bottom rocks or the stone corals, from which it may remove in case of necessity, though it probably does not do so frequently.