 The atoll was the first Pacific island annexed by the United States, as the Unincorporated Territory of Midway Island, and was administered by the United States Navy.The first attempt at settlement was in 1871, when the Pacific Mail Steamship Company started a project of blasting and dredging a ship channel through the reef to the lagoon using money put up by the United States Congress.The purpose was to establish a mid-ocean coaling station to avoid the high taxes imposed at ports controlled by the Kingdom of Hawaii.