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By H. Lyn Bourne

This is the fifth annual tabulation of mineral royalty information. This tabulation, like the previous editions, includes all of the earlier data. There are also 60 new entries. In addition to royalty information, some entries show the cost of purchased reserves. Two articles relative to the evaluation of minerals reserves appeared in December, 1986. R.H. Paschall (In the Aggregate, ME, p 1139) wrote a good article, although it lacked specific royalty data. However, this author takes exception to two ideas in Paschall's column. Paschall contends that the royalty rate does not affect the mineral appraisal. This present author could not disagree more. Paschall also claims the location of an industrial mineral deposit is the only serious or practical caveat in comparing royalties. Comments received here from readers helped make the list of caveats that are cited each year. The readers will decide which factors influence the mineral value for their commodities of interest. Paschall's point about the relationship of the parties who are negotiating a royalty agreement is important and very well taken. The other article, written by William Vernon (Pit and Quarry, December 1986), gives a step-by-step process on how to conduct a mineral appraisal. The article cites three reasons for an appraisal: transfer rights; collateral for a loan; and taxation. A fourth reason is to establish adequate compensation for reserves lost through condemnation. This author has appeared in several court cases where compensation for loss of mineral reserves through condemnation required a mineral appraisal. Royalty rate becomes an important factor in the appraisal process, although the Pit and Quarry article refers to that part of the valuation equation as "profitability." Both articles were well written and are recommended reading for those interested in mineral valuations. The same caveats that have appeared in previous columns relative to factors that influence the value of reserves are restated. The data in the table serve as a general reference and are not intended to present an absolute scale of reserves costs. Several factors influence the value of any mineral commodity. The factors include: • location/transportation - especially significant for most industrial minerals; • market conditions both for the commodity and the company acquiring the right to mine; • quality or grade of the deposit as it reflects the amount of processing/beneficiation necessary to produce the finished product; and • legislative restrictions and conditions for mining a given material at a given site. These and other factors will significantly influence the cost of reserves. The table shows the range of royalties and the variations in the basis of computing the fees. In a few instances, it gives the cost of acquired reserves based on purchase price and quantitative estimates of the material in place. The table lists the commodity in column 1, and the subsequent columns give: • the location by state, US geographic area, or Canadian province ; • the cost - R for royalty and P for purchased cost; • the year in which the lease or purchase agreement occurred; and • comments or footnotes for more information. The cost column requires more explanation. The units may refer to cubic yards (/cu yd), cubic feet (/cu ft), short tons (/T), or acres (/A). 1 cu yd = 0.76 M2 1cuft = 0.28m3 1 st = 0.9072 t 1 acre - 0.4047 ha or m2

Jan 7, 1987

By H. Lyn Bourne

This is the seventh annual tabulation of royalty information. It is also the first year in which some data have been deleted to make room for new data. The concept of royalties evolved from a time when the government owned all of the land, including mines, to the situation where free miners won the right to claim minerals but paid a portion of their production to the royal treasury. Today, a mineral royalty is a payment to the owner of the mineral rights for the privilege of producing the mineral commodity. However, some people incorrectly believe that the selling price and the royalty are the same thing. The contract between the owner (lessor) and the mining company (lessee) is the mineral lease. Some clauses that are common to mineral leases include: identification of property, granting clause, reservations, definitions, royalty rate, taxes and title, indemnity, termination, inspection, assignability, successors, and reclamation. There often are variations in royalty rates for a given commodity that reflect differences in location, quality, market conditions or public versus private ownership. History In the time of ancient Rome, the government owned the mining properties by virtue of conquest. It would lease the mines to favored citizens who would pay rent to the State. Various conditions of sovereign ownership of both land and mineral rights continued in Europe until the Renaissance. As the laws evolved for land ownership by private citizens, the concept that minerals belonged to the State (King, Crown, sovereign) continued until about the 15th century. Free miners challenged the notion of sovereign ownership and won the right to discover and claim minerals. But a portion of their production had to be paid to the sovereign - a royalty. So, the original concept of a mineral royalty was a tax on production that was due to the Crown or Church. The term mineral royalty, as it is known today, is a payment to the owner of the mineral rights (formerly the royal owner) for the privilege of mining and producing the mineral commodity. The owner of the mineral rights, the lessor, and the mine operator, the lessee, enter into an agreement to mine the property. The agreement is the lease. While this concept is common, there are some who do not understand that the royalty is a portion of production paid to the owner as agreed on in the lease document. This author has seen reports where the selling price of a commodity has been quoted as the royalty. ("They get 70 cents a ton royalty at their pit and the guy down the road only has a 65 cent royalty.") These reports have been authored by people not familiar with the mining industry. Lease clauses In addition to the amount to be paid the lessor, there are several other items to be addressed in the lease agreement. The following list may not be all inclusive, but briefly describes most of the common clauses any good mining lease should contain. Identification: This opening clause names the owner (lessor) and the operator (lessee), the address of each, and gives the legal description of the property. Granting clause: This part of the lease gives the time period or duration of the agreement and information about renewal periods. It also has language about the exclusive right of the lessee to mine the property. Reservations: If the owner wants to exclude any portion of the property or set some specific conditions about the operation, there needs to be a clause that describes these reservations. Definitions: This section should address some of the technical terms that the lessor may find confusing - short tons versus cubic yards, dollars versus percentage of average selling price, any escalator indices such as consumer price index or producer price index, and material mined versus material sold. Royalty: This section spells out what the royalty rate will be, how often it will be paid, if there is an annual minimum, the pay dates, and how the records will be kept. This section also describes the conditions under which the lessee is exempt from the annual minimum - natural disasters, strikes, governmental actions, or other causes referred to as force majeure. Taxes and title: The lease needs to identify who is responsible for the property taxes, severance taxes (if applicable), and other taxes that relate to the mining activity - taxes on equipment, improvements, or stockpiles. This is a good place in the lease for the owner to certify his ownership of the property and its mineral rights and also certify that no other leases are in effect. The lessees may want language that allows them to pay mortgages or other debts on the property to keep their lease in effect. Indemnity: This portion of the lease identifies that the lessee assumes the risks for lessee's mining operation. Lessor should expect indemnification by the lessee through standard insur¬ance policies - workers compensation, liability and property damage. Termination: Both the lessor and lessee want language that will allow them to terminate the lease. This section of the lease describes the conditions under which one of the parties may terminate the lease (failure of the

Jan 1, 1989

By H. Lyn Bourne

This is the ninth annual tabulation of royalty information. Again this year, some of the older information has been deleted to make room for more than 30 new entries. Several articles and publications crossed the author's desk this past year that relate to mineral valuation and mineral royalty. Tom Loucks presented a paper, "The Valuation of Hard Rock Mineral Property," at the Rocky Mountain Mineral Law Foundation in Santa Fe, NM in July, 1990. His paper gives an indepth explanation of the definitions and concepts related to mineral valuation. It includes descriptions of numerous legal cases that have dealt with mineral valuation and proper reference is given for each case. Loucks works for the Denver Mining Finance Co. Gold royalties generally range from 5% to 7%, net smelter return. However, Severn Brown sent information that shows a much wider variation. Echo Bay Mines reported in its 1989 annual report royalties that range from 1.5 % to 30% for gold from various gold properties. Brown also sent a copy of an article that appeared in the Dec. 27, 1982, issue of Fortune magazine. This issue carried an article by Walter Guzzardi, Jr. "The Huge Find in Roy Ash's Backyard." The article gives the history of Newmont's leasing in Nevada on property that became the Carlin, Bootstrap and Blue Star Mines. The article states that the initial royalty was 10% that escalated to more than 16%. Another property, the site of Gold Quarry, provides an 18% royalty to the same own¬ers. The article makes interesting reading for those interested in mining history.

Jan 1, 1991

By H. Lyn Bourne

This marks the 15th consecutive year for this column. During 1995, readers were asked to supply royalty data for construction raw materials especially for states where none is available. The response was discouraging and royalty data are still missing for several states for either sand and gravel or crushed stone. Several readers have said that this article has merit but more new information is needed to justify its continuation. Several articles and pieces of news relative to mineral royalties appeared in the trade journals. R. Lee Aston (E&MJ, November, 1995, p. 16N) described South Australian royalties as amended by the government in1994. The royalty rate (a percentage) was lowered but the assessed value for minerals was raised and the current rate amounts to 20 cents//t (18 cents/st).

Jan 1, 1996

I want to explore whether it is valid or even useful to talk about sustainable corporations. After 20 years of focus on sustainable development, the concept of a sustainable corporation is not particularly helpful and it may in fact be profoundly misleading. Why? û because it obscures the need for corporations to be recognised as part of a sustainable society, rather than achieving some kind of corporate nirvana divorced from the social, political and environmental reality. It is more helpful to ask whether corporations are ready to recognise that they are one player among many within society û with the demands this would place on them in terms of transparency, accountability and social responsibility. The achievement of sustainable development has become the new corporate orthodoxy of many large corporations. It has become a clichT to argue that corporations must become æsustainableÆ. The achievement of æsustainabilityÆ is encouraged, as the ultimate step in some form of corporate evolution. We are failing to recognise that sustainability a process û not an end in itself. An enormous array of instruments is being developed to measure when sustainability is or is not being achieved. For example, corporate reporting has burgeoned into an art form, which describes æsustainabilityÆ in a variety of ways. There is no external standard applied to such reporting. These descriptions are quite partial and often place the best possible gloss on the companyÆs activities. I have become increasingly uneasy about this rhetoric and this paper has allowed me the luxury of sorting out my unease. I will discuss, largely in the Australian context, the current debate and literature and describe the way some global mining corporations are dealing with these questions, and finally, offer some suggestions which might be helpful at the operational level.

Jan 1, 2002

By R. R. Stone

"This paper will examine the role of debt and equity in project financing and will illustrate the impact on the return to the project sponsor of each type. Conventional debt sources will be examined, as will product purchaser advances, foreign export-import bank loans and lease financing. The paper will review guarantees, charges against the project, dividend restrictions and other commitments. It will also discuss various features of sales contracts and the degree to which they can assist in securing financing. IntroductionThe cost of bringing new mining projects on stream is escalating significantly more rapidly than general rates of inflation. Reasons for this include the higher costs of safeguarding the environment and ensuring the health and safety of workers. The need to develop properties in more remote areas is also a significant factor. These higher costs have not been matched by increases in metal prices, making the task of financing these projects ever more difficult. At the same time, the imagination of borrowers and lenders seems boundless, and innovative schemes for financing projects are constantly being unveiled.It is probably safe to say that no two projects have ever been financed in precisely the same way and the number of financing options for any project is limited only by the imagination of the sponsors themselves. The objectives of the project sponsor represent the most important factor in determining the scope of possible financial arrangements. For example, the sponsor may wish to maximize over-all company leverage by isolating each of its projects in separate companies. In so doing, it hopes to facilitate more ventures than would otherwise be the case. These objectives point toward true project financing. Additional objectives may be to develop a number of its properties by joint venture and to reduce the amount of debt on the sponsor's balance sheet. Those sponsors whose objectives include minimizing over-all financing costs will wish to increase the number of financial options and, as a result, will not be so concerned with effecting true project financing. This approach may also provide ""greater certainty that tax benefits are utilized quickly."

Jan 1, 1980

By A. C. Rubel

WHAT does management expect of W and from an engineer? First and foremost, it expects that he should become, and therefore should fit himself in every way to be, a part of management so that he may assume as much and as many of the responsibilities of management as his ability and the opportunities of the job permit. Let me make clear at the start that the profession of pure, technical engineering offers but limited opportunities at the top levels because of the inherent organization of engineering work. The line of succession to top jobs may be likened to a cone with a broad base and an extremely sharp point. Consider any oil company, large or small, or any operating function of that company, and you will find few top engineering jobs in the organization. This is true by the nature of the work handled. There will be a few district engineers depending on the spread of operations, a chief petroleum and production engineer, perhaps a few research engineers, possibly some technical executive assistants, and that is usually all. The road to these jobs is a long one and the competition is tough. The larger the organization the greater the opportunity, but always the ratio of engineers to top engineering jobs is only a small one.

Jan 1, 1947

By Edmund J. Pryor

DURING the war years restrictions on travel, pressure of work, and the irregular arrival of technical literature from abroad combined to severely isolate Great Britain in a period of intense war expansion of the art and practice of mineral dressing. Many British technicians were fully occupied with the day-to-day problems of improvising substitutes as regular sources of supply failed. and with mastering the strange demands and working conditions of wartime. After a long day spent between ones laboratory and production work, the rest of the waking hours were often filled with fire watching or home guard patrol activities, substituting for a night-shift manager, or "resting" in a dugout while the bombs came down. There was no time for serious study of such technical literature as survived the Atlantic crossing.

Jan 1, 1947

By Hal M. Lewers

IN the past few years and especially since the beginning of World War No. 2, gold has attained a new, important. and critical place in the international scene, and in world affairs. In the past, as far back as history records, most wars have been waged for the purpose of acquiring it from someone else by conquest. But now, the most titanic struggle of all time is being waged with the avowed purpose of not only destroying it, but of destroying all that it stands for and represents. A tradition dating back to ancient Rome, affirms that battles are fought by men with weapons, but wars arc eventually won by gold. The validity of that tradition is now being subjected to its major test. Hitler has proclaimed that in his new world order, the work dollar or reichsmark, a beautifully engraved paper currency representing only a theory of value, based on unit of work and production, will become the supreme medium of world exchange, and that gold eventually will he valueless and obsolete.

Jan 1, 1942

By P Card

Some project managers accept unsatisfactory economic evaluation modelling because they are unaware of what constitutes good practice. They tend to leave it to the evaluation specialist or others to decide. The AusIMM has published on its website a draft set of guidelines for technical economic evaluation which will allow these project managers to take control and demand worldÆs best practices.The style of the guidelines is described and the source of a worked spreadsheet example in Excel is given.Economic evaluation in project management is described. A simple test for the acceptance or rejection of evaluation work is offered. The nature of modelling and evaluation in each of the three study phases of concept, prefeasibility and final feasibility are described. Suggestions on the selection of specialists for each phase are given. The three levels of evaluation thinking are described, namely, modelling, valuation and evaluation. Finally the meaning of æfinancial analysisÆ is explained.The conclusion is that æthe role of an economic evaluation specialist is to create models and evaluations for the whole project team to readily understand and use: it is not to create models for his/her own useÆ.CITATION:Card, P, 2012. What project managers must demand from an economic evaluation!, in Proceedings Project Evaluation 2012 , pp 173-176 (The Australasian Institute of Mining and Metallurgy: Melbourne).

May 24, 2012

By M. T. Ityokumbul

Flotation columns and their variations are increasingly replacing conventional cells in mineral processing circuitry. While the operational characteristics of columns differ from those of conventional cells, the same scale-up methodologies are being employed in design. This practice may be attributed to poor understanding of the factors controlling throughput. The use of tall flotation columns is frequently justified on the requirement for increased particle residence time. It is shown that longer particle residence times in the column cell alone do not translate into increased recoveries. Throughput data from several industrial flotation column installations is presented. An attempt at using dimensional analysis to provide scale-up methodology for the factors controlling column throughput is made.

Jan 1, 1995

By A. C. Fieldner

THE total annual energy production from coal, petroleum, natural gas and water power has been increasing at a fairly constant rate during the thirty years ending in 1930. But since 1913 the demand for the competitors of coal has increased at a rate faster than that for coal. During the last twenty years, the curve of coal production has had a generally horizontal trend; in fact, the 1930 production of coal was six per cent less than that of 1913. Economists attribute this loss of demand to greater efficiency in coal utilization and to displacement of coal by oil and natural gas. These two factors are about equally responsible, and it is evident that research has been intimately concerned with both. About sixty per cent of the bituminous coal mined in the United States in 1929 was used for generating steam, either in stationary or locomotive boilers. A decade ago seventy per cent or more was used for this purpose. This change is due largely to tremendous advances in fuel economy.

Jan 1, 1933

By Charles H. Fulton

IT is assumed that the word "college" for the present purpose signifies technical school or technical department of a college or university. About ten or fifteen years ago, and more recently in some instances the contact between the technical school and the industry, as represented by the operating companies, was very limited. The school made no effort to place its graduates in the industry and the graduate's first position was obtained by his own or his friends' efforts; the friend often was a professor. The industries, or the operating companies, seemingly had little interest in the training of the technical graduates they employed or in seeking to discover their personal characteristics and fitness for the work. In the public mind there was little relation between technical training and industry. Such training was in the field of education; industry was in the field of business; and the interrelationship was not a matter of common knowledge or concern.

Jan 1, 1929

At first glance the staid Joralemon background does not seem to equate with the life of adventure that irresistibly called me for over 70 years. But my ancestors had their adventures too. My father's family were Dutch Reformed Protestants who had energy or daring enough to come to America to escape the Catholic persecution that followed the Massacre of St. Bartholemew. The first Joralemon came from Friesland to New Amsterdam m 1636, just after Peter Stuyvesant. My father's mother's family, the Berdans, were French Huguenots who came to northern New Jersey only a little later to escape the Catholic domination in France. Some say that the first Berdan to come to America was given all the land between the Passaic and the Hacken-sack Rivers by King James. Whatever, the Berdan family settled there and was able to make a scanty living by farming and selling their produce in Manhattan. The spirit of adventure in my mother's family was just as tenuous. Gamaliel Beaman was pastor of a shipload of Puritans who came to Massachusetts in 1636. Gamaliel's descendents were peaceful farmers and some ministers in New England and later New York State. They had got all of the adventure out of their systems in the long and dangerous voyage across the Atlantic to escape religious persecution. The Joralemons and the Berdans married into families that had been in America almost as long as they had. On my father's side the Berdans, Doremus, DeGreys, Vanderbeeks, and Varicks showed by their names their Dutch or French Huguenot stock. The only one who achieved any fame was Peter Varick, who was George Washington's military secretary during the American Revolution. After this he was nine times mayor of New York and was one of the founders of Kings College, later Columbia University. He was responsible for one of my few ancestral claims to distinction. When the Marquis de Lafayette made a fare-

Jan 1, 1976

By Frederick Prime

AT the last meeting of the Institute, Mr. A. L. Holley read a paper on "Steel," in which he proposes for it a definition so opposed to the one generally received, as to call for some remarks. Until within the last five or six years there has been no dispute on the subject, and it seems worth while to investigate the matter. For not only does a proper tax on all importations depend on a proper appreciation of the term steel, but it is necessary to know whether steel, or wrought-iron, or homogeneous iron are requisite in all processes of manufacture in which malleable iron is employed, on account of cost, strength, etc. Karsteu* says : " Iron may be obtained, either as an unforgeable, unweldable metal, which melts at a high heat, termed cast-iron; or as a ductile, weldable, soft metal, which can only be melted at the * Karsten, Handbuch der Eisenhüttenkunde, 3d ed., vol. i, p. 6. Berlin, 1841.

Jan 1, 1876

By Jodi Banta

Thanks to strong industry support and longstanding partnerships, the University of Arizona has provided extensive pre-college mining education and outreach for more than a decade. These efforts to promote mining-related degree programs and the wide variety of indemand career opportunities reach thousands of middle and high school students and hundreds of teachers every year. The School of Mining Engineering & Mineral Resources is constantly looking at ways to help students overcome barriers into degree programs. But competition among degree programs for talent is fierce, and outreach has not made a big enough difference in the number of students pursuing mining engineering degrees. With workforce shortages threatening to undermine the industry, more is needed. The Bureau of Labor Statistics estimates 500 new mining engineering jobs each year, and according to a study by Deloitte (2023) nearly 50 percent of skilled engineers will reach retirement age in the next decade. At the same time, the 14 accredited mining or mineral engineering degree programs in the United States are producing fewer than 200 graduates annually (Society of Mining Professors and Society for Mining, Metallurgy & Exploration, 2021). To better understand mining’s competitive position, the School of Mining Engineering & Mineral Resources conducted a comprehensive study to determine (1) how prospective college students, parents and educators perceive the industry, related careers and the mining engineering degree, (2) factors affecting students’ choices of degrees and career plans and (3) the roles parents and educators play and how they influence students. This article is the first of two installments to discuss the results. This installment focuses on what students, parents and educators think about mining and where they get those impressions, as well as the role parents and educators play in influencing students’ choices of careers and degrees. The second installment, scheduled for publication in a later issue of Mining Engineering, looks at what students are seeking in their degrees and careers, and how mining compares with other degrees and industries.

Sep 1, 2025

By Doris Hiam-Galvez

The latest technologies that improve mining and mineral processing efficiency and significantly reduce the emissions and effluents will be briefly reviewed. In this sense, the paper point out that the water treatment using techniques such as nanofiltration through membranes to achieve purity levels equal to the incoming water supply is now possible and examples of how this is done will be presented. Membrane technology using nanofiltration can be effectively used for recovering valuable products in water from mining operations and also to remove contaminants. The resulting water is of prime quality equalling potable water standards. The technology can be adapted to most mining operations.

Sep 12, 2011

By Oliver Bowles, Carl A. Gnam

THE construction industry normally contributes extensively to the general economic welfare of all sections of the country. Billions of dollars are spent for materials and labor, and the success or failure of many business enterprises depends upon the volume of construction. The steel, aluminum, copper, cement, brick and tile, lime, gypsum, stone, sand and gravel, and several of the less prominent mineral industries are vitally concerned. Of great interest, therefore, is the accumulation of needed construction following the relative inactivity of the past five years, the recent moderate revival in building, and the prospect of a broader and more definite upturn. One may judge the magnitude of possible expenditure for construction by what has occurred in the past. The peak years were 1925 to 1928, inclusive, when the annual values of con- tracts awarded amounted to over six billion dollars. In marked contrast was the 1933 total of about 1% billion, the lowest level shown in the Federal Reserve Board Index, which goes back to 1919, and the more favorable 1935 figure of about 1.7 billion. An increase of nearly four billion over the 1935 volume would be necessary to equal the peak year 1928.

Jan 1, 1936

By Carl L. Morris

This short dissertation concerning "what the client expects from the engineer" is directed mainly at the design and construction of metallic ore concentration or beneficiation plants. However, practically the same conditions apply to the design and construction of cement and lime manufacturing facilities, with the exception that the latter facilities reflect the client's and engineer's concepts of customer service and in some cases reflect promotional considerations for the product manufactured and distributed. The client expects his engineering contractor to contribute in an efficient, cooperative, and economical manner current industry-wide know-how and experience to the specific project under consideration through the client's organization

Jan 1, 1969

By W. B. Plank

I HAVE been asked by the Chairman of the Engineering Education Committee to outline what the engineering colleges would like the mining companies to do with the young engineer just, out of college. It has been suggested that, because my own personal experience has been almost entirely within the coal industry, I handle this subject from that view- point. Many thoughtful engineering educators are today wondering what effect the present employment policies of many industrial companies are going to have on the young man just starting out in his profession. Since before the World War large industrial concerns, such as those in the electrical and mechanical industries, have gone to the colleges to interview 'likely graduates until today there has developed in most of our engineering colleges, especially in the eastern part of the country, what appears to be a lively competition on the part of these companies in bidding for the young graduate engineer. The employers of mining engineers, with one or two exceptions, have not yet begun to enter this competition. It remains to be seen how serious this situation will become, how it will affect the training of other engineers, and what effect, if any, it will have on the mind of the young man about to enter college who may be inclined to take up mining engineering, but who gains the impression from this well advertised employment service just mentioned that there is no opportunity for him in the mineral industry as com- pared with the opportunities offered in say civil, mechanical, and electrical engineering.

Jan 1, 1929