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By E. Kendall Cork

The traditional financial objective for a single mine company has been to operate as frugally as possible and to pay out most of the earnings as dividends. If the business is cyclical (as it is for most metals) the dividends might fluctuate quite widely. When the mine is exhausted the company disappears. This is still quite a viable strategy for a single mine company. It is not however a viable strategy for the world as a whole. The mining industry is built by mine development companies who can mobilize the people and capital to bring new mines into production. Their skills must include marketing, engineering, finance and other politics. It is very rare for a property to be brought in without the support of a major company that can provide all these services. The exceptions will usually have some other form of big brother support, for example the U.S. government uranium contracts at guaranteed generous prices. The mine development company will seek as a minimum to perpetuate itself by developing new mines in order to replace those which are running out. The more common and more ambitious objective is to grow -- that is to add to its ore reserves and current production by developing more new mines. The financial objectives for that company are very different. Obviously if all the earnings were paid out in dividends there would be nothing left to work with. The first financial policy then is to spend an appropriate amount on exploration for new properties. The next is to retain enough of the earnings to provide the capital for new projects at least sufficient for the equity. There is no magic formula as to what proportion of earnings should properly be distributed as dividends by a growth-oriented mine development company. As a rough rule of thumb distributing half or more will probably leave too little to work on and 30% or so is probably a good balance. However the circumstances differ widely from company to company. It may be useful to set an objective for the rate of growth of a company's earnings. Some have picked rates such as 15% per annum compounded. Others have set a target in real terms which might appear as 10 or 11% plus inflation. Obviously the arithmetic of compound interest is very attractive; however in practice there is much variation. Indeed current returns from existing operations swing widely with the business cycle and there is no assurance that economic new properties will be found according to someone's arbitrary time schedule. For example, Western Mining Corporation Limited in Australia explored for 30 years with little to show for it, but then found the great Australian nickel deposits and more recently the huge Roxby Downs copper. That long dry spell could not have fitted anyone's arbitrary calendar of growth and yet they would not have found such orebodies without that long period of effort. Should they have abandoned the search? Once a new property has been found or acquired there has to be a threshold rate of return on the new capital to be invested against which to evaluate the property's economics. Conventionally this seems to be 15% after tax, a number common in other heavy industries as well. In some cases it is expressed as a lower number plus allowance for inflation. Discounted cash flow analysis is a very useful tool but it does not make the decision. In the end a "go" decision depends on judgment of many factors some of which are numbers used in the DCF calculation whose credibility must be examined. It is curious how frequently investment proposals come in with the rates of return very close to 15%. The project advocates know that a number much less than 15% will not fly and that a number much more is not necessary. With much higher nominal and real interest rates of recent years, even though before tax, logic suggests that the hurdle rate should also rise. The power of compound interest is so great that 20% is very hard to achieve in any cash flow projection but 18% may be a sensible yard - stick. Once again it is remarkable how many project proposals come in with an 18% return. On the record the mining industry as a whole has not been overly restrictive in choosing its hurdle rates of return. This is shown by the abundance of metals in recent years and the failure of metal prices to keep up with inflation. All of the foregoing is standard text book stuff.

Jan 1, 1985

By Mark E. Emerson

INTRODUCTION A long time has passed since geologists encountered encouraging mineralization in their regional exploration program for base metals deposits. Detailed drilling during the following two field seasons served to delineate the configuration of the deposit. Various statistical techniques were employed to provide confidence levels regarding the extent of the reserves and to categorize them according to whether proved, indicated or inferred. At this juncture, it appears that the company has an orebody. Time elapsed? - three years; money spent? - $2.5 million. Much remains to be done before the orebody becomes a mine. The company urgently needs to develop new orebodies to replace its existing mines which are being depleted. It therefore has expended sizable amounts in exploration, the life blood of the company. A staff of specialists is maintained to evaluate new projects and to conduct feasibility studies. The scale of new mining projects today is beyond the resources of most mining companies. Bank financing, therefore, is often vital if the company is to survive. The following scenario describes how a company goes about evaluating mine projects and what is needed to meet lender's criteria in securing the needed financing. MINE PLANNING Now that the company engineers have taken over the project, their concern is no longer with finding ore but in developing it. An exploration shaft has been put down and a tunnel driven into the orebody to verify, on a large scale, what has been seen so far only in pencil- like drill cores. A large tonnage bulk sample is mined and shipped off to an independent metallurgical process laboratory for beneficiation testing. The budget is expended to cover engineering studies. Preliminary capical and operating costs are developed in- house and profitability studies are made based or1 assumptions concerning the markets for the main product and the indicated gold, silver, and other by-products. Time elapsed? - four years; cost to date? - $3.5-$4.5 million. The staff prepares its own pre-feasibility study. After review, the Executive Committee authorizes management to proceed with full-scale studies. The task is to make preliminary designs and to develop definitive capital and operating cost estimates. Specialized consultants will be engaged to study slope stability for the open pit and rock strength if underground recovery proves more feasible. If it is near the sea, an oceanographic report might be commissioned to see if the tailings can be disposed of off shore. Environmental impact studies are commissioned from a firm familiar with government requirements and regulations in this important area. The company subscribes for an expensive multi-client study of the supply- demand-price outlook for the product to support its own long-range price forecast. Now all the numbers are available to make a definitive appraisal of the value of the project. Cash flow analyses and sensitivity studies follow. Reams of computer printouts are generated. Time elapsed: five years. Amount spent? - up to $9 million, depending on the size, complexity and attractiveness of the project. Marginal projects always take longer. Finally, an engineering and construction (E&C) company is given the task of integrating and compiling all the data into a feasibility study. The results of dozens of reports, memoranda, computer printouts, and charts are boiled down to one final summary report of a few hundred pages together with conclusions and recommendations. After thoughtful review at a board meeting, the directors authorize management to proceed with detailed engineering work - provided that

Jan 1, 1985

By A. Roy MacLean

"In the Maritimes, there are twelve coal areas. From east to west, these include the Sydney coal field, the St. Rose - Chimney Corner, Inverness, Mabou, Port Hood, Pictou, Colchester - Debert, Springhill, Joggins - Chignecto, Beersville, Lake Stream, and Minto. The first eight are in Nova Scotia while the remaining four are in New Brunswick.In all these areas, the coal was formed during the Carboniferous period, which existed some 300 million years ago. However, within this period not all coal formation took place during the same time. There were three main intervals, which occurred at the time that the Riversdale, Cumberland and Pictou groups were laid down (Hacquebard, 1970). The oldest coals are those of the Riversdale Group. These coals were of rather limited extent, and only a few mineable seams are present, particularly at St. Rose -Chimney Corner and Port Hood. From these two areas only 2 M tons have been extracted, and 'measured' resources of 7 and 9 M tons respectively remain. The Cumberland Group coals are confined to Cumberland County and include the coals of Springhill and Joggins River Herbert -Chignecto. Some 43 M tons have been removed and only 7 M tons of 'measured' coal remain, with an addit10nal 39 M tons of 'inferred' resources. However, there are additional resources at Springhill, which will be discussed in more detail in a later section. The coals of the Pictou Group are the youngest and the most abundant, both in actual number of seams and in regional distnbution. These coals were formed during the Westphalian C and D, a time during which the main coal deposition in Europe also took place. Here belong the coals of the Sydney, Inverness, Mabou, Pictou, Debert, Beersville, Lake Stream and Minto fields. Their total production amounted to 469 M tons or 91 % of the Maritime total of 514 M tons. The remaining resources of all Pictou Group coals have been calculated at 254 M tons of 'measured' coal and 949 M tons of 'inferred' coal. As can readily be seen, the bulk of both past production and remaining resources occur in the Sydney coal field. The Sydney figures represent 73% of total production, and 87% of total 'demonstrated' resources in the Maritime Provinces. Next to Sydney, the Pictou coal field has been the greatest producer, with 59 M tons; it also has the second largest 'measured' resources, amounting to 25 M tons. However in terms of 'inferred' coal resources, the Mabou coal field, ~ith 140 M tons, ranks second to Sydney."

Jan 1, 1985

By R. A. Hevia

Florida Power and Light is the fifth largest investor-owned electric utility in the country. It has a service territory that covers 35 counties, or 28,000 square miles, 2.5 million customers, and serves 5.6 million people. The total installed capacity is 13,470 MW, generated by four nuclear units, 36 oil and/or gas fired units, and 48 gas turbine units. Traditionally, FPL has been an oil-based utility. In 1979, this dependency on oil became obvious when 42 million barrels of oil were burned during the year. At that time, it was also projected that, based on the current estimates of customer growth and available generation capacity through 1990, FPL's residual fuel oil consumption would increase from the 1979 level of 42 million barrels (6.7 million m3) per year to approximately 55 million barrels (8.7 million m3) per year by the mid-1990's. Concern over this was further aggravated by the fact that it was difficult to estimate both the price and quantity of fuel oil that would be available over the next decade since changes in the world market, decisions by oil producers and refiners, and international political developments would all affect the availability of oil. Also, at that time, the price of residual fuel oil had increased drastically, and there was no reason to think that these prices would soon stabilize. Thus, oil back-out became a primary objective of FPL and since then, FPL has been actively investigating ways to decrease fuel oil consumption.

Jan 1, 1985

By W. W. Roepke

The Bureau of Mines has developed an interactive computer program that enables mine operators and others to identify the effect of cut-ting system changes on relative dustiness at the face. The program, which simultaneously evaluates machine parameters, coal seam parame-ters, and operator-controllable parameters, was developed for use on any microcomputer using BASIC programming language. The program allows the user to change one or more of the cutting system parameters at a time to see how these changes affect relative dustiness. A complete program listing and flowchart are included along with operating in-structions and sample outputs. An example showing how to use the program is also included.

Jan 1, 1985

By Peter Tegart

The discovery of gold in the Toodoggone River area is credited to Charles McClair who mined placer deposits in 1925, reportedly valued at $17,500. After he and his partner went missing in 1927, efforts to relocate their workings resulted in the formation of Two Brothers Valley Gold Mines Ltd. in 1933, in which the legendary Grant McConachie (first president of CP Air) played an active role. This was the age when the prospector first utilized the airplane to reconnoitre remote areas. What greeted the observer from the air was an area rich in orange and yellow colours characteristic of gossans formed by the oxidation of sulphides. However, Samuel Black, a Hudson Bay Company fur trader, had also noted in his diary as early as 1824, the unusual and many gossanous colours in the headwaters of the Finlay River. These gossans, coupled with white limestone bluffs and the presence of placer gold, attracted the first reconnaissance of the area by Cominco in 1929. Cominco was ever active in remote areas at this time. They staked and worked several base-metal showings hosted by limestone at the margins of intrusive stocks. These early workers also obtained erratic high gold assays from chalcedony float samples found in creeks draining into the Toodoggone River. However, because the samples gave inconsistent assays, no concerted effort was made to locate their source. Except for the occasional horse-supported prospecting party of the late 1940s and early 1950s, the area did not receive much attention until 1968. Work until this time focused on the base metal lead-zinc showings which contained attractive silver credits. Gold was not an attraction because of the set price established by the US government. The late 1960s saw the northward expansion of porphyry copper exploration into the Toodoggone. A program of gossan soil sampling (gossans which had attracted the early workers) was carried out by Kennco Explorations (Western) Ltd. in 1966-1967. They analysed for base metals in the field, using a cold extraction method. The Kemess copper- gold prospect was staked as a result of anomalous copper values from this early geochemical program. In 1968, Kennco continued the program of silt traversing and field geochemical testing. The samples were further subjected to multielement analysis consisting of copper, molybdenum, lead, zinc, cobalt, nickel, and silver at Kennco's North Vancouver laboratory. Several anomalous creeks, high in combinations of copper, molybdenum, and silver, were outlined. Some initial soil grids were also established. The fall of 1969 saw the return of Kennco prospector Gordon Davies and geologist Bob Stevenson to check out a well-defined molybdenum, scattered copper and silver anomaly in soils from a grid on the Chappelle claims. The subsequent analysis of several selected quartz felsenmeer floats yielded one assay which ran in the order of 0.25 kg/t (8 oz per st) gold and 2.2 kg/t (70 oz per st) silver. Subsequent trenching on the Chappelle claims exposed the source of float in a 4- m (134) wide vein of high grade gold-silver mineralization. These results led quickly to the realization that the district had precious metal potential. Subsequent exploration in the period 1969-1974 by Kennco resulted in the discovery of most of the gold and silver occurrences on the Chappelle and Lawyers properties. Several other gold and silver occurrences were found in this district by Cordilleran, Cominco, and Sumitomo, working the district during this period. Conwest optioned the Chappelle in 1973 and explored underground by adit entry as part of a one-year program. In 1974, Du Pont of Canada Exploration Ltd. optioned the Chappelle claims and in March 1980, using reserves developed on the A vein, placed the Baker mine into production at a rate of 90.7 Vd (100 stpd). The Amethyst zone on the Lawyers property, 8 km (5 miles) north of Chappelle, was found in 1973 by Kennco using continued, persistent followup prospecting of silver silt geochemical anomalies. A silt anomaly in the order of 3.4 ppm silver occurred in a stream flowing 300 m (984 ft)

Jan 1, 1985

By F. Grant

"General *The mining experiences of the coal mining industry in Western Canada have been extremely varied, with the mining companies having to adjust their operations or fail due to the harsh economy of the country in the first part of the century. The bituminous or mountain mines had the railways as main consumers with, at times, optimism that potential steel producers would require metallurgical coal. The prairie and foothills mines mainly provided household fuels, with the fine coal sold to local thermal power plants at discounted prices. In practically all cases fuel competition was very keen, and the less successful mines ceased operations in short-time spans. Knowledge of the parameters that governed the success or failures of the past coal operations should be of value to the present and future mining companies. The initial coal mines were small and were started to supply local demand. These mines had little in the way of capital machinery, engineering, or transportation equipment; therefore the mining methods and mine plans were very simple. The first industrial-sized mines imported most of their management and mining methods from other mining areas, mainly Great Britain. It took time to change the bias of management and mining methods to the requirements of strata characteristics, with rapid closure to those mines that were slow to adapt working methods. The main markets for coal were for household fuel, thermal power plants and railways, with very few other industrial markets developed. The economy of the period was harsh and cyclic and the coal mines were affected more than most industries by these boom and bust periods. It led to the survival of the fittest or the most efficient. Due to the economy, mechanization was introduced to the mines very slowly, with the inability to sell coal fines at a profit being another reason for the delay. Manual labour with hand tools was the main means of production. The work was heavy and arduous, and the pay was based on contract coal tonnage; therefore both men and management paid close attention to details so that nonessential work could be eliminated. Mine openings were dimensioned so that coal could be loaded easily by hand and support requirements were kept to the minimum. Transporting and handling the timber supports required heavy labour; thus the most efficient dimensions were chosen to suit the strata. On the other hand, during the main production seasons the mines tried to make the strata stress work for them so that the pressure was kept on the coal face to keep the coal loose while the strata, a short distance back, was induced to cave to minimize the abutment stresses. This caused mining to be an art, using skills developed by experience with the strata. This led to the development of efficient mine layouts with the openings dimensioned to the strength of the strata and the type of support available. The lack of capital and mechanization, and the manual labour, induced the mines to correlate their service and haulage systems with their mining methods. This caused many innovations that proved very practical."

Jan 1, 1985

By O. Forsén

In the first part of this paper is studied the behaviour of small amounts of impurity elements? in the solidification of copper anodes. In the second part the dissolution of these impure anodes in sulphate based electrolysis is discussed. The first part is introduced with practical examples, the .model of solidification of impurities during the solidification of anode copper. According to this model the solidification structures of anode copper are strongly influenced by both thermodynamic and kinetic factors. Thermodynamics determine the microstructure of anode copper, but kinetics can alter the composition of melt to such that there is formed unequilibrium structures during the solidification, especially when the residual melt is solidified. The electrolysis experiments have clarified the behaviour of impuririties in the electrochemical dissolution in sulphate. Based copper electrolysis. In this study it is widely investigated to what extent any impurity elements or oxides will dissolve. In copper electrorefining. With the aid of the electrochemtcal experiments it was possible to fulfil quantitatively the qualitative results accomplished by microstructure studies.

Jan 1, 1985

By J. M. Barker

New Mexico is the leading domestic producer of perlite, a hydrated volcanic glass that can be expanded thermally to form a white, very porous, lightweight material. The United States is the leading consumer and producer of perlite in the world (Pettifer 1981). New Mexico produced, at five mines (Fig. 1), about 86% of all domestic crude ore mined in 1984 (Meisinger, 1985). Perlite is mined in 6 other western states, ore is expanded in 33 states, and the expanded ore is consumed in all states (Meisinger, 1985). Gross value of domestic ore mined in 1984 was about $16,500,000 (FOB mine; Meisinger, 1985) with much value added by expansion and processing prior to sale to end users. In contrast to the ubiquitous nature of perlite products in the U.S. economy, facilities for testing perlite ore, expanded perlite, and perlite products are notably lacking on a commercial, cost-effective, or readily accessible basis. The New Mexico Bureau of Mines and Min¬eral Resources (NMBM&MR) established a perlite¬testing facility in 1984 to mitigate this lack and to further the mining of perlite in the state.

Jan 1, 1985

By David A. Zegeer

It's a pleasure to be here, and an honor to be invited to address this distinguished group of professionals. Today, I'd like to begin with an overview of progress in coal mine safety and health. I'll discuss some current areas of concern. And I'll make some suggestions as to where we may be headed in the future. This year marks the coal industry's 15th anniversary under the Coal Mine Safety and Health Act, which took effect in 1970. We have come a long way in those 15 years. As a coal mining man from way back, I remember the era when the Coal Mine Safety and Health Act first was passed. Some of you may remember it, too. At that time, the safety and health of coal miners was in the public eye even more than it is at present. One reason was a mine explosion that killed 78 miners when it occurred in a large underground coal mine in November 1968. That disaster raised tremendous public concern about protecting the safety of miners.

Jan 1, 1985

By T. R. A. Davey

A simple model for metal solution behaviour may be derived, on the basis of dilute solution solubilities (where? log concentration of solute varies linearly with reciprocal temperature) and not-so-dilute region solubilities (where the log of the alpha-function at saturation frequently varies linearly with reciprocal temperature) and assuming activity to vary according to the quadratic formalism in between. Matte binary systems usually exhibit regular .solution behaviour when the constituent species are chosen appropriately. In many recent papers, metal solubilities in .slags are expressed as the sum of several different and supposedly independant molecular species (e.g. oxides, sulfides, chlorides), Such a view is untenable because of the now proven ionic nature of slags. Some possible reasons for the great effect of sulfur on copper solubilities in slags are discussed.

Jan 1, 1985

By Anthony Tuke

Members of the Society of Mining Engineers may well regard it as rather unusual that a paper on this subject is being presented by someone whose first taste of mining came at the age of 60 or so - someone who last heard of cathodes and anodes in 1938. On the other hand, the title does refer to the financing of a mine and at least I can claim to have spent all my business life since the war until 1981 in the world of banking, though this inevitably means that I have been used to looking at these and other problems through what you might regard as the wrong end of the telescope. The lending of money, and more particularly the provision of finance for commerce and industry, is the central job of a banker and I have been involved in this in various ways over many years, but regrettably only very marginally in the world of mining. As you will see from what follows, the rather specialised form of finance which RTZ required was, to my regret, not provided by the British banking community since the great majority of the finance came from American banks and, to a lesser extent, from German banks. I am most indebted to Mr. Roy Wright for a great deal of the nuts and bolts in this paper. He was one of the three central figures in the growth and expansion of RTZ during the 1950's and 1960's and was right at the centre of the negotiations with bankers, with governments and with many others. The going, as you will see, was far from easy. The essential basis for the financing of each of the RTZ group's mining projects was a firm long-term sales contract for sufficient of the output of the particular mine to produce the cash flow necessary to service the loans. Wherever possible, loans were raised in the same currency as the sales contracts were made. Each sales contract was designed to give the customer the product he wanted with a long-term assurance of supply and at the same time to give the bankers the protection they required. Thus the marketing concept and the financing concept for a particular mine formed one overall plan, and talks with the customers and the bankers were conducted in parallel until a satisfactory marketing/financial package was agreed in principle. Preliminary talks were begun soon after the discovery of a potentially viable orebody. As confidence about a discovery increased, customers were persuaded to enter into contingent sales contracts before the very detailed and costly business of the economic and technical feasibility study of the mine was launched; such a study might cost 10% or more of the estimated total capital cost. At the same time provisional understandings were reached with the bankers. The contingent sales contracts usually gave a period of grace of eighteen months to two years, during which time the decision whether or not to continue with the mine had to be made. This decision rested mainly on the result of the feasibility study and also on coming to a firm agreement with the bankers. If all went well and the mine went ahead, then the contingent sales contracts became firm, but they fell away if the decision was negative. The Company was fortunate that during the whole period when its major mines were being developed, world trade was increasing rapidly and Japan was becoming a dominant industrial power. The Japanese supported many of the mines, including Hamersley Iron Ore, Lornex Copper, Bougainville Copper to name a few, with the basic long-term sales contracts that enabled their development. The Germans supported Palabora and to a lesser extent Bougainville. The mines were financed as individual projects generally with a loan/equity ratio of about 65/35, without legal recourse to RTZ for the loans. RTZ was, however, responsible for providing any capital overruns required to bring the mines into commercial operations. Nevertheless, the RTZ management regarded itself as morally responsible to the lenders because, Palabora aside, the sales contracts had either a fixed selling price (like Hamersley), an indexed price (like the Elliot Lake Uranium Mines and Mary Kathleen), or a floor price (as in Lornex, Bougainville and Rossing). Thus the Company believed that any financial failure would have been due to poor management or technical

Jan 1, 1985

By Robert B. Parsons

"1984 was an eventful year in the courthouse f or observers 0/ the mining tax scene in Canada. For the first time in a number of years, the Federal Court heard several important tax cases which pertain directly to the resource industries. Tax Notes discusses/our cases that could affect the taxation 0/ operations and investment in the mining sector.Capital Gain or Income?Ever since tax reform, risk-takers in the exploration business have maintained that the taxation of capital gain s is a significant impediment to raising risk capital. It must be akin to rubbing salt in the wound, then, when an entrepreneur sells shares and the Court upholds Revenue Ca nada taxing the gain as ordinary income instead of capital gain. But, this is precisely what happened in the case of The Estate of Murray Watts, et al. v. The Queen.The issue that had to be decided by the Federal Court, Tri al Division, in this case was whether or not the profit from the sale of shares in Hearne Coppermine Exploration s Limited in 1968 was a capital gain, or income subject to tax.Hearne was incorporated in July, 1967. At that time, the three plaintiff s, together with seven other individuals, subscribed for 400,000 shares at 10 a share. The plaintiff subsequently subscribed for an additional 500,000 shares at $1.A pooling agreement was entered into by all ten shareholders regulating the disposition of any o f their shares; any sale required approval of seven of the ten initial sub scribers. It also provided for the sale of their shares 30 days after any public offering."

Jan 1, 1985

By Keith Harris

The U.S. economy grew moderately in the second quarter of 1985 with real gross national product (GNP) recording a seasonally adjusted annual growth rate of 2.0%, up from the 0.3% growth of the previous quarter but significantly below the 7.1% growth of the second quarter of 1984 (table I). Personal consumption expenditures grew 5.3%, with purchases of durable and nondurable goods rising 7.4% and 5.1 %, respectively; nonresidential and residential fixed investment--the two components of fixed investment--grew 11.8% and 5.6%, respectively; and Government spending rose 3.6%. However, these gains were tempered by a major decline in the growth of business inventories (from $19.1 billion to $8.3 billion) and the continuing growth of the net export deficit (from -$28.4 billion to -$33.3 billion). While the high value of the dollar compared with other currencies has been a major cause of the expanding trade deficit, its value, as measured by the monthly Federal Reserve Board (FRB) multilateral trade-weighted dollar index, has declined over 17 index points from its February peak to 140.94 in July. The July dollar value was still high historically. The rate of inflation, as measured by the fixed-weighted price index for GNP, remained low at 4.1%, down from 4.3% in the first quarter, and employment continued to grow at a rate sufficient to keep up with new additions to the labor force. Civilian unemployment has remained steady at 7.3% over the past 6 months. Industry Statistics The FRB recently revised its index of industrial production and changed the base year from 1967 to 1977,1/ The revised total index shows a 0.1 % higher annual growth rate between 1967 and 1984 than the previous index. In the slower growing or declining industries, such as metal mining, primary metals, and fabricated metals, however, downward revisions in the indices and rates of growth have occurred. The previous and revised annual rates of growth between 1977 and 1984 for several of the sectors of interest to the mining industry are shown in table 2.

Jan 1, 1985

By B. W. Haynes

This Bureau of Mines report describes the laboratory processing of manganese nodules and the results of tailings characterization obtained during the cooperative program with the Department of Commerce's National Oceanic and Atmospheric Administration (NOAA) and the Bureau. Five technically feasible first-generation nodule processing methods were operated at bench scale to generate sufficient tailings and slags for physical and chemical analyses. A description is given for the laboratory operation of the individual unit operations of each process. The laboratory-generated tailings and slags were tested for physical properties, mineral content, elemental and ion content, and leachability for all five processes. The results of leachate testing using the Environmental Protection Agency extraction procedure (EP) toxicity test, the American Society for Testing and Materials shake extraction test, and the EPA-U.S. Army Corps of Engineers seawater elutriant test showed very low to negligible leaching of metals from the tailings and slags. Results of the EP toxicity test demonstrated that the wastes are nonhazardous as defined in the Resource Conservation and Recovery Act (Public Law 94-580).

Jan 1, 1985

By R. H. Lien

The Bureau of Mines investigated a roast-leach process for recovering a marketable lithium product from a montmorillonite-type clay deposit located on the Nevada-Oregon border. The clay sample treated in the investigation contained 0.6 wt pct Li. The lithium recovery process consisted of several unit operations. The lithium silicate compounds in the clay were converted to Li2SO4 by roasting a pelletized mixture of clay, limestone, and gypsum at 900° C in a direct-gas-fired rotary roaster. Water--leaching the calcine at 40 pct solids extracted the Li2SO4. Lithium recovery from the leach solution involved concentrating the solution by evaporation, adding Na2CO3 to the concentrated solution to precipitate Li2CO3 , and filtering the slurry to obtain the product. The product filtrate was recycled to the evaporator following a crystallization step. About 80 pct of the lithium in the clay was recovered as 99-pct-pure Li2CO3. Process operating costs were estimated at $2.12/lb Li2CO3 produced; the current Li2CO3 selling price is $1.48/lb. Raw materials. accounted for 30 pct of the total operating cost.

Jan 1, 1985

Andy H. Vassiliou – Introduction Ladies and gentlemen,.good evening and welcome to the Paul F. Kerr Memorial Symposium dinner. I believe we are all here to honor the memory of a great teacher and advisor, and a true friend -- Professor Kerr, or Dr. Kerr, or to most of us who were his students, "Pappy" Kerr. Most of us who attended the Paul F. Kerr Memorial Symposium earlier today at the New York Hilton had the opportunity to read, or listen to, or discuss scientific papers presented in honor of Dr. Kerr. In addition, all of the speakers had the opportunity to reminisce about their association with Dr. Kerr, who was credited as having contributed substantially to their graduate education and the development of their careers. Dr. Kerr's two daughters -- Ruth and Nancy -- who attended the Symposium at the Hilton are also here with us tonight. I think we should keep tonight's festivities on an informal basis since we are all old friends or former students of Dr. Kerr. Some of us may want to say a few words about our experiences at the time we were students at Columbia, and hopefully include some anecdotes relating to Professor Kerr. I would like to invite everyone to do so, but first we have arranged for two of us to be the lead speakers, whom I will introduce in a few moments.

Jan 1, 1985

By Joseph E. Worthington

The present-day Northumberland gold mine is one of the deposits generally characterized as a Carlin-type occurrence. It lies at the crest of the Toquima Range in Nye County near the center of Nevada. Gold mineralization occurs in two modes, in argillaceous and in silicified limestones, and is generally very fine-grained or micron gold. The Northumberland district has had a history that is typical of many western gold districts: minor production prior to World War II and intermittent exploration thereafter until a combination of geological insight, improved economics, and the advent of heap leach technology created the Northumberland gold mine. Nye County, Nevada, was sparsely populated and little explored in the early years of the settlement of the west; the Northumberland district was not established until 1866. Initial interest was in silver and the district operated as a very small producer for the next seventy years. The disseminated gold occurrences in silicified limestones were recognized and Northumberland Mining Co. was organized to develop the property in the late 1930s. Northumberland Mining Co. actually conducted drilling operations (over 200 drill holes) and mined from small open pits in the silicified limestones. They ultimately produced almost 936 kg (33,000 oz) gold before being shut down by War Production Board Order L-208 in 1942. After World War II gold mining activities were essentially nil for over a decade due to the poor economics of gold production. The property was, however, a known gold producer and attracted recurrent exploration attention. About 45 holes were drilled under the direction of Peter Joralemon for private interests between 1959 and 1963. Next Kerr McGee drilled about 25 holes during 1963 and 1964. Some- what later, in 1968, Homestake drilled 20 holes. The property was then acquired by Idaho Mining Co. which drilled about 30 more holes between 1972 and 1974. By this time the Northumberland mine was becoming somewhat shopworn with over 300 holes drilled. Interest in gold prospects was increasing substantially in Nevada, how- ever, due to rising gold prices in late 1974, and several companies were interested in continuing exploration at Northumberland. In 1975 Cyprus Mines Corp. was successful in obtaining a joint venture arrangement with Idaho Mining Co. for further exploration and development of the property. The overall Cyprus exploration program was under the direction of James G. Hansen, Vice President Exploration. The geologist recommending acquisition of Northumberland was Peter E. Chapman who reported to Joseph E. Worthington, Manager of U.S. Exploration for Cyprus. The basis for selection of the Northumberland mine as an exploration target for Cyprus by Chapman was essentially prior knowledge of regional and 16cal geology and of the mine. Exploration for the next few years was directed by Chapman under the supervision of Worthington. During 1975 and 1976 rotary and check core drilling were conducted that indicated that a substantial Carlin-type or disseminated, low-grade gold deposit occurred in two separate bodies. Drilling was based on geologic mapping and rock chip geochemical sampling. Both ore zones were reflected at the surface as gold and arsenic anomalies in rock chips. Heap leach tests attempted in 1977 were aborted by a flash flood, but were completed in 1978. Engineering studies occupied the next couple of years until the property achieved production in the fall of 1981. It is now producing by open-pit mining with gold recovery by heap leaching and cyanide extraction at a rated capacity of approximately 2722 t/d (3000 stpd) ore. Metal recovery has been projected (probably conservatively) at 5 10 kg/a (18,000 oz per year) gold and 1.6 Mg/a (59,000 oz per year) silver. Reserves are reported to be adequate for ten to fifteen years of production. REFERENCES Anon., 1981, "Gold in Nevada," Span Magazine, Vol. 21, No. 3, Standard Oil Co., pp. 6-9. Koschman, A.H. and Bergendahl, M.H., 1968, "Principal Gold- producing Districts of the United States, Professional Paper 610, US Geological Survey, p. 193. Kral, V.E., 195 1, "Minerals Resources of Nye County, Nevada, Bulletin, Vol. 45, No. 3, Geology and Mining Series 50, Nevada University.

Jan 1, 1985

By David A. Gulley, William A. Vogely

INTRODUCTION The Scope of the Chapter This chapter discusses environmental regulation and closely-related public policies associated with mineral development in the United States. This chapter outlines the nature, extent, and amelioration of secondary effects of mineral development. It sketches the policy foundations of regulation; discusses the implementation of environmental law; describes land use conflicts and land management regimes; and surveys the costs and benefits of environmental regulation. Since regulations are subject to frequent change, the chapter emphasizes basic factual and conceptual material, rather than specific regulations. The goal is to familiarize the reader with the general nature of environmental impacts and mitigation which arise in the minerals industry, and with the issues surrounding the regulation debate. The chapter is organized as a series of sub- chapters. The first of these is a discussion of the conceptual foundations of regulatory policy. The second section summarizes the principal federal environmental statutes, and the implementation of such regulation. Following that, the third section summarizes the current state of knowledge regarding the types of environmental impacts associated with mineral development. This discussion, organized in a format similar to that used in environmental impact statements, can be thought of as a guide to reading and understanding such statements. Next, the fourth section surveys studies of the costs and benefits of environmental regulation. 'These empirical studies are evaluated in terms of the framework developed in the first section of the chapter. In the fifth section, the discussion turns to federal, state, and local approaches to land use control and siting, and the economic analysis of such conflicts. Included are discussions of the two principal forms of public lands mineral entry, the 1872 location patent system and the 1920 leasing approach. CONCEPTUAL FOUNDATIONS OF REGULATORY POLICY David A. Gulley The Role of Regulation in a Market Economy What is Regulation?: Regulation is the intervention of government in the activities of the private market. In a market society, the private sector is presumed to be the most appropriate economic agent. Given this presumption, regulation generally begins with a demonstration of persistent problems under laissez-faire in a given context. Environmental and related regulation occurs because the public believes the free market does not properly value environ- mental quality. In this section, concepts are advanced to aid the reader in understanding the government's role in this respect.

Jan 1, 1985

By Norman L. Weiss

The full importance of tailings disposal is yet to be realized by the mining industry, but our awareness of its present and future implications is growing faster, perhaps, than any single phase of ore processing. Few engineers can look very far into the future because of the complexity of the problems that may confront us if we project from the general indifference of past years through what we are already being expected to correct in existing operations, to confrontations with new statutes and an awakened public in any new plants hence- forth. The mistakes of the past have not been limited to the United States nor even to other countries of the Western Hemisphere. Indeed, all continents and subcontinents have suffered from myopia in releasing the tailings without retaining responsibility. However, the US as one of the world's great leaders in technology has a particularly unimpressive record. It may be safely generalized that the degree of control applied to the tailings of a milling operation has depended upon several factors more important than national boundaries. Thus in arid and semiarid climates no incentive was needed other than the scarcity of water to create a permanent and stable lodgment for mill tailings. On the other hand. where water has been plentiful. the temptation to let the tailings run into a river or lake or ocean (at least at certain times of the year) was often irresistible. So we find that modem tailings disposal in the southwest deserts of this country, with one or two notable exceptions where very serious breaks seem to occur at regular intervals, is satisfactory according to the standards of the 195QF and 1960s. while in various operations in Idaho, Michigan, western Colorado. Newfoundland, and elsewhere the record has been less praiseworthy. In the same way, cyanide plants which did not concern themselves about leakage, seepage, spillage, or wastage of tailings pulps with solutions containing toxic levels of free or combined cyanide soon heard a demand for better control. In consequence the industry has seen a growing use of cyanide regeneration of tailings or wash solutions, elimination of leakage, and careful structuring of tailing dams. The chemical and thermal qualities of tailing waters have occasionally been a spur to good tailings management. Some tailings disposal problems for example, the southeastern Florida phosphate clays and the Bayer red muds-have been given the intensive study they merited, but not always with much success.

Jan 1, 1985