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By C. Van Dyke, K. Van Dyke, J. Gutierrez, C. Nowack

"Using propidium assay and flow cytometry, we examined how silica exerts its toxicity toward phagocytic cells employing the human neutrophil as a model. This toxicity appears to be associated with calcium bound to silica. Once the silica with calcium is phagocytized, the extra calcium causes the death of the cell. Using ""Ca we found that 6 to 10% of millimolar calcium is bound to milligram amounts of respirable-sized silica (diameter of 5 µ.m or less) at physiological pH. If the silica particles arc coated with an organosilanc (Prosil 28). calcium binding is decreased by 60% as is cell death. Pretreating with INDO IAM (a chelator of intracellular calcium) reduces the cellular death by 80%. Nonfibrogcnic particles- polystyrene beads or coal dust-produced 10% or less cell death in a 4-h period. Silica with no added, external calcium appears to exert toxicity to neutrophils; however, pretreating cells with EDT A decreases cellular death to the level of nonfibrogcnic particles. Chronic toxicity with silica-calcium appears similar to the chronic toxicity in gout where particles cause a cycle of inflammation. c 1993 Academic Press, Inc.Silicosis is an occupational disease caused by the inhalation of fine particles of silica, usually between 0.1 and 5 µ.m in diameter (1). A recent hypothesis explaining silica's toxicity suggested that surface free radicals caused damage to cells (2). This explanation appears doubtful, however, since the addition of silica to water, such as that found in biological systems, quenches free radicals; also, such a hypothesis does not provide basis for a persistent inflammatory pattern that lasts for years. Kane et al. (3) proposed that silica's toxicity resulted from an excessive concentration of calcium ions within the phagocytic cell (macrophages). However, the mechanism that was capable of linking silica to an excess of intracellular, ionic calcium was not explained. The surface of silica is certainly involved because covering the surface with polymers or phospholipids decreases silica's toxicity (4-6).When silica is engulfed by macrophages platelet activating factor and leukotrienes are produced (7, 8). This is the same inflammatory pattern produced by phagocytic cells exposed to the calcium ionophore A23187 and ionic calcium. How could silica be acting like A23187? Perhaps calcium binds to silica extracellulary and then is released intracellulary following phagocytosis; the latter process, in a sense a ""piggy back"" process, would permit activation of inflammation and cell death mechanisms."

Nov 1, 1995

By J. H. Schloen

"One of the most important phases in Canada's relatively rapid development of its metal mining and refining industries was launched in 1928 when the directors of Noranda Mines Limited decided to establish an electrolytic copper refinery ""somewhere in Eastern Canada”. Noranda's president, J.Y. Murdoch, had already evolved the company's ""mine to market"" policy and was determined to prove the economic feasibility of refining Noranda copper in Canada. The time appeared to be ripe as buoyant business conditions continued into 1929. In addition, proven ore reserves at the Horne Mine in northwest Quebec had virtually tripled and the price of copper had reached a healthy 15 cents per pound. Letters Patent incorporating the company bearing the date February 6, 1929 had been granted by the Secretary of State in accordance with an application that specified a capital structure of $2 million divided into 20 000 shares with a value of $100 each. Noranda assumed 70% of the original investment in the proposed refinery, while the Nicholas Copper Company of New York (which later became Phelps Dodge Corporation) and British Metal Corporation Ltd. of London, England, each were responsible for 15%. Nicholas Copper Company agreed to supply the design and to supervise the construction of the refinery and British Metal Corporation would act as sales agent and market the refinery's products."

Jan 1, 1999

By James K. A. Harral

The growing national concern over energy has aroused a great deal of interest in the most efficient and least costly way to use our remaining fossil fuel reserves. A number of studies have been published which compare the overall thermal efficiency and cost of gas and electric energy. These studies have been carried out by a wide variety of organizations including Oak Ridge National Laboratory, The Rand Corporation, The Stanford Research Institute, and The Institute of Gas Technology. This paper is an attempt, by PGandE, a large combined gas and electric utility serving most of the northern and parts of central California, to compare the cost and efficiency of gas and electric energy for certain residential appliances using actual operating data and financial statistics for the year 1974, and thereby develop some guidelines for future energy developments utilizing these limited fossil resources. The appliances chosen for the study were kitchen ranges, clothes dryers, hot water and space heaters. These appliances were selected because they can be served with either gas or electricity and they account for approximately one-third of PGandE's total residential electric sales and nearly all of PGandE's residential gas sales.

Jan 1, 1976

By J Li, A McFarlane, J Yu, L L. Kuhar, R Meakin, N Chapman

"Column leach tests are used frequently to predict recoveries and reagent consumption for nickel laterite heap leaches. These column leaches often run for more than 100 days and therefore require long-term monitoring and data analysis to achieve the desired information. To minimise the cost and time required to obtain relevant information for nickel laterite heap leaching, we have developed a small-scale hydrogeometallurgical laboratory test to serve as a proxy to column, and by inference, heap leaching. In excess of 50 leach tests were conducted using four different small-scale proxy and column leach tests to compare predicted nickel recoveries, acid consumption and leach kinetics and to determine whether insight into potential scale-up effects can be obtained. The most promising proxy test was identified and we achieved a statistically significant recovery and acid consumption correlations between this test and the column leach tests. The accuracy of the small-scale tests was confirmed by column tests run on new laterite ores. This geometallurgical proxy could be of use for the population of block models and process selection during the mine planning phase or for optimisation and control during processing.CITATION:Li, J, Kuhar, L L, Meakin, R, Chapman, N, McFarlane, A and Yu, J, 2016. A Geometallurgical Proxy for Nickel Laterite Heap Leaching, in Proceedings The Third AusIMM International Geometallurgy Conference (GeoMet) 2016, pp 335–340 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Jun 15, 2016

By Frederick W. Breaks, Andrew G. Tindle, Julie B. Selway

"Abstract - Rare-element pegmatites may host several economic commodities, such as tantalum (Taoxide minerals), tin (cassiterite), lithium (ceramic-grade spodumene and petalite), and cesium (pollucite). Key geological features that are common to pegmatites in the Superior province of Ontario and Manitoba, Canada, and in other large tantalum deposits worldwide, can be used in exploration.An exploration project for rare-element pegmatites should begin with an examination of a regional geology map. Rare-element pegmatites occur along large regional-scale faults in greenschist and amphibolite facies metamorphic terranes. They are typically hosted by mafic metavolcanic or metasedimentary rocks, and are located near peraluminous granite plutons (A/CNK > 1.0). Once a peraluminous granite pluton has been identified, then the next step is to determine if the pluton is barren or fertile. Fertile granites have elevated rare element contents, Mg/Li ratio < 10, and Nb/Ta ratio < 8. They commonly contain blocky K-feldspar and green muscovite. Key fractionation indicators can be plotted on a map of the fertile granite pluton to determine the fractionation direction: presence of tourmaline, beryl, and ferrocolumbite; Mn content in garnet; Rb content in bulk K-feldspar; and Mg/Li and Nb/Ta ratios in bulk granite samples. Pegmatite dikes with the most economic potential for Li-Cs-Ta deposits occur the greatest distance (up to 10 km) from the parent granite.Metasomatized host rocks are an indication of a nearby rare-element pegmatite. Metasomatic aureoles can be identified by their geochemistry: elevated Li, Rb, Cs, B, and F contents; and by their mineralogy: presence of tourmaline, (Rb, Cs)-enriched biotite, holmquistite, muscovite, and rarely garnet.Once a pegmatite dike has been located, the next step is to assess its potential to contain Ta mineralization. Pegmatites with the highest degree of fractionation (and thus the most economic potential for Li-Cs-Ta) contain blocky K-feldspar with >3,000 ppm Rb, K/Rb < 30, and >100 ppm Cs; and coarsegrained green muscovite with >2,000 ppm Li, >10,000 ppm Rb, >500 ppm Cs, and >65 ppm Ta. Pegmatites with Ta mineralization usually contain Li-rich minerals (e.g., spodumene, petalite, lepidolite, elbaite, amblygonite, and lithiophilite) and may contain Cs-rich minerals (e.g., pollucite, Cs-rich beryl). The ore minerals of Ta are commonly manganotantalite, manganocolumbite, wodginite, and microlite; Ta-rich cassiterite is also commonly present. Tantalum mineralization tends to occur in albitic aplite, mica-rich (lepidolite, cleavelandite ± lepidolite), and spodumene/petalite pegmatite zones."

Jan 1, 2005

By D. R. Dolinar, J. Pablic, D. C. Oyler, T. P. Mucho

At a mine in central PA, high horizontal stresses have caused long running roof falls resulting in hazardous conditions for the miners and the premature abandonment of panels. Because of these conditions, the mine requested assistance of the National Institute for Occupational Safety and Health (NIOSH) in utilizing the "advance and relieve" method to mitigate the affects of horizontal stress on the mine roof. "Advance and relieve" mining involves the removal of a pillar or a portion of a pillar during development, thereby creating a cave along one side of the panel. Following cave development, the horizontal stress is relieved over the workings adjacent to the cave in the active panel. The mine has used this system in three panels with a significant reduction in stress damage and no large roof falls.

Jan 1, 2001

By D. R. Dolinar, J. Pablic, D. C. Oyler, T. P. Mucho

At a mine in central PA, high horizontal stresses have caused long running roof falls resulting in hazardous conditions for the miners and the premature abandonment of panels. Because of these conditions, the mine requested assistance of the National Institute for Occupational Safety and Health (NIOSH) in utilizing the &apos;advance and relieve method to mitigate the affects of horizontal stress on the mine roof. "Advance and relieve" mining involves the removal of a pillar or a portion of a pillar during development, thereby creating a cave along one side of the panel. Following cave development, the horizontal stress is relieved over the workings adjacent to the cave in the active panel. The mine has used this system in three panels with a significant reduction in stress damage and no large roof falls.

By D. R. Dollnar

At a mine in central PA, high horizontal stresses have caused long running roof falls resulting in hazardous conditions for the miners and the premature abandonment of panels. Because of these conditions, the mine requested assistance of the National Institute for Occupational Safety and Health (NIOSH) in utilizing the &apos;advance and relieve method to mitigate the affects of horizontal stress on the mine roof. "Advance and relieve" mining involves the removal of a pillar or a portion of a pillar during development, thereby creating a cave along one side of the panel. Following cave development, the horizontal stress is relieved over the workings adjacent to the cave in the active panel. The mine has used this system in three panels with a significant reduction in stress damage and no large roof falls.

Jan 1, 2002

By James R. Jones

The tempo of air pollution control regulations has increased dramatically in the past few years. Because coal mining operations are frequently located in remote areas away from urban developments, specific regulations applying to coal mines have received lower priority and are thus only now being promulgated and/or enforced. Therefore, many mine operators are not yet familiar with the regulations and the impact upon their method of operations. Few have been faced with an inspector on the property sighting them for specific violations. Several of the Mid-western states are just now requiring permit applications to be submitted.

Jan 1, 1973

By R. Carrier

"There has been a continuous evolution with the use of pre-cast concrete elements in the construction of aluminum smelters. In 1990, Phase I of Alouette was built using cast-in-place concrete exclusively. Whereas, other AP 30 technology plants such as Hillside 2 in the mid-1990s used pre-cast concrete beams with cast-in-place floors. Mozal 2, in 2002, used pre-cast concrete beams with pre-cast partial-slab operating floors. Alouette Phase II went further. Not only were the potroom building beams and floors pre-cast, but the entire pot support system, insulating walls and basement jersey walls were pre-cast. Once the techniques for bending and welding the reinforcement bars and the design for attaching electrical insulating plates to the concrete was perfected, the challenge for the project remained only in the logistics of transporting the pieces to site and simple erection. The overall impact on the project was dramatic. Using prefabricated concrete not only allowed advancement of the schedule, but totally eliminated formwork, re-bar installation, and form removal activities along with the handling of all the materials involved with these activities. With the elimination of these labour and material-intensive portions of the job, exposure to work injuries was dramatically reduced. The most prevalent activity for lost time accidents is during the rough work associated with concrete formwork, placing concrete and form removal. Another area where prefabricated elements were successfully used on Alouette Phase II was for the insulating walls enclosing the pot area, known as the ""claustra walls"". Usually these walls are constructed in-situ using mortar and breeze block. Success was also achieved with prefabrication of the perimetric walls that are installed at the lower floor of the potroom. A big advantage of using prefabricated concrete in the electrolysis area is in assuring electrical isolation for the operating floors. Poured concrete requires a meticulous clean-up effort before commissioning to establish the electrically ""floating"" characteristics of the operating floors. Poured concrete results in ""wash"", stray wood,"

Jan 1, 2006

By B Tutmez

Determination of stress-strain behaviour of rocks plays a crucial role in understanding the response of rocks during loading. However, it is a tedious, expensive and a time-consuming process to obtain such characteristics both in the laboratory and in situ. On the other hand, non-destructive testing methods such as ultrasonic velocities can produce a reliable and fast solution to indentify state of strain and stress in rocks. The present paper aims to provide insight into the relations amongst ultrasonic wave velocities, amplitudes and deformability properties of porous siltstone under compressive loading. For this purpose, pulse (vP) and shear wave velocities (vS) along with amplitudes (AP - AS), and applied loads with resultant strain were measured simultaneously so that response of siltstone to compression can be evaluated. In addition, initial vP and vS were recorded at the beginning of each test to calculate dynamic elastic properties of the specimens. This provided a comparison between static and dynamic elasticity properties of siltstone. Crack damage associated with the onset of dilation was also investigated. The results showed that there is a non-linear logarithmic relation between velocities and stress-strain level for siltstones.

Sep 26, 2011

By Lawrence F. Johnsen

In 1989, the Connecticut Department of Transportation authorized the evaluation and design for a reconstructed Route 1 bridge over the Quinnipiac River in the City of New Haven, Connecticut. The project extends from the intersection of Route 1 with East Street, easterly for approximately 3/4 mile to the intersection of Route 1 with Wheeler Street and Stiles Street. The reconstructed roadway will be relatively on-line and widened to provide for four lanes of vehicular traffic and a single-track railway line. The existing bascule bridge and approach spans, which were constructed in 1924, will be replaced by a 270-foot span lift bridge and new approach spans. The lift bridge will have a main lift span weighing approximately 3000 tons, second largest after the Burlington Northern Bridge over the Williamette River in Portland, Oregon. The new bridge will widen the navigation channel to 24 0 feet and provide vertical clearances of 13 feet when closed and 62 feet when open. The project is located in an industrial area. Adjacent properties include retail gasoline sales, auto repair, railroad transport and bulk storage of petroleum. Existing structures include the Yale Boathouse and several retaining walls serving as containment dikes for petroleum storage tanks. The Yale Boathouse, located on the east bank of the river, was constructed in 1909-1910 and is eligible for listing in the National Register of Historic Places.

Jan 1, 1993

By P Gomez, R Baumgartner, G Escobar

"The Cerro Corona mine consists of a Cu-Au porphyry deposit located in the Andes of northern Peru. The deposit comprises a typical Cu-Au multiphase porphyry mineralisation that has been overprinted by an epithermal event. This has generated a complex pattern of argillic alteration facies, which was accompanied by a locally structural-controlled Au-Cu mineralisation with the presence of gold and limited Cu sulfides and sulfosalts. These features, along with the porphyry-style mineralisation, produced a multifaceted occurrence of gold.Since the beginning of operations at Cerro Corona in 2008 there has been a continuous improvement of the geological and mineralogical knowledge. All mineralogical studies have mainly focused on host rock types and, to a lesser extent, alteration minerals, but little work has been done on the mineralisation itself. As a consequence, limited mineralogical information was available for use in the process optimisation initiatives.In the last two years, a series of mineralogical characterisation studies were undertaken with two main goals. First, to gain an understanding of the mineralisation genesis and second, to obtain a detailed characterisation of copper and gold minerals to support ongoing process optimisation. The first goal was achieved by conventional optical microscopy while the second required electronic microscopy and other microanalyses due to the necessity of quantifying several minerals of interest for the processing.The results were used to refine pre-existing geometallurgical domains, explain copper and gold losses in the flotation process and to some extent, improve copper and gold recoveries. The mineralogical characterisation is an ongoing work. Mineralogy provides the basis for any optimisation exercise since it looks in detail at the material to be treated and therefore, should be part of all geometallurgical programs.CITATION:Baumgartner, R, Gomez, P and Escobar, G, 2016. Comprehensive Mineralogical Characterisation at the Cerro Corona Cu-Au Porphyry Mine – the Fundamental Key for Geometallurgical Applications, in Proceedings The Third AusIMM International Geometallurgy Conference (GeoMet) 2016, pp 221–230 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Jun 15, 2016

By G. Taylor

"The Iron Ore Company Of Canada's Carol Project is located in Labrador City, Newfoundland. Labrador City is some 912 air kilometers northeast of Montreal, and 417 ratl kilometers north of Sept-Iles, Quebec.Over 2,800 employees work at the Carol Project to produce some 20.0 million tonnes of concentrate and 10.5 million tonnes of pellets annually.In 1979 our Training Department started to develop the DACUM System of training for our Concentrator Operations Department.DACUM is an individualized, self-learning, training program. It is both a curriculum plan and an evaluation instrument.To date, the DACUM System has been completed for all occupations in the concentrator and work will commence shortly to develop DACUM for our Pellet Plant and Mine Operations Departments."

Jan 1, 1982

By Wayne A. Greenwalt

A method that determines venture participation when the decision maker&apos;s level of risk aversion varies according to venture profitability and risk investment is presented. The decision maker&apos;s fundamental aversion to risk is established by the selection of a desired working interest for a venture that anticipates only a discounted payout.

Jan 1, 1982

By B C Tanda, E A. Oraby, J J. Eksteen

"Base metal and precious metal deposits are well known for their significant geometallurgical variation throughout the volume of the proven resource. At the metallurgical level, the plant normally processes an upper oxidised layer, a transition zone and a sulfide zone, often leading to different processing techniques for the different zones. A novel processing approach is presented whereby alkaline leaching with glycine is used to leach base and precious metals, using a copper-gold ore deposit as a case study. Glycine is a cheap, non-toxic, non-volatile, highly water-soluble crystalline solid produced industrially in bulk quantities. As a chelating ligand it forms a number of stable glycinate complexes with Ni, Co, Cu, platinum group metals (PGMs), Au, Ag, Zn, Pb, Hg and Cd, with broad stability regions over an extended temperature-pH-Eh range, allowing dissolution of these metals in the neutral and alkaline regions (pH 7–13). It has been shown that this lixiviant system can leach the metals from their oxide, oxy-halide, basic sulfate, carbonate, native and various sulfide forms, including refractory sulfides such as chalcopyrite. Extraction of the metals from their soluble glycinates is easily achieved using a range of solvent extraction and precipitation processes, and the glycine remains stable in aqueous solution for recycle and reuse. Minerals bearing metals in Groups 1 to 8 of the periodic table are normally unaltered. This technology therefore provides a highly selective leaching environment for the extraction of numerous scarce metals of economic interest, with minimal interaction with gangue minerals, whilst using environmentally benign reagents. Problematic leach residues such as jarosites, elemental sulfur and silica gels are averted through this processing approach. This technology allows hydrometallurgical processing that is much less domain-sensitive in the geometallurgical sense, and utilises essentially the same key reagents for the whole deposit.CITATION:Eksteen, J J, Oraby, E A and Tanda, B C, 2016. Developing Robust Hydrometallurgical Processes to Recover Metals from Deposits with Large Geometallurgical Variation, in Proceedings The Third AusIMM International Geometallurgy Conference (GeoMet) 2016, pp 15–20 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Jun 15, 2016

By S D. Dessureault

In large coal strip mines, there are many different processes at work: stripping, overburden removal using trucks/shovels, cast blasting, slot dozer pushing, more fragmentation and further truck/shovel benches. A key component to each of these steps is the use of machines. In modern operations, most machine costs are tracked within Enterprise systems that transact costs and repair work order management. Similarly, in contemporary mines most machines are tracked using technology that provides precise performance measures for each key process. Such technologies include productivity monitors on draglines, dozers and drills and fleet management systems for trucks and shovels. Linking these two sources of seemingly disparate data û costs and performance by machine û would allow for the precise calculation of unit costs by specific machine. This is similar to an&nbsp;activity-based costing system, except in this machine-based system, calculations are made at an even finer granular level. There are many uses for such an integrated information system in mine planning and performance management, both in real-time and through historical analysis.A real-time fleet costs (FLC) measurement process was developed as part of a larger blending-related, multi-million dollar project centred on a centralised remote control room developed at the University of ArizonaÆs Mining Information Systems and Operations Management Mine Control Center. The FLC component of the overall blending system would allow a mine controller to manage the equipment fleet by viewing its cost in real time and, when mixed with other revenue-related components, the exact profit. For example, a mine controller may show high utilisation while still maintaining a production surplus. This could occur, for example, if the equipment is driven long distances. This might appear in traditional performance metrics as æhigh production performanceÆ, but in reality may prove less profitable. This paper discusses the technical development of the FLC, its deployment and its impact on controller performance, and compares mine profitability before and after its application.

Sep 26, 2011

By V Lishchuk, C Lund

"Geometallurgy aims to improve resource efficiency by creating a spatial model of an orebody in order to forecast ore processing behaviour. This enables calculation of the economic value of each ore block and the use of this information for production optimisation and hence an improved economic return. Modelling uses different approaches to link geological information with mineral processing: traditional approach uses chemical elements; proxy approach – small-scale geometallurgical tests; and mineralogical approach – minerals.A geometallurgical model is obtained during execution of a geometallurgical program encompassing the entire value chain of ore processing. Available methods for establishing a geometallurgical model are in many cases limited and not yet comprehensively validated. Some of the limitations include: sampling density, assaying methods and quality, forecast accuracy block model content, geostatistical solutions for non-additive components, blending and assessment of positive impact of geometallurgy on the project. Synthetic ore models combined with process simulations and production scheduling, based on strong case studies, present a viable way to address these shortcomings. Such synthetic ore models will have realistic elemental and mineral distribution, textural attributes and 3D variability for input into the design of an appropriate geometallurgical program.A synthetic orebody was created for an apatite-bearing iron deposit. Variability in modal mineralogy was described by geostatistical parameters combined by a set of linear and trigonometric functions. The generated synthetic deposit model was used to develop a mine production plan to generate a simulated process feed. The process feed had detailed information required for beneficiation process simulation: modal mineralogy, chemical composition of minerals, grain size and specific gravity. The synthetic system was used to measure benefits that a geometallurgical program developed for real cases could provide, compared to production where only head grade is optimised. These include a reliable sampling strategy and confidence in the feed-quality forecast for economic evaluation.CITATION:Lishchuk, V, Lund, C and Lamberg, P, 2016. Development of a Synthetic Ore Deposit Model for Geometallurgy, in Proceedings The Third AusIMM International Geometallurgy Conference (GeoMet) 2016, pp 275–286 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Jun 15, 2016

By R. N. W. DiLabio

"In a continuing program of mapping glacial dispersal trains, near-surface till samples were collected down-ice from a copper-silver-gold prospect at Onaman River, Ontario, and down-ice from the past-producing gold district at Oldham, Nova Scotia. The program is designed to aid exploration by illustrating glacial dispersal from various types of known occurrences and by identifying postglacial processes that control drift composition at a detailed scale.Native gold was mined at Oldham from arsenopyrite-bearing saddle reef quartz veins in a dome in Early Paleozoic slates of the Meguma Group. Gold abundances greater than 10 ppb in till form a dispersal train at least 1900 m long. Gold abundances between 40 and 100 ppb occur in clusters up to 600 m down-ice from gold-bearing bedrock. Anomalous arsenic abundances in till form a broad train 1100 m long that is significantly different in shape from the gold train.At Onaman River, subeconomic amounts of Cu-Ag-Au occur in quartz lenses in Archean mafic volcanic rocks. A dispersal train defined by the distribution of mineralized boulders and increased abundances of Cu, Ag and Zn in till extends 600 m down-ice from mineralized bedrock. Gold abundances between 10 and 70 ppb do not define this dispersal train, but occur instead in clusters 300 to 600 m down-ice from mineralized bedrock. In vertical sections in the upper 2 m of copper-rich till, Au abundances vary sympathetically with Ag and Cu levels; however, there seems to be no preferential site of Au enrichment in the mineral portion of the soil profile.Several of the mineralized boulders at Onaman River are richer in Au and Ag than the mineralized bedrock from which they were derived. Although some of the high Au and Ag assays were caused by biased sampling of sulphide-rich portions of the boulders, many were caused by leaching of sulphide minerals from 'the boulders, which left a limonitic boxwork that is enriched in Au and Ag. A few of the Au-rich boulders may have been derived from an unknown bedrock source."

Jan 1, 1982

By Thomas R. Stauffer

The principle that conventional schemes for taxing petroleum or mineral resources are "inefficient" is illustrated using simulation calculations tested against an "ideal" system. Inefficiency is defined as the relative success in maximizing expected government revenues from the resources. Most systems fail because: 1) they leave oil in limbo, i.e. unproduced because of excessive fiscal burden; or 2) they unnecessarily increase the variance in the explorationist&apos;c, rate of return by undertaxing large fields and overtaxing smaller but infra-marginal fields. This increases his discount rate and reduces taxable surplus. An "ideal" tax system is specified which maximizes government revenues while minimizing risk to the operator. Two criteria are developed: 1) the tax falls to zero on fields which yield only the minimum necessary rate of return ("marginal" fields); and 2) the after-tax present value of all fields is the same for all fields above a threshhold size. In particular, marginal fields, while contrib- uting little to expected values, do contribute to reducing variance and hence risk praemia by distributing the exploration costs over a higher probability of successful outcomes.

Jan 1, 1982