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By John J. McCabe

INTRODUCTION Over the years, Congress has written into the Internal Revenue Code various provisions aimed at lessening at least one financial burden faced by taxpayers in the mining industry - the federal income tax burden. These provisions include the election to deduct exploration expenses, the election to defer deduction of development expenses, and the percentage depletion deduction. Careful tax planning from the very beginning of a mining venture is essential in taking maximum advantage of these tax benefits. A major decision to be made is the choice of organizational structure. (For a more detailed discussion of this subject, see McCabe, John J., "Developing Structures for Investments in Mineral Property," New York University Institute on Federal Taxation, 42 NYU 24, 1984). One such structure is the use of multiple corporations, with mining activities conducted by one corporation and nonmining activities, such as manufacturing, financing and administration, conducted by the other corporation. This technique, which will be discussed in detail below, can be particularly advantageous in delaying recapture of previously deducted exploration expenses and in maximizing depletion deductions. TAX BENEFITS IN MINING Exploration Subject to certain restrictions discussed below, exploration expenditures (i.e., expenditures paid or incurred during the taxable year for the purpose of ascertaining the existence, location, extent, or quality of any deposit of ore or other mineral, and paid or incurred before the beginning of the development state of the mine are deductible at the election of the taxpayer (Section 617(a)).* Were it not for this option, exploration expenditures would be required to be capitalized and recovered through depletion, after production begins. Exploration of a mineral deposit can be very costly and may not result in commercial production for some time. If the taxpayer has income to he offset by the deductions, a mining venture can usually be structured in such a way as to allow the offset of mining losses against the other income. With today's high interest rates, this election can be quite valuable in present value terms. Corporate and noncorporate taxpayers are subject to different restrictions on this tax benefit. Corporations may elect to deduct only 85 percent of eligible exploration expenditures (Section 291(b)). (The Tax Reform Act of 1984 reduced this to 80 percent effective for expenditures after December 31, 1984, in taxable years ending after such date). The remaining 15 percent (20 percent after December 31, 1984) is capitalized and recovered at the same rate as five-year ACRS property (Section 291(b)). Individual taxpayers are not subject to this 85 percent rule; however, any amount deducted in excess of ten-year straightline amortization is a tax preference item for individuals (Section 57(a)(5)). Individuals may avoid the tax preference by electing to capitalize exploration expenditures and amortize them over ten years (Section 58(i)). In order to prevent the taxpayer from, in effect, converting ordinary income into capital gain by selling property that has given rise to exploration expense deductions, the Code requires recapture of such deductions upon the occurrence of certain events (Section 617): 1. Upon disposition of the property, adjusted exploration expenditures are recaptured to the extent of gain realized on the disposition (Section 617(d)). 2. If the property is leased, the lessor is disallowed any depletion deduction until his adjusted exploration expenditures have been recaptured in the form of foregone depletion deductions (Section 617(c)).

Jan 1, 1985

By C. R. Hocott

THE viscosity of the oil in the reservoir is one of the properties that influence its movement through the sand to producing wells. Measurements of viscosity, therefore, are pertinent to problems associated with well behavior and with the estimation of recoveries, and afford an indirect means for partial evaluation of various methods of controlling reservoir behavior. The effect of dissolved gases on the viscosity of crude oil has been determined,1,2 but no data have been published on the viscosity of repre-sentative samples of reservoir oils. This paper describes a simple instrument that has been used to determine the viscosities of a number of subsurface oil samples at the temperatures and pressures existing in the reservoirs, and presents the results of the determinations for typical fields.

Jan 1, 1940

By K. Stout, E. Van Eeckhout, L. Friel

Previous research at the Montana College of Mineral Science and Technology indicated that it is practical and economically feasible to place stiff back- fill in a cut-and-fill stope. This backfill would reduce wall closure and high stress buildup in pi1llars, thus alleviating rockburst potential. Three ;topes from the Sunshine Mine, of the Coeur d’Alene Mining District, were chosen for a test verification of this concept. Although the first stope was lever mined beyond the initial cut (for economic reasons), some vibrating wire stressmeter results were obtained and found to compare favorably with numerical predictions. Some other instrumentation devices were built and tested, but never installed .

Jan 1, 1984

By H. W. Paxton, C. C. Busby

IT has been shown previously' that strain aging can markedly improve the tensile properties of low carbon martensites, especially the yield-tensile ratio, without seriously affecting the ductility. In view of interest in high strength steels, an investigation has been made of the effect of strain aging following tension or rolling on the tensile properties of A1S1 4340 in an attempt to obtain a tensile

Jan 1, 1957

By J. B. Goddard

Crystallization of ammonium paratungstate (APT) is frequently the last effective purification step in producing high-purity tungsten. However, crystallizer mother liquors are often several times higher in tungsten than predicted by the solubility of APT. The formation of heteropoly anions, particularly those containing phosphorus and silicon, is largely responsible. Solubility of tungsten in APT mother liquor can be linearly correlated with the concentration of these and other impurities. The problem can be overcome by direct treatment of the crystallizer feed solution with aluminum sulfate. By appropriate treatment, the aluminum hydroxide flocculates and is easily filtered, resulting in a purified low-aluminum crystallizer feed from which high APT yields can be attained.

Jan 1, 1985

By Louis D. Huntoon

CANADIAN gold production is forging ahead annually and the prospects are that it will continue to do so for many years. Table 1 shows recent annual increases. Production for 1933 will probably reach $70,000,000, and further increases are likely in 1934 and 1935. (Data for November and December, 1932, are estimated throughout this article.) The depression sent many prospectors to the woods so during the last two years many new gold areas have been discovered and are attracting real capital for exploration and development. Several mills came into production in 1932 and mills now under construction will start production in 1933. The offices of mining lawyers are busy. Capital for this new work is obtained from well financed mining companies, syndicates, and individuals who were fortunate enough to invest in the dividend-paying gold mines of the north country in the early days. Prospectors and capital are cooperating. An interest is always retained by the prospector or vender and usually a small amount of real money is given the prospector.

Jan 1, 1933

By J. A. Herbst, R. Mackelprang, J. D. Miller

Droplet size distributions were determined by stabilizing in gelatin and measurement of the distributions by means of computerized image analysis Several variables that affect droplet sizes were studied and the resulting size distributions were modeled via a population balance equation Key parameters in the model were related to the physical properties and operating conditions of the systems examined using a multiple linear approach

Jan 1, 1981

By D. H. Davis, I. Fatt

Oil bearing rocks, usually found at depths of 2,000 to 10,000 it, are elastically deformed by overburden pressure. Although the change in porosity with pressure in a number of example rock.: has been shown to be small, it was thought that overburden pressure might have a significant effect on permeability. This note presents results of an investigation to determine the magnitude of the change in permeabilty with pressure. In routine core analysis permeabilities are measured on rock samples which are not under overburden pressure. If permeablity measured in this way differs from permeabilities measured under overburden pressure, a systematic error is introduced into well productivity calculations. The experiments described in this report were made to determine the magnitude of the change and thus to give an estimate of the error introduced into the calculations. The error introduced by the neglect of the change in permeability when overburden pressure is removed may account for part of the difference between well productivity calculated from core analysis and the actual well productivity. The results obtained in this investigation have only quali-tative significance because of the difficulty in reproducing in the laboratory the stress conditions on the rock buried in the earth. The assumption which is usually made is that the rocks in the earth are under a uniform pressure equal to the weight per unit area of the vertical overburden column from the rock in question to the surface of the earth less the pressure of the liquid in the pores of the rock. For an overburden consisting of sandstones and shales (of assumed average specific gravity of 2.3) and for a liquid pressure equal to the pressure in a salt water column (of specific gravity 1.0) reaching from the rock to the surface, the resulting net pressure on the rock is approximately 0.56 psi per ft of depth. EXPERIMENTAL METHOD Clean, dry sandstone core plugs one in. in diameter and about three in. long were mounted in a copper foil jacket as shown in Fig. 3 or molded in a Lucite jacket as shown in Fig. 4. All cores except those labeled "2" in Fig. 1 and "8" in Fig. 2 were measured in the copper foil jacket. Cores "2" and "8" were measured in the Lucite jacket. The jacketed core was placed in a high pressure hydraulic bomb in which the liquid pressure outside the jacket could be raised to 15,000 psi. Flow lines from the core were brought out of the bomb through special fittings in the bomh head and connected to a laboratory type gas permeameter. Measurements were made with nitrogen gas; the maximum mean gas pressure in the core was 16.1 psia. RESULTS The specific permeability of sandstone decreases with in. crease in overburden pressure. Most of the decrease takes place over the range of zero to 3,000 psi overburden pressure. If the net pressure on the rock is assumed to be 0.56 psi per ft of depth as discussed above, 3,000 psi of overburden pressure is equivalent to about 5,000 ft of overburden. At 3,000 psi overburden pressure, the permeability of the eight sandstone core samples tested ranged from 59 to 89 per cent of the permeability without overburden pressure. Figs. 1 and 2 show the permeability reduction as a function of overburden pressure. The permeability of the eight cores without overburden pressure ranged from 4.35 md to 632 md; these permeabilities are listed in Figs. 1 and 2. REFERENCES 1. Carpenter and Spencer: "Measurements of Compressibility of Consolidated Oil Bearing Sands," U. S. Bureau of Mines, R.I. 3450, (1940). * * *

Jan 1, 1952

THE CHAIRMAN (H. W. MORSE, Los Angeles, Cal.).-I would like to open this meeting for a little while to the general subject of leaching. We ought not to hold back if we have any new schemes for the future. I know that those of us who are tangled up with this lei thing work will appreciate any suggestions that will make us work harder and, scheme, harder to pull through these past difficulties on leaching. F. S. SCHIMERKA, Clifton, Ariz.-Under the direction of J. W. Bennie, General Manager of the Shannon Copper Co., Clifton, Ariz., 'it has been my valued privilege to cooperate in the elaboration of a hydrometallurgical process aiming at the recovery of copper in mill tailing resulting from a gravity concentration of a low-grade semi-oxidized sulphide ore occurring in a porphyritic gangue. The experimental work which has been carried on with a 25-ton plant is completed, and the company is building at present a leaching plant on a larger scale, the first unit consisting of a 150-ton roasting furnace and accessories for leaching the calcine.

Jan 12, 1916

There were present twelve- Directors, the Secretary and the Assistant Secretary of the Institute, and fifteen guests. A committee of three was appointed to draft a suitable resolution of memorial of the services of Joseph Esrey Johnson, Jr. The committee consists of Joseph W. Richards, Chairman, J. V. N. Dorr and Allen H. Rogers. William R. Walker was elected a Director in place of J. E. Johnson, Jr., and Edwin Ludlow was elected a member of the Executive Committee in his stead. George C. Stone was appointed Chairman of the Committee on Membership in place of Mr. Johnson. The following resolutions were then adopted: RESOLVED, That a special business meeting of the Institute be and the same hereby is appointed to be, held at the office of the Institute, No. 29 West 39th Street, Borough of Manhattan, City of New York, on the 27th day of June, 1919, it 8.30 o'clock in the P. M. to consider and take action upon the proposal to change the name of the Institute to "American Institute of Mining and Metallurgical Engineers, Incor-porated," and the further proposal to extend the corporate purposes of the Institute so that it shall, in addition to its other powers, be empowered to promote the arts and sciences connected with the economic production of the useful minerals and metals, and the welfare of, those employed in these industries, by all lawful means.

Jan 6, 1919

The age of specialization has made man increasingly dependent on a larger number of different metals and minerals. Overexploitation during World War II and lavish squandering of irreplaceable mineral wealth in the past has resulted in the rapidly approaching exhaustion of some of the major domestic ore sources. History clearly points out that the United States cannot continue to be a world power on an "import to survive" policy. A constructive program of development and appraisal of the nation's mineral wealth, including the planned conservation of her resources, must be adopted. Strictly speaking, conservation of minerals must mean the orderly exploitation of our resources and the prevention of waste in use, with due regard for the future. Real concern for the future may not extend beyond a few generations. Eventually science and invention should take care of the problems arising from shortages of some minerals, and the national defense aspects of domestic deficiencies can be provided for by stock piling and other measures. Early conservationists had this viewpoint; but with a rapidly developing industry and population, a farsighted policy that would deny full realization of immediate ambitions became unpopular. Consequently, the politically minded conservationist broadened the concept to include "prudent use of resources" and brought under the conservation umbrella

Jan 1, 1950

By S. K. Nicol, A. R. Swanson, J. C. Day

Addition of oil to a suspension of hydrophobic coal particles can influence its dewatering characteristics. An agglomeration process occurs in which coal particles are held together by negative capillary pressure at particle/oil/water contacts. Consequently, the units round which flow can occur are enlarged and this improves dewatering parameters such as drainage rate, solids recovery, and equilibrium moisture content. This paper discusses processes which attempt to use this principle, in terms of metallurgical and economic efficiency. The discussion is augmented by results of recent experiments on the effect of oil addition to centrifuges and vacuum filters.

Jan 1, 1980

By J. Walter Snavely

PRESENT-DAY processing in many industries, calcining, sintering, briquetting, beneficiation and nodulizing, increasingly calls for the handling of large volumes of hot bulk materials. Various types of conveyors have been employed. This discussion will cover the factors governing their selection. For temperature ranges up to 400°F, or approximately 200°C, a wide range of conveyors is available. Special constructions of rubber conveyor belts. steel conveyor belts, vibrating and shaker conveyors, apron conveyors, and drag chain conveyors, all are used successfully. As temperatures go well above 400°F, however, choice of conveyors is narrowly limited. This paper will consider the problem of handling bulk materials only where the temperatures exceed 400°F.

Jan 5, 1953

By W. B. HILLHOUSE

AN excerpt from the Alabama State Mining Law, pertaining to, transporting men' into and out of the mines, reads as follows: "A trip of empty cars may be operated for the purpose of taking employees into and out of the mine, where the distance to and from their work exceeds one mile." The State Mining Department of Alabama includes in its inspection the transportation of men into and out of the mines, also studying and noting improvements, or progress made, that would tend to create a greater assurance of safety in this practice. Everyone is familiar with the original safety methods employed in man-trip transportation, such as passing a rope around the trip of cars, or through the cars, fastened in the conventional manner, and with the usual "clog," commonly called a drag, on the rear end. Also there is a more advanced method of transporting men, such as the double-rope system, which is feasible on slopes used exclusively for this purpose, and is very satisfactory. However, for the past eighteen months; the Republic Steel Corp. and the Tennessee Coal, Iron & Railroad Co. have adopted a practice that shows

Jan 1, 1935

By Harlan A. Walker

Rock-drill steel has an important bearing on costs in many mining operations, both directly and indirectly. Direct factors include such items as shop expense, steel consumed per ton of ore produced, cost of distribution and the dust hazard. The latter, although no specific amount may be assigned to it, is an ever-present problem, and is receiving increased attention as the science of mining progresses. Indirectly drill-steel performance affects consumption of compressed air, maintenance of drills and drilling speed. The latter, in turn, increases or retards the tempo of mining and development. These factors, while not all inclusive, are preponderant in their importance. Thus it is evident that in an extensive operation drill-steel expense may run to many thousands of dollars and that thoughtful research leading toward more efficient practice is warranted. Experimental Work During the late spring of 1939, experiments were undertaken at Homestake in reducing changes in drill-steel gauge from ? in. to 1/16 in. In drifts and crosscut headings mounted machines were set up and holes were drilled with ?-in. bit-gauge changes and other holes a few inches

Jan 1, 1940

By Edward D. Thimons, Richard J. Kline

Converting the energy of falling water into useful work is a well developed engineering concept. Much of the electric power consumed in the United States is generated in this manner. It is easy to conceive that the water which flows down long vertical pipelines into deep nines could be utilized in a similar manner by allowing it to operate a turbine at the bottom of the pipelines. The mines in the United States are continually descending to greater depths in search of mineable deposits. Large quantities of water are carried down long vertical pipelines in order to be used for dust suppression, motor cooling, and refrigeration. Pumping the used water back to the surface is also required. The electrical costs associated with mining are also constantly escalating due to both increased demand and rising kilowatt hour costs. To help deal with this problem, the United States Bureau of Mines (USBM) has awarded a contract to Foster-Miller, Inc. of Waltham, MA, to investigate, evaluate, and demonstrate commercially available means of energy recovery for the deep mining industry. In other words, it demonstrates an efficient system for converting the energy of water flowing down vertical pipelines into useful mechanical or electrical energy.

Jan 1, 1982

By K. A. Natarajan, I. Iwasaki

With a platinum electrode the Eh-pH response in aqueous systems follows an empirical relation [Eh = E- 0.059 pH](1) where E usually carries a value between 0.8 and 0.9 v. The same potential (E) is observed with a number of other noble metal electrodes in the absence of surface poisoning and of other well-defined redox couples. Many sulfide mineral electrodes also respond in a similar manner in solutions containing their respective ions over wide pH ranges, especially in the alkaline pH region. Such a parallelism between noble metal and sulfide mineral electrodes points to certain implications of their surface conditions, and the flotation and leaching behaviors of sulfide minerals under aerated conditions may be inferred with respect to the foregoing Eh-pH response. Comparison of Sulfide Mineral and Noble Metal Electrodes [Fig. 1] shows the Eh-pH response of pyrite, galena, chalcocite, and pyrrhotite electrodes, reported by Sato, and some experimental points obtained with a platinum electrode in distilled water. [Eq. 1] is seen to be followed by all these electrodes. It is interesting to note that the response of the pyrite electrode as shown is identical to

Jan 1, 1973

By T. R. Cass

THE renewed interest in titanium, resulting from its increasing application as a structural material, has stimulated basic deformation studies on this metal. In the course of our work, we have developed a dislocation etchant and applied it to a perfection study of melt-grown single crystals as well as to a preliminary investigation of plastic deformation in titanium. The etchant, Keller's etch (21 cu cm HF, 64 cu cm HC1, 106 cu cm HNO3, and 160 cu cm H20), reveals the emergence of both grown-in and fresh dislocations on pure titanium and a-phase Ti-Al single crystals. Pits are produced only on surfaces within a few degrees of the basal plane; the more exactly parallel to a basal plane the surface is, the more distinct are the pits. The observed pit density, however, does not appear to depend on the surface orientation; the pits simul- taneously become less distinct as the misorientation from a basal plane increases. Etch times are short, a few seconds, for pure titanium; longer times are necessary for alloy crystals.

Jan 1, 1968

J. T. LITTLETON, JR., ? Corning, N. Y. (written discussion?).-This. discussion will add little that has not been brought out but will show how the problems encountered in the Corning Glass Works were overcome. The chief points of consideration in any equipment are, first, the work the equipment is called upon to do; second, the installation; and, third, the man who will use it. These three points should determine the type of apparatus adopted. If only rough measurements, merely a little better than the eye, are desired, the cost of the instruments should be considered; but if accurate temperature control is necessary, the cost of the equipment deserves only small consideration. There is no question that the real problem for any factory is the installation, making sure that the elements really give the temperatures desired; also, the instruments must be so designed that any man can use them.

Jan 12, 1919

By Harlan A. Walker

Rock-drill steel has an important bearing on costs in many mining operations, both directly and indirectly. Direct factors include such items as shop expense, steel consumed per ton of ore produced, cost of distribution and the dust hazard. The latter, although no specific amount may be assigned to it, is an ever-present problem, and is receiving increased attention as the science of mining progresses. Indirectly drill-steel performance affects consumption of compressed air, maintenance of drills and drilling speed. The latter, in turn, increases or retards the tempo of mining and development. These factors, while not all inclusive, are preponderant in their importance. Thus it is evident that in an extensive operation drill-steel expense may run to many thousands of dollars and that thoughtful research leading toward more efficient practice is warranted. Experimental Work During the late spring of 1939, experiments were undertaken at Homestake in reducing changes in drill-steel gauge from ? in. to 1/16 in. In drifts and crosscut headings mounted machines were set up and holes were drilled with ?-in. bit-gauge changes and other holes a few inches

Jan 1, 1940