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By Coopers &. Lybrand

INTRODUCTION From a tax viewpoint, United States mining companies are at a substantial disadvantage in the international mining area compared with companies in other major capital-exporting countries, according to a 1975 study by Coopers & Lybrand for the American Mining Congress. The study compared the relative tax position of a United States investor with investors from Belgium, Canada, France, Germany, Japan, the Netherlands, Switzerland, and the United Kingdom. The comparison was based on average rates of return realizable by investor companies on four mine-model investments in twelve capital-importing countries. The countries in which these investments were assumed to be made are varied in their tax systems so that a wide range of possibilities was included in the analyses. Each mine model was standard so that the rates of return for each investment by each investor were affected solely by the respective tax systems of the capital-exporting and capital-importing countries. UNITED STATES POSITION The study found that the United States competitive position, in terms of the average rate of return on an overall basis, ranked next to last among the nine capital-exporting countries in the study. Further, the United States overall rate of return is more than 20% below that of the country (Japan) with the highest overall rate of return. On an average return-on-equity basis, the United States' position among the nine investor countries, for each of the mine investments studied, was: copper, eighth; iron ore, sixth; nickel, fifth; manganese, a tie for last place. Figure 1 shows the overall results realized by each capital-exporting country on the basis of average return on equity. [ ] The frequency with which a given capital-exporting country attains the highest or next highest rate of return in a capital-importing country provides further insight and another basis for comparing the tax laws of the capital-exporting countries. Of the situations compared in the study, the United States never attained the highest rate of return, and reached the second and third highest rate of return in only two instances. The tables showing the frequencies of rankings are given in Table 1 for each of the four mine models. In summary, the United States mining company does not have a competitive advantage under the tax rules when competing for mineral concessions in other countries. The United States company, in fact, appears to be at a clear disadvantage. The study also considered the effect of the following recent tax proposals on United States investors in international mining ventures:

Jan 1, 1985

By G. E. Karantzavelos

A novel two-stage froth flotation process for the recovery of pure magnesite from low grade ores is described. The process consists of a first-stage, magnesite flotation step where a rougher magnesite concentrate is floated with amine collectors. The first-stage froth concentrate is then repulped in fresh water, and quartenary ammonium salt and fuel oil are added to float the remaining impurities. The results from laboratory batch tests show that a high-grade magnesite concentrate assaying 0.99-0.20% Si02 and 2.84-0.46%a Ca0 can be produced. Regulation of the variables controlling magnesite froth flotation also allows the variation of the ratio % Ca0: % SiO2, between the acceptable limits 0.32 to 5.79. This ratio is important to the quality of dead-burned magnesite.

Jan 1, 1985

By Jack A. Caldwell

Jan 1, 1985

By R. D. Brown

This paper profiles Canada’s current economic, tax, and political environment with respect to its mining industry. Problems that must be overcome if the industry is to attain its full growth potential and are highlighted, some suggestions reflecting the opinion of many in the industry are given. Tables provide some detail on the current Canadian mining tax system, province by province, as well as for the Yukon and Northwest Territories, plus some relevant economic trends.

Jan 1, 1985

By R. C. Kadyk, C. J. Bise

High-voltage cable couplers are convenient and widely used accessories in modern coal-mine power distribution systems to help extend and retract power-feeder cables throughout a mine. Coupler design has tried to keep pace with the industry's desire to move to higher distribution levels, but the increase in recorded failures of 15-kV class couplers, which serve the 12.47-kV and above distribution levels, has inhibited this transition. Problems associated with the effects of partial discharge on high-voltage cable couplers are analyzed. The phenomenon of partial discharge is discussed, a testing standard is developed, and various coupler designs are subjected to its requirements. An analysis of test results and results based on field applications are provided.

Jan 1, 1985

By S. K. Ruggieri, R. A. Jankowski

Airborne respirable dust levels on longwalls can be reduced if operators approach the dust control problem in a logical and fundamental manner. This can be accomplished through the proper application and continued use of effective dust control techniques. The Bureau of Mines is currently assessing the effectiveness of longwall dust control techniques in use today to provide mine operators with guidelines for selecting the most appropriate control technology. This paper presents a fundamental approach to the problem of shearer dust control. Three dust control techniques to be discussed are: deep cutting/increased pick penetration for reducing the amount of respirable dust generated; drum water sprays/improved water supply system to suppress the amount of airborne respirable dust; and improved external water spray system, the “shearer-clearer, "to push the dust close to the face. The techniques have been evaluated infield trials and have been shown to be both practical and effective in applications to control shearer generated dust.

Jan 1, 1985

By Grover R. Castle

INTRODUCTION Banks are being asked to assume more and more of the project risk in connection with project financings and, as a result, they are seeking to become more sophisticated in the way that they approach these kinds of financings. For example, a large number of banks that are active with the mining companies have established mining groups which typically will include mining engineers, economists, and bankers, in order to specialize their service to the mining industry. These banks have geared up these special service staffs so that they will be better equipped in their lending activities to analyze, measure and evaluate the project risk. The hope is that a team of these specialists will be able to predict the potential success or failure of these new "green fields" mining ventures that the banks are asked to finance. This paper shall focus on this subject and try to determine just how successful these specialists can hope to become as they analyze these various projects that are brought to them for financing. The approach that shall be taken in this paper shall be to examine how successful the mining companies themselves have been in the past with this same problem. These mining companies should be the most sophisticated in their approach to the analysis of the potential for success of a new mine because they have had the most experience in evaluating these projects. After all, who knows more about developing a mine than the companies that have developed similar mines in the past? For the purposes of this paper, the writer has selected a sample of 18 mines that have been developed over the years and measured the actual performance of each of these sample ventures against the original projections. All of these cases have involved the development of large projects where the sponsors or partners in the venture are substantial and sophisticated companies and where the feasibility studies have been prepared by engineering firms that are considered very professional in the industry or alternatively where the feasibility has been done by a comparable in-house staff. The sample cases have been chosen from a period which starts in 1965 and continues through 1981 with the cases distributed over that period as indicated below: [ ] Fourteen of the projects are open pit mines, three are underground mines and one mine starts on the surface and gradually goes underground. Seven of the mines are in the the far east with the remaining three in either South or Central America. The following four specific questions were examined for each project:

Jan 1, 1985

By Tomek Ulatowski

This presentation discusses the necessary ingredients for the creation of an acceptable credit structure, i.e., the structure that enables the borrower to attract the funding from different groups of lenders. As the amount of debt in the capitalization of new projects increases, it becomes quite critical that the mining venture sponsors obtain funding in a manner which maximizes the project economics. Attention normally is focused on the inherent operating cost characteristics of a venture such as the cost of mining, milling, transportation, smelting, and refining. The projected costs are derived from lengthy feasibility studies often taking millions of dollars and years to prepare. For a variety of reasons as the amount of equity directly provided by the sponsors declines, the balance must be made up from external credit sources. As a result, once the project becomes operational, debt service requirements assume crucial importance. For most new ventures, in the early years of production, the total amount of periodic debt amortization charges together with the projected interest expenses equals or exceeds the total operating cost. Utmost care must be taken, therefore, to reducing these costs which will then increase the chances for the implementation of the project. Project sponsors must carefully evaluate different funding sources in terms of their potential economic impact and, concurrently, evaluate alternative credit structures in order to be able to attract the selected funding vehicles. In this presentation I will discuss credit sources in the order of their relative appeal; i.e., from the standpoint of maximizing rates of return to the project owners. The tenor of the credit, that is the period from signing a loan agreement to the time of last repayment under the loan agreement, is undoubtedly the most important variable in evaluating the attractiveness of debt sources. Therefore, I will begin by discussing debt sources with the longest maturities and will end with a description of credits with relatively shorter tenors. The availability of different funding possibilities will naturally depend on the geographic location of the proposed venture, the creditworthiness of the borrower and the sponsors, the project economics, and finally the actual liquidity conditions in the capital markets at the time that the funds are committed. U.S. LONG-TERM DEBT MARKET - PUBLIC OFFERINGS AND PRIVATE PLACEMENTS The long-lived nature of most mining projects dictates that the majority of the mine financing be raised from long-term sources. In today's world capital markets U.S. debt issues probably carry the longest maturities available. The maturities can range from 5 to 40 years. Various types of long-term corporate debt instruments can be differentiated from one another by their terms, seniority as to claims against the assets of the issuer, legal form, and whether issued privately or through a public offering. The terms of these debt issues vary widely. For example, the interest rate which is typically fixed at the time of issuance, is determined by the credit quality of the issuer, the maturity, the average life, the seniority of the debt, the quality of control covenants or type of assets pledged as security, and other exogenous factors such as: economic policy, general level of interest rates and cur-rent level of financing activity. The entire principal amount of the debt may be due and payable at maturity (known as a "bullet" maturity) or, more typically, through periodic repayments in equal or staggered amounts. Almost all such debt issues allow for prepayment at the option of the issuer, but require varying amounts of repayment penalties. Disbursements are made over a relatively short period after signing of the debt documentation which may not coincide with the actual funding needs of the project. Financial covenants can be quite stringent, covering areas such as the issuer's financial leverage, working capital, payment of dividends and other distributions, merger and acquisition activities, and limitations on the disposition of property. Long-term debt issues may also be distinguished by the seniority of their claims against

Jan 1, 1985

By William A. Bassett

Two very intense sources of electromagnetic radiation are contributing significantly to experimental studies of minerals at high pressures and temperatures: 1) A Q-switched YAG laser is able to produce a pulse of infrared radiation capable of heating a sample under pressures up to 400 kbar in a diamond cell up to temperatures in excess of 4000°C. 2) X-rays from the Cornell High Energy Synchrotron Source (CHESS) are used to obtain diffraction patterns of samples In a diamond cell in less than two minutes, patterns that would require hundreds of hours on a conventional source. The laser heating technique is being used to study the pressure-temperature conditions over which the melting of diamond takes place. In the initial stages of this investigation, diamond has been melted and techniques for detecting the melting have been developed. The intense X-rays from the synchrotron source have been used to examine the mechanism and rate of the pressure-induced phase transformation in Fe2Si04.

Jan 1, 1985

By B. Yarar, J. Kaoma

[Introduction The critical surface tension of wetting of hydrophobic materials has been investigated extensively by Zisman et al. (1973) and relates the spreading of a liquid on a solid to the surface tension of this liquid. Thus, the Zisman ap¬proach shows that a plot of Cos 0 versus ?LV where, 0 is the contact angle and ?LV is the surface tension of that liquid in contact with its own vapor at equilibrium, produces a straight line which can be extrapolated to Cos 0 = 1. The intercept corresponds to a given ?LV, termed the critical surface tension of wetting. In instances, however, Cos 0 - ?LV plots show deviations from linearity. Alternative approaches have also included the plotting of adhesion tension (YLV COs 0) versus ?LV that can be interpreted in terms of critical surface tension data (Lucassen-Reynders, 1963). It has, on the other hand, been customary to correlate contact angle (0) with flotation data, although it is recognized that surface inhomogeneities and related contact angle hysteresis limit the interpretations pertaining to solid surface structures purely based on contact angle measurements. It is nonetheless true that 0 = 0, when the liquid is water, corresponds to a hydrophilic solid. Determination of ?c by contact angle measurements in conformity with the Zisman approach can encounter experimental difficulties, especially when solids are in a powder form. Following the reasoning that 0 = 0 corresponds to the hydrophilic state of a solid, froth flotation experiments can be expected to produce critical surface tension of wetting values for powders. The technique that consists of plotting recovery (% R) versus YLV data and extrapolating the linear part of the curve to % R = 0, has been described elsewhere (Yarar and Kaoma, 1984). This paper describes some of the results obtained by the extrapolation technique mentioned above, using various sulfide minerals. Experimental Materials Molybdenite (MoS2), sphalerite (ZnS), chalcopyrite (CuFeS2), chalcocite (Cu2S), and galena (PbS) were handsorted from massive samples and ground by mortar and pestle, and the -147 Fan fraction used in experiments; sulfur (S) was a C.P. Fisher Scientific Co. product. Method One gram powder samples were conditioned for three minutes in methanol-water solutions of predetermined surface tension values and the percents recovered by flotation using a Partridge-Smith Cell (Partridge and Smith, 1972), were plotted against each ?LV value. Results and Discussion The percent recovery versus ?LV for two naturally hydrophobic solids, i.e., natural molybdenite, MoS2 and sulfur are given in Fig. 1 where it is seen that ?c for sulfur is obtained as 31.5 mNm-1 whereas for MoS2, it is 26 mNm-1. Figure 1 also shows that the new flotation technique described, for estimating ?c is in good agreement with the Zisman method. Curves obtained by the same method for the minerals Cu2S, PbS, and ZnS are given in Fig. 2, where it is seen that for Cu2S, ZnS, and PbS, the extrapolation to % R = 0 produces ?c values of 36, 39, and 49 mNm-1, respectively. CuFeS2, on the other hand, gives a curve that does not permit such an extrapolation to obtain a ?c value with certainty. Nonetheless, treatment of the powder with 8.95 X 10-5 molar Na2S solution followed by washing with distilled water prior to flotation effects the curves as shown in the insert of Fig. 2. The type of curves given in Fig. 1 appear to be typical of hydrophobic solids as can also be observed in Fig. 3. The composition of solid and minute quantities of inclusions seem to play an important role as regards the surface properties of solids as reflected by the slope of the linear part of the % R - ?LV plot and thus the value of ?c obtained by this technique. For example, MoS2 of three different stoichiometric compositions produced the data given below. [MoS2MoS2.14Mo1.002S2 ?c mNm-126.029.031.0 dR/d?8.95.23.0]]

Jan 1, 1985

By T. Nakao

Fujiwara quarry had been operated by the glory-hole benchcut mining system, but as it became difficult to meet expanding demand with this system, a central-shaft mobile crushing plant (MCP) system was introduced in 1979. This MCP is equipped with a hydraulic walking system manufactured for the first time in Japan. Central-shaft mining is now the common mining method of Japanese limestone quarries. With this method, crushing facilities are usually installed at the bottom of the shaft. But at the Fujiwara quarry, MCP was adopted and installed on the quarry surface. Many MCPs are operated in foreign countries, but few examples exist in Japan. Normally, Japanese limestone deposits lie in high mountain, obviously making it inconvenient for MCPs to walk in and around the quarry. This difficulty, however, was overcome, and the MCP has operated satisfactorily and efficiently for two years since its installation. To overcome difficulties in the central-shaft MCP mining system, two mining methods are employed: the slice-down method and the block-cut method.

Jan 1, 1985

By Charles Cowie

Jan 1, 1985

By John K. Hammes

INTRODUCTION From the point of view of the consumer, the cost of mineral commodities might be viewed as the total price industry pays for mine output. Similarly, the mining company engaged in the ongoing business of finding, developing and operating new mines is concerned very much today with the distribution of all the revenue paid for mine output and not just with its direct or controllable cash costs. In other words, what will the labor force, the supplier of energy, explosives, and reagents, and the supplier of government services, management, capital, and the ore reserves receive for their contribution to production? A significant amount might be categorized as what economic theory classifies as economic rent. Mining companies are finding it increasingly difficult to negotiate concession or work contracts to develop ore reserves in lesser developed countries, just as they find themselves accused of taking excess profits in their own countries. The principal difficulty in reaching mutually satisfactory agreements in many cases is the difficulty in establishing an acceptable distribution of income, in particular the distribution of economic rent. (See Chapter 7). Further, it is logical that the decisions and policies of the interested parties be they government or industry should be and will be influenced by their competitive position relative to determining the distribution of economic rent. The raising of finance for a mining project today may be inhibited by too biased an extraction of economic rent by entities other than the risk takers, the mining companies. ECONOMIC RENT A British economist (Ricardo D. McGraw-Hill, 1955) first proposed the concept of economic rent (See Drechsler, H.D. earlier in this Chapter.) Ricardo pointed out that no rent would be paid until land became scarce. Ricardo also stressed the distinction that the price of farm produce was not higher because of the rent paid on farm land but that the rent or price of more fertile farm land was higher because the price of produce is higher. This led to the concept that economic rent is not a cost and that it is therefore not price determining, but is itself price determined. Economic rent may be viewed as a cost if cost is equated with the concept of payment or distribution of income to any factor used in production. However, if it is a criterion that a payment must be made to the supplier of the factor of production, then economic rent is not truly a cost because it is not necessarily distributed or "paid" to the supplier. Consider the commodity A which occurs in three grades: Al, A2, and A3. Any grade may be used as a substitute for another grade in all of the industrial uses of A. However, in industries X and Y the different grades have different productivities. Table 1 shows the relative productivities of each grade in industries X and Y, and in all other industries [~]. [ ]

Jan 1, 1985

By Richard D. Call

Predicting the performance of a waste embankment requires an estimate of the properties of the waste and foundation materials. The performance characteristics and the associated material properties are: [ ] Methods for obtaining estimates of the material properties include: laboratory and field testing, back analysis, and indirect estimates from other material properties. The most critical technical need is the development of indirect methods for use in feasibility studies and mine planning, prior to production when actual samples of waste material are not available. Material properties are not unique, single values; they are probability distributions. There are two components to these distributions: the uncertainties in testing and the inherent variability of the material. The objectives of a material properties evaluation should be to obtain an unbiased estimate of the property distributions rather than the average or the minimum value. Whether the current trend to a probability design analysis is followed or a simple sensitivity analysis is conducted, the unbiased probability distribution is preferable to single values.

Jan 1, 1985

By Edgar F. Cruft

INTRODUCTION It is sometimes said that "mines are made, and not found." I rather doubt that the exploration geologist would be overly sympathetic to that statement, and, of course, like most one-liners it is only partly true. Access to different financial markets are important at the mineral prospect stage. The modern mine financier has a much more complex, and interesting, job than the financiers of an earlier era, for example, the Canadian financiers of the 40's and 50's who had one simple set of options; i.e. float a company, promote it, and sell an equity stock issue, and then promote it some more. QUALITIES OF A FINANCIER Because technical people are seldom taught financing in their basic training, and because they are usually not involved in it until at quite a senior level in their careers, the whole field often acquires a certain mystique. The engineering professions have too often believed financing is the province of the accountant or financial executive and just as we in the technical world are often too quick to bristle if the latter try to tread on our domain, the opposite can just as easily be true. Unfortunately, this is another example of a compartmentalized individual, and that is one thing the successful financier cannot be. However, to be a successful financier one does not need extensive training or experience in accounting or finance. In fact it can sometimes be a disadvantage to get too buried in working only from the standpoint of discounted cash-flow analyses, ROI's, etc. It must be stressed, however, that one had better know how these analyses are made, and be knowledgeable in understanding a balance sheet, and have a good understanding of financial terminology. The difference between a simple project-type debt financing with a commercial bank and a more inventive and creative financial package comes from an intuition and an experience relating to risk-reward factors. The most important element is "common-sense", based on knowledge and experience. The goal is structure a financial package that fits the project, and in so doing it is important to recognize that it must fit within the limitations of the group supplying the money. I find insensitivity to recognize these constraints the most common mistake made in the field. Put yourself in the other person's place and understand his sources of funds and financing limitations. The engineer has an advantage in financing, as he or she has (or should have) a better idea than anyone of the value of the product, be it the mine, prospect, or company i.e. the intangible or potential worth which cannot be put on a pro-forma. He also knows, or should know, the risks involved. Two projects might look the same on paper, but a good financier must have a sense of when to take whatever deal he can get, and when to hold out based on his evaluation of future developments. It is essential to have a good sense of commodity values and trends, trends affecting the general economy (money supply, interest rates, effects of energy costs, etc.), and political considerations. He must also have a good understanding of the science and art of taxation as deals can often be financed using the government as a silent and unwitting partner by proper use of the tax laws. WHEN TO SEEK FINANCE The first critical decision to make in financing a mineral prospect is "when". At the exploration level, when it is only a dream in the geologist's eye, the alternatives are more limited than when it is a fully-engineered project. The "when" decision depends on how much in internal funds the company has to play with, and how desirable it is to invite financial participation to spread the risk. Assuming that decision is not taken out of lack of money, no one can categorically say when to do it. There is

Jan 1, 1985

By Michael A. Gustafson, Fernando B. Sotelino

INTRODUCTION The degree of success of any new project will ultimately depend on two factors: (i) the underlying economic strength of the project; and (ii) how successfully the parties involved can coordinate their interests to establish a financing structure which indeed capitalizes on the project's inherent economic attractiveness. A project's underlying economic attractiveness is determined by its inherent comparative advantage in accessing the factors of production, combining these factors of production to create a product and marketing this product. Initially, the decision regarding whether to go ahead with the project - the go/no go decision - has to be based on its total ability to generate cash flow returns to project participants to compensate them for resources committed and risks undertaken. The extent to which project sponsors will actually benefit from the project's inherent economic attractiveness is fundamentally dependent on their ability to establish the long-term financing arrangement which best meets the objectives and constraints of each project participant and sources the most advantageous funding. The decision regarding the financing of the project, the "how-to-go" decision, is then an attempt to find the capital structure, consistent with market terms and conditions and sound financial management policies which will best: (i) match planned outflows with cash inflows; and (ii) maximize the return for project sponsors. This article makes use of a case study to illustrate the analytical process involved in dealing with the go/no go and the how-to-go decisions on a project. Though most commonly applied to project finance situations, the guideline described herein is equally applicable to other financing situations, such as leveraged buyouts and debt restructurings, where timely repayment of debt depends largely on the future cash flows to be generated by the entity being financed. Our case study is of a hypothetical expansion of an existing copper mining operation in Latin America. The company, Latin American Copper (LAC) currently has 147 million metric tons of proven sulphide ore reserves. The existing mine complex consists of an open pit mining operation and a conventional flotation plant with a processing capacity of 20,000 metric tons of ore per day. LAC sells copper concentrates primarily to Japanese custom smelters. The mine has been in operation for 5 years, fine copper production last year was 108,240 metric tons, and LAC currently has assets of $175 million and net worth of $135 million. Due to a recent increase in proven reserves, LAC is considering doubling the treatment capacity of its flotation plant to 40,000 tons per day, and expanding its mining capacity to meet the additional concentrator capacity (the "Project"). Project capital expenditures and incremental working capital have been estimated at approximately $210 million. The construction period is expected to cover one year, including a three-month start-up phase. The Project is to be funded by a combination of equity, senior debt, including both supplier credits and/or commercial bank term loans, and subordinated debt. LAC's shareholders are willing to commit a maximum of $50 million to the Project. A government development agency, which is also a minority shareholder, might be willing to lend approximately $40 million to LAC in the form of subordinated notes, depending on the ability of the Project to generate foreign exchange reserves. Commercial banks cannot be expected to offer loans with maturities longer than ten years. The Project is expected to increase the value of the firm because: (i) It will solidify the Company's position as a low-cost copper producer by taking advantage of economies of scale. As a result of the expansion, cash production costs are expected to decrease 7.0[c]/lb. and all-in costs 11.0[c]/lb; (ii) The potential earnings stream from the sulphide ore reserves will be realized

Jan 1, 1985

By Simon D. Handelsman, Reg M. M. Rowe

The mechanism of using gold as the basis for a loan was suggested to the treasurer of a mining company operating two gold heap leach mines at a time of high interest rates. Due to the seasonal nature of cash flows from operations, and the relatively low cost of funds this scheme was attractive. The paper describes the agreement with the bank, gives an example of the transactions, and describes other types of gold loans.

Jan 1, 1985

By M. E. Learmont, R. J. Lipp, I. Iwasaki

In the selective flocculation of iron ores, the concentration of alkaline earth ions in pulp solutions plays a critical role. Sodium silicate, alone or with sodium tripolyphosphate, has been used as a dispersant. When Ca+ + concentration exceeds 15 to 20 ppm, however, only a strong complexing agent, such as ethylenediaminetetraacetate (EDTA) was found to be effective (Heerema, Lipp, and Iwasaki, 1979). Some iron ores release Ca+ + in excess of 20 ppm. With ores that contain gypsum, the Ca+ + concentration may reach several hundred ppm. The purpose of this investigation was to compare the effectiveness of EDTA with nitrilotriacetate (NTA) in countering the adverse effects of Ca+ +, particularly at high Ca+ + concentrations. Emphasis was placed on the use of NTA since it is more cost-effective than EDTA. It is also used in detergents in some countries (Malaiyandi, Williams, and O'Grady, 1979). NTA, like EDTA, forms a soluble complex with Ca+ + with a 1:1 molar ratio. Its structure and the value of log Kca are given below together with EDTA (Shibata, 1963). [ ] For experimental materials, an equal weight mixture of Lac Jeannine hematite and a high-purity quartzite from Thompson, MN, both ground to - 30 µm (- 560 mesh) was used. Selective flocculation test conditions and procedures were identical to those used in previous investigations (Heerema, Lipp, and Iwasaki, 1979). The optimum level of starch addition for the above mixture was determined to be at 300 g/t (0.6 lb per st). Initially, a series of selective flocculation tests were performed on the mixture pulped with 10-3M CaC12 (40 ppm Ca + +) at pH 11. With no NTA present, flocculation of the entire suspension resulted. The selectivities achieved in tests with 90, 100, and 150% of the stoichiometric amount of NTA were virtually identical to each other and also to the selectivity of separation obtained in the absence of Ca+ + Such an observation could have been expected since Ca+ + concentrations up to a few ppm may be tolerated in selective flocculation (Krishnan and Iwasaki, 1982). A similar series of tests were performed at 10-2M CaC12 (400 ppm Ca+ +). The results are shown in Fig. 1 as grade¬recovery curves. For comparison, the results obtained in the absence of Ca++ are included. At 90% of the stoichiometric amount of NTA, a large enough concentration of uncomplexed Ca+ + was left in solution to cause indiscriminate flocculation. Note in this figure that NTA is capable of countering the adverse effect of Ca+ + even at this high concentration when it is used in excess of stoichiometric amounts. The free Ca+ + concentrations at 100 and 150% are calculated to be 2.5 and 0 ppm, respectively. [ ] The relative effectiveness of NTA and EDTA was then compared at 100% of the stoichiometric amount using 10-2M and 10-3M CaCI2 (Fig. 2). EDTA appears to be slightly more effective than NTA. The free Ca++ of 0.02 ppm in 10-2M CaC12 with EDTA compared to 2.5 ppm free Ca+ + with NTA might account for the difference. As evident, prohibitively high additions of EDTA and NTA were required to complex high concentrations of calcium ion. The use of both of these agents would result in the accumulation of complexed Ca+ + in recycle water.

Jan 1, 1985

By John K. Hammes

INTRODUCTION This introductory paper presents a description and definition of what the finance function is and what it specifically means for the mining industry. In its simplest terms, finance is, "management of money matters". As an area within the discipline of business administration it draws heavily on the related fields of economics and accounting, and to a lesser extent on marketing and production. MINING FINANCE DEFINED In preparing to write about what finance means to the mining industry, I asked a number of mining people the question, "What does mining finance mean to you?" Most responded that mining finance was "How a company borrowed money for mine development", and perhaps half those questioned included "raising equity" in the definition. It is not surprising that the mining industry concept of finance is the providing of funds needed for the objectives of the business, for that was once a view shared by authorities in the field of business administration. Further, it is certainly the area where much of the emphasis has been placed in the past ten to fifteen years as the industry struggled with the development of more remote and more refractory or lower-grade orebodies while profitability and internal cash flow were below expectations. No wonder project finance became such a popular topic. Twenty years ago it is probable that the emphasis would have been on mine valuation, for that subject was the area of finance then most often examined in industry publications. Papers concerning the pros and cons of payback, internal rate of return, and discounted cash flow appeared regularly. Let's examine the following situations, each the result of a financial decision: - Funding the exploration program in a developing country was accomplished by buying the next six-months budget needs in local currency. One week later the currency devalued 30 percent. If the purchase had been delayed or the local currency borrowed short term, a substantial saving would have been made in funding the program. - A major mining company borrows heavily to finance both expansion of its primary mining business and its entry into several new industry segments. When markets for all of the commodities it produces turn down for a prolonged period, there is concern over the adequacy of cashflow to cover debt service in addition to other company needs. The company's financial officers, however, had arranged very large committed credit facilities from numerous financial institutions which assured the availability of funds for several years. This enabled the company to implement a strategy to conserve cash, sell assets and survive until conditions improved. Further, short term suppliers of credit also were comfortable with the assurance that longer term credit was there to support them. -A medium size mining company financed several mines independently with limited obligations on the part of the parent company. The company decided to refinance the operations under one agreement. More flexible terms, lower interest cost and a longer tenor financing were achieved in return for assuming the risk as a direct obligor. - The exploration and development group of a large mining company proposes to develop a new mine in a country in which the company does not presently operate. When the investment is rejected they are advised that one reason was that the reinvestment assumption inherent in the discounted

Jan 1, 1985

By M. A. Bryant, J. C. Goodwin, T. B. Faddies, L. D. Kornze

The Mercur Gold Mine is located 56 km (35 air miles) southwest of Salt Lake City in north central Utah; In July 1981 Getty Mining Company made the decision to put Mercur into production. The first gold bar was poured in April 1983. This paper provides details on: 1) the history of the camp, 2) past production, 3) geology of the deposit, 4) the exploration and development program, 5) ore reserve estimates, 6) detailed geologic pit mapping, 7) production blasthole sampling techniques and 8) the use of geostatistics (kriging) in handling assays and gold extractions to produce the required mill feed.

Jan 1, 1985