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By D. Lelinski

Air-sparged hydrocyclone (ASH) flotation is one of the new promising technologies. Numerous applications have been successfully tested since its conception; nevertheless, research and development efforts have continued to provide for further improvements with respect to operating conditions and design considerations. Results from experimental studies on bubbles generation in the ASH system are presented in this paper. Bubble size distributions generated during ASH operation have been determined using a high-speed photographic technique. The influence of many factors including surfactant concentration, water flowrate, and porous tube pore size has been studied. Test results indicate that these process variables have a profound effect on the bubble size distribution. With an increase in surfactant concentration or water flowrate (shear field) the bubble size distributions become narrower and shift toward smaller average bubble diameters. However, the influence of pore size is more complicated. Depending on the experimental conditions the average bubble size was found to range from about 100 to 300 microns in diameter.

Jan 1, 1995

By Yu. A. Polozov, V. A. Lagunov, O. Yu. Lushinkova, Yu. I. Svirskiy, Eh. Ya. Kipko, Roy A. Williams

The effectiveness of the grouting of saturated, fractured rock in the vicinity of underground workings depends to a great extent on the correct interpretation of the specific hydrogeological conditions at the site. During the planning of grouting operations, calculations of the hydrogeologic co-efficients and of the parameters of the isolating grout curtain(s) and the procedures for forming the curtain(s) must be based on valid hydrogeologic characteristics of the fracture system of the rock within each hydrostratigraphic unit (Anon., 1976). This chapter presents a discussion of the background information that must be collected for these purposes. Details of testing are presented in Chapter 3. The general design of new or the reconstruction of existing underground workings requires a broadly based organization having the expertise to develop a grouting operations plan once it acquires the necessary information. The needed information includes: 1) general information about the hydrogeologic section, 2) the engineering design of the underground workings, 3) the geology of the region, 4) the hydrochemistry of the ground water, 5) the hydraulic properties of the rock, 6) the characterization of all gases present, and 7) characterization of the rock's physical-mechanical properties which is necessary to avoid or control hydrofracturing . The geological documentation portion of the hydrogeological investigation is prepared based on the results of geologic mapping, geophysical surveys and on geo-exploratory operations at a regional and local scale. Geological data from the excavation of other underground workings in adjacent areas of the region is also included. Finally the results of site specific investigations in boreholes constructed at the site of the proposed underground activity are incorporated. A section of the preliminary report entitled "General Information about the Project Site" patterned after the parent STG guidance document on this subject must be com- piled based on the contents of geological reports and on the general construction plan for a new project or the plan for reconstruction of an existing operation. This section of the preliminary report must contain concise information about the conditions under which the planned grouting operations are to be conducted. The information must cover the geo- graphic, administrative, and economic subject areas also. Information about sources of electrical power, heat and water supplies, the presence and characteristics of local construction materials suitable for making grout (particularly clay and cement for the clay-based grout), transportation, and the status of communication lines and other services must be included in this section. Map scales for this section should be on the order of 1:25,000. The technical characterization of planned underground workings is presented in a project report chapter called "General Construction Plan for a New or the Restoration of an Old Operation. " The characterization comprises concise information about the purpose of the workings, the planned depths (for shafts) and the length (for horizontal and inclined workings), the inside and excavated diameters (for shafts), the cross-sectional area (for inclined and horizontal workings), and the face and mouth markers. If excavated underground workings exist in the region, then a concise description of them must be provided. The characterization of all excavations and all operational conditions must be specified. The location within the general structure of the proposed operation is specified. Flow charts must be included in this section that show: 1) the plan for opening the deposit, 2) the plans of the mining operations, and 3) the planned geological sections as they relate to the main workings. These graphical flow charts and appendices are drawn in scales of 1:2000 or 1:5000. 2.1 GEOLOGICAL CHARACTERIZATION The geological characterization of a site of proposed underground workings includes the following principal subject areas: stratigraphy, lithology, structural geology and a characterization of the status of fracturing. 2.1.1 STRATIGRAPHY AND LITHOLOGY A description of the geological section of the rocks to be intersected by the planned underground workings is complied on the basis of: 1) research data derived from core extracted from exploratory boreholes and monitoring boreholes, 2) the documentation and mapping of all natural out- crops in the region, 3) the data from all existing under-ground workings in the regions where operations are being canied out already, along with data from adjacent regions, 4) the data from surface and borehole geophysical investigations (standard and specially developed logging methods, and 5) regional stratigraphy. The geological description of the rock must express the maximum detail possible. The description provides the name of the rock, the granulometric composition (for fragmented rock), the composition and type of stratification, the drilling characteristics of the rock, a visual estimate of porosity and density for each stratum identified, the karstic

Jan 1, 1993

By Frank McKinley

This paper discusses the basic requirements covering the area between the initial discovery of a deposit and a decision as to whether or not the deposit will support an economically sound mining venture. The procedure for gaining the necessary information and the sequence of steps is in .some respects parallel to gaining like information on deposits other than the sand type. For the sake of simplicity the stages and sequence are presented as follow: first, the initial reconnaissance drilling; second, the exploration drilling to permit initial ore body estimates; third, metallurgical testing; fourth, the estimate of plant and operating costs; and last, the economic balance. The objective of the reconnaissance drilling is to collect sufficient information to reach a decision as to the advisability of further exploration or the abandonment of the area. This initial phase will comprise, in addition to some drilling, a thorough reconnaissance of the area, a study of the best geological and topographic maps of the region, and a study of any literature available, all under the guidance of a geologist.

Jan 1, 1958

By Paul Soros

Lord Robens, Chairman of the National Coal Board of England announced recently to the world press plans for construction of the largest bulk terminal in Western Europe. This should result in annual freight savings of 22.4 million dollars and between 150 and 190 million dollars of new export business. These are rather substantial amounts for any mining enterprise. Or to put it another way, opportunities to make substantial savings in the delivered price of a highly competitive commodity such as coal are few and far between. One area where such opportunities still exist is in the economical; movement of bulk materials between producer and consumer.

Jan 1, 1966

By Ken Santini, Ronald R. Bauer, Joseph R. Copeland

Wollastonite, named after W.H. Wollaston, an English chemist and mineralogist, is a calcium metasilicate having the chemical formula CaSiO2. Although it is a unique mineral, wollastonite has a short history of industrial use. Wollastonite is the only naturally occurring, nonmetallic, white acicular mineral. Its acicularity is the main reason for its ascendancy in the late 1970s and 1980s as a reinforcing filler and as a replacement for short-fiber asbestos and short-fiber milled fiberglass. Wollastonite is used in applications ranging from bowling balls to automobile fenders, from ceramic tile to automobile brakes, and from thermal insulation board to protective industrial coatings. The United States is the largest producer of wollastonite, with China, India, and Finland as the other three major sources. The United States, Europe, and the Far East are where most of the production is consumed. Geology Mineralogy and Physical and Chemical Properties Wollastonite, a member of the pyroxenoid mineral group, has the theoretical composition of 48.3% CaO and 51.7% SiO2. Iron, manganese, magnesium, or strontium may substitute for some of the calcium. Commonly associated minerals include garnet, diopside, calcite, quartz, epidote, apatite, and sphene. Some of the physical properties of wollastonite are listed in [Table 1]. Wollastonite is largely chemically inert; however, it can be decomposed in concentrated hydrochloric acid. Some wollastonite will fluoresce under shortwave or longwave ultraviolet light, or both, with colors ranging from pink-orange to yellow-orange and, more rarely, bluish green. In addition, wollastonite may show phos¬phorescence. Because of its unique cleavage properties wollastonite breaks down during crushing and grinding into lath-like or needle-shaped particles of varying acicularity. This particle morphology imparts high strength and is therefore of considerable importance in many of the markets for wollastonite. The acicularity of particles is defined by their length:width, or length:diameter, ratio (i.e., aspect ratio). Individual particles, even the smallest ones, commonly ex¬hibit an aspect ratio of 7:1 or 8:1 and have an average diameter of 3.5 gm. Low aspect ratio products (powder wollastonite, or milled grades) with 3:1 to 5:1 aspect ratios are used as general fillers, in ceramics, and in metallurgical fluxing. High aspect ratio products with ratios of 15:1 to 20:1 are used as functional fillers for rein¬forcing thermoplastic and thermoset polymer compounds and as a replacement for asbestos. The dry brightness and whiteness of wollastonite are also important in determining its suitability for certain filler and ceramic applications. When pure, the mineral is brilliantly white, but impurities may color it cream or gray. Brightness is determined by measuring the reflectance of finely ground powder against a stan¬dard that is assigned a brightness of 100. Magnesium oxide and barium sulfate are the two standards used. G.E. brightness, a term used in North America, refers to brightness measured with a Gen¬eral Electric reflectometer. Commercial wollastonite products usu¬ally have a G.E. brightness ranging from 85 to 95. The Hunter method is also used to measure the brightness of wollastonite. Loss on ignition (LOI), another important property in determining applications for wollastonite, is the amount of volatile matter driven off when the mineral is heated to 1 000°C. Com¬mercial wollastonite products have an ignition loss ranging from 0.5 to 2.0%. Wollastonite's naturally high pH of 9.9 (10% water slurry) is of major importance to its use in the coatings industry. Coatings formulators use milled grades as a pH stabilizer in interior and exterior PVA (polyvinyl acetate) and acrylic latex paints. There are two polymorphs of calcium silicate: wollastonite, a low-temperature form, and pseudowollastonite, a high-temperature form. Conversion of wollastonite to pseudowollastonite occurs at about 1 120°C and results in an increase in the coefficient of expansion and a color change. Pure white wollastonite may change to a cream tint or to various shades of red or brown. This color change is thought to be due to the presence of iron and/or strontium.

Jan 1, 1994

By John B. Mitchell

Approximately 90% of all potash produced is employed as a fertilizer, either directly or with nitrogen and phosphorus. The remaining 10% is utilized in the manufacture of other chemical products, The original source of potassium was wood ash (hence the name potash), However, today the term potash refers to all commercially important salts of potassium. Sylvite, usually found associated with halite, is the predominant economic potash mineral; carnallite a lesser important source of potassium chloride, while langbeinite is important as a source of potassium sulphate. The world's first potash mining operation commenced in Strassfurt, Germany about 1860, Since that time the industry has grown steadily to its present annual volume of about 30, 000, 000 tons of potassium chloride products or 18, 000, 000 tons of K2O equivalent, potassium chloride or "muriate of potash" being equivalent to 63. 1% pure K2O, WORLD POTASH RESERVES ARE NOT EVENLY DISTRIBUTED The earth's crust contains 2 to 3 per cent potassium, mostly in the form of insoluble silicate minerals. The economically important deposits, however, are formed from brines concentrated by evaporation. The world's most important commercial deposits are of Devonian and Permian age, however soluble potassium bearing salts are presently being concentrated by evaporation in several drainage basins, notably Searles Lake, California, Great Salt Lake, Utah' and in the Dead Sea. At least twenty-four countries are known to have reserves of potash: Canada and the USSR have over 80% of the presently known world reserves, (Figure 1)

Jan 1, 1972

By Floyd M. Thorman

Gypsum is the crystalline chemical compound CaS04?2H20. A close chemical relation - and frequently occurring with Gypsum ? is Anhydrite which is Cask. Gypsun has wide commercial use because relatively simple heat processing reduces it to Plaster of Paris. While Anhydrite can be converted to Gypsum and thence to Plaster of Paris, the procedure is not simple and is quite costly. Anhydrite, however does have use in the agricultural field and in the Portland Cement industry. Occurrence of Gypsum in the earth structure is usually near or at the surface. Most underground mining is at 60 to 100 feet although one mine in southwest Virginia reaches a depth of 1300 feet. Gypsum is one of our softest minerals, rating only 2.0 on the Mohs scale of hardness. Specific gravity is 2.3 to 2.4. It is soluble in water but only slightly so. Interestingly, it is more soluble in cold water than in hot. For example, one part Gypsum dissolves in 370 parts water at 106° Fahrenheit while at 212°F. the water requirement is 452 parts. Compressive strength of massive Gypsum runs about 3000 lbs. per square inch. Color ranges from grey and brownish-grey to white.

Jan 1, 1973

By John L. Shafer

A process for the conversion of stibnite (Sb2Sj) concentrates, crude antimony oxide, or metal to a pure cubic antimonous oxide (senarmontite) has been developed on a laboratory scale. The conversion of stibnite to senarmontite has been piloted. The high purity of the final product is the result of forming antimony trichloride as a low temperature distillable intermediate. To obtain the antimony trichloride the stibnite, or crude oxide is slurried in molten antimony trichloride and reacted with gaseous hydrogen chloride. Antimony metal is oxidized to the trichloride with chlorine. The hydrogen sulfide produced from the hydro- chlorination of stibnite can be upgraded to a strength of 95% or greater for further treatment. The crude antimony trichloride is separated from the gangue by a preliminary evaporation and then is fractionally distilled and the trichloride distillate has less than 50ppm of arsenic and lead combined (the most troublesome impurities in antimony processing). The purified antimony trichloride is then hydrolyzed with sodium or ammonium hydroxide to produce the cubic form of antimonous oxide (senarmontite) to the exclusion of the rhombic form (valentinite) which is photosensitive. The advantage of this process is the ability to treat a wide range of antimony ores, concentrates, and metal to yield a high purity oxide in a controllable range of particle sizes.

Jan 1, 1975

By William F. Lawrence

Within ten to fifteen years, coal-fired power generating stations will be producing over 40 million tons of coal-ash annually in the United States. The largest part of this ash will be emitted from the boilers, entrained in the off-gas stream and trapped as flyash. However, about 15 percent (six million tons) will he removed from furnace bottoms as bottom ash or molten coal-ash slag. In current practice, the molten coal-ash slap is generally water quenched and then transported either as a slurry or in granular form to storage or disposal areas. Although a small amount of this slag is marketed as abrasive grit or as roofing granules, most of it is considered a waste material which must be disposed of at considerable cost to the power companies and therefore to the public. The accom¬panying economic loss in terms of unused raw materials and displaced land is not as obvious but is just as real. The Coal Research Bureau at West Virginia University under the sponsorship of the U. S. Bureau of Mines has been examining the possible utilization of both coal-ash slag and flyash in the mineral wool industry as a method of partially alleviating the growing national problem of solid waste disposal. The potential marketing situation for mineral wool manufactured from coal-ash is illustrated in Figure 1. This bar graph depicts the growth in value of mineral wool shipments1 from 1949 through 1966. In this 17-year period, the value in¬creased by over 350 percent, more than 20 percent per year, despite a decrease in unit cost of mineral wool. It therefore appears likely that coal-ash could find a steady market as a supplement to existing sources of raw materials for mineral wool production.

Jan 1, 1970

By Euclid P. Worden

In 1977, an article in World Mining (1) reported a total of 2726 rotary blast hole drills in service. This figure included only those machines produced by three of the manufacturers building drills of this type. The total, therefore, is much higher: Rotary drilling in the mining industry is big business to the manufacturers and suppliers involved, and a significant cost item, to mine operators. The time has come to take a hard look at rotary drilling technology with an eye to re¬ducing costs by increasing drilling efficiency. The efficiency of any rotary drilling operation is measured in terms of the rate of penetration achieved by the bit. In blast hole drilling, five factors affect the rate of penetration. They are: 1. Bit selection 2. Weight on the bit 3. Rotary speed 4. Hole cleaning 5. Formation properties Of these factors, all but one may be control¬led by the operator. Looking at any one in detail may reveal possible improvements in the system. Cleaning the hole is a good place to start. In order for a bit to perform at its maximum capability, each tooth or insert should strike fresh, clean rock as it falls into its drilling position. If the tooth or insert lands on previously drilled cuttings, a major portion of the energy delivered to the bit is absorbed in re drilling this broken material. A major portion of the interest, therefore, should be directed to the proper cleaning of the bottom of the hole.

Jan 1, 1979

By Yi Zheng

Under normal circumstances, methane released along a longwall face represents only 10%-20% of the total me- thane emitted from the entire longwall panel. However, there might be a sudden surge of methane at the face which may cause a potential problem because the friction from shearer cutting, support movement, and scraper conveyor dragging can be ready ignition sources. Therefore, to predict the distribution of methane will be critical to prevent possible explosions. In this paper, methane dispersion patterns along a lognwall face are simulated under normal and abnormal conditions. With the simulation of methane released from the face, around shearer drum, and from the broken coal on the conveyor, places with possible high methane content can be identified by different phases of working process and shearer positions. Local ventilation measures are evaluated so precautionary measures can be planned ahead.

Jan 1, 2012

By AJIT SWAIN, SUNATI MOHANTY

The abstract discusses the importance of predicting the dewatering performance of industrial hydrocyclones from laboratory models. It highlights the challenge of scaling up design and operating parameters for efficiency estimation. The paper describes experiments with a 2-inch and 4-inch hydrocyclone using silica sand. It details the development of a model using the Nageswararao hydrocyclone model and a simulator to estimate model parameters. The model is validated with experimental data, and a new model is developed using 4-inch hydrocyclone data. The technique is then extended to predict dimensions for a full-scale dewatering cyclone operating at higher throughput and solid concentration.

Mar 30, 2022

By Duncan M. Lamb

Commercial computer "time-sharing" is a new and powerful tool for the engineer. It is a system of virtually simultaneous use of a digital computer by several individuals. Access to the computer is by means of a conventional teletypewriter which transmits over the regular telephone lines to the computer which may be located any distance from the user. Complex or repetitive computations can be programmed and the speed of computation is many times that which one can do with slide rule and desk calculator. The availability of such a commercial computer "time-sharing" system offered an opportunity to transform a tedious and time-consuming task into one that requires only a few minutes. Until the work of F. C. Bond produced widely accepted mathematical statements concerning the performance of grinding mills, the selection of the proper size equipment was done by comparison with similar operating equipment. Allis-Chalmers systematized Bond's work in a bulletin published in 1963 but the calculations are laborious and the final mill selection still required comparison of the calculated power draw with the power requirements listed in equipment catalogs. This was, however, a step forward from previous procedures. This paper discusses a rapid and simple method of determining the size and power requirement of overflow ball mills. A shared-time computer program has been developed which rapidly calculates and displays the physical dimensions, power requirements, grinding media size and quantity, as well as the important correction factors used. All of these data are calculated from input information which is usually available.

Jan 1, 1969

By T. B. Thompson

The Cripple Creek diatreme-intrusive complex is known primarily for its vein telluride-gold ores and, for major veins, their great vertical range (>990m). Less well-documented are the ores dispersed into the wallrocks adjacent to veins, the ores associated with hydrothermal and tectonic breccias, or mineralized zones within fluvial, lacustrine, and volcaniclastic rocks deposited within the diatreme complex. The ore-gangue minerals Here precipitated from oxidized, alkaline fluids that yielded an abundance of carbonate, sulfate, and oxide minerals along with minor base metal sulfide and precious metal telluride-s. Wallrock alteration is quite limited adjacent to veins and somewhat more extensive within hydrothermal and tectonic breccias.

Jan 1, 1991

By Robert E. Hershey

The phosphate industry is the fourth-ranking mineral industry in Tennessee; it has an annual value of 13,000,000 and a yearly production of almost 2,000,000 tons of phosphate ore. Tennessee, at present, is second in rank of phosphate production in the United States. In accord with the importance of this mineral commodity, the Tennessee Division of Geology, is conducting a continuing study of the industry' and the raw s, materials upon which it is dependent. Of the three type's of phosphate found in Tennessee, the brown phosphate rock of the Bigby faces of the Bigby-Cannon limestone is by far the most extensive in occurrence and is the only type being mined at the present time. Because of the importance of the brown phosphate ores, our Division has mapped , in detail the outcrop pattern of the Bigby facies of the Bigby-Cannon limestone. The geologic mapping was done by Dr C. W. Wilson, Jr. and others under his super-vision and the geology plotted on 7 1/2-minute topographic maps, with scale of 1 to 24,000 or 1 inch equals 2,000 feet. These maps will be available for use in the near future and will be published later-with complete geologic coverage.

Jan 1, 1960

By R. W. Sayers

The Duval Corporation porphyry copper deposits at Copper Canyon and Copper Basin, though widely separated, form an economic unit requiring integrated exploitation. Contrasts in mineralization, host rocks, and mode of occurrence present unique mining and milling problems. Mixed oxide-sulfide ore is treated in extensive dump leaching facilities in both areas. Complex copper-gold-silver ore is treated in a 4,000 tpd mill at Copper Canyon. In both areas, hypogene metallization occurs within large aureoles of metamorphism and hydrothermal alteration related to quartz monzonite intrusions of mid-Tertiary age. Supergene processes further altered the rocks and enriched the hypogene protore. At Copper Canyon, hypogene copper and iron sulfides with gold and silver occur in fractures, as partial replacement of favorable beds, and as disseminations in Paleozoic sedimentary rocks. The lower part of the Pennsylvanian Battle Formation was a particularly favorable host. Metallization occurs to a lesser extent in quartz monzonite. Metal zoning is well developed. The deposits at Copper Basin consist principally of supergene copper minerals in arenites of the Cambrian Harmony Formation. Oxidation of hypogene copper and iron sulfides in tactite zones has formed at least two commercial deposits; intersections of fractures with favorable beds exerted important ore controls.

Jan 1, 1968

By Charles K. Presley

This paper deals with drilling large diameter shafts for the mining and construction industry with diameters in excess of 3 feet to more than 20 feet in diameter. It discusses appropriate applications of the rotary drill method, linings for large diameter shafts, circulation systems,, and the limitations of the method. Each specific rotary drill method is determined by the geology of the area, the depth to be drilled and the formation fluids encountered. Shaft lining or casing must be improved to result in lighter weight, higher strength and lower cost. All phases of rotary drilling equipment must be improved to drill shafts in excess of 10 feet in diameter. As these goals are reached, more shafts of large diameter will be drilled by the rotary method for the mining and construction industry.

Jan 1, 1967

By Henry E. Swanson

In the early 1960's the Company, then named the United States Smelting Refining and Mining Company, was drilling the Continental ore body located near Fierro, New Mexico. Reserves of underground ore of sufficient quantity were indicated to build a mill. At the same time some ore from the Continental No. 1 mine was being milled at the Company's Bullfrog Mill, formerly a lead-zinc mill. The copper ore in comparison to the lead-zinc ores was very hard, abrasive, and heavy. These factors pointed out the possibility and attractiveness of autogenous grinding. While prior to this some study had been given to autogenous grinding, no large scale tests had been made. Such a program was carried out and from the pilot plant data the following was established: 1. Grinding of the ore by autogenous means could be accomplished. 2. This could be done in one stage; however, not at a satisfactory tonnage throughput rate. Thus, the use of a secondary unit has been employed. 3. Grinding in the secondary unit could be done by pebbles generated in the primary unit. This resulted in the scheme whereby the ore would be ground 100% autogenously. 4. Liberation of the copper minerals was excellent so that good recovery at a satisfactory concentrate grade would be obtainable.

Jan 1, 1976

By Earl G. Hoover

For most geologists and miners the term "asbestos" refers to a group of highly fibrous silicate minerals that readily separate into long, thin, strong fibers of sufficient flexibility to be woven, are heat resistant and chemically inert, and possess a high electric insulation and therefore are suitable for? uses where incombustible, nonconductive or chemically resistant material is required. The United States Mining Enforcement and Safety Administration (MESA) specifically refers to the naturally occurring minerals chrysotile. amosite, crocidolite, termolite asbestos, anthophyllite asbestos, and actinolite asbestos as "asbestos" if the individual crystal fragments have the following dimensions; length -greater than 5 micrometers, maximum diameter -less than 5 micrometers, and a length to diameter ratio of 3 or greater. Since asbestos has been identified as one of the ten most carcinogenic substances (a cancer causing agent) it has become, for many government regulatory agencies, a major issue concerning banning emissions to the environment.

Jan 1, 1978

By Kenneth A. Grace

Introduction The 1980s have not been kind to the mining industry, especially in the United States. As mineral commodities prices plunged, marginal producers were squeezed out and then major players were forced to cut back or close down operations. Base metal miners suffered the most. Gold was all that glittered. As had been the case throughout min¬ing's history, exploration activity was an early victim of these depressed conditions. Mining companies had to economize drasti¬cally and exploration was deemed a nones¬sential activity. Funding for new explora¬tion ventures dried up as mining was seen as a poor investment. A national magazine even proclaimed the death of the industry. Indeed, ignoring matters of independ¬ence of supply and the relationship of min¬eral production to national security, it was argued that mining was but a small cog in the overall scheme of things in the United States. The industry made a relatively small contri¬bution to the gross national output. We were becoming a service industry economy, re¬member? But what of those countries where mining plays a major role in the economic well-being? In some, mining is the national economy. In a few specific cases, special conditions actually brought prosperity. Copper production in Chile is one example. There, high grade copper, low production costs, and a technically advanced industry reaped the benefits of mine closures else¬where. In most other cases, however, par¬ticularly in the lesser developed countries, whole economies were devastated. This article will show what one major mineral producer, Canada, did to ensure the survival and even growth of its minerals exploration activity during these lean years. Background While Canada is among the world's mining leaders, mining is not its dominant industry. Still, it plays a far more important role than in the United States. It is a major earner of foreign exchange, currently accounting for about 25% of the total value of exports. Through spinoffs and a multiplying effect, it is a significant employer. In the far north, particularly, mining is the major nongovernment industry and a leading factor in the opening up of frontier territory. The industry cannot be allowed to die because it is often the main economic underpinning for vast, remote areas. Thus, exploration for new deposits cannot be cur¬tailed significantly without it having a long¬term negative impact on the very fabric that melds such a large, sparsely-populated ex¬panse of country into a nation. Over the years, Canadian governments have employed various means to encourage the development of new mines. Often, these incentives were tax-oriented, such as the three-year income tax holiday that applied to new mines in the 1950s and 1960s. The advantage of the tax connection is that any such incentive policy can be applied across the board to the 10 provinces and two territories that make up the federation of Canada. This is important because mining, except for the two federally-administered northern territories, comes under provincial government jurisdiction. Mining taxation is a complex give-and-take between the central and provincial authorities. In Canada, expenditure on mineral exploration is an allowable cost against reve¬nue for tax purposes. This works well pro¬vided there is some revenue from which to deduct. New exploration companies, those with no income from mining activities, de¬rive little benefit from this type of tax provi¬sion. Similarly, in times of depressed prices and reduced or nonexistent profits, the tax deductibility of exploration spending loses its value even for the major mining compa¬nies. To encourage exploration in Canada during the lean years, a different sort of incentive was required. The instrument used during the 1980s was again tax connected. It became known as flow-through financing or, simply, flow-through shares. When it assumed its final shape, it worked dramati¬cally. Flow-through shares Flow-through shares are so-named because they permit tax benefits earned by a corporation to 'flow-through' to the share¬holder. Basically, when an investor buys a flow-through share and the proceeds de¬rived by the company from this transaction are used for Canadian exploration, the in¬vestor can claim a deduction for tax pur¬poses as if the exploration expenditure was made by him personally. Flow-through shares go back to the early 1970s when Canada revamped its mineral income tax law. At that time, it permitted full deduction of exploration and development expenditures and provided for an automatic depletion allowance of one¬ third of operating profits from mining. There was also the three-year income tax holiday for new mines. New legislation replaced the depletion allowance with an earned depletion arrange¬ment whereby one dollar of depletion was earned for every three dollars spent on ex¬ploration and development. This earned depletion was `banked' during a transitional period (to 1974). After that it could be deducted from resource profits up to a maximum of 25% of such profits in any one year, with the excess carried forward. To promote exploration and mine de¬velopment in Canada, the earned depletion allowance plus the continued deductibility of exploration and development expendi¬tures permitted the recovery of risk capital before taxation. The three-year tax holiday, however, disappeared. Also, mining com¬panies that did not reinvest in exploration lost the depletion allowance benefit.

Jan 1, 1989