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By F. M. Lewis, J. F. Meyers

This second progress report of grinding presents comments regarding ball consumption and data pertaining to the hydroscillator, which is closed circuited with the tricone mill. A study and postulate of how balls function is presented. The paper summarizes cost reduction obtained by the method of "grinding for the tail race" rather than for "mesh tons." AT the Regional meeting in Columbus, Ohio, in September 1949, the authors presented a progress report of the first year's operation with a Hardinge tricone mill in closed circuit with a Dorr hydroscillator. The present report covers our findings on this grinding circuit to January, 1950. In order to clarify our position, the authors wish to state that no invention or discovery is claimed. The Tennessee grinding circuit is simply an engineered arrangement of known equipment arranged to incorporate all of the recognized efficiency factors of comminution as they are known today. As we concluded our first report, it was not clear how effective the Tennessee mode of operation would be on harder ores. The only information we had at that time was that the Bond grindability test at 48-mesh gave 6.04 g of undersize per revolution. A later test on the same sample at 100-mesh reduced this to 2.04 g, which is definitely in the harder ore class, and which makes the reported 8.80 kw-hr per ton of —200-mesh produced a very creditable figure. Hydroscillator Operation The machine as now developed has proved dependable and easy to operate. It starts easily under full load and responds quickly to operating adjustments. The hydraulic holes in the oscillating plate do not plug when shut down under full load. Absolutely clean hydraulic water is essential. An Elliott water screen or similar device should be an essential part of the machine to keep all scale and trash of all kinds from the hydraulic compartment. The shift operators have expressed approval of the machine. In table I we show a typical screen analysis of the hydroscillator rake sand as compared to conventional classifier rake sand on our ore. We have previously reported that of the 28.7 pct reduction in power, the hydroscillator contributed 6 pct, on a —200-mesh basis. This is a conservative figure. Some of our test runs indicated that the saving was as high as 10 pct. Laboratory studies by the Dorr Co. engineers indicate that still greater efficiency is possible. Nevertheless, the 10-ft plate is overflowing 2100 tons per day at 3 to 4 pct + 65-mesh, which is a very creditable performance by

Jan 1, 1951

By A. B. Wilder

We study the past Because it is a guide to the present and a promise for the future. The struggle for a better world is strengthened By the hopes, ambitions, and deeds Of those who were before us. As we look backward Our attention is directed forward. ONE hundred years ago, the manufacture of steel from molten pig iron without the use of fuel first began. In the earlier part of the nineteenth century the crucible process was the principal steelmaking method. It was a costly process, producing only a few pounds of steel at a time; so, most of the ferrous metal output was in the form of wrought or pig iron. With the perfection of the converter technique it became possible to produce low cost steel by the ton, thereby completely changing the structure, not only of the ferrous metal industry, but also of industrial production in general. This was the turning point from the Iron Age to the Age of Steel. William Kelly (Fig. 2), Sir Henry Bessemer (Fig. 1), and Joseph G. Martien experimented with the process before 1856. William Kelly began in Eddyville, Ky., in 1847 and has been given credit for first discovering the principle of the pneumatic converter process. Several years later in England Henry Bessemer independently conceived a steelmaking process similar to Kelly's. Bessemer made public his invention at the annual meeting of the British Association for the Advancement of Science held at Cheltenham, England, August 1856. As a result of his paper, "On the Manufacture of Malleable Iron and Steel Without Fuel," and his progressive leadership in the years to follow, the process became permanently identified with the name, Bessemer. Credit for the commercial adaptation of the process must be given two additional persons. Robert Mushet (Fig. 3) in 1856 in England recognized the necessity of deoxidation and recarburization of the converter product and evolved the technique for adding high manganese iron following the blow. In Sweden, in July 1858, G_ F. Göranson [ ]

Jan 1, 1961

By J. T. Shimmin

THE past twenty-five years has been a period of unparalleled improvement in all lines of mining and metallurgical equipment, but probably none has undergone greater refinement and development than the vacuum filter. Beginning a quarter of a century ago, there has been steady advancement in the art of vacu-um filtration until today its use has become virtually standard practice for dewatering throughout the entire metallurgical industry as well as in important parts of the chemical and industrial processing fields. The credit for the first successful application of vacuum filtration 'at the Consolidated Mercury mines in Utah in 1902 undoubtedly belongs to George Moore. There, it is said, his filter reduced the loss of gold in the slime and sand from $1.25 to 40c. per ton. Successful applications were subsequently made by Mr. Moore at the Liberty Bell mines, Telluride, Colo., the Lundberg, Dorr &Wilson mill at Terry, S. D., and elsewhere. E. L. Oliver is generally credited with, having done the most to work out the necessary continuity of op-eration exemplified in the well-known continuous vacu-um filter which bears his name. Others made improve-ments also, but in my opinion all the new ideas advanced in recent years are modifications of the fundamental principles originated by the two pioneers, Moore and Oliver. Considerable interest has been shown recently in the new type of continuous internal-type vacuum filter which is associated with my own name1. In response to frequent inquiries regarding it and the steps which led up to its invention, I am giving herewith a brief account of the early history of this development and some of the more important installations which have been made during the last year or so. A. M. Nicholas (now deceased), an Australian engi-neer, conceived the idea, several years ago, of manu-facturing a continuous vacuum filter with the filter medium applied upon the inside of the drum, as con-trasted with existing drum filters in which the medium is applied externally. Nicholas recognized that a ma-chine of this type would be simpler than one with a tank and would overcome some of the difficulties en-countered with tank filters on certain classes of pulps, and he appreciated the value of having filtration take place in the same direction as the gravitational settle-ment of the solid particles in the pulp, the pulp being retained within the drum instead of being held against the outside surface. The ease of starting up after a shut down was likewise realized by Nicholas. It was tried in the United States, but was not entirely success-ful primarily due to mechanical defects.

Jan 5, 1928

MR. L. C. BALL, chief government geologist, Queensland, wrote: This paper is intended as a severely mechanical exposition of the means adopted to deal with tremendous inflows of water concurrently with development and exploitation; but incidentally it serves as a splendid exposition of close co-operation maintained between the geological and engineering branches of this large organization.I have been impressed by the completeness of the mine plans of 'Mount Isa Mines Ltd.; but only such a paper as this has brought fully to my understanding the difficulty and complexity of the solid geometry involved in the detection and plotting of the orebodies and their stratigraphic control, including faults and large-scale brecciations, and the managerial foresight that set going the initial investigations.The company's geological branch of course must be given full credit for the results attained, but it gives me pleasure that the Geological Survey of Queensland has been closely associated in much of the study.It is noted that complete drainage was affected, but it would be interesting to learn whether the brecciated zone will again become waterlogged and whether from above or from below, and whether there has been any change in the dissolved mineral content of the water as the work progressed.

Jan 1, 1939

By Edward Steidle

Those who have followed the rapid progress in rock-dusting bituminous-coal mines must admit that opinion crystallized during the year just closed in support of this preventive of coal-dust explosions. Up to 1924 only one mining company in America practiced rock-dusting on a large scale, but during 1924 forty-two companies had adopted this safety measure, and the "boom" is expected to extend over the next two or three years. Alabama is represented by 1 company, Colorado by 3, Illinois by 4, Kentucky by 1, New Mexico by 4, Pennsylvania by 20, Utah by 8, and Wyoming by 1. A total of about 500 miles of entry has been dusted. Illinois leads with 275 miles of dusted entries and Pennsylvania holds second place with about 175 miles. In each case there is a sense of great security, not only on the part of the operator but by the miner as well. It is also interesting to note that during 1924 the compensation rating or inspection bureaus in twelve of our coal-producing states revised their rating schedules so that a credit would be given for rock-dusting. This credit ranges from 10 to 20 cents per $100 payroll. Recent drastic federal and state regulations approved by mine operators made rock-dusting compulsory in bituminous coal mines in Utah, beginning July 1, 1924. Legislative action favorable to rock-dusting may be expected in other states. Colorado has already proposed a change in its laws, and Pennsylvania, Maryland, Washington, and West Virginia are giving the matter consideration. If the rock-dusting problem is handled properly and proves to be entirely successful, no mining man of any standing will delay applying it in his mine. State legislation regarding this matter may or may not solve the problem. At present, the mining companies that are rock-dusting of their own choice are doing it carefully and thoroughly. In Utah, some are doing it conscientiously, trying to get what benefits can be obtained while others are reported to be doing it only to keep within state regulations. In any event, if we are to have new legislation, it is essential that the various states know what they are about and then, if possible, work for uniform regulations.

Jan 1, 1925

By Benjamin L. Miller

The essential differences expressed by the different speakers participating in this symposium concern merely the relative emphasis placed on the subjects that are commonly included under the term "geophysics" and the branches of science that form the basis for investigations in this field. In order to appreciate the present situation it may be profitable to briefly refer to a few historical matters. One can find almost countless descriptions of geological phenomena long antedating the introduction of the title of "geology," which has been credited to Richard de Bury in the fourteenth century. Interpretations, when they were offered, were generally pure speculation. Only toward the close of the eighteenth century do we find theories developed as the result of observations and tested by additional observations. It is difficult to select and give proper credit to the individual who was particularly responsible for turning geology into a distinctly observational science. william Smith, who has been called the "Father of English Geology," certainly represents the period when observation was the only method used. As he traveled through the British Isles, "sometimes 10,000 miles in a year," he was continually making notes of his observations. Geikie says: "His plain, solid, matter of fact intellect never branched into theory or speculation, but occupied itself wholly in the observation of facts." William Smith, with others of his time, definitely laid firmly the foundations on which modern geology has been built. Field and laboratory observations can no longer be said to constitute the sole basis for geologic contributions but we have not laid aside the methods of Smith and his followers. It is folly to underestimate the fundamental value of the observational part of geology in the present. The objection to purely observational geology is that it is mainly qualitative and not quantitative, general and not specific. No one can deny this charge and probably there are few who do not welcome every method or process whereby we can put aside generalities for definite established values. Physics is the science that has particularly come to the aid of the geologist in this respect. Contributions of PhYsics It is not the intent of the writer to enumerate or to evaluate all of the contributions to geologic advance in the field of. physics. A few only are used for the purpose of illustration, When Clarence King, Director of the United States Geological Exploration of the Fortieth Parallel, invited Ferdinand Zirkel to study 2500 thin sections of rocks collected from the western United States, the use of the microscope came into general use. Zirkel's report was published in 1876. He was not the first to use transmitted light for microscopic rock determination, some work having been done by Henry Clifton Sorby and others some years earlier, but he was the first to put into general use this method. We may well daim that this

Jan 1, 1946

By Benjamin L. Miller

The essential differences expressed by the different speakers participating in this symposium concern merely the relative emphasis placed on the subjects that are commonly included under the term "geophysics" and the branches of science that form the basis for investigations in this field. In order to appreciate the present situation it may be profitable to briefly refer to a few historical matters. One can find almost countless descriptions of geological phenomena long antedating the introduction of the title of "geology," which has been credited to Richard de Bury in the fourteenth century. Interpretations, when they were offered, were generally pure speculation. Only toward the close of the eighteenth century do we find theories developed as the result of observations and tested by additional observations. It is difficult to select and give proper credit to the individual who was particularly responsible for turning geology into a distinctly observational science. william Smith, who has been called the "Father of English Geology," certainly represents the period when observation was the only method used. As he traveled through the British Isles, "sometimes 10,000 miles in a year," he was continually making notes of his observations. Geikie says: "His plain, solid, matter of fact intellect never branched into theory or speculation, but occupied itself wholly in the observation of facts." William Smith, with others of his time, definitely laid firmly the foundations on which modern geology has been built. Field and laboratory observations can no longer be said to constitute the sole basis for geologic contributions but we have not laid aside the methods of Smith and his followers. It is folly to underestimate the fundamental value of the observational part of geology in the present. The objection to purely observational geology is that it is mainly qualitative and not quantitative, general and not specific. No one can deny this charge and probably there are few who do not welcome every method or process whereby we can put aside generalities for definite established values. Physics is the science that has particularly come to the aid of the geologist in this respect. Contributions of PhYsics It is not the intent of the writer to enumerate or to evaluate all of the contributions to geologic advance in the field of. physics. A few only are used for the purpose of illustration, When Clarence King, Director of the United States Geological Exploration of the Fortieth Parallel, invited Ferdinand Zirkel to study 2500 thin sections of rocks collected from the western United States, the use of the microscope came into general use. Zirkel's report was published in 1876. He was not the first to use transmitted light for microscopic rock determination, some work having been done by Henry Clifton Sorby and others some years earlier, but he was the first to put into general use this method. We may well daim that this

Jan 1, 1946

By Benjamin L. Miller

THE essential differences expressed by the different speakers participating in this symposium concern merely the relative emphasis placed on the subjects that are commonly included under the term "geophysics" and the branches of science that form the basis for investigations in this field. In order to appreciate the present situation it may be profitable to briefly refer to a few historical matters. One can find almost countless descriptions of geological phenomena long antedating the introduction of the title of "geology," which has been credited to Richard de Bury in the fourteenth century. Interpretations, when they were offered, were generally pure speculation. Only toward the close of the eighteenth century do we find theories developed as the result of observations and tested by additional observations. It is difficult to select and give proper credit to the individual who was particularly responsible for turning geology into a distinctly observational science. William Smith, who has been called the "Father of English Geology," certainly represents the period when observation was the only method used. As he traveled through the British Isles, "sometimes 10,000 miles in a year," he was continually making notes of his observations. Geikie says: "His plain, solid, matter of fact intellect never branched into theory or speculation, but occupied itself wholly in the observation of facts." William Smith, with others of his time, definitely laid firmly the foundations on which modern geology has been built. Field and laboratory observations can no longer be said to constitute the sole basis for geologic contributions but we have not laid aside the methods of Smith and his followers. It is folly to underestimate the fundamental value of the observational part of geology in the present. The objection to purely observational geology is that it is mainly qualitative and not quantitative, general and not specific. No one can deny this charge and probably there are few who do not welcome every method or process whereby we can put aside generalities for definite established values. Physics is the science that has particularly come to the aid of the geologist in this respect. CONTRIBUTIONS OF PHYSICS It is not the intent of the writer to enumerate or to evaluate all of the contributions to geologic advance in the field of physics. A few only are used for the purpose of illustration. When Clarence King, Director of the United States Geological Exploration of the Fortieth Parallel, invited Ferdinand Zirkel to study 2500 thin sections of rocks collected from the western United States, the use of the microscope came into general use. Zirkel's report was published in 1876. He was not the first to use transmitted light for microscopic rock determination, some work having been done by Henry Clifton Sorby and others some years earlier, but he was the first to put into general use this method. We may well claim that this

Jan 1, 1941

By C. Richard Tinsley

INTRODUCTION Project financing has been defined by various authors in this book. It is founded on reliance upon the project's own future cash flows and secondarily on the collateral value of the asset base developed. It is chiefly provided by the banking community who, after an assessment of the risks involved (See Chapter 9) analyse the company's presentation (See Chapter 10) in order to structure a financing package often at a leverage of up to 80% debt. This paper describes the various support and structuring techniques used to delimit and abate the risk components perceived from the banks' experience on project development especially for the period before cash flow is generated (pre completion). ADVANTAGES The advantages of project financing extend beyond the offloading of risks to banks. Among the advantages are the following: 1. Longer loan maturity than conventional, unsecured financing; 2. Loan disbursement and repayment tailored to specific mine; 3. Ability of a joint venture without a "track record" to raise financing; 4. Obtain financing where further direct borrowing (corporate credit) limited by existing indentures; 5. Possibility of arranging finance off-balance sheets; 6. Leverage return on equity; 7. Obtain tax savings with certain project financing structures; and 8. Obtain flexible loan repayment conditions. It can also be said that from the point of view of the company, project financing has certain disadvantages which can be summarised as follows: 1. Perceived higher cost (risk premium) compared with straight corporate credit; 2. More documentation; and 3. Need to negotiate risk-sharing aspects. The main attraction of project financing is the ability to pass certain risks on to the lenders within a flexibly funded transaction. (For a more detailed description of the specific risks see the author's paper at the beginning of Chapter 9. The same risk system is followed here.) The typical project financing has corporate support prior to completion and will usually carefully control the resultant cashflow after completion to ensure the bank does not unnecessarily assume further risks of an equity nature. WITHIN THE COMPANY'S CONTROL Operating Risk This is broken into three interrelated segments for ease of description. Technical Component: This must be specifically addressed if new technology or unproven adaptations are to be used. The banks will have scrutinized the sampling and bulk testing work, perhaps grilling the geological, mineral processing, metallurgical, and mining engineering staff or consultants directly. A number of supports are available such as: TECHNOLOGY GUARANTEE: Either the company itself or the process developer will guarantee that the technology will work for a period of, say, six months to two years after startup. If not, then financial penalties will apply although these are rarely sufficient to repay the loan. Many process developers are weak financially and may have little substance to back such a guarantee.

Jan 1, 1985

By E. D. Gardner

This is one of a series of papers describing mining and related subjects affecting mining in western mining districts and mineralized areas. The parts of this paper pertaining to current production, mining and milling methods and practices, and general conditions affecting mining were collected principally during a field survey made in May 1935. Some original data obtained on previous visits to the area are also included. The history, geological background, and past production of the mines and district are largely abstracted from previous publications, for which due credit is given later in the test. The principal districts in the Black Mountains are the Oatman or San Francisco and the Union Pass or Katherine. This range contains the principal producing mines of the State, in which gold is the only important metal. Although the total production of gold is relatively small as compared to other districts where the precious metals are obtained as a by-product in copper min¬ing, the area is one of considerable economic importance to the State.

Jan 1, 1936

By Ava Walker

The first form of a surety bond was an honest handshake between two or more parties agreeing to a decision, and their personal guarantee of following through to completion. This has all changed. In 1895, the United States Treasury Department disclosed that $35 million worth of personal surety guarantees on file had become worthless. A law was then passed requiring all surety bonds, in favor of the United States, must be corporate surety bonds. Today, a surety bond is one of the nation's leading fi¬nancial instruments used to guarantee the completion of an obligation. One hundred-fifty years before cor¬porate surety bonds, outcrops near Richmond, VA, were being mined. These surface mines became under¬ground mines. Today, both are still being used to obtain a leading energy source, coal. Since that time, more than 5956 km2 (1.47 million acres) of coal mined lands have been reclaimed in the US (Coal News, August, 1987). More than 25,000 state and Federal mining permits cover¬ing 14,164 km2 (3.5 million acres) have been issued during the last 10 years. Coal production has exceeded 7.2 Gt (8 billion st). More than 5665 km2 (1.4 million acres) of mined land has been reclaimed by active coal mining opera¬tions and 267 km2 (66,000 acres) of abandoned mined lands have been re¬claimed by others. Reclamation bonds were freely writ¬ten in the 1970s. So why are they almost extinct today? Contract bond losses have been severe in the past several years, sureties reporting losses exceed¬ing 110%. But the same proof is not provided on coal reclamation bonds. A surety bond is generally required when one party has an agreement with another party, and that party wants a guarantee from a third party that a job will be completed according to the terms and conditions of a written contract. In the case of a reclamation bond, the surety company (surety) is the financial party. It extends the credit and a guarantee to the obligee (the State, Commonwealth, or Office of Surface Mining) that the principal (the coal operator/company) will complete the terms and conditions of the contract (the rules and regulations governing mining and reclamation). The Surety Association of America defines a surety bond as an agreement providing for monetary compensation should there be a failure to perform specified acts within a stated period. Webster's Dictionary defines surety in the following ways: "l: the state of being sure; 2a: a pledge or other formal engagement given for the fulfillment of an undertaking and; 3b: one who has become legally liable for the debt, de¬fault, or failure in duty of another." Banks never make accommodation loans. Either the loan is good or no loan is made. Surety companies feel the same way about surety bonds. In fact, the average person does not realize the dangers of becoming surety for another. How does a surety determine if a company is worthy of receiving surety credit? How is a coal account under¬written today for an obligation that may not be released for many years? When a surety company executes a reclama¬tion bond, it financially puts its name behind the coal company and its guaran¬tee that should the coal miner default on the obligation, the surety will fulfill the contract. How is the surety to determine if a coal company may still be in business five, 10, 20, or 40 years from today?

Jan 1, 1989

By M. Jarvis, D. B. Dreisinger, T. Hitchins

Mineral carbonation (MC) has been extensively researched all over the world since it was found as a natural exothermic process to permanently and safely sequester CO2. In order to accelerate the natural process, various methods for carbonation of Mg-/Ca-silicate minerals and other industrial wastes have been studied. It has been found that the MC efficiency will increase with an increase of CO2 pressure, retention time, temperature, mass ratio of Mg or Ca to Si in minerals, specific surface area, and the slurry concentration in a specific range, and with the introduction of an effective catalysts, for example, 1M NaCl and 0.64M NaHCO3 or carbonic anhydrase. However, there still is not a successful industrial application because of high economic cost and slow reaction rate. It is not economic to exploit Mg- and Ca-silicate minerals deposits or tailings to sequester CO2 by MC, due to the cost of grinding and heat pre-treatment and in some cases the whole sequestration process may result in more CO2 emissions than the amount of CO2 sequestered, due to the requirements of energy inputs. The process however, may be profitable as a whole (with carbon credits). It is suggested to combine MC with recovery of valuable metals from ore deposits in order to reduce the cost for MC by cost sharing for mineral recovery.

Jan 1, 2017

By Dennis J. McCarthy

TAX TREATMENT OF EXPLORATION AND DEVELOPMENT EXPENSES Exploration Expenditures General Principles. Exploration expenditures are expenses incurred within the United States or the Outer Continental Shelf for the purpose of ascertaining the existence, location, extent or quality of any deposit of ore or other mineral. Section 617 of the Internal Revenue Code permits a taxpayer to elect to deduct these expenditures currently. In default of election, exploration expenditures must be capitalized and included in the basis of the mineral property for purposes of determining cost depletion. Entitlement to Deduction. In order to qualify for current deduction, exploration expenditures must be incurred prior to the commencement of the development stage, i.e., when mineral deposits are shown to exist in sufficient quantity and quality to reasonably justify commercial exploitation. Generally, expenditures for geological and geophysical investigations, reconnaissance, surveying, testpitting, trenching, drilling, driving of exploration tunnels and adits and similar types of work constitute exploration expenditures if incurred prior to the commencement of development. However, expenditures to further delineate the extent and location of an existing commercially marketable deposit are not exploration expenditures. Exploration expenditures may be incurred from within a producing mine to ascertain the existence of what appears to be a different ore deposit. Expenditures for property which is subject to an allowance for depreciation are not deductible under §617. However, depreciation properly allowable on assets used in exploration is an exploration expenditure. Election to Deduct Exploration Expenditures. The election to deduct exploration expenditures is made by deducting these expenditures in the return for the first taxable year for which such treatment is desired. The election applies to all properties of the taxpayer. Once the election is made all exploration expenditures, in the year of election and thereafter, must be deducted, unless the election is revoked with the prior consent of the Commissioner. The Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) made substantial changes in the treatment of exploration expenditures. For exploration expenses incurred after 1982 and before 1984 by a corporation, the amount currently deductible is limited to 85% of the expenditure. The remaining 15% must be capitalized and recovered over a five-year period. Although exploration costs capitalized under this provision are not part of the basis of the property for cost depletion purposes, investment credit may be claimed with respect to these expenditures. Further changes have been added by the Tax Reform Act of 1984 with respect to expenditures made after 1984. The Act reduces the amount of otherwise currently deductible costs from 85% to 80%. Additionally, it limits the availability of the investment credit for capitalized mineral exploration costs to deposits located in the United States. TEFRA also allows individuals a special method of recovery under which exploration expenditures may, at the election of the taxpayer, be amortized ratably over a 10-year period beginning with the year in which the costs are paid or incurred. If taxpayer does not use this method, the excess of the exploration expenditures actually deducted over the amount that would have been deducted if 10 year amortization had been elected is an item of tax preference subject to the alternative minimum tax.

Jan 1, 1985

By H. C. Carpenter

This literature study of methods for desulfurizing residual fuel oil was conducted by the Bureau of Mines at the request of the Department of Health, Education, and Welfare. The sulfur compounds in residual fuels are believed to consist chiefly of condensed thiophenes and other polycyclic sulfur compounds. Hydrodesulfurization appears to be the most promising method for desulfurizing these oils and is the only method applicable to all types of sulfur compounds. There are indications in the literature that hydrodesulfurization without hydrocracking of residual oils may require higher pressures than used in present desulfurization processes, but no cost data and little experimental data are available on the higher pressure operation. Literature proposals for hydrogenating residual oils and heavy crude oils are exclusively for hydrocracking the oils to lower boiling products with accompanying partial desulfurization of the residual fuel fraction. Costs of the hydrocracking operations appear the closest available to probable costs of hydrodesulfurizing the oils, and have been reported (in 1955 to 1957) as $500 to $840 investment cost per daily barrel of capacity, with total operating costs of 70 cents to $1.10 per barrel.

Jan 1, 1963

By H. C. Carpenter

This literature study of methods for desulfurizing residual fuel oil was conducted by the Bureau of Mines at the request of the Department of Health, Education, and Welfare. The sulfur compounds in residual fuels are believed to consist chiefly of condensed thiophenes and other polycyclic sulfur compounds. Hydrodesulfurization appears to be the most promising method for desulfurizing these oils and is the only method applicable to all types of sulfur compounds. There are indications in the literature that hydrodesulfurization without hydrocracking of residual oils may require higher pressures than used in present desulfurization processes, but no cost data and little experimental data are available on the higher pressure operation. Literature proposals for hydrogenating residual oils and heavy crude oils are exclusively for hydrocracking the oils to lower boiling products with accompanying partial desulfurization of the residual fuel fraction. Costs of the hydrocracking operations appear the closest available to probable costs of hydrodesulfurizing the oils, and have been reported (in 1955 to 1957) as $500 to $840 investment cost per daily barrel of capacity, with total operating costs of 70 cents to $1.10 per barrel.

Jan 1, 1963

By Grover R. Castle

INTRODUCTION "Project Financing" or "Project Loans" have become increasingly popular in recent years, and commercial banks are being asked to consider more and more of such financing. However, the analysis of this type of loan is quite different from the analysis of a loan to a financially sound corporation based on the company's balance sheet. For this reason Chemical Bank did a study of project loans in an attempt to be more sophisticated in our approach to them. As part of this study, we examined 29 project financings for which information was available. In this article I shall describe project loans and set forth the guidelines we developed, as an aid to credit officers who might have occasion to analyse this type of financing. DEFINITION OF "PROJECT FINANCING" OR "PROJECT LOAN" The terms "project financing" and "project loan" commonly describe the various methods that banks and institutional lenders use to finance the construction of new projects on a basis whereby payout is anticipated from the revenue stream generated by the project. A project financing often involves a loan to a new entity formed specifically to own the project. The analysis of a project loan proposal is quite different from the analysis of other term-loan proposals since it involves a credit decision based on the review of a projection or forecast rather than of historical earnings and/or it involves the reliance on contractual obligations of third parties. Lenders are asked to assume the added risks associated with project loans because: 1. Project financing may permit a company to obtain additional leverage. It is possible for companies to arrange financing on a project basis that could not be arranged as a direct borrowing. For example, a company may not be permitted to borrow more money directly, due to a limitation in a bond indenture. However, a project financing can sometimes be negotiated on a basis not prohibited by the indenture. 2. Often the sponsors of, or the stockholders in, the project are seeking an off-balance-sheet financing. For example, 11 of the 29 projects in our study were arranged on an off-balance-sheet basis and one showed on the balance sheet as a deferred income item. An off-balance-sheet financing, for the purpose of this article, is a financing which does not show as a direct liability on the balance sheet of the sponsors of or stockholders in a project. 3. Projects are often located in a foreign country. The financing is arranged so that the lenders assume the political risk on the loan because many companies rightly believe that this arrangement affords a degree of insulation from political risk not otherwise obtainable. 4. Many projects are jointly owned by several sponsors. This form of financing lends itself well to a situation where a new entity is formed to own a project and do the borrowing. Project loans can be used to finance a variety of activities including development of iron-ore deposits and associated pelletizing plants; development of coal reserves; construction of pipelines, alumina plants, fertilizer plants and refineries; etc. The specific areas of analysis can be quite different, depending upon the type of project being financed. It is important, therefore, to classify the proposal according to the type of project, and also by the nature of the financing - nonrecourse financing, financing covered by a guarantee of completion and financing supported by an undertaking lasting for the life of the financing. I will discuss each of these types in more detail later, but first, I should like to make some

Jan 1, 1985

By Henry O. Ash

On June 16, 1982, Rio Blanco submitted a request to the US Minerals Management Service for a suspension of operations under its federal oil shale lease. The company also wanted a five-year delay in the requirement for further minimum royalty payments and a five-year extension of the primary lease terms of 20 years. The request was granted in late July in the midst of yet another slump in oil shale activity. Rio Blanco holds one of four Federal oil shale leases that were granted under the Interior Department's Prototype Oil Shale Leasing Program in 1974. That year the DOI offered for lease six federal oil shale tracts, two each in Colorado, Utah, and Wyoming. The leases in Colorado and Utah were granted for substantial bo¬nus bids as shown in Table 1, but the Wyoming tracts had no takers. In the eight years hence, no oil shale has been produced commercially. Indeed, the prospects for successful oil shale development have fluctuated widely, continuing a 60-year- old cyclical pattern in the fledgling industry. The prototype program was developed and initiated while this infant industry struggled to begin anew, without the benefit of any federal oil shale leasing regulations, or any history of federal oil shale leasing at all. Permanent regulations were not required because the effort was limited and designed to provide the foundation for any future leasing program. Section 21 of the Mineral Leasing Act of 1920, a Nov. 30,1973 Federal Register notice, and the leases themselves constitute the legal and regulatory framework for leasing and developing prototype oil shale tracts. The prototype leases contain some unusual provisions including installment payments of the bonus bids, credit of early development costs against payments due the government, adjustment of royalty rates according to regional crude oil price fluctuations, and unusually extensive and detailed environmental stipulations. Several of the provisions were intended to provide incentives for early development and financial penalties for failure to develop. The requirement for minimum royalty payments in lieu of actual production royalties beginning in the sixth year of the lease falls in the latter category. After the sixth year, the required minimum payment is increased east year through the 15th year by an increment equal to that due in the sixth year. The minimum royalty then remains the same through the final five years of the primary lease term. Minimum royalty is calculates on a different production level for each prototype lease, based on the quantity of 125 L/t (30 gal/st) shale estimated to be recoverable from. each tract by room-and-pillar mining. That mining system was selected for reference as the only proven extraction method for oil shale at that time (early 1970s) The minimum royalty (production) rate was calculated for each tract by direct comparison of its estimated recoverable 125-L (30-gal) resource to a hypothetical tract containing 1.9 Gt (2.1 billion st) of recoverable 125-L (30-gal) shale. For the hypothetical lease tract, the minimum production for the sixth year was calculated to be 3.2 kt/d (3,500 stpd), increasing by a like amount each lease year through the 15th to a daily production rate of 31.7 kt (35,000 st). Under this formula, the hypothetical lease tract would yield $16 million in minimum royalty payments over the 20-year primary lease term if there were no production, no development credits taken, and no adjustment of the royalty rate due to fluctuation of regional crude oil prices. The production rate of 31.7 kt/d (35,000 stpd) was a somewhat arbitrary figure that was considered, in the early 1970s, to represent a minimum size for a commercial oil shale operation. A production rate of 7.9 dam3/d (50,000 bbls/day) soon supplanted that smaller mine production figure as a rule of thumb for the minimum size for a commercial facility. The proportional relation-

Jan 11, 1982

By J. D. Forrester

Many have been prone to credit the decline of professional interest in some branches of mineral industry education to the industrialists and other agencies who use our graduates. We hear the cry that industrial salaries are too low, opportunities for advancement do not exist, and the mineral industry specifically and generally is not interested in the engineer's efforts. Perhaps the time now has come when we should "dress-ranks," examine our practices, and publicize and encourage advanced technical training instead of laying all our troubles elsewhere. There can be no doubt but that industry is interested and stands ready and willing to co-operate. This is demonstrated by the numerous grants-in-aid and co-operative industrial projects which have been made available to those relatively few schools which have been encouraging graduate study and research. There is no dearth of research problems in any of the mineral industry fields and the sooner we realize the great opportunities for constructive, technical research in all areas of our profession the sooner we will reap the benefits of our engineering enterprises by closer liaison and broader understanding with industry. An analysis is offered here of the status of graduate work and research in various phases of mineral industry education in the United States. It is

Jan 1, 1949

By William J. Potter, Roger N. Pyle

Introduction The primary ingredient for survival of mining companies during a recessionary period is to be innovative and resourceful in the structuring and financing of operations. Over the past decade, many mining companies have had to retrench and restructure their operations and to redeploy their assets just to survive. During the same period, traditional sources of financing for mining companies -- commercial banks, subsidized export credit loans and long term straight debt financing in the public markets -- became less available and more expensive. Meanwhile, new markets and new financing instruments provided new alternatives for mining companies. Those companies which exploited these alternatives greatly enhanced their capacity for survival and even for profitability. This article considers the strategies adopted by some companies to adapt to changes in this recessionary environment; the inadequacy of traditional sources of financing; certain of the new financing instruments, structures and markets which have become available; and how several mining companies have utilized these new instruments, structures and financial markets to improve their competitive positions. THE IMPACT OF RECESSION ON MINING COMPANIES AND TRADITIONAL FINANCING SOURCES In its 1983 year-end article "The New Economic Order" Mining Journal characterized many of the large private sector mining companies with operations in the industrialized countries as being "gripped between the jaws of high working costs and stagnating metal commodity prices." The article went on to characterize the Canadian mining industry in particular as being "in the difficult position of having to seek to sell the bulk of its output in a world market characterized by over-capacity, where production costs were determined by internal political and economic factors while prices were set by external competitive forces of supply and demand." Miners of a wide range of commodities in the industrialized countries have come to realize that their domestic mineral resources are in many cases no longer competitive with global sources of supply. To compete and survive they would have to rely on their technical and financial expertise in mineral exploration and development and in mining and processing. Strategies For Survival Global competition has compelled management in the extractive industries to improve their worldwide cost position. This is the only means whereby a mining company can differentiate its product and attain a substantial competitive advantage. During the past decade, for example, ASARCO Inc. and Inco Ltd. chopped their payrolls, postponed expansion plans and otherwise retrenched. ASARCO reduced its capital expenditures and cash requirements for operations in 1984 to a level almost equal to its internally generated cash. The company's finances were also strengthened by increasing total lines of credit from outside sources, by selling common stock, and by reducing annual pension funding through a change in actuarial assumptions. Other companies returned to their traditional organizational structure where they had a demonstrated competitive strength. Consolidated Gold Fields, for instance, resumed its operation as a mining finance house. Its capital investment programs are now devoted solely to resource development. In mid-1984, at a time of firming zinc prices, Union Miniere S.A. used the opportunity to integrate its smelting capacity and to direct investment to certain subsidiaries at the expense of less viable operations. Smaller corporations realized that it was not enough just to be the low-cost producer. For example, Drummond Coal Company in Alabama, which dominates its regional market due to its low-costs, has also developed a world-wide trading capability and has placed incremental tonnage from its own mines as well as brokered coal produced by others, thereby minimizing capital risk. In Canada, Campbell Resources has exploited difficult times by acquiring assets cheaply. In the process it improved its capacity to withstand cyclical economic swings by diversifying from solely a copper and gold producer to a company based upon asbestos, coal, copper, gold and natural gas.

Jan 1, 1985

By John T. Ryan

FOR the first ten months of 1942, on which data are available at the time this is written, the coal-mining industry achieved a most creditable safety record, and ha1 figures for the year may show a record surpassing that of 1941 in which the industry reached the best accident rate in its history. The ten- month accident rate for both bituminous and anthracite mining in 1942 was 2.197 fatalities per million tons of coal mined, compared with a revised rate of 2.271 for the same months of 1941. The bituminous rate decreased from 2.139 in 1941 to 2.039 for ten months of this year, and the anthracite rate shows a reduction from 3.707 to 3.699 for the same period.

Jan 1, 1943