Search Documents

By K. A. Natarajan, S. C. Riemer, I. Iwasaki

The relative significance of corrosive and erosive wear in magnetic taconite grinding is examined. The influence of different types of aeration (nitrogen, air, and oxygen) on ball wear was established for mild steel and high carbon low alloy steel balls. Ball wear data from dry and wet grinding tests are compared with those obtained in the presence of an organic solvent that does not promote electrochemical corrosion. Marked ball grinding tests and electrochemical measurements involving ball material and magnetite electrodes indicate that contribution from oxygen toward wear (corrosive wear) is relatively small, and abrasive wear appears to be significant. Rheological properties of the slurry appear to have an important bearing on the abrasive wear of grinding balls.

Jan 1, 1985

By Alistair Frame

INTRODUCTION In April 1988 discussions were about to start with BP on the possibility of buying their- mineral interests, and it took a long time to arrange a deal. I will talk about RTZ without BP Minerals, look at the new RTZ with BP Minerals, discuss the outlook for metal prices, and review the problems in South Africa and develop the case against sanctions on that country. RTZAT THE END OF 1988 Late in 1987, after completing a worldwide review of our strategic thrust, we decided: 1. That the business focus would be to remain a major diversified natural resource group with interests in related industries. 2. To divest non-core and low growth businesses. 3. To develop a logical acquisition plan. 4. To emphasise organic growth and, most importantly, to enhance shareholders' wealth by capital increase and a progressive dividend policy. Subsequently, we concluded that we should sell our oil and gas business and dispose of several assets for which we saw little growth potential. The disposal programme raised some U.S.$ 1,600 million, representing a significant capital gain on our various investments. All transactions were carried out by our small Head Office staff in London, without the help of merchant banks and lawyers, and we were able to safeguard the employment of our staff in all these operations. The most interesting disposal was of our oil and gas interests. Before the 1987 strategic review, we had ambitions to develop our oil and gas interests and to become the leader in the second division of European oil companies. Our interests, which were purely in exploration and production of oil and gas, consisted of the 100% owned RTZ Oil and Gas company, and 29% of LASMO, a publicly quoted U.K. oil and gas company with extensive worldwide interests. LASMO, in turn, owned 25% of Enterprise Oil, one of the more successful of the North Sea oil exploration and production companies. Prior to the end of 1987, our intention was to acquire control of both LASMO and Enterprise. However, when we evaluated the net asset value of these two companies based on our oil price assumptions, which were pessimistic for the next five years or so, we concluded that they were both trading in the market at significant premiums. This, taken with the additional premium required for acquisition and the high cost of exploration, led us to conclude that, since funds could undoubtedly be used to better effect, we should sell our interests. Turning to the other major achievements in 1988, we commissioned, and built up to design levels in a very short period of time, the Morro do Ouro gold mine in Brazil. This mine reached its design output of 100,000 ounces of gold per year within three months of start-up, which was on time and under budget. We are now considering a possible expansion of this property. In South America, Utah International, Mitsubishi and RTZ arranged non-recourse finance, with post completion guarantees, for the giant Escondida Project in Northern Chile. Financing came from a group of banks in Japan, Germany and Finland -- the countries to which most of the concentrates will be sold -- and from the LEC. The average output of the mine for the

Jan 1, 1990

By Rush Greenslade

The oil and gas lease is the basic contract of the oil and gas industry; it is the foundation stone upon which the producing industry, particularly, is based. As the industry is precarious and highly speculative, the foundation contract should be of the utmost integrity and certainty. But right there an anomaly exists; the oil and gas lease is the most obscure, most uncertain, doubtful contract in the realm of law today. That is a condition that must be considered when taking oil and gas leases, and when buying, selling, and holding them. It may fairly be asked why should this industry rest upon so insecure a foundation. Why should not the oil industry rest upon the contract that is the basis of all industry, the warranty deed? There are many contributing reasons, but the principal one is business expediency. The Anglo-Saxon idea of ownership of land is that every land owner owns from the center of the earth to the sky—all that is above and all that is below—consequently the oil and gas are owned by the person who owns the surface. That idea is not exactly true with reference to oil and gas, for many states have adopted the doctrine that oil and gas are like wild animals; they are fugacious and migratory and belong to the man that traps them. But, except for that doctrine, we believe that oil and gas are owned by the owner of the surface, wherein we differ from the Latin-American countries where the mineral rights are owned by the government. The United States was settled largely by homesteading. The owners of land were, in the main, farmers, who did not have the means or the faith to drill for oil or gas. The operators or speculators did not want to buy the land on the mere possibility of finding oil; hence a compromise resulted by which the land owner gave the speculator or the operator what he called an oil and gas lease, or a right to go upon his land and drill for oil and gas. What is supposed to be the first oil lease placed on record reads as follows: Agreed this 4th day of July, a.d. 1853, with J. D. Angier of Cherrytree township in the county of Venango Pennsylvania that he shall repair up and keep in order the old oil springs on land in said Cherrytree township, or dig and make new springs, and the expense to be deducted out of the proceeds of the oil, and the balance, if any, to be

Jan 1, 1924

By H. W. Gillett

MAINTENANCE of membership by the technical so¬cieties and the activity of these societies in spite of the adverse business situation have been noteworthy. This forcibly brings home the fact that industry recognizes that sound technical guidance is well worth its cost. The numerous difficulties and losses due to defects of various kinds arising from gas-metal reactions are now generally recognized and interest in these problems is widespread. The forthcoming A. I. M. E. round-table discussion of gas-metal problems will do much to clarify the situation and will permit us to assay our present knowledge and to suggest the proper direction for profitable future research. "The Age Hardening of Metal" was the title of the annual I. M. D. lecture delivered by Dr. Paul D. Merica. A critical review of the known facts relating to age-hardening phenomena was first given, followed by the presentation of a theory correlating the detailed observations which have been made regarding the mechanism of the hardening.

Jan 1, 1933

By M. E. Grimes

A method of predicting uranium extraction rate in underground bacterial leaching of as-blasted ore has been developed. The method is based on the hypothesis that extraction is directly proportional to the volume of a piece of ore that is penetrated by the leaching agent, and that each piece of ore, regardless of size, has been penetrated radially from the external surface to the same depth at a given leaching time. Consequently, given an initial size and assay distribution, extraction should be predictable for a given penetration. Two laboratory bacterial leaching tests under simulated stope leaching conditions were carried out for a periods of 89 and 96 weeks. On completion, the residual ore was screened and analyzed. The information so obtained was employed to provide an elapsed time base for the penetration model, from which predictions of future extraction were made. The finding of solubilized uranium trapped within apparently sol id ore pieces was unexpected. However, it is not recoverable except after crushing, and hence does not affect calculations of underground leaching .

Jan 1, 1974

By AIME AIME

As already announced in the January Bulletin, this publication will be issued during the coming year monthly instead of bi-monthly as heretofore. Among other reasons for this change, it is desired to effect thereby the earlier transmission to members of important papers, lists of candidates for membership, and other items of timely information. Spokane Meeting and Excursions. Further details of the 97th meeting of the Institute have been sent to members in the Circular of May 8, 1909. The list of those intending to go on the excursion is filling up, and since preference in position of state-room or berth is given in the order of application, members and guests who expect to accompany the party and have not yet communicated with Mr.. Theodore Dwight, 29 West 39th St., New York, N. Y., are earnestly requested to do so without delay. For convenience of the members a summary of the additional information is here presented. A special train of Pullman cars will leave Chicago about September 15. This train will be side-tracked at all places visited, and the sleepers will be available for lodging and the dining-car for meals during the entire trip, except during the Yellowstone Park tour. The general cost of the trip per member will be $300, which includes transportation, berth, and meals for the entire trip from Chicago back to Chicago, almost 6,000 miles, and the tour through. Yellowstone Park, occupying in all about 30 days. Special, accommodations on the train will be furnished at the following rates

Jun 1, 1909

By E. J. Duggan

CLIMAX ore is an altered and highly silicified granite, about half of the gangue being quartz. Molybdenite is the only mineral recovered and most of it is intimately associated with the quartz in fine veinlets. Other minerals are molybdite, pyrite, and chalcopyrite. Although the molybdite may be readily extracted by hydrometallurgical methods, its content is too low to make this profitable. The pyrite ranges from 2 to 5 per cent and the chalcopyrite from 0.03 to 0.05 per cent. There is not enough copper to make its recovery attractive and one of the problems is its elimination, and that of pyrite iron, from the final product. On account of the high degree of dissemination of the molybdenite and the necessity of eliminating the iron and copper, fine-grinding followed by flotation is the only known feasible method of concentration. Two factors, peculiar to Climax ore, have a predominating influence on the metallurgical attack: (1) Molybdenite is one of the most easily floated minerals. High recoveries may be made with pine oil alone if the

Jan 1, 1946

By C. R. Kuzell

IN COMPARISON with recent years 1932 has yielded much less tangible evidence of progress in copper reduction and refining. The industry has been extremely quiet, especially in the United States. Design and construction has been throttled by lack of new capital expenditures. The excess producing capacity of the whole industry and the extremely gloomy outlook for the future have made it unwise to tie up more capital except under special conditions. The plants built during the previous year have, however, been placed in operation. Older plants have been abandoned, temporarily shut down, placed on part time operating basis, or continue to operate at a low percentage of normal capacity. In the United States the Phelps Dodge Corporation at Douglas, Ariz., has completed the remodeling of the former Calumet & Arizona smelter. A new roaster and Cottrell plant chimney was completed this year. Though operations have been limited the new equipment has been found to justify all expectations. The reverberatory plant addition consists of two furnaces 26 by 107 ft. inside dimensions, with a high arch, and modern steel binding of excellent design. Natural gas fuel gives good results. One of these furnaces will treat 1000 tons of solid charge per day with a fuel consumption of approximately 3,000,000 B.t.u. per ton. The larger converters have not only yielded the expected lower costs, but have simplified operations in the converter department. One of the noticeable results is the greater cleanliness in the environment and the absence

Jan 1, 1933

Industrial minerals enjoyed a fairly successful year in 1978, despite the sluggish economy, inflation, and environmental restrictions. A glance at US Bureau of Mines statistics shows that, in general, production of industrial minerals increased from + 1% (salt) to as much as 26% (sulfur, other than Frasch or recovered). A few industrial minerals showed a decline; fluorspar production, for example, registered a 23% decrease in 1978 from 1977 due to the closing of three domestic mines. Bromine, natural sodium sulfate, Frasch sulfur, and vermiculite also had production decreases of 2-6% in 1978.

Jan 5, 1979

By M. H. HARRINOTON

THE Transactions of the Institute afford abundant evidence of the general recognition by mining engineers of the importance of a safety-lamp which will not only give warning of the presence of fire-damp, but will also indicate the proportion in which it is present.' Mining-men are only too familiar with the frequent and sudden changes that constantly occur at the working-face of a gaseous mine. Nothing illustrates more forcibly the pregnant condition of the strata enfolding the seam and the seam itself, than the fact that a circulation of perhaps 150,000 cu. ft. of air may contain 2 or even 3 per cent. of marsh-gas, representing a volume of from 3,000 to 4,000 cu. ft. of this gas pouring-out each minute from the natural strata into the mine-workings. It would, indeed, be strange if this great outflow of gas were always constant, and it creates no surprise that such earth-breathings, as they may be called, are spasmodic and irregular in their wane and flow. There are other causes that act to vary the gaseous condition of mine-air. Gas has a tendency, often very manifest in mine-workings and airways, to stratify and, at times, to travel long distances in veins or streams. It is common to catch and lose the gas in the lamp when making a test. At times two lamps, held side by side in an air current, will indicate different gaseous conditions of the passing air. When testing for gas, the lamp may suddenly fill with flame, in a mine-chamber, where a moment before a careful test showed the presence of but 1 per cent. of gas. It is sometimes remarked that there is little need of detecting a smaller percentage of gas than is revealed by the common

Jan 1, 1906

By W. M. Ross

AMONG the comparatively few A radical changes in mining equipment in recent years is the introduction and use to an ever greater degree of detachable bits for rock drills. Just how great the possible field for economic application of this innovation is, and to what ex- tent detachable bits are used instead of the conventional type of drill steel, are matters of conjecture. Just as a rough approximation, one might conceive that at least three-quarters of the drilling done in mines today could better be performed by steel with detachable bits, instead of only about one-quarter as at present.

Jan 1, 1939

Organization Place Date 1919 American Chemical Society Philadelphia, Pa. Sept. 2-6 National Assn. of Stationary Engineers Huntington, W. Va. Sept. 8 American Peat Society Minneapolis, Minn. Sept. 22-24 American Iron, Steel Electrical Engineers St. Louis, Mo. Sept. 22-26 American Institute of Min. and Met. Engineers. Chicago, Ill. Sept. 22-27 American Steel Treaters' Society, First Annual Convention Chicago, 111. Sept. 22-27 National Exposition of Chemical Industries.... Chicago, Ill. Sept. 22-27 National Safety Council Cleveland, O. Sept. 29-Oct: 2 American Foundrymen's Association Philadelphia, Pa. Sept. 29-Oct. 4

Jan 9, 1919

By WILLETT G. MILLERS

GENERAL RECEPTION COMMITTEE.-Willett G. Miller, Chairman; F. G. B. Alan, Hon. Frank Cochrane, Eugene Coste, Thomas W. Gibson, Cyril W. Knight, J. C. Murray, 0. N. Scott, Alan Sullivan, J. B. Tyrrell, J. W. Wells, A. B. Willis. COBALT RECEPTION COMMITTEE.-Arthur A. Cole, Chairman; Will. Ask with, R. W. Brigstocke, Robt. Bryce, Fred Coombs, M. I. Culbert, I. R. Drummond, J. W. Evans, A. Ferland, F. N. Flynn, E. L. Fraleck, S. R. Heakes, Joseph Houston, D. L. Jemmett, I. R. Jones, Major Leckie, Capt. Jack Leckie, R. W. Leonard, W. H. Linney, Alexander Longwell, Frank Loring, Murdock McLeod, John Martin, D. B. Rochester, W. E. Running. COBALT RECEPTION COMMITTEE (Ladies).-Mrs. A. A. Cole, Mrs. A. Edwards, Mrs. R. Jennings, Mrs. S. H. Logan, Mrs. A. Longwell, Mrs. H. F. Marsh, Mrs. J. Smith. SUDBURY LOCAL COMMITTEE.-Mayor L. O'Connor, Chairman; S. Fournier, Secretary; A. H. Beath, W. J. Bell, F. B. Bennett, D. M. Brodie, J. S. Buchanan, F. C. Busby, Wm. Chalmers, R. Dorsett, W. A. Evans, John Frawley, J. S. Gill, A. B. Gordon, J. G. Henry, T. N. Kilpatrick, Major Leckie, Chas. McCrea, John McLeod, Wm. McVittie, R. Martin, R. S. Mitchell, J. H. Morin, J. A. Orr, James Purvis (President Board of Trade), C. R. Reid, Major Smith, W. W. Stull, J. F. Templeton, S. E. Wright. The first session, held in the Banquet Hall of the King Edward Hotel, was called to order Tuesday, July 23, 1907, at 2.30 p.m., President John Hays Hammond presiding. Prof. Willett G. Miller, chairman of the General Committee, introduced Alderman J. J. Graham, who, in behalf of the City of Toronto, extended a hearty welcome to the members and guests of the Institute. To this welcome, President Hammond replied in a few well-chosen and hearty remarks. In the hall in which the session was held there was exhibited a fine, full-length, life-size portrait of Dr. Rossiter W. Raymond, in 1871 Vice-President and acting President, in 1872, 1873 and 1874 the elected President, in 1876 and 1877 Vice-President, in 1883, by appointment of the Council, and for the last 24 years by annual election, Secretary, of the Institute. Dr. James Douglas, of New York, N. Y., on behalf of numer-

Sep 1, 1907

Discussion, at the Virginia Beach Meeting, February, 1894, of the Paper of Prof. Posepny. (Trans., xxiii., 197, 587.) Including communications subsequently received. a T. A. Rickard, Denver, Colorado (communication to the Secretary) : The paper of Professor Posepny was printed so short a time

Jan 1, 1895

By Jim F. Lemons

INTRODUCTION A nickel doesn't buy much anymore. That's even true in the cost of recovering nickel -- the commodity. A 5[C] per pound (11 [c] per kilogram) increase in the nickel price won't cover a 10-percent increase in fuel costs for processing laterite ores, nor will it cover a 10- percent increase in wages for recovering nickel from a sulphide ore. It won't even cover a 5- percent increase in the capital cost necessary to mine and process ocean nodules. The basis for this statement and a quantitative analysis of the variations in costs to recover nickel from different types of nickel ores will be discussed in this paper. During the early part of the 1970's, the interest in nickel and its potential development was shifting from Canada to the Pacific Basin area. Canadian growth rate was slowing and each additional increase in nickel capacity was very expensive (Argall, G.O., 1970). Laterite ores were attractive to developers since they were easy to mine at a low labor cost, and technologies were being developed that would allow the recovery of nickel in marketable forms (Mohide, T.P., Warden, C.L., Mason, J.D., 1977). During the last decade, new laterite production was achieved in the Philippines and Botswana, and a significant increase in production from Indonesia and New Caledonia occurred. However, recent reports on nickel identify numerous problems plaguing the industry, i.e., high energy costs that are forcing shutdowns (INCO, 1980), (Mohide, T.P., Warden, C.L., Mason, J.D., 1977), high Canadian sulphide mining labor costs (Anon., 1976), and rapid inflation of nickel capital costs (Anon., 1981b). No definitive study has been made to determine how sensitive the total cost of production is to rising energy, labor, or capital costs, or to identify to what extent increased byproduct revenues could be used to offset these production costs. The purpose of this paper is to quantify the effects of increases in energy, labor, capital costs, and by-product credits on the future cost of production from nickel reserves and/or resources. METHODOLOGY OF ANALYSIS In order to evaluate the sensitivity of nickel production costs to changes in energy, labor, and capital costs, and in byproduct revenues, an analysis was made of existing and proposed nickel operations, their costs, and their sensitivity to change. The data for these analyses were obtained from numerous sources including international govern¬ment and university publications, professional journals, company reports, private communications, U.S. Bureau of Mines contracts, and estimates by Bureau of Mines personnel. These data were collected, in part, as an ongoing effort of the U.S. Bureau of Mines Minerals Availability System (MAS) to systematically measure and classify identified mineral resources according to their respective extraction technologies, economics, and commercial availability. The MAS Program is currently evaluating the present and potential availability of nickel to the United States in relation to mining, beneficiation, smelting, refining, leaching, transportation, infrastructure, environment, land use, labor, productivity, technology efficiencies, operating capacities, deposit life, and political factors. As a summary of this data, the following briefly describes nickel ore types as each relates to energy, labor, capital, and byproducts. Sulphide Operations Nickel is currently available from sulphide deposits. Roughly 55 percent of the current world nickel production in market economy countries is from sulphide ores, although only about 20 percent of the known land-based nickel reserves and/or resources are sulphides (INCO, 1981). In 1979, the Western World sulphide reserves were estimated at about 9.2 million metric tons of nickel (Little, A.D., 1979). Sulphide ores are typically mined underground, thus resulting in high mining costs; however, these ores can often be upgraded by flotation prior to final nickel recovery and require about one-third of the energy required to recover nickel from laterites (Anon., 1981c). In addition, nickel in sulphide ores may be associated with economically recoverable byproducts, which include copper, cobalt, gold, silver, and other precious metals. Laterite Operations Forty-five percent of current nickel production is from laterite deposits. Laterite deposits account for 80 percent of the known land-based nickel reserves and/or resources (INCO, 1981). In 1979, the Western World laterite reserves were estimated at over 35 million metric tons of nickel (Little, A.D., 1979). Nickeliferrous laterites are residual soils formed by weathering, typically under tropical or near tropical conditions. They can be easily mined by open-cut methods, but generally cannot be beneficiated; thus, recovery of nickel must entail processing of the total mined ore. Usually, these ores have high moisture content (20 to 30 percent by weight) that result in additional fuel costs to dry the ore. Nickel silicates, garnierites, are, processed by pyrometallurgical methods; limonite nickel oxides are normally leached. Byproduct cobalt is not recovered from most ferronickel operations, and is only recovered to a limited extent from many leach operations.

Jan 1, 1982

By B. C. Craft

Oil and gas development in Mississippi during the year 1933 was rather active and a number of important wildcat wells were drilled throughout the state. Mississippi showed an increase in drilling operations during 1933. There were 58 completions from 22 counties during this period, compared with 53 completions in 10 counties during 1932. The Jackson gas field in Hinds and Rankin counties continued to be the most active area with 26 completions, resulting in 17 gas wells, 2 oil wells, and 7 dry holes, compared with 38 gas wells, 1 oil well and 5 dry holes during 1932. A further attempt to extend the producing limits of the Amory gas field resulted in a dry hole. Extensive exploration in south Mississippi has proved the existence of ample source beds and presence of an extensive sandbody near the top of Cockfield. Core tests, supplemented by extensive geophysical work, have been carried on in Jackson, George, Harrison, Pearl River and Stone counties. Exploration will be continued in 1934. The most important deep test drilled in 1933, and the deepest well ever drilled in a southeastern state, was the Eastman Gardner et al., Bank of Seminary No. 1, sec. 26-8N.-15W., Covington County. This well went through about 1300 ft. of Selma chalk, and was abandoned in the Eutaw at 8004 ft. Another interesting operation during the past year was the Foster Creek Oil Corporation's Foster Creek Lumber Co. No. 1, sec. 14-2N.-2W., in the "Eastern Conroe Trend." This test is shut down at 3687 ft. in the Catahoula sandstone and has not encountered any important shows of oil or gas. A total of 107 of the 117 gas wells completed in the Jackson gas field since its discovery in 1930 are still producing, and have a combined open flow of approximately 3,724,896,000 cu. ft. It is reasonable to assume that this area will be rather inactive during 1934 as the maximum daily production during 1933 was 3,476,000 cu. ft. The 10 wells that have gone dead were edge wells. The water level is now between the sub-sea depths of 2190 and 2195 ft. The Gulf Refining Company's Rainey No. 1, sec. 13-5N.-lE., one of the early wells in the field, had gas and water at —2225 ft. That the field is under hydraulic control is

Jan 1, 1934

By Granville S. Borden

MANY complaints have been filed by mine prospectors, explorers and producers about inequities in mining taxation. They have insisted upon improvement, and in the past 35 years there has been some progress. Many of the best taxation provisions made to date are those contained in the Revenue Act of 1951. Mining economics presents special problems, a fact even recognized by many textbooks. Certain provisions have been made to take care of mining taxation rights, but these have been made by Congressional act and do not represent basic, constitutional, guarantees. Despite special provision, in the form of depletion allowances, there remain injustices. The industry faces the problem of gaining adequate income tax allowances for exploration and development expenditures, operating losses, and bonus and subsidy payments. Problems in mine taxation arose soon after the adoption of the 16th Amendment. This amendment gave Congress the power to impose income taxes. Supreme Court decisions against a number of mining companies held that Congress, under its power to tax income, could tax net operating revenue before depletion allowance was deducted. The court also ruled that the right to deduct depletion is a matter of Congressional permission. There is no statute provision permitting mining stockholders to recover their investment out of dividends while the mine is being operated. The Supreme Court did not recognize that part of mining proceeds are actually amortization of the cost of mineral rights. Both these omissions stem from failure to recognize that by its very nature mining consumes its mineral rights and therefore that a part of gross proceeds are not income but recovery of capital. Suppose a Congress unfriendly to mining interests repeals the provisions that allow deductions for depletion. Under such a situation assume that a corporation buys a mineral deposit for $300,000. They mine the deposit and earn an operating profit of $500,000. At the current rates they would pay a Federal Income tax of in excess of $250,000. This venture results in a loss of $50,000 as shown in the table below. For the example given the absence of depletion provisions in income tax law would turn ore into waste rock, because the word "ore" connotes commercially mineable rock. [ ] In retrospect the conclusion is clear: If the Supreme Court had recognized that a part of mining proceeds represent in reality sales proceeds of mineral rights, then profits derived from such sales would have been taxed at the favorable long-term capital rates, instead of being taxed at the high normal, surtax and excess profits rates. It is a question whether percentage depletion allowances offset this tax situation. History The history of depletion allowances has been one of general improvement. The original act did not include depletion, but an allowance at the rate of 5 pct of gross proceeds was provided in 1913. The Acts of 1916 and 1917 allowed depletion upon cost of property, and in 1918 the law was further changed to permit depletion upon cost, or market value as of date of discovery. In 1932 metal, coal and sulphur properties were permitted to elect depletion in percentages of gross income, limited to 50 pct of net income, in lieu of cost depletion. Shortly thereafter the rule was changed and percentage depletion is now allowable in any case where it is higher than cost depletion. Since 1942 percentage depletion allowances have been extended to cover many nonmetals, and in 1951 the rate for coal mines was increased from 5 to 10 pct of gross income. It is interesting to note that these allowances have been retained, and even

Jan 1, 1952

By George W. Friesen

This paper presents the historical trend and de- fines the causes of drilling cost escalation in the Gulf of Mexico during the 1970's. The three major components of escalation are: 1) inflation, 2) supply-demand imbalance (demand pull) and 3) decreases in drilling efficiency. The decade was divided into three periods. During each period one component of escalation was responsible for most of the rise in costs. From 1970 through 1973 only inflation pushed costs upward. During 1974 and 1975 a supply- demand imbalance caused most of the escalation. Since 1975, decreases in drilling efficiency have produced the major component of escalation. During any one year or period of years, the sum of the three components will give the total escalation rate. The reasons why different components contribute more toward escalation during certain years than others are shown by following the timing of oil and gas price increases, the overall quality of the acreage offered each year in offshore lease sales and the resulting drilling activity.

Jan 1, 1982

By James Terry Duce

The gross production on the Island of Sahreirl during 1944 was approximately 6,700,000 U. S. bbl. No additional wells were drilled in the field during the year, but a number that were plugged off during the critical days of the war were brought back on production. This work is continuing. The construction of the extension of the refining plant was continued during the year and the new crude still was started in November. In Arabia, the production for the year 1940 was 5,074,838 U. S. bbl. Four wells were completed in Dammam field and all were commercial producers. Production for 1941 was 4,310,110 U. S. bbl. Seven more commercial producing wells were completed in Dammam field, and Well No. I at Abqaiq was complcted at 6180 ft. and was also a commercial producer. In 1942 production was 4,530,492 U. S. bbl. Abqaiq No. 2 was drilled to 5785 ft. but was left standing because of mechanical difficulty. The 1943 production was 4,868,- 184 with one well drilled, Abqaiq No. 3 completed at 6488 ft. and a commercial producer. Total production in Arabia for the year 1944 was around 7,800,000 U. S. bbl. and at the close of the year was running at approximately 40,000 bbl. per day. The small refinery, built in 1939, at Ras Tanura was in operation in the fall and a new refinery is being constructed. Only three wells were completed during the year—the El Jauf well in Northern Arabia (completed at 10,974 ft.) which did not bring in commercial production and Wells No. 4 (completed at 6270 ft.) and No. 5 at Abqaiq (completed at 6751 ft.), which were brought in as substantial commercial producers. Production for the year was entirely from the Dammam field. In this field, some of the wells that had been plugged off early in the war were brought back in production and this work is continuing. At the close of the year, one well was drilling in the Abqaiq field and an additional well was drilling at Qatif, the latter being a wildcat. Neither of the wells in question had reached producing horizons on the first of January.

Jan 1, 1945

By Harry P. Hohenadel

DURING the past few years the amazing developments of the chemical industry have inspired so much publicity that the feature writers assure us that we are entering a "Chemical Age," industrially as important as the "Steel Age" and the "Electric Age," so-called. Whether or not these assurances are overstatements, it is a fact that the expansion of the chemical industry during the past 25 years has been enormous. The Chemical Bureau of the War Production Board calculates the value of chemicals produced during 1944 at $8,300,000,000, no small sum even in inflated dollars. As concerns us of the Southwest oil and gas country, four significant trends of the chemical industry are most important. (1) Many of the recently developed chemical products are new creations, not substitutes,. as new and original as the invention of the light bulb, and with a field for exploitation almost as wide. (2) Many of these chemical products will enter the mass consuming markets, which require enormous tonnages of products, and such markets are setting up an industrial demand for chemicals on a mass volume basis, compared to the relatively high-priced low-volume basis ordinarily considered as the chemical outlet of the past. (3) Most of the processes involved in producing these chemicals are adapt. able to the use, all or in part, of natural gas, oil, or refinery gases as raw mate-

Jan 1, 1945