Geology is not the problem.
Because of inflation, taxation,
and politics~morereserves are being reconverted to
uneconomic resources than there are new reserves created
by exploration and extraction technology.
The Problems of Converting Resources
to Reserves
Paul A. Bailly, Occidental Minerals Corp.
Assessments of future raw materials supply have been
published by the dozens in the last few years. They have
varied from prediction of imminent d u e shortages to state-
ments that "even without technological improvement, the
world is not likely to be threatened with a physical short-
age of raw materials until about the year 100,000,000
A.D." When one analyzes all these forecasts, one can come
to the conclusion that each may be correct. The variations
depend entirely on different assessments of mineral avail-
ability measured with different geologic, technological,
economic, and political parameters.
Resource Semantic
To most of us, a resource is a thing, a person, or an ac-
tion which we can turn to, in time of need or emergency.
To most mineral appraisers, however, the same word indi-
cates naturally-occurring mineral concentrations in such
form that economic extraction is currently or potentially
feasible. In this context, the term "resource" refers to both
a known economic mineral concentration, i.e., a "reserve,"
and an undiscovered deposit of unknown economics. But
the common man's concept of resource, when it comes to
minerals, includes only "reserves"; it does not include un-
discovered deposits. Reserves are concentrations of a us-
able mineral, or energy commodity, which can be eco-
nomically and legally extracted at the time of determina-
tion. Reserves are truly ready for use and can be drawn
upon to take care of a need or an emergency; undiscov-
ered deposits are not available for use.
These different meanings of the word "resource" explain
why apparently contradictory statements about future sup-
ply of raw materials can all be correct. In this presentation,
when I refer to a "resource," I mean any thing, any per-
son, any action which can be used to take care of a need.
However, when it c0me.s to mineral resources and mineral
reserves, 1 use the definitions of the US Geological Survey
and the Bureau of Mines.
Mineral-Materials Resource Base
Table 1 classifies all components of our mineral mate-
rials resource base. Immediately and economically avail-
able mineral materials ir~clude(from the center leftward) :
exploitable demonstrated reserves; products recently pro-
duced and available in the market; products in inventory,
or in long-term stockpiles; and economically recoverable
scrap.
There are three main conversion routes available for
transforming uneconomic and/or undiscovered mineral re-
sources to usable reserves: First, mining and metallurgical
extraction technology research can result in inventions and
MINING ENGINEERS
developments that make demonstrated conditional re-
sources economical. Second, used materials and products
can be converted into usable products through recycling
technology research that results in economical processes.
Third, undiscovered mineral resources, whose existence
and economics must be demonstrated through discovery
and feasibility studies; the conversion process is mineral
exploration.
Undiscovered mineral resources include inferred min-
eral resources in close proximity to known deposits; hypo-
thetical mineral resources within known districts; and
purely speculative mineral resources in areas not known
to be mineralized.
Forecasters who limit their investigations to existing
scrap, mineral reserves, and mineral products can predict
shortages for many commodities; other forecasters who
do not conceive of any great technological or economic
difficulty in using common rock such as granite and basalt,
and seawater, as a source base, can comfortably predict
that there won't be any physical shortages of raw mate-
rials until the year 100,000,000 A.D.
I will first discuss the conversion of undiscovered non-
energy mineral resources to mineral reserves through ex-
ploration resulting in mineral discoveries, and then ex-
amine some aspects of economic and political availability
affecting the main metal commodities. I will conclude with
a few comments on the potential supply of metals from
the deep oceans.
What's Needed For Conversion
What are the main requirements for successful conver-
sion of resources to reserves?
The first absolute requirement is high-quality human
resources-individuals actively dedicated to discovery and
fully acquainted with the nature, uses, availability, and
limitations of all the other resources. The key to successful
ex~lorationis the aualitv of human resources.
I I
~ - -
The next resource is land. It contains the deposits to be
discovered. But land is worthless unless both surface and
subsurface are accessible for exploration and legally avail-
able for development and operations, in case of discovery.
Obviously, any exploration project must be based on a
hypothesis that mineral reserves may be found in the area
under investigation. Essential components of such target
hypotheses are the mineral-resource appraisals prepared
by mineral scientists in industry and government. Mineral
endowment evaluation, however, is a new discipline in
growing demand for policy determination and for explora-
tion planning. Like geology and exploration, it is both an
art and a sclence. Most mineral-resource appraisals inte-
MINING ENGINEERING 27
 Table 1-Mineral-Materials
Consumable
Waste Products
Sales M w u m and
Inventory Indicated
Stockpile Reserves
%
-------- - -- -- - -
"FIecycIables"
8 MunPoipal Conditional
wa*eA Stockpilr Subeconomic
g Resources Resources
-.
3 >
- - - ----------- -----_
"Common Rock"
Sea Water
Granite
Basalt
Modified After W. Pratt
D. Brobst, 1973
grate two components: an extrapolation of all known re-
sults of pre\.ious mineral production and mineral explora-
tion activity, ant1 a theoretical estimatioll of minerals in
existence in the ground. Both are very hazardous fields.
After all, reserves can be inventoried, but undiscovered
resources callnot; they can only be guessed at. To a large
extent, the guesses depend on subjective experiencc and
judgment and are subject to constant upgrading. Any such
appraisal is ill a constant dynamic state of flux, changing
with geological knowledge and econoniic coliditions.
There are no once-and-for-all resource estimates.
We call usc three main methodologies in estimating
undiscovered resources: ( 1) the elemental distribution up-
praisal; ( 2 ) the mineral distribution appraisal; and, (3)
the geological distribution appraisal. The first two have
some application in studies of large areas for policy de-
termination. But since they rest oil mathematical formula-
tions of current k ~ ~ o w l e d gabout
e the distrib~itioliof chem-
ical elements (such as metals and nonmetals) or of the dis-
tribution of s~ec'fic
I
minerals such as nickel silicates or
copper sulfides, the first two methods provide quilntitative
statements tliat have no immediate application ill deciding
\vhether a speciIic area is worthy of exploratioll or 11ot.
For the purpose of esploratioll planning, the only ap-
praisal ~rlc>thotlo!ogj.of \ d u e is geological appraisal; it
evaluates the fa\-orable characteristics of areas for the oc-
cul-rence of specilic types of deposits ant1 shoultl be prc-
ferably expressed it1 quantitative probabilistic ternls. This
discover: -orlcnted approach is essentially that usccl by the
US Geolopical Survcv in its recent ~ublications.Thc de-
gree of .~ccur,~cy i ) f such appraisals 2ecreases markedly as
we progl-c.,s fro111 appraisals of inferred rcscr\,es in the
immedia~c\ i c i l ~ i ~ofy know11 exploitable tleposits, then to
evaluation of possible discoveries in large areas or districts
where some r~iineraldeposits are known to occr~~.; fillally,
the accuracy is cxtrcmely poor when \ve appraisc large
areas where some favorable characteristics are known to
exist, but \\here 110 deposits of the type sought is yet
known to exist. \Vc, should remind ourselves that most
"provel~" mineral reserves of metals are known, at best,
withill a plu.; or nlinus mO(; margin of error, arld that in-
creasingly larger n ~ a r g i l ~ofs error must 11e ;~ssiglledin this
order to illfcl-red, l~ypothetical,and speculative ~rrineral
resources. Sul~jectivegeologic appraisals are more valuable
tlla11 ot1lc.r 'l~~pl-oaclles iu cxplol-ziti011 planning ljccause
28 JANUARY 1976
Resource Base
Mineral Resources
Undiscovered
Inferred
Resources
Speculative
Resources
Decreasing G e o l ~ g i cAssurance
----
the methodological and conceptual tools to make such ap-
praisals are exactly the same as those adopted in explora-
tion planning, i.e., in trying to delineate areas that are
hypothesized to contain possible ore deposits; this is what
explorers call "targeting."
I n recent years, many researchers have tried to combine
matliematical and geological appraisal methods. Chemical
surveys of areas considered favorable, for instance, have
Ijeen interpreted through geostatistical inference from
known metal distribution in well-explored control areas.
This has also been done with geological parameters con-
sidered favorable to the occurrence of certain deposits.
The ultimate purpose of such geostatistical studies and
proljabilistic evaluations is, for a certain area, to determine
the probability of finding a given economic deposit of cer-
tain grade and tonnage. However, in the absence of com-
plete knowledge of necessary and sufficient conditiolis for
the occulrence of ore deposits, it is impossible at present
to reliably determine the relative merits of small areas
with this approach. Currently, our best tool is the subjec-
tive geological judgment about the favorability of specific
areas Iby experienced appraisers and explorers.
What controls the possibility of recognizing valid target
areas is:
First, the quality and quantity of geological, geo-
chemical, and geophysical information available for vari-
ous areas. This is basic regional and local geology, usually
sllown on maps. 111 general, US basic geological, geochein-
ical, and geophysical regional information is very inconi-
plete; actually, the US stands out among the developed
countries as one of the lcast adequately covered with
geological mapping. This must be remedied 11y illcreased
systematic mapping efforts by the US Geological Survey
a~iclthe state geological surveys.
a Second, detailed knowledge of the characteristics
of ore deposits. Descriptive monographs of mining districts
are excellent for most pre-LVorld War I1 discoveries, but
nonexistent or inadequate for latter discoveries.
a Third, knowledge of the geological environments in
\\*hicll deposits of certain types and certain commodities
can occur and the processes by which deposition can take
place. Basic research on ol-c transportation and deposition
shorlld result in a much better understanding of the for-
111ation of ore deposits and, consequelitly, 111 improved
c~xplora~ion targeting. This might also lead to new con-
SOCIETY OF
cepts about the possible occurrence of theoretically plaus-
ible but yet unknown types of deposits. Research along
these lines is neither well-funded nor adequately staffed
in the US. We have had NASA, and we have talked
about a NASA-type effort for the oceans. We also need a
NASA-type effort for the mineral depths of the earth.
In this country, mapping programs and economic geo-
logic research efforts of the USGS, state geological sur-
veys, universities, and industry should be considerably en-
larged in order to improve the reliability of mineral re-
source appraisals.
The other resources needed for the conversion process
are mineral detection technology, extraction technology,
time, and money. A few words about detection technology
are now in order. It is essential to keep in mind that the
most efficient and discriminant detection technique is of
no avail if the area chosen as a target is not mineralized.
Exploration expenditures in the US average about 25%
for land and overhead, 25% for nondestructive detection
surveys, and 504; for destructive sampling and assaying of
excavated rock cuttings, cores, and sludges. The main de-
structive sampling technique is drilling. There is little
doubt that, in the future, drilling of geojogical targets not
expressed by geophysical and geochemical anomalies will
increase at a faster rate than drilling of geophysical-geo-
chemical anomalies. Also, exploration based on geological
concepts will aim at deeper targets than are currently
sought. Geological extrapolation is the best remote sensing
tool at our disposal.
The delineation of new metallic reserves through ex-
ploration will require a considerable increase in the
amount of drilling, at a considerable increase in explora-
tion costs with the currently available drilling and assay-
RECONNAISSANCE
/ \
APPRAISAL
attractive at
this time but not attractive
at this time
I 1 Ff
- -------- normal exploration sequence
@
-+
REGION
UNFAVORABLE
I
Fig. 1-The four main stages of "full-sequence" exploration.
MINING ENGINEERS
ing technology. Improvements and cost reduction in drill-
ing and assaying for metals would contribute more to in-
crease efficiency of the exploration dollar than any other
technical factor. Presently, there is very little research
done in the US and Canada on drilling for metal deposits,
either in industry or the government agencies. Improved
metal exploration drilling techniques and downhole analy-
tical techniques should be a high priority item for re-
search by the US Bureau of Mines.
Exploration Sequence
Fig. 1 shows a generalized sequence of exploration ac-
tivities that may lead to a mineral discovery. We start
with large areas under regional appraisals and progress
toward smaller and smaller areas containing a hypothetical
target, then a deposit. Please note that, at the first stage,
certain areas can, on the basis of present knowledge, be
eliminated as not having any potential for a given com-
modity. However, one should keep in mind that such ap-
praisals may be valid for deposits whose formation is rea-
sonably well known (e.g., coal, gravel, phosphate, placer
deposits, etc.), but are highly risky for metal deposits
whose origins are not as well known. Let's not forget that
we can make the same mistake for metals as those petro-
leum geologists who, 35 years ago, predicted the sedi-
mentary Williston Basin would not contain any oil and gas
fields; and those mineral appraisers who, 25 years ago,
were willing to zone the area south of Tucson as nonmin-
eral. As it is, the Williston Basin contains some petroleum
and the area south of Tucson has turned out to be the
largest concentration of copper deposits in the US. Re-
gional appraisals always include office studies and may in-
clude field and airborne surveys; depending on commodity
TARGET EXPLORATION DEVELOPMENT
/ \ m
"I!o:.'"stT' l
DETAILED DETAILED ECONOMIC
SURFACE THREE-DIMENSIONAL
at this time
recycling after temporary rejection
I I
key exploration decisions
NOT A MINERAL
DEPOSIT
MINING ENGINEERING 29
 and country, a regional appraisal program may take a few
weeks to a year and cost a few thousand dollars to a
million.
Regional appraisal leads to the definition of areas
worthy of detailed reconnaissance, wherein target areas
are delineated. These targets, or exploration working hy-
potheses, are born in the mind of the explorer.
laws should preserve his exclusive right to investigate his
target concept if the land is legally accessible. A detailed
area reconnaissance may take from six months to two
years and cost from $20,000 to $ 1 million. depending on
commodity, coulltry, and field methods.
Then, we investigate these target areas. First, through
surface exploration to try and determine the possible ex-
istence of a hypothetical ore target; second, through three-
dimensional sampling techniques such as drilling, pitting,
and underground working. The time for these two stages
may be one year to five years, and the cost from $100,000
for a failure up to $5 million for a successful program re-
sulting in discovery of a large deposit.
W e should be aware that any area that was once de-
scribed as a target area has some characteristics favorable
to the occurrence of certain deposits and, as such, can
never 11e definitely eliminated from exploration considera-
tion. It should remain available for exploration recycling
from time to time. Many deposits discoveretl today ma>.
become economically extractable only years hence; any
uneconomic discovery should remain available for future
economic conversion. For instance, many uneconomic
uranium deposits found in the last 2 0 years are just now
becoming economic reserves-thanks to the new tech-
nique of so!ution mining and to higher uranium prices.
I11 a complete exploration sequence, 11 large region corn-
prising several thousand square miles may be first ap-
praised and a successful program nlay cncl u p with onc or
more targets ready for three-dimensional testing, each
such target covering from a fraction of a square mile for
massive deposits, u p to several square miles ill the cast of
large, tabular occurrcnces. From the lantl te1iul.e poillt of
view, it is always essential to remember this progression
artd the need for recycling. Land use policies must allo\v
access to large areas, availability of target areas to the ill-
ventor of the target, and return to target arcas fro111 timc9
to time,
Availability for Conversion
At least five main factors determine whether the con-
version process can be achieved successfully. The exist-
ence of tht: resource is self-evident; this can 1)e lal~eletlas
geographic availability, which I have alreatly discussetl.
The other four factors-extractability, en\-iroriment, cn-
ergy, and economics-can be logically combined ill eco-
nomic availability and political availabilit!..
Economic Availa'bility
Economic availability and its counterpart, economic
scarcity, were analyzed in great detail in the early '50s.
These theoretical economic studies led to the optimistic
conclusion that economic availability of minerals displays a
pronounced trend toward continuous improvement. This
was extrapolated to indicate that there was no lower eco-
nomic limit to the grades of materials that could 1)e eco-
nomically recovered. Price was the controlli~igfactor. On
that basis, it then became fashionable to dcduct that gco-
logic availal~ilitywas not a factor in resource scarcity, and
that only economics controlled. the availability of m i i ~ ~ r a l
resources. There was no limit to growth.
30 JANUARY 1976
This theoretical concept was fostered by the observation
made by Sam Lasky of the Bureau of Mines: for a few
domestic porphyry copper mines h e investigated and
within a narrow range of then economically minable
grade, Lasky found that an arithmetical decrease in grade
was associated with a geometric increase in the tonnage
of the reserves. This observation became mathematically
expressed as "Lasky's Rule" (Grade =K1 - Kg Log Toll-
nage). I t did not take long before it was assumed that
similar tonnage-grade relationships could be extended to
many types of deposits over a wide range of grade, and to
assume that Lasky's Rule also applied to undiscovered
deposits. Thus, Lasky's Rule was erroneously used to sup-
port the concept of unlimited geological availability.
Since that time, new knowledge and exploration results
have thrown great doubt about both Lasky's Rule and the
concept of continuously improving economic availability.
I t is to Tom Lovering's credit that he first pointed out
some of the limitations of Lasky's Rule. First, limitation
on the high and low tonnage sides; then on the high and
low grade sides.
It is now recognized that Lasky's Rule is, within limits,
usable in a restricted, practical range of values for somc
individual known mines and even for a few minillg dis-
tricts, but it must be rejected as a universal tool for the
statistical evaluation of mineral distribution over larger
areas. For instance, students of porphyry copper deposits
of North America recently came to the geological and
mathematical conclusion that the available tonnage of
copper in the lowcr-grade deposits does not increase geo-
metrically with a decrease in grade. I t is now accepted
that each commodity and each type of deposit has its ow11
distribution laws and that Lasky's Rule doesn't apply to
any deposits but the medium-grade porphyry copper de-
posits for which it was formulated.
Now, with regard to economic scarcity, the conclusion
that there hasn't been and there is unlikely to be a warcity
of minerals in the economic sense is based on studies of
the trends in mineral availability over a period of about a
century. Barnett and Morse, in their famous study "Scarc-
ity and Growth," published in 1963, showed a persistent
decline during the period 1870-1957 in the labor illput
per unit of mineral produced. This was true not only of
minerals in the aggregate, but individually as well. Figs.
2., 3., and 4 illustrate the results of this studv for mineral
fuels, nonmetals, and metals.
T h e use of manpower requirement per unit of output as
an availability indicator is based on thc theoretical eco-
nomic concept that the production of a unit of a given
product requires input of three factors-land, lal~or,ant1
capital. If a scarcity of one factor develops, presumably a
greater input of one or both of the other factors rvould 11c
required to allow production. Historical trends dcinorl-
strate that the input of labor has been declining rather
than increasing. What's disturbing about these studies is
their use of manpower as the sole measure of cconomic
availability. The other two vital inputs, and other factors.
are disregarded: i.e., capital and land, plus mineral-based
energy, the metals used in machinery and equipinc~ltfor
mineral production, the use of water, and the laild dis-
turl~ancecaused by mining.
If all these inputs were calculated, assuming that some
adequate measure could be developed for l~alancillg or
weighing one against the other, what ~ v o l ~ ll)c d tlie toll-
elusion? Ilow, for example, does one balancc thc 1939-
1970 tlccrcasc of 7 2 ' ; i l l l a l ~ o rreqlliretl to mine ;: toll o!'
SOCIETY OF
 rallo

all mineral luels

petroleum and natural gas

I1 +- sand and gravel

t all nonmetals
bituminous coal
anthracite coal

Fig. 2-US mineral fuels: labor cost per unit of output, 1870-1957
(after H. J. Barnett, 1973).
t phosphate rock
copper, against an increase of 31% in the input of inani-
mate energy? (The total results may not be changed if
everything were taken into consideration, but the con-
clusion would be far more convincing if additional mea- Fig. 3-US nonmetals: labor cost per unit of output, 1880-1957
sures would be used.) For copper, unlimited economic (after H. J. Barnett, 1973).
availability was then assumed, based only on decreasing
labor input and on declining average copper grade (Fig.
5 ) . Is this correct?
I owe to the late Hugh Risser, mineral economist with
the USGS, some data he conveyed to me. Before his death
in 1974, he had started to investigate in depth the prob-
lem of economic availability. I'll show some graphs he
prepared which indicate that, for some commodities, the t all metals
economic availability measured in manpower input has
stopped decreasing and, in some cases, actually started
increasing in the 1970s. This is especially true for recov-
tiron ore
erable copper metal (Fig. 6 ) , as opposed to manpower
input per ton of crude copper ore. However, the trend
continues to be improving for iron ore.
Fig. 7 shows that manpower input started increasing
for all types of coal operations in the US. These graphs
demonstrate to me that historical observations should be
extrapolated only very cautiously. We might expect that,
Fig. 4-US metals: labor cost per unit of output, 187b1957
in the future, the same reverse trend may develop for
(after H. J. Barnett, 1973).
most mineral commodities, thus adding another limiting
factor to geologic and political availability.
Actually, the problem is that this application of eco-
nomic theory tells us that:

(1) There is no past evidence of a long-term trend of

economic scarcity of minerals in general.
(2) The long-term trend has been a decline in the
input of labor and capital required to produce a
given mineral.
(3) There have been temporary or short-term level-
i n g ~and upturns of inputs, but they have not
persisted.
(4) Tendencies toward increased inputs have been 0
interrupted by improved technology in discovery, 1910 1920 1930 1940 1950 1960 1970 1980
production, processing, and utilization, and also (From US Bureau of Mines data)
by substitution of other materials for the higher Fig. 5-Average recovered grade of US copper ores.
cost increments of the initial commodity.
problems of waste handling and disposal and dis-
Where Economic Theory Goes Wrong turbance of land areas.
Economic theory, as applied in the economic availabil- (3) Much of the technoIogica1 progress comes
ity model, does not tell us many important things. I will through breakthroughs that occur at irregular
now list a few of them: and periodical intervals.
(4) Major mineral discoveries also appear intermit-
(1) The decline in inputs of capital and labor are tently, rather than at regular intervals.
accompanied by large increases in energy input (5) The timing of such technological breakthroughs
and horsepower of equipment. and major discoveries cannot be predicted in ad-
(2) Decreasing grade is accompanied by increasing vance.

MINING ENGINEERS MINING ENGINEERING 3 1

 (6)

(7)
Economic evidence of an impending scarcity is a
lagging indicator; scarcity does not exist until the
moment that demand first exceeds the reserves
and production capacity.
Slineral supply is generally elastic in the short
3-

2-
-
Wum;
21% DtF-ROI
- 8.8 ~ M Mto
0.35% Cu
Im

term, up to the time that productive capacity is

fully utilized; it is also elastic in the intermediate -E
m
'-
term, up until production capacity equals the 0
0 0 - - 1 , 2 , 3 4 , 5 , 6 , 7
nlaxinlum producihility of known reserves; and "
0
supply is also elastic in the long term, hut only I
when allowance is made for time for the dis-
covery of new reserves.
--g 1- If sdd: $0.5 mHIm
atter-tax cost, and
(8) Economic theory doesn't tell us that each dis- E - O M War delay

:.overv which makes minerals a\.ailablc for use

2 a W thkd p a r ...
Refurn: 11.4%
reduces by an equal amount the potential for DCF-ROl
Future discoveries. 3-
b l a s t precipitation
(9) The time ~ e r i o dfrom initiation of search t h r o u0~ h
plant
discovery and development of production capa- 4-
bility is great and lengthening. With growing pro-
duction, the period required to exhaust a given Fig. 8-Small copper blast/leach surface project (1974), nondis-
rc,servc is shortening; it is i ~ o tthe rate of dis- counted cash flow after tax.
covery or the rate or prod~ictionthat governs the in 1970 (with an ore grade of 0.7% C u ) , the total energy
li~nitof pl-oducibility, hut the relation of avail- consumption to produce one pound of copper was ahout
able known reserves to the rate of production. 46.5 M J (44,000 Btu) per lb. At that time, extrapolations
to low-grade ores of 0.2% Cu, and to average rock with
Analysis of eco~iomicavai1:tbility studies poi11ts to the, 100 ppm Cu, indicated that there was an energetic limit
failings oi econonlic theory with regartl to energy, mate- to comer availabilitv. This limit has beem e m ~ h a s i z e db\.
rial, and time inputs. Let us illustrate these points. L L

the drastic increases in energy costs in the last two )cars.

,-.-.
With regard to carlerg!jinput, Table 2 shows n table pre- The National Academy of Sciences reached a tentative
pared by Kellogg in 1973; it indicates that for US copper conclusion in early 1975, based on mineralogy and energy
~~~ .T.... ~..
~ .~~~ .--. ~ .--
-- ---7 requirements, that it was unreasonable to assume that anv
k. !
copper material with a grade of less than 0 . 1 5 copper
ratio of 1
scale /
..' 1I 1 I
I
would be mined in the f u t ~ r e .This~ definitely puts a
limit on the availability of newly-mined copper for gen- - -

erations 100 years from now.

Many studies have been prepared of energy input in
various materials with the purpose of comparing their
energy intensiveness. The figures below show that con-
C.
9 r- crude copper ore 1
1
crete,-as a construction material delivered at the construc-
recoverable tion site, is considerably less energy-intensive than other
----3.4 copper metal
structural materials such as steel and aluminum. Such
studies should be developed further and constantly up-
dated, so that this input in economic availability can be
integrated in any studies of the economic convertibility
of mineral resources into mineral reserves.
crude iron ore I mentioned earlier that time was another factor not
usable iron ore
1940 1910 1960 197"
adequately taken into account in availability studies. As
long as this country functions under a capitalistic systeni
Fig. &Manpower input per ton of ore (after H. Risser, 1974). (or what's left of i t ) , new projects will have to promise ail
acceptable return on investment before funds call be oh-
tained and committed.
From this point of view, it is very enlightening to con-
sider the effect of time delays on the profitability of sonic
mining projects (Figs. 8, 9, and 1 0 ) . Let's take, for in-
stance, a small copper project involving blasting of thc
rock in place, followed by leaching in place and precipi-
tation of cement copper (Fig. 8 ) . This is a hypothetical
modeling example prepared more than a year ago. Thc
strip mmes 1 investment of about half a million dollars during thc first
year for land, exploration, drilling, and preliminary metal-
lurgical tests is followed by about $750,000 in the sccond
auger mlnes year for further metallurgical testing and feasibility study;
1 i --
all mones
and then, in the third year, by an investment of $3 mil-
lion to implement a large in-place blast and the construc~
tion of a leaching and precipitation setup. This operatio11
Fig.-7 Manpower input per ton of bituminous coal output (after can produce cement copper at a declining rate f o r foul.
H. Risser, 1974). years. The model deposit of 8 5 million tolls of 0 :35':

SOCIETY OF
32 JANUARY 1976

Fig. 9-Medium-size underground zinc project (1973),
counted cash flow after tax.
copper would deliver a discounted cash flow return on
investment after taxes of 21%, according to this schedule.
However, if reasons such as lack of smelter availability,
or need for detailed ground water environmental study,
caused a delay of one year at an after-tax cost of half a
million dollars, the return rate would come down to 11.4%>.
I t is doubtful that, with such a delay, any investor would
put money into such a venture. This is a good example of
conversion of reserves into uneconomic resources. If the
copper depletion allowance were cancelled, the rate of
return would decrease from 21% to 9%-another case of
reverse conversion. Increase taxes by 25% and this deposit
can go into oblivion as a reserve.
Fig. 9 gives another example. This model is a sizable
zinc deposit, containing 29 million tons of 6 % zinc ore in
a flat-bedded deposit at a depth of around 460 m (1500
f t ) , which can be extracted through underground mining
and concentrated in a flotation mill. Such operation would
sell zinc concentrates to ;I zinc smelter. After a seven-year
period and an investment of $34 million in surface ex-
ploration and underground exploration, followed by feasi-
bility study and equipment of a mine and a mill, such a
deposit, over a production life of 2 3 years, would deliver a
discounted cash flow return on investment of about 197;.
However, if you insert before the expensive construction
program a two-year de1a.y at a half-million dollar after-tax
cost for each year, the return is decreased to 17% and the
payout, a very important economic parameter to any in-
vestor, is suddenly increased from 4.6 years after start of
production to 7.7 years after start of production. This de-
lay might be acceptable to some investors. However, if
for reasons such as lack of smelter availability, environ-
mental or other kind of shutdown, or great economic dif-
ficulties in start-up, you insert after construction, before
production starts, a one-year delay at an after-tax cost of
$2 million, the return on investment is decreased to 14.7%
and the payout is increased to 8.9 years. These time effects
are drastic and more pronounced than one would guess.
The cancellation of the depletion allowance would fur-
ther reduce the rate of return by 4%-transforming these
reserves into uneconomic and unprofitable resources. If
profits are not reasonably expected, then a project will not
be started. After all, profits are nothing but the costs of
assuring our future.
The effect of time is less pronounced on large projects,
as shown by the example in Fig. 10, where our model is a
MINING ENGINEERS
3 i
125 mflllbn toru-Q.8% Cu
22.000 tDll
I 1
Fig. 10-Large copper open-pit project (1974), nondiscounted cash
flow after tax.
medium-sized porphyry copper deposit amenable to open-
nondis-
pit mining and treatment in a flotation mill. Such a de-
posit, according to this model, would require about four
years of exploration, a fifth year for detailed feasibility
study, and then two well-filled years for construction, at a
total investment of over $170 million. Then, if production
starts as planned, this deposit, for a production life of 17
years at 22,000 tons per day of ore, would give a rate of
return of 17% discounted cash flow return on investment.
A two-year delay before feasibility study, for reasons
which may be economic or environmental, means only a
small decrease in the rate of return. However, if you in-
sert a delay of one year with cost of $5 million after tax,
after the deposit has been equipped, then you seriously
reduce the rate of return to 147; and considerably in-
crease the payout from 5.0 years to 9.4 years. Cancellation
of the depletion allowance would reduce the rate of return
by about 37,, niaking such deposit uneconomic.
Another aspect of time used in determining need for
new production and new discoveries is the estimate of
"life of reserves." Table 3 shows that the apparent life of
reserves, as measured by total reserves divided by current
production rate, can indeed be a very misleading index.
When actual production rates are taken into account, we
find that the combination of five mines-A to E-with re-
serves as shown on the second column and with produc-
tion capability as shown on the third column, would pro-
duce 18 units per year for the first four years; then 14
units for the next six years; then 10 for the next 7 years;
then 7 for 33 years, until final exhaustion. Thus, the actual
production lifk is 50 years, at a rate varying between 7
and 18 units, instead of an apparent life of reserves of 25
years. If 18 units is a desirable production, then new de-
posits must be found and opened up by the end of the
4th year.
I t is critical that realistic evaluation of productive capac-
ity to exhaustion be inserted in any economic-mineral
availability studies. The US Bureau of Mines is to be com-
mended for introducing such time factors as productive
capacity and lead time for construction, expansion, and
start-up in its copper availability studies published two
years ago. Let's hope that the Bureau will extend this ap-
proach to other industrial minerals.
For those commodities where discoveries are needed to
satisfy future demand, then it is important to appreciate
the capital demands for achieving mineral discoveries and
the risks involved. Studies of the discoveries, and cost of
discoveries in different parts of the world, have indicated
that over the last 20 years the efficiency of the exploration
MINING ENGINEERING 33
 Table 2-Energy Consumption for Production of Table 3-Estimated Energy Consumption of
Copper Material Delivered at Use Site
(1970 and projected) (millions BTU per ton)
Year BOOO? Distant Aluminum 122
(tow-made Fptnre c o p er 89
1970, U S on) Baae Rock ~teeT 45
Ore grade, % Cu 0.7 0.2 Paper 42
0.01 Concrete 2
Recovery of copper, % 82. 80. 80.
Tons of waste rock per ton ore 2.34 1.5 0.5 (After COMRATE, 1973 and PCA. 1975)
Tons waste rock per ton copper 355. 940. 8300.
Tons tailings per ton copper 145. 620. 12 500.
Total tons waste cu ton oopper 500. 1580. 18:800.
~nergy*os*BmeBpar ton copper,
MiIIions of Btu: tanium, and lead because in that year we imported only
For rnbing 25.1 93.8 1875.0
For beneficiation 33.0 127.2 2543,8 5 1 % of our zinc needs, 33% of our titanium needs, and
For smelting + refine 30.5 30.5 30.5
Total energy 88.8 251.5 4449.3 36% for lead. However, our dependency on all other metal
To@ wergv, Btu per Ib coppa 44,300. 185,800. 2,225,000. commodities has worsened: as of 1973, it was 95% for
Equiv. Ib coal per Ib copper 3.5 10.1 178. manganese, 90% for aluminum, 18yi for iron ( a doubling
of dependency in three years), and 44r6 for tungsten. The
general trend for most of these commodities is for an ab-
dollar (expressed i l l constant tlollars) has decreased Ily solute increase in dependency, as measured in physical
about two-thirds. Without breakthroughs ill detection volume and dollars.
technology, this treild will continue. The political availability of imports varies considerabl),,
The risks involved in exploration are also increasing, as us shown on Fig. 11 (borrowed from a 1974 study 11y the
deposits are l~ecomingmore difficult to find, because of Council on International Economic Policy). For copper.
cover of barren rock and/or increased depth. For instance, vanadium, iron ore, titanium, lead, tungsten, zinc, nickel,
it is presently estimated that only lor: of the funds spent cobalt, platinum, chromite, and bauxite, a significant pro-
in Arizona for porphyry copper exploration are used on portion of our imports comes from developed countries,
targets which turn out to be deposits. In British Columbia, including Canatla, that are trading partners with the US.
for the same type of deposit, the proportion used suc- However, especially for bauxite, cobalt, manganese, tin.
cessfully is 6:'; ; whereas in Mexico, where less exploration alld chromite, we find a major part of our imports come
has taken place, the estimate is that 20C; of exploration from less-developed countries which do not have either
funds art: used successfully. The cost of failures is too of- tlie same social, economic, and trading characteristics or
ten forgotten ill lneasuring the economics of :] successful needs as developed countries. In studying the fulfillment
uroiect. of future US demand for these commodities, we must take
L ,

For another type of dcposit, the small- to mediuin-size.
high-gr,tde, massive sulfide deposit that is well-known ill
Canada, Australia, and other parts of thc ~vorld,it is esti-
mated that only I ( : of the exploration expendiiure is used
successfully.
With the increased capital denland for n c n mining op-
erations, and in view of the cunent capital shortage and
reduced profitability of the mining industr!., will the avail-
able risk funds for exploration be adequate for the US?
This is 3 critical question l~ecausepracticall). all esplora-
tion funds for metals come out of earnings and not out of
new equitv or debt.
Political Availability of Mineral Resources
This topic has received much attention in the last two
years. I11 the wake of OPEC's actions and of numerous ex-
propriations and nationalizations i r ~inany countries, it ap-
pears that the needed foreign supply \\rill have to come
inore through purchase from foreign producers than
through investinents l)y US industry for exploration and
de\relopment in foreign countries.
The three inajor industrial areas of the Free World-the
US, Western Europe, and Japan-import 13 C : , 75 %, and
90'; rcbpecti\rely of the industrial raw materials, other
thall fuels, which each consumes. Our position at present
is much more favorable than that of Western Europe or
Japan anti can l ~ econsidered in a separate context. How-
ever, our favorable positioll is being eroded.
Thc trend over the years 1950-1970 is shown in Table
5 . At prcsent, our dependency on imports of rnetallic met-
als varies from 15': for copper to 100": for chromium.
Looking ;ct Table 5, but updating the nurnbers for 1973,
\ve find that our depeiidency has decreased for zinc, ti-
into account the political climate, the potential for effec-
ti\,e cartelization, and the likelihood of expropriation in the
producer-exporter countries. Such analysis-combiilecl
with a study of ( a ) demand reduction, substitutability
and recyclability; ( b ) geological availability of inferred
reserves and hypothetical plus speculative mineral re-
sources: and., i\ c ), currentlv noneconomic identified min-
era1 resources in the an tell us whether special ef-
forts should be made toward attempting to iinprove our
supply position by increasing self-sufficiency.
A few comments about potential cartels are in order.
Table 6 shows that the conditions necessary for the success
of a cartel, such as OPEC, are not found to the degree
that they are found with respect to oil. When metallic
minerals are examined individually, some of thc condi-
tions required for supply and price control are as follows.
Table 4--Hypothetical Example of Reserves and
Productive Capacity
Ore Annual Appa"t
Mine Reserves Mining Rote Life to Years
Apparent life of reserves: 457 i18 = 25.3 years
Actual production would Last SO years:
18 units per year for first 4 y e m , then
14 units per year for next 8 years, then
10 units per year for next 33 years,
(After C. H. Burgess, 1974)

SOCIETY OF
34 JANUARY 1976
 t!
- Q) C E .-
Q)

P
'C
tuI
C
Q)
0
C Q)
s .-X
CI $ i= =I
CI

E
P Q)
CI
U
J iu' .-
z
0 =I
Q)
C .-
C

0
0 C

-0,
J m
C
=I
tu
m
tu
m
C
-etu
CI
0,
c
0
I-
z
Canada
other
US Production imports from developed countries imports from developing countries
(Aiter CCIEP, 1974 Special Report on Critical Imported Materials)

I
I
Fig. 11-US metal import dependence (19731, US production and imports as percent of total US demand.

(1) There must be a concentration of mineral re-
sources and producible reserves in exporting-pro-
ducing countries.
( 2 ) The exporting-producing countries must have an
important share of the market.
( 3 ) The commodity must be inelastic to demand, and
show
( 4 ) Limited recyclability, and
(5) Limited substitutability.
( 6 ) Another factor favoring cartelization is a sizable
value added by processing, which means an im-
provement in the local economy if processing
takes placo locally and willingness for importers
to pay more for unprocessed raw materials.
( 7 ) Another factor is whether or not processing in
the producing country is, or would be, an im-
portant factor in achieving higher employment
locally.
Finally, shown on the right side, two extremely critical
requirements for control:
(8) The exporting-producing countries must derive a
major part of their financial strength from the
production of the commodity; and
(9) Market control can be used to satisfy specific in-
ternational p01it:ical purposes of the exporting-
producing countries.
These factors have keen rated from low to high-i.e.,
from 0 to 3 respectively. While these ratings are time-de-
pendent, qualitative, anti subjective, they are of help in
analyzing each commodity. If there is a potential threat to
supply, but also significant geological availability of do-
mestic resources for conversion to reserves, the US should
make an effort to increase its exploration and production.
But in the case of negligible geologic availability of do-
mestic resources, special efforts should be made to reduce
demand, to increase recycling and substitution and/or to
improve our trading and importing positions.
Availability Aspects For Certain Metals
Copper-US self-sufficiency in copper, if desirable, can
be attained in the short term, barring reconversion of re-
serves to resources through high-cost pollution abatement
measures. However, the small net imports from Peru and
Chile are not in any great jeopardy since effective cartel-
ization for copper is very dubious. Long-term self-suffi-
ciency can probably be reached through expansion of
production and through exploration in the US, but this
would require the opening of known low-grade and/or
high-cost deposits and discovery of many new domestic
deposits. The US and world resources are huge; economic
conversion to reserves and new production should take
place in due course, on a competitive basis, thus assuring
an economic and secure supply to the importing coun-
tries. Complete self-sufficiency does not appear either
necessary or economically desirable.
Iron-Ore is plentiful the world over and effective car-
telization unlikely. Our limited but increasing imports of
ore from Venezuela and of products from Japan and the
Common Market countries do not appear endangered.
Self-sufficiency could be attained in the US in the me-
dium term, but does not appear to be reasonably desirable

MINING ENGINEERS MINING ENGINEERING 35

 in view of increasing economic and stable political avail-
ability from developed countries and from market-econ-
omy developing countries, such as Brazil.
Lead-US self-sufficiency has been increasing steadily
thanks to discovery of the new hlissouri lead belt in the
mid-1950s. Recycling has 11celi high for years and is
slowly increasing. Lead is mined in many col~ntries ant1
cartelization is very unlikelv. I belie\-(- sclf-sufficiency
might be attainal~le in the .long ruu, hut nlay lot 11c
economicallv desiraSle in view of the high ;ix ailal~ilitvof
lead from neighboring countries.
Tungsten-US dependellcy has tlecrc.aset1 slightly ill
the last few vears. Our identified nonetonomic res0urcc.s
should eventually respontl to extraction tec*hnology rc-
search. 111 addition, purposeful exploratioir for tungsten in
the US should convert hypothetical and speculativc re-
sources into reserves. Such conversion cffort is very de-
sirable, since temporary cartelization is not unthinkable
and supply from Bolivia, Peru, and Thailantl cairnot bc
rated as lastingly sccure.
Zinc-occurs in many couutries ant1 docs i ~ o tappear to
be amenable to inarket control bv e x ~ o r t e r s . Self-suffi-
I I
ciency is increasing an(! will colltinuc. to iircrc*ase as the
discoveries of the ncn, mid-Tcnncssee ziric l ~ e l ta ~ devel-c
oped ant1 more domestic discoxcries are matl(:. IIepe11-
dency or1 Per11 (for some ilnports ok concentrates 1 ant1 on
Japan ifor metal j is significa~it,Imt does not suggcst all
attempt at self-sufficieilcy at ail)- p1.ic.c. is justified. So
short-term 01.long-term supply problems arc anticipated.
Nickel-has been supplied to the Free iVorld 11y a few
corporations based in developed countries. Wiiile domes-
tic self-sufFicie:lcy is not possible in the short trrnl. huge,
marginally economic resources in XIinilcsota descrvc! <,oinc
extraction technology effort to m'lke this source colrrpcti-
tive with foreign soilrccs. C'lnada, our main supplier, is ilot
running out of reserves, as it nlay 1)c l ' ~ rp e t r o l ~ u n ~ant1 ,
no supply shortage can b e reasona1)ly i?nticipatcd either
short-term or long-terin.
0
Bauxite-T'S dependency on imports oi I~auxitcis in-
creasing. .2 producers' associatic~rn led I!, Jainaic,,~11~1s
been successful in raising the price at I~ausite.IIowever:
aluminum is one of the most abundant elelncilts ;11id a1)-
pears i i ~\ ~ l r ~ o uSorms
s \xloi-ldwide. Price gouging 1)y ex-
porters w~oultlencourage reverse ,sulntit~~ti:)n of a l ~ l l n i n u ~ n
by materials ii has partly replaced. I t x\-ould also cllc,ouragc
the development of noi~bausitcresourccls which arc1 plenti-
ful in thc US. ?;o short- or long-tcvrm prol)l.z~riscall 1)e an-
ticipated. Efforts at economic extractioi~of the mct'~l f ~ o ~ i i
clays, alunite, and anorthosite xvill bc pursr~cd,ant1 ill the
next 1.5 to 25 years, such econumic cstraction will de-
crease o w tlepentlency un import., \vhilc ~)r('\.clitil~g huge
jumps in pric,rs.
Manganese---is another story. F o r e i g ~producers
~ have
successfully increased the price, and Kussia has followed.
Table 5.-US Imports as Percentage of US Consumption
1950 1970 Change
(After NCMP 1973)
36 JANUARY 1976
Our near-total dependency on developing and less-de-
veloped countries (Brazil, Gabon, South Africa, Zaire) is
increasing, and no marginal domestic resources are know11
that would justify a major metallurgical effort. So far,
production plans for metals from ocean nodules have not
included manganese mining because the economics are
submarginal and the quantity produced would flood and
destroy the manganese market. However, such plams
would be revised if the price of current high-grade mall-
galiese ore becomes exorbitant. Thus, I foresee that tratir
in a market that needs discipline itself will continue with
out endangering the short-term and long-term supply of'
the US.
Tin-Imports from Xlalaya, Thailand, and Bolivia ard:
essential to the US. Some large low-grade resources exist
in the US, but are not competitive with foreign sources. A
producer-consumer association, the Tin Council, has es-
isted for years and has exerted a calming influence 011 thc
market cycle. I would expect such influence to last and to
:~llowadequate short-term and long-term supply for the
US. It is utopic, at present, to dream of self-sufficiency for
tin.
Platinum (and gold)-Cartelization wo111d requirc the
collusion of South Africa and the USSR, an e v e l ~ twhich
may not be as unlikely as it appears. Howexrer. 110th
countries generally need exports to gain foreign e x h a n g c
Domeitic rcsourccs occur in Miiinesota, Slontana, an(!
Alaska, but are not competitive at present. Although ex-
ploration in the US will continue, it is \-ery unlikely that
reserves call be created ill the short term that urould
support a production sufficient to decrease significantly
our dependency. For the short tern], \ve nlust contiiiue to
look to trade and bilateral supply agreements to maintaii~
our supply.
Chromium-Our chromium self-sufficiency is nil. nnci
our domestic resources are too marginal to even tlreall~
that any can 11e converted to reserves, except at the cost
of high government subsidies. Foreign sources of chron~itc.
.II-(, very restricted: USSR, Philippines, South Africa, Tur-.
kcy, and Rhodesia are the only signifcant produccrs. Cur
renl:ly, we have a very strange situation: the consumers
;Ire creating the possibility of price control by thcl pro-
tlucers. The United Nations' boycott against Rhodesia
resulted in the USSR increasing the price and exen IIU)--
ing Khodesian chromite for resale to the US. T h e condi-
tions for a c a ~ t e lexist, but political ideologies of thr pi!]
duccrs are widely disparate. However, a d e facto ~ ~ l r t r l
could develop, like the collaboration of Russia with S o u t l ~
Africa in sustaining the diamond cartel, the world's oltlcs!
successful cartel which began in 1888 and faded away
only recently. With an inelastic demand, c,hromium coi!
suillers are at tlle mercy of producers; a threefoltl ill-
crcase in price would increase stainless steel cost hy 20' .
I t is unlikely that prices will not b e controlled rlpnartl
1950 1970 Change
SOCIETY OF
 Table 6-Main Factors Required for Control of Price and Supply

Limited Limited Value Labor

Minerals Concentration Share of Inelasticity Recycl- Substitut- Added by Intensive Financial Political
Metallic of Supply the Market of Demand ability ability Processing Processing Strength Purpose

Copper 0
Iron Ore 0
Lead 0
Tungsten 2
Zinc 0
Nickel 3
Bauxite 1
Manganese 0
Tin 2
Platinum 3
Chromite 3
Petroleum 2
De ree of existence of these control factors (After Mason
3ery Low, 0; Low, 1; High, 2; Very High, 3.

but even a drastic increase would not make reserves out of
the domestic resources.
Chromite, manganese, tin, and platinum supplies are
the most critical; the likelihood of developing successful
conversion of resources to reserves appears to be neither
geologically nor econoniically possible in the US. For
these commodities, it seems that we will have to continue
to rely on imports from traditional sources; we may en-
hance our position by making special bilateral arrange-
ment with the suppliers, or seeking a multilateral solution
in concert with other affected importing-consuming coun-
tries.
Availability Of Metals From The Deep Oceans
Considerable exploration, mining, and metallurgical ex-
traction research and development work has been done,
mostly by US corporations, in the last 12 years. The US
industry is undoubtedly in a leading position with regard
to economic development of these nodules. The resources
of copper are large; at least equivalent to those estimated
on land. They are enormous with regard to nickel, cobalt,
and manganese; their geological availability is excellent,
their economic availability has improved enough to con-
sider feasibility studies and financing schemes. But their
political availability is presently nonexistent. The deep
oceans are a legal no-man's land without adequate legal
protection for the potential producers. With political as-
surances of security of tenure, these deposits will become
competitively exploitable within the next decade. Such
international assurances may be forced by actions of in-
In the United States, limited geologic availability, as
estimated at present, precludes the creation of adequate
domestic reserves for a few metal commodities-chromite,
tin, platinum, and manganese. For the other metal com-
modities, creation of needed new reserves can be achieved
through exploration-if the economic climate is favorable.
That is a big "if" because such a favorable climate-free
of incapacitating uncertainties-depends on the avail-
ability of land, of stable energy supplies, of capital for
high-risk exploration and for development, and on security
of investment recovery and of profit retention. In effect,
the conversion of domestic mineral resources to reserves
needed to assure the future growth and freedom of our
country will occur when a solution is found to such prob-
lems as land withdrawals, the energy shortage, the capi-
tal shortage, inflation, and crippling taxation.
References
Barnett, Harold J., 1973, "Energy, Resources, and Growth," Re-
search Monograph 7381, Dept. of Economics, Washington University,
St. Louis, Mo.
'Bourrelier, P., F. Callot, R. Diethrich and Hugon, J. P., Annales
des Minzs, January 1975, pp. 1-68.
3 US Council on International Economic Policy, 1974, "Special Re-
port: Critical lmported Materials," 4 9 pp.
4 (US) National Academy of Sciences, National Research Council,
Commission on Natural Resources, Committee on Mineral Resources
and the Environment (COMRATE), 1975, Mineral Resources and the
Environment, 348 pp.
:US Depxrtment of Interior, Bureau of Mines, Commodity Data
Summaries, 1975, 193 pp.
US Dept. of Interior, Bureau of Mines, "Minerals in the US Economy:
Ten-Year Supply-Demand Profiles For Mineral and Fuel Commodities,"
1975.
- -
, 9 6-on.
L

'Occidental Minerals Corporation, staff reports and evaluations, es-

dividual countries.
pecially contributions on cartels by M. A. Mason, vice-president; rate of
However, any new production will be limited by the return computations by Ronald L. Haxby, senior staff mining engineer.
capability of any mining ship unit; 10,000 tpd is the larg- C. Harry Burgess, private, 1974
est nodule production unit contemplated at present. I t Hubert E. Risser, private, 1974
would appear at this time that the most we can expect is
a verv minor contribution to the S U D D ~ Vof coDDer and a
sizabic: contribution to the supply 3 iickel and cobalt.
1 1
About the Author
Pau! A. Bailly is president of
The manganese content cannot be considered an economic Occidental Minerals Corp. (6073
West 44th Avenue, Wheat Ridge,
resource at present. The ocean nodules give us an ex- Colorado 8C033), a subsidiary of
cellent example of the combined effects of geological, Occidental Petroleum Corp. After
obtaining his MS i n geology
econornic, and political availability on a possible future from the University of Nancy,
France, he pursued graduate
supply. studies at Yale University, and
received his Ph.D. i n geology
Conclusion from Stanford University. Before
joining Occidental, Dr. Bailly
For the whole planet. conversion of nonfuel resources worked for Kennecott Copper
Corp. and Bear Creek Mining Co.
to reserves is limited only by economic and political avail- A member of several professional
ability problems. There are no foreseeable geological avail- societies, including AIME, he has
also served on various commit-
ability problems for centuries. Because of current inflation tees of the National Academy of
and taxation, however, there are more reserves recon- Sciences and the National Re-
search Council. Dr. Bailly has
verted to uneconomic resources than there are new re- section on "Minerals Explora-
written numerous articles on ge- tion" i n the SME Mining Engi-
serves created by exploration and extraction research. ology, development, public land
laws, and is the author of the neering Handbook.

MINING ENGINEERS MINING ENGINEERING 37