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By Grover R. Castle

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

Jan 1, 1985

By M. Smutz, C. J. Baroch, E. H. Olson

IN 1949 an orebody containing some 10 billion lb of recoverable rare earth metals was discovered in the Mountain Pass district of San Bernardino County, California.' The following year Molybdenum Corp. of America purchased a number of claims at the deposit and a mill on the property which had been constructed to process the district's gold ores. Average composition of ore from the San Bernardino deposit is less than 0.1 pct Tho2, 25 to 35 pct calcite, 10 pct rare earth oxides, 15 to 20 pct silica, and 30 to 40 pct barite.' Rare earth content of the ore analyzes 50.7 pct CeO2, 4.2 pct Pr6O11, 11.7 pct Nd2O3;, 1.3 pct Sm2O3,, and 34.3 pct La2O3 and others.' By floating the barite and depressing the bastna-site, Molybdenum Corp. of America produced a concentrate that contained 60 to 70 pct rare earth oxides. More than 25 pct of the rare earths, however, was lost in flotation. It seemed likely that a more economical method could be found. At the present time most of the rare earths in the concentrates are converted to rare earth chlorides, which are either fed to ion exchange columns for separation of the individual rare earths or reduced to misch metal. Current investigation shows that solvent extraction may achieve this separation more economically than ion exchange. The study reported here was undertaken to develop an economical method of preparing a pure rare earth nitrate mixture from California bastnasite ore. Results indicated that more than 98 pct of the rare earths could be recovered. Several possibilities were considered for processing bastnasite ore, but only the method outlined in Fig. 1 was investigated. This involved leaching the calcined ore with nitric acid. The nitric acid process is discussed under the following headings: 1) calcination of the ore, 2) leaching of calcine, 3) filtration studies, 4) solvent extraction, and 5) nitric acid recovery. Calcination: Since California bastnasite ore contains 25 to 35 pct calcite and about 10 pct bastnasite, calcination was needed to reduce the violence of reaction with nitric acid. Weight losses of 26 to 30 pct were obtained by calcining the ore at 900°C for I hr or at 800°C for 4 hr. Longer periods resulted in no further weight loss. Leaching the Calcine: When the bastnasite calcine was leached with 30 pct nitric acid for 8 to 10 days, rare earth recoveries of only 45 to 50 pct were

Jan 1, 1960

For the year ending February, 1920 PRESIDENT HORACE V. WINCHELL MINNEAPOLIS, MINN. PAST PRESIDENTS PHILIP N. MOORE ST. Louis,. Mo. SIDNEY J. JENNINGS NEW YORK, N. Y. FIRST VICE-PRESIDENT A. R. LEDOUX NEW YORK, N. Y. TREASURER GEORGE D. BARRON NEW YORK, N. Y. SECRETARY BRADLEY STOUGHTON NEW YORK, N. Y.

Jan 9, 1919

By Donald B. Gillies

PROBABLY the most critical and difficult period in an engineer's career is that between the completion of his college work and his attainment of professional recognition and accepted status in the industrial world. Upon leaving school the young graduate breaks his immediate ties with his educational institution and in a sense finds himself adrift. At this time in his life a society like our Institute has both the responsibility and the privilege of meeting a vitally important need in his professional life. Some of these young men are Student Associates, in the year after graduation, and some are Junior Members, but all need advice and assistance. In some respects this situation will be accentuated by the war. Not only will thousands of young engineers be mustered out of military service but the process we describe generally as industrial reconversion will make necessary many readjustments in personnel. About two years ago the Institute recognized the opportunity of helping the younger member to help himself by appointing a new standing committee to be known as the Committee on Professional Development of Junior Engineers. Herbert Hoover is Honorary Chairman and it is my privilege to serve as Chairman. The name of the Committee is not entirely satisfactory but it expresses the general objective. The present article is in the nature of a progress report of the work of this Committee.

Jan 1, 1945

By AIME AIME

THE paper by C. H., Lieb on the "Economics of Oil-Producing Practice" (June issue, M. & M.) contains much food for thought. The engineers should be gratified that an executive with Mr. Lieb's. responsibility should recognize their standing in the industry. Yet after giving them that recognition, he proceeds to spur them on to greater accomplishments by pointing out that their job is only partly done and in some instances poorly done. The operating policies in this paper when applied to new pools with flowing wells are sound. Neither do I take exception to their application to pumping wells. But I do wish to comment on what lie says about price when applied to the many more wells that are approaching abandonment that is, the small producing wells. Mr. Lieb states in effect that higher prices would be detrimental from the long range viewpoint. I doubt that the present prices of crude will provide an ample return from the hundreds of thousands of small wells that have possibilities of substantial recovery by means of water-flooding, repressuring with gas, and air drive. Probably expenditure for experimental work can he justified, but at this time it must usually be considered as experimental. Recently I visited a property where it was estimated that $250,000 would be spent on a 160-acre tract for flooding purposes. The rate of r e t n r n and amount of profit at today's prices are uncertain. It can be argued that if this type of recovery is not economic with crude at $1 then it can he delayed as it is now possible to secure economically an ample supply of crude from our flush fields. But these old fields still retain large quantities of crude in a dormant state, and should not he abandoned per-

Jan 1, 1936

By R. W. Raymond

That the death of Martin Coryell, which occurred at Lambertville, New Jersey, on Monday morning, November 29th, touched the sympathies of a wide circle of professional associates and personal friends, was amply testified by the gathering at the funeral services on Friday. Like his distinguished friend and neighbor, the late Ashbel Welch, Mr. Coryell was one of those pioneers in American engineering to whom we owe the great railway and canal systems which lie at the base of our national prosperity, and who have consequently enjoyed the respect and esteem of their successors of the present generation. Martin Coryell was born July 20th, 1815, at New ope, Rucks County, Pa., and was educated principally in the schools of his native town arid of Lambertville, New Jersey, to which place he returned for permanent residence fifty years later. With the exception of a brief period in youth, during which, to restore his failing health, he learned and practiced for a few months the carpenter's trade, and another brief period, later in life, when he read law for a time in the office of B. H. Brewster, of Philadelphia, afterwards Attorney-General of the United States, Mr. Coryell may be said to have spent his life as an active civil and mining engineer. Even these two episodes can scarcely be said to have been deviations from that profession, since they served to give him more thorough preparation for constructive and administrative work. The Delaware Division Canal, the Raritan Canal, and the Brunswick Canal, are among those upon which Mr. Coryell was employed. For the Raritan Canal Company, under the superintendence of Ashbel Welch, he located the greater part of the Belvidere Railroad (now the Belvidere division of the Pennsylvania Railroad), and directed its construction from Trenton to Lambertville. He was also active as a mining engineer, being one of the early pioneers of mining in the Lake Superior copper region, and had much to do with the development of the Hazleton coalfield and the railroad which has since expanded into the Lehigh Valley system. In 1862, he removed to Wilkes-Barre, where, in 1864, he became manager of the Warrior Run Mining Company. One of the editors

Jan 1, 1887

Primarily, 1961 was a year for widespread application of tools and techniques which have become operational in the past several years • • • Raising --Raise climbers and climber raising techniques have been improved; narrow veins as low as 55° dip are now being mined from climber raises. Climber modifications include: larger motors, tighter radius curves negotiated, improved lubrication and new methods of stowing the climber during a blast. Climber raises are now ventilated in several ways: a 12-in. diam flexible vent tube behind the climber rail; a 6-in. diam pipe behind the climber rail (with fan); or a 6 to 8-in. diam drill hole along the axis of the raise. In hot raises, these ventilating techniques have resulted in more rounds per shift. When driving raises from crosscut and lateral development, mucking machine loading of raise rock is preferred over slusher ramp loading for the following reasons: a) faster set-up and teardown of climber facilities; b) easier access for climber maintenance, repair and loading of raising supplies; c) area at the bottom of the raise can be kept cleaner. Both wide and narrow veins are mined from 7 x 7-ft climber raises at Butte and at Republic, Wash. At Republic, climber rollers have been modified to support increased weight when driving 55°dip raises • Drilling-The new largebore, short-stroke push feed drills are much faster drilling than previous models and are most satisfactory in hard ground. Although reports on maintenance studies of the new drills are not yet available, increased steel and bit wear and breakage, and increased drill maintenance are seen as potential problems. Mines in Montana and Idaho continue to test rubber-collared drill steel. The fabricating methods used are successful but advantages in increased steel life have yet to be proved. Underground applications of down-the-hole drills continue. Drilling speed and accuracy are reported as the outstanding advantages. Manufacturers are now hopeful of making drills which will operate in any direction. Present applications are for ventilation holes (to 8 in. diam) for climber raises, holes for hydraulic fill distribution, drain holes and "predrilled" raises. Good drilling accuracy has been reported to a depth of 200 ft. Cutting holes in drifting is seen as a future application

Jan 2, 1962

By D. V. Carter, Dan C. Williams, John R. Coombs

Exploration was active in East and East Central Texas during 1944. Ten oil fields were discovered during the year, of which four show promise of development. The discovery wells of the Sand Flat and Tyler, South fields were drilled to a depth greater than 10,000 ft., and the latter field now produces from the Pettit at a depth of 9890 ft. The Sand Flat well was plugged back to the Paluxy. The other two fields are Glen Rose producers near 8000 ft. The Pickton field produces from the Bacon Lime and Winnsboro from the Rodessa section. The Eylau field, Bowie County, was significant as the first Smackover production in Texas. Magnolia drilled a test in the Concord field, which topped salt. The most extensive and significant development in the district was the Carthage gas-condensate field. It expanded from the 8000 acres of last year to an estimated 190,000 acres, or about 300 sq. miles, and is not defined as yet. The first oil production in the Carthage area was made from the Travis Peak in 1944 in the Rogers Lacy's Cameron Lumber Company well No. I, on the northwestern side of the field. The New Hope field, Franklin County, scored the largest number of completions during 1944 with 24, bringing its total number of wells to 27. Two more pays were opened and produced as dual completions with the older horizons. The Manziel field, Wood County, had 19 new wells added during the year, for a total of 29, while the Pittsburgh field, Camp County, reached a total of 23 wells by completing 14 new ones. Material shortages and drilling restrictions dropped the total number of producing wells completed in the district from 171 during 1943 to 141 for 1944. Abandonments increased from 531 during 1943 to 609 for 1944. Of this number, 479 were in the East Texas field. Subsidy payments had very little effect in the district and it was mostly a few of the old fault-line fields that had any wells to fall within the requirements for subsidy payments. The prices of crude oil remained constant in the district except for increases as a result of subsidy payments. Production and Probation Wartime demands called for increased allowables for many fields, consequently the condensate and oil production for 1944 increased to 190,016,180, which is up 6.9 per cent over 1943. The East Texas field, of course, remained the principal producer of the district, accounting for 134,768'499 bbl. during the year, or 71 per cent of the district total production of condensate and oil. The field topped its own 1943 production by 4.8 per cent and became the first field in the world to produce 2 billion barrels of oil. The Hawkins field remained the second largest oil producer in the district, with 13,317,088 bbl. for the year, a drop of 6.8 per cent from 1943, while Van field was third with 11,635,708 bbl. The

Jan 1, 1945

By A. M. Gsudin, F. W. Bloecher, C. S. Chan-s, P. L. De Bruyn

M ANY elements can now be obtained in radioactive form. The radioisotopes have the same chemical properties as the corresponding inactive forms, differing from them only by their nuclear instability. This combination of properties permits radioelements to act as atomic tracers, the tracer atoms revealing themselves at the time of their decay with emission of electrons and positrons (beta radiation), helium nuclei (alpha radiation), or electromagnetic radiation (gamma radiation). The tracer technique is particularly attractive for the study of surface chemistry problems in general and flotation problems in particular because of its extreme sensitivity. A large proportion of the ionizing events, initiated by the characteristic decay emissions in a radioactive sample, can be recorded by radiation probes of suitable design and geometry. An idea of this sensitivity can be gathered from the following example: assume that 0.001 mg of pure RaD (radiolead), a beta-ray emitter, is used in a flota¬tion tracer experiment. This is 1210 X 10-1 mole; since the fraction trans¬formed per second (the so-called decay constant), is 9.92 X 10-10, the number of ionizing events per second would be (6.023 X 1023 X y,,, X 10-1) X 9.92 X 10-10 = 2.845 X 106. (The decay constant is expressed in sec-'. Its product with the half life, expressed in seconds, is the pure number, natural logarithm of 2 = 0.693. The half life is the length of time required for decay of one half of the total number of radioactive atoms of one particular type.) (See reference (1) at the end of this article.)

Jan 1, 1948

(Members are urged to send in for this column any notes of interest concerning themselves or their fellow-members.) Members and guests who called at Institute headquarters during the period Apr. 10, 1916; to May 10, 1916: Philip P. Baily, New York, N. Y. George W. Otterson Seattle, Wash. John M. Brooks, Jr., Knoxville, Tenn. C. Q. Payne, New York, N. Y. C. A. Burdick, New York, N. Y. Charles F. Potter, Los Angeles, Cal. W. N. Crafts, Oberlin, Ohio. Albert E. Rhoads, Harrisburg, Pa. Andrew B. Crichton, Johnstown, Pa. M. F. Sayre, Schenectady, N. Y. 0. P. Hood, Pittsburgh, Pa. H. V. Smythe, Northpines, Ont., Canada. W. McA. Johnson, Tulsa Okla. W. 0. Snelling, Long Island City, N. Y. G. H. Morgan, New York, N. Y. W. H. Staver, Ophir, Colo. E. G. Norton, Chicago Ill., A. W. Tucker, Salisbury, N. C. M. L. O'Neale, Coal City, Ala. Andrew Weisenburg, Philadelphia, Pa. Arthur H. Brown has resigned his position with the Dome Lake Mining & Milling Co., South Porcupine, Ont., Canada. Robert Sterling has resigned his position as chief engineer of the Goldfield Consolidated Mines Co., Goldfield, Nev., to accept the position of assistant manager of the vanadium mines of the Primos Chemical Co., Vanadium, Colo.

Jan 6, 1916

By Samuel D. Warriner

(Wilkes-Barre Meeting, June, 1911.) THE dealings between concentrated capital invested in the conduct of our various industries and the combinations of labor known as "trade union organizations," have produced not only in the United States, but abroad, many novel methods of negotiation between employers and wage-workers. The size and strength of these organizations have destroyed the personal elements formerly governing the dealings between employer and employee and have produced various forms of trade-agreements now in more or less successful operation. The difficulty, however, has- been to secure consent of both parties to an equitable agreement. For this purpose there have been devised various forms of arbitration, either compulsory under the shadow of governmental legislation, or voluntary by mutual agreement. But these have not been altogether successful from a technical stand-point, for the reason that a compromise has generally been necessary, and in an effort to reach an agreement, terms have been made which have been neither fair nor satisfactory to either of the contending parties. The Anthracite Board of Conciliation represents one of the few thoroughly successful courts for the settlement of trade-disputes, if not the only one which has yet been evolved. The prestige of this board rests upon its successful treatment of the labor-troubles of the anthracite region for a period of more than eight years, and upon the fact that it has been able not only to reach decisions based upon the merits of the controversies, but to enforce its decisions upon both the employees and the employers. It has never been obliged to shape its conduct to secure the consent of the contending parties, and its decisions have been strictly and, in the main, cheerfully observed. The remarkable feature of this board has been that it has

Aug 1, 1911

By E. L. Tucker

PREVIOUS investigations of E. L. Tucker and R. E. Head' related in particular to the effect of cyanogen compounds on galena, sphalerite, and pyrite, and their behavior in the presence of such com- pounds. The present contribution deals with the float- ability of the copper minerals and of pyrite. All experiments were performed on minus 200-mesh material, the method of preparation being the same as that described in the previous article. Flotation tests were made in a small mechanically agitated machine of 50-g. capacity designed in this laboratory by Gates and Jacobsen." General Naval Stores pine oil No. 5 and potassium xanthate were used in constant amount in all of the experiments; these agents were selected because of their present wide use in the flotation of copper minerals. Lime additions were varied to secure four 'final hydrogen ion concentrations, namely, neutral, 0.0005 per cent CaO, 0.003 per cent CaO, and 0.02 per cent CaO. The variation in lime addition was introduced to include the range of alkalinities employed in actual flotation practice.

Jan 1, 1926

By Alec M. Crowell, J. W. Sanders

While the production of crude oil and condensate in South Arkansas increased only 1.7 per cent over the 1940 figure, complete utilization of gas produced with the oil and condensate, and heretofore wasted, was beginning to be evidenced. There were 26,229,264 bbl. of oil and condensate produced in South Arkansas during 1941, as against 25,790,380 bbl. for the year 1940. (Fig. I.) Since 1936, deep producing sands have been discovered in 18 fields and during that period only 40 per cent of the total state production has come from Upper Cretaceous formations while 60 per cent came from the Lower Cretaceous and Jurassic formations. The gas produced with crude oil and condensate from the latter formation contains large quantities of hydrogen sulphide, the maximum being 6900 grains per 100 cu. ft. in the Patton pool of Lafayette County. Gas Utilization During the latter part of 1940 and the early part of 1941, pilot plants were placed in operation to determine whether the hydrogen sulphide and deleterious material in South Arkansas gases could be removed economically. The Federal Government desired to build a large aluminum plant in the Ouachita Valley and was seeking cheap fuel for the generation of electricity. The fact that the gases were produced with appreciable quantities of crude oil and condensate made it available at a very low price, since the state's conservation law prohibits the flaring of any gas. As a result of these experiments the first large-scale unit for the processing of gases containing hydrogen sulphide was placed in operation on Sept. I, 1941. The plant is in the Magnolia oil field, Columbia County. It processes residue gas from the Shell Oil Company's gasoline plant in that field and also raw gas from the Village field, 6 miles east of the Magnolia field. The gas entering the desulphuri-zation unit is laden with approximately 1400 grains of hydrogen sulphide per 100 cu. ft. and is stripped to a content of 4 grains per 100 cu. ft. The capacity of the plant is 15 million cu. ft. of gas treated daily under a pressure of 160 lb. per sq. in. The cost of treatment, exclusive of depreciation, is appreciably less than I per 1000 cubic feet. Two other plants of much greater capacity have been announced and priorities have been granted, which should bring the total amount of gas treated to 150 million cu. ft. daily. The gas to be treated will have a maximum hydrogen sulphide content of 4500 grains per 100 cu. ft. and will be processed under a pressure of 600 lb. per sq. in. These developments are something entirely new in field practice for the industry. The fact that this heretofore wasted gas is available at very low cost has led to the location of some eight war industries within the state, in addition to the alu-minum plant. Recovery OF Sulphur The Susearch Corporation and the Southern Acid and Sulphur Co. placed in operation during 1941 pilot plants to de-

Jan 1, 1942

By Alec M. Crowell, J. W. Sanders

While the production of crude oil and condensate in South Arkansas increased only 1.7 per cent over the 1940 figure, complete utilization of gas produced with the oil and condensate, and heretofore wasted, was beginning to be evidenced. There were 26,229,264 bbl. of oil and condensate produced in South Arkansas during 1941, as against 25,790,380 bbl. for the year 1940. (Fig. I.) Since 1936, deep producing sands have been discovered in 18 fields and during that period only 40 per cent of the total state production has come from Upper Cretaceous formations while 60 per cent came from the Lower Cretaceous and Jurassic formations. The gas produced with crude oil and condensate from the latter formation contains large quantities of hydrogen sulphide, the maximum being 6900 grains per 100 cu. ft. in the Patton pool of Lafayette County. Gas Utilization During the latter part of 1940 and the early part of 1941, pilot plants were placed in operation to determine whether the hydrogen sulphide and deleterious material in South Arkansas gases could be removed economically. The Federal Government desired to build a large aluminum plant in the Ouachita Valley and was seeking cheap fuel for the generation of electricity. The fact that the gases were produced with appreciable quantities of crude oil and condensate made it available at a very low price, since the state's conservation law prohibits the flaring of any gas. As a result of these experiments the first large-scale unit for the processing of gases containing hydrogen sulphide was placed in operation on Sept. I, 1941. The plant is in the Magnolia oil field, Columbia County. It processes residue gas from the Shell Oil Company's gasoline plant in that field and also raw gas from the Village field, 6 miles east of the Magnolia field. The gas entering the desulphuri-zation unit is laden with approximately 1400 grains of hydrogen sulphide per 100 cu. ft. and is stripped to a content of 4 grains per 100 cu. ft. The capacity of the plant is 15 million cu. ft. of gas treated daily under a pressure of 160 lb. per sq. in. The cost of treatment, exclusive of depreciation, is appreciably less than I per 1000 cubic feet. Two other plants of much greater capacity have been announced and priorities have been granted, which should bring the total amount of gas treated to 150 million cu. ft. daily. The gas to be treated will have a maximum hydrogen sulphide content of 4500 grains per 100 cu. ft. and will be processed under a pressure of 600 lb. per sq. in. These developments are something entirely new in field practice for the industry. The fact that this heretofore wasted gas is available at very low cost has led to the location of some eight war industries within the state, in addition to the alu-minum plant. Recovery OF Sulphur The Susearch Corporation and the Southern Acid and Sulphur Co. placed in operation during 1941 pilot plants to de-

Jan 1, 1942

By C. E. Shoenfelt

The year 1939 witnessed the rapid development of several of the more important Rocky Mountain oil and gas areas and the discovery of new oil and gas fields. As a further result of an active year, many oil fields had their productive limits greatly extended or responded to deeper drilling with oil production in lower horizons. In Colorado there was a substantial increase in refinery capacity, with three new units constructed. Its contribution to the crude-oil supply was an important extension of the producing area of a Western Slope field and a deeper oil-producing horizon in an old field east of the Front Range. Occurrences of gas were reported in two wells in northwestern Colorado, but severe winter weather prevented tests and the value of these discoveries cannot be determined at this time. Montana's northern fields were extended and a number of record wells were completed. The North Cut Bank area gives promise of wide expansion in 1940. The gas-producing area of Wyoming's Elk Basin field was extended into Montana on the north plunge of the anticline. The most important developments in Wyoming oil fields in 1939 were extensions to the producing area of Lance Creek and the discovery of a deeper pay in the Tensleep formation at Wertz dome. A new gas field at Horn Valley in the south central part of the state was the only new field discovered, but wildcatting was at low ebb in Wyoming in 1939. Colorado In Colorado, the year 1939 saw the completion of several interesting tests, but largely with negative results. Oil was discovered, however, in a deeper sand in the old Fort Collins field and the productive area of the Wilson Creek field was extended. Gas had been noted in two Western Slope wells, at Yellowjacket-Buford and at Trull, but their volumes had not been determined at the end of the year. Of principal interest, however, were the failures, descriptions of which will be given presently. One of these established a new depth record for Colorado.

Jan 1, 1940

By C. E. Shoenfelt

The year 1939 witnessed the rapid development of several of the more important Rocky Mountain oil and gas areas and the discovery of new oil and gas fields. As a further result of an active year, many oil fields had their productive limits greatly extended or responded to deeper drilling with oil production in lower horizons. In Colorado there was a substantial increase in refinery capacity, with three new units constructed. Its contribution to the crude-oil supply was an important extension of the producing area of a Western Slope field and a deeper oil-producing horizon in an old field east of the Front Range. Occurrences of gas were reported in two wells in northwestern Colorado, but severe winter weather prevented tests and the value of these discoveries cannot be determined at this time. Montana's northern fields were extended and a number of record wells were completed. The North Cut Bank area gives promise of wide expansion in 1940. The gas-producing area of Wyoming's Elk Basin field was extended into Montana on the north plunge of the anticline. The most important developments in Wyoming oil fields in 1939 were extensions to the producing area of Lance Creek and the discovery of a deeper pay in the Tensleep formation at Wertz dome. A new gas field at Horn Valley in the south central part of the state was the only new field discovered, but wildcatting was at low ebb in Wyoming in 1939. Colorado In Colorado, the year 1939 saw the completion of several interesting tests, but largely with negative results. Oil was discovered, however, in a deeper sand in the old Fort Collins field and the productive area of the Wilson Creek field was extended. Gas had been noted in two Western Slope wells, at Yellowjacket-Buford and at Trull, but their volumes had not been determined at the end of the year. Of principal interest, however, were the failures, descriptions of which will be given presently. One of these established a new depth record for Colorado.

Jan 1, 1940

By Jacques B. Wertz

Detailed structural studies in southeast Arizona have successively revealed (1) the local attitudes of individual fractures (with lateral and/or vertical displacements), (2) the patterns exhibited by groups of fractures, and (3) the trends and directions shown by fracture groups or zones on a regional scale. The results of the studies have been twofold: First, domes were locally determined from these fracture arrangements, even where other criteria failed; and, second, fundamental breaks brought out the breadth of the Texas lineament in southeast Arizona as well as major northwest- and northeast-trending fracture zones. Coincidence of one or several domes with the major intersections of fundamental breaks can be centers of important mineralization, as in the instances of Bisbee, Ajo and Morenci. THE OVER-ALL STRUCTURE OF ARIZONA A northwest-southeast trending anticlinorium has been suggested as the structural setting of Arizona. Starting in Triassic and culminating in late Cretaceous times, this deformation resulted from stresses of considerable magnitude with varying ratios of com pres sional and uplifting forces. However, the series of parallel flexures could just as well have been caused by isostatic movements involving dilation under tension with only incidental compression, as later emphasized by dike filling and block faulting (Fig. 1). The anticlinorial deformation, which is also suggested by the fact that the Pre-cambrian rocks to the southwest are all concealed by sediments, could be somewhat reminiscent of the conditions that affected the classical swarm of parallel dikes of wager.' ANALYSlS OF DATA As a first step in this analysis, all structural information obtained on such features as fractures and their relative displacements, faults, dikes, anticlines, synclines, and Precambrian and Laramide-Tertiary intrusives were plotted on maps along with structural trends inferred from aerial photographic mosaics. Next, the faults in southwest Arizona were classified according to time of occurrence and relative importance. The fault assemblages were then examined as to geometric or spatial arrangement and correlated with the occurrences of domes and existing Finally, the conjunction of fracture intersections and domes was analyzed and compared with locations of known ore deposits. Differentiation of Faults According to Time and Relative Importance: The faults encountered were grouped as follows: (1) Basin and Range faults, latest in time; (2) secondary faults; (3) primary faults; and (4) lineaments, earliest in time by inference. BASIN AND RANGE FAULTS- Generally concealed by alluvium, the Basin and Range faults are normal

Jan 1, 1969

By H. H. Stout

In the early fall of 1925, the writer was conducting, in the Ledoux and Co. laboratory, New York, experiments directed toward ascertaining the effect on its impurity content when cathode copper was subjected to a current of various gases at an elevated temperature below the melting point. The apparatus consisted of a vertical I-in. dia. silica tube about 12 in. long, heated on the outside. The cathodes were broken to pass 3/8-in. mesh, and a current of various different gases was passed up through a 4-in. long column of these loose cathode particles in the vertical tube furnace. Temperature was maintained to 1500º to 1600ºF. and the gas treatments lasted from 3 to 6 hr. The writer observed that whenever reducing gas (H2 or CO) was used, these cathode particles stuck together at points of contact with each other. The cohesion was so marked and tenacious that an examination was made of the fractured surfaces, when cathode particles were broken from the cluster. Crystal growth was always found to have taken place across the surfaces where separate particles were in contact, but only after all oxides, sulphates, etc., had been completely removed. The idea of a possible new process was then conceived and was disclosed to A. M. Smoot (V. P. Ledoux and Co.) with intent to obtain his views. The first conception as given Smoot was "to gas-clean broken cathodes, put them in an extrusion press, solidify and extrude them at around 1500ºF." Smoot's reaction, after a few moments considera- tion, was, "It looks perfectly all right to me.'' The writer and his assistants, W. H. Osborn and H. H. Stout, Jr., after conferring as to ways and means, decided to go ahead with preliminary laboratory experiments, which, it was thought, would move the new process from the possible to the probable. This program followed a course indicated by three basic considerations: 1. Since brittle cathodes were often unintentionally produced, it seemed probable that the laws controlling this type of deposition could be ascertained. 2. We had already proved the gas-cleaning feature. 3. There remained to prove: whether a sound, homogeneous metal billet could be produced with crystal growth established over the entire surface of each individual particle in the billet; and, if so, what would be the physical properties? Osborn arranged with Columbia University for conducting experiments in its research laboratory to prove or disprove the third item; Columbia assigned C. A. Phillipi, Jr. to assist in the project. A press with a cylinder 2 in. high and of I-in. dia. was used. It was surrouilded and heated by a resistance coil 01 Nichrome wire. Broken tough cathodes were used. Experimental Procedure The first run took place March 18, 1926. The resistance wire gave out when temperature of 1000ºF. was obtained. Pressure was immediately applied: perceptible ram movement stopped when 39,000 lb. per sq. in. on the copper was reached, with a maxi-

Jan 1, 1941

By G. H. LeFevre

THE Metal Sales Department, with offices in New York, is responsible for the sale of the Company's products, with the exception of gold and coal. At present the department handles the sales of lead, zinc, silver, antimonial lead, , cadmium, bismuth, arsenic trioxide, and tellurium; gold is shipped direct to the United States Mint and coal is marketed by United States Fuel Company's own sales organization. The department keeps in close touch with the metal markets and collects information on marketing conditions, which it makes available to other departments of the Company. The electrolytic lead produced at the U. S. S. Lead Refinery, Inc., is a high-uality product marketed as corroding grade under the "U. S. S.-ELECTRO" brand. It is largely sold to manufacturers of paints, pigments, lead oxides, and storage batteries.

Jan 1, 1948

By A. L. Jr. Pozzi, A. O. Garder, D. W. Peaceman

A new numerical method is proposed for the solution of multidimensional miscible displacement problems. Besides the usual stationary grid associated with numerical procedures, the method uses moving points for which positions and concentrations are computed each time step. Based on the method of characteristics for treating combined transport and dispersion, the method applies equally well to any number of dimensions and, in contrast with other numerical procedures, properly takes into account the physical dispersion, no matter how small. Extensive tests show that accurate solutions of one-dimensional problems can be obtained over a wide range of values of the dispersion coefficient, including zero. They also show that the moving points do not need to be uniformly spaced, and that increasing the number of moving points beyond 2/grid interval does not significantly improve the accuracy of the solution. Two-dimmsional calculations using the new method were carried out to simulate laboratory model displacements in which gravity caused overriding of solvent. Good agreement between observed and computed profiles and measured and computed concentrations of produced fluid was obtained for a viscosity ratio of 1.89; at higher viscosity ratios, fair agreement was obtained Computed results were found to be significantly affected by vertical dispersion, and negligibly affected by dispersion in the direction of flow, in agreement with conclusions based on experimental observations. INTRODUCTION Although miscible displacement processes are potentially of great economic significance, limited progress has been made in developing mathematical methods for predicting the outcome of a solvent flood. Because of the complexity of the partial differential equations which describe multidimensional miscible displacement, numerical methods are a natural approach to their solution. The task of finding suitable numerical approximations to one of the partial differential equations, which involves both dispersion and convective transport, has been particularly difficult. Dispersion in the absence of transport is described by the heat flow equation, a second-order equation of parabolic type. This equation has been very successfully treated by numerical methods. Transport in the absence of dispersion is described by a first-order equation of hyperbolic type. This equation has been treated numerically with some success in one dimension, both by Lagrangian and Eulerian techniques, 1.2 but extension to two or more dimensions has not been satisfactorily accomplished. Usually one of two things happens: either the numerical solution develops oscillations or it becomes smeared by artificial dispersion resulting from the numerical process. When transport and dispersion are considered simultaneously, this numerical dispersion may dominate the low physical dispersivicy that generally characterizes miscible displacement. Stone and Brian2 have developed a new difference equation for treating combined transport and dispersion in one dimension. By suitable choice of certain parameters, they succeeded in markedly reducing both oscillation and numerical dispersion. However, a satisfactory extension to higher dimensions has not yet been found. Peaceman and Rachford3 presented a centered-in-time and centered-in-distance difference equation combined with a 1,transfer of overshoot" procedure which was demonstrated to work well in one dimension. The technique was applied to the two-dimensional miscible displacement problem, but subsequent calculations with zero dispersivity showed little change in results compared with the calculations they presented. This indicates that their method involved a numerical dispersion of the same order as the physical dispersion. The present paper describes an alternate method for solving the combined transport-dispersion

Jan 1, 1965