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Provide the U.S. mining industry with the means to measure and control exhaust emissions of diesel engines used in underground mines. Approach Diesel research is divided into four primary areas: exhaust aerosol measurement, particulate control, gaseous emission control, and chemical and biological characterizition of particulate matter. Diesel research is frequently cosponsored by industry; collaborative research ventures between industry, academia, other government agencies, and the Bureau arc common. Diesel research at the Bureau is conducted in the diesel engine research facility at the Bureau?s Twin Cities Research Center (TCRC). This facility is a state-of-the-art laboratory capable of performing emissions testing, exhaust control evaluations, and safety tests. Background Exposure of mine workers to airborne contaminants from diesel engine exhaust is potentially harmful. The National Institute for Occupational Safety and Health has recommended that whole diesel exhaust be regarded as "a potential occupational carcinogen" and that ?reductions in exposure to diesel exhaust in the workplace would reduce the risk." The U.S. Mine Safely and Health Administration (MSHA) convened an Advisory Committee on Standards and Regulations for Diesel-Powered Equipment and is beginning to implement its recommendations, which cover health, safety, and certification and approval issues surrounding the use of diesels underground. In January 1992, MSHA published an advance notice of proposed rulemaking to regulate diesel particulate matter in underground mines.

Jan 1, 1992

By David M. Mchaina, Allan E. Hall, W. C. H. Kruining, Alan Coode, Stephen Hardcastle

This paper details an investigation into the feasibility of recirculating mine exhaust air in Saskatchewan potash mines. This project was initiated following a previous study at Ruttan Mine, Manitoba, which indicated that recirculation of exhaust air to reduce winter heating costs was feasible. The potash industry was selected for study because the mines use a minimum of blasting in their production methods and the exhaust temperature is significantly higher than that of most metal mines. These factors simplify the monitoring system required and have the potential for greater waste heat recovery. A series of measurements of underground mine pollutants was made at the main exhaust and intake shafts in order to determine the feasibility of introducing controlled recirculation of exhaust air. An experimental recirculation circuit was created by opening two existing doors situated between the return and intake shafts. During this recirculation trial, the air quality parameters at the intake, mixed intake and exhaust measuring stations were monitored. The results obtained from a questionnaire circulated to the regulatory agency and the major potash producers together with results obtained from underground field studies at Central Canada Potash (CCP) Division of Noranda Minerals indicated that controlled recirculation of mine exhaust air has potential application in these mines either to reduce heating costs and/ or to increase the face air quantities. A recirculation system is to be designed in conjunction with CCP and the Saskatchewan Ministry of Labour, Mine Safety Unit to attempt to implement a working recirculation system for CCP.

Jan 1, 1989

By A. English, Edward Martinez, L. A. Haas, N. W. Johnson, Harrison Copper, M. E. Tawil, C. C. Harris, G. V. Jergensen, D. Halbe, M. P. Amsden

Declining US ore grades along with skyrocketing energy, materials, labor, and regulatory costs underscored the urgency for technological innovation in the mineral processing area. Re¬liance on the scale-up and automation of unit operations was the sector's primary battle plan. Debate continues on the upper size limit of concentrating plants and whether process controls should be centralized or distributed in the mill. In the materials handling area, the economics of large-scale and mobile systems, particularly conveyors, were well documented in the literature. Comminution, the most costly and energy consuming area of the processing flowsheet, saw improvements in process controls and liner designs. The trend toward larger grinding units stalled somewhat during the year owing to some operational problems at commercial plants. Research and development of apparently less expensive physical separation processes-that also boast recovery of cleaner and more environmentally acceptable products -gained momentum during the year. Because of escalating capital cost requirements for new plant capacity, the year saw a greater interest by mill designers to re-examine existing capacity. The focus here is clearly to modify or retrofit unit operations with more efficient components as an alternative to installing more costly new equipment. The problems facing the processing sector during the 1970s can be expected to continue in the decade ahead. Technological gains from scale-up and process controls appear

Jan 5, 1980

By Dougal R. McCreath

The storage of energy in one form or another is a well established practice, demonstrated by the familiar sight of large oil storage steel tanks. Today, however, the problems of energy storage are taking on a new complexion. Increased emphasis on large and sometimes untried forms of energy storage is being generated by: (1) The uncertainties we face concerning future oil and gas supplies. (2) The growing need for the storage of peak-shaving energy on large utility systems. (3) The growing volume of highly toxic and energy generating wastes resulting from nuclear power plants. Concurrent with the growth of these pressures, legitimate environmental concerns now demand that the methods of storage which are utilized meet adequate criteria of safety and preservation of surface land, as well as fulfilling technical and economic functions. From these elements, increasing awareness has grown of the potential role that can be played by underground space in providing a storage medium for energy related materials. The vessels which must be built for underground energy storage will be built by the tunnel engineer, and the design requirements of such vessels will go far beyond the classical tunneling requirement to drive a stable, reasonably dry tunnel between two points. Depending on the nature of the material to be stored, the manner in which the storage is to be operated, and the specific risks to the environment which are involved, rock chambers must be designed as special purpose storage vessels. The tunnel engineer may be required to demonstrate that unusual pressure and temperature conditions can be sustained by the rock, or that containment of a toxic material can be assured. In certain cases there will be emphasis on

Jan 1, 1976

By R. G. Coyle

This paper describes a model of operating policies in an underground metal mine. The purpose of the model is partly that the problem of controlling a mining operation in the face of shocks from its economic environment is interesting in its own right, and also as an input to a larger research project on policy-making in mining companies. The model includes, mining, development and milling sectors together with cash flow and finances. In particular, it shows how the policies used to control the various sectors in the face of environmental shocks from metal prices and changing state of the system are connected by feedback loops. The use of feedback theory differentiates the model from 'ordinary' simulation and assists in the design of 'robust' policies which always achieve effective control. This model is the first stage of a major project and approximations have been made, simply to get the model going. The purpose of this paper is to show the kind of output this type of model produces, to lay our explicitly what is in the model and above all, to invite contributions from mining people on what the model should show and what should be put into it. We claim no virtues for this model. It is just a research tool so that later models will be more worthwhile and useable in practice.

Jan 1, 1977

Part two of this three part series looks at explosives use in open-pit and underground mining operations. Part three, next month, will discuss the transportation, storage, handling, and destruction of explosives. Larger ore bodies, lower grade deposits, and more difficult geologic conditions have led to changes in blasting products, techniques, and field practices in both open-pit and underground metal mines. Pit blasting operations must consider the material's geology, needed fragmentation for the material, and hole diameter and depth-as well as the traditional consideration of the type of explosive used. With underground mines, various blasting aspects of burn, angle, and machine cuts must be considered for an efficient and safe operation. Of the factors related to open-pit blasting, geology of the material is most important. Many theories relating to sonic velocity and rock hardness are used to determine needed explosives ratios. Extensive field tests are necessary to determine these factors. In most cases, results assume that the material to be broken is homogenous. The drilling penetration rate is sometimes used as a guide to determine rock hardness; however, this is not necessarily a good idea. In many cases, a very hard, brittle rock will blast with less difficulty than a soft, spongy rock. The formation's stratification is also important. In thinly laminated horizontal seams, rock will usually break and adequately fragment with relatively large burdens and spacings using a low explosives ratio. Massive formations with few laminations require close burdens and spacings and a high explosives ratio. When the stratification is pitched on a severe angle, it is usually preferable to develop the pit face 90°-but no less than 45°-to the stratification. If the face must be developed parallel to the stratification, burdens and spacings must be reduced and the angle drilling that will conform to the angle of the lamination should be given serious consideration.

Jan 8, 1981

By George Dogbe

Open pit optimization forms the basis of mine design, production planning and construction of mine facilities. The negative effects of this phase may include substantial reductions in ore recoveries, relocation of waste dumps and surface infrastructure, extraction of unwanted waste, with a cumulative effect on mine value reductions. As a result, this area has received significant research focus using linear and dynamic programming, heuristic, genetic and stimulation algorithms and the graph theory. These algorithms are derived from rigorous mathematical models, but they are built on the assumption that all the periodic production capacities are extracted at the time of analysis. This assumption weakens the models because mining occurs over significant time period. In order to develop a comprehensive model that accounts for the timing of material extraction, the current models, which are built on the economic block value (EBV) concept, must be modified to account for time. In this paper, the authors develop a model of the optimization problem using the 2-D Lerchs-Grossmann?s optimization algorithm. This model is used to investigate the effect of periodic discounting on the optimal pit layout design by designing an integrated pit optimiser (IPO) that incorporates ?production scheduling?. IPO uses the ensuing discounted economic block value (DEBV) as a basis for the pit optimisation process. The time-dependent model is compared with a time-independent model. The results show that discounting has no effect on the optimal pit contour although the reported pit value is overstated if the EBVs are used instead of the DEBV. The authors, however, believe that this conclusion may not be general and could have been influenced by the nature of ore body geometry and the proposed mining strategy.

May 1, 2004

ANNUAL MEETING OF THE NEW YORK SECTION - The annual meeting of the New York Section was held at the Machinery Club, May 7. While the dinner, at which fifty attended, was in progress, the names of the nominees for next year's officers were posted. The result of the election was as follows: Chairman, E. P. Mathewson; vice-chairmen, William Y. Westervelt, R. M. Atwater, Jr.; treasurer, Wilber Judson; executive committeemen, Lucius W. Mayer, Edwin S. Berry. The subject for the evening was "Organization and Campaign in France of the 27th Engineers." Colonel O. B. Perry described the many difficulties surmounted, for it was necessary to work with untrained men ALLEN H. ROGERS WALTER S. DICKSON CHAIRMAN OF NEW YORK SECTION SECRETARY OF NEW YORK SECTION and shortage in supplies. He described the unusually fine character and physique of his officers, which made it possible to make the untrained men most efficient. He described in some detail the work of building bridges over the Meuse River and the bringing up of supplies to the first army base, in particular at the Argonne-Meuse sector; General Pershing gave a personal commendation of the work undertaken by this regiment. The Colonel described the methods of operating the transportation of ammunition and supplies to the "army dumps," by which at the time of signing the armistice there had been brought up 600,000 tons of equipment for use in the projected campaigns. An interesting item was that 3,600,000 sand bags had been provided, in case the Germans should be able to turn the line of the American troops. Captain Edwin S. Berry described the methods of sending materials to the front lines and gave figures to indicate the huge quantities required, adding that the order of preference was troops, ammunition, food, and engineers' supplies. The speakers then answered several questions given by the members present. WALTER S. DICKSON, Secretary.

Jan 6, 1919

The truly scientific method in the study of such questions at the present day is the reverse of that which was followed in the early days of geology, when after the observation of a few isolated facts, some great geological mind was led to a general theory, and humbler followers were only too apt to do mild violence to nature in order to make her facts conform to it tt accumulates year after year a multitude of facts of patient observation, supported by studies with the microscope, and in the laboratory, avoiding general theories, and only making such deductions in regard to locftl conditions as are supported by the overwhelming evidence of facts. S. F. Emmons, on the geological distribution of minerals in the United States, at the "world's congress" of mining engineers, Chicago. Fig. l.-This exhibits the general stratigraphical characters of the southern lodes. The" Indicator" veins, the great barren lode masses, a later fissure than all of these (" B "), and the auriferous lodes of last series cleaving the wrinkled terraces and the older lodes also are" Indicator" veins. B is a later formed vein that leaves no " depositions" behind. ooe are fragments of the" most ancient'' lode wreckage. Db are the auriferous lodes and correspond with those lodes, also whose auriferous characters are not result of secondary impregnations.

By Vladimir G. Kochnev

"Autogenous and semi-autogenous grinding (AG and SAG) have been considered a step forward in comparison to conventional grinding circuits with several stages of crushing and using ball (and/or rod) grinding mills. However, existing AG and SAG technologies still can be improved and have an immense potential from the viewpoint of economic benefits.Experience gained by the Technics & Technologies of Disintegration Ltd. (TTD) in the research of grinding processes shows that comminution in AG and SAG mills can be performed in a more effective way. The company’s approach comprises the following elements:- Novel mill design- New liners and lifters- Novel discharge grid design- Technique of treating material of critical particle sizeA novel mill of the cantilever type capable to operate in the AG and SAG mode has been developed. The cantilevertype mill has a high diameter to length ratio, which dramatically increases the throughput rate, and is characterised by high reliability, fast installation and low capital and operating costs.Tests of the new heel-shaped liners, originally aimed at improving the intact condition of diamond, indicated that they play an important role in the grinding process. Tests performed by TTD jointly with ALROSA, MINTEK and Anglo-American Corporation, demonstrated that the heelshaped liners provided the increase in the throughput rate varying from 30 to 80 % and the decrease in power consumption in the range 30-55 % for grinding of kimberlite and platinum-containing ores.Investigation of the influence of the main grid parameters on the efficiency of grinding led TTD to a special design of a mill discharge grid, with a radial location of openings, the slot width varying from the periphery to the centre and the grid surface provided with “heels”. The design allows one to control the particle size distribution of the ground product without affecting the grid throughput rate."

Jan 1, 2003

By Jakub Nalaskowski, Robert Aranowski, Jan D. Miller, Jan Hupka

The polyolefins, mainly polyethylene and polypropylene particles, are used as an active filler material in polymer-polymer blends and are being used for the modification of asphalts to pro- vide for high-load, low-maintenance road construction. The stability of prepared blends depends on the interaction forces between polyolefinfiller and the matrix and/or between two polyolefin filler surfaces in the polymeric matrix. Various additives, especially surfactants, can be used to modify these interactions and improve the stability of polymer blends. In current research, direct force measurements between polyethylene (PE) surfaces in n-tetradecane, a nonaqueous solvent imitating the polymer matrix, were performed in the presence of lauric acid and dodecylamine using the AFM colloidal probe technique. Additionally, the zeta potential of polyethylene particles in the presence of surfactants in n-tetradecane was measured. The interac- tion forces between the polyethylene surfaces can be described as a combination of electrical double layer repulsion and steric repulsion between polymer chains extending into the n-tetradecane sol- vent. The addition of surfactant to the n-tetradecane was found to increase the repulsive force between the PE surfaces. The strongest repulsion was observed for dodecylamine. Additionally, the temperature efect on the interactions in n-tetradecane was studied. It was found that steric repulsion between the PE surfaces increases with an increase in temperature.

Jan 1, 2003

By William Kranz

THE increased service demands on some of the products of the National Malleable Castings Co. prompted it about eight years ago to investigate the electric furnace, both in America and in Europe. The process bad' already been sufficiently developed in Europe to lead us to believe that the electric furnace would most nearly meet our requirements. After further investigation and consultation with the highest authorities on the subject, we decided upon the Heroult type as the simplest and most practicable. In 1910, we built a furnace of this type, of 300 lb. capacity, for experimental purposes, and although it was crudely constructed the quality of the material we were able to make justified the installation of a 6-ton Heroult furnace in 1912. This furnace has three electrodes, 17 in. in diameter, uses three-phase, 60-cycle current, and is equipped with Thury regulators, which give us good regulation and a uniform load on the line even when cold melting. The power factor of the furnace is 94 per cent. Since July, 1912, the furnace has been in continuous operation, producing up to the present time, over 20,000 tons of both carbon and alloy steels of varying analyses and of exceptional quality. Both cold-and hot-metal charges have been used, with a power consumption of about 150 kw-hr. per ton in the case of hot-metal charges and from 500 to 600 kw-hr. per ton in the case of cold charges. The electric energy consumed varies according to the final analysis of the steel and the amount of refining required. Too much cannot be said about the refining possibilities of the electric furnace, for no other method of steel manufacture can compete with the electric in this respect.

Jan 5, 1915

By R. G. Koelmans

In 2001 Platinum overtook gold in foreign revenue earnings for South Africa. The export sales from platinum group metals amounted to R29.3 billion as opposed to gold export sales of R28.6billion1. Organizations must undertake new ventures to replace old, worn-out and obsolete assets with new ones. These assets could be a building, a new product or process, a new mine, or anything that can help the organization to achieve its objective. These ventures are projects by their nature. When a project is pronounced a success, the judgement is usually based on some factual evidence, although not every one uses the same data. From the literature, it is obvious that there is a lack of consensus and objectivity as to what constitutes a successful project. The purpose of this paper is to address the following questions: ?What constitutes a successful project? ? How does one measure project success? ?How can one work toward project success? This paper addresses the requirements for project success of three of the primary stakeholders of a project, namely the business or client, the employees as far as the project team is concerned, and the local community. Indicators are developed into a work breakdown structure (WBS)-like chart to demonstrate success indicators. These indices take cognisance of all the constituents required for project success. The indicators are further developed to take cognisance of the requirements of the local communities. These indices are then weighted to arrive at a total score for the respective stakeholders. Using these WBS models, the success and performance of a project can be evaluated. This score is considered an objective measure of project success. Projects are evaluated more consistently across different projects and the project manager is provided with a management tool that can assist him/her in ensuring greater project success. The shortcoming of this approach is that the weights of the different indices have been estimated at this stage. Research will have to be conducted to more accurately reflect the weights assigned to the indices.

Jan 1, 2004

By Ronald E. Heuer

The significance of surface settlement over soft ground tunnels is well recognized. Cracked buildings, streets transformed into lakes, broken utility lines, to underpin or not to underpin--all are familiar problems. The basic causes of surface settlement are recognized. Possibly the most common and troublesome cause is "lost ground" during construction. Lost ground refers to removal of a larger volume of ground (Ve) than is eventually occupied by the final tunnel structure (Vt). A number of sources of lost ground in shield tunneling have been identified, as illustrated in Fig. 1. These include 1) face loss, 2) overcutting loss, 3) annular tail void loss, and 4) loss through the lining. The ground generally does not stand unsupported around the completed tunnel lining as illustrated in Fig. 1, but moves in to fill the lost volume, resulting in subsidence of the overlying ground surface as shown. As suggested in Fig. 1, lost ground and surface settlement associated with overcutting and the annular tail void tend to occur systematically along the tunnel length. This "systematic" lost volume is "limited" in the sense that it is restricted to an upper limit determined by the shield and lining geometry. Partially controlled face loss may sometimes contribute to this systematic loss. This lost volume is commonly a few percent of the nominal tunnel volume. The resulting surface settlement over the tunnel is commonly in the range of a few inches or less and develops over a period of hours to days. Although they may have a significant impact on surface facilities, systematic ground loss and settlement frequently have little adverse effect on tunneling progress.

Jan 1, 1976

By Joseph M. Tarantino, Eric F. Perry, Keith B. C. Brady, Michael W. Smith

The Pennsylvania Department of Environmental Protection in 1998 reviewed its permitting process to determine how effective its program has been in preventing pollution and to identify here it could be improved. Of the 1,699 bituminous mine permits issued from 1987 to 1 996, 50 were identified to have current or past postmining discharges with water quality problems. The remaining 1,649 sites had no known current or past postmining discharges problems. The 50 sites were selected for further review. On closer examination, 33 of these permits no longer had water quality problems or the problem had not actually resulted from the permitted mining activity. Only 17 permits, or one percent of the total permits issued, were found to have caused long-term postmining discharges serious enough to require treatment and prevent bond release. Analysis of these 17 sites using current knowledge of mine drainage prediction, revealed that the most common cause of error was inadequate information in the permit application. Errors in interpretation of the application data and in implementing the permit were less common. A very small percentage of all permits issued resulted in postmining discharges for no clearly identifiable reason. Trends over the 10-year study period indicated a decreasing incidence of permits resulting in postmining discharges. Further, with the exception of the first few years of data, most of the postmining discharges were of mildly acidic or alkaline quality and amenable to passive treatment.

Jan 1, 2000

By Robert F. Baker

Neanderthal technology is a harsh and inaccurate way to describe modern underground construction and mining practices, but such an exaggeration helps to focus on a major problem or wasted opportunity of modern society. Why is it not safer to excavate in the underground? Why are the working conditions still so unfavorable? Why are urban freeways, shopping malls, warehouses, power plants, sewage disposal treatment plants, and similar facilities still constructed on the surface of the ground--because it is a better location? On the contrary, if underground technology made full use of existing knowledge, underground resources and space would be much more effectively used. And why is the technology so inadequate? Certainly, researchers and practitioners are aware of the shortcomings and are equally aware of problems that have to be overcome. One of the most important reasons has to do with the type of policy goals that society has set in the past. Policy makers may have agreed that improvements would be desirable but no serious commitments have been made--that is, there has been no major allocation of resources to advance these technologies. And yet, to bring about significant changes will require significant time and resources. The resources that are needed are far in excess of what industry can afford to invest, particularly since the pay-off may be far in the future. So the problem reverts to society in general. As long as society is willing to tolerate the present costs and safety requirements for recovering minerals and for constructing underground facilities, then the changes will be slow in coming. Until such time as society sees and desires the benefits

Jan 1, 1974

By H. N. Lawrie

This study was undertaken on account of the lack of definite knowledge concerning the influence of bismuth on wire-bar copper, and the small elimination of bismuth from copper-matte during the smelting-operations. The early workers who studied the influence of bismuth on copper confined their investigations to malleability and ductility—two physical properties which are related to the others so intimately that their determination is of primary importance. Karsten and Levo1,² using bending- and mealleability-tests, seem to have been the first to take up the subject, and while their results are incomplete, they agree in the main with the later work of Hampe.3 The bending-tests used by the first investigators consisted in bending the specimen until it failed. The malleability-tests were made by beating the material to a knife-edge with a hammer. Hampe not only determined the percentage of bismuth which would cause red-shortness and cold-shortness of the alloy, together with other influences of bismuth on the malleability and ductility of copper, but also took up the influence of the bismuth protoxide, BiO, on copper, and of bismuth sesquioxide, Bi,O,, on the copper protoxide, CuO. Hampe's conclusioris of the influences of these two latter compounds of bismuth on copper are as follows : "If the protoxide of bismnth be alloyed with metallic copper, it is not changed to metallic bismuth, but remains mechanically distributed throughout the copper.

Jan 1, 1910

By David Segura

THE Huitzuco mercury deposits have been described by C. W. Vaupell,1 therefore the general information such as location, history, production, etc. will not be repeated here. The present owners acquired the property when the deep levels of the Cruz mine were flooded, and it was believed that a relatively large tonnage of low-grade ore and fills would be encountered in the flooded section, because f the early mining methods used in the Cruz mine. The mine was partly unwatered and about 187,000 tons of fills was pit-sampled in the San Cayetano stope. These fills average 2.4 kg. Hg per. ton. During the period of maximum production at Huitzuco, the ores were sorted in the mine and cobbed into 3-in. pieces, which were treated in Scott furnaces. Large pieces of raw ore are found in the sinter, and it is indicated that both recovery and, costs were not very satisfactory. Recent practice has been to treat the ores in closed retorts made of 10-in. pipes. Because f the presence of combined antimony in the mineral livingstonite (HgS.2Sb2S3) and considerable native sulphur, little or no metallic mercury is recovered in the condensers and a second retorting of the condenser muds is-necessary. This makes the treatment of the ores expensive and tends to low recoveries of mercury. The prin-cipal costs of retorting are, in their relative order: (1) fuel, (2) low recov-ery of mercury, (3) replacement of retort pipes, (4) labor.

Jan 1, 1938

By M. H. Moys, H. Dong

"Discrete Element Method (DEM) has become a standard tool to simulate grinding mills in order to gain information about load behaviour, power drawn, etc. However, parameters necessary to run a simulation are not always readily available. For example, the coefficient of restitution used in DEM simulation from the literature ranges from 0.1 to 0.9 due to lack of accurate values. The lack of correct input parameters results in the fact that some simulation parameters are adjusted to match the simulation prediction with the experimental results. It is inappropriate to tune one single parameter arbitrarily in order to fit the prediction with experimental results. The correct value of parameters for DEM simulation should be established, and rigorous validation on simulation results by DEM needs to be done.The objectives of the ongoing project are to measure the coefficient of restitution at conditions analogous to grinding practice. Equipment has been built to measure the coefficient of restitution. A typical case of impact test showing the vertical position of a ball as a function of time is presented in Figure 1. The coefficient of restitution between steel ball of different sizes and the targets including steel liner (e = 0.91), mild steel block (e = 0.57) and rubber liner (e = 0.7) have been measured. The coefficient of restitution reduces to 0.38-0.52 when there is a layer of coal particles (1-2 mm) on the steel liner. The effects of ball size, drop height on coefficient of restitution are investigated. Then a DEM code is developed of several contact models to simulate the impact process. This code can reveal details on velocities (translational and rotational) and forces (normal and tangential) during the brief impact interval. Figure 2 is a comparison of the rebound rotational velocity between experiment and prediction by different models. The results can be used as DEM input and to assess contact models."

Jan 1, 2003

By D Ryan

Following a long period of increase, there has been a reduction in exploration expenditure and activity in Australia over the past two years. During the post Second World War period, exploration was largely driven by mining companies seeking resources to satisfy an increase in world demand, while increasing their asset base as a result of mineral discoveries. In general, return on investment to shareholders was not the major driving force. With the exception of gold the mining industry has been faced with a long-term fall of metal prices in real terms. As a result the net profit return on average shareholderÆs funds in the Australian minerals industry has fallen from over 20 per cent in 1990 to less than five per cent today. Mining is now competing for funds with communication and finance based industries yielding high returns on shareholder investment. Shareholders and superannuation fund managers seeking a high return on short-term investments have indirectly reduced the funds available to the mining industry. Globalisation of the mining industry is leading to the rationalisation of the Australian mining industry as witnessed by mergers and acquisitions of local companies by foreign investors. The return on capital invested in the Australian mineral exploration industry must improve if the industry is to be competitive on a worldwide basis. Failure to achieve this will result in capital flowing overseas or to other industries. Relatively short-term upswings in metal prices which are generally driven by threats to the supply base (eg strikes, mine closures, increases in country risk) often lead to increased capital raisings for exploration funding. As a consequence of the time taken to raise the capital and increase exploration activity, measured exploration activity lags the metal price increases. There are also lags between commencement of exploration and discovery and ore production. In the case of gold exploration expenditure peaked six years after the price rise of 1980 Companies persevering with exploration in the current difficult period will be rewarded because they will be able to capitalise on future metal price rises and a minimised time lag.

Jan 1, 2000