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By A. V. UDELL

OF all the metals that have from time to time been called the "Wonder Metal," mercury, often called quicksilver, is probably the most deserving of this designation. A wonder metal it must have been to those workers of an earlier day who named it after that Latin god of commerce and gain, characterized as the fleet messenger of the gods and the conductor of souls to the lower world. The word mercury has been used to indicate a carrier of tidings, a bearer of news, a nimble or clever person, a hawker, and a skillful thief. All of these attributes, and more, are recognizable in this metal, the technical terminology of which is "Hydragyrum," meaning water-silver, and from which the chemical symbol "Hg" is derived. Fickle in its occurrence in nature, simple in its metallurgy, illusive in captivity, it serves man in life or death, in war or peace, in commerce, science and arts, in mining, agriculture, and forestry with a versatility found in no other element.

Jan 1, 1929

By J. F. Shirley, H. K. Burke

In January, 1964, three years of laboratory and pilot plant test work reached its culmination. The San Manuel Div. of the Magma Copper Co. switched its molybdenite extraction circuit from the sodium hypochlorite-ferrocyanide process to the new process described in this paper. The San Manuel Div. Concentrator of the Magma Copper Co. is located near San Manuel, Ariz., approximately 45 miles northeast of Tucson. The concentrator treats approximately 35,000 tons of ore per day containing about 0.85% copper and 0.025% molybdenite. The San Manuel ore body is a disseminated copper deposit in quartz monzonite and quartz monzonite porphyry. The primary copper mineral is chalcopyrite; minor amounts of chalcocite, bornite and covellite are also present in varying degrees. Pyrite makes up somewhat more than half the sulfide content of the rock. The molybdenite is nearly always found on fracture faces or associated with quartz veinlets.' On January 9, 1964, the sodium hypochlorite-ferrocyanide process that had been used for molybdenite recovery was replaced by the following process: 1) A conditioning step with hydrogen peroxide, sulfuric acid, sodium cyanide and zinc sulfate. 2) A two stage rougher flotation step with stove oil and sodium ferrocyanide. 3) One cleaning step with sodium ferrocyanide. 4) One cleaning step with sodium hypochlorite and potassium ferricyanide. 5) Four cleaning steps with an anti-foam Exfoam 636 and potassium ferricyanide. COPPER CONCENTRATOR Since molybdenite recovery is closely allied with previous steps in the operation, the copper concentrator will be briefly described first. The ore is ground to approximately 5% plus 65-mesh and 65% minus 200-mesh in a two-step grinding circuit consisting of rod mills in open circuit and ball mills in closed circuit with rake classifiers. A straight forward rougher circuit producing only one concentrate is used. The rougher concentrate is combined with the discharge from the regrind ball mills and is then cycloned, with the overflow going directly to the cleaner circuit and the underflow going to the regrind mills. The feed to the cleaner circuit is approximately 90% to 94% minus 325 mesh. The cleaner circuit consists of two stages in which the tailing from the final cleaner stage is returned to the primary cleaner and the primary cleaner tailing is returned to the rod mill discharge at the head of the circuit. Approximately 0.013 lb of the allyl ester of amyl xanthate (S-3302) per ton of ore is added to the rod mills and approximately 0.006 lb of sodium isopropyl xanthate (2-11) per ton of ore is stage added down the rougher banks. The frother used is methyl iso-butyl carbinol (MIBC) and it is added at various points in the grinding and the rougher flotation circuits. Lime is added to the ball mills and/or to the rod mills to maintain the desired pH in the rougher flotation. The rougher flotation has been operated at various pH levels between 10.5 and 11.5. Fuel oil is added in the regrind mills at a loading of approximately 0.01 lb per ton of ore. Factors Which Directly Affect Molybdenite Recovery: It has been found at San Manuel that, to obtain maximum molybdenite recovery, an oily type flotation collector must be added in the grinding circuit. When molybdenite is crystallized in the characteristic platy form, which appears to be the case almost all of the time at San Manuel, its surface has a greater tendency to adhere to oils than water. 2 Of the several oily type collectors available on the market, the allyl ester of amyl xanthate seems to be the best molybdenite promoter. The floatability of San Manuel's molybdenite does not appear to be affected, at least up to a pH of 11.5, by lime. It has been reported that at several plant operations high lime alkaline circuits have adversely affected the molybdenite recovery.3,4 It has been found through microscopic studies that the bulk of the chalcopyrite will float before the molybdenite in both the rougher and cleaner circuits. It is necessary to add fuel oil to the regrind mills to enhance the

Jan 1, 1965

By W. E. Horst

Flotation feed was hell constant for batch laboratory tests and continuous pilot and commercial plant tests on a spodumene ore to determine the relation.ship between flotation behavior and the size and type of flotation machine. Results. showed that additional retention time would be needed in the plant flotation circuit to duplicate laboratory or pilot plant performance when operating Dariables of the. plant flotation machines remained unchanged. During the past few years of operation at Kings Mountain, N. C., full-scale flotation has generally yielded poorer metallurgical results than those obtained in the laboratory or pilot plant. After 2 min in each size of Denver flotation machine in the spodumene rougher circuit, pilot recovery (41.7 pct) was almost three times that of the plant (13.6 pct) and about twice that of the laboratory (21.0 pct). Pilot and commercial plant data are based on continuous operation, and laboratory results on batch testing of rougher performance. The ore is a pegmatite containing spodumene, feldspar, quartz, mica, and amphibolite. Data were accumulated to evaluate the scale-up relationships between laboratory, pilot plant, and plant flotation cells. Flotation rate constants and dimensional analysis were used to define the relationship existing between flotation behavior and scale of operation. Measuring Flotation Rates: Efficiency of the rougher stage was measured by flotation rate, defined as the recovery that can be attained within a given time." • The problem of measuring flotation rates has been studied by many investigators, whose methods have varied. Published studies an flotation kinetics have been summarized recently by Gaudin.l When comparing flotation rates, it is more satisfactory to compare straight line relationships between recovery and flotation time than exponential curves resulting from plotting cumulative recovery vs cumulative flotation time. To convert the exponential curves into straight line relationships, rate equations were applied similar to those used in chemical kinetics to study the velocity of chemical reactions. Two rate equations have been used in this investigation to measure efficiency of the various cells: 1.5 order Rate Equation dR/dt=k (A-R)1.0 [Eq.1] Second Order Rate Equation dR ---- - K(A - R)2 [Eq. 2] dt Upon integration Eq. 1 becomes 1/(A-R)1/2=k/2 t+1/A1/2 [Eq. 3] and Eq 2 becomes: or fEq. 4] t/R=1/A2K+t/A [Eq. 4] where R = cumulative recovery [percent recovery of total value (spodumene) in flotation feed]. A = initial concentration, pct (100 pct of mineral to be separated). t = flotation time (minutes). k = flotation rate constant for 1.5 order rate equation [units: 1/(percent) 0.5 (min)1. K = flotation rate constant for second order rate equation [units: 1/(percent) (min) 1.

Jan 1, 1959

By Edmund J. Korber, Donald E. Raab, Frank A. Burns

During the early 1960s, the advent of self- advancing longwall roof supports triggered serious consideration by Bethlehem management to introduce the technique of longwall mining at one of our central Pennsylvania coal mines. Although longwall mining was initially justified as a means to cope with the severe roof conditions at our Mine 32 (Watson, B., 1971), the result of the endeavor has been a consistent and reliable level of coal production, first from Mine 32 and then later from Mine 33, over a period of fifteen years. Longwall production from the Cambria Division has been the mainstay of the low volatile coal required by Bethlehem Steel for steel production. Let us review the events that led to this accomplishment, as well as where we stand today.

Jan 1, 1981

By John Wellington Finch

WHAT is an engineering opportunity? To the mining .engineer the natural assumption is that the first requisite 'is a mineral deposit, but, of course, it is not so simple as that. There are at various points on the earth really very great mineral deposits which, on account of geographic location, backwardness of the country, or hostility of its natives, are now, and for a long time to come will be, quite valueless. The mining engineer, and for that matter the civil engineer, is more dependent upon the decisions of capital than upon any other factor in his profession. Ordinarily it is to be assumed that money will go to any place where it is clear that an adequate return upon its investment can be secured, but for many years it has not been safe to depend upon this. ' As already stated, there are many places where local conditions are such that mining is not safe to engage in and there are still other places in which conditions have been so aggravated by the Great War and by the social unrest which has upset the Asiatic region that capital is naturally most reluctant to venture, even when engineering data makes the undertaking appear attractive. It will be evident, I. believe, that there are many factors vital to the success of a mining enterprise in some of the remote countries which we do not have to consider in the United States and which do not, in fact, exist here.

Jan 1, 1924

By John Wellington Finch

THE- impression which the public has of northern Canada is that it is a' vast wilderness of forests; river's, and. lakes, sparsely inhabited by. a few Indians and `containing a few, scattered trading posts of the Hudson Bay Co. This is far from the facts. The building of the Canadian Pacific Railway led to the discovery, in 1883, of the nickel deposits of Sudbury, Ont.; these are the largest known nickel deposits in the world and produce about 90 per cent. of the world's output of nickel. The building of the Temiskaming and Northern Ontario Railway north, from North Bay, to open up farming lands along Lake. Temiskaming, resulted in the discovery and development of the great silver deposits of the Cobalt area, Ontario. Since the discovery of these deposits in 1903 to Dec. 31, .1923, Cobalt has produced a total of ' 327,301,897 oz. of silver, valued at $212,668,434, and paid in. dividends $88,338,185. In 1923 the production of Cobalt amounted to 10,285,247 oz. of silver. Just south of Cobalt, in South Lorrain,. a. new silver district has recently been developed and mills have started production. These deposits are of such extent that 'a branch railroad is under construction from Cobalt to that area. Northwest of Cobalt is the Gowganda silver area which is also a producer of silver ore and is now attracting outside attention. This area is not connected by railroad.

Jan 1, 1924

By G. D. Marshall, D. K. Sarin, V. E. Hampton

Ground support at the Thompson Mine emphasizes scaling, rock bolting and wire mesh screening on the backs and walls of all underground stoping and development areas and also full column grouted cable bolting in the bulk mining areas. This paper describes the equipment for the point anchored rock bolts as well as the full column cable bolts. Modifications in design and testing of all components and procedures has ensured a safe and efficient method of ground support for the mining conditions existing at the Thompson Mine.

Jan 1, 1983

By Messervey, J. P.

NOVA SCOTIA is sharing in the rapid advance of the mining industry that is one of the remark- able features of Canada's recent progress. The production of coal and gypsum has increased rapidly, and there has also been a marked development in the mining of gold, salt, zinc, copper and other minerals. Coal, the basis of the principal mining industry in the Province, was discovered by the early explorers on the shore of Cape Breton Island, and used by the garrison at Halifax as early as 1749. The first government record shows total annual sales amounting to 1668 long tons in the year 1785, while last year production was 6,643,000 long tons. The principal mines are discussed in a separate paper by Alexander L. Hay1.

Jan 1, 1928

By Luther M. Krupp

A 3 ½ -mile asphalt mixed mat haulage road joins American Smelting & Refining Co.'s El Tiro copper pit northwest of Tucson and its Silver Bell mill. Two-axle trucks operate continuously over the road- way but the asphalt top shows none of the wash- board wear usually seen on dirt haulage roads during use by heavy vehicles. The following data cover construction of this road, and results of its use by Asarco and Isbell Construction Co., the road's builder.

Jan 11, 1958

Edward K. Landis, Philadelphia, Pa.: In studying Mr. Thackray's paper it seemed that a critical comparison of the results from different methods therein reported would he of interest. For this purpose Table I. was constructed by grouping all determinations made by the same method, and the probable errors were calculated. In this table all chemists titrating with permanganate (A1, E, F, G and 0 of Mr. Thackray's paper) are classed under "Emmerton;" those titrating with nitric acid (C, J, S and Y) under " Handy; " those re Probable error of result: a, ±0.0008996; b, ±0.000694; c, ±0.00107; d, ±0.00115; e, ±0.000674; f, ±0.000473; g, ±0.003675; h, ±20.0007959; i,0.000.5098; k, ±0.0008303. Probable error of single determination: a, ±0.001989; b, ±0.001547; c, ±0.00214; d, ±0.0023;e, ±0.00116;f, ±0.000818;g, ±0.0019;h, ±0.00224; i, 40.00143; k, ±0.00234. The formula for calculating the probable error is 0.6745, where N (N— 1)' S is the sum of the squares of the differences from the mean and N is the number of determinations.

Jan 1, 1897

By K. N. Han, H. Lee, M. C. Fuerstenau

An investigation of the recovery of finely-divided cassiterite and silica particles less than 1 µm (1200 mesh) in size has been carried out using packed and fluidized beds. The bed particles used included cassiterite and silica particles ranging from 44 to 210 µm (325 to 70 mesh). Effects of various system parameters on the recovery and selectivity of cassiterite fines were investigated. System parameters included pH of the slurry solution, superficial velocity, slurry concentration, and bed particle sizes. High recoveries of cassiterite fines were obtained at pH 4.0 and slow slurry flow rates. In a packed bed system, recovery of cassiterite fines was greater than 95%, while that of silica fines under the same conditions was about 35%. Although the total recovery per pass is not as good as the packed bed, the fluidized bed system exhibits good recovery in general and an excellent selectivity of cassiterite fines. There is an optimum superficial velocity, vo, for the rate of fine particle uptake and the apparent rate constant has the form of Kvo1/2- K'vo, where K and K' are system constants.

Jan 1, 1985

By K. E. Starling

Phase equilibria data were used to develop an equation-of-state correlation for complex hydrocarbon mixtures, thereby circumventing difficulties associated with use of pressure-volume-temperature data. Equilibrium phase data for two condensate reservoir fluids were used to determine equation-of-state parameters for hydrocarbons as heavy as C22H46 in a modified form of the Benedict-Webb-Rubin equation of state. Comparative tests of K-values from the resultant correlation were made with data for condensate reservoir, separator and gas plant absorber mixtures. Generally, for temperatures above OF and computed liquid densities below 0.55 Ib-mole/cu ft, the modified BIVR equation predicted K-values in close agreement with the experimental data. INTRODUCTION Accurate predictions of thermodynamic behavior for complex hydrocarbon mixtures are necessary for many calculations in the petroleum industry. Because of the relatively high cost of extensive experimental data, many correlations for prediction of phase behavior have been developed. Some of these, such as the correlation of K-values presented in the NGAA Equilibrium Ratio Data Book, are totally empirical.l Others, such as the Benedict-Webb-Rubin (BWR) equation-of-state method, are semitheoretical.2-4 Unfortunately, published correlation methods often do not accurately predict the phase behavior of complex hydrocarbon mixtures, principally because of inadequate representation of the effects of components heavier than decane. This paper presents a new approach to this problem in which basic equation-of-state relations including heavy hydrocarbon effects are applied. Equilibrium phase data for two condensate reservoir fluids containing hydrocarbons as heavy as C22H46 are used to correlate component K-values. The BWR equation was chosen as the prototype equation of state for this study because of its proven capability for accurately predicting phase behavior and thermodynamic properties of light - hydrocarbon mixtures? Research was directed toward development of BWR parameters for the heavy hydrocarbons and modifications of the mathematical form of the BWR equation for application to complex hydrocarbon mixtures. The new equation-of-state approach presented differs considerably from previous methods in that phase equilibria rather than PVT data are used for determination of equation-of-state parameters. It is an explicit approach since the parameters are determined directly from mixture data. As such, it does not encounter problems inherent in the implicit method used by Benedict, Webb and Rubin 2-4 and numerous other investigators—one in which mixture parameters were postulated to be functions of the pure component parameters. The pure component BWR parameters, in turn, were determined from experimental PVT data. This method has been limited to mixtures containing components lighter than decane because of lack of vapor phase PVT data. Studies have been reported in which BWR parameters have been determined explicitly from PVT data for binary mixtures.6-8 However, since small concentrations of heavier components have only a minor effect on PVT behavior, it is doubtful that these explicit methods would yield useful results for condensate systems. Ellington and Eakin9 have shown that the accuracy of K-values predicted by an equation of state developed from mixture PVT data probably would be more than an order of magnitude lower than the accuracy of the PVT data. On the other hand, an equation of state utilizing parameters developed from phase equilibria data should predict K-values with accuracy comparable to the accuracy of the experimental phase compositions. This work applies this explicit approach with the objective of improving hydrocarbon mixture phase behavior predictions. Results are evaluated by comparing predicted and experimental K-values at reservoir, separator and gas plant

Jan 1, 1967

The following is an incomplete list of members and guests who called at Institute headquarters during the period June 10, 1919, to July 10, 1919. Anvil A. Anderson, Rapid City, S. D. Roy N. McBride, U. S. Army. R. Hay Anderson, Mexico City, Mex. R. S. McIntyre, Berkeley, Calif. W. A. Barnes, San Francisco, Calif. H. R. Maier, Brooklyn, N. Y. Bennett R. Bates, Denver, Colo. Wm. D. Mainwaring, Philadelphia, Pa. Harlan H. Bradt, Duluth, Minn. Wm. E. Milligan, Chrome, N. J. H. Brings, San Francisco, Calif. Willard S. Morse, Tacoma, Wash. Robert S. Burg, Ocean Park, Calif. Arthur Notman, Bisbee, Ariz. D. W. Butner, Congo Belge, Africa. P. Nugue, Chalon Sr. Saone, France. George A. Camphuis, El Paso, Tex. George A. Packard, Boston, Mass. Fred Canan, Denver, Colo. C. L. Petzel, New York City. Walter H. Coleman, Prescott, Ariz. V. Porreaud, Paris, France. Fred Crabtree, Pittsburgh, Pa. Fred S. Porter, Seattle, Wash. Ross E. Douglas, Rancagua, Chile. R. W. Prouty, Morenci, Ariz. F. A. Downes, Golden, Colo. Charles E. Prior, Brooklyn, N. Y. W. G. Eberhardt, Tucson, Ariz. Louis Ravicz, Minneapolis, Minn. Charles H. Fulton, Cleveland, Ohio. Wm. Reed, El Oro, Mexico. Wm. R. Grunow, New York City. E. J. Ristedt, Globe, Ariz. Orr R. Hamilton, Lansing, Mich. A. M. Rodgers, Middletown, N. Y. T. N. Havlin, St. Louis, Mo. J. C. Scoles, Salt Lake City, Utah. G. M. Henderson, Weston, Mass. C. E. Siebenthal, Washington, D. C.

Jan 8, 1919

By Bruce A. Kennedy

Lufthansa flight 497 roared down the runway and climbed rapidly through the early morning mist hanging over Pudahuel airport and the city of Santiago, Chile, into the brilliant sunlight above the clouds. As the plane banked onto course for Lima, Peru, we got what was possibly our last look at the beautiful snowclad mountains that ring Santiago. To the northeast was the massive hump of Aconcagua, the highest mountain in the Southern Hemisphere, wreathed in clouds and virtually looming over Rio Blanco, the new mine put into production by Cerro de Pasco just one short year before. Almost a thousand miles to the north lay the massive open pits of Chuquicamata and Exotica, and a little closer to Santiago the El Salvador mine. Behind to the southeast, clinging to the steep slopes of the Andes, was the large and awe-inspiring El Teniente mine at Braden. These mines, once the bastions of such companies as Anaconda and Kennecott, had a new owner-the Government of Chile. On the plane were a number of people who had spent a large part of their lives in Chile operating these mines and plants, and who now were suddenly faced with the necessity of starting new lives somewhere else. To them, this was their last look at the country which not too long ago was their home, a bittersweet moment of reminiscence and a time for questioning what the future held.

Jan 1, 1971

COLUMBIA SECTION Holds four sessions during year. Annual meeting in September or October. S. S. FOWLER, Chairman, J. C. HAAS, Vice-Chairman, LYNDON K. ARMSTRONG, Secretary-Treasurer, 720 Peyton Bldg., Spokane, Wash. W. H. LINNEY, J. F. MCCARTHY. A special meeting of the officers of the Columbia Section was held in Spokane, Wash., Jan. 10, 1918, for the purpose of organizing and nominating members to the principal committees of the Section. Present: J. C. Haas, Vice-chairman; W. H. Linney, Past Chairman; and L. K. Armstrong, Secretary. J. F. McCarthy, Wallace, Idaho, was appointed fifth member of the Executive Committee. The following were appointed to the Membership Committee: R. M. Betts; for Oregon; W. J. Hall, for Idaho; J. M. Porter, for Washington. A member for British Columbia will be appointed later. The following were appointed to the Committee on Papers: Prof. F. A. Thomson, Moscow, Idaho; Prof. L. 0. Howard, Pullman, Wash.; H. S. Lee, Rye Valley, Ore. A fourth member, representing British Columbia, is to be appointed later. The following members were appointed representatives on the Executive Committee of the Spokane Engineering and Technical Association: J. C. Haas, W. H. Linney, F. A. Ross, L. K. Armstrong. The Treasurer reported a deficit, resulting from the participation of the Section at the Northwest Mining Convention in 1916. It was recommended that the Institute be petitioned to make good this deficit, in addition to the usual annual allowance. The members of the committee who were present expressed their desire to be of greater service in the present war, and discussed at some length the possible means of carrying out their desires. It was later decided to reopen the subject at a subsequent meeting of the Section, or to present it to the Executive Committee of the Spokane Engineering and Technical Association for discussion and cooperative action. L. K. ARMSTRONG, Secretary.

Jan 3, 1918

By Colin J. Dixon

The full realization of the potential of computers in geological in- formation system demands new approaches to the machine representation of information. At the same time, the feasibility of such a system, particularly in commercial field, demands greater freedom in input preparation and a degree of standardization in the arrangement of subject matter system. The paper describes some of the basic notions of project "GEOSEMANTICA 70". The aim of the project is to devise means of storing real geological informations in a machine rather than the representation of the information in human language form. This is seen as the only long-term solution to the problems of the complex vocabulary of geology and the complex syntax of geological description. Effectively, a machine language is being defined, consisting of a set of symbols and a date structure for representation of geological and related information. Beyond this, is the definition of a set of rules allowing the use of constrained text as an input/output medium. The investigation is oriented primarily to the representation and handling of information about mineral deposits and the associated geographic, economic and engineering information.

Jan 1, 1969

By Paul F. Kerr

The insufficiencies of our mineral resources are becoming well known, and the national political conscience seems to be troubled at last by our dependence upon mineral commodities which must come from other lands. This realization places increased responsibility upon the industrial, educational, and governmental groups whose task it will be to solve the problems of mineral supply. As we all know, from the time that man first sought mineral deposits until recent years, prospectors have been largely responsible for mineral discoveries. Today the era of the prospector is almost over. The human ants that have literally examined all accessible outcrops and have tested the gravels of nearly all stream beds in the United States have left undiscovered few worthwhile mineral deposits within the scope of their recognition. The pages in the history of mineral exploration are now being turned from the era of the surface prospect to the era of the hidden de- posit.

Jan 1, 1949

By William P. Shinn

Jan 1, 1880

By J. L. SILSBEE

THE existence of large saline deposits in that flat arid basin, known as the Great Salt Lake Desert, has long been recognized, but the extent and great commercial value of these deposits has not been generally appreciated. That a very considerable interest has recently developed is indicated by the fact that about 263 prospecting permits-each covering about 2560 acres of land in this Desert-have been issued under the Potash Leasing Act (Act of 0ct. 2, 1917-40 Stat. 297), and patents granted on approximately 40,000 acres. It is reported that patents and leases have, or will be applied for on an additional 80,000 acres in the basin. , Tests have been made on probably less than 10 per cent. of the total area of the basin, but these have proved a practically unlimited supply of brine available -sufficient, probably, to. furnish the potassium and magnesium chloride requirements of this country for at least a hundred years.

Jan 1, 1925

By Kyle Wightman

INTRODUCTION CRA Limited is the largest mining group in Australia by value of sales and the second largest company in Australia in terms of share market capitalisation. In the past 25 years, CRA, its predecessors and affiliates have been involved in a number of mining and further processing developments in Australia and elsewhere. Many of these have been financed using project financing techniques. These include Comalco's development of the Weipa bauxite deposits in Northern Queensland in the late 1950's, the Hamersley iron ore developments in the Pilbara region of Western Australia in the mid 1960's, the Queensland Alumina Limited alumina refinery in Gladstone, Queensland, at about the same time, and the Bougainville copper project in 1969/70. In the past three years CRA has again utilised project financing techniques to fund its Tarong steaming coal project in Queensland, the Blair Athol steaming coal project also in that State and CRA's interest in the Argyle diamond project in the Kimberley region of Western Austrlia. PROJECT FINANCE DEFINED Nevitt Definition Nevitt's is the most frequently quoted definition - "A financing of a particular economic unit in which a lender is satisfied to look initially to the cash flows and earnings of the economic unit as the source of funds from which a loan will be repaid and to the assets of the economic unit as collateral for the loan." Risk and Balance Sheet Treatment It is important to focus in more detail on two aspects of project financing, risk and balance sheet treatment. The assessment of the various elements of risk in a project and the sharing of that risk between sponsors and lenders is the most critical feature. At one end of the spectrum is full absorption of risk by the sponsor(s). This can be described as "on risk" or "on credit" or "full recourse" to the sponsor(s) and is effectively a corporate financing. At the other end of the spectrum the lenders absorb the whole risk in a non-recourse financing which is "off risk" or "off credit" for the sponsor. The other aspect is the sponsor's balance sheet treatment. If the balance sheet of the economic unit undertaking the project and the financing need not be consolidated into the balance sheet of the sponsor (because ownership does not exceed 50%) then the financing may be described as off-¬balance sheet. If consolidation is required then the financing is described as on-balance sheet. Most project financings involve some recourse to the sponsor, i.e. they are limited recourse. Very few are non-recourse or off credit to the sponsor. Limited recourse financings may be on-balance sheet although many may also be off-balance sheet insofar as consolidation is concerned. However, sponsor support may very well be a contingent liability to the sponsor and require disclosure by way of note to the balance sheet should consolidation not be required. CORPORATE FINANCE CONTRASTED A financing which is on credit or full recourse to the sponsor, whether it is directly borrowed or guaranteed by that sponsor, is a corporate financing. Lenders will tend to base their credit assessment on a historical assessment of the sponsor's activities and its financial results rather than an assessment of the project or a detailed assessment of the future activities and prospects of the sponsor. PROJECT FINANCE - A BORROWER'S PERCEPTION Although CRA could choose to arrange all finance on a corporate basis (except perhaps for the very largest projects or acquisitions), project financing techniques provide a number of specific advantages which CRA has noted and which should be carefully considered by a project sponsor. Advantages

Jan 1, 1985