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By A. W. White

Introduction To discuss all the technical details of incorporation laws, security laws, underwriting procedures, codes, and ethics-as laid down by varous associations -would be impossible in the time which has been allotted to me. My remarks, therefore, will be made in a very general way and will naturally be coloured with experiences which my firm and I have had. There is a common expression that "money makes the mare go". I hardly have to mention here that the best prospect in the country is of very little value unless its prospects can be developed-and this requires large capital expenditures. The art and problems surrounding the raising of this money is a long and interesting story. Since by its very nature mining is risky, the appraising of its risks in the many phases of its development programme is continuous. Very few men-if any-and very few corporations -if any -can afford to take all the risk of mining. Because of taxation policies-and the very scheme of present-day living -the truth of this statement can be seen throughout the whole industry by a close examination of the records. Since this is so, it is essential that the mechanics of distributing risk on a sound, and equitable basis be known to those engaged in the business and to the investor or spectator who proposes to risk his funds in the industry. Perhaps the greatest stimulant to modern business activities has been the creation of corporate bodies. It is evident, from the number of charters being granted by various jurisdictions, that this method of doing business is becoming more and more important. A limited company -or corporation-can be defined as a fictitious person existing solely in contemplation of the law.

Jan 1, 1951

By Arthur Notman

Since addressing the Institute a year ago on The Future of the Copper Industry (l), many things have happened, most of them bad. It has been a hard year for profits and prophets. It was, therefore, with consider-able perturbation that I accepted the gracious invitation of your Committee to reappear. On reviewing my remarks of a year ago, I. have wondered whether, under pressure of more important matters, the Committee had neglected to make a note of them, or whether they felt that further explanations from me were in order. In either event, I am glad that I am here and welcome the opportunity to make any contribution I can to a clearer understanding of the problems of copper to those concerned. The English-speaking nations own 80 per cent of the present world-production of the metal. Col. P. E. Barbour, Secretary of the Mining and Metallurgical Society of America, and I recently completed an estimate of the known world resources of copper. We placed the figure, in round numbers, at 100,000,000 tons of metal. Of this amount, about one-third lies in the United States, one-third in the British Empire, and one-third in South America; and all but 4 per cent of this is owned by British Empire and United States capital. Our figures do not include any estimates for Russia, Japan, or Europe, on which there are no available data. It is true, consequently, that the British Empire and the United States are the ones concerned. It seems to me to be a matter of great importance to the world at large, and of even greater importance to those nations themselves, that the known sources of supply of this metal, so essential both in peace and war, rest so strongly in their hands. I cannot believe that in the long run they will neglect their responsibilities in the wise administration of these resources.

Jan 1, 1932

By Karl J. C. Harries

Mineral Agreements and Royalties

Jan 1, 2003

By Balmer Neilly

To one with so little experience in matters pertaining to currency, international finance, and foreign trade, this is surely an ambitions venture on my part. However, this is a subject of prime importance to all seriously minded Canadians and, if we are to obtain any clear understanding of the factors involved, we must study the facts and debate such points as may remain at issue. During the last few years, the world' s better known economists have described the gold standard in all its ramifications and in such detail as to leave many of us even more confused than before. If we, then, are to acquire any real conception of its meaning and use, I think we must reduce it to its fundamentals and start from there. To my way of thinking, gold in ? trade and commerce is the symbol of honesty. When you seek to discharge a debt by tendering paper you hand the recipient an I.O.U. which may or may not be good, for the purchase of goods or services to the extent of its face value. When, however, you discharge a debt by the payment of gold, it constitutes a complete and final discharge. There are no reservations - no ifs and ands - and the transaction is definitely closed to the satisfaction of all concerned. Gold, then, is evidence of accumulated and transferable wealth that is immediately acceptable in practically every part of the world. However, there is not nearly enough gold to meet the demands of world trade, and. many years ago this deficiency gave rise to what we now describe as our banking system.

Jan 1, 1949

By Theo. A. Link

ACCORDING to our office dictionary, geology is "the science that investigates the structure of the earth and its successive physical changes", and a geologist is "one who knows the science of the structure of the earth". No doubt this definition does not suit all of us. Another dictionary would have the definition slightly different. As an example, one dictionary stated that "a geologist is one who practices geology". (Some of our clients told us to quit practising and get to work). There are many different types of geologists engaged in various branches of the profession and some of these are further broken down into subdivisions so that specialization is becoming more and more prevalent. As a result it is, in some cases, doubtful whether or not we are actually dealing with a geologist in the generally accepted sense of the term.

Jan 1, 1956

By D. A. Karvonen

In 1970, the Government of Saskatchewan instituted a program aimed at resolving the dilemma of excess productive capacity over the market demand which existed for potash produced in Saskatchewan. The two primary elements of the program were prorationing of potash production to market demand and a minimum selling price. The paper reviews the factors, both local and international in nature that led to the introduction of the program. The licensing mechanics and the operation of the program, along with the changes that have been introduced in two and one-half years of operation, are discussed. Attention is given to the results of the controls as they affect the industry and the province. Also discussed is the outlook for Saskatchewan potash in world markets.

Jan 1, 1973

By Karl J. C. Harries

"8.1. INTRODUCTIONThe purpose of this chapter is not to provide precedents or examples of provisions, but rather to offer some comments that may be worth considering in the negotiation or review of an agreement. These comments are not intended to be exhaustive. It must also be noted that, although the chapter is written in the context of a common law joint venture, the concepts and concerns for the most part apply equally to a corporation that is owned by only a few shareholders for the purpose of participating in the project held by the corporation.The corporation has the advantage of having much of its organization established by local corporate law, but the particular wishes of the shareholders will appear in a shareholders’ agreement. The principal differences will be surprisingly small, save for the acquisition provisions that appear in a farm-in agreement1 and the substantial portion of the joint venture agreement devoted to creating and organizing the joint venture entity. Where the joint venture agreement refers to venturers and committees, the shareholders’ agreement will refer to shareholders and the board of directors, but both will have to deal with such basic matters as decision-making, default, dispute resolution, first refusals, funding, and carrying out work on the project. For convenience, this chapter usually refers to “venturers”, which may be taken to include shareholders.Negotiations give rise to many varying circumstances and concerns, and the main asset of the negotiator is an open and flexible mind. A desired result can often be accomplished indirectly in circumstances where the other side has adopted an inflexible position on a suggested approach. As precedents and standard forms tend to focus a negotiator’s thinking, they can be counterproductive. It is after the deal has been agreed to that a precedent can be of great assistance to the draftsman.The concepts are arranged in alphabetical order for convenience, not to suggest their sequence or position in an agreement or their relative importance. An agreement should adopt a progression of subjects in what the parties consider a logical sequence to read and work with. However, experience has indicated that it is best to set out in a single article the substance of the deal (i.e. the terms relating to the farm-in and what the acquiring party has to do to acquire his interest), preferably near the beginning of an agreement. The acquisition of the interest is, after all, the first order of business. The joint venture provisions will then follow in a reasonable sequence. It is also worthwhile to devote a single article to any special provisions that may apply during the earn-in period. For example, it may be provided that, although all work is to be done by the acquiring party as operator (with the duty of care, liability, and reporting requirements as set out in the joint venture sections of the agreement), but during the acquisition period, the acquiring party, acting as operator, may be at liberty to do such work as he wishes, without the need for any committee or other approvals, and committee meetings may be suspended.2An agreement is divided into paragraphs and articles to make it easier for the parties to read and understand, and to assist a party in finding “that provision” when the need arises. A comprehensive table of contents will also assist the parties who must work under an agreement. An added benefit of a table of contents is that in preparing it, the draftsman sees the overall structure of the agreement and will often catch and correct flaws."

Jan 1, 2003

ONE of the morning sessions at the recent Annual Meeting was devoted to a Symposium on ways and means to expedite geological investigation, and also to promote greater prospecting activity, in Canada. It will be recalled that at the 1940 Annual Meeting, held in Winnipeg, a paper(l) prepared by Dr. G. A. Young, Chief Geologist of the Geological Survey, was presented, and was followed by a Symposium on Geological Investigations in Canada(2). On that occasion, the participants were in the main geologists, and they included the directors or other officials of each of the Provincial departments or bureaus of mines. At the Montreal meeting, the subject was discussed mainly from the point of view of the mining industry. The following pages present, in somewhat summarized form, the several contributions to that discussion.-ED. DR. J. J. O'NEILL(3), who was to have opened the Symposium, was unfortunately prevented through illness from attending the meeting. He had intended outlining the main features of his paper on The Exploitation and Conservation of Mineral Resources in a Balanced Development of Canada, presented at the last annual meeting of the Royal Society of Canada( 4). In his absence, DR.J. A. DRESSER presented a summary of the paper.

Jan 1, 1941

By W G. Brese

The attention of the world is being focused on the spectacular rise of elemental sulphur production in Alberta. In the short space of a decade, production has increased from less than 10,000 long tons, in 1952, to al-most 1,000,000 long tons in 1962. Moreover, 1963 sulphur production is expected to rise by 50 per cent to approximately 1,500,000 long tons, and further increases are forecast for ensuing years. The reason for this dramatic in-crease in elemental sulphur production, particularly in the last year or two, is that Alberta elemental sulphur is recovered in association with the production of sour natural gas. When very large volumes of natural gas began moving to U.S. markets in the latter part of 1961, the resultant increase in sour gas production led to a marked increase in the production of sulphur. Consequently, Canada, mainly on the strength of sulphur produced in Alberta, will soon become the second largest producer of sulphur in the Free World

Jan 1, 1963

By L. M. Dwarkin

Strip mining in Western Canada, though of considerable importance, is a fairly recent development for many of the operators in the district. Adding to the difficulty of unfamiliarity is the fact that a great deal of the stripping is done on pitching seams, for which the engineering and economic principles of setting the most advantageous strip ratio are not readily apparent. The novelty of the operation combined with the complexity of the principles involved can easily lead to misconceptions as to the determination of the economic ratio. Definition of Strip Ration There are two commonly accepted meanings of the term strip ratio: (1) The ratio of feet of overburden to be stripped per foot of coal recoverable. (2) The ratio of cubic yards of overburden per cubic yard or ton of coal. The first definition is inapplicable to pitching seams so, throughout this paper, strip ratio will be taken as the ratio of cubic yards of overburden to be removed per cubic yard of coal recoverable. Economic Ratio In the case of flat seams, the strip ratio is fixed by existing natural conditions, and the magnitude of this ratio determines whether stripping is economically feasible. With pitching seams, however, the strip ratio is a variable. On the outcrop, there is usually some coal which can be obtained with little or no stripping. As the work is carried down the pitch of the coal seam, the proportion of overburden continually increases until a point is reached where it is no longer economical to continue the operation. The question immediately arises as to the location of this point, and this resolves into the problem of determining the most favourable strip ratio, or, to use the accepted term, the economic ratio.

Jan 1, 1949

By John T. Whetton

"FROM 1850 when the annual production was around 50 million tons, coal output in Great Britain expanded rapidly to 225 million tons in 1900 and 287 million tons in 1913. However, during the First World War, countries which had previously bought large quantities of coal from Britain sought other sources of sup-ply or developed their own coal re-sources. Thus from the record figure of 73 million tons exported in 1913, Britain's coal exports declined until in 1938 they stood at 39 mil-lion tons. An important reason for this was the development of oil engines for marine propulsion. Today, nearly all the navies and mercantile shipping in the world have turned to oil engines. Sometime in the future, however, it is reasonable to expect nuclear power to replace oil.During the Second World War, coal output in Great Britain and manpower at the mines were reduced considerably and in 1.945, 175 mil-lion tons were produced by 709,000 miners. Exports were meagre, only 8.""7 million tons went to foreign consumption. During the severe winter of 1947, inland demand for coal exceeded production and exports were prohibited. Even importation of coal was required to meet inland demand. These were years when the coal industry of Great Britain made immense efforts to secure maximum output irrespective of economy. The energy needs of Great Britain appeared insatiable; but had it been possible to export, the nationalised mining industry could have made huge profits as there was a world shortage of coal. However, home needs were considered to be the priority and many overseas markets were lost. Other producers moved in and secured long-term contracts. Not only was the British export market lost, but also the nationalised industry had to sell the imported coal at the same prices as home-produced coal and suffered losses up to of:3 per ton. Bence, at a time when the National Coal Board might have ac-cumulated a reserve fund to cope with less prosperons times, it was having to spend large sums of money securing sufficient coal for inland consumption. This was a time when intensive efforts in the mining industry, comparable with those of many industries and establishments inclusive of the armed services during the war, would have produced a greater amount of coal and have been of immense value to the country as a whole."

Jan 1, 1960

By Arthur Notman

In view of the alarm expressed in many quarters over the increased production of copper to come from Canada and Africa in the future, it is of interest to study the history of the principal producing districts of the world and to attempt to forecast the future part to be played by them. Tables 1 and 2 record the world production and that of the United States, together with their respective rates of increase, both in percentage and actual amounts. The important point in this record is the decline in rates of increase for both the world and the United States, but more particularly in that of the latter, since 1881. The increase for the United States in the last decade is less than that for any decade since 1881, and is only 20 per cent of that for the decade 1911-20. The increase for the world is less than that for the two preceding decades, and is only about 65 per cent of the war decade 1911-20. Referring to Table 1, the decade 1871to1880 showed an increase of 32.l per cent in the world's production, which was the low until the last decade, ending 1930, which shows an increase of only 24.5 per cent. These decades both represent periods of economic stress following wars. In the first case the recovery was very sharp, the percentage increase in 1881-90 reaching a high of 86.4 per cent. It would seem dangerous, however, to assume that a similar high will be reached in the next ten years, because of the severity of the depression brought about by the Great War and the probability of its influence extending well into the next decade.

Jan 1, 1931

By Karl J. C. Harries

"5.1. INTRODUCTIONThis chapter is intended as a general overview of the subject of royalties between private parties – royalties extracted by governments are not dealt with. This same subject is covered in detail in Volume II, which critiques many sample provisions taken from agreements, giving both pros and cons. If you find something that interests you in this chapter, check Volume II for extra information. Detailed cross-referencing to Volume II has not been attempted, however, most subjects mentioned in this Chapter will also appear in Volume II, usually in greater detail. Reference should be made to the Index.A Brief History of Royalties1In the early days of mining in Canada, the tendency was to sell a claim for cash and to move on, using the stake to look for and stake more prospects. As prospectors became more sophisticated and Canada’s North opened up, the market for properties and the number of mining properties available increased dramatically. Speculation and the practice of consolidating several small properties into one large holding entity became common. In “hot” areas, the speculators2 could far outnumber the prospectors, many of the former having little or no prospecting expertise but lots of market and promotional savvy. However, to consolidate a number of small parcels into one large project can be expensive, and many of the parcel owners became interested in keeping a share in the project, rather than giving up everything. Speculators who were trying to consolidate small parcels wanted to minimize cash payments to parcel holders (usually they did not have much cash and preferred it flowing in their direction rather than away from them). Accordingly, non-cash transactions were developed to meet the aspirations of both owners and speculators."

Jan 1, 2003

By Lucas G. Thompson

My topic, "The Administration of Mineral Rights'.' is possibly an unusual one, as it deals with a subject upon which many of us have a more than passing interest, I thought ?it might prove consistent with the objects of this meeting, more especially as I propose to deal, not with those broad subjects of nation-wide importance which are often the subject'? of learned (and sometimes futile) academic discussion, but rather with problems in their practical light. To the scientist, the important question is What is it? to the technician, Can it be utilized? to the business-man, Will it pay? All three questions are important, and so quick has been the march of business on the heels of science? that the one question follows the other with astonishing rapidity and all three must be considered in the modern management of a mineral estate. A .good illustration of the force of this can be found in the recent advance of our knowledge of the element helium in which we have advanced from a solution of the first question to the last question in the short period of 55 years. It is to be borne in mind, however, that in the administration of mineral rights, the question "Will it pay?:' is of primary importance. What forms a mineral estate ? A former practice in western Canada in selling lands was to sell the hair with the hide. All transactions sold the lands in fee simple, which included all mines, minerals and rights and privileges whatsoever, excluding only the royal metals, gold and silver, which by imputation, though not by specific reference, in deeds. of title are reserved to the Crown. At that time the country was in the first ?stages of settlement and the value of our mineral resources was hardly appreciated and little understood.

Jan 1, 1923

By J. W. Sanger

The establishment of a central steam-heating system in Winnipeg and its inauguration in October, 1924, has attracted a considerable amount of attention. Not only does it excite the curiosity of the engineer, but it has stirred financial and civic bodies throughout Canada to such a degree that there is now a much keener general interest in this particular type of public utility than has been shown heretofore. This does not mean that we may expect a mushroom growth of central-heating systems in all our larger Canadian cities in the near future, but it does mean that the pioneer work which Winnipeg is now doing will undoubtedly be used to guide others in their judgment as to the feasibility of similar projects elsewhere. The success of the municipal hydro-electric system in Winnipeg, and the low rates for electricity resulting therefrom, was without a doubt the most important factor influencing the citizens of Winnipeg to venture into this new field. The events which led up to the central steam-heating proposal in Winnipeg are interesting.

Jan 1, 1926

By George B. Saunders

The mines in western Canada producing steam coal will find a better opportunity this year to market their product in Winnipeg - for two reasons: First, the new wage schedules, signed with local unions at each mine, have enabled them to reduce the selling price materially. Second, the duty on slack coal coming in from the United States has been raised to 50 cents, which is equal to the duty on run-of-mine coal. This has had the effect of raising the cost of mine-run to .the importer. Formerly, it was the practice to bring in slack coal under a duty of 14 cents and lump coal under a 53-cent duty and, by judicious mixing of the two, manufacture a mine-run coal at an average duty cost of about 22 cents. Fortunately, through efforts of the Alberta Government, and other friends of the Canadian coal trade, the Federal Government was persuaded to adjust the duty on slack coal as indicated. While it will be found that the Manitoba market, this season, is slightly more easy of access we have still a long way to go before we reach the desired goal. Geographically and economically the Manitoba market should belong to western Canada. However, it has been found a very profitable market for United States mines because large tonnages of coal can be shipped, practically at the convenience of the mines, via the Great Lakes, during seasons of slack business. They will therefore not relinquish this market without a struggle.

Jan 1, 1925

By Roberto Antoniolli

"IntroductionSINCE ancient times, the precious metals have played an important role in influencing the course of history. Silver and gold happened to occur, although in small amounts, in those countries where the early civilizations developed. Their persistent brightness certainly amazed the primitive people, who also found it easy to shape them into ornaments •and implements. Ever since then their properties have made them seem desirable possessions.Use of precious metals as money was the natural consequence of man's desire for them. The possibility of changing an ornament into a tool or food at any time, and the ease with which such medium of exchange could be carried and hidden, further increased the demand for the two metals.Silver was probably discovered after gold and copper, and was undoubtedly found by prehistoric man as native silver. The oldest silver articles have been discovered in Chaldean tombs and date back to 5000 B.C. The earliest ascertained producers of silver were Asia Minor and the Iberian Peninsula. The Romans worked deposits in Spain, Britain, and France. In the Middle Ages, some silver was extracted from German deposits, and near the end of the Middle Ages systematic workings were carried on at Freiberg, Schneeberg, and Joachimsthal (1).Before the discovery of the New Continent, the Aztecs and Toltecs in Mexico, and the Incas in Peru, had made extensive use of silver. In the 16th century the Mexican deposits became the largest source of the world silver."

Jan 1, 1954

By W. G. Deeks

CANADIANS are world leaders in marketing metal and mineral products. Noranda Sales Corporation Ltd. is an international metal and mineral product marketing company operating from Toronto and London, England, where it operates a wholly owned sales subsidiary and is a 50% partner in Rudolf Wolff and Company Ltd., a charter member and the largest metal broker on the London Metal Exchange. Noranda Sales employs 97 people, of whom 52 are university trained and professionally competent in international resource product marketing. We market for 19 companies or divisions in the Noranda Group and 39 companies for whom we act as agent, consultant and purchaser of resource production. Our business in 1976 was 1.5 billion dollars carried out in 45 countries and covering 24 products and materials. Today, ownership of most of the mining industry in Canada has transferred back to Canadians, and this is said with the knowledge that a significant part of the Canadian industry has been Canadian owned and managed from its very early days. Noranda Mines Limited is such an example. It was born in 1922 as the result of a copper-gold showing at Noranda, Quebec, discovered by Ed Horne, a prospector, financed with a grubstake by a syndicate mainly composed of New York businessmen. Shortly after the discovery, when the shares of the company had risen, the syndicate was sold to Canadian interests and, since that time, Noranda has been dominantly Canadian owned and certainly Canadian managed. Today, over 90% of Noranda's shareholders are Canadian, who hold an equivalent percentage of the stock.

Jan 1, 1977

By A. E. Moss

"IntroductionTHE WORLD-WIDE search for iron ore has been vastly accelerated during the past fifteen years .and Canada is playing a most prominent role in this prospecting boom. During this period, the search for .and development of iron ore deposits in Canada bas proven eminently successful and there is every indication that exploration will continue to be active for many years.This paper has been prepared primarily for the information of those who have bad little or no experience in iron ore exploration. For convenience, it is divided into three parts: ( 1) a brief discussion of the marketing of iron ores, with special reference to Canadian production; (2) a summary of the main features to be considered when prospecting for or evaluating a potential iron ore deposit; and (3) an outline of the methods and procedures used in the search for the direct-shipping iron ores in the Quebec•-Labrador iron ore field.The Iron Ore MarketDue to the tremendous tonnages of high-grade direct-shipping iron ore indicated in the iron ore fields of the Quebec-Labrador and Steep •Rock areas, it might be assumed that there would have been a sharp decline in iron ore prospecting in this country. On the contrary, the development of these two major fields, which must be classed among the world's greatest, has been responsible for much of the current activity. The search for high and medium grade magnetite deposits is being• conducted in many parts of the country and a number of these have reached the development stage. Production is being expanded from the known fields, such as Wabana in Newfoundland and Michipicoten in Ontario."

Jan 1, 1955

By Peter M. Watt

The objective s of this paper are: (a ) to examine and discuss the burdens we place on our extractive industry; (b) to compare the levels of taxation in Canada with those in other countries; and ( c) to suggest certain broad parameters within which our taxation policies may be made more rational and stable. Among the burdens identified are taxation, the ownership and use of our resources, environmental issues and the rather emotional issue of so-called 'super profits'. Finally, the paper will address certain broad but key areas of policy which need attention and agreement if our tax system is to be made more rational. Such areas include: whether and if so why the extractive industry should be given incentives;. what circumstances, if any, justify a 'higher' than normal' level of taxation, and, ?if the concept of economic rents is a justifiable one, how might a basis for them be established which recognizes the fluctuating value of much of the industry's output. Note: The paper was written before the 1977 Federal and Provincial budgets were presented. Consequently, the paper does not reflect any changes proposed in these budgets.

Jan 1, 1977