MANGANESE DEPOSITS, SOUTHERN NEVADA

Mr. REGAN. Did you have some questions?

Mr. BARING. Mr. Chairman and Dr. Boyd, isn't it true that manganese deposits occur in about 27 different States?

Dr. BOYD. I believe that is true; yes, sir. They have detected manganese in about that many States.

Mr. BARING. Whether it is 20 percent or not, isn't it valuable to get into our present program?

Now, Mr. Bradley sat here for 3 or 4 days and told us about four or five known deposits that you are working on. Is there any program for the small fellow, the little fellow, like in southern Nevada, in the Virgin River Valley?

I have a report here just to show you what I mean, from D. F. Hewitt, United States Geological Survey, in which he says:

But we have found some very impressive extensions of known small deposits. That is particularly true in the Virgin River Valley of southern Nevada. Certainly we would be able to add at a guess at the minimum 10 million or more tons of material that runs 10 percent or more manganese.

Isn't that well worth going after and getting a program for?

Dr. BOYD. We have discussed the possibility of working out a more general program for manganese which has been proposed before this committee many times, but the difficulty with them is that you go up to these scattered deposits in these various States running that kind of grade of manganese; you can expect to produce manganese in the high grades and the small deposits, but to go into a vast number of small operations at 10-percent manganese would be a very wasteful procedure of manpower and materials and time.

Now, I wouldn't rule it out entirely, of course. We have been studying this thing in general, but the best part of the program that seems to come out now would be to pick these individual areas and help them go into production.

I don't happen to know about the Nevada one yet, whether that has been studied in detail or not.

Mr. BARING. This report came out in 1941, Dr. Boyd.

Dr. BoYD. But 10-percent manganese is getting pretty low down the scale. We have large deposits, and very large deposits running considerably more than that would be more efficiently mined.

Mr. BARING. What is the percentage of the Three Kids at Las Vegas?

Dr. BOYD. As I remember, that is about 14-no; I don't know offhand. It is about 25. I can't tell you offhand, Mr. Baring. I don't remember. It is considerably higher than 10 percent, though.

Mr. BARING. Well, I was hoping to get some information from your Department, Dr. Boyd, as to some program you are formulating for these smaller mines scattered across the country in the 27 States, such as terms, delivery, and so forth.

We are in the dark up here as to whether you are doing anything for them.

Dr. BOYD. We had to take those areas which showed most promise first. That is what we are talking about today-the areas where we

can give them some assistance. They are all small people at Butte, Philipsburg, Deming, around El Paso and Batesville. Those are the most promising areas where small people are operating.

These are small operations, not big ones. Now to bring them all into that kind of a program would be very difficult to administer, and we have got to take the time to work that out so we can be of some help to them and not make a brash program which couldn't be operated efficiently for them. If they can show promise in bringing in their projects that way we certainly could work out a deal with them.

Mr. BARING. You have here in this program proposed a domestic manganese program, on page 3; new small mines, small purchase contracts, up to 5,000 tons, will be let by GSA to small producers in sev eral parts of the United States, particularly in the South and South

west.

Can you give us any more information?

Dr BOYD. I would have to get that together to see how many of those things are in. I haven't been informed of any substantial numbers coming in. They would have to apply for those direct.

I think that has been the policy of GSA for some time-to do that.
Mr. REGAN. Did you have any questions, Mr. Aspinall?
Mr. ASPINALL. No.

ARTILLERY PEAK (ARIZ.) MANGANESE DEPOSIT

Mr. REGAN. I see our chairman doing some deep thinking over there, Do you have any questions on manganese, Mr. Murdock?

Mr. MURDOCK. Several have come to mind, Mr. Chairman. What is being done at the new plant at Boulder City? How far along is that?

Dr. BOYD. I get a report about once a week on that, Mr. Murdock. The machinery is moving in there now. The warehouse has been built, the plant itself is very far along. The engineering work is about 95 percent along now, I understand, in detailed planning.

The ore is moving up from Artillery Peak and being put on a dump outside the plant at the moment.

Mr. MURDOCK. Are we to call that a pilot plant?

Dr. BOYD. That is a pilot plant; yes, sir. It is quite a large-scale one, but it is a pilot plant.

Mr. MURDOCK. Is ore from any other area than the Artillery Peak area being brought there?

Dr. BOYD. Not at the moment. We will work the Artillery Peak ore first. Then we will work the other ores when that work is cleared away and finished.

Mr. MURDOCK. And that is for the purpose of determining the technique of beneficiating low-grade ores?

Dr. BOYD. That is correct; specifically, the Artillery Peak ores. Mr. MURDOCK. Specifically that, and yet a survey taken some years ago in an area about 150 miles in all directions from Hoover Dam shows that the entire region is mineralized and I expect that includes some of those small mines that Mr. Baring was talking about, so that when this plan goes into full swing, Mr. Baring, it might help all the area within 150 miles of Boulder City.

Dr. BOYD. I think that is a fair statement, Mr. Chairman.

DMA ADMINISTRATIVE DIVISION OF RESPONSIBILITY DISCUSSED

Mr. ENGLE. Dr. Boyd, may I ask you one further question?

I am a little intrigued about the mechanics of this operation. I have always been a little intrigued with the mechanics of the operation down there.

Mr. Bradley is head of the Crome-Manganese-Tungsten Branch of the Supply Division. Mr. Mittendorf is Chief of the Contract Division. Mr. Bradley was hired as a consultant and I assume at some expense to the taxpayers of the United States.

He recommended a program. The program then goes up to Mr. Mittendorf who is supposed to run the Contract Division, and put in contract form.

The Supply Division, with its paid consultants, who are presumed to know something about the industry in the field, and what can be done, works out and recommends a manganese program, and then Mr. Mittendorf turns around and rewrites the whole business and changes. the recommendations made in the Supply Division.

What kind of an administrative set-up is that?

Dr. BOYD. I think that might be understood if I put it this way: The Supply Division's job is to find out what is required, and where the supplies will come from to fill that requirement.

In other words, they are responsible for seeing that we have programs established to meet the deficits in these various materials we are concerned with.

And that they recommend in general the projects which would go in to meet that deficit and demand. Now, naturally, the business of whether we make a loan, whether we make a tax application certificate recommendation, whether it should go into a contract, or whether it should be an RFC guaranteed loan, or whatever it may be, is a thing that we could not expect all the people in the Supply Division. to learn all the details of those business arrangements; so consequently many of these recommendations will come up; if they go too much into detail in the financial arrangements, they will find that they are not possible of accomplishment under the law or under some other policy arrangements such as we are working under from a point of view of contracting or loans.

The result is that it isn't fair to expect the final decision to be made on the basis of the recommendations, the general recommendations of the Supply Division. Their main point is to determine which of the projects will do the job of meeting the deficits in supply.

Now, if they knew all the angles of making contracts, loans, and so forth, we would have to spend some time educating every one of them. Consequently, many times their recommendations come up and they are only board recommendations which would be different from what finally comes out of the mill.

DISCUSSION OF PROPOSED MANGANESE PROGRAM

Mr. ENGLE. It seems to me you could have saved some time in this instance by dispensing with Mr. Bradley's services and let Mr. Mittendorf do the job from the beginning because it was done over anyway.

Dr. BOYD. Mr. Bradley had to work up the manganese program. which he did, to determine what places it should come from.

Mr. ENGLE. But when you have a man who is supposed to be making contracts in line with the general program and then having the contracting official rewrite the whole business

Dr. BOYD. As a matter of fact, sir, when I sat down with both of them on Saturday I didn't find a very great difference of opinion be tween them on the actual program. It only amounts to about 5 cents per unit when you get through with it. In the case of Mr. Mittendorf's program, he worked that out in great detail on costs, and so forth. Mr. ENGLE. But the drafts of Mittendorf's prices are very steep, after you get into higher brackets, whereas Mr. Bradley had a flatter chart, you might say, on the costs per unit as the grade increases.

Dr. BOYD. That is mainly due to the fact that the lower grade ores do not produce recoverable manganese as well as the higher grade ⚫ores. Therefore you need to encourage either concentration or the production from the high-grade ores.

Mr. ENGLE. I can't believe that Mr. Bradley recommended that the Government buy ore that wasn't usable or couldn't be made usable. Dr. BOYD. No, but the schedule we talked about encourages the development.

Mr. ENGLE. You might as well contract for plain dirt if you are going to do that. In other words, that doesn't add up to good sense to me and, knowing Phil Bradley, I don't think he would do that. I really don't. I think you misinterpreted what he recommended.

Dr. BOYD. Well, he does feel that perhaps there is a little bit more complication in this schedule we propose, but in general, the approach he has to it is very little different from this schedule. When you have to pay under the schedule proposed to us $1 a unit for 20 percent manganese you have to take the recoverability factor out of that. The man would have to get paid only for what could be recovered. We talked about that before. That is already taken out of the other one, and he knows definitely what he can expect to get from his ores at that grade so he can plan his mining operation on it.

Mr. ENGLE. Mr. Long says he won't operate under this proposed schedule and he is the biggest operator in the area-Deming, N. Mex. Dr. BOYD. He is the biggest prospective operator in the area. Mr. ENGLE. That is right.

Dr. BOYD. That is only on the basis of leases; but he has never given us any detailed information to justify or to assure us he can produce from those mines.

Mr. ENGLE. If I were going out to buy horses and the fellow who had horses to sell told me he wouldn't sell them at the price I offered, I would try to arrange for a price he could take.

Dr. BOYD. If he had the horse you could use it when you could

get it.

Mr. ENGLE. I would buy it, in this instance; I wouldn't argue much. In this instance the Government is interested in announcing a program on which the follow who has ore can produce the materials or a portion of it, and he says he won't buy it.

Dr. BOYD. He hasn't given us any assurance that he can produce

the ores.

Mr. ENGLE. You are not going to pay unless he delivers it.

Dr. BOYD. Let me get back to the question of how far you can go with the funds you may have. I wish we had the freedom of action that would indicate.

Mr. ENGLE. It isn't a quantitative matter altogether because even up to 4,320,000 units, you could put a price schedule on there that some operators could produce under.

Mr. REGAN. We planned on having Dr. Boyd until 11 o'clock. Mr. Wharton, did you have any question on manganese?

Mr. WHARTON. No.

Mr. REGAN. Mr. Budge?

Mr. BUDGE. No questions.

RECAPITULATION OF STATUS OF CONTRACTS

Mr. REGAN. Doctor, as I get this hearing this morning, we are all set to go on the program or areas that we have had this discussion on manganese in the last 3 or 4 weeks. In other words, El Paso is all set, the contract to be signed in the near future, and there is no more delay on the buying of ore for El Paso.

Dr. BOYD. The contract is in the hands of GSA. I haven't talked to them today, but I understand that is true.

Mr. REGAN. In other words, the only thing left is getting the pocketbook open.

Dr. BOYD. That is right.

Mr. REGAN. In Butte you have cleared that so you will have your contract ready sometime in the next week to go forward there.

In the Deming area you are setting up this schedule that will be out sometime next week for the purchase of ore which in your opinion will bring about the desired result in stockpiling the ore at Deming. Dr. BOYD. That is right.

Mr. REGAN. I think that is about all that we wanted to hear from you on the manganese this morning, Doctor. We thank you again for coming. We hope there will be no further delays in this whole program.

We are going to ask now, as soon as you step aside, to see what the pocketbook has to say about spending the money.

Mr. ENGLE. Mr. Chairman.

Mr. REGAN. Mr. Engle.

Mr. ENGLE. Mr. Ewing and Mr. Jacoby are here from OPS. They have something to explain. They told us a few weeks ago they were going to take the lid off this thing. They are here. I don't think it would take very long. I wonder if we could ask Dr. Boyd to stay so we could run the spotlight on some of this other stuff. Dr. BOYD. I would be happy to stay..

Mr. REGAN. On one occasion we could see the ball passed back and forth. It might be a good idea on that if we had Mr. Ewing and Mr. Jacoby step forward now.

Will you, please?