contractor's ore at other Peruvian concentrate facilities may be substituted for new production, and the definition of new production for all purposes of this contract shall include such zinc concentrate so substituted." That is modified in another part of the contract? Mr. FORD. In am sure it is. Senator MALONE. Yes. (Discussion off the record.) May I see that? Senator MALONE. We will recess now until tomorrow morning at 9:30 o'clock. (Thereupon at 3:45 p. m., a recess was taken until Saturday, October 17, 1953, at 9:30 a. m.) 89888-54-pt. 2—24 STOCKPILE AND ACCESSIBILITY OF STRATEGIC AND CRITICAL MATERIALS TO THE UNITED STATES IN TIME OF WAR SATURDAY, OCTOBER 17, 1953 UNITED STATES SENATE, The subcommittee met, pursuant to recess, at 9:30 a. m. in the committee room, 224 Senate Office Building, Washington, D. C., Senator George W. Malone, Nevada, chairman of the subcommittee, presiding. Present: Senator George W. Malone, Nevada (chairman of the subcommittee). Also present: Jerome S. Adlerman, counsel to the subcommittee; Thomas F. Flynn, subcommittee assistant counsel; George B. Holderer, member of the professional staff of the subcommittee; and Richard G. Sinclair, subcommittee accountant. Senator MALONE. The committee will be in order. Mr. Walsh, you had some corrections or additions to the record of yesterday? STATEMENTS OF A. J. WALSH, COMMISSIONER; IRVING GUMBEL, DIRECTOR, MATERIALS DIVISION; CHARLES W. GASQUE, JR., ASSISTANT GENERAL COUNSEL; ALBERT H. GREENE, ASSISTANT GENERAL COUNSEL; CLARENCE FREDELL, ACTING CHIEF, EXPANSION BRANCH; JOHN FORD, ACTING CHIEF, CONTRACT ADMINISTRATION BRANCH, MATERIALS DIVISION, EMERGENCY PROCUREMENT SERVICES, GENERAL SERVICES ADMINISTRATION; AND MAX K. MEDLEY, COMPTROLLER; R. J. LIPPOLT, DIRECTOR, DEFENSE ACCOUNTS DIVISION; VICTOR ERICKSON, FINANCIAL ANALYST, OFFICE OF THE COMPTROLLER; JOHNSTON RUSSELL, DEPUTY DIRECTOR, CREDIT AND FINANCE DIVISION, OFFICE OF THE COMPTROLLER; JOHN CROSTON, PROGRAM BRANCH, MATERIALS DIVISION, EMERGENCY PROCUREMENT SERVICE; R. E. WILSON, MATERIALS DIVISION; H. G. HYMER, INSPECTOR, FEDERAL SUPPLY SERVICE, GSA; ROGERS WAUGH, EXPANSION BRANCH, MATERIALS DIVISION, EMERGENCY PROCUREMENT SERVICES Mr. WALSH. Yes, sir. In giving testimony yesterday on the amount of copper coming out of Canada for stockpile, I failed to include in those figures the amount of copper which was being generated by International Nickel Co., and the Sherritt Gordon Mines, as part of their nickel production. In the case of International Nickel, it is 30 million pounds of copper for the period January 1, 1954, to December 31, 1958. The price is the average market price at the time of delivery. No advances of funds were made. In the case of Sherritt Gordon Co., the amount of copper generated through the nickel program is 25 million pounds and that would be delivered over the period January 1954 to December 1958. The price is the average market price at the time of delivery. No advances are involved. This information is contained in the exhibit which I am furnishing for the record. Exhibits submitted for the record are as follows: First, the names and addresses of all the companies from which we have purchased rubber. This exhibit also contains a list of names of purchasers of rubber that were made at the time the Government was made the exclusive buyer of rubber. It is identified as wash contracts. The reason for that is that this is rubber that had been bought by these companies prior to the Government taking over control. It was in the pipeline flowing to them. Therefore, for the purpose of the record, we accepted title, and immediately transferred title to the original buyer. Therefore, they are called wash contracts. Senator MALONE. That will be exhibit No. 2 of Mr. Walsh's testimony. (The document was marked as "Exhibit No. 2" and filed with the record. This data appears in the record on p. 89.) Mr. WALSH. The next exhibit is that nickel and the copper generated as a result of that nickel operation with the International Nickel Co., and the Sherritt Gordon Co. This list contains the names of the officers of the company and the addresses of the companies. Senator MALONE. That will be accepted and filed as exhibit No. 3 of Mr. Walsh's testimony. (The document was marked as "Exhibit No. 3" and filed with the record; it appears on pp. 245, 247, 257.) Mr. WALSH. The next exhibit is the photostat of the contract with the Hudson Bay Mining and Smelting Co., Ltd., of Canada, for 30,000 tons of high grade zinc. It also contains the names of the officers of the company and their addresses. Senator MALONE. That is accepted and filed as exhibit No. 4 of Mr. Walsh's testimony. (The document was marked as "Exhibit No. 4" and filed with the record; it appears on p. 328.) Mr. WALSH. The next is the photostatic copy and amendments to the lead contract with the Compania Minera de Huehuetenango, and accompanying letter, giving the names of the officers of the company and their addresses. I should like to call your attention to the fact, sir, that at the time this contract was entered in with a floor price of 17.342 and a ceiling price of 20.342, the market price was 2112 cents a pound. That is in the exhibit. Senator MALONE. What is this for, the zine? Mr. WALSH. No, sir. This is the lead out of Guatemala. Senator MALONE. It is accepted and filed as exhibit No. 5 of Mr. Walsh's testimony. (The document was marked as "Exhibit No. 5" and filed with the record and appears on pp. 311, 334, 345.) Mr. WALSH. Those are all the exhibits that I have, sir. Senator MALONE. We were discussing yesterday the contract with the four companies in Africa. Was it four companies in Africa? Mr. FREDELL. Four copper companies, yes, sir. Senator MALONE. Four copper companies in Africa. I believe you testified that the stock in these companies is held principally by England? Mr. FREDELL. English and American interests both. Senator MALONE. Do you have any idea how ownership is divided, and what the American ownership represents? Mr. FREDELL. No; I do not. Mr. CROSTON. Two of the companies are American controlled. They are controlled by the American Metal Co. The other two are controlled by the Anglo-American Corporation of South Africa, Ltd. Senator MALONE. Do you have any personal knowledge as to how the stock is divided, and who really controls the companies? Mr. CROSTON. The American Metals Co. has the largest single holding in two of the companies. Senator MALONE. What two companies? Mr. CROSTON. The Roan Antelope Copper Mines, Ltd., and Mufulira Copper Mines, Ltd. Senator MALONE. The American Metals Co. has the controlling interest in these two companies? Mr. CROSTON. Yes. Minority interests are held in England and South Africa. Senator MALONE. Are the minority stockholders made up of the British Government or companies organized in Britain? Mr. CROSTON. To my knowledge I do not believe there is any British Government interest in it. Senator MALONE. But they are British companies? Mr. CROSTON. No, they are no longer British companies to the best of my knowledge. I think all four of them have changed their domicile to northern Rhodesia in order to escape the heavy taxation. Senator MALONE. Even American companies are organized in Rhodesia. Mr. CROSTON. The four companies were United Kingdom companies, and they have changed their domicile to Northern Rhodesia, on account of taxation. Senator MALONE. Taxation in England? Mr. CROSTON. Yes, sir. Senator MALONE. Then these two companies controlled by the American company, the American Metals Co. are separate entities and organized in Rhodesia; is that right? Mr. CROSTON. I believe now they are. They were originally organized in the U. K. I believe they are now Northern Rhodesian corporations. Senator MALONE. But in any case, although controlled by an American company, they are not organized in the United States, and have no allegiance to the United States. In other words, they are not American companies. |