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$ 229.7 Criteria. $ 229.5 Form and filing.

The following factors will be considAn application for Federal financial

ered and weighed in passing upon appliassistance must be submitted in quadru

cations: plicate on forms which may be obtained

(a) The geologic probability of a sigfrom and filed with either:

nificant discovery being made. Geological Survey,

(b) The estimated cost of the exploraDepartment of the Interior,

tion in relation to the size and grade of Washington 25, D.C.

the potential deposit.

(c) The plan and method of conductor Field Officers, Geological Survey. ing the exploration. The regions which they serve and their (d) The accessibility of the project Post Office addresses are as follows:

area. Region I: Alaska, Idaho, Montana, Oregon, (e) The background and operating and Washington_Geological Survey, South experience of the applicant. 157 Howard Street, Spokane 4, Washington. (f) The applicant's title or right to Applicants for Alaska projects may file ap

possession of the property. plications with the United States Bureau of Mines, P.O. Box 2688, Juneau, Alaska, for $ 229.8 Approval. forwarding to the Field Officer, Region I. Region II—California, Hawaii, and Ne

If the application is approved, the vada-Geological Survey, 113 Custom House,

Government may enter into an explora555 Battery Street, San Francisco 11, Call

tion contract with the applicant upon fornia.

terms and conditions which the SecreRegion III: Arizona, Colorado, Kansas, tary deems necessary and appropriate as Nebraska, New Mexico, North Dakota, Okla- set forth in the contract form furnished homa, South Dakota, Texas, Utah, and

by the Government.
Wyoming-Geological Survey, Federal Center,
Denver 25, Colorado.

Region IV: Alabama, Arkansas, Connecti-
cut Delaware, Florida, Georgia, Illinois, $ 229.9 Government participation.
Indiana, Iowa, Kentucky, Louisiana, Maine,
Maryland, Massachusetts, Michigan, Min-

The Government will contribute not nesota, Mississippi, Missouri, New Hamp- more than fifty (50) percent of the total shire, New Jersey, New York, North Carolina, allowable costs of the exploration speciOhio, Pennsylvania, Rhode Island, South fied by the terms of all contracts, except Carolina, Tennessee, Vermont, Virginia, West those for silver for which the GovernVirginia, and Wisconsin-Geological Survey,

ment's contribution will not be more than Room 11, Post Office Building, Knoxville 2, Tennessee.

seventy-five (75) percent. $ 229.6 Information required.

$ 229.10 Allowable costs.

(a) The Government, to the extent (a) Each application shall fully describe the proposed exploration, and

provided in the exploration contract, will shall include all detailed data called for

contribute to: by the application form. The Secretary (1) The necessary, reasonable, and may require the filing of additional in- direct actual costs of performing the formation, including financial state- exploration, including the costs of: ments, reports, maps, or charts, and Labor, supervision, and outside consulexhibits and such physical on-site exam- tants; operating materials, supplies, and ination as he deems necessary.

equipment; initial rehabilitation or re(b) The application must include evi- pair of existing buildings, installations, dence that funds for the exploration fixtures, and operating equipment; conwork are unavailable on resonable terms struction of buildings, fixed improvefrom commercial sources. The evidence ments, and installations; repairs and shall include information as to the com- maintenance of operating equipment; mercial sources to which applications analytical work, accounting, payroll and were made, the amounts requested, and sales taxes, and employers' liability or the reasons why loans were not obtained.

employees' compensation insurance; pay(c) The application must include a ments by the operator to independent certification by the applicant that he contractors; and such other necessary, would not normally undertake the ex- reasonable, and direct actual costs as ploration at his sole expense under cur- may be approved by the Government in rent conditions or circumstances.

the course of work; and

(2) The fixed unit costs agreed upon tract not exceeding 25 years) from the by the operator and the Government in date of the contract, or until the total terms of units of work to be performed amount contributed by the Government, (per foot of drifting, per foot of drilling, with interest, is fully repaid, whichever etc.) in lieu of actual costs.

occurs first. (b) The Government will not con- (d) The Government's royalty shall be tribute to costs incurred before the date 5 percent of the "gross proceeds" (inof the contract, or to costs of or inci- cluding any bonuses, premiums, allowdent to:

ances, or other benefits) from the pro(1) Acquiring, owning or possessing duction sold, in the form sold (ore, land with any existing improvements, concentrate, metal, or equivalent) at the facilities, buildings, installations, and point of delivery (the f.o.b. point) exappurtenances, or the depreciation and cept, that charges of the buyer (not the depletion thereof;

operator or producer) arising in the reg(2) General overhead, corporate man- ular course of his business, and shown agement, interest and taxes (other than on the buyer's settlement sheets as depayroll and sales taxes);

ductions (such as treatment processes (3) Insurance (other than employers' performed by the buyer, sampling and liability or employees' compensation in- assaying to determine the value of the surance); and

production sold, and freight payable by (4) Damages to persons or property the buyer to a carrier (not the operator (other than authorized repair to or re- or producer) shall be allowed as deducplacement of equipment or other prop

tions in arriving at the “gross proceeds" erty used in the work).

as that term is used in this section. No

costs of the operator or producer are § 229.11 Repayment by the operator.

deductible in arriving at the "gross pro(a) If the Secretary considers that as ceeds” as that term is used in this seca result of the exploration, mineral or tion. The term “treatment processes”, metal production from the area covered as used in this paragraph means those by the contract may be possible, he shall processes (such as milling, concentratSO certify in writing to the operator ing, smelting, refining, or equivalent) within the time specified in the contract. applied to the crude ore or other pro

(b) When the Secretary determines duction after it is extracted from the not to certify, he shall promptly so notify ground to put it into a commercially the operator provided the operator has marketable form, excluding fabricating completed all obligations under the con- or manufacturing. tract.

(e) If any production (ore, concen(c) The operator shall pay the Gov- trate, metal, or equivalent) remains unernment a royalty on all minerals or sold or is not used by the operator or metals produced from the land described producer in integrated manufacturing in the contract and any other royalty as or fabricating operations (for instance, may be provided therein:

if it is stockpiled) after the lapse of six (1) Irrespective of any certification of months from the date it is extracted from possible production–from the date of the ground, the Government, at its opthe contract to the date of notice that tion, may require the computation and certification will not be made, or until payment of its royalty on the value of the total amount contributed by the such production in the form (ore, conGovernment with interest is fully repaid, centrate, metal, or equivalent) it is in whichever occurs first; or

at the time the Government elects to (2) Irrespective of any certification of exercise its option. If any production is possible production—if the Secretary, used by the operator or producer in deeming it necessary and in the public integrated manufacturing or fabricating interest, enters into an agreement to operations, the Government's royalty on provide for royalty payments.

such production shall be computed on (3) If a certification of possible pro- the "value” thereof in the form in which duction is issued-for a period of ten and at the time when it is used. “Value" years (or other period fixed by the con- as used in this section means what is or would be gross income from mining dates Federal funds are made available operations for percentage depletion pur- until the period specified for royalty payposes in Federal income tax determina- ments expires or until the amount of tion, or the market value, whichever is Federal funds contributed, including ingreater.

terest, is fully repaid, whichever occurs (f) (1) To secure the payment of the first. Government's royalty, the contract shall (b) The rate of interest shall be fixed provide for a lien upon the operator's by the Secretary at not less than the interest in the land, upon any production rate the Department of the Interior from the land, and upon any interests would be required to pay if it borrowed in the land other than the operator's from the Treasury, plus a two percent interest. However, the Secretary may interest charge in lieu of the actual cost accept the undertaking of a surety com- to the Government of administering the pany or third person in lieu of a lien contract. upon interests in the land other than (c) Paragraphs (a) and (b) of this the operator's interest. In circumstances section shall not be construed to inwhere the Secretary deems it to be in crease the rate of royalty or to extend the public interest, the requirement for the period for which the royalty is paya lien or other undertaking concerning able as set forth in § 229.11. interests in land, other than the lien upon the operator's interest, may be omitted

$ 229.13 Limitation on the amount of from the Contract.

Government participation. (2) If the operator is not the producer (for example, if the operator transfers

No single contract shall authorize or does not retain his interest in pro

Government participation in excess of duction or in the land), the operator

$250,000. shall remain liable for the payment of the Government's royalty.

(g) If, in any particular case, the § 229.14 Government not obligated to Secretary finds that it would be more

buy. economical or practicable to compute the

Nothing in this part or in any contract Government's royalty upon some basis entered into pursuant to this part shall other than “gross proceeds” or “value”,

be construed as imposing any obligation as these terms are used in this section, on the Government to purchase any maor upon the production in some form

terials mined or produced from the land other than that in which it is sold, held,

which is the subject of such contract. or used in integrated operations, he may agree with the operator, either in the original exploration contract or by an

$ 229.15 Title amendment thereof, upon some other

to and disposition of basis of computation.

property. (h) Nothing in this part shall be con

Facilities, buildings, fixtures, equipstrued as imposing any obligation on the ment, or other items or groups of items operator to engage in any mining or

(such as pipe, rail, steel, etc.), costing production operations.

more than $50.00 each, paid for or pur(i) The Secretary may modify and

chased with funds contributed jointly adjust the terms and conditions of any by the operator and the Government, contract to reduce the amount and although title may be taken in the name terms of any royalty payment when he of the operator, shall belong to the opershall determine that such action is nec

ator and the Government jointly, in essary and in the public interest.

proportion to their respective contribu

tions to the extent set forth in the con8 229.12 Interest on amount of Govern

tract. The exploration contract shall ment participation.

make suitable provisions also for their (a) Simple interest is calculated from disposal for the joint account of the opthe first day of the month following the erator and the Government.




DEFINITIONS Sec. 231.1 Authority, purpose, and scope of

the regulations in this part. 231.2 Definitions, 291.3 Powers and duties of mining super

visor. 231.4 General obligations of lessees.

MAPS AND PLANS 231.5 Maps and plans required prior to be.

ginning commercial operations; modification thereof; departure therefrom; operations in advance of approval thereof or not in con

formity therewith. 231.6 Requirements for maps of under

ground workings and surface operations and equipment; accuracy to be attested before notary

public; posting. 231.7 Other maps; what to be shown.

PROSPECT BORE HOLES 231.8 Submission of core or test bole rec

ords; cores, samples, cuttings, mill products; cementing and casing of drill boles.

WELFARE AND SAFETY 231.9 Sanitary, welfare, and safety ar

rangements. 231.10 Reports of accidents, inundations, or

fires to be promptly malled; fatal accidents and serious or threatening damages to be reported by

telegraph or telephone. 231.11 Protection of employees; mechani

cal equipment; dangerous walks or passages; moving parts of machinery or belts.

MINING METHODS 231.12 Lessee shall observe good practice. 231.13 Operations shall be conducted in a

Sec. 231.17 Dust, fumes, and acids. 231.18 Ventilation. 231.19 Inflammable gas and dust. 231.20 Explosives. 231.21 Electricity. 231.22 Fire protection. 231.23 Escape ways. MILLING; WASTE FROM MINING OR MILLING 231.24 Milling shall be in accord with ap

proved practices. 231.25 Disposal of waste from mining or


PRODUCTION RECORDS AND AUDIT 231.26 Books of account to be kept. 231.27 Sale price basis not less than highest

market price; Secretary of the In. terior may determine and declare

market price. 231.28 Audit of lessee's accounts and books

semiannually or at other times;

lessee to furnish audit free of cost. INSPECTION,


MENT OF ORDERS 231.29 Lessees shall provide means for in

spection of underground and surface conditions; surveying, esti

mating, and study. 231.30 Issuance of orders. 231.31 Service of notices, instructions, and

orders. 231.32 Enforcement of orders; suspension

of operations; temporary waiver of suspension order pending ap

peal and review. 231.33 Appeal; time allowed.

AUTHORITY: The provisions of this Part 231 issued under sec. 32, 41 Stat. 450, secs. 1, 1, 3, 5, 5, 44 Stat. 301, as amended, 1057, 710, 302, 1058, as amended, sec. 10, 61 Stat. 915; 30 U.S.C. 189, 271, 281, 293, 275, 285, 359.

SOURCE: The provisions of this part 231 contained in Operating Regulations, June 2, 1927, unless otherwise noted.


DEFINITIONS § 231.1 Authority, purpose, and scope

of the regulations in this part. (a) Pursuant to the authority vested in the Secretary of the Interior the regulations in this part have been issued to govern the methods of mining on the public domain for the discovery, mining, and treating of potash, oil shale, sodium, phosphate, sulphur, gold, silver, or quicksilver. The regulations in this part shall

manner to yield ultimate maximum recovery; information recorded and copy furnished district

mining supervisor. 231.14 Suficient pillars shall be left. 231.15 Working places; traveling way. 231.16 Mining or prospecting minerals sol

uble in water; brines; minerals taken in solution.

66-067 0-67-22

also apply to deposits of silica sand and other nonmetallic minerals within lands withdrawn by Executive Order No. 5105 of May 3, 1929, and to minerals in acquired lands (except coal, oil, and gas) under the regulations in 43 CFR Part 200. On and after July 1, 1944, the administration of the regulations in this part, save and except for those provisions dealing with inspections for the safety and welfare of miners engaged in operations covered by the regulations in this part shall be vested in the Geological Survey, Department of the Interior.

(b) Effective July 1, 1944, the function of making inspections for the safety and welfare of miners under the regulations in this part providing for such inspections shall be vested in the Bureau of Mines, Department of the Interior.

(c) The enforcement of the regulations in this part will remain the function of the Geological Survey. (13 F. R. 9496, Dec. 31, 1948)

CROSS REFERENCE: For leases of silica sands and other non-metallic minerals in certain areas in Nevada, see 43 CFR, Part 199. $ 231.2 Definitions.

The following terms used in the regulations in this part shall have the meanings here given:

(a) Mining supervisor (Chief, Mining Branch). The agent appointed by and acting for the Secretary of the Interior to supervise all prospecting and mining operations under the Mineral Leasing Acts.

(b) District mining supervisor, deputy mining supervisor, mining engineer. Any person appointed by the Secretary of the Interior to supervise, under the direction of the mining supervisor, prospecting and mining operations under the regulations in this part.

(c) Lessee. Any person or persons, partnership, association, firm, corporation or municipality, or State to whom a mining lease or permit is issued under the Mineral Leasing Acts.

(d) Leased lands, leased premises, or leased tract. Any lands or deposits occupied under lease or permit, granted in accordance with the Mineral Leasing Acts, for the purpose of prospecting for or mining potash, oil shale, sodium, phosphate, sulphur, gold, silver, or quicksilver.

§ 231.3 Powers and duties of mining

supervisor. It shall be the duty of the mining supervisor, individually or through his subordinates, and under the direction of the Director of the Geological Survey:

(a) Make inspectional visits; supervise operations to prevent waste or damage; promote safety, health, and welfare of workmen; issue necessary orders or instructions. To visit from time to time leased lands where operations for the discovery or mining or treating of potash, oil shale, sodium, phosphate, sulphur, gold, silver, or quicksilver are carried on or are to be conducted; to inspect and supervise such operations, including operations at accessory plants, for the purpose of preventing waste of mineral substances, or damage to formations or deposits containing them, and of promoting the safety, health, and welfare of workmen in accordance with the provision of the acts; and to issue, in accordance with the provisions of the lease and the regulations in this part, such necessary orders or instructions not in conflict with the laws of the State in which the leased lands are situated as will effectively carry out the purposes aforementioned.

(b) Make reports on condition of leased property and manner of operations; make recommendations for safeguarding lives and health of employees and protection of property. To make reports to the Director of the Geological Survey and to the Secretary of the Interior as to the general condition of the leased property and the manner in which operations are being conducted and orders or instructions are being complied with, and to submit from time to time information and recommendations for safeguarding and protecting the lives and health of the employees, the property, the minerals, and the mineralbearing formations.

(c) Prescribe manner and form of records, reports, and notices. To prescribe, subject to the approval of the Secretary of the Interior, the manner and form in which all records of operations, reports, and notices shall be made.

(d) Obtain and check records of production; report amount of production and value of accrued rentals and royal

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