U.S. REPORT Mining industry in U.S. preparing to fight proposed

The U.S. mining industry “never before has faced as many challenges” as it does this year, according to the chairman of the American Mining Congress (AMC), Milton Ward, who also is president of Freeport-McMoRan (NYSE). Speaking here at the annual “members meeting” of the AMC, Ward said, “There are some in this country who would close down mining altogether.” He added that “there’s no doubt that the ability of the mining industry to compete . . . could beseverely handicapped by proposed changes in the general Mining Law.”

Harr Conger chairma o Homestak Minin (NYSE an a AM vice-chairman, said the number one industry issue “is the attempt by a powerful few to limit access to public lands, which currently exists under the Mining Law of 1872.”

Conger pulled no punches about what would happen to the U.S. mining industry if the Mining Law is radically changed or eliminated. He said such “action would eventually result in the death of the domestic mining industry.”

Representative Nick Joe Rahall II, chairman of the House’s mining and natural resource subcommittee, and Senator Dale Bumpers, chairman of the Senate’s public lands subcommittee, have both introduced legislation to replace the Mining Law.

While the Mining Law was passed by Congress more than 100 years ago, it has been updated more than 50 times since. The AMC maintains that as a consequence of these changes, the Mining Law is as current today as it was when first written.

To underscore how seriously the U.S. mining industry views the legislative changes proposed, Allen Born, chairman of Amax (NYSE) and chairman of the AMC finance committee, in discussing the AMC budget for 1991, indicated that the trade association would bespending about US$1 million on that issue alone this year, out of a total budget of around US$8 million, including special assessments.

The next most serious issue facing the U.S. mining industry is mine waste. Leonard Judd, president of Phelps Dodge(NYSE) and another AMC vice-chairman, said “reauthorization of the Resource Conservation and Recovery Act, which covers mine waste, is a real possibility during this congress.”

The AMC maintains that the Act should be amended only to create a stronger and more clearly defined partnership between federal and state governments, Judd said.

Mining wastes, according to Judd, should not be subject to the same regulatory requirements as hazardous and chemical wastes. He added that “the underlying principle of any mining amendments should be the continuation of state primacy.” Judd also pointed out that two other laws, the Clean Water Act and the Safe Drinking Water Act, are scheduled for reauthorization.

Thomas Moore, chairman of Cleveland-Cliffs(NYSE),discussed tax issues at the AMC meeting. He said the mining industry shoulders a disproportionate share of the tax burden.

“Specially designed tax incentives are necessary to attract the high-risk investments necessary to find, develop and produce minerals,” he said.

Such incentives, he pointed out, include the percentage depletion allowance, a full deductibility of mine exploration and mine development costs, and stimulative capital cost recovery system.

Moore also criticized proposed special environmental and industrial energy taxes. “We cannot afford to tax away America’s industrial strength with short-sighted legislation,” he said.

The importance of international trade to the U.S. mining industry was discusse b Richar d J Osborne chairma o Asarc (NYSE an an AMC vice-chairman.

Osborn pointe ou tha th U.S minin industr wen throug wrenchin restructurin an cost-cuttin i th 1980 an i now internationally competitive.

Bu Osborn sai tha th U.S minin industr “canno b expecte t compet agains foreig companie whos productio i heavily subsidized.”