of capital investments and result in a minimum cost per unit of production of the ores produced.

(b) In consideration of the facts set forth in paragraph (a) of this section, and wherever practicable and conformable with the purposes and provisions of this Act, the Director, acting through and with the approval of the Reconstruction Finance Corporation, until June 30, 1953, and thereafter, at his discretion, shall contract for the production of ores pursuant to the provisions of this Act in any case where

(1) it is doubtful that capacity production could be attained within four years from the date of a producer's application or the commencement of exploration, engineering studies, or process development by a producer, whichever is the earlier;

(2) the return of the producer's capital investment would require a longterm period of production; or

(3) the cost per unit of the ores produced or to be produced by a particular producer would be materially reduced by providing a long-term period for production.

Notwithstanding the provisions of section 36, contracts may be made for periods up to but not to exceed fifteen years following the enactment of this Act: Provided, That such contracts shall not be made to a new producer after seven years following the enactment of this Act.

ORE PURCHASES AND STOCK PILING

SEC. 32. (a) The Reconstruction Finance Corporation shall purchase, at prevailing market prices or values

(1) the total ore production of a producer wholly dependent upon incentive payments to sustain operations;

(2) all ores produced and shipped pursuant to subsections 10 (a), 11 (a), 12 (a), 13 (a), 14 (a), 15 (a), and 16 (c) (1);

(3) the particular or equivalent quantity of ores produced through incentive payments by (i) blending marginal and otherwise wasted ores with the high-grade ores or those which normally would be mined at a profit by the producer, and (ii) mining and salvaging particular ore bodies or blocks of ore which otherwise would not be mined and recovered;

(4) all ores offered pursuant to section 17; and

(5) all ores obtained through contracts made pursuant to section 31 of this Act: Provided, That in lieu of particular ores produced pursuant to this Act, the produced may ship an equivalent quantity of the same kind of type of ores in form and grade satisfactory to the Reconstruction Finance Corporation.

All ores purchased by the Reconstruction Finance Corporation pursuant to this Act shall be transferred to the national stock pile established pursuant to Public Law 520 (Seventy-ninth Congress, ch. 590, second session).

(b) The Bureau of Federal Supply of the Treasury Department shall reimburse the Reconstruction Finance Corporation to the extent of the current market or purchase price, free on board point of rail shipment nearest mines, processing plants, purchase depots, smelters, refineries, or markets, as the case may be, for all ores transferred to the national stock pile under this section and for all expenses incurred in the transportation, care, and handling of such ores.

INFORMATION TO PRODUCERS

SEC. 33. (a) Each producer shall receive a copy of all calculations and analyses and all other information or determinations used as a basis for each individual assignment, revision, or denial of incentive payments, contracts, or exploration allowances which pertain to the producer's operations.

(b) Copies of all rules, regulations, and policies and changes therein shall be furnished to each producer registered with the Office of National Minerals Development and shall be published in the Federal Register.

REPORTS TO CONGRESS

SEC. 34. The Director shall submit to the Congress, not later than January 30, 1950, and every six months thereafter, a complete and nonconfidential report detailing all the activities and results obtained and expected pursuant to this Act, and such other pertinent information concerning the administration of this Act as will enable the Congress to evaluate its administration and the need for amendments and related legislation.

APPROPRIATIONS

SEC. 35. (a) All disbursements for incentive payments, exploration allowances, contracts, freight allowances, treatment of ores and all direct expenses incidental thereto, reimbursements for services, investigations, surveys, testing, and metallurgical research, as authorized by this Act, but not including disbursements and purchases of ores reimbursable by the Bureau of Federal Supply pursuant to section 32, shall be made by the Reconstruction Finance Corporation and shall not exceed $100,000,000 in the fiscal year 1950, and thereafter, such sums as the Congress, from time to time, may deem necessary to carry out the purposes and provisions of this Act.

(b) There are hereby authorized to be appropriated sums sufficient to carry out the administration of this Act.

EXPIRATION DATE

SEC. 36. Except as otherwise provided pursuant to section 31 of this Act, the provisions of section 33 (d) shall expire June 30, 1959.

EXHIBIT 6

[SUBCOMMITTEE NOTE.-H. R. 2406 is identical to H. R. 2031 except for several changes in sec. 11]

81ST CONGRESS

1ST SESSION

H. R. 2406

IN THE HOUSE OF REPRESENTATIVES

FEBRUARY 7, 1949

Mr. MILLS introduced the following bill; which was referred to the Committee on Public Lands

A BILL

To stimulate exploration, development, mining, production, and conservation of strategic and critical minerals and metals within the United States and its Territories; to establish an Office of National Minerals Development, Production, and Conservation within the Department of the Interior; and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "National Minerals Development and Conservation Act of 1949".

FINDINGS OF FACT

SEC. 2. (a) Recognizing that the strength and prosperity of the United States depends at all times upon an assured supply of strategic and critical minerals and metals to meet the essential civilian, industrial, and military needs of the Nation, the Congress finds that

(1) large geographic areas of the world progressively are being withdrawn as assured sources of peacetime supply. Shipments from these sources may be curtailed or terminated at any time;

(2) the United States continues to depend on many overseas sources of supply for highly strategic materials that could be obtained under favorable conditions entirely or in large measure from undeveloped domestic deposits; (3) attempts to procure minerals and metals from overseas sources in time of war is hazardous and costly in the extreme-accomplished only by (i) the assignment of combat vessels, ground forces, and facilities needed elsewhere to protect shipments and sources of supply, (ii) the diversion of ships and aircraft needed for the transport of personnel and supplies required by the armed forces, and (iii) the inevitable loss of lives, ships, and cargoes;

(4) sharp and progressive curtailment of domestic mine production and development is experienced with increasing manpower, equipment, and materials shortages following the outbreak of war;

(5) the time required, as well as critical shortages of manpower and materials, prevents the effective development, mining, and utilization of unworked domestic mineral deposits following the outbreak of war emergencies. Major attempts to utilize such deposits during World War II were unsuccessful;

(6) may delays and set-backs in the war production and military programs as well as the postwar recovery period were caused by shortages of strategic and critical minerals and metals-adding incalculably to the cost of World War II and to the inflation experienced during the past three years;

(7) experience has proved that official estimates of mineral and metal requirements made prior to and during the early years of a war are rendered obsolete from time to time by increasing demands resulting from the development of new military uses, unforeseen events or conditions, and changing military strategy;

(8) the duration of a war and civilian industrial needs following a war, both being vital requirement factors, are indeterminable at the outset of hostilities;

(9) to plan and depend on overseas and distant sources for the wartime procurement of substantial quantities of any strategic and critical minerals and metals that can be made available from domestic deposits, if given time and an adequate stimulus during peacetime, is a great risk that the United States need not and cannot afford to assume;

(10) strategic and critical minerals and metals are nonperishable and never become obsolete. When placed in Government stock piles they rep resent an investment having a completely recoverable market value as well as an indispensable investment for the security of the people of the United States.

(b) Recognizing the problems peculiar to the development and mining of domestic mineral deposits and the precarious position of large segments of mining industries producing highly strategic and critical minerals and metals, the Congress also finds that

(1) comparatively few domestic deposits of the minerals and metals named in section 7 of this Act normally can be mined effectively except during prolonged periods of shortages and high prices for such materials; (2) many mines have been closed since World War II as the result of high mining costs, inadequate market prices, depletion of developed ore reserves, or other economic factors beyond the control of the producers;

(3) most domestic mines now producing strategic and critical minerals and metals will be closed and abandoned following a decline in demand or prices unless preventive measures are taken by the Federal Government;

(4) under the stimulus of assured and adequate prices, substantial production, and in some cases complete self-sufficiency for wartime requirements, could be obtained from numerous undeveloped or abandoned mineral deposits in the United States;

(5) the orderly and effective exploration, development, and mining of a mineral deposit on a moderate scale generally requires a number of years before capacity production is obtained;

(6) a great waste of the Nation's mineral resources occurs when economie factors compel the selective mining of only the richest portions of mineral deposits and, with the closing of underground mines, when the flooding or caving of mined workings prevent the future recovery of remaining ore bodies or the future discovery of unknown ore bodies.

DECLARATION OF OBJECTIVES

SEC. 3. (a) Mindful of the findings of fact set forth in section 2 of this Act and resolving that all available means be taken to strengthen and fully insure the economic welfare and security of the people of the United States against the inevitable consequences of dangerous and costly shortages of strategic and critical minerals and metals, the Congress hereby declares that the immediate objectives of this Act are to stimulate the exploration, development, mining, production, and conservation of strategic and critical minerals and metals within the United States and its territories through private enterprise, by pro

viding assured markets and adequate prices over a necessary minimum period of time which will

(1) assure the continuance of production from all mines now operating— to the extent possible within the limitations of this Act;

(2) enable the reopening and operation, where possible, of mines now closed, and the orderly and effective exploration, development, and mining of undeveloped deposits;

(3) provide inducements for the planning, development, and installation of facilities for the mining and processing of low-grade ores to high-grade products;

(4) conserve mineral resources by means which will encourage the recovery and utilization of other otherwise lost through wasteful mining and metallurgical practices or as a result of economic conditions beyond the control of producers; and

(5) result in the accumulation and stock piling of all strategic and critical minerals and metals produced and obtained pursuant to the provisions of this Act for the account of the United States Government.

(b) Mindful that the future economic welfare and security of the people of the United States also require the continued procurement and stock piling of strategic and critical minerals and metals in such quantities as may be obtainable from any available source, the Congress hereby declares that it is not the intent of this Act to impair the procurement of strategic and critical materials pursuant to Public Law 520 (Seventy-ninth Congress, second session) in any degree whatsoever.

OFFICE OF NATIONAL MINERALS DEVELOPMENT

SEC. 4. (a) There is hereby created within the Department of the Interior an Office of National Minerals Development, Production, and Conservation, hereinafter called the "Office of National Minerals Development."

(b) The administrators of the Office of National Minerals Development shall be a Director and an Assistant Director suitably qualified in actual administrative and mining experience who shall be appointed by the Secretary of the Interior. The Director and Assistant Director shall receive compensation at the rate of $15,000 and $12,000 per annum, respectively. The Assistant Director shall perform such duties as the Director may designate, and shall be the Acting Director of the Office of National Minerals Development during the absence or disability of the Director or in the event of a vacancy in the office of Director.

(c) It shall be the duty of the Director, and he is hereby authorized and directed, (1) to perform the functions hereinafter specifically authorized and (2) to prescribe such rules and regulations as may be necessary and proper to carrying out the purposes and provisions of this Act in the simplest manner. (d) The Office of National Minerals Development may select and employ such engineers and experts and other personnel as may be necessary to carry out the purpose and provisions of this Act. Of such personnel employed by the Office of National Minerals Development, not to exceed eighty may be compensated without regard to the civil-service laws and the provisions of the Classification Act of 1923, of whom not more than twenty may be compensated at a rate in excess of $10,000 per annum, but not in excess of $12,000 per annum. Experts and consultants or organizations thereof, as authorized by section 15 of the Act of August 2, 1946 (U. S. C., title 5, sec. 55a), may be employed by the Office of National Minerals Development, and individuals so employed may be compensated at rates not in excess of $50 per diem and while away from their homes or regular places of business, they may be paid actual travel expenses and not to exceed $10 per diem in lieu of subsistence and other expenses while so employed.

TRANSFER OF RECORDS

SEC. 5. All records of the former Office of Premium Price Plan for Copper, Lead, and Zinc are hereby transferred to the Office of National Minerals Development.

SEC. 6. As used in this Act

DEFINITIONS

(a) ORES.-"Ores" mean and include ores, concentrates, sinters, mattes, nodules, briquettes, ferro-alloys, metals, minerals, or other convertible or usable raw materials of minerals and metals, and any such products recovered from mine dumps, mill tailings, slag piles, and residues.

(b) NEWLY MINED ORES.-"Newly mined ores" means ores accumulated in or removed from mine workings subsequent to the enactment of this Act.

(c) NEWLY PRODUCED ORES.—"Newly produced ores” means ores produced subsequent to the enactment of this Act.

(d) CONSERVATION.-"Conservation," as used in the organic law stipulating the functions of the Bureau of Mines, means "conserving resources through the prevention of waste in the mining, quarrying, metallurgical, and other mineral industries."

(e) PRODUCER.-"Producer" means any person, firm, corporation, or association by whom or for whose account and interests a particular mine or property or particular group of mines or properties is being explored, developed, mined, or otherwise prepared or utilized for the production of ores.

(f) PRODUCES AND SHIPS.-"Produces" means to obtain by (i) mining, (ii) mining and beneficiating and/or processing, or (iii) recovering from mine dumps, mill tailings, slag piles, and residues, whether or not entailing beneficiation and/or processing. "Ships" means to transport or commit for transportation or to dispose of as directed by the Reconstruction Finance Corporation.

(g) STRATEGIC AND CRITICAL MINERALS AND METALS.-"Strategic and critical minerals and metals" means those raw or semiprocessed minerals and metals that are required for essential uses in war and postwar recovery emergencies, and whose procurement in adequate quantities, quality, or time is sufficiently uncertain for any reason to require prior provision for their supply.

QUALIFYING MATERIALS

SEC. 7. To carry out the purposes of this Act, development, production, and conservation payments, hereinafter called "incentive payments," shall be made hereunder to domestic producers for newly produced ores of antimony, asbestos, bauxite, beryllium, chromium, cobalt, columbium, copper, corundum, graphite, kyanite, lead, manganese, mercury, mica (except ground mica), monazite, nickel, rutile, talc (steatite), tantalum, tin, tungsten, vanadium, zinc, and zirconium, together with the ores of any minerals or metals that subsequently may be included by the Director.

CRITERIA FOR APPLYING INCENTIVE PAYMENTS

SEC. 8 (a) Within the terms and limitations provided in this Act, incentive pay. ments shall be made, where and to the extent required, in such amounts or at such rates as are necessary to encourage and permit the production, development, and conservation of ores at any mine or property, to make adequate allowance for all legitimate costs, including depreciation, full percentage depletion, amortization, and such exploration and development work as may be considered normal or reasonably necessary and consistent with recognized mining practice, and to provide the producer with a reasonable margin of profit per unit of production based on direct operating costs and grade of ore and commensurate with the risks, hazards, and uncertainties inherent in the particular venture and mining in general.

(b) Incentive payments for newly produced ores shall be the amounts per unit of production that are paid to the producer over and above and in addition to the unit market prices or values received or to be received by the producer from the Reconstruction Finance Company or its designated agents, and all domestic producers shall, on application to the Office of National Minerals Development, be eligible to receive such incentive payments as may be required to effectuate the purposes and provisions of this Act.

(c) For the purposes and application of the provisions of this Act, each particular mine or property or particular group of mines or properties held by the same producer and mined or worked in fact as a single or consolidated operation shall be considered and treated on an individual basis, regardless of the number of such operations conducted by a producer. Small-producer incentive payments determined pursuant to sections 10, 11, 12, 13, 14, 15, and subsection 16 (e) shall be assigned on the same individual mine or operation basis.

EXPLORATION ALLOWANCES

SEC. 9. (a) (1) Exploration allowances assigned hereunder to domestic producers of newly mined ores shall be in addition to incentive payments and without regard to the incentive payment limitations defined in this Act.