The Economic Aspect of Geology Part 38

THE PROBLEM

Conservation of mineral resources may be defined as an effort to strike a proper balance between the present and the future in the use of mineral raw materials.

Mineral resources have been used to some extent as far back as evidences of man go, but great drafts on our resources have come in comparatively recent years. The use of many minerals has started within only a few years, and for others the acceleration of production within the past two or three decades has been rapid (see pp. 63-64). In general, the use of mineral resources on a large scale may be said to have started within the lifetime of men still active in business. The wide use of power necessary to an industrial age, the development of metallurgy, the increasing size and complexity of demands for raw material, mean that the intensive development and use of our mineral resources is in its infancy, and is in many respects in an experimental stage.

As nations have awakened to their need of mineral raw materials and to the recent rapid depletion of these materials, they have been naturally led to inquire how long the reserves may last, and to consider prevention of waste and the more efficient use of materials, with a view to planning more prudently for future national supplies. The first inquiries seemed to reveal such shortage of mineral supplies as to call for immediate and almost drastic steps to prevent waste, and possibly even to limit the use of certain minerals in the interests of posterity.

More careful study of the problem, as might be expected, revealed new factors and greater complexity. The conservational idea has a wide sentimental appeal, but the formulation and application of specific plans meet many difficulties. In its practical aspects the problem is now a live one, the solution of which is requiring the attention of mining men, engineers, geologists, economists, and public officials. It is a question which is coming more and more into the field of actual professional practice of the economic geologist.

It is our purpose to indicate the general nature of the conservation problem. We may a.s.sume agreement to the desirability of preventing waste, of making a wise present use of mineral products, and of striking a proper balance between the present and future in their use. Nature has taken many long geologic periods to build up these reserves. We, of the present generation, in a sense hold them in trust; they are entailed to our successors. With this general thought in mind, how shall we proceed to formulate definite plans for conservation?

An initial step is obviously a careful taking of stock. With increasing knowledge of mineral resources, it is becoming apparent that early estimates of supplies were too low. Many of these estimates failed to take into account mining to great depths, and wide use of low-grade ores, rendered possible by improved methods; and especially they failed to put sufficient emphasis on the probabilities of new discoveries to replace exhausted supplies. Early predictions have already been upset in regard to a number of mineral resources. The recognition of the general fact that the world is far from explored in two dimensions, to say nothing of three, of the fact that known geologic conditions do not yet indicate definite limits to the possibilities of exploration for most mineral resources, and of the consequent fact that for a long time in the future, as in the past, discoveries of new mineral deposits will be roughly proportional to the effort and money spent in finding them,--which means, also, proportional to the demand,--makes it impossible, for most of the mineral resources, to set any definite limits on reserves. It is comparatively easy to measure known reserves; but a quant.i.tative appraisal of the probable and possible reserves for the future is extremely difficult. Successive revisions of estimates have, with but few exceptions, progressively increased the total mineral supplies available. The result is that the time of exhaustion has been pushed far into the future for most of the important minerals, thus minimizing the urge for immediate and drastic conservational action, which followed naturally from early estimates of very limited supplies.

For both coal and iron, supplies are now known for hundreds or even thousands of years. For oil and lead, on the other hand, the reserves now known have a life of comparatively few years, but the possibilities for successful exploration make it probable that their life will be greatly extended. Notwithstanding this tendency to lengthen the exhaustion period, the limits of mineral resource life are still small as compared with the life of the nation or of civilization,--and the fundamental desirability of conservation is not materially affected.

It is not easy to predict the rate of production for the future. At the present rate of coal production in the United States, the supplies to a depth of 6,000 feet might last 6,000 years; but if it be a.s.sumed that the recent _acceleration_ of production will be continued indefinitely into the future, the result would be exhaustion of these supplies in less than 200 years. It is generally agreed that exhaustion will come sooner than 6,000 years, but will require more time than 200 years. The range between these figures offers wide opportunity for guessing. It is supposed that per capita consumption may not increase as fast in the future as in the past, that possibly an absorption point will be reached, and that there will be limits to transportation and distribution; but how to evaluate these factors no one knows. In the case of some of the metallic resources, such as iron, the fact that the world's stock on hand is constantly increasing--losses due to rusting, s.h.i.+p-wrecks, etc., being only a small fraction of the annual output--suggests that a point will be reached where new production will cease to accelerate at the present rate and may even decline. But again, the factors are so complex and many of them so little known, that no one can say how soon this point will be reached.

For the immediate future, there is little to be feared from shortage of mineral supplies in the ground. The difficulties are more likely to arise from the failure of means to extract and distribute these supplies fast enough to keep up with the startling acceleration in future demand indicated by the figures of recent years. The speed and magnitude of recent material developments in many lines cannot but raise question as to whether we have the ability to understand and coodinate the many huge, variable, and accelerating factors we have to deal with, or whether some of the lines of development may not get so far ahead of others as to cause serious disturbance of the whole material structure of civilization. Coal alone, which now const.i.tutes a third of our railway tonnage, may with increased rate of production require two-thirds of present railway capacity. Will railway development keep up? It may be noted that national crises and failures in the past history of the world have seldom, if ever, been due to shortage of raw materials, or in fact to any failure of the material environment.

In its early stages the conservation movement in this country concerned itself princ.i.p.ally with the raw material. Later there came the recognition of the fact that conservation of raw materials is closely bound up with the question of conservation of human energy. The two elements in the problem are much like the two major elements in mineral resource valuation (see pages 329-330). If in saving a dollar's worth of raw material, we spend two dollars worth of energy, it naturally raises question as to the wisdom of our procedure. It might be wiser in some cases to waste a certain amount of raw material because of the saving of time and effort. It might be better for posterity to have the product of our energy multiplied into raw material than to have the raw material itself. The valuation of these two major elements of conservation is again almost impossible of quant.i.tative solution. We do not know what is the best result to be aimed for. We cannot foresee the requirements of the future nor the end toward which civilization is moving--or should move. The extravagance of the United States is often contrasted unfavorably with the thriftiness of Europe. When considered in relation to raw materials alone, there seems to be basis for this charge. When considered in relation to the product of human energy into raw materials, the conclusion may be far different; for the output per man in the industries related to mineral resources is far greater in the United States than in Europe. In the case of iron, it has been estimated that the output per man in the United States is two and one-half times as great as in the rest of the world. Which is best in the true interests of conservation, we are not yet able to see.

Our view of what is desirable in the way of conservation depends somewhat on the limitations imposed by self-interest or location. By devoting ourselves exclusively to one mineral resource, we might work out a conservation program very disadvantageous to the best use of some other mineral commodity. We might take steps to conserve chromite in the United States which would have a disastrous effect on the iron and steel industry. We might conserve coal by the subst.i.tution of oil, when the procedure is hardly warranted by the supplies of oil available. We might work out a program for the United States which would not be the best conservational plan for the world as a whole, and which would ultimately react to the disadvantage of the United States. The wisest and most intelligent use of mineral resources seems to call unquestionably for their consideration in their world relations, rather than for a narrow interpretation of local requirements.

DIFFERENCES BETWEEN PRIVATE AND PUBLIC EFFORTS IN CONSERVATION

It appears that a wide range of effective conservational practices has resulted solely from the effort to make more money through more efficient operations, and this is likely to be true in the future. Many improvements in mining, grading, sorting, concentration, and metallurgy of minerals, to yield larger financial returns, are coming naturally through private initiative, under the driving power of self-interest.

Another considerable group of conservational practices is possible only to governments or other public agencies. This group of practices on the whole requires some sacrifice of the immediate financial interest of the individual, in the interests of the community as a whole, or in the interests of posterity. In this group may be mentioned the compulsory use of methods of mining, sorting, and metallurgy which tend to conserve supplies but result in higher prices; the control of prices; the elimination or lowering of the so-called resource or royalty value (p.

375); and the removal of restrictions on private combination or cooperation, leading to more efficient methods, lessening of cost, and better distribution of the product; or, what might amount to the same thing, the acquirement by the government of the resources to be operated on this larger scale.

The most effective conservation measures yet in effect are the ones dictated by self-interest and inst.i.tuted by private initiative.

Governmental measures are not yet in effective operation. Ill.u.s.trations of these two types of conservational effort are cited in relation to coal on later pages.

THE INTEREST RATE AS A GUIDE IN CONSERVATION

In striking a balance between the present and the future, economists have emphasized the importance of recognizing the interest rate as a guiding, if not a controlling consideration. It is obviously difficult for private capital to make investments of effort and money for the purpose of conservation which will not be returned with interest some time in the future. For the present, at least, this consideration furnishes the best guide to procedure in the field of private endeavor.

So far as conservational measures, such as investment in an improved process of concentrating low-grade ores, promise return of capital and an adequate interest rate in the future, they are likely to be undertaken.

It is clear that governments are not so closely bound by this economic limitation. They can afford to carry their investments in raw materials and processes at a lower interest rate than the private investor. Their credit is better. Taxes do not figure so directly. They can balance losses in one field against gains in another. As a matter of insurance for the future of the nation, a government may feel justified in inaugurating conservational measures for a particular resource without hope of the interest return which would be necessary to the private investor. In appraising the iron ores of Lorraine taken over by France from Germany at the close of the war, the actual commercial value of these ores, as figured by the ordinary _ad valorem_ method, was only ninety millions of dollars. It is clear, however, that to France as a nation the reserves were worth more. They could afford to pay more for them, and could afford to spend more money on conservational practice than under ordinary commercial limitations, because of the larger intangible and more or less sentimental interest.

The valuation of this larger interest, as a means of determining the limit to which conservational investments may be made, lies in the political field. It may be suggested, however, that a desirable first step in any governmental program of conservation is to ascertain the cost and the possibility of an adequate return of capital and interest.

These determinations at least afford a definite point of departure, and a means for measuring the cost to the people of measures which are not directly self-supporting.

ANTI-CONSERVATIONAL EFFECTS OF WAR

Experience during the recent past indicates that the exploitation of mineral resources for war purposes is on the whole anti-conservational.

It is true that the vast amount of war-time exploration and development, as well as the thoroughgoing investigations of the utilization of various minerals, have led to better knowledge of the mineral resources and their possibilities. It is also true that the war required a much more exhaustive census of mineral possibilities than ever before attempted. The immediate and direct effect of the war, however, was the intensive use of mineral resources without careful regard to cost, grade, or many other factors which determine their use in peace times.

For instance, in ordinary times considerable quant.i.ties of high-phosphorus iron ores are mined; but, because of the fact that such ores require more time for conversion into steel, war-time practice concentrated on the higher-grade, low-phosphorus ores, resulting in an unbalanced production which in some cases amounted almost to robbing of ore deposits. In the case of coal, quant.i.ty was almost the only consideration; it was impossible to grade and distribute the coal to meet the specialized demands of industry. The results were a general lowering of the standards of metallurgical and other industrial practices, and increased cost. High-grade coals were used where lower-grade coals were desirable for the best results. In the making of steel, it is the custom to select the coal and c.o.ke with great care in regard to their content of phosphorus, sulphur, ash, and other const.i.tuents which affect the composition of the steel product; but during the war it became necessary to accept almost any kind of coal, with a resulting net loss in quant.i.ty and in grade of output.

For a considerable number of mineral resources, such as the ferro-alloys, foreign sources of supply were cut off during the war, requiring the development and use, at high cost, of low-grade scattered supplies in the United States. It was found possible to produce enough chromite in the United States for domestic requirements, but at two or three times the normal price of imported chromite. The grade was low and the loss in efficiency to the consuming interests was a high one. The extremely limited natural supplies were raided almost to the point of exhaustion.

With the post-war resumption of importation of minerals of this kind, producers naturally began a fight for a protective tariff, and the question is yet unsettled. The tariff, if enacted, would in most cases have to be a high one in order to permit the use of domestic supplies.

The results would be a large increase in cost to other industries, decreased efficiency, and the early exhaustion of limited supplies in this country. Most of the mineral resources have been concentrated by nature in a comparatively few places in the world; and when the two elements of conservation are considered--the materials themselves and the human energy expended in obtaining and using them--it is clear that any measure which interferes with the natural distribution of the favored ores is anti-conservational from the world standpoint.

CONSERVATION OF COAL

In the sections on mineral resources, there are many casual references to conservation of specific minerals. Here we shall not go further than to introduce a brief discussion of the conservation of coal as ill.u.s.trative of the general problem of conservation of mineral resources.

It has been estimated that the United States possesses, to a depth of 3,000 feet, in beds 14 inches or over, 3,538,554,000,000 tons of coal, and an additional reserve between 3,000 and 6,000 feet of 666,600,000,000 tons.[42] If all the unmined coal to a depth of 3,000 feet could be placed in one great cubic pile, the pile would be 18 miles long, 18 miles wide, and 18 miles high. Of the original amount of coal to this depth only about 0.4 of 1 per cent has been mined or wasted in mining. The wastage is estimated at about 50 per cent. If the annual production of coal were to remain the same as in recent years, the total life of the coal reserves (to a depth of 3,000 feet) would be between 4,000 and 6,000 years; but if the acceleration of production of recent years were to be maintained in the future, the life would be but little over 100 years, and the life of the highest-grade coal now being mined might not be over 50 years. All agree that the acceleration of production is not likely to continue indefinitely, which will mean that the life of coal reserves to 3,000 feet will be somewhere between the two extremes named. It seems clear that actual shortage of coal will not be felt for some hundreds of years; but this period of years is short as compared with the probable life of the race.

MEASURES INTRODUCED OR PROPOSED TO CONSERVE COAL

The following list of measures for conservation of coal is taken from several sources. The exhaustive report of the British Coal Commission,[43] published in 1905, contains a considerable number of specific recommendations for conservation of the coal of Great Britain.

The reports of the National Conservation Commission[44] of the United States, published in 1909, treat of the conservation of the coal of the United States and naturally follow some of the recommendations of the British report. The coal section of the National Conservation report was prepared by M. R. Campbell and E. W. Parker of the U. S. Geological Survey, and is contained in U. S. Geological Survey Bulletin 394. The recommendations there given are amplified and developed by Van Hise[45]

in his book on Conservation, published in 1910. Since that time the subject has been discussed by Smith, Chance, Burrows, Haas,[46] and others, and certain additional conservational methods have been proposed. A considerable number of men have also discussed the sociologic and economic aspects of the question. The report of the Conservation Commission of Canada,[47] published in 1915, treats rather fully of the conservation of mineral resources.

It will suit our purpose, and avoid some repet.i.tion, if we group most of these recommendations without regard to authors.h.i.+p. In general, these recommendations can be grouped under the heads: (A) Methods of mining and preparation of coal; (B) Improvement of labor and living conditions at the mines; (C) Introduction or modification of laws to regulate or to remove certain restrictions on the coal industry; (D) Distribution and transportation of coal; (E) Utilization of coal; (F) Subst.i.tutes for coal as a source of power.

=(A) Mining and preparation of coal.= Under this heading may be included a large number of proposals which concern primarily the engineering treatment of the coal underground and in the mine plants. Some of the more important measures are:

1. Introduction of the long-wall system of mining in places where the conditions allow it, in order to minimize the waste underground.

2. Modification of the room-and-pillar system of mining, by which larger pillars are left while the mine advances, and are recovered in the retreat,--thereby recovering a larger percentage of coal than under the old system, where small, thin pillars were left, which failed and were permanently lost.

It has been argued that the great loss of coal by leaving it in pillars could be saved by using other material to support the roof; but an elementary calculation of the cost of this procedure shows that it is cheaper to use the coal. Chance[48] says:

The coal left as pillars to support the roof is thus utilized and performs a necessary and useful function, yet the princ.i.p.al part (perhaps two-thirds) of the 200,000,000 tons our friends the conservationists claim is wilfully and avoidably wasted every year is this coal that is left in pillars to support the roof. I think we can safely claim that this is not waste, but, on the contrary, is engineering efficiency of the highest type, in that it utilizes the cheapest and least valuable material available to support the roof and saves the whole labor cost of building supports of other materials. Investigation as to what becomes of that part of the 200,000,000 tons claimed as wasted, which is not utilized as pillars to support the roof, will disclose the fact that a very large portion is coal that is left in mine workings that are abandoned because the roof is unsafe and because a continuance of operation would result in injuries or loss of life. Coal left in the mines in order to conserve human lives cannot be cla.s.sed as avoidable waste. A small part of the 200,000,000 tons is lost because it is intimately mixed with refuse and because the labor cost of recovering it and separating it from the refuse would be greater than its value.

3. Mining of shallow bituminous beds by means of the steam shovel.

Progress has been made along this line in the last few years, and valuable deposits are thus mined which can be mined profitably by no other method.

4. New methods of filling mined-out s.p.a.ces with sand, and new methods of mine survey and design. According to Haas[49]

the greatest advance in the question of method was the system of mine survey and design perfected in both the anthracite and bituminous fields. The relatively new method of filling old s.p.a.ces with sand, etc., has also achieved success.

5. Use of methods by which coal is not left in the roof for the support where the roof is weak, and by which coal of inferior quality is not left in the roof.

6. Wider use of coal-cutting machines by which the wasting of thinner beds may be avoided.

7. Where conditions allow it, the working of the upper beds before the lower, in order not to destroy the upper ones by caving. The mining of a lower coal seam has often so broken up the overlying strata as to render it impossible to recover the upper coal seams contained therein. There are certain difficulties, however, in the way of this conservational measure. In some localities the seams are under separate owners.h.i.+p, and there is a resulting conflict of interests. Also, if the better coal seam happens to be below and the poorer seams above, market conditions may require that the lower seam be mined regardless of the destruction of the upper ones.

8. Elimination of coal barriers to mark the limits between properties.

This involves more cooperation.

9. Improvement of mining machinery, power drills, etc.