Walter Youngquist: Geodestinies Minerals

Posted on March 23, 2021 by

Preface. I was fortunate enough to know Walter for 15 years. He became a friend and mentor, helping me learn to become a better science writer, and sending me material I might be interested in, and delightful pictures of him sitting in a lawn chair and feeding wild deer who weren’t afraid of him. I thought his book Geodestinies: The Inevitable Control of Earth Resources over Nations and Individuals, published in 1997, was the best overview of energy and natural resources ever written, and encouraged him to write a second edition. He did try, but he spent so much time taking care of his ill wife, that he died before finishing it. I’ve made eight posts in Experts/Walter Youngquist of just a few topics from the version that was in progress when he died at 96 years old in 2018 (500 pages).

Other Youngquist Geodestinies Posts:

Alice Friedemann www.energyskeptic.com  author of “Life After Fossil Fuels: A Reality Check on Alternative Energy“, 2021, Springer; “When Trucks Stop Running: Energy and the Future of Transportation”, 2015, Springer; Barriers to Making Algal Biofuels, and “Crunch! Whole Grain Artisan Chips and Crackers”. Podcasts: Collapse Chronicles, Derrick Jensen, Practical Prepping, KunstlerCast 253, KunstlerCast278, Peak Prosperity , XX2 report

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Political risks of depending on other nations for oil, metals, and minerals

As countries such as Great Britain and the United States industrialized, initially most raw materials needed were available within the country. But gradually, these resources were depleted and the companies producing these resources had to go abroad to less developed countries for raw materials. Many of these governments were, and remain, to be unstable. The degree of risk depends on the relative stability of governments and the politics within these countries. A continuing civil war is not helpful to oil or mining operations: examples being Angola, Colombia, and Nigeria. The risks can be enormous, and range from the destruction of the resource producer’s equipment, kidnapping or murder of company workers, and the expropriation of company assets without compensation. Contracts made by one political regime may be invalidated by a succeeding political regime. Or the same governing group may simply change its mind and not honor a contract.

The easy oil and other minerals have been found. Most of the surface of the Earth has been mapped geologically. Mineral resources that are readily apparent have been developed for the most part. The early prospectors quickly found the rich mineral deposits exposed at the surface. In many cases, these were small operations, but the quality of ore was such that relatively little work could yield great wealth. And so the easily found, rich mineral deposits were soon exploited. In

In the case of petroleum, oil and gas seeps originally indicated the presence of easily discovered and inexpensively drilled shallow oil and gas fields. Now the oil industry must find anticlinal oil traps at great depth, or find much more subtle oil traps such as a lens of sand of a delta finger at a depth of 10,000 to 15,000 feet, or locate a buried ancient coral reef with no surface expression.

The same circumstances apply to metals and other hard minerals. Native copper (that is, pure) discovered in the Upper Peninsula of Michigan was the beginning of the great copper industry of the United States. Anyone could see this copper in large quantities in the “Great Conglomerate.” In prehistoric times, native Americans dug more than 10,000 pits to produce this copper, which became a major trade item up and down the entire Mississippi River Valley. It took no skill to find the copper, and, because it was pure copper, it was easy to use.

United States copper is now produced from a tough, fine-grained igneous rock (quartz monzonite) containing only specks of a copper mineral, not pure copper. The quality (tenor) of the ore is as low as four-tenths of one percent. This means that a ton of rock has to be blasted out, crushed, milled (upgraded by various processes), smelted, and eventually put through an electrolytic process to obtain just eight pounds of copper. It takes a huge and expensive facility to do this.

If the mineral deposit occurs in veins and is and too deep to mine by the open pit method, shafts must be sunk. Underground operations must be pumped free of water that continually floods in, huge fans must be installed to ventilate the mine, and the mine must be electrified. A variety of mine safety devices must be installed. Trying to follow veins of ore through the various complex rock structures that control the ore is difficult and expensive.

Because of all these factors, estimates are that it takes the work of seven men underground to produce the same amount of ore as one man working a surface mine. Today there are mines two miles deep in operation. At such depths, the natural heat gradient of the Earth necessitates that the mine be air-conditioned. Also, because of the great pressure of the overlying rocks, violent rock bursts may occur. Rocks simply burst out of the sides of the mine. They are unpredictable, smashing ore cars and killing miners.

So mining is hazardous and insurance and other costs are high. In the case of underground mines, fluctuating metal prices are a special economic hazard. Unlike surface mining operations, which simply can be shut down if the price of a metal temporarily drops below its production cost, an underground mine must be constantly maintained. The main problem is groundwater, which must be continually pumped out. The mine also has to be kept reasonably dry to prevent the hoisting and other equipment from being damaged, and to provide proper working conditions for the miners.

With the obvious, easily reached deposits of minerals already discovered and developed, the search for minerals today involves looking beneath the ocean floor to find an oil or gas trap many thousands of feet below. Or it could be exploring for deposits beneath the muskeg swamps of Canada or under thick jungle cover in Brazil or New Guinea. If a mineral exploration company is formed, there is no assurance whatever that anything of value will be ever found. Too many consecutive dry holes have put many a fledgling oil company out of business.

A friend told of drilling in the Denver-Julesburg Basin of eastern Colorado. It is a deltaic complex where winding channel sands are the productive structures. The first well drilled was moderately successful. So he drilled an offset well — which was dry, then another offset, also dry, and then two more offset wells, all dry. The amount of oil produced from the first well did not pay the cost of drilling the offset wells. He said if he had drilled one of the dry holes first and given up, he would have been better off financially. Fortunately, he had other resources and survived, but many others in similar situations do not. Drilling is now going deeper and is more expensive. Metal deposits are also far more difficult to find and develop. The time of the small wildcat driller and the lone prospector is largely gone. It takes major company resources to survive repeated failed exploration experiences, some of which cost many millions of dollars. A Scottish firm, Cairn Energy, recently spent $600 million on exploratory drilling in the Arctic and found no oil.

Myth: One mineral/metal can freely and equally replace another

Reality: As we enter the age of depleting resources, both in quality and quantity, there is a view that one metal can freely and equally replace another. This is a carryover of ancient attempts at alchemy, the classic effort to change lead into gold. But the myth persists. The late economist, Julian Simon, carried it to the extreme when he said, “Copper can be made from other metals.” In long-distance electrical transmission lines, aluminum is now being used instead of copper because aluminum is cheaper and lighter weight. In making this substitution, some efficiency is lost because aluminum does not transmit electricity as efficiently as copper does. Each metal has its own distinct physical and chemical properties. Molybdenum makes steel tough so it can be rolled out in sheets and not crack. But within the alloy, molybdenum does not replace steel, it simply adds a quality to it. Similarly with nonmetals, every living cell has to have potassium and phosphorus for which there are no substitutes. (Indeed, when one substance does substitute for another in the body, it is typically a poison or a toxin!) There is no genuine substitute for oil in its many uses. As we face the depletion of the Earth’s resources, there may be limited substitutes for some minerals, but each resource has qualities not found in any other.

Length of time to begin to get return on investment

Another factor common to all mineral ventures is that it takes a good deal of time to realize any income even from a successful project. Time is almost always measured in years. In the case of the Prudhoe Bay Oil Field, it was twenty years from the time when the first exploration money was spent just to the time of drilling the discovery well in 1967. On June 20, 1977, The Anchorage Times carried the headline, “First Oil Flows (After 8 years, 4 months, 10 days).” Actually, after the discovery, it was nearly 10 years before oil was sent down the pipeline and income could begin to be generated from the wells.

The huge Hibernia oil field project off the east coast of Canada took almost two decades to develop. One problem was to build a big enough and strong enough drilling platform to resist the icebergs that frequently float down iceberg alley where the offshore Hibernia field is located. By the time the platform was in place and production began, the various project participants had invested a total of more than six billion dollars (U.S.), which had not earned a penny in interest for a period of about 20 years.

Individuals do not have such large sums of money to invest, nor can they wait many years for a return on their investment. It requires large corporations to take on such longterm risk ventures, carry them to completion, and put gasoline in the world’s automobiles.

For mining operations, the average time from discovery of the prospect to production is about seven years. Previously there were costs of exploration. It may have taken many years just to find the prospect. Then add seven years cost of drilling; building the mills to crush the ore; building other facilities, including roads and housing for the workers; supply lines to support continuing operations; and arrange for transportation of the product. There are increasing financial and time costs for environmental studies, compliance, regulations, and mitigations. These are important and necessary, and their absence in earlier times is still reflected in major scars on the landscape and in streams still polluted from long-abandoned operations. But, complying with regulations is a cost that must be paid to obtain the mineral product.

Time is a factor in mineral economics, because until production starts, all the money invested earns nothing. Money has a time value. For example, if all costs from the beginning of exploration to bringing the mine to production means that $100 million has to be invested for a total of ten years, that $100 million must either be borrowed for ten years at the going rate of interest, provided by earnings from other projects, or supplied by stockholders who buy the stock in hopes of eventually getting a reasonable return for their risk investment. And they may lose it all if the project fails.

The time lag from discovery to full development and the beginning of getting a return on capital investment in a mineral deposit (including petroleum) differs widely depending on a variety of factors, such as accessibility to the resource and the infrastructure needed for profitable production (such as pipelines onshore or undersea and plants for milling and smelting metal ores).

Bringing an oil field into full development may take as long as 40 years. Metal deposits usually take less time, but in all cases, the return on invested capital is substantially slower than in other industrial enterprises. One of the problems is predicting the price of the product over the life of the project. Price changes beyond those anticipated may make the venture uneconomic or in some cases, very profitable.

Investors who buy the stock, or the company itself, could have invested their money in some income-producing instrument such as a bank deposit or a bond and earned an immediate income. Instead, their money was spent trying to develop a mineral prospect that not only has to earn a current return, but also make up for the years when the money earned nothing.

Cameron (1986) puts the situation in perspective: Part of the current American attitude toward mining is a carryover from the 19th century, when there were spectacular successes in some districts of the West. Mining became identified as a quick source of easy profits. Those days are long since gone, although there was a brief revival during the uranium boom in the late 1940s and 1950s. Mining today is a highly competitive industry, in which profit margins are low. It is capital-intensive, yet the profit margins and the long lead times between discovery and first production make it difficult to attract capital funds in competition with other industries in which returns on investment are higher and can be realized in much shorter periods of time.

Mineral resources are nonrenewable

The mineral industry differs from other basic wealth-producing activities such as farming, fishing, hunting, and forestry in that minerals are non-renewable. The average metal mine life is seven to ten years. Oil may first flow from a well from its own pressure. Then it has to be pumped. During production, the field usually has to be repressured by water-flooding or gas injection. Finally, all oil fields are abandoned. Each pound of copper produced and each barrel of oil produced puts the company involved a bit closer to being out of business, unless some of the money earned from current production is set aside to pay exploration costs to find more resources. A new crop of corn may be grown each year to replace the crop produced the year before, but fossil fuels and minerals are one-crop situations.

Taxes

The seventh but very important factor in mineral development, and one completely under the control of people, is taxes. Since money has time value, it is to the advantage of any company to write off expenses in the year in which they occur. Oil and mining companies are no different. But some tax jurisdictions do not allow this, instead requiring that it be done over a period of several years. Another aspect of taxes is that companies are commonly taxed on plants and equipment, and also on proved reserves. This means that the tax bill increases if exploration to prove up reserves gets very far ahead of production needs. Taxing reserves discourages exploration.

At one time, Britain levied taxes as high as 90 percent on the income oil companies received from British North Sea oil production. This left very little for companies to reinvest in further exploration in this high-cost area, and firms began to reduce operations. Recognizing this, the British government since reduced its taxes on North Sea but still taxes them very heavily. There are some smaller fields in the North Sea that could be found and developed if taxes were lower. At present, only large fields with relatively few wells are economic to develop. As these fields are depleted, Britain will have to make a decision to reduce taxes or import even more oil. To date, North Sea oil fields have been milked very heavily by British taxes. Metal mining also tends to be a cash cow for both federal and local governments, with total taxes commonly taking 50 percent or more of gross income. Local governments frequently expand their political boundaries to include mining and oil properties into their tax base.

In less politically stable countries, taxes can and infrequently are changed on a moment’s notice by the action of the person in charge. In 2005, President Hugo Chavez of Venezuela raised royalty payments (taxes) by 16 times on the crude oil from the heavy oil Orinoco region. The same year the Russians charged back taxes on a joint oil operation between British Petroleum (BP) and a Russian company, TNK. The assessment was $936 million.

Price estimations and hazards Increasingly, companies in industrialized countries have to search abroad for natural resources. Political volatility in many countries makes the work of the producers of our basic mineral and energy needs rather difficult. Some understanding of the long-range planning that goes into resource development, and the need for a stable economic environment in which to do this is frequently absent among both the public and the politicians in the countries in which the companies operate.

Mining and public lands in the United States

There has been considerable controversy over the 1872 Mining Law, which allows public lands to be claimed and become private property for the production of minerals. In earlier times, obtaining public lands this way was easy and no doubt abused. Recently, however, requirements for claiming lands have become much stricter, and it has become much more difficult to patent public lands. In 1989, for example, only 43 claims were granted and most of them went to Native American tribes through land settlements in Alaska. At present, it is necessary to prove without reasonable doubt that a mineral deposit of value exists before the land can be claimed. To do this an expenditure of between a half a million and a million dollars must ordinarily be spent on each claim. A claim is 600 feet by 1500 feet. A placer claim, one on sand and gravel deposits, is 660 by 1320 feet. Subsequent to obtaining a deed, many millions must be spent in developing the property. Also, no other industry in the U.S. is covered by more stringent federal, state, and local permitting, safety, reclamation, and environmental laws.

By way of example, a recently proposed underground uranium mine on the Cibola National Forest in western New Mexico needed the following studies, reviews, permits, and approvals: 1) several million dollars spent on baseline environmental studies, including surface water, groundwater, cultural resources, vegetation, wildlife, soils, geology, and air quality; 2) a million dollar Environmental Impact Statement; 3) approval of its Plan of Operations by the U.S. Forest Service; 4) consultation with five American Indian tribes and other “consulting parties” under provisions of the National Historic Preservation Act; 5) ethnographic studies prepared by the tribes but funded by the mining company; 6) application for a Discharge Permit by the New Mexico Environment Department; 7) application for a Mine Dewatering Permit from the New Mexico Office of the State Engineer; 9) application for a New Mine Permit from the New Mexico Mining and Minerals Division; and 10) application for a National Pollutant Discharge Elimination System (NPDES) permit from the U.S. Environmental Protection Agency.

In the past 20 years, the American mining industry has spent more than $15 billion to comply with environmental procedures and regulations. From these operations come the materials for making the things used by everyone: cars, trucks, roads, houses, factories, office buildings, home appliances, and myriad other products in everyday use. The bottom line is that mining is an important part of the U.S. economy, but even when public lands are claimed and owned by mining companies, the industry remains one of relatively low profitability. If public lands require payment of a royalty to the government on minerals produced, that cost ultimately will be borne by the consumer, the general public.

The oil industry and land Initially, in the United States, most oil drilling took place on private lands where the mineral rights were held by the land owner. This is in contrast to the rest of the world where these rights are usually owned by the respective governments. Now in the United States, oil development increasingly is going offshore where mineral rights are owned either by the federal or state governments.

A lot of the strident opposition to resource developments fails to consider that if these were shut down and did not exist, the human race would still be close to living in caves, and heating only with wood.

Human Health and Minerals

There is evidence from the geographic distribution of thyroid disease, hypertension, arteriosclerosis, cancer, tooth decay, and from several diseases of animals that a definite relationship exists between the geochemistry of the Earth in those places, and these medical conditions. Trace elements in human diets are very important. Trace elements are related to regulating the dynamic processes of enzymes, and minute amounts are needed to modify the kinetics of enzyme reactions.

However, excessive amounts of certain minerals can have a negative effect on health. The vegetables grown in New York and Maryland soils are relatively high in iron, manganese, titanium, arsenic, copper, lead, and zinc compared with most other soils. Helen Cannon of the U.S. Geological Survey concluded that the available information suggests a correlation of this fact with the occurrence of certain diseases. Another study in an area known for abnormal concentrations of selenium suggested that high mineralization was a possible factor in an unusual cancer-mortality pattern in that area and has prompted further investigation (Spallholtz, et al., 1981).

Iodine deficiency is one of the most widespread mineral medical problems in the world. Lack of a very minute amount of iodine in the diet can stunt both physical growth and mental ability. Iodine is essential to life. It enables the thyroid gland to produce the hormones necessary to develop and maintain the brain and nervous system. When the levels of thyroid hormones fall, the heart, liver, kidneys, muscles, and endocrine system are all affected adversely. Lack of iodine in the diet of pregnant women can adversely affect their baby. Seafood and food grown in iodine-sufficient soils provide adequate iodine in human diets. It is estimated that about 1.5 billion people in at least 110 countries are threatened by iodine deficiency. The chief regions where deficiency occurs are in mountainous regions and areas prone to frequent flooding, which washes out iodine in the soil.

Selenium is an element that seems to cause and cure a variety of human ailments. A study of 45,000 Chinese reviewed the occurrence of Keshan disease (Faelton, 1981). This is a form of heart disease, mostly affecting children up to the age of eight or nine years. Its symptoms are enlargement of the heart, low blood pressure, and a fast pulse. A high-death rate was clearly related geographically to the amount of selenium in the soil. The disease occurs in a wide band of land running from the northeast coast of China towards the southwestern border of the country. In this area, the soil and crops grown in it are deficient in selenium. Within this region, children given selenium showed a lower incidence of the disease, but it did not diminish in other affected areas where the children were not treated. It was found that, “ … the dramatic responses to Se [selenium] supplementation by individuals suffering from Keshan disease suggest that selenium may yet help mankind overcome two of its most damaging disease conditions” (Spallholz, et al., 1981). The other disease referred to is a form of cancer for which selenium appears to be a useful trace element in treatment.

In the United States, an area along the coastal plain of Georgia and the Carolinas has come to be termed the “stroke belt.” It also has a higher than normal incidence of heart disease. As in China, the area is low in selenium. Although studies are not yet complete, it appears that death rates from a variety of cancers are lower in areas of the United States where local crops take in larger amounts of selenium from the soil. A report from Finland concluded that men with low levels of selenium in the blood were more likely to develop cancers of the lung, stomach, and pancreas. Women also had a marginally higher risk of these ailments, and the report noted that the Finns do not get much selenium in their natural diets.

Too high a concentration of some elements, however, can become a negative health factor. We have just noted that selenium in minute quantities is important to health, but selenium poisoning can occur from an overdose of this element. In late 1988, a general selenium poisoning warning was published by the Sacramento Bee (California) reporting investigations that discovered selenium contamination in the marshes, lakes, and streams, in particular, on the Kesterson National Wildlife Refuge in California’s Central Valley. Large numbers of waterfowl died from selenium poisoning. Fish and game in Wyoming, Colorado, Utah, Montana, and Nevada, as well as California, contained excessive amounts of selenium. Eighty-one percent of the trout, carp, perch, catfish, and goose eggs collected throughout the West exceeded the 200-microgram safety limit and 67 percent were over the 500 level of toxic effect. The samples averaged 974 micrograms, or nearly double the level at which poisoning symptoms begin to appear in healthy human adults.

Products for human consumption were studied and half the foods tested such as steak, liver, poultry, eggs, and vegetables from areas in Oregon, Montana, South Dakota, Nebraska, Wyoming, and Colorado were found to exceed the safe level of 200 micrograms of selenium. The true magnitude of this situation in the western United States has yet to be established, but clues already indicate the problem could be large. However, in spite of all the studies that have been conducted, the precise role of selenium in human health, particularly with relation to heart disease, has still not been conclusively determined. Research continues.

The importance of mineral-rich glacial soils to human longevity was reported by a panel headed by Dr. Howard Hopps, Professor of Pathology at the University of Missouri. The study compared death rates of men ages 35 to 74 in two 100,000 square mile areas. One was in the glaciated Upper Midwest mineral-rich soil and groundwater area, and the other was in the southeastern coastal area of parts of Virginia, the Carolinas, Georgia, and central Alabama. This latter area has a meager supply of minerals in its drinking water and soil. The report found that for every 100 men in this age range who died in a given year in the Upper Midwest region, 200 died in the coastal area. The panel reported that cardiovascular diseases, primarily heart attacks and strokes, accounted for most of the differences in deaths between the two areas. Hopps noted that the Upper Midwest was left rich in minerals and trace elements by the glaciers that “ground up the rocks and made minerals in them available.” These minerals include iron, copper, manganese, fluoride, chromium, selenium, molybdenum, magnesium, zinc, iodine, cobalt, silicon, and vanadium. In the southeast, Hopps found that, “the minerals have been leached out of the soil for millennia.” He also observed that the differences were consistent, stating, “no county in the Minnesota part of the region, for example, was above average in deaths. It seemed to be an inescapable conclusion that a lot of people in the Upper Midwest must be living a lot longer.” The study focused on white men to rule out the possibility of regional racial makeups affecting the results. The study concluded that trace minerals in the soil and water contribute to relative longevity for persons living in this area of glacially transported materials, compared with other areas without these new rocks from which to weather out vital elements into the soil.

CLAY

Clay, by Suzanne Staubach (2005), writes: The story of our relationship with clay is the story of material culture. It is the story of domesticity and the story of technological advances. The inventions of the wheel and the kiln, the understanding that fire could turn mud to stone, were the foundation for thousands of technologies that have followed.

One of the most important uses of clay has been in the manufacture of pipe, especially sewer pipe. Staubach describes how the Doulton Company that made toilets, also discovered that the nonporous pipe could be useful as sewer pipe that would greatly improve the sanitation of cities. The city fathers of London took to the idea of Doulton’s sewer pipe. It was correctly seen as of great importance and came into wide use.

As useful as it is, clay does have some negatives. Still widely used even as unfired sun-dried adobe brick, it is a weak building material. Earthquakes causing the collapse of adobe buildings have brought about many injuries and deaths over the years. On one occasion, more than 200,000 died in a single earthquake in China. On the fringes of the Sahara Desert and other normally dry regions, rare torrential rains do occur. Occasionally these have turned clay-built villages literally into piles of mud. After such an occurrence, some villages have simply been abandoned.

Clay will remain an abundant Earth material and will be used long after present civilizations are history. Clay is the stuff from which civilization has been physically built in many ways.

SALT

probably the first mineral to cause people to travel substantial distances was common salt.

Trails made by animals to salt licks in the eastern United States were some of the first trails the early settlers used.

History records the caravans and traders who moved salt in ancient times over great distances. Some of these salt routes are still used in Africa. In the sixth century, salt was the chief item of trade for Venice, which developed a salt monopoly that extended over parts of the Mediterranean. Venetian salt traders traveled widely in their commerce.

Salt has been used as a final act of warfare. After the long series of the Punic wars with Carthage from 264 B. C. to 146 B. C., Rome finally prevailed. It utterly destroyed Carthage, plowed the site of the city and its fields, and sowed salt on the fields to destroy their fertility.

Gravel. One example of a basic resource we use that comes from nearby localities is gravel. Gravel pits are commonplace and generally not highly regarded. Yet we are greatly dependent on them. In our homes, and all the buildings of towns and cities, and in all the highways and byways all across the country, there is a very important group of materials called aggregates — sand and gravel. They are used in very large quantities and they are heavy. Hauling them long distances is expensive because of the energy cost, so nearby sources are used. The development of gravel pits is a frequent subject of contention, but they are necessary. Gravel pits can sometimes become an asset to the community when they are no longer needed or the supply of aggregates is exhausted, as they then are often graded and landscaped into parks, or made into ponds for local recreation.

Mining and the environment

Again, to provide all these everyday materials, the Earth has to be disturbed somewhere. If wells are not drilled or mines are not dug in your backyard, they will have to be done in someone else’s backyard. This may occur where the local population urgently needs the money for jobs or for public revenues. On a global scale, smaller nations without diversified economies will export anything of value and ignore environmental problems to obtain badly needed foreign exchange to acquire essential food, medicine, and basic goods.

If the environmental movement is to be honest about these matters, it should recognize that by locking up domestic resources, the problem does not disappear. It does “go away” — to some other place where the hole has to be dug to produce the resource. One might suggest that if the environmental movement is to be absolutely “pure” in the sense of not disturbing the Earth at all, houses, hospitals, automobiles, and factories should not be allowed, and we should all go back to living in caves. Unfortunately, like other Earth resources, the supply of caves is also limited. As the world becomes more populated, and as the populations of what are regarded as undeveloped nations are becoming environmentally conscious, the issue of the environmental impact of mineral resource development is becoming a worldwide concern.

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