Dr. BOYD. Not at the moment; no.

Mr. REGAN. Is there any domestic ore that you bring in from New Mexico into the El Paso plant?

Dr. BOYD. It is quite possible some deposits within reach of El Paso might supply the El Paso mill as well as the Mexican ores. Mr. REGAN. Any further questions?

LARGE MANGANESE OPERATIONS PROPOSED AT BATESVILLE, ARK.

Mr. SAYLOR. I want to ask him now with regard to Batesville. I think you said you had a report there in regard to Batesville. Going over this report of Dr. Boyd last evening, I notice that, of the four areas you discussed, it is Batesville that is the only high-grade ore area discussed; is that right?

Dr. BOYD. I don't believe so. I think Batesville is extremely lowgrade. Isn't that correct?

Mr. SAYLOR. It says here 40 to 46 percent; other places running 70 percent manganese.

Dr. BOYD. I think that is the product that will come from them. It is my understanding of Batesville that that is a very large and extremely low-grade deposit. The proposal we may have at Batesville is for a very large plant, handling a great deal of tonnage a day, up to 4,000 tons of rock a day, and that means a large investment, and the company has agreed now to do some more exploration work under the exploration program, so they can outline enough to warrant building the mill in there.

Mr. ASPINALL. Mr. Chairman, if the gentleman will yield.
Mr. REGAN. Mr. Aspinall.

5

Mr. ASPINALL. I wish to refer again to this memorandum that has been placed on our desk again relative to manganese. It has to do with another question concerning research.

CUYUNA RANGE (MINN.) MANGANESE DEPOSITS

In your statement, Doctor, you state that vast quantities of lowgrade manganese-bearing material are known to exist in the bodies of the Cuyuna Range, a magnitude of several hundred million tons. All of this is close enough to the surface so that it can be operated by large-scale open-pit methods in the same way as the iron ores. As I understand it, the Bureau of Mines is conducting extensive exploratory work and has heretofore started drilling campaigns in that area, which drilling program has now been completed; is that correct? Dr. BOYD. That is right.

Mr. ASPINALL. Are you still working on that drilling program? Dr. BOYD. Yes, sir. We are still working on it. That project, because of its low-grade nature, is, however, somewhat down the line. There is quite a lot of work to be done in metallurgy before we go ahead.

Mr. ASPINALL. I understand you propose, if industry will contribute 25 percent, that the Government will step in then and contribute 75 percent for that exploration work, even in manganese? Dr. BOYD. That is right.

The document referred to appears on p. 693 as exhibit 116.

EXPLORATORY OPERATIONS TO BE LEFT TO PRIVATE INDUSTRY

Mr. ASPINALL. With this present program that has been enunciated, will your division or bureau continue with its exploratory work?

Dr. BOYD. No. We feel we should now recess that exploratory work, Government work, as much as possible in order to let private enterprise do that under the new program. We will need those engineers working on those individual projects to help the project go into operation.

Mr. ASPINALL. If private enterprise doesn't go in to take care of this in the immediate future, will you have authorization and appropriations sufficient to resume immediately when you find out that your present program or your suggested program of the work being done by private industry isn't working out?

Dr. BOYD. In the first place, if we are authorized to do it; and, the second part, the funds are a different question. The appropriations requested us to recess that work and required us to absorb our additional defense work from those funds.

Mr. ASPINALL. You don't intend to make another request until you find out whether or not private industry is doing the job?

Dr. BOYD. That is right.

Mr. D'EWART. Will the Artillery Peak people participate in your present program?

Dr. BOYD. No, sir. They will not. We must get that metallurgical work done before we go ahead with it. We hope to get far enough along by the end of the next fiscal year that we then can begin to negotiate a contract with someone to do the job. We will put in funds or requests to cover that project in case it should come through in the fiscal year.

BUTTE-PHILIPSBURG (MONTANA) MANGANESE DISTRICTS

Mr. D'EWART. Has the situation regarding the contracts for the Butte-Philipsburg area changed overnight?

Dr. BOYD. No, sir. Mr. Cole came in just 2 days ago and requested 13 changes in the contract, and we had to take it back.

Mr. D'EWART. That is what you told us yesterday: that Mr. Cole's contract was still in your office because of his request changes.

Dr. BOYD. That is right. That is the primary contract.

Mr. D'EWART. Three other contracts are still in Mr. Morgan's office. Dr. BOYD. We haven't sent them over yet, sir. We are sending them over in one package.

Mr. D'EWART. I thought you told us yesterday they had gone over to Mr. Morgan's office.

Dr. BOYD. I am sorry. I didn't mean to say that.

Mr. D'EWART. All three are in your office?

Dr. BOYD. Yes. There are five altogether.

Mr. D'EWART. Yesterday it was four. They are all in your office? Dr. BOYD. Yes.

Mr. D'EWART. All the manganese contracts for the PhilipsburgButte area are still in your office?

Dr. BOYD. That is right.

Mr. D'EWART. However, they are cleared by your office, as I understand, with the exception of the Cole contract, in which case he has asked for several changes in the contract?

Dr. BOYD. That is right.

Mr. D'EWART. Those have not been worked out?

Dr. BOYD. I think they have been worked out. We are writing the contract now. Those contracts are quite long, and they take a lot of typing.

EXPLORATION PROGRAM EXPENDITURES UNDER CURRENT FISCAL

APPROPRIATION

Mr. REGAN. Mr. Budge had a question, I believe.

Mr. BUDGE. Dr. Boyd, frequently during these hearings it has been at least intimated by the witnesses that this program hasn't gone forward very well due to lack of funds.

Congress seems to bear the brunt of a lot of these things. I want to ask you if you think this would be a fair statement: You are allocated 10 million dollars, as I understand it-

Dr. BOYD. For exploration.

Mr. BUDGE. For the exploration program. Now, $5,000,000 of that, I understand it, has gone back.

Dr. BOYD. Only $5,000,000 is authorized by the Bureau of the Budget.

Mr. BUDGE. In other words, $5,000,000 has gone back.

Dr. BOYD. Yes, sir.

Mr. BUDGE. Now, you have signed one contract for the expenditure of some $7,000?

Dr. BOYD. That is correct.

Mr. BUDGE. Do you feel it is a fair statement for me to say that the remainder of that $10,000,000 is lost to the exploration program for this fiscal year because of the delay that has been met in setting this program up?

Dr. BOYD. I can't say that, Mr. Budge, because we have got enough of these additional applications in that we feel very hopeful we would get enough of them out to take up most of that money this year.

Mr. BUDGE. Most of the $5,000,000?

Dr. BOYD. That is right. We might even go beyond it. One contract is in, for instance, for a very substantial amount of money that will take quite a piece out of it itself.

Mr. BUDGE. I appreciate that those things are somewhat problematical, but you would certainly admit that the $5,000,000 has been lost on the exploration program. The $5,000,000 which was provided by the Congress has now been lost due to delay in setting up this program? That is true, isn't it?

Dr. BOYD. No. We have been told formally that we can go back for that additional $5,000,000 if we find we are going to be able to complete the project this year.

Mr. BUDGE. You have no intention of using it?

Dr. BOYD. We have every intention of trying to, if we can get that job done. What we want to do is get the exploration started.

Mr. BUDGE. You told me a few minutes ago that during this fiscal year you thought, perhaps, you might negotiate contracts up as high as $700,000?

Dr. BOYD. Oh, no. We already sent contracts for signature for $750,000, signature of the operator. We completed the contract, sent it out to them to sign.

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When they sign it, they send it back and I sign it.

Mr. BUDGE. Before June 30, do you plan to use the balance of this 10 million dollars?

Dr. BOYD. We sincerely hope we can; yes.

Mr. BUDGE. May is over.

Dr. BOYD. That is right.

The $700,000 you have already signed?

Mr. ENGLE. Not the 10 million. You mean the 5?

Mr. BUDGE. He says 10.

Dr. BOYD. We are desperately going to try to move it fast enough to get it up to the extent of 10 million dollars.

Mr. BUDGE. By the 30th of June?

Dr. BOYD. I won't promise it, but I am going to try to do it.

FURTHER DISCUSSION OF IDAHO-BERYLLIUM CORP'S. LOAN APPLICATION

Mr. BUDGE. Mr. Chairman, before I finish, I would like to make one statement for the record.

If I am incorrect in this, Doctor, I wish you would correct me: This is the information that has been furnished to me. With regard to this particular mine that we discussed this morning, isn't it true that a Mr. Walter Stoll made a report for the Geological Survey in which he put together all of your reports out of the Bureau of Mines, together with the USGS reports, and on this particular mine the Government has already spent somewhere in the neighborhood of a quarter of a million dollars in investigating it since the termination of World War II, and yet when this application came to your office in January you have since had two additional field reports made of a nonoperating mine; isn't that true?

Dr. BOYD. I don't know, Mr. Budge. I am sorry. I simply don't know all that kind of detail of the operation.

Mr. BUDGE. Are you familiar with Mr. Walter Stoll's report?

Dr. BOYD. No, sir. There are some 700 of these applications and projects before us. I simply cannot personally know the details of it. It is impossible.

Mr. BUDGE. That, to me, is a very interesting thing. I think you should check. If the Government has spent a quarter of a million dollars checking that mine in the last 5 years, and yet you have to send out two parties to check it again, there is certainly something wrong somewhere.

Dr. BOYD. I would strongly suspect the reason those men went back is to work out the details of a contract for the loan with the individual contractor, not to reinvestigate everything we had already done before.

I think you should understand this thing. This business of contracting is not a simple business. One of the presidents of the corporation has told us today or yesterday that we have done with him in 10 days what took him a year to do during the war with the War Production Board during the war to get his work to that point.

Now, the lawyer at the same time told us that the kind of contracts we are dealing with today, in private practice, he would spend a whole year on that contract alone and we are trying to get these things done in a matter of a few days.

NEED FOR AUTOMATIC PREMIUM-PRICE PROGRAM DISCUSSED

Mr. ENGLE. Mr. Budge, will you yield for just one comment. That is a very interesting statement, Dr. Boyd. I recall, when we were talking abut the premium price program and its automatic features, that they would never get out of trouble because each contract would have to be negotiated individually; each with its attendant details and engineering and running hither and yon negotiating the contract; and every Congressman from the far West would be after you, trying to find out why you hadn't executed contracts with mine operators in his district, because those people, in turn, would be complaining to their Congressmen.

Now, you are getting a fair illustration of it. I hope as time goes on that it will become apparent that if you don't put in an automatic system you are going to be sweated out of here by every Congressman from the West, and a lot of them from the East.

Dr. BOYD. I would like to answer that, Mr. Engle, because it is very important we understand that.

We are attempting in the areas where we have a great number of these things to do to develop the blanket program.

The tungsten program is the first. There are others. Mica and lead and zinc will be done that way but when we get into large contracts that involve large sums of money, millions of dollars, we simply do not develop blanket bases.

We have to negotiate those contracts.

Mr. ENGLE. You are admitting the very contentions I was making 2 years ago. I always agreed with you that you might have to negotiate the big ones but you will recall-S. 2105-which had the most. weak-kneed support from the Interior Department.

That gave you no authority to put in blanket programs at all, tungsten type or any other, and this committee contended for a long time that you can't do it except on a blanket basis and get anything

done.

Before this is all over, you fellows will be right back to the premium price program except with the big producers. I will make that prophecy.

Mr. REGAN. Members of the committee, at thistime it is time to cook and eat. The House is not in session this afternoon. We might be able to conclude these hearings, or at least make some further progress if you were to come, say, between 2 and 4 this afternoon. I would like to know what the pleasure of the committee would be.

If these is no objection on the part of any of the members, we will reconvene, and assuming it will be satisfactory. We haven't got to you, Mr. Harding. You are the man with the money. We want to get to you some way before this hearing is over this afternoon.

If it is agreeable, we will reconvene at 2 o'clock, until about 4. Before we do that, I want to say to the committee that we had various prepared statements prepared by the members of the different. departments here and furnished about a month ago.

Some of them are one page, and some longer. All had some information concerning this defense minerals program, and if there is no objection, we will at this time authorize the committee consultant, Mr.