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371. The incentive to search for and work minerals can only be restored by re-uniting the development value in minerals with the ownership. The alternative ways of doing this are that either the development value "could revert to the mineral owner, wholly or in part, or the ownership (the fee simple ") as well as the development value could be acquired by the Nation. In both cases an amendment to certain provisions of the Town and Country Planning Acts, 1947, is involved. vi to awon lemonion memes,
doigty herobienos od blupt. pluuia 372. We have not been able to devise a suitable amending formula whereby mineral owners could retain a sufficiently high percentage of the develop- ment value in minerals to restore incentive which would not at the same time undermine completely the general principle of the Acts. Moreover, it seems to us for technical reasons, to which we have already referred, that if the method of dealing with minerals in the Town and Country Planning Acts in future is to be amended, it should be in the direction of securing powers for some unification of mineral ownership which will facilitate the introduction of a policy to encourage the effective exploration, development, and utilisation of our mineral resources in future.
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FIRED LHG eoiles 373: With regard to further compensation, if any, to be paid to the mineral owners, this should only arise in those cases where the fee simple (“lordship" in Scotland) could be proved to have a residual value, and providing the mineral owner had successfully claimed compensation for loss of development value under the Town and Country Planning Acts, 1947 If residual value can be proved, the amount of compensation is likely to be very small. It could be assessed as a glóbal sum and divided on the same basis as claims admitted under Part VI of the Act in respect of loss of development value of MDC minerals.
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374. Whilst our terms of reference have precluded us from making recom mendations concerning other minerals of more widespread occurrence we are of the opinion that the arguments that have led us to recommend the nationalisation of mineral rights for MDC minerals are equally valid for the other minerals, which, in our view, should be dealt with in the same manner. This matter is referred to again in Chapter XI in connection with our recommendations as a whole.
CONCLUSIONS
99.
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375. In order to secure the unification of rights of those minerals covered by our Report, the development value must be reunited with the ownership. We propose that this should be effected by the transfer of the development value from the Central Land Board and of the "fee simple from existing mineral owners, to a new organisation ("Mineral Development Commission") to be set up by the Minister of Fuel and Power (see Chapter XI).
376. The Commission should deal with all administrative matters con- cerning mineral leases and, so far as possible, all official contacts between mineral operators and the Government should be centralised through it. Existing procedure will then be replaced by an ordinary arrangement as between landlord and tenant; and should the need for compulsory powers to acquire surface rights for mineral working arise, the Commission should state the case to the Ministry of Town and Country Planning.
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377. The preparation of development plans covering areas containing known por suspected Moc minerals of economip importance should con- tinue to be the responsibility of the Minister of Town and Country Planning
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378 The Minister of Town and Country Planning should continue to be responsible for scheduling areas and giving planning permission for the working of MDC minerals. Once the Commission is set up, permission to work, which must include not only land planning but also technical and mining considerations, should be given only by the granting of a lease,
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379. The fact that (a) an area has been scheduled on development plans for mineral working and (b) the Commission is prepared to grant a lease should ensure that development permission is not withheld, but compliance with conditions of working imposed by the Local Planning Authority should remain a responsibility of the mineral lessee.
380. In order to prevent the danger of the dispersion or accidental destruc- tion of mining records which have now lost any actual or intrinsic value to mineral owners, immediate arrangements should be made, in advance of the setting up of the Commission, for their collection, registration, or safe- guarding. This applies more particularly to records other than mine plans (for which there is already statutory provision), for instance to historical records of mining operations and to bore hole journals. In view of the many different kinds of individuals and firms who are likely to hold such records a voluntary appeal' might be the most effective dug andudab
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Borges PRINCIPLES OF FUTURE POLICY STUORAT ien moG. over liv elmsnim, quoite od le amuosse 100 godersdzy 381. The records of mining in this country over many years have convinced us that the promotion of mineral development and of a healthy and prosper- ous mining industry can only be achieved through a positive long-term policy which will remove some of the uncertainties and difficulties at present facing the industry and restore incentive and confidence. This applies particularly to the need to revive exploration for minerals such as fluorspar, barytes, the non-ferrous ores and haematite. Absence of such a policy has undoubtedly been at least partly responsible for the piece-meal, hand-to-mouth type of development characteristic of certain sections of the industry in the past, with the ultimate result that mineral reserves have been lost to the Nation or mines have been closed prematurely and trained labour and technicians dispersed. More recently the effects of the absence of a long-term policy have been intensified as a result of the production needs of the War. This has meant that essential development and plant maintenance or renewal have suffered an emb
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At not ghi at bage bins 382. With regard to the efficient working of our known, mineral deposits, or those which may be subsequently found, the Nation cannot afford to neglect to take all reasonable steps to ensure that the extent and value of the resources is determined so far as practicable, so that future production is safeguarded where necessary and proper provision made in planning schemes for mineral working, Stammboatą of olds on a weston ad iiw n dignut Dror 501
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383. Over large sections of the mineral industry today working is generally as efficient as conditions permit. Nevertheless, the Nation can no longer afford to allergeny w fiting operations to start, or existing Becations to
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continue, if the object is only “to pick out the eyes that is, the best or mospaarely got mineral to make quick profitpa Premature abandonment of mines wastes reserves. The aim must be to obtain adequate knowledge about the mineral occurrence so that the most efficient and most economic method of working can be ascertained in order to make the best use of the occurrence as a whole, particularly where it contains lower-grade portions which would otherwise be left as unprofitable..st
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384. The principles underlying those measures which will be necessary to overcome the difficulties and deficiencies referred to above, and to secure the co-ordinated, orderly and economic development” of our mineral resources in future can best be described under the following four headings:
(1) Exploration and development.
(2) The adequate financing and good management of mining under- takings and efficient exploitation.
(3) Mineral tenure.
(4) Strategic considerations.
Exploration and Development
385. This concerns new mineral discoveries. It thus applies more particu larly (but not entirely) to the lode minerals and other minerals of restricted distribution and limited quantity where the question of the continuation of production after a comparatively short time is entirely dependent on new discoveries being made.
386. The chief problem is to find a way of encouraging the search for and the development of new mineral deposits in face of the knowledge that risks will be greater than in the past because the better known and more accessible resources of economic minerals are either exhausted or are approaching exhaustion. Our accounts of the various minerals will have shown that, while the prospects of making new discoveries are by no means lacking, the field is growing smaller; exploration in future will have to be planned on thoroughly scientific lines, and will usually have to be undertaken on a larger scale, over larger areas, and at greater depths. It will
thus take longer, be more costly, and the risk therefore correspondingly greater:
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387. The crucial factor in considering the financing of exploration is the high degree of mining risk in relation to the potential profit. Generally speaking, and from the nature of the case, we cannot suggest any practicable steps which could be taken which would eliminate this risk from the calcula- tions of mining undertakings. While our recommendations would allow the consideration from time to time of meeting special cases of difficulty by means of subsidies, we believe that this would be a wrong approach in principle. Similarly, it would be inappropriate to grant special taxation concessions to the mining industry (see Chapter VII). Both these measures would tend, in the long run, to encourage a short-term outlook with too much emphasis on production.
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388. We have concluded, however, that there is little or no prospect of starting new exploration of the kind and on the scale needed without the initiative and assistance of the Government in some form, and that to achieve the best results it will be necessary to be able to discriminate so that those projects can be assisted which show the best promise of leading to worth while discoveries. Clearly, the Government interest must be related closely to the merits of individual cases, and in practice dei case for exploration. this must mean an interest in the establishment of a technically sound prima facie
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1389 Wagravel Confe6t2 the conclusion, therefore, hagahel Goferment must take an active part in the discovery, delimitation and assessment of new mineral occurrences when this cannot satisfactorily, or should not, in the national interest, be undertaken by private enterprise. The main object must be to obtain preliminary information which, when made available to private enterprise, would encourage exploration or the expansion of existing opera- tions in those places and on the scale most likely to produce successful results. This work should form the most important part of the general Government responsibility for obtaining) by means of a mineral survey, a comprehensive picture of the mineral occurrences and mineral industries as a whole) (see Chapter X)m of gomans son edert snowsthit out or asd gniniM RHE
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390. The acquisition of the development value in minerals from private owners through the Town and Country Planning Acts, 1947, has removed previous objections to the Government giving direct assistance for mineral development, and if mineral rights are nationalised in the manner we propose, it is entirely logical for the Government to assume responsibility for this kind of work.
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391. No hard and fast lines can be laid down as to the point to which the Government should carry the
quest for information ; obviously each case will vary and must be considered on its merits. Generally, the aim should be to obtain information sufficient to indicate where further exploration or even development could reasonably be started, or existing production continued with some chance of success. In some cases, however, Government responsi- bility for exploration must be carried far enough for a definite decision regard- ing the possibilities of working to be taken. By this means some part at least of the mining risk could be removed, where necessary, when the risk of the initial stage would otherwise prevent exploration or development from starting
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392. The question of the finance of Government-sponsored exploratory schemes, and of the possibility of the recovery of part or all of the cost from the profits of subsequent operations is discussed later (see Chapter XI). One principle should be that revenue obtained as royalties from the nationally-owned minerals should be used to foster future mineral develop- working of
ment. Priority of examination should be given, therefore, strategic reasons apart, to those areas from which profitable results would be most likely to be obtained, word opg
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393. In the case of existing concerns where production or increased pro- duction is limited because of insufficient funds to undertake further develop- ment, it should be possible for the Government to assist in obtaining essen- tial information by providing loans under favourable terms. The justification would be the prospect of proving sufficient reserves to encourage an under- taking to continue or increase the scale of operations. new bar amibas.
394. Mines have had to be closed in the past and workings have become flooded because the operating company had not the necessary finance to carry on, even though the development prospects were reasonably good. In some cases this has been due to factors over which a mining concern has had no control, such as falls in world prices. In others, however, managements have clearly not resisted the temptation to curtail explora- tory development in order to pay dividends, and powers should be provided to prevent this happening in future. The closure of a mine, if that would prevent or hinder access to unproved and potentially mineral-bearing ground, should Potgenl the national interest, be countenanced Fagatureoufi2has been demonstrated beyond reasonable doubt, and if necessary (and under.
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suitable safeguards) at Government expense, that chances of further mineral being discovered are negligible. Such an argument has been used (para. 246) to justify the maintenance of mining operations in the Camborne district of Cornwall, where it is believed that substantial resources of tin ore still exist and which can be conveniently explored and their value determined at a relatively cheap cost only from the existing workings of the one remaining operating mine in the area.
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395. Mining has to face inherent risks, not common to many ordinary commercial undertakings, because of uncertainty about the quantity of mineral available and its grade, or about unknown difficulties of working, which may be encountered.
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396. Once extraction starts, moreover, a mining company must be pre- pared for wide and sometimes violent fluctuations of the commodity market (particularly metals-see figures, pages 87-88), and unless adequate financial reserves are available it will find itself forced to concentrate on the richer or more easily mined sections of the ore-body, and to curtail expenditure on development and exploration. If the mine is heavily watered, pumping is a substantial overhead cost. The inevitable result of such a procedure, if unduly prolonged, is the closure of the mine and the abandonment of resources which, with better financing, might have been made available. More important, perhaps, is the fact that such failures destroy the incentive to start new projects and tend to discredit mining in the area in which they occur.
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397. When considered in conjunction with mining risk the economic fac tors which give rise to uncertainty in ordinary business have an added signi- ficance in mining. The chief of these is instability of selling prices, which has always been much more marked in the primary products of industry than in those nearest to consumers' markets. In mining, non-ferrous metal prices over the last fifty to sixty years provide an outstanding example (see figures, pages 87-88). The highly fluctuating trends of prices and their effect on the development of such minerals as the ores of tin, tungsten, lead and zinc in the U.K. are too well known to need repetition. It is a factor which tends to increase the degree of divergence between the long- term national interest and the more immediate interest of the mining under- taking to secure profits, a divergence much more likely to occur in mining than in other industries. Developments judged to be profitable at a given selling price for the product, and which normally take two or three years to reach production, may be found to be unremunerative because pricês have fallen in the meantime. Existing concerns have to cut development expenditure and work on à hand-to-mouth basis without sufficient informa- tion as to what their mineral resources are likely to amount to or what practical difficulties of working may arise and have to be circumvented. Too often in the past, also, mining companies have not taken the oppor- tunities of developing ahead and modernising plant when times have been prosperous and funds available, so that when economic or technical diffi- culties were met with the lee-way could not be made up and premature closure resulted.
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398. As in the case of encouragement for exploration, there is little that can be done to remove entirely the future uncertainty attaching to mining operations, whether this is due to technical or economic causes, There is no question, however, that in certain cases, particularly new undertakings,
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