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<br />9r'itish Petroleu .
<br />By Bill Epler
<br />Staff Reporter
<br />British Petroleum Company p.l.c.,
<br />following in the footsteps of other large com-
<br />panies with major precious metals produo•
<br />lion, has formed a subsidiary gold company,
<br />and tr preparing to sell a small percentage of
<br />ownership to the public to recover its 1o-
<br />vestment.
<br />Following dawn through the rhain o[ owner
<br />ship, British Petroleum (BP) amounted Sep
<br />tember 30th the formation of SP Gold Com-
<br />pany, to be headquartered in Salt Lake City,
<br />that will aw the gold deposits that have been
<br />owned by AP and its subsidiaries, including
<br />Kemecott.
<br />BP also amomced that BP Gold, newly-
<br />formed by the BP Minerals America Umt, has
<br />Nee a registration statement with the
<br />Seciaities and Exchange Commission far a
<br />proposed initial public offering of 7.5 million
<br />shares of cemmoo stock, with the offering
<br />price to be determined later.
<br />Only a week before, BP America Inc., BP's
<br />Cleveland-based domestic arm, had aa-
<br />namcod the combining o[ the assets o[ Kea-
<br />nerntt Corporation of Salt Iake City and Am-
<br />aelce Minerals Enc. of Denver into a new sub
<br />sidiary, BP Minerals America, that will be
<br />headquartered in Salt Lake City.
<br />(New, if you've got this all straight you're
<br />doing better than we arel )
<br />The proposed stork offering in BP Cold will
<br />consist as approximately 3.75 million shares
<br />for sale in the U.S. and an equal number o[ ed-
<br />ditlanal shares to beoffered internationally.
<br />Upon completion of the proposed offering,
<br />BP will hold approximately 90 percent of the
<br />common stock ad BP Gold and the cash
<br />derived from the stacJc sale.
<br />Tom Koch, manager of media reletiom for
<br />BP Americe, said intent of forming the gold
<br />subsidiary is to create an environment in
<br />`.~.,~~~~ III IIIIIIIIIIIII'll ~gfa
<br />operations ma opera~e mace uca,uy than if
<br />operatlom were induded in m agenda 1o-
<br />duding other minerals.
<br />However, it bas been separately noted by
<br />industry obpervets that some of the big com-
<br />panies ere dpyndsring how mocti longer what
<br />they believe is a bubble in high gold price
<br />will continue. A number have formed
<br />separate suhsidm sold 10 ar 15 per
<br />cent of their stock the public to get beet
<br />their investment and, in some rases, mare
<br />than that. .
<br />As long as high prices and good proBta coo-
<br />time, the parent firm will receive 85 to 90 per
<br />cent of the dividends. And tf the bottom fella
<br />nut, the parrot rnmpany, with its original in-
<br />vestment intact, escapes the [allwt. _
<br />BP Cold will be controlled by a board of
<br />directan, five drawn from BP end two ex-
<br />ternal. A. Dan Rovig, a former Ameelco
<br />executive, will be president and ceo of the
<br />new company and Keith R. Huller will be vice
<br />president operations.
<br />Rovig is vice president gold [or the sew BP
<br />Minerals America.
<br />~~ary
<br />acid.
<br />The
<br />Provide
<br />The byprr
<br />Bingham G
<br />eece+d ar tt
<br />to the mtloo
<br />Industry a
<br />siphoning o[1
<br />tom line of B
<br />ann.
<br />Canyon, BP
<br />_,:..r
<br />i Canyon operaion will
<br />and tolling services to BP
<br />uroductlon. ~, a'
<br />t produMim aJ gold from
<br />i tradltlaoally made Utah the
<br />argent gold produdng state
<br />mnY year.
<br />van are wandering how this
<br />old profits will effect the tot-
<br />em CenYm's coPPw' i~~
<br />.~
<br />1'r~anlt of Re
<br />Thomas R. I
<br />owner d Fran
<br />ar May srd In
<br />A native i
<br />received his h'
<br />airy d wlacom
<br />at the Uoivere
<br />while ca
<br />warted far (
<br />Mining c~P
<br />Ceodafa Sysl
<br />From 1971
<br />manager for
<br />naase Comw
<br />According to the BP amomcemeat, BP
<br />Gold will own all gold operations embraced in
<br />the combination o[ Kemecott and Amaelco.
<br />That indudes the byproduct gold produo-
<br />tlm from the Bingham Canyon copper mine.
<br />In previous yeah, that has ranged from
<br />250,000 to 300,000 orates of gold a year.
<br />It also includes Kemecott's Bamey'e
<br />Canyon prospect five miles north of the
<br />Bingham pit, as well as Kennerntt's Rawhide
<br />and Cortez gold properties in Nevada.
<br />In addition, it will include an 80 percent 1o-
<br />tarsal in a New Guinea gold project with a
<br />potential of SOO,aao ounces amually.
<br />In the meantime, BP Gold's total 1988 gold
<br />production is expected to total Sd0,000 ounces,
<br />South Dakota .. .
<br />said, adding that the mining industrydid aup-
<br />portthe Cive state bills approved in 1988.
<br />Environmentalists Inffitrate
<br />The new regulation were expected to be
<br />drawn up by the South Dakota Department of
<br />Water and Natural Resaacea, but en-
<br />vtraommtalists s~+~-eaty called for a
<br />pa6lic teak farce to be1P with that job.
<br />A task force composed of represmtetlvea
<br />tiara emiraomental grasps, the mining 1o-
<br />dustry and the state department worked for
<br />several mmths recently m the sew
<br />ngu4tiam but were usable to reach a car
<br />iisosus..
<br />the South Dakota Board M Minerals
<br />evlraommt, whlc6 oversee the state
<br />and mtural rrsounws deparlment,
<br />ppe»vs some sort d neav rsgulatiam in
<br />He noted that some of the en-
<br />vvonmentalisfs who perlidpated in the teak
<br />force now are promoting the Lawrence Cam-
<br />tymoratorium propaeal.
<br />In additlao, Zleake added, the so-
<br />vironmental coalitiao has stated that regar
<br />dlese of the new state regulatlata or the nub
<br />come of the Iawreace County vote, the
<br />coalition will take a moratorium ptsposal
<br />before voter oo a statewide level.
<br />"They have not been bargaining in good
<br />faith," the director said. "They won't let the
<br />(state) system (ot drawing up mhrlog
<br />regulatlom) work."
<br />Apparently, the environmental caalitlm
<br />beileves the elate system is sot tough enough
<br />even though m EPA study rates south
<br />Dakota's surface mining eeguLti006 se Ming
<br />equal to those is Celiforoia snd among the
<br />toughest in the ration. Zieeke said.
<br />in PAY DIRT for October 1987
<br />~~~~
<br />In 1977, 1
<br />Associates Cc
<br />Subsidiary ca
<br />plantlan and
<br />varied and ext
<br />copper, coed, i
<br />gdd explorati
<br />and the i
<br />lane.
<br />He his
<br />am, a dal
<br />rtes And Men
<br />ologiat Thomas
<br />o dies et 43
<br />ant, consultlng geotogisi and
<br />and Associates, died of coo-
<br />eao. He was L4. .
<br />South Milwaukce, Funk
<br />6elor's degree at the Univer-
<br />i a~ an MS in geology in 19~
<br />of Arizaoa, where he was a
<br />sting his studies, Funk
<br />bee Cartier and Bear Creel
<br />es. He was later employed by
<br />e as an exploratloo geologist
<br />1877, he was exploratim
<br />anaroya La N1rke1, The Par
<br />and Urania Exploration in
<br />in and Range Province.
<br />ant founded Frank and
<br />silting Geologists in Reno.
<br />paniea Included CMF E_
<br />'d<J 1.3cploration. He had a
<br />slue back®wnd In porpl4yry
<br />udum and, moat recently. in
<br />y including early consultlog
<br />Banrh gold deposit in Nevada
<br />i Gulch gold deposit in Moo-
<br />by his wile, Charlene;
<br />his parents.
<br />Cs~d and '"Canpr4Y Inc., based in
<br />Scottadal0. has acehdred the Pam
<br />Mountain Gol mine i~Hitf~tijM1 Colond0.
<br />Gold and President Charles C. Mob
<br />Uey September24th.
<br />The price was 7.S.milBm eher'es
<br />of Gold and ' it preferred stock.
<br />Pam Mam Gold, an operetlsg raise,
<br />lw assets of ears ~ deeded claims and
<br />teoo,ooo a< equlpmeM, cola and
<br />Mlnaals said.
<br />Ore at the mice stand at 8 mWtm
<br />etiehtc yards, ' tb a ciurrat market value a[
<br />mare then;30 psi CUb1c yard, the company
<br />said. add'wg t operating caste avera6y
<br />about i2 per c Yard (~ 1
<br />
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