Economic Impact Of Proposed Water Pollution Controls On The Nonferrous Metals Manufacturing Industry Phase 2


EPA-230/1-75-041
MARCH 1975
     ECONOMIC IMPACT OF PROPOSED
   WATER POLLUTION CONTROLS ON THE
         NONFERROUS METALS
     MANUFACTURING INDUSTRY
               (Phase II)
                 QUANTITY
      U.S. ENVIRONMENTAL PROTECTION AGENCY
          Office of Planning and Evaluation
             Washington, D.C. 20460
                     \
                     o

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     The document will subsequently be available through the
National Technical Information Service, Springfield, Virginia
22151.

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ECONOMIC IMPACT

PROPOSED WATER POLLUTION CONTROLS

ON THE

NONFERROUS METALS MANUFACTURING INDUSTRY

(PHASE II)
Report to
U.S. ENVIRONMENTAL PROTECTION AGENCY
EPA-230/1-75-041

MARCH, 1975
Environmental Protection

•po
-------
This report has been reviewed by EPA and approved for
publication. Approval does not signify that the con-
tents necessarily reflect the views and policies of the
Environmental Protection Agency, nor does mention of
trade names or commercial products constitute endorse-
ment or recommendation for use.
ii
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PREFACE

The attached document is a contractors' study prepared for the Office
of Planning and Evaluation of the Environmental Protection Agency ("EPA").
The purpose of the study is to analyze the economic impact which could
result from the application of alternative effluent limitation guidelines
and standards of performance to be established under sections 304(b) and
306 of the Federal Water Pollution Control Act, as amended.

The study supplements the technical study ("EPA Development Document")
supporting the issuance of proposed regulations under sections 304(b) and
306. The Development Document surveys existing and potential waste treat-
ment control methods and technology within particular industrial source
categories and supports promulgation of certain effluent limitation guide-
lines and standards of performance based upon an analysis of the feasibility
of these guidelines and standards in accordance with the requirements of
sections 304(b) and 306 of the Act. Presented in the Development Document
are the investment and operating costs associated with various alternative
control and treatment technologies. The attached document supplements this
analysis by estimating the broader economic effects which might result from
i the required application of various control methods and technologies. This
study investigates the effect of alternative approaches in terms of product
\j price increases, effects upon employment and the continued viability of
affected plants, effects upon foreign trade and other competitive effects.
^
^2> The study has been prepared with the supervision and review of the
1 Office of Planning and Evaluation of EPA. This report was submitted in
^ fulfillment of Contract No. 68-01-1541, Task Order No. 14 by Arthur D.
.^ -^ ' j
Little, Inc. Work was completed as of March 8, 1975.
\A
("H This report is being released and circulated at approximately the same
(^ time as publication in the Federal Register of a notice of proposed rule
making under sections 304(b) and 306 of the Act for the subject point source
category. The study has not been reviewed by EPA and is not an official EPA
publication. The study will be considered along with the information con-
tained in the Development Document and any comments received by EPA on either
document before or during proposed rule making proceedings necessary to
establish final regulations. Prior to final promulgation of regulations,
the accompanying study shall have standing in any EPA proceeding or court
proceeding only to the extent that it represents the views of the contractor
who studied the subject industry. It cannot be cited, referenced, or repre-
sented in any respect in any such proceeding as a statement of EPA's views
regarding the subject industry.
iii
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TABLE OF CONTENTS
LIST OF TABLES AND FIGURES

PART I: EXECUTIVE SUMMARY

A. PURPOSE AND SCOPE
B. PRIMARY COPPER SMELTING AND REFINING
C. PRIMARY LEAD SMELTING AND REFINING
D. PRIMARY ZINC SMELTING AND REFINING
E. SECONDARY COPPER SMELTING AND REFINING
F. LIMITATIONS OF ANALYSIS

PART II: PRIMARY COPPER SMELTING AND REFINING

A. INTRODUCTION

B. INDUSTRY DESCRIPTION

1. Apparent Reserves
2. Mining
3. Beneficiation
4. Smelting Practice
5. Refining
6. Historical
7. Recent Trends in Copper Extractive Technology
8. Water Usage in the Copper Industry
9. Supply and Demand
10. The Interdependence of the Copper, Lead and
Zinc Industries
11. By-Products of the Western Mining Industry

C. INDUSTRY SEGMENTS

1. Types of Firms
2. Types of Plants

D. FINANCIAL PROFILES

E. PRICE EFFECTS

1. Determination of Prices
2. Costs of Production
PAGE

1-1

1
1
5
10
17
19

II-l

3
3
5
7
10
11
12
14
18

22
26

31
31

40
43
iv
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PAGE

F. ASSESSMENT OF ECONOMIC IMPACT 11-46

1. Effluent Guidelines 46
2. Industry Segmentation 51
3. Basis for Analysis 51
4. Best Practicable Control Technology 52
5. Best Available Control Technology 56
6. New Source Performance Standards 65

G. LIMITS OF THE ANALYSIS 65

1. Accuracy 65
2. Range of Error 66

PART III: PRIMARY LEAD SMELTING AND REFINING III-l

A. INTRODUCTION 1

B. INDUSTRY DESCRIPTION 1

1. Apparent Reserves 1
2. Mining 2
3. Milling 3
4. Smelting Practice 4
5. Refining 5
6. Recent Trends in Lead Extraction 6
7. Water Usage in the Lead Industry 7
8. Supply and Demand 9
9. The Interdependence of the Copper, Lead and
Zinc Industries 10
10. By-Products of the Western Mining Industry 14

C. INDUSTRY SEGMENTS 18

1. Types of Firms 18
2. Types of Plants 19

D. FINANCIAL PROFILES 23

E. PRICE EFFECTS 23

1. Determination of Prices 23
2. Costs of Production 25

F. ASSESSMENT OF ECONOMIC IMPACT 28

1. Effluent Guidelines 28
2. Industry Segmentation 32
3. Basis for Analysis 32
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PAGE

4. Best Practicable and Best Available
Control Technologies 111-33
5. New Source Performance Standards 40

G. LIMITS OF THE ANALYSIS 40

1. Accuracy 40
2. Range of Error 41

PART IV: PRIMARY ZINC SMELTING AND REFINING IV-1

A. INTRODUCTION 1

B. INDUSTRY DESCRIPTION 1

1. Apparent Reserves 2
2. Mining 3
3. Milling 3
4. Smelting and Refining 4
5. Recent Trends 5
6. Water Usage in the Zinc Industry 6
7. Auxiliary Air Pollution Control Systems 10
8. Supply and Demand 10
9. The Interdependence of the Copper, Lead and
Zinc Industries 11
10. By-Products of the Western Mining Industry 15

C. INDUSTRY SEGMENTS 20

1. Types of Firms 20
2. Types of Plants 20

D. FINANCIAL PROFILES 23

E. PRICE EFFECTS 23

1. Determination of Prices 23
2. Costs of Production 24

F. ASSESSMENT OF ECONOMIC IMPACT 28

1. Effluent Guidelines 28
2. Industry Segmentation 31
3. Basis for Analysis 31
4. Best Practicable Control Technology 32
5. Best Available Control Technology 36
6. New Source Performance Standards 45
VI
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PART V:

LIMITS OF THE ANALYSIS
1. Accuracy
2. Range of Error
SECONDARY COPPER SMELTING AND REFINING
A.
B.

INTRODUCTION
INDUSTRY DESCRIPTION
1. History
2. Definitions
3. Raw Materials
4. Sorting Scrap
5. Scrap Preparation
6. Melting and Alloying Intermediate Copper Scrap
7 . Refining High-Grade Copper Scrap
INDUSTRY SEGMENTS
1. Types of Firms
2. Types of Plants
3. Percent of Industry Represented by Each Segment
FINANCIAL PROFILES
1. Profits
2 . Annual Cash Flow
3. Market Value of Assets
4. Cost Structure
5. Constraints on Financing Additional Capital
PRICE EFFECTS
1. Determination of Prices
2. Ability to Pass on Increased Costs
ASSESSMENT OF ECONOMIC IMPACT
1. Effluent Guidelines
2. Industry Segmentation
3. Basis for Analysis
PAGE
IV-45
45
46
V-l
1
1
2
2
3
6
7
13
19
21
23
24
25
25
28
28
30
30
31
32
32
33
34
34
35
37
vii
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PAGE

4. Best Practicable and Best Available
Control Technologies V-38
5. New Source Performance Standards 41

G. LIMITS OF THE ANALYSIS 41

1. Accuracy 41
2. Range of Error 42
3. Questions Remaining to be Answered 42

PART VI: APPENDIX VI-1
viii
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LIST OF TABLES

TABLE NO. PAGE

1-1 Recommended Effluent Guidelines for Primary
Copper Smelting and Refining 1-4

1-2 Summary of Impact of BPT Costs on Primary Copper
Smelting and Refining 1-6

1-3 Summary of Impact of BAT Costs on Primary Copper
Smelting and Refining 1-7

1-4 Recommended Effluent Guidelines for Primary Lead
Smelting and Refining 1-9

1-5 Summary of Impact of BPT, BAT Costs on Primary
Lead Smelting and Refining 1-11

1-6 Recommended Effluent Guidelines for Primary Zinc
Smelting and Refining 1-14

1-7 Summary of Impact of BPT Costs on Primary Zinc
Smelting and Refining 1-15

1-8 Summary of Impact of BAT, NSPS Costs on Primary
Zinc Smelting and Refining 1-16

1-9 Recommended Effluent Guidelines for Secondary
Copper Smelting and Refining 1-18

1-10 Summary of Impact of BPT, BAT Costs on Secondary
Copper Smelting and Refining 1-20

II-l World Copper Mine Production By Country 11-20

II-2 Net Increase in Free World Primary Copper Productive
Capacity - 1973-1975 11-21

II-3 U. S. Imports of Refined and Blister Copper 11-23

II-4 Cross-Flow of Materials Between Primary Copper, Lead
and Zinc Industries 11-24

II-5 1968 Statistics Regarding By-Products and Co-Products
from U.S. Cu-Pb-Zn Industry 11-28

II-6 Principal Copper-Producing Companies in the United
States, 1970 11-32
ix
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LIST OF TABLES CONT'D.

TABLE NO. PAGE

II-7 United States Mine Production of Recoverable Copper
By Major Producing States: 1968, 1969, 1970 11-33

II-8 Major Copper Mines and Mills 11-34

II-9 Copper Smelting Works of United States—1972 11-36

11-10 Approximate Flow of Concentrates Between Copper
Mines and Smelters 11-37

11-11 United States Copper Refinery Capacity 11-38

11-12 Recommended Effluent Guidelines for Excess Rainwater
Discharge—All Primary Copper Smelters and Those
Refineries Located in Net Evaporation Areas 11-48

11-13 BPT Recommended Effluent Guidelines—Primary Copper
Refining—Net Precipitation Areas 11-49

11-14 BAT and NSPS Recommended Effluent Guidelines—Primary
Copper Refining—Net Precipitation Areas 11-50

11-15 Estimated Investment and Operating Costs for BPT
Effluent Guidelines—Primary Copper Smelting and
Refining Industry 11-53

11-16 Estimated Investment and Operating Costs by Industry
Segment for BPT Effluent Guidelines—Primary Copper
Smelting and Refining Industry—1972 Dollars 11-54

11-17 Related Information on Costs for Meeting the BPT
Effluent Guidelines—Primary Copper Smelting and
Refining Industry 11-55

11-18 Annual Smelting and Refining Capacity of Primary
Copper and Percents of Total Industry Represented
by Each Segment, 1972—BPT Effluent Guidelines 11-57

11-19 Employment and Percent of Total Industry for Each
Segment—Primary Copper Smelting and Refining
Industry, 1972—BPT Effluent Guidelines 11-58

11-20 Estimated Investment and Operating Costs for BAT
Effluent Guidelines—Primary Copper Smelting and
Refining Industry 11-59
x
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LIST OF TABLES CONT'D.

TABLE NO. PAGE

11-21 Estimated Investment and Operating Costs by Industry
Segment for BAT Effluent Guidelines—Primary Copper
Smelting and Refining Industry—1972 Dollars 11-61

11-22 Related information on Costs for Meeting the BAT
Effluent Guidelines—Primary Copper Smelting and
Refining Industry 11-62

11-23 Annual Smelting and Refining Capacity of Primary
Copper and Percent of Total Industry Represented by
Each Segment, 1972—BAT Effluent Guidelines 11-63

11-24 Employment and Percent of Total Industry for Each
Segment—Primary Copper Smelting and Refining
Industry, 1972—BAT Effluent Guidelines 11-64

III-l Cross-Flow of Materials Between Primary Copper,
Lead and Zinc Industries III-ll

III-2 1968 Statistics Regarding By-Products and Co-
Products from U.S. Cu-Pb-Zn Industry IH-16

III-3 Major U.S. Lead Mines 111-20

III-4 Primary Lead Smelters and Refineries—1972 111-21

III-5 Flow of Concentrates Between Lead Mines and Smelters 111-22

III-6 Recommended Effluent Limitations for Excess Rainwater
Discharge—Net Evaporation Areas—Primary Lead
Smelting and Refining Industry II1-30

III-7 Recommended Effluent Limitations for Plants Located
in Net Precipitation Areas—Primary Lead Smelting
and Refining Industry 111-31

III-8 Estimated Investment and Operating Costs for BPT and
BAT Effluent Guidelines—Primary Lead Smelting and
Refining Industry 111-34

III-9 Estimated Investment and Operating Costs by Industry
Segment for BPT and BAT Effluent Guidelines—Primary
Lead Smelting and Refining Industry—1972 Dollars 111-36

111-10 Related Information on Costs for Meeting the BPT and
BAT Effluent Limitations—Primary Lead Smelting and
Refining Industry 111-37

xi
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LIST OF TABLES CONT'D.

TABLE NO.
HI-11 Annual Smelting and Refining Capacity of Primary
Lead and Percent of Total Industry Represented by
Each Segment, 1972 111-38

HI-12 Employment and Percent of Total Industry for Each
Segment — Primary Lead Smelting and Refining
Industry — 1972 111-39

IV-1 Cross-Flow of Materials Between Primary Copper,
Lead and Zinc Industries IV-12

IV-2 1968 Statistics Regarding By-Products and Co-Products
from U.S. Cu-Pb-Zn Industry IV-17

IV-3 Major U.S. Zinc Mines IV- 21

IV-4 Slab Zinc Plant Capacities — 1972 IV-22

IV-5 BPT Recommended Effluent Limitations — Primary Zinc
Smelting and Refining Industry IV-29

IV-6 BAT and NSPS Recommended Effluent Limitations —
Primary Zinc Smelting and Refining Industry IV-30

IV- 7 Estimated Investment and Operating Costs for BPT
Effluent Guidelines — Primary Zinc Smelting and
Refining Industry IV-3 3

IV-8 Estimated Investment and Operating Costs by Industry
Segment for BPT Effluent Guidelines — Primary Zinc
Smelting and Refining Industry — 1972 Dollars IV-34

IV- 9 Related Information on Costs for Meeting the BPT
Effluent Guidelines — Primary Zinc Smelting and
Refining Industry IV-35

IV-10 Annual Smelting and Refining Capacity of Primary
Zinc and Percent of Total Industry Represented by
Each Segment, 1972— BPT Effluent Guidelines IV-37

IV-11 Employment and Percent of Total Industry for Each
Segment — Primary Zinc Smelting and Refining
Industry, 1972— BPT Effluent Guidelines IV-38

IV-12 Estimated Investment and Operating Costs for BAT
Effluent Guidelines — Primary Zinc Smelting and
Refining Industry IV-39

xii
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LIST OF TABLES CONT'D.

TABLE NO. PAGE

IV-13 Estimated Investment and Operating Costs by Industry
Segment for BAT Effluent Guidelines—Primary Zinc
Smelting and Refining Industry—1972 Dollars IV-41

IV-14 Related Information on Costs for Meeting the BAT
Effluent Guidelines—Primary Zinc Smelting and
Refining Industry IV-42

IV-15 Annual Smelting and Refining Capacity of Primary
Zinc and Percent of Total Industry Represented by
Each Segment, 1972--BAT Effluent Guidelines IV-43

IV-16 Employment and Percent of Total Industry for Each
Segment—Primary Zinc Smelting and Refining
Industry, 1972—BAT Effluent Guidelines IV-44

V-l Types of Copper-Bearing Scrap V-4

V-2 Percent of Value of Shipments of Copper and Copper-Base
Alloys Accounted for by the Largest Companies in the
Secondary Copper Smelting and Refining Industry—1963
and 1967 V-22

V-3 Plants, Employees, and Production and Percents of
Industry Totals Represented by Each Segment V-26

V-4 Measures of Financial Performance of Secondary
Copper Smelting and Refining Industry Based on 1967
Bureau of Census Data V-29

V-5 Recommended Effluent Limitations for Excess Rainwater
Discharge—Secondary Copper Smelting and Refining
Industry V-36

V-6 Estimated Investment and Operating Costs for BPT and
BAT Effluent Guidelines—Secondary Copper Smelting
and Refining Industry V-39

V-7 Related Information on Costs for Meeting the BPT and
BAT Effluent Limitations—Secondary Copper Smelting
and Refining Industry V-40
xiii
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LIST OF FIGURES

FIGURE NO. PAGE

II-l Generalized Water-Flow Diagram for Smelter-Type
Operation 11-16

II-2 Generalized Water-Flow Diagram for Electrolytic
Refinery 11-17

II-3 Where the Smelters and Refineries are Located 11-39

II-4 Average Annual U.S. Copper Prices (F.O.B. Refinery) 11-42

II-5 Diagrammatic Representation of Variation in
Concentrate Value with Changes in Wirebar Price 11-45

III-l Generalized Diagram of Water Uses and Wastewater
Sources in Primary Lead Plants III-8

I1I-2 Average Annual U.S. Lead Prices (New York) 111-24

III-3 Diagrammatic Representation of Variation in
Concentrate Value with Changes in Wirebar Price 111-27

IV-1 Generalized Diagram of Wastewater Streams in
Primary Zinc Operations IV-8

IV-2 Average Annual U.S. Zinc Prices (E. St. Louis) IV-25

IV-3 Diagrammatic Representation of Variation in
Concentrate Value with Changes in Wirebar Price IV-27

V-l Flow of Copper Scrap in United States V-5
xiv
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Part 1. Executive Summary
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I. EXECUTIVE SUMMARY

A. PURPOSE AND SCOPE

This study is aimed at supplying the Environmental Protection Agency
with information regarding the economic impact of the costs of pollution
abatement requirements under the Federal Water Pollution Control Amendments
of 1972 for each of the three standards under consideration:

1. Proposed Best Practicable Technology (BPT) - to be met
by industrial dischargers by 1977.

2. Proposed Best Available Technology (BAT) - to be met by
1983.

3. Proposed New Source Performance Standards (NSPS) - to be
applied to all new facilities (that discharge directly to
navigable waters) constructed after the promulgation of
these guidelines (approximately January 1, 1974).

The scope of this study is limited to certain segments of the nonferrous
metals manufacturing industry, namely:

• SIC 3331 - Primary Smelting and Refining of Copper

• SIC 3332 - Primary Smelting and Refining of Lead

• SIC 3333 - Primary Smelting and Refining of Zinc

• SIC 33A1 - Secondary Smelting and Refining of Copper (Partial]

B. PRIMARY COPPER SMELTING AND REFINING

1. Industry Description

The United States has been the largest copper producing country in the
world since before the turn of the century. Most of the copper mined in
the United States is produced in five western states—Arizona, Utah, New
Mexico, Montana and Nevada. There are 27 major mines that account for over
95% of the copper output. A major portion of the mine production is accounted
for by producers such as Kennecott, Phelps Dodge, Anaconda, Newmont and
Inspiration, who are integrated from mining through fabrication. Numerous
small companies participate only in mining and beneficiation sectors of the
copper industry and sell or arrange for toll treatment of their concentrates
at the custom smelters of Asarco. Some of the larger mining companies are
Duval and Cyprus.

Many large domestic producers through subsidiaries or stockholdings oper-
ate foreign properties in both the developed and developing countries and
are also involved domestically in the production of other nonferrous metals
1-1
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such as aluminum, lead and zinc. The financial posture of some of the
companies has been changed by expropriation of certain foreign holdings
and nationalization in other countries continues to be a threat.

Traditionally the smelters have been situated near the mines in order
to minimize transportation costs for concentrates. At the present time,
there are 15 primary smelters in the U.S., thirteen of them west of the
Mississippi. The total capacity in 1973 was about 2 million tons per year.
A new copper smelter is being constructed by Phelps Dodge in Southern Hidalgo
County, New Mexico. There are several other projects also in the construc-
tion stage that involve hydrometallurgical processing.

The major portion of the smelter output of blister copper is eiectro-
refined, while a smaller portion is fire refined. Fabricating companies
are the principal consumers of refined copper. They work the metal into
semi-finished form such as sheet, strip, rod, tube, wire and extruded or
rolled shapes which are the raw materials for the manufacturing industries.

The domestic copper, lead and zinc industries are interdependent to the
extent that by-products or residues from one industry form a part of the
input to the other. In particular, the western copper, lead and zinc indus-
try is a significant producer and processor of by-products. The by-product
supply and production is generally inelastic, i.e., not dependent on demand
or price of the by-product but dependent only on the primary metal production.

An important aspect of the entire primary nonferrous industry is that
traditionally the smelters and refineries have been operated as service
operations at a fixed and relatively low profit margin which is not very
sensitive to the price of the finished product. Hence, the impact of any
change in price of the primary metal has to be reflected back and affects
directly the value of the concentrate. Because of this mechanism, any
increase in smelting or refining costs cannot be "absorbed" by the smelter
or refinery but can only be passed backward to the mine and the net-back
(the net concentrate value realized at the mine; e.g., smelter payment minus
transportation costs) would be decreased. Should the market supply/demand
constraints permit an upward adjustment in primary metal price, the benefit
from this increase is also reflected back to the mine.

Over the past 20 years, world consumption of copper has been increasing
at an average annual rate of 4 to 4-1/2% to its 1972 level of 7.9 million
tons per year of refined metal. Despite competition from plastics and
aluminum, consumption is expected to increase at about the same rate world-
wide over the next decade with a slightly lower rate in the industrialized
countries. The U.S. is a leading producer and consumer of primary copper,
accounting for about one-third of Free World production and consumption.
Despite this, the U.S. has been in a position of undersupply since the
early 1960's. Domestic mine production has been increasing recently at an
adjusted rate of about 3-1/2% per year,.

During the 1960's, the annual average copper (f.o.b. domestic refinery)
price varied from a low of 29.9c/lb in 1961 to a high of 57.7c/lb in 1970.
1-2
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In the 1970's the price has been much higher, reaching 68.18
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TABLE 1-1
i
-t-
RECOMMENDED EFFLUENT GUIDELINES
FOR PRIMARY COPPER SMELTING AND REFINING
Category (i),(ii)
Excess Rainwater
Parameter
Total Suspended Solids
Arsenic
Cadmium
Copper
Iron
Lead
Nickel
Selenium
Zinc
Oil and Grease
PH
Max. for
any one
day
(mg/1)
50
20
0.5
—
0.5
1.0
0.5
10
10
—
Av. of daily
values for 30
consecutive
days shall not
exceed
(mg/1)
25
10
0.25
—
0.25
0.5
0.25
5
5
—
7-10.5
Category (iii)
BPT
Av. of daily
values for 30
Max. for consecutive
any one days shall not
day exceed
i 1, / -i nnn i h
0.1 0.05
0.04 0.02
—
0.001 0.0005
—
—
—
0.02 0.01
0.04 0.02
0.04 0.02
7-10
Category (iii)
BAT, NSPS
Av. of daily
values for 30
Max. for consecutive
any one days shall not
day exceed
„ j .
0.01 0.005
0.004 0.002

0.0001 0.00005

0.002 0.001
0.004 0.002
0.004 0.002
7-10
SOURCE: Effluent Guideline Development Document
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Table 1-2 summarizes the impact of BPT costs on the moderate cost seg-
ment. It can be seen that the increase in operating costs is 0.03c/lb for
this segment. This quantity is well within the cyclical variations experi-
enced by the industry and the variation in operating costs or operating
margin from plant to plant. Thus we expect no discernable impact resulting
from the costs shown for this effluent guideline alone. (cf. Limitations of
Analysis.)

Table 1-3 presents the impact of BAT costs. The impact of total BAT
costs and of incremental costs above BPT is shown separately. The increase
in cost is higher than for the BPT standard but is still within the varia-
tions mentioned in the previous paragraph.

C. PRIMARY LEAD SMELTING AND REFINING

1. Industry Description

The United States was the world's leading lead-mining Nation from 1929
to 1957, until supplanted by Australia. As the world's largest consumer,
it has required additional sources of lead to meet domestic requirements.
Domestic mine output from Missouri, Idaho, Utah and Colorado contributes
only a portion of U.S. requirements, the remaining portions coming nearly
equally from imports and scrap reclamation.

There are four companies (Asarco, Amax, St. Joe, and Bunker Hill) oper-
ating six primary smelters in the U.S. and all except St. Joe are involved
in custom smelting (outright purchase of concentrates). Although these
custom smelters are integrated into mining, they are dependent on outside
sources for over half of their concentrate input. The western lead concen-
trates are much higher in by-product and co-product values than Missouri
lead concentrates and require a slightly different treatment.

Many large domestic producers through subsidiaries or stockholdings
operate foreign properties in both the developed and developing countries
and are also involved domestically in the production of other nonferrous
metals such as aluminum, copper and zinc. The financial posture of some of
the companies has been changed by expropriation of certain foreign holdings
and nationalization in other countries continues to be a threat.

Moderate Cost
Segment
Percent
of
Industry
58
42
SUMMARY OF IMPACT OF
BPT COSTS ON PRIMARY COPPER
SMELTING AND REFINING
Added Investment/
Average Annual
Employment Plant Investment
(*)
18,944
13,830 3
Increase
Added investment/ in
1972 Net capital Operating
In place Cost
(%) (C/lb)
—
1 0.03
SOURCE: ADL Estimates
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TABLE 1-3
Percent
of
Industry
A. Breakdown Based
on Total BAT
Cost:

No Cost
S egment

Moderate
Cost Segment
55
45
SUMMARY OF IMPACT OF

BAT COSTS ON PRIMARY COPPER

SMELTING AND REFINING
Employment
Added Investment/
Average Annual
Plant Investment
Added Investment/
1972 Net Capital
In Place
Increase
in
Operating
Cost
(C/lb)
18,163

14,611
0.0
B. Breakdown Based
on Incremental
Cost above BPT:

No Cost
S egment

Moderate
Cost Segment
94
30,786

1,988
0.06
SOURCE: ADL Estimates
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An important aspect of the entire primary nonferrous industry is that
traditionally the smelters and refineries have been operated as service
operations at a fixed and relatively low profit margin which is not very
sensitive to the price of the finished product. Hence, the impact of any
change in price of the primary metal has to be reflected back and affects
directly the value of the concentrate. Because of this mechanism, any
increase in smelting or refining costs cannot be "absorbed" by the smelter
or refinery but can only be passed backward to the mine and the net-back
(the net concentrate value realized at the mine; e.g., smelter payment
minus transportation costs) would be decreased. Should the market supply/
demand constraints permit an upward adjustment in primary metal price, the
benefits from this increase is also reflected back to the mine.

Over the past 20 years, world consumption of lead has been increasing
at an average annual rate of 2.5-3% to its present level of about 3.5
million tons per year of refined metal. The usage of lead in the world,
especially in the industrialized countries, is heavily dependent on the
automotive industry. The U.S. is a major producer and the largest consumer
of lead, accounting for about one quarter of Free World refined production
and 28% of the consumption.

The U.S. has been in a position of undersupply for years and even the
recent increase in production from the new Missouri lead belt will still
not make U.S. self-sufficient. Because of possible phasing out of alkyl
lead compounds in gasoline, we would expect little growth and perhaps a
decline in domestic lead consumption up to 1976.

Lead prices are sensitive to the imbalance between supply and demand,
producer stock position and foreign prices. A relatively small difference
between supply and demand can have a major impact on price. Also, the
large supply of lead derived from secondary sources and the dependence on
imports has made the U.S. lead price subject to frequent changes. Lead
price since 1960 has varied from a low of 8.25<:/lb (in 1962) to 18.28£/lb
at the end of 1973.

2. Impact Analysis

a. Proposed Effluent Guidelines

The industry has been divided into two categories for the purpose of
developing these guidelines. These categories and the guidelines are:

Category Standard

i) Plants in net evaporation No discharge (BPT, BAT) except
areas. for excess rainfall meeting
criteria in Table 1-4.

ii) Plants in net precipitation See Table 1-4.
areas.
1-8
-------
Parameter

Total Suspended
Solids
Cadmium
Lead
Zinc
PH
TABLE 1-4

RECOMMENDED EFFLUENT GUIDELINES
FOR PRIMARY LEAD SMELTING AND
Category (i)
Excess Rainwater
Av. of daily
values for 30
Max. for consecutive
any one days shall not
day exceed
(mg/1) (mg/1)
50 25
1 0.5
1 0.5
10 5.0
REFINING
Category (ii)
BPT, BAT
Av. of daily
values for 30
Max. for consecutive
any one days shall not
dax exceed
— (lb/1000 Ib product) --
0.042 0.021
0.0008 0.0004
0.0008 0.0004
0.008 0.004
7-10.5
7-10
SOURCE: Effluent Guideline Development Document
1-9
-------
b. Economic Impact
The industry was divided into no cost, moderate cost and higu v.ost seg-
ments depending on the costs imposed by the Effluent Guidelines. The criteria
were:

• No Cost - The plant will have negligible cost imposed
by the proposed effluent guideline.

• Moderate Cost - The plant will incur an incremental operating
cost of less than 0.5£/lb of contained copper
or an additional capital investment of up to
25% of the plant's average annual investment
or up to 10% of the estimated 1972 net capital
in place.

• High Cost - The plant's additional operating cost will be
0.5c/lb of contained copper or greater or the
added capital investment will be 25% or more
of the plant's average annual investment or
10% or more of the estimated 1972 net capital
in place.

To be placed in any one of the above segments, a plant must meet two of the
criteria.

Since BPT and BAT standards are the same for this industry, Table 1-5
shows the combined BPT, BAT costs for both categories. It can be seen that
the increase in operating costs is 0.08£/lb for the moderate cost segment
which is well within cyclical variations experienced by the industry and
the variations in operating costs or operating margin from plant to plant.
Thus we expect no discernable impact resulting from the costs shown for
this Effluent Guideline alone. (cf. Limitations of Analysis.)

D. PRIMARY ZINC SMELTING AND REFINING

1. Industry Description

The United States was the world's largest zinc smelting and consuming
nation and imported over 50% of smelter feed prior to 1960. Recent smelter
closings, the result of a cost-price squeeze, have decreased the domestic
smelting capacity by about 60% to a level approximately equal to the domes-
tic mine production.

Numerous small companies participate only in the mining and beneficiation
sector of the zinc industry and sell their concentrates to custom smelters.
Domestic mine production comes from mainly Tennessee, New York, Colorado,
Missouri and Idaho. Six companies (Asarco, Amax, St. Joe, New Jersey Zinc,
National Zinc and Bunker Hill) operate seven slab zinc plants in the U.S.
and all of them are involved in custom smelting to some extent.
1-10
-------
TABLE 1-5

SUMMARY OF IMPACT

OF BPT. BAT COSTS ON PRIMARY

LEAD SMELTING AND REFINING
Percent
of
Industry
Employment
Added Investment/
Average Annual
Plant Investment
Added Investment/
1972 Net Capital
In Place
(%)
Increase
in
Operating
Cost
(C/lb)
H
I
No Cost Segment 54

Moderate Cost
Segment 46
2,181
925
13
0.08
SOURCE: ADL Estimates
-------
The recovery of zinc from old scrap, approximately one-half from zinc-
base alloys and the rest from copper-base alloys, is a minor source of
supply, accounting for less than 5% of total zinc supply. However, zinc
recovered from new scrap accounts for nearly 15% of the total zinc supply.
Some 13 plants are considered secondary zinc distillers. New scrap origi-
nating in alloy manufacture is reused in alloys and zinc dust. Several
other plants produce zinc oxide directly from concentrates. The Western
lead smelters produce impure zinc oxide by slag fuming.

The zinc industry is an international basic industry with worldwide
influence and dependence in mining, smelting and trade. In tonnage of
metal, zinc ranks fourth following steel, aluminum, and copper. Many large
domestic producers through subsidiaries or stockholdings operate foreign
properties in both the developed and developing countries and are also
involved domestically in the production of other nonferrous metals such as
aluminum, lead and copper. The financial posture of some of the companies
has been changed by expropriation of certain foreign holdings and nationali-
zation in other countries continues to be a threat.

The domestic copper, lead and zinc industries are interdependent to the
extent that by-products or residues from one industry form a part of the
input to the other. In particular, the western copper, lead and zinc indus-
try is a significant producer of by-products. The by-product supply and
production is generally inelastic, i.e., not dependent on demand or price
of the by-product but dependent only on the primary metal production.

Because of this mechanism, any increase in smelting or-refining costs
cannot be "absorbed" by the smelter or refinery but can only be passed
backward to the mine and the net-back (the net concentrate value realized
at the mine; e.g., smelter payment minus transportation costs) would be
decreased. Should the market supply/demand constraints permit an upward
adjustment in primary metal price, the benefit from this increase is also
reflected back to the mine.

Over the past 20 years, world consumption of zinc has been increasing
at an average annual rate of 3.5-4% to its present level of 5 million tons
per year. However, the current consumption is lower than the 1969 peak of
5.2 million tons. Zinc usage patterns in the U.S. are different from those
in the rest of the world and based on die casting—mainly for the automotive
industry—rather than galvanizing. The U.S. is a leading consumer of slab
zinc, accounting for about one-fifth to one-quarter of Free World production
and consumption. With a 60% decrease in domestic smelting capacity, the
U.S. will become a major importer of slab zinc.
1-12
-------
Compared to copper and lead, zinc prices have been relatively stable
until recently. With increasing dependence on imports of slab zinc to
fulfill domestic demand, the domestic prices will be more closely related
to the world producer price than in the past and would be expected to differ
from the latter by the "traditional spread" of about 1-1/4 to l-3/4
-------
TABLE 1-6
Parameter

Total Suspended
Solids

Arsenic

Cadmium

Selenium

Zinc

PH
RECOMMENDED EFFLUENT GUIDELINES
FOR PRIMARY ZINC SMELTING AND
BPT
Av. of daily
values for 30
Max. for consecutive
any one days shall not
day exceed
(lb/1000
0.42 0.21
1.6 x 10~3 8 x 10~4
0.008 0.004
0.08 0.04
0.08 0.04
7-10
REFINING
BAT

Max. for
any one
day
Ib product)
0.28
1.1 x 10~3
5.4 x 10"3
0.054
0.054
, NSPS
Av. of daily
values for 30
consecutive
days shall not
exceed

0.14
5.4 x 10~4
2.7 x 10~3
0.027
0.027
7-10
SOURCE: Effluent Guideline Development Document
1-14
-------
TABLE 1-7
Percent
of
Industry
SUMMARY OF IMPACT OF

BPT COSTS ON PRIMARY

ZINC SMELTING AND REFINING
Employment
Added Investment/
Average Annual
Plant Investment
Added Investment/
1972 Net Capital
In Place
Increase
in
Operating
Cost
(C/lb)
No Cost Segment 28

Moderate Cost
Segment 72
i
M
Ui
1,589
3,975
0.04
SOURCE: ADL Estimates
-------
TABLE 1-8
Percent
of
Industry
SUMMARY OF IMPACT OF

BAT. NSPS COSTS ON PRIMARY

ZINC SMELTING AND REFINING
Employment
Added Investment/
Average Annual
plant Investment
Added Investment/
1972 Net Capital
In Place
Increase
in
Operating
Cost
M
I
A. Breakdown Based
on Total BAT
Cost:

No Cost
Segment 14

Moderate
Cost Segment 86
989
4,575
0.07
Breakdown Based
on Incremental
Cost above BPT:

No Cost
Segment

Moderate
Cost Segment
71
29
3,664

1,900
0.11
SOURCE: ADL Estimates
-------
E. SECONDARY COPPER SMELTING AND REFINING

1. Industry Description

There are approximately 70 producers of either brass and bronze ingots
or secondary refined copper in the United States. A majority of these are
small, privately-owned plants about whom information is unavailable. Our
analysis is limited to 44 of the larger plants which represent over 95% of
the productive capacity and over 90% of the employment in the industry.

The plants in this industry fall into two fairly distinct categories:
producers of brass and bronze and the producers of unalloyed copper. There
are 37 brass and bronze plants. The plant size is small with production
ranging from 50 to 1000 tons/month and employment of 10-500 people. They
account for 32% of the production from this industry. They generally pro-
duce semi-finished products such as ingots or shot made to specifications.
Several of these plants are diversified into other secondary metal processing
such as secondary aluminum, secondary lead and zinc, and so on. There are
seven producers of unalloyed copper who account for 65% of the production.
The plant size ranges from 1,500-18,000 tons/month with employees ranging
from 100 to 1,800 people. These plants generally utilize more sophisticated
technology and equipment and are integrated forward towards producing
finished products such as tubes and rods. Some plants also produce precious
metals as recovered by-products.

The secondary copper industry operates with a relatively fixed margin
(between price of scrap and price of product) somewhat like the primary
industries described earlier but there are several differences. For example,
secondary smelters pay for up to 75% of the purchase price of scrap at the
time of shipment, while the products are sold on credit. This method of
buying for cash and selling en credit creates a tremendous need for cash
liquidity and makes the margin much more volatile compared to the primary
industry. In 1972-73, these margins were 6-7c/lb and 5-10c/lb respectively
for brass and bronze producers and unalloyed copper producers.

2. Impact Analysis

a. Proposed Effluent Guidelines

There was no subcategorization of this industry. The guidelines for
BPT, BAT and NSPS are no discharge of process waste water pollutants to
navigable waters except excess rainwater meeting the criteria in Table 1-9.
These criteria presumably apply also to periodic blowdown from wet scrubbing
systems for air pollution control.

It should be noted that about 41% of the industry discharges to municipal
sewer systems. Such operations are not affected by these guidelines.
1-17
-------
TABLE 1-9
RECOMMENDED EFFLUENT GUIDELINES FOR SECONDARY

COPPER SMELTING AND REFINING
Parameter

Total Suspended Solids

Copper

Zinc

Oil and Grease

PH
Maximum for
Any One Day
50

0.5

20
Average of Daily
Values for 30
Consecutive Days
Shall Not Exceed
551715

0.25

10
7-10
SOURCE: Effluent Guideline Development Document
1-18
-------
b. Economic Impact

The guidelines document shows that only one plant is affected wMch
falls in the moderate cost category.

Table 1-10 shows the impact of these guidelines on this plant. It
can be seen that the increase in operating cost of 0.07c/lb is small and
is well within the cyclical variations experienced by the industry and the
variations in operating costs or operating margin from plant to plant.
Thus we expect no discernable impact resulting from the costs shown for the
Effluent Guideline alone. (cf. Limitations of Analysis)

F. LIMITATIONS OF ANALYSIS

The analysis presented in this report has several limitations:

• The costs provided by the Effluent Guidelines Development
Document are order-of-magnitude costs (at best + 30%) applicable
to model plants. At individual plants, certain site-specific
factors can invalidate the model costs and actual costs can
be an order-of-magnitude apart.

• The economic impact analysis is based on considering these
costs alone. However, economic impact on an industry results
from a wide variety of factors such as changing demand, in-
creasing raw material, energy and labor costs, pollution-related
costs and so on. Even when the impact of each individual
parameter is small, their cumulative impact can be large
and quite severe. In general, an adverse economic impact
results from any parameter that decreases an operation's
profitability. Thus the impact analysis here only puts the
pollution-related costs in the perspective of several
"indices" such as operating margin, past rate of capital expen-
diture and so on. The fact that pollution-related costs' are
small compared to these "indices" should not be interpreted
to mean that there will be no cumulative impact.

• This report is based on costs and prices in 1972-1973.
Inflation since then has increased costs of equipment, while
the worldwide recession has had a dampening effect on non-
ferrous metal prices. This would tend to increase the
severity of the cumulative economic impact.
1-19
-------
TABLE I-10

SUMMARY OF IMPACT OF BPT, BAT COSTS ON SECONDARY

COPPER SMELTING AND REFINING
Percent
of
Industry
~
Employment
Additional Investment/
Average Annual
Plant Investment
Additional Investment/
1972 Net Capital In Place
a)
Increase in
Operating Cost
(C/lb)
i
N3
O
No Cost Segment NA

Moderate Cost
Segment NA
NA
NA
0.07
SOURCE: ADL Estimates
-------
Part II. Primary Copper
Smelting and Refining
-------
II. PRIMARY COPPER SMELTING AND REFINING
A. INTRODUCTION

This portion of the study is aimed at supplying the Environmental
Protection Agency with background information relevant to the assessment
of the economic impact on the U.S. primary copper smelting and refining
industry of the costs of pollution abatement requirements under the Federal
Water Pollution Control Amendments of 1972 for each of the three standards
under consideration:

1. Proposed Best Practicable Technology (BPT) - to be met by
industrial dischargers by 1977.

2. Proposed Best Available Technology (BAT) - to be met by
1983.

B. INDUSTRY DESCRIPTION*

Copper is widely distributed in nature. The earth's crust is estimated
to contain an average of 55 parts per million. However, despite its wide
distribution, there are relatively few large copper producing areas in
the world. Important copper producing regions are: (1) the Western United
States; (2) the western slope of the Andes in Peru and Chile; (3) the cen-
tral African Copperbelt in Zambia and the Congo (Kinshasa); (4) the Ural
Mountains and the Kazakstan region in the U.S.S.R.; (5) the Precambrian
area of central and western Canada; (6) the Keweenaw Peninsula of Northern
Michigan; and (7) Southwest Pacific.

There are many copper minerals but only a few, chalcocite, chalcopyrite,
bornite, chrysocolla, azurite, and malachite, are important commercially.
Copper ores occur in many types of deposits in various host rocks. Porphyry
copper deposits, however, account for about 90% of the U.S. production and
much of the world output, and contain most of the estimated commercial cop-
per reserves of the world. From a processing viewpoint, copper ores can
be classified into three categories: sulfide ores, oxide ores and native
copper ores.

A sulfide ore is a natural mixture containing copper-bearing sulfide
minerals, associated metals and gangue minerals (e.g., pyrites, silicates,
aluminates) that at times have considerable value in themselves (e.g.,
molybdenum, silver, gold, as well as other metals). The majority of the
*Based in part on "Mineral Facts and Problems", U.S. Department of Interior,
Bureau of Mines, Bulletin 650 (1970).
II-l
-------
sulfide or-^s of the world can be classified into three major groups, all
of which are represented in the U.S.; namely:

• The porphyry copper and Northern Rhodesian type deposits that
carry copper mostly in the form of chalcocite (Ci^S) , chalcopyrite
(CuFeS2) and bornite (Cu^FeS^). In these ores, copper ranges
from a. fraction of one percent to several percent, arid iron
is generally low. The copper deposits in the southwestern U.S.
are of this type.

• Deposits, such as those found in Rio Tinto in Spain, Cyprus
and Tennessee, commonly known as cupriferous pyrite, which
generally have 1-3% copper as chalcopyrite, and contain
abundant amounts of pyrite and pyrrhotite. Generally, cop-
per to iron ratios and copper to sulfur ratios are low.
• Arsenic-bearing copper ores, such as enargite (Ck^AsS^) , with
deposits occurring in Butte, Montana; Yugoslavia; Tsumeb,
Southwest Africa; and the Philippines.

The sulfide ores are treated primarily by crushing, grinding and froth
flotation to produce a concentrate (or several concentrates) of sulfide
minerals and reject the worthless gangue as tailings.

All non-sulfide, non-native ores of copper are termed "oxide" ores;
the oxide copper content being measured by and synonymous with solubility
in dilute sulfuric acid. An oxide copper ore. can contain copper oxide,
silicate or carbonate minerals and gangue. In the southwestern U.S., many
deposits have a capping of oxide ore, below which can occur a transition
zone containing various mixtures of oxidized and sulfide copper minerals
occurring together and then the primary sulfide deposit. The oxide ores
have been treated metallurgically in a variety of ways; the character of
the gangue minerals having a very important bearing on the type of metal-
lurgical treatment used. Oxide ores in the U.S. are treated primarily by
leaching with dilute sulfuric acid.

In addition, there are ores in which copper occurs as the native metal.
The Lake Superior District in Michigan is the only major source of ore of
this type. Although the reserves of this ore are quite extensive, it con-
tributes only a small portion of the total U.S. mine production of copper.

Commonly associated with copper are minor amounts of gold and silver
and locally lead and zinc, the recovery of which can have an important
bearing on mine profitability. For example, molybdenum, lead or zinc are
recovered as sulfides by differential flotation in some plants treating
copper ores, and minor amounts of selenium, tellurium, precious metals,
etc., are extracted in electrolytic refining. On the other hand, the
presence of arsenic, antimony and bismuth in the ores leads to problems
in standard pyrometallurgical processing and electroref inirig and involves a
cost penalty. Similarly, nickel and cobalt can interfere with electrolytic
refining but they do not occur in significant amounts with the U.S. copper
deposits .

11-2
-------
1. Apparent Reserves

Domestic reserves of copper ore in 1964 were reported by the Bureau of
Mines as 75 million tons of metal in ore averaging 0.86% copper, assuming
recovery at 90% of gross metal content. An additional 58 million tons of
copper were estimated in the potential resources and may be recovered with
future technological or economic improvements. Arizona, Montana, Utah, New
Mexico, and Michigan were the leading states in measured and indicated
reserves, with Michigan having the largest inferred reserves. These five
states accounted for more than 90% of the total reserves, 95% of which are
in copper ores, and the remainder in mixed or complex base-metal ores.

However, almost half of the reported reserve is in states east of the
Mississippi River which in 1968 accounted for only about 7% of domestic
output. The native copper ores in Michigan which, at one time accounted
for substantial domestic production and comprise a substantial portion of
the reported reserves, are complicated by an erratic mineralization and
concealment of outcrops by glacial drift.

A large in-use resource of copper has accumulated and is growing in
highly industrialized countries. In the United States, the copper-in-use
pool resource has reached an estimated 40 million tons. Comparable data
are not available for other countries.

The reserves mentioned above were based on material that could be mined,
processed and marketed at profit under the economic and technological con-
ditions prevailing at the time of the inquiry—about 1964.

The reserves at any particular mine are affected by the prevailing
economic conditions and depend on the net-backs (net profits at mine)
received by the mine. These economic inputs can be translated into a cut-
off-grade, which is the metal grade of a block of ore which would produce
a predetermined net-back. Thus, any block of ore above the cut-off-grade
is mineable while that below the cut-off-grade can be either left in place
or mined and discarded as waste. Economic factors such as long-term
increases in sales price and lower operating costs from improved technology
permit a lowering of the cut-off-grade and consequently, an increase in
reserves and mine life. Alternately, any factors that decrease the net-
backs to the mine such as increasing operating costs (from pollution
abatement or otherwise) and lower prices will result in an increase in the
cut-off-grade and a decrease in reserves and mine life. Under extreme
pressures, for example when netbacks are lower than out-of-pocket costs,
the mine would have to be shut down.

2. Mining

Copper ores have been mined by open pit or underground methods. Open
pit mining produces the largest tonnage of copper values in the U.S.

The operations involved in preparing a mine for ore extraction are
called mine development. In underground mines, these operations include
II-3
-------
principally preparation of openings to and into the ore body, such as tunnels,
crosscuts, drifts, raises, and shafts. The major operations in developing
an open pit mine are stripping (removal of barren or low-grade overburden)
and the establishment of mine transportation systems.

Large disseminated deposits lying at considerable depths, veins, and
other deposits of tabular and irregular form which are usually deep are
mined by underground workings. There are three distinct types of caving
methods used in underground mining—block, top slicing, and sub-level, of
which block caving is most important. It consists of dividing suitable
ore bodies into blocks of predetermined size and undercutting each to induce
rock stresses to cave and crush the ore to sizes that can be readily handled.
Block caving is applicable to homogeneous and rather weak ore bodies of
regular outline with enough horizontal area to cave freely. The method is
nonselective in that lean sections of the ore as well as waste will be
broken up and drawn with the ore.

Underground mining by supported stopes involves excavating the ore by
a series of horizontal, vertical, or inclined workings in veins or large
irregular bodies of ore or by rooms in horizontal deposits. It covers
breaking ore and removing it from underground workings and timbering, rock
bolting, and filling for support. The costs of this type of underground
mining vary greatly and are dependent on the method of support of the walls
and the roof and the methods of handling the broken ore. This method
requires large amounts of skilled labor.

The choice between open pit and underground mining of a given ore
deposit is based upon factors such as size, shape, and depth of ore body.
Relative costs of mining by open pit or by an underground method are influ-
enced by such factors as the dilution of the ore with waste, topography and
surface improvements required, climate, availability of skilled labor,
probable continuity of operation, and available capital. An important con-
sideration in choosing the open pit method is preliminary stripping, which
must be done before the ore can be produced at plant capacity. At several
mines in the U.S., waste equal to about 1/5 of the total estimated ore
reserves had to be removed before the planned rate of production could be
attained. Advantages of open pit mining include: flexibility and ability
to obtain large-scale production, ease with which the rate of production
can be increased or decreased once the pit has been developed fully, small
shutdown expense and the ability to mine selectively to meet requirements
for certain grades of ore, virtually complete extraction of the ore inside
the pit limits, the comparatively small labor force required, and elimina-
tion of hazards inherent in underground mining operations. On the other
hand, there are certain disadvantages which have a direct bearing on the
economic considerations of mining. Large open pit operations involve heavy
capital outlay for equipment and when the amount of overburden to be removed
is extensive, a correspondingly high capital expenditure is required for
stripping. This capital is nonproductive until ore mining Ls begun so that
during the stripping period interest charges accumulate. The time elapsed
before production begins may itself be a serious disadvantage, especially
if exploration is undertaken when ore prices are favorable and the demand

II-4
-------
for the metal is strong. Serious problems can be encountered in the dis-
posal of waste, especially when the terrain is flat or dump areas near the
mine have a high real estate value, as well as climatic conditions which
may limit or necessitate complete closing of operations during certain
months.

Nevertheless, the cost of open pit mining has been decreasing steadily
because of the use of larger and larger mining and transportation equipment
and it is the predominant method for mining copper.

3. Beneficiation

Copper occurs in nature in several different mineral forms (sulfides,
carbonates, oxides, native copper, etc.) and each type requires a different
processing technique. Many methods have been used to beneficiate the ores
but, in general, only the sulfide ores are amenable to concentration pro-
cedures such as grinding and froth flotation.

a. Milling of Sulfide Ores

These ores are the most important source of copper and are concentrated
by using froth flotation techniques. This procedure requires crushing and
grinding and classification to about 100 mesh, or finer, to liberate the
particles. Grinding is usually the largest single item of cost in the
process and, hence, of great importance. After grinding, the ore-water
mixture is treated with reagents to condition the sulfide particles so that
their surfaces become air avid. The sulfides are then collected with the
froth produced in the flotation cells. The final concentrate may contain
from 11 to 32Z copper. Typical selective or differential flotation prac-
tices in copper ore beneficiation are separation of copper sulfides from
pyrite, recovery of molybdenum from copper concentrate, and recovery of a
copper concentrate, from complex lead-zinc-copper ore.

The treatment of mixed ore, containing both sulfide and oxide minerals,
depends on the relative proportions of the two types of minerals. If sul-
fides predominate, flotation is used, employing reagents that favor flotation
of oxide minerals. When the ore contains almost equal amounts of sulfide and
oxide minerals, combinations of leaching and flotation are used. In one
method, the ore is leached with sulfuric acid and the residue is treated in
a concentrator where sulfide minerals are recovered by flotation. In another
process, the leach-precipitation-float process (LPF), the oxide minerals are
dissolved by leaching and the copper is precipitated by sponge iron or sul-
fide ions which readily respond to flotation thus recovering the precipitated
copper along with the sulfide minerals.

b. Oxide Ores

Oxide ores occurring in the United States are generally not amenable to
flotation, but are generally soluble in various leaching solutions.

Acid Leaching; The ore is properly sized, if necessary, and leached

H-5
-------
with acid which dissolves the copper. Depending on ore grade and character-
istics, the ore is leached in vats (by percolation or with agitation) in
heaps, or in-place.

Dump leaching is used to extract copper from low-grade waste material
resulting from open pit mining of copper ore deposits; the leaching cycle
is measured in years. Heap leaching is employed to dissolve copper from
oxide ore that has been placed on a prepared surface; the leaching cycle
is measured in months. In-place leaching techniques are applicable to
shattered, broken, or otherwise porous ore bodies for leaching oxide and
sulfide ores of copper and other metals; the leaching cycle is measured in
years. Vat leaching is employed to extract copper from crushed and sized
oxide or mixed oxide-sulfide ores containing more than about 0.5% acid-
soluble copper; the leaching cycle is measured in days.

Sulfuric acid is usually the only practical acidic solvent for oxidized
copper minerals. The presence of ferric sulfate in the leach solution can
solubilize some sulfide minerals such as chalcocite. For dissolution of
the oxide minerals, about 1.5 pounds of acid per pound of contained copper
are required. However, total consumption is often much greater because of
reaction with gangue minerals. The presence of acid-consuming minerals,
such as calcite or dolomite, in the ore can make the process prohibitively
costly. In the present context, an excess of acid will be available in the
Western U.S. after 1976 which will have to be disposed. Acid leaching of
oxide ores high in acid consuming ingredients might be a cheaper alternative
to limestone neutralization of some of the acid, if such ores are available.

Copper is recovered from dilute leach solutions by precipitation with
scrap iron and from concentrated leach solutions by electrowinning. Recently,
liquid ion exchange has been successfully used for selectively extracting
copper from dilute streams and producing purified concentrated streams of
copper sulfate ideally suited for electrowinning.

Other Methods: Ammonia leaching has been used in the past for copper
carbonate ores where acid consumption was very high due to carbonate gangue
minerals.

Flotation has been practiced successfully on some oxide ores in Africa.
Recent work has also indicated some limited success in floating copper
silicates (chrysocolla), but it is far from being acceptable commercially.

Cyanide leaching is also a possibility and is current^ being promoted.
The problems relate to recovery of the cyanide for reuse and reagent con-
sumption associated with the cyanide recovery.

A recent pyrometallurgical process is the segregation process which is
based on heating high grade oxide ore with salt and coke. Copper migrates
to the reductant surface and forms a massive film around coke particles.
This metallic copper can then be separated from the gangue by flotation.
II-6
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4. Smelting Practice

Because most of the U.S. copper is extracted from low-grade sulfide ores
that require concentration, current pyrometallurgical practice for recovery
of copper from its sulfide concentrates is fairly uniform from smelter to
smelter and is adapted to treating fine grained sulfide concentrates con-
sisting mainly of copper and iron sulfides and gangue.

Copper's strong affinity for sulfur and its weak affinity for oxygen as
compared with that of iron and other base metals in the ore forms the basis
for the three major steps in producing copper metal from sulfide concentrates;
roasting, smelting and converting.

a. Raw Materials

Flotation concentrates containing from 15-30% copper constitute the bulk
of the feed to the smelters. In addition, smelters will charge cement cop-
per (produced by acid leaching of oxide ores and precipitation with iron)
containing 70-85% copper, siliceous flux and limestone and a quantity of
direct smelting ore containing 4-8% copper. This type of ore, when avail-
able, functions as a source of copper as well as a flux.

b. Drying

The flotation concentrates received by the smelter are a wet filter cake
and can contain 10-15% moisture. Cement copper can contain as much as 30%
moisture. The charge to a reverberatory furnace can be dried so that its
overall moisture content is 4-8% without unduly increasing dusting problems
in the reverb. The removal of moisture in drying reduces the fuel require-
ments in the reverb. Also the drier acts as a blender for homogenizing the
charge. Rotary or multiple hearth driers are used for drying the feed
materials.

c. Roasting

About half the copper smelters in the U.S. roast their charge prior to
feeding in the reverberatory furnace. The older smelters use multiple
hearth roasters for this purpose while the new smelters use fluidized bed
roasters.

The object of roasting copper sulfide ores and concentrates is to
regulate the amount of sulfur so that the material can be efficiently melted
and to remove certain volatile impurities such as antimony, arsenic, and
bismuth. However, in modern practice, the grade of the concentrate produced
from some sulfide ores is sufficiently controlled at the concentrator to
eliminate roasting prior to reverberatory smelting. In the case of custom
or toll smelters, the composition of feed materials can vary widely. Hence,
roasting is practiced to blend and control the sulfur content of the charge.

Elimination of some of the sulfur in roasting results in a higher grade
matte in the reverberatory furnace and hence decreases the oxidizing load
II-7
-------
on the converters. Sulfide roasting is autogeneous and additional fuel is
not required. The charging of hot roasted calcines into the reverberatory
furnace can decrease its fuel consumption per ton of charge by about 40%
and consequently increase reverb capacity. In addition, roasting also
reduces the emissions of sulfur dioxide from the reverb. The reason for
this is as follows: the two major constituents of concentrates utilized by
almost all the U.S. smelters are chalcopyrite, CuFeSo, and pyrite, FeS2-
These minerals contain sulfur that is loosely held or "labile" which is
given off by melting the minerals.

2CuFeS2 = Cu2S + FeS + S

FeS2 = FeS + S

Cu2S and FeS form matte, whereas the labile sulfur reacts with oxygen in
the reverb gases to form SOo. Removal of the labile sulfur during roasting
can reduce emissions from the reverb. Also the lower fuel requirement per
ton of charge when using calcine smelting reduces the volume of reverb off-
gases .

Both types of roasters (multiple hearth and fluidized bed) usually oper-
ate around 1200°F. Sulfur dioxide concentration in the wet off-gas is
usually 2-10% with multiple hearth roasters because of dilution with air.
With fluid bed roasters the wet off-gases can run 12-14% sulfur dioxide.
Both types of roasters, therefore, can produce a steady stream of relatively
rich off-gases suitable for sulfuric acid manufacture after cooling and
dust removal. Both types of roasters involve handling and collecting of
large quantities of hot abrasive dust which can lead to high maintenance
costs.

d. Reverberatory Furnace Smelting

Roasted and unroasted materials are melted after mixing with suitable
fluxes in reverberatory furnaces. Liquid converter slag is also charged
into the reverberatory furnace to recover its copper content. Heating of
the charge is accomplished by burning fuel in the furnace cavity, the heat
being transmitted to the charge primarily by radiation from the roof, walls
and flame.

Almost all the reverbs in the U.S. use natural gas as a fuel and only
one plant uses powdered coal. Because of the impending domestic shortage
of natural gas, most smelters are now installing facilities to burn alter-
nate fuels. The maximum smelting capacity of a reverb is limited by the
amount of fuel that can be burned (a function of reverb shape and size) and
the quantity of heat required by a unit weight of charge. Reverb through-
put can be increased by drying the charge, preheating the charge by roasting
and preheating the combustion air.

In the reverberatory furnace, copper and sulfur form the stable copper
sulfide, Cu2S. Excess sulfur unites with iron to form a stable ferrous
sulfide, FeS. The combination of the two sulfides, known as matte, collects
II-8
-------
in the lower area of the furnace and is removed. Such mattes may contain
from 15 to 50% copper, with a 40 to 45% copper content being most common,
and also contain impurities such as sulfur, antimony, arsenic, iron, and
precious metals.

The remainder of the molten mass containing most of the other impurities
and known as slag, being of lower specific gravity, floats on top of the
matte and is drawn off and discarded. Slags in copper smelting are ideally
represented by the composition 2FeO.Si02, but contain alumina from the
various charge materials and calcium oxide which is added for fluidity.
Since reverb slags are discarded, the copper contained in the reverb slag
is a major cause of copper loss in pyrometallurgical practice. The concen-
tration of copper in the slag increases with increasing matte grade. This
behavior limits the matte grades normally obtained in conventional rever-
beratory practice to below 50% Cu.

When using a reverb for green charge smelting, 20% to almost 45% of the
sulfur in the feed is oxidized and is removed from the furnace with the
off-gases. The wet off-gases can contain 1.5-3% sulfur dioxide. When using
calcine smelting, sulfur dioxide evolution is lower and about 10-15% of the
sulfur in the unroasted feed material is contained in the reverb off-gases.
S02 concentration in the wet off-gases in this case can vary between 0.5 to
1%.

The hot gases from the reverb are cooled in waste heat boilers which
extract up to 50% of the sensible heat in the gases. A considerable amount
of dust is removed in the waste heat boiler and the gases are further cleaned
in electrostatic precipitators before venting to the atmosphere.

Reverberatory furnaces can vary in width from about 22 feet to 38 feet
and in length from about 100 feet to 132 feet. The roofs of the older
reverberatory furnaces are sprung arch silica roofs, while almost all the
newer furnaces have suspended roofs of basic refractory. Over the years
two types of reverberatory furnaces have evolved, each with its specific
charging methods. The first and older is the deep bath reverberatory furnace
which contains a large quantity of (in excess of 100 tons) molten slag and
matte at all times. In modern deep bath reverberatory furnaces, the molten
material is held in a refractory crucible with cooling water jackets along
the sides which greatly diminishes the danger of a breakout of the liquid
material. In deep bath smelting several methods exist for charging. Wet
concentrates can be charged using slinger belts (high speed conveyors) that
spread the concentrates on the surface of the molten bath. Dry concentrates
or calcines from the roaster can be charged through the roof or via a Wagstaff
gun, (an inclined tube). Roof charging (side charging) is rarely practiced
in conjunction with deep bath smelting because of dusting problems with fine
dry calcine and explosion problems with green charge. Wagstaff guns minimize
these problems and are commonly used.

The second type of reverberatory furnace is the dry hearth type in which
a pool of molten material exists only at the tapping end. The dry hearth
type furnaces are charged with wet or partially dried concentrates (green

II-9
-------
feed smelting), or with calcines through the roof. In the latter case the
dusting problem can be quite severe for fine concentrates.

e. Converting

Matte produced in the reverberatory furnace is transferred in ladles to
the converters using overhead cranes. The converters used in copper smelting
are of the cylindrical Fierce-Smith type, the most common size being
13' x 30'. Air is blown from the side through a series of openings called
tuyeres. During the initial blowing period (the slag blow) FeS in the matte
is preferentially oxidized to FeO and Fe30^ and sulfur is removed with the
off-gases as SC^. Flux is added to the converter to combine with iron
oxide and form a fluid iron silicate slag. When all the iron is oxidized,
the slag is skimmed from the furnace leaving behind "white metal" or molten
CuoS. Fresh matte is charged into the converter at this stage and the slag
blowing continued until a sufficient quantity of white metal has accumulated.
When this happens the white metal is oxidized with air to blister copper
during the "copper blow". The blister copper is removed from the converter
and cast or subjected to additional fire refining prior to casting. Con-
verter blowing rates can vary between 12,000 to 30,000 scfm of air. Also,
the SC>2 content of the off-gases is lower during "slag blow" than during
"copper blow".

Cooling of the hot converter gases is necessary in order to prevent
thermal damage to the dry gas cleaning equipment. Normally, this is accom-
plished by adding dilution air that can vary in quantity from 1 to 4 times
the converter off-gas. With dilution air, SC>2 concentrations in the con-
verter off-gases can vary from 1-7%. With close fitting hoods or with
Hoboken converters, the off-gases average 5-10% SQ2- However, when dilution
air is not used, cooling devices such as waste heat boilers, air/gas heat
exchangers or water sprays are necessary.

The converter gases pass via a balloon flue or individual high velocity
flues to dry gas cleaning equipment such as cyclones or electrostatic pre-
cipitators. When these gases are to be used for acid manufacture and
electrostatic precipitator for dry gas cleaning is not essential since the
wet gas cleaning system (wet scrubber, electrostatic demister, etc.) removes
all the particulates from the gas stream. Thus, with proper hooding, the
converter off-gas is sufficiently high in sulfur dioxide so as to be suit-
able for sulfuric acid manufacture, but converting by its very nature is a
batch operation and the off-gas flow rates vary widely. In the smaller
copper smelters which use two or three converters, the scheduling of con-
verter blows in order to obtain relatively steady flows to the acid-plant
is a difficult problem.

5. Refining

The blister copper produced by smelting is too impure for most applica-
tions and requires refining before use. It may contain silver and gold,
and other elements such as arsenic, antimony, bismuth, lead, selenium,
tellurium, and iron. Two methods are used for refining copper - fire
refining and electrolysis.

11-10
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The fire-refining process employs oxidation, fluxing and reduction. It
is based on the weak affinity of copper for oxygen as compared with that of
the impurities. The molten metal is agitated with compressed air, sulfur
dioxide is liberated and some of the impurities form metallic oxides which
combine with added silica to form slag. Sulfur, zinc, tin, and iron are
almost entirely eliminated, and many other impurities are partially elimin-
ated by oxidation. Lead, arsenic, and antimony can be removed by fluxing
and skimming as a dross. After the impurities have been skimmed off, copper
oxide in the melt is reduced to metal by inserting green wood poles below
the bath surface (poling). Reducing gases formed by combustion of the pole
convert the copper oxide in the bath to copper. In recent years, reducing
gases such as natural gas or reformed natural gas have been used. If the
original material does not contain sufficient gold or silver to warrant its
recovery, or if a special purpose silver-containing copper is desired, the
fire-refined copper is cast directly into forms for industrial use. If it
is of such a nature as to warrant the recovery of the precious metals, the
fire refining is not carried to completion but only far enough to insure
homogeneous anodes for subsequent electrolytic refining.

In the electrolytic refining step anodes and cathodes (thin copper start-
ing sheets) are hung alternately in concrete electrolytic cells containing
the electrolyte which is essentially a solution of copper sulfate and sul-
furic acid. When current is applied, copper is dissolved from the anode
and an equivalent amount of copper plates out of solution on the cathode.
Such impurities as gold, silver, platinum-group metals, and the selenides
and tellurides fail, to the bottom of the tank and form anode slime or mud.
Arsenic, antimony, bismuth, and nickel enter the electrolyte. After the
plating cycle is finished, the cathodes are removed from the tanks, melted,
and cast into commercial refinery shapes. The copper produced has a minimum
purity of 99.9%.

6. Historical

Until the beginning of this century, only the high-grade deposits of
copper could be mined economically and treated for the extraction of copper.
The discovery of froth flotation techniques for beneficiation of sulfide
minerals early in this century enabled the exploitation of low-grade sulfide
deposits. Around this time the market for copper was growing because of the
start of the electrical industry and the producers of copper were able to
satisfy this demand by relying increasingly on the beneficiation of sulfide
ores. The early sulfide concentrates were relatively low in copper and high
in sulfur. Hence the early pyrometallurgical practice required roasting in
multiple hearth furnaces and converting to produce blister copper. Several
of the older smelters incorporated sulfuric acid manufacture. With improve-
ments in differential flotation it was possible to produce a sufficiently
high-grade concentrate which did not require roasting. This led to the
phasing out of multiple hearth roasters and the use of green charge smelting
in which the wet concentrates were charged directly into the reverberatory
furnace. Also, as a result of the availability of inexpensive elemental
sulfur from Frasch sources, the operation of by-product sulfuric acid plants
at smelters was no longer economical and most of them were shut down.
11-11
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7. Recent Trends in Copper Extractive Technology

Because of the framework of raw material, fuel and labor costs that has
existed for some time in the U.S., the domestic smelters have used reverber-
atory furnaces (reverbs) of increasingly larger size and capacity to smelt
copper concentrates. Under the present requirements for effLcient sulfur
oxide recovery, it is possible that the copper reverb like its predecessor,
the open hearth furnace in the steel industry, will become obsolete.

Over the past twenty-five years, several alternative smelting approaches
have been developed around the world in response to local conditions of raw
materials, energy and labor costs and by-product markets. These alterna-
tive approaches might be adaptable in the U.S. with minimal research and
development efforts. These and other approaches are briefly discussed below,
purely from the viewpoint of whether they offer technical solutions to the
problems faced by the U.S. copper smelting industry. The diiscussion in
this section does not address the question of cost-effectiveness of this
technology compared to that already in use.

In Japan a blast furnace was developed (the Momoda blast furnace) which
would accept a portion of its charge in the form of fine concentrates. This
approach can be economical for small sized plants. For many years, Nippon
Mining Company has smelted pelletized copper concentrates directly in the
converter using an enriched oxygen blast. A similar approach has been
tried at the Garfield, Utah smelter of the Kennecott Copper Corporation.

The flash smelting processes for smelting sulfide concentrates utilize
the heat of oxidation of the concentrate to form a molten matte and slag.
The best known of these are the Outokumpu flash smelting process developed
in Finland and the Inco oxygen flash smelting process developed in Canada.
In the former, the furnace is kept in heat balance by burning a fuel if
necessary and in the latter by oxygen. The steady SC^-rich stream of gas
produced by flash smelting is ideal for acid manufacture. The Inco oxygen
process produced extremely high concentrations of SC>2 and at Inco, the off-gas
was utilized for liquid SC^ manufacture. Outokumpu furnaces have been
installed in several plants around the world. Recent developments in the
Outokumpu process involve producing a matte in the flash furnace that is
essentially at the white metal stage. The advantages claimed for this
approach are the minimization or elimination of converter slag and removal
of a major amount of the sulfur in the concentrate in the flash smelter in
the form of a steady stream of off-gases which minimizes the impact of
cyclic converter operations on the acid plant operation.

Because flash smelting is autogeneous, the availability of uniform clean feed
is a very important factor when the applicability of this approach is con-
sidered. Some of the Japanese flash smelters are custom smelters and operate
on concentrates from a variety of sources.

There are two developments which would substantially decrease or elimi-
nate air infiltration and dilution of the converter off-gaseis. The first is
the Hoboken syphon converter. The Inspiration Consolidated Copper Company

11-12
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plans to install five of these converters in their new plant. The second
is the use of tight-fitting converter hoods to minimize air infiltration
and the use of waste-heat boilers for air cooling as used by Mitsubishi
at Onahama in Japan. Most U.S. copper smelters plan on installing various
types of tight-fitting hoods and appropriate gas cooling facilities.

Electric arc smelting has been practiced for many years by Boliden in
Sweden for smelting copper concentrates and scrap. This processing tech-
nique is receiving renewed attention on a world-wide basis because of its
potential in reducing and controlling sulfur oxide emissions and its ability
to operate with concentrates as well as scrap feed. Electric furnaces are
being installed at Inspiration and at Tennessee Copper. The cost and
availability of the required amount of electric energy is a major factor
in the economics of electric smelting.

In the pyrometallurgical treatment of copper concentrates, the major
portion of the copper lost during processing is that which leaves the smelter
in the slag. In conventional smelting, the high copper (about 6% Cu) con-
verter slag is fed into the reverberatory furnace for copper recovery while
the reverb slag (about 0.4% copper) is discarded. The copper content of a
slag in contact with a matte increases with increasing matte grade, hence
if the reverb slag is to be discarded, this behavior imposes an upper limit
on the matte grade in the reverb. The commercialization of various slag
flotation schemes for recovering copper from converter slags and flash
smelter slags offers several advantages.

• If converter slags are to be treated for copper recovery,
only the copper recovered has to be recycled to the reverb.
This prevents the introduction of magnetite into the reverb
from this source and avoids the problems associated with
the build-up of magnetite on the bottom of the reverb furnaces.

• The reaction of magnetite in the converter slag with the matte
causes evolution of S0?:

3Fe 0, + FeS = lOFeO + S02

This can be prevented by not recycling the slag and the S0?
content of the reverb off-gases is decreased.

• If slag from a primary smelting unit (a reverb, a flash smelting
furnace or a continuous smelting furnace) can be treated success-
fully and economically for recovering its copper content, the
copper content of the slag no longer limits the matte grade in
the primary smelting unit. Thus, high grade mattes up to the
white metal stage (containing about 80% copper) could be obtained
in the primary unit. For example, this approach is the basis
for the improvements in Outokumpu flash smelting.

The treatment of converter slags by slow cooling, crushing, grinding and
11-13
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flotation has been used at Hitachi and Naoshima in Japan, by Outokumpu and
has been incorporated in some of the recent continuous smelting methods
such as the Noranda process.

All of the developments mentioned above have been tested on a commercial
scale for many years and are adaptable to the U.S. conditions with a mini-
mal research and development effort. There are several schemes for pro-
cessing copper concentrates that are being tested at the present time in a
variety of pilot plants or semi-production facilities that produce only
concentrated S02 streams. Over the long term, they offer a potential for
reducing operating costs in comparison to the problems and costs associated
with the control of low-level 862 emissions from the copper reverberatory
furnace. Unfortunately, these processes are as yet unproveii. Prominent
amongst these are the Noranda, Worcra, Mitsubishi and other continuous
smelting processes, in which copper concentrates are treated until the
blister copper stage in a single reactor. Similarly, there are other
schemes for the direct smelting of concentrates in the converter using
such equipment as the top blown stationary converter and the top blown
rotary converter.

There exist processes for reduction of sulfur dioxide to elemental sul-
fur in various stages of development. Outokumpu is reportedly working on
a modern version of the Orkla process, a process for the reduction of S02
to elemental sulfur with a solid carbonaceous reductant. This process
has been tried in a nickel smelter in Botswana and will be utilized at the
new Phelps Dodge smelter in New Mexico. Other sulfur reduction processes
are Allied Chemical and Asarco-Phelps Dodge. However, the reduction of
S02 to elemental sulfur is expensive.

There are several hydrometallurgical approaches that can treat sulfide
concentrates. Unfortunately, none of these processes have been developed
to the degree where they can be used as a basis for a full-scale commercial
operation to replace existing copper smelters within the given time scale
for pollution abatement. (Also, the replacement of operating smelters with
new unproven processes would cause a major financial impact on the industry.)
The more interesting processes convert copper sulfide concentrates to the
metal and produce elemental sulfur which would be easier to store and
cheaper to transport than sulfuric acid. Examples are: weak acid pressure
leaching (Sherritt Gordon-Cominco process), atmospheric pressure leaching
with nitric acid, sulfuric acid bake, ferric ion leaching and chlorine
water leaching. Of course, there are several other hydrometallurgical
processes in which sulfur in the concentrate is oxidized to sulfate, but
these are of lesser interest since sulfate values have to be disposed or
marketed. Typical of these are the ammoniacal leaching processes which
Sherritt Gordon has operated on a large scale for leaching nickel sulfides,
the Arbiter process, and bacterial leaching.

8. Water Usage in the Copper Industry

a. Location vs. Usage Patterns

There is no typical plant which characterizes the water usage patterns

11-14
-------
and discharge practices for all copper smelting and/or refining operations.
Amounts of water discharged range from zero to tens of millions of gallons
per day. The overriding consideration is the cost and availability of water
in a particular area. For example, in the arid Southwest, water is scarce
and maximum recycle is used for conservation, whereas, in the northeastern
parts of the U.S., water is more abundant and is often used on a once-thru
basis.

Another important consideration is whether or not sufficient land is
available for disposal of excess water or for treatment of the water before
recycle.

b. Water Usage in Smelting Operations

Figure II-l is a generalized flowsheet showing the use of water in
smelters. These may be associated with a mine and concentrator and utilize
the same water sources, sanitary circuit, and the tailings pond for discharge,
or they may be a separate installation. The common features of the water
circuits of a smelter are the manifold cooling functions: spray cooling of
calcine in the roasting or sintering operations, where water is mostly lost
to evaporation or stays in the material; the cooling of furnace components
(doors, shells, etc.); and the cooling of the cast metal product and the
casting molds. Furnace cooling requires no contact of the water with the
material being processed, and cooling of solidified metal and molds gener-
ally results only in the pickup of mold-dressing materials (oils or silica-
base compounds) and small amounts of particulate metals. This cooling
water may be settled to remove suspended solids and recycled or discharged.
In some plants, molten slag from the furnaces is granulated with water jets,
the slurry dewatered, and the water settled and either recycled or discharged.

Smelting operations may include sulfuric acid plants. Water is used in
these in a number of ways. Water scrubbers are used to remove dusts and
fumes from sulfur dioxide gas streams from roasters and converters before
admission to the sulfuric acid plant. It might be used to dilute the sulfuric
acid product to the desired strength. It is used to cool reactors and
machinery. Acid plants produce discharges of cooling-tower blowdown and
"acid plant waters" from the sumps of the gas cleaning or conditioning steps.

As mentioned earlier, the locations of smelters vary from deserts to
seacoasts and thus sources of supply and types of receivers may include inde-
pendent systems, municipal systems, or estuarine waters, or combinations
thereof.

c. Water Usage in Electrolytic Refineries

The pattern of water usage and waste treatment or disposal in electrolytic
refineries is depicted in Figure H-2. Make-up water is used for the prep-
aration of electrolytes for both the primary product and, in many cases,
precious or other metal by-products as well as the preparation of solutions
for various leaching and chemical operations. Wet gas scrubbers may use
water for either or both of the functions of air pollution control and

11-15
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Supply
I
Furnace Cooling
(Blast, Reverb,
Converter,
Melting, etc.)
Cast Metal
and Mold
Cooling
Slag
Granulation
To
Settling,
Recycle,
Cooling
Tower, or
Discharge
To
Recycle,
Discharge,
etc.
FIGURE II-l
GENERALIZED WATER-FLOW DIAGRAM FOR SMELTER-TTffE 'OPERATION
-------
Wells, Surface Waters i
Municipal Supply Estuary 1
Treatment
Electrolytic
Refining
Mate-Up
Water
Electrode
Wash
Electrolyte
Purification
Spent
Electrolyte
By-Product
Metal
Salts
Filtrate
I
Condensate,
Slowdown
By-Product
Leach Liquors
and/or
Electrolytes
Spent
Liquors,
,,. ? Recycle
Filtrates
1
Copper
Melting
Furnace
Mold
Cast
Metal
By-Product
Metals
Refining
Furnaces
Cooling
Tower
Slowdown
J
Municipal
Sanitary Sewers
Municipal
Storm Sewers
Estuary
Surface Waters
FIGURE 11-2
GENERALIZED WATER-FLOW DIAGRAM FOR ELECTROLYTIC REFINERY
-------
by-product recovery. Practically all electrolytic refineries employ melting,
refining, and casting operations to produce salable forms of the primary and
by-product metals and require use of cooling water for furnace components,
cast metal, molds, etc. When these are located near seacoasts, cooling is
accomplished with salt water, usually pumped from and returned to estuaries.
Cooling is also required for the characteristic electrical equipment such
as transformers, rectifiers, generators, etc. Steam generation is also
required for controlling the temperature of the electrolytic baths. The
discharges from electrolytic refineries are many and varied, as are the
disposal techniques and types of receivers,

d. Specific Sources of Wastewater

Specific sources of wastewater in the copper smelting and refining
industry are as follows:

1. Water-treatment wastes, including filter backwash, sludges
from primary settling and ion-exchange regeneration solutions.

2. Sanitary wastes.

3. Indirect and direct cooling water from the cooling of furnaces,
machinery, casting operations, etc. Generally, such water is
recirculated to cooling towers or spray ponds for reuse, and
is eventually discharged as blowdown. Some plants, notably
those located near large bodies of water such as the sea, may
use once-thru cooling water.

4. Process wastes including scrubber water, smelter wastewater,
discarded electrolyte from refineries, clean-up water, etc.
Often these may be combined in tailings ponds for treatment
and recirculation.

5. Boiler and power plant wastes including boiler blowdown and
ash-pit overflow.

9. Supply and Demand

a. The World Situation

Over the past twenty years, world consumption of copper has increased
at an average annual rate of 4-4 1/2% to its present level of 7.9 million
tons per year of the refined metal. Of this total, about 6.3 million tons
are consumed by the Free World countries.

Although copper is used in myriad applications, most of these fall into
five broad categories:
11-18
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Electrical/electronic equipment - 49%
Building construction - 16%
Transportation - 12%
Non-electrical industrial equipment - 10%

Ordnance - 6%

The remaining 7% is divided among such applications as chemicals, in-
organic pigments, jewelry, and coinage.

Copper is facing increasing competition in a number of these applica-
tions. Plactics, for example, have made some inroads into tubing markets;
stainless steel is making inroads into some building construction markets.
The most serious threat, however, has come from aluminum—a commodity
product that has a relatively stable price, is produced in many areas, and
is much less subject to political and economic pressures than is copper.
Aluminum is used for virtually all high-voltage, overhead power-transmission
lines; it has replaced copper in some building construction uses; and it is
being pushed as a replacement for brass in automobile radiators.

Despite these competitive forces, consumption of copper is expected to
continue to increase worldwide at an average annual rate of about 4 1/2%
over the next decade with a lower growth rate in the industrialized countries.
Some of this increase will be the result of copper's gaining a larger share
of certain markets (e.g., coinage). Some will simply be the result of the
anticipated 5%-per-year increase in industrial production throughout the
world.

To keep pace with this mounting demand, the industry has explored for
new deposits, added capacity, and improved mining, metallurgical, and fabri-
cating technologies. Despite occasional setbacks—for example, from strikes,
political upheavals and natural disasters—world mine production has increased
about in line with demand, rising from 5.4 million tons in 1965 to 6.9 million
tons in 1970. The bulk of Free World production comes from just 11 countries
(Table II-l). Four of these—the so-called CIPEC countries of Chile, Peru,
Republic of Congo, and Zambia—account for more than half the Free World's
mining production outside the United States.

At present, copper concentrates and electrolytic refined copper are
available from most of the major producing countries. Blister copper
(copper that has been smelted but not refined) is available in quantity only
from the CIPEC countries.

Primary copper capacity is expected to increase throughout the world
(Table II-2). Overall, another 1.2 million short tons of mining capacity
is expected to be added by 1975, an increase of about 6.2% per year. Barring
serious upheavals, future demand may not be strong enough to absorb all of
the additional output that is planned.
11-19
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TABLE II-l
WORLD COPPER MINE PRODUCTION BY COUNTRY
Country
U.S.A.
Chile
Zambia
Canada
Republic of the Congo
Peru
Republic of Sout
Japan
Australia
Philippines
Mexico
Other Free World
Sino-Soviet Bloc
TOTAL WORLD
(Thousands
1965
1,356
645
767
510
ingo 318
199
Africa 67
118
96
70
76
343
867
5,433
of Short
1966
1,408
701
687
508
349
194
137
123
116
81
82
365
927 1
5,678 5
Tons)
1967
950
728
731
603
353
212
141
130
94
95
69
343
.009
,458

1968
1,203
726
755
633
358
223
141
132
112
122
67
371
1,077
5,920
1969
1970
SOURCE: Yearbook of the American Bureau of Metal Statistics - 1970
11-20
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TABLE II-2

NET INCREASE IN FREE WORLD PRIMARY COPPER PRODUCTIVE CAPACITY - 1973-1975

IN SHORT TONS, ANNUAL RATE

(Estimated as of March 16, 1972)
Estimated
Capacity
1971
Total
Planned
1972-74
Estimated
Capacity
1975
North America:

United States
Canada
Other
Total

South America:

Chile
Peru
Other
Total

Africa:

Zambia
Zaire
South Africa
South West Africa
Other
Total

Asia:

Japan
Philippines
Bougainville
West Irian
Other
Total

Australia:
1,820,000
825,000
95,000
2,740,000
840,000
240,000
15,000
1,095,000
850,000
450,000
165,000
40,000
50,000
1,555,000
140,000
220,000
85,000
445,000

2O5.OOO
28.8
13.1
1.5
43.4
13.3
3.8
0.2
17.3
13.5
7.1
2.6
0.6
0.8
24.6
2.2
3.5
1.3
7.0

3.2
197,000
202,000
38,000
437,000
28,000

35,000
63,000
2,017,000
1,027,000
133,000
3,177,000
868,000
240,000
50,000
1,158,000
26.6
13.6
1.8
42.0
11.5
3.2
0.7
15.3
104,000
115,000
45,000
(1,000)
52,000
315,000
954,000
565,000
210,000
39,000
102.OOO
1,870,000
12.6
7.5
2.8
0.5
1.3
24.7
10,000
7,000
180,000
65,000
67,000
329,000
150,000
227,000
180, OOO
65,000
152,000
774,000
2.0
3.0
2.4
0.9
2.0
10.2
75,000
28O.OOO
3.7
Yugoslavia
Finland
Other
Total

(CIPEC)

Total Net Increase*

TOTAL FREE WORLD
CAPACITY

Percent Increases
110,000
35,000
130,000
275,000

2,380,000
6,315,000
1.7
0.6
2.1
4.4

37.6
15,000
7,000
18,000
40,000

247,000

1,259,000
125,000
42,000
148,000
315,000

2,627,000

7,574,000
6.2X
(Per Year)
1.7
0.6
2.0
4.2

34.6
SOURCE: American Metal Market
11-21
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b. The Situation in the United States

The United States is both the leading producer and leading consumer of
copper, accounting for about one-third of Free World Production and consump-
tion. In 1970, for example, the figures were:

U.S.
Free World U.S.A. Share
(million short tons)
Mine Production
Refined Production
Refined Consumption
5.66
6.80
6.32
1.7
2.3
2.0
30 . 2%
33.5%
32 . 3%
SOURCE: S.D. Strauss, Trans., Inst. Min. Met. (London)
80, A169 - A174 (1971).

Despite its position as the leading producer of copper and a heavy user
of scrap copper, the United States has been in a position of under-supply
since the early 1960's. Thus it has had to make up a considerable portion
of its needs with imports of refined and blister copper (Table II-3). Most
of the imported refined metal has come from Canada; essentially all of the
imported blister copper has come from foreign sources that are tied finan-
cially to U.S. refiners. However, recently U.S. copper mine production has
been increasing at an adjusted rate of 3.5% per year, whereas consumption
has yet to regain the 1966 level.

10. The Interdependence of the Copper, Lead and Zinc Industries*

The copper, lead and zinc industries, located in western U.S. are
mutually interdependent and the existence of one industry depends to a cer-
tain extent on the existence of the other because the economics of any
particular mine, mill or smelter are dependent on obtaining co-product and/or
by-product credits for their other outputs. The overall crossflow of materi-
als between these industries is shown in Table II-4 and described in detail
below.

Several copper mills produce a small tonnage of lead or lead-zinc con-
centrates. Similarly, several lead mines and mills in Missouri produce a
copper concentrate which is shipped to a copper smelter. Lead and zinc
occur almost invariably together in the same deposit in the Western U.S.
and the mining and exploitation of these deposits is based on obtaining
adequate co-product credits for both lead and zinc and associated precious
metals.

On the smelter side there is also a flow of materials between copper,
lead and zinc industries which enables each plant to obtain by-product
*This section is identical in the copper, lead and zinc chapters.

11-22
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TABLE II-3

U. S. IMPORTS OF REFINED AND BLISTER COPPER
(Thousands of Short Tons)

Year Refined Copper Blister Copper
1965 137 333
1966 163 350
1967 330 269
1968 400 271
1969 131 238
1970 (est.) 132 224
SOURCE: Copper Supply and Consumption, 1951-1970, CDA, Inc.
11-23
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TABLE II-4
CROSS-FLOW OF MATERIALS BETWEEN PRIMARY COPPER, LEAD AND ZINC INDUSTRIES
A) Mining and Milling
B) Smelting
i
l-o
C) Refining
Source

Cu mills
Pb-Zn mills
Pb mills
Pb-Zn mills

Cu smelter
Pb smelter
Pb smelter
Pb smelter
Zn-Pb smelter
Zn Horizontal
retorts
Zn electrolytic
Cu smelter
Pb smelter
Ag-Pb-Sb-Cu cone.

Pb refinery
Pb refinery
Pb refinery
Cu refinery
Cu refinery
Material Produced
By Source

Pb-Zn concentrate
Cu concentrate
Cu concentrate
Pb cone.; Zn cone.

Pb-Zn converter dust
ZnO fume from slag
Pb-Cu dross
Au, Ag Cu matte
Cd fume

Pb-Zn residue
Pb-Zn residue
Cu-As-Sb converter dust
Cu-As-Sb speiss
Cu-As-Sb speiss

Bi dross
Au-Ag skimmings
Pb-Cu dross
Slag fume & residues
anode slimes
Industries Where Treated

Western Pb smelter; Zn smelter
Cu smelters
Cu smelters
Pb smelter; Zn smelter

Western Pb smelter
Electrolytic Zn plant
Pb smelter
Cu smelter
Cd refinery

Western Pb smelter
Western Pb smelter
Cu smelter (Tacoma)
Cu smelter (Tacoma)
Cu smelter (Tacoma)

Bismuth refinery
Au.Ag refinery
Pb smelter
Cu &/or Pb smelter
By-product refinery
(Au, Ag, Pt, Se, Te, Ni)
SOURCE: ADL
-------
credit for small quantities of residues that cannot be processed in an econ-
omical fashion internally within a particular smelter. An example of this
flow is the El Paso smelter of Asarco where a copper smelter, a lead smelter
and slag fuming facilities for zinc extraction are integrated in the same
plant. Lead, zinc and other by-products in the copper circuit are elimina-
ted as fume and dust during roasting and converting. These high lead/zinc
fumes are an input into the lead circuit. The existence of this and other
Western smelters also provides an outlet for the lead containing copper
converter dusts from the Arizona copper smelters. If this dust were recycled,
a deleterious buildup of lead would occur. In the lead circuit, copper in
the lead is eliminated during dressing as a matte and this matte is trans-
ferred back to the copper circuit. Zinc in the lead circuit is slagged in
the blast furnace and this slag is treated by slag fuming to produce zinc
oxide which is then shipped to an electrolytic zinc plant. Several by-
products are recovered from the fume and from impure lead bullion during
refining.

The interrelationship between western lead and zinc production is even
closer because the western ores differ from the Missouri ores or those in
the eastern U.S. in having a more intimate association of copper, iron,
lead and zinc sulfides and usually having a higher impurity and/or precious
metal content. As a result, the three western lead smelters (Asarco in El
Paso, Texas and East Helena, Montana; and Bunker Hill in Kellogg, Idaho)
include slag fuming facilities to recover zinc from the lead blast furnace
slag and very extensive refining and by-product recovery facilities. The
value of the by-products passing through a western lead smelter is of the
same magnitude as the value of the lead recovered. Thus, the western lead
smelters are called "lead" smelters for convenience but, in reality, handle,
process and collect several other metals such as silver, cadmium, bismuth,
antimony, and others as discussed in detail in the next section. In Missouri,
the lead blast furnace slag is sufficiently low in zinc and can be discarded.
The lead bullion is quite pure and can be refined adequately by a smaller
number of refining steps than necessary for western bullion. Should the
western lead smelters close for one reason or another, the Missouri smelters
would require major modifications in their flowsheets in order to treat western
lead-zinc ores. These modifications would have to include slag fuming facil-
ities and much more extensive lead purification and by-product recovery
facilities. In other words, even if the western lead-zinc mines could
absorb the additional freight for sending the concentrates to Missouri,
major changes would have to occur at the smelters before the concentrates
are acceptible.

The western type lead smelters also provide an essential service to the
primary zinc industry. All the processes producing primary zinc also produce
a residue that is high in lead and other inert materials such as zinc ferrite.
The amount of residue, containing zinc, associated copper, lead and precious
metals is generally higher for the marmatitic type western zinc ores. Up to
15% of the zinc in feed materials can be tied up in this fashion. The zinc
smelter economics depend to a considerable extent on being able to realize
a value for this residue. We understand that the value of this residue is
related to its copper, lead, and precious metal content and contained zinc
11-25
-------
is not accounted for. Several alternative technologies exist for treating
these residues for zinc recovery but the existence of the western type lead
smelters has enabled several zinc smelters to realize a value for the other
metal content of the residue. For example the residues from Bunker Hill's
zinc plant in Kellogg, Idaho are treated in the adjoining lead plant, and
the residues from the Oklahoma and Texas zinc plants are treated at the El
Paso lead plant. The two remaining eastern zinc smelters (New Jersey Zinc
and St. Joe Minerals), treat purer zinc ores and because of the processing
conditions, produce residues much lower in zinc or other by-products than
either the electrolytic or the horizontal retort processes used in Oklahoma
and Texas. Both these eastern plants treat their residues internally for
zinc recovery.

The western lead smelters also act as collectors of silver that is
associated with the copper concentrates obtained in several mills in Northern
Idaho. If anodes high in silver are electrorefined in a copper refinery,
silver carry-over to the purified cathodes cannot be prevented. By charging
the high silver copper concentrates into a lead smelter, silver and copper
are separated. Silver collects in the lead bullion while copper is recovered
as a sulfide dross and can then be shipped to a copper smelter.

The copper and lead ores in Idaho and Montana contain significant
amounts of arsenic and antimony. The lead smelters produce a mixture of
complex copper arsenides and antimonides termed "speiss" which requires
separate handling. Arsenic in copper concentrates can be eliminated as
fume from roasters or converters and arsenic trioxide obtained by repeated
distillation. The Tacoma smelter of Asarco is the only smelter in the U.S.
that accepts arsenical ores and concentrates or arsenical residues from
other smelting operations (for example flue dust from Anaconda and speiss
from the western primary lead and silver smelters and high arsenic concen-
trates from abroad).

Because arsenic is undesirable in the copper product, Tacoma produces
As2C>3 as a by-product and is the only domestic producer. The closing of
the Tacoma smelter for any reason would affect several northwestern producers
who require both East Helena and Tacoma to process their complex arsenic and
antimony containing products and residues. Even more important, these
residues are not disposable since the arsenic in it is in soluble form and
could be leached out by groundwater. Hence, the only realistic alternative
for them would be to set up their own arsenic treatment facilities similar
to Tacoma's and in this sense Tacoma's arsenic handling capability is
irreplaceable.

11. By-Products of the Western Mining Industry*

The nonferrous mining industry involved in the production of copper,
lead and zinc produces substantial quantities of by-products and/or co-
products that are a major portion of the domestic production of these
respective metals.
*This section is identical in the copper, lead and zinc chapters.
11-26
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About 98% of the U.S. mine production of copper is recovered from ores
mined primarily for their copper content, the remainder being recovered
from complex or base metal ores. In addition to copper, important quantities
of gold, silver, molybdenum, nickel, selenium, tellurium, arsenic, rhenium,
iron, lead, zinc, sulfur, and platinum-group metals were recovered as by-
products.

Ores containing lead also contain other valuable and recoverable com-
modities including antimony, arsenic, cadmium, copper, fluorspar, gallium,
germanium, gold, indium, selenium, silver, and zinc. Lead ranges from the
major product, as in the Missouri ores, to a co-product, as in the complex
western ores, to a by-product in the eastern ores. When treating mixed ores,
a division in contained metals is initiated during beneficiation with certain
amounts of other metals remaining in the lead concentrate. Smelter further
separates the various metals, and refining completes the dissociation.
Copper, gold, silver, and zinc are the major co-products or by-products
associated with western lead ores, and minor by-products consist of antimony,
bismuth, sulfur, and tellurium.

Zinc production affects, and in turn is affected by, the demand for and
the economic aspects of a variety of co-products and by-products. Ores
containing zinc also contain a varying amount of other valuable and recover-
able materials including cadmium, copper, fluorspar, gallium, germanium,
gold, indium, lead, manganese, silver, sulfur, and thallium. Zinc ranges
from the major product as in the Tennessee, New York, New Jersey deposits,
to a co-product as in the complex western ores and the Missouri lead belt.
In concentration of the ore, a division of metals is initiated with certain
metals remaining in the zinc concentrate. Metallurgical treatment to recover
the zinc by roasting, followed by distillation, or electrolytic process
further separates the metals and permits commercial recovery. The major
products associated with zinc and recovered at zinc plants in stack gases,
flue dusts, and residues are sulfur, cadmium, germanium, thallium, indium
and gallium. Manganese is a co-product of zinc-lead manganese-silver ores
at Butte, Montana, and zinc-manganese ores at Ogdensburg, New Jersey.

According to the U.S. Bureau of Mines, the smelting segment of the
zinc industry realizes about 89% of its revenue from production of zinc.
The two principal by-products are cadmium and sulfuric acid, representing
about 7% and 3%, respectively, of total revenue. Other by-product metals
including germanium, indium, thallium, and gallium are very minor contribu-
tors to total revenue, accounting for a combined total of about 1%.

CO-PRODUCTS FROM U.S. Cu-Pb-Zn INDUSTRY
Estimated
Quantity Gross
of By-Product Value
By-Product in Million
or Co-Product Source Short Tons $
Antimony lead-silver 1,019 1.1
Arsenic copper-lead 2,900 0.4
Bismuth lead-zinc 350 2.8
Cadmium zinc-lead 1,890 11.3
Gallium zinc NA NA
Germanium zinc 10 1.8
Gold copper 510* 30.6
Indium zinc 230* 0.7
Manganese zinc 8,000 5.3
Molybdenum copper 11,700 46.8
Nickel copper 2,000 5.0
Platinum copper 5* 0.6
Rhenium copper 1.2 2.9
Selenium copper 316 5.7
Silver lead-zinc- ±g ^^
copper
Tellurium copper 60 0.7
Thallium zinc 1.3
Quantity of
By-Product
as % of
Domestic Mine
Productionl
58
100
100
100
NA
100
34
100
NA
25
13
100
100
100
59
100
Quantity of
By-Product
as % of
Smelter/
Refinery
Production^
8
47
88
35
NA
84
30
49
NA
25
13
8
100
100
31
100
100 49
Quantity Jj
By-ProductP
as % of
Domestic 1
Demand^ |
2
12
30
28
NA
25
6
42
NA
42
1
1
310
29
11
55
40
*Thousand Troy Ounces
1. 100% indicates all of domestic production is a by-product; less than
100% indicates other production from a primary source or a source
other than Cu-Pb-Zn mining.
2. 100% indicates absence of ore imports; less than 100% (and less than
column 5) indicates ore or concentrate imports .
3. Greater than 100% (or greater than column 6) indicates exports.
4. NA: not available.
SOURCE: Adapted from Mineral Facts and Problems, U.S. Department of
Interior, Bureau of Mines, Bulletin 650 (1970).
11-28
-------
the primary product is considerably below the value shown since additional
processing is necessary. The table also puts the by-product production in
the perspective of the domestic mine production, smelter or refinery produc-
tion and the domestic demand for each of these metals. Sulfur is a potential
by-product that will be recovered (mainly as sulfuric acid) from the copper-
lead-zinc industries in quantities amounting to about 2 million tons per
year.

Antimony: Three mines located in Idaho account for the bulk of the
domestic primary production of antimony, all of which is derived incidental
to the production of lead-silver ores. Primary production of antimony at
smelters was 12,500 tons in 1969. Only about 15% of this production was
supplied by domestic sources chiefly as a co-product from silver ores or
a by-product of lead ores. By-product antimonial lead produced at primary
lead refineries was 1174 tons.

Arsenic: The only producer of arsenic in the U.S. is the Tacoma,
Washington smelter of Asarco. Their current output is around 12,000 tons
per year of arsenic oxide of which about 4-5000 tons is refined or white
arsenic. We understand from Asarco that Tacoma's arsenic production is
currently about 60% of the domestic demand.

Bismuth: Virtually all domestic production of bismuth results from the
treatment of lead smelter products. The major bismuth producer are the
Omaha refinery of Asarco and the U.S. Smelting Refining and Mining Company
in East Chicago, Illinois (now shut down). Almost all domestic bismuth
production is a by-product of the processing of coMp4ex western base metal
ores. The bismuth normally enters primary and secondary lead smelters in
varying quantities through the inputs and follows lead in the production
sequence finally reporting to the lead refinery in lead bullion. Other
sources are electrolytic sludges from copper and zinc refineries which are
sent to a lead smelter for separation and refining.

Cadmium: Cadmium is a by-product mainly of zinc smelting and to a lesser
extent of lead smelting. As cush it provides income of about 4-10% of the
value of slab zinc produced. The domestic production in 1969 amounted to
about 6,300 tons based on domestic as well as imported flue dust, and
imported zinc concentrates. Of these, 5,400 tons were produced at zinc
plants, about 2,000 tons at electrolytic zinc plants and the remainder from
retort and electrothermic plants. Until recently the domestic production
and consumption of cadmium have been more or less in equilibrium but is a
cyclical commodity and is rarely in balance for very long.

Gallium: Gallium is a by-product derived entirely from the processing
of certain aluminum and zinc ores. Gallium is recovered by just one zinc
producer, Eagle-Picher Industries, Incorporated.

Germanium: Germanium is a by-product of zinc production. One domestic
refinery produces germanium by refining residues from zinc concentrates,
from domestic mines and from residues from other zinc refineries. Germanium
is a minor aspect of this producer's base metal or manufacturing activities.
11-29
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Gold: In the U.S., by-product and co-product production of gold accounted
for 34% of the 1968 output. The major by-product gold producer was Kennecott
who recovers gold as a by-product of copper production from the anode slimes
obtained during copper electrorefining. Lead smelters and refineries are
also important collectors and processors of gold (and silver).

Indium: Indium is a by-product of zinc production. The domestic indium
industry is composed of two producers—Asarco and Anaconda—both of whom
began production about 1940. Indium metal is produced mainly as an integral
part of zinc operations or by processing indium-containing residues generated
by other zinc producers. Indium is collected in western type lead smelters
for subsequent recovery.

Manganese: Manganese is a co-product of lead-zinc manganese silver ores
in Montana and in New Jersey.

Molybdenum: About one-third of the domestic production of molybdenum is
obtained as a by-product or co-product during the processing of copper,
tungsten and uranium ores. Kennecott is the largest producer of by-product
molybdenum and recovers molybdenum from copper ores at its mines near Salt
Lake City, Utah; Hurley, New Mexico; McGill, Nevada; and Ray, Arizona. Other
large producers from copper ores are Duval and Magma. Six other companies
recovery molybdenum from copper ores. Most of these companies sell their
production as molybdenite (molybdenum sulfide concentrate) or molybdic oxide.

Nickel: Nickel is produced as a co-product of copper mined in a number
of localities outside the U.S., but is not found in significant amounts in
association with U.S. copper deposits. Nickel in anode copper can cause
problems in electrolytic refining and is extracted from the electrolyte.
Nickel in lead ores follows copper and is obtained in the sulfide skimmings.

Platinum: The major part of the U.S. output is recovered as a by-product
of copper refining in the form of anode mud.

Rhenium: Rhenium occurs in small percentages with molybdenum, copper,
manganese and non-metallics, from which it might be recovered during roasting
or smelting. Currently, rhenium supply is wholly dependent upon recovery of
molybdenite from porphyry copper ores. Molybdenite concentrates from
Kennecott mines in the western U.S. and flue dust and gas at Garfield, Utah,
are a primary source of rhenium.

Selenium: Selenium is derived domestically as a by-product of electro-
lytic copper refining. Five plants account for all the selenium production
in the U.S. These are the large electrolytic refineries of Amax, Asarco,
International Smelting and Refining and Kennecott Copper.

Silver: About 60% of the domestic silver output in 1968 came from ores
mined chiefly for copper, lead and zinc. These ores occur in the western U.S.
and the high silver concentrates (even when they are copper concentrates, or
antimony concentrates) are treated in western lead smelters where the silver
collects in the lead and is extracted from lead bullion during refining.
11-30
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Tellurium: Tellurium is a minor by-product of electrolytic refining
of copper and lead and the producers of these commodities are producers of
tellurium.

Thallium: Thallium metals and compounds are produced by Asarco which
maintains thallium producing facilities as an integral part of its cadmium
operations. Production of thallium is derived mainly from lead smelter flue
dusts, residues and other products. The value of thallium output is negligible.

C. INDUSTRY SEGMENTS

1. Types of Firms

The United States has been the largest copper producing country in the
world since before the turn of the century. The domestic primary copper
industry is composed of approximately 200 firms engaged in producing and
selling copper. The major producers are vertically integrated and have
mining, smelting, refining, fabricating, and marketing interests. Other
large producers mine and have processing facilities through the smelting or
refining stages, and many companies mine and concentrate their ores and ship
the product to custom plants for smelting and refining. The principal
domestic producers are shown in Table II-6. Of these, Anaconda, Inspiration,
Kennecott, Magma, Phelps Dodge and White Pine are integrated from mining
through primary metal production; Duval, Pima and the Miami Copper Division
of the Tennessee Corp. are involved only in mining and milling and Asarco is
the major custom smelter and refiner who purchases ores or concentrates
from other producers (custom smelting) or will treat them for a fee and
return the metal to the mining company for marketing (toll smelting).

2. Types of Plants

a. Mining and Milling

In the United States, over 300 mines produce copper. Copper ore was
the principal product of almost 200 mines, and the others, mostly lead and
zinc mines, produced copper as a by-product and co-product. The top five
mines each produced more than 100,000 tons of contained metal, amounting to
45% of the total. The ore is beneficiated (crushed, ground and metal
sulfides recovered by flotation) in mills that are located near the mines.

Most of the copper is mined in five western states—Arizona, Montana,
Nevada, New Mexico, and Utah—(93.5% in 1970) and essentially all of the
remainder came from Michigan, Tennessee, and Missouri, as shown in Table II-7
for the years 1968, 1969, and 1970.

The major copper mines are shown in Table II-8. Also included in the
table is mine employment (when available).
11-31
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TABLE II-6
PRINCIPAL COPPER-PRODUCING COMPANIES
IN THE UNITED STATES, 1970
Company
American Smelting and Refining Company
The Anaconda Company
Bagdad Copper Corporation
Duval Corporation
Inspiration Consolidated Copper Company
Kennecott Copper Corporation
Magma Copper Company
Phelps Dodge Corporation
Pima Mining Company
Tennessee Corporation - Miami Copper Division
White Pine Copper Company
Mine
Production,
Short: Tons
72,500
242,000
17,000
97,000
66,000
519,000
112,000
313,500
66,000
43,500
68,000
SOURCE: American Bureau of Metal Statistics, Yearbook 1970
11-32
-------
TABLE II-7
UNITED STATES MINE PRODUCTION OF RECOVERABLE COPPER BY MAJOR
PRODUCING STATES: 1968, 1969, 1970
(Short Tons)

State
Arizona
Michigan
Montana
Nevada
New Mexico
Utah
Other
Total
1968

Amount
631,300
74,590
64,862
72,870
92,300
228,300
34,708
1,199,290

Rank
1
4
6
5
3
2
—

Per-
cent
53
6
5
6
8
19
3
100
1969

Amount
801,363
75,226
103,314
104,924
119,956
296,699
43,097

Rank
1
6
5
4
3
2
—
Per-
cent
52
5
7
7
8
19
3
1,544,579
1970

Amount
910,000
69,500
123,031
101,000
165,260
295,000
42,059

Rank
1
6
4
5
3
2
~"
Per-
cent
53
4
7
6
10
17
3
1,705,850
SOURCE: United States Department of Interior, Bureau of Mines
11-33
-------
TABLE II-8
MAJOR COPPER MINES AND MILLS
Company

Kennecott:
Utah Copper Div.
Ray Mines Div.
Chino
Nevada Mines

Phelps Dodge:
Morenci
New Cornelia
Copper Queen
Tyrone

Magma Copper Co.:
San Manuel
Superior Div.

Anaconda Co.:
Twin Buttes
Berkeley Pit
Butte - U.G.
Yerington

White Pine Copper:

Pima Mining Co.;

Inspiration:
Christmas

American Smelting:
Mission
Silver Bell

Duval:
Mineral Park
Esperanza
Sierrita
Battle Mtn.

Bagdad:

Cities Service;
Copper Cities
Copperhill
Location Tons Ore in 1970 Employment
Utah
Arizona
New Mexico
Nevada
Arizona
Arizona
Arizona
New Mexico
Arizona
Arizona
Arizona
Montana
Montana
Nevada

Michigan

Arizona

Arizona
Arizona
Arizona
Arizona
Arizona
Arizona
Arizona
Nevada

Arizona
Arizona
Tennessee
40,147,500
12,432,192
8,276,276
7,698,883
19,172,647
10,560,000
4,800,000
9,147,500
14,000,000
450,000
8,762,000
18,850,800
543,125
9,122,000

7,635,192

14,597,803

9,377,000
1,829,000
8,038,900
3,787,700
5,871,721
5,508,742
14,318,125
1,636,457

2,100,000
4,970,196
1,677,142
6,000*
2,000*
1,200*
1,480*
2,445*
1,300*
1,700
490
3,700*
1,100*
1,000

3,000
450

3,015*

834

2,000*
275
675
385
411
492
1,205
294

525
1,900*
*Includes smelter employment.

SOURCE: ADL Estimates - E/MJ Directory, 1971
11-34
-------
b. Smelting

Traditionally the smelters have been situated near the mines in order
to minimize transportation charges for concentrates. With the major copper
mines centered in the Western States, most of the smelting capacity is in
that area. The number of smelters has declined from 20 in 1960 to 15 today,
13 of them west of the Mississippi. The thirteen western smelters are
operated by six companies—Kennecott, Phelps Dodge, Anaconda, Inspiration
and Newmont—who mine a major portion of their respective smelter input,
and by Asarco—a major portion of whose input comes from ores mined by other
companies.

The ownership of the primary copper smelters, and the approximate
capacity of each plant (in tons of charge) in 1972 are shown in Table II-9.
Of these only the White Pine smelter in Michigan treats low sulfur copper ore.

The approximate flow of sulfide flotation concentrates between mines
and smelters is shown in Table 11-10 based on information available in 1971-
1972. The flow of concentrates can vary from year to year in the case of
custom smelters, since the mine can change from one smelter to another when
a better contract is obtained. For example, Pima has switched from Asarco
to Phelps Dodge's Douglas smelter in recent years.

c. Refining

The major portion of the smelter output of blister copper is electro-
refined. Copper electrolytic refineries have traditionally been located
near the consumers on the Atlantic Coast, but several refineries have been
built in the west. The east coast refineries still account for a major
portion—about half—of electrorefining capacity. A smaller portion of
smelter output is fire refined—principally in New Mexico and Michigan.
The primary copper refineries, their ownership and the location, type and
capacity of each refinery are shown in Table 11-11. Figure II-3 shows
the location of the smelters and refineries.

D. FINANCIAL PROFILES

As developed earlier in Section B, the primary copper, lead and zinc
industries are mutually interdependent to a considerable extent. Also,
several major companies are involved in the production of all three metals.
Because of this, these nonferrous industries have been treated as a group
in Appendix A.
11-35
-------
TABLE II-9
COPPER SMELTING WORKS OF UNITED STATES—1972
Company
Location
American Smelting & Refining Co.
American Smelting & Refining Co.
American Smelting & Refining Co.
Anaconda Company
Cities Service Company:
Copperhill Operations
Inspiration Consolidated Copper Co. Miami, Ariz.
Magma Copper Company:
San Manuel Division
Kennecott Copper Corporation:
Nevada Mines Division
Chino Mines Division
Ray Mines Division
Utah Copper Division
Phelps Dodge Corporation:
Douglas Smelter
Morenci Branch
New Cornelia Branch
White Pine Copper Company
El Paso, Texas
Hayden, Ariz.
Tacoma, Wash.
Anaconda, Mont.

Copperhill, Tenn.
San Manuel, Ariz.

McGill, Nev.
(2)
Hurley, N.M. '
Hayden, Ariz.
Garfield, Utah

Douglas, Ariz.
Morenci, Ariz.
Ajo, Ariz.
White Pine, Mich.
(1)
(2)
ADL Estimates
Produces fire-refined copper as well as blister
*
Not available separately; included in Table II-8
SOURCE: American Bureau of Metal Statistics Yearbook,
ADL Estimates
Approximate Capacity
Tons of Copper
Per Year(l)
100,000
180,000
100,000
210,000

15,000
150,000

200,000

70,000
88,000
90,000
260,000

'142,000
190,000
70,000
85,000
Number of
Employees
900
450
1,000
1,558

200
*
839
*
*
550
*
*
1972
-------
TABLE 11-10
APPROXIMATE FLOW OF CONCENTRATES BETWEEN COPPER MINES AND SMELTERS

SMELTERS
MINES
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-------
TABLE 11-11
UNITED STATES COPPER REFINERY CAPACITY
[Annual Capacity at End of 1972 in Short Tons]
Company
Electrolytic;
The Anaconda Company
The Anaconda Company

Asarco
Asarco
Asarco
Inspiration Consolidated Copper
Kennecott Copper Corp.
Kennecott Refining Corp.

Magma Copper Cb.
Phelps Dodge Refining Corp.
Phelps Dodge Refining Corp.

Lake and Fire-Refining;
Kennecott Copper Corp.
Phelps Dodge Refining Corp.
White Pine Copper Co.
Location

Great Falls, MT
Raritan, Perth
Amboy, NJ
Baltimore, MD
Perth Amboy, NJ
Tacoma, Wash.
Inspiration, AZ
Garfield, UT
Anne Arundel
County, MD
San Manuel, AZ
El Paso, TX
Laurel Hill,
Maspath, NY
Hurley, NM
El Paso, TX (a)
White Pine, MT
Annual Capacity,
Tons of Material
180,000

115,000
312,000
168,000
150,000
72,000
260,000

276,000
200,000
445,000

74,000
103,000
25,000
90,000
(a)
From Morenci ores
SOURCE: ABMS Yearbook, 1972 - ADL Estimates
11-38
-------
— REFINERIES

^ SMELTERS
-------
E. PRICE EFFECTS

1. Determination of Prices

Currently, refined copper in the United States is consumed at an annual
rate of about two million short tons. About two-thirds of this metal is
derived from domestic ores and sold by the major producers at the so-called
producer price. The remainder comes essentially from four sources: (1) refined
imports of copper; (2) imports of blister for processing in U.S. refineries;
(3) toll refining of concentrate from some of the smaller domestic mines;
and (4) scrap.

The imports depend on foreign sellers being able to realize a netback
at least equal to that available outside the United States; i.e., to remain
in the United States, it must be sold at the world price. In practice,
much of the refined copper produced from such imported material is subsequently
reexported. Thus, although the domestic producer price does not apply to
all sales of refined metal in the domestic market, it does cover the greater
part.

Shortly after World War II, the practice of having a uniform delivered
price to all consuming destinations within the continental United States
came into being. Until recently, the quoted price applied to wire bars,
ingots and ingot bars, with cathodes available at a modest discount, indicating
the absence of melting and casting costs. Cakes and billets sell at premiums
to cover additional casting costs. However, two major producers now refer
to their cathode price as representing the standard quotation for copper;
they also quote a price for wire bars, but as yet the differential over
cathodes has not been standardized and some time will probably elapse before
a uniform procedure is adopted by most sellers.

Typically, U.S. copper producers sell on the basis of the price prevail-
ing on the date of shipment, regardless of when the buyer placed his order.
However, not all producers follow this practice; some sell at the average
for the month of shipment as quoted in Engineering and Mining Journal or
some other publication. In addition, some sales are made at a firm price
(usually that prevailing at the time of sale), particularly to fabricators
who prefer this method of fixing the cost of raw material rather than to
operate in the hedge market, to protect their profit margin.

The basic reason behind the use of the domestic producer price is to
minimize price changes which are considered undesirable because users want
to know what their raw material costs will be. The wide fluctuations in
copper price in markets outside the United States and on commodity exchanges
are believed to have encouraged the substitution of other materials for
copper—notably the use of aluminum, plastics, and stainless steel. At
11-40
-------
times the U.S. government has interceded in copper pricing*—notably during
World War II and the Korean War when price ceilings were placed on copper
as well as other metals and again during the Vietnam War when President Johnson,
in the fall of 1965, virtually forced domestic producers to rescind a 2c
price advance to 38c/lb, even though prices on the London Metal Exchange at
the time were over 60
-------
II II I I
1910 1920 1930 1940 1950 1960 1970 1975
YEAR

SOURCE: E/MJ March 1974

FIGURE II-4

AVERAGE ANNUAL U.S. COPPER PRICES (F.O.B. REFINERY)
11-42
-------
2. Costs of Production*

An important aspect of the primary copper, lead and zinc industries is
that traditionally the cost of smelting and refining has been small compared
to the price of copper, and furthermore, these operations have been operated
at a fixed and relatively low profit margin which is not very sensitive to
the price of the finished product. As a result, the value of the contained
metal in a typical concentrate is a high proportion of the value of the primary
metal product. This, in turn, means that the smelting and refining plants are
operated mainly as service operations in the conversion of these concentrates
to usable metal and alloys. Hence, any changes in price of the primary metal
have to be reflected back to the mine and affect directly the value of the
concentrate.

We illustrate this mechanism based on data from the copper industry but
a similar mechanism occurs in the lead and zinc industries. In the 60's, the
traditional rule-of-thumb in determining concentrate value in the copper
industry has been to assume 4
-------
In the case of producers integrated from mining through smelting and
refining, a cathode or wirebar is the first product that is actually sold.
However, the internal transfer price of the concentrates is usually cal-
culated on the basis of the primary metal price. Thus, any fluctuations
in the primary metal price are again reflected back to the mine and have
a major influence on mine profitability.*

Figure II-5 illustrates this mechanism qualitatively. The figure is
based on actual custom smelting contracts that were in effect several years
ago. It can be seen that any change in wirebar price affects the concen-
trate value directly and the smelter and refinery margins remain unchanged.

Identical mechanisms operate in the lead-zinc industries and any
increases in smelting costs would have to be reflected back to the mines.
The smelter operating margin in the lead industry varies greatly because
of the significant by-produce values passing through the western lead
smelters and was very approximately 4-6c/lb of lead in 1972, and that in
the zinc industry was about 8-10c/lb. Custom smelters in the lead industry
account for a much larger portion of domestic smelter production as com-
pared to the copper industry and a significant portion of the smelter feed
is imported. Hence, factors increasing the smelting costs would affect
the competitive position of U.S. custom lead smelters for purchasing con-
centrates in an international market.

In the domestic zinc industry, a cost-price squeeze and prospects for
increasing operating costs in the future have already led to smelter shut-
downs and an almost 60% decrease in domestic smelter capacity. Before
1964, the U.S. smelters operated on about half domestic, half imported
concentrates and exported zinc. Between 1964 and 1970, while concentrate
imports did not change significantly, the domestic demand increased to
about the same level as smelter production. The smelter shutdowns since
1970 mean that the U.S. smelter capacity is barely adequate for smelting
domestic mine production and that the U.S. will have to import a large
portion of its demand for zinc in the higher value forms such as primary
metal or finished products.
*Internal Revenue Code regulations governing the calculation of the
depletion allowance from mining operations are involved here, e.g.,
a provision for cost/profit allocation when there is no established
field or market price for captive concentrates shipped from an area
to a company's smelter.
11-44
-------
1500
1400
1300
I 1200

co
•§
.£ 1100
ro
4-*

I
"o 1000
o
900
0)
a.
cq
800
700
600
500
Refinery
Operating
Margin
Smelter
Operating
Margin
I
I
50
30 40

LME* Wirebar Copper Price (U.S. i Per Lb)

* (London Metal Exchange)
60
Source: Arthur D. Little, Inc.
FIGURE II-5
DIAGRAMMATIC REPRESENTATION OF VARIATION IN CONCENTRATE
VALUE WITH CHANGES IN WIREBAR PRICE
70
11-45
-------
F. ASSESSMENT OF ECONOMIC IMPACT

The purpose of this analysis is to assess the economic impact of the
guidelines set forth by the Effluent Guideline Development Document for the
primary copper smelting and refining industry. These guidelines are:

1. Best Practicable Control Technology (BPT) - to be met by
industrial dischargers by 1977.

2. Best Available Control Technology (BAT) - to be met by 1983.

3. New Source Performance Standards (NSPS) - to be applied to all
new facilities (that discharge directly to navigable waters)
constructed after the promulgation of these guidelines.

For the purpose of recommending effluent guidelines, the Development
Document has divided the primary copper smelting and refining industry into
two major categories based on type of operation. These categories are:

1. Primary copper smelting operations—this also includes those
operations which have associated electrolytic refineries.

2. Primary copper refinery operations which are not on the same
on-site location with a primary copper smelter.

The second category above is further divided into two subcategories
on the basis of geographical location: 1) operations located in net
evaporation areas and 2) operations located in net precipitation areas.

1. Effluent Guidelines

a. Primary Copper Smelters

For the primary smelting subcategory listed above, the recommended
effluent limitation for all three levels of control (BPT, BAT and NSPS) is
no discharge of process waste water pollutants to navigable waters. Since
some primary copper smelters are geographically located in areas of heavy
rainfall, the Development Document has allowed the following discharge
provisions to the above recommended limitations:

During any calendar month, there may be discharged from a process
waste water impoundment either a volume of process waste water
equal to the difference between the precipitation for that month
that falls within the impoundment and the evaporation within the
impoundment for that month, or, if greater, a volume of process
waste water equal to the difference between the mean precipitation
for that month that falls within the impoundment and the mean
evaporation for that month as established by the National Climatic
Center, National Oceanic and Atmospheric Administration, for the
area in which such impoundment is located (or as otherwise deter-
mined if no monthly data have been established by the National
Climatic Center).

The Development Document requires that any process waste water discharged
pursuant to the above paragraphs shall meet the water quality standards pre-
sented in Table 11-12. According to the Development Document, the 30-day
average values are based on those levels achievable with a combination of
lime and settle technologies.

There is some question as to how this quantity of water would be
measured, i.e., on a daily basis or at the end of the month. It would not
be feasible to impound all the rainwater until the end of the month when the
allowable discharge could be calculated.

b. Primary Copper Refineries Located in Net Evaporation Areas

The recommended effluent limitations for plants in this subcategory
are identical to those described above for the primary copper smelting sub-
category.

c. Primary Copper Refineries Located in Net Precipitation Areas

Those primary copper refineries not located on-site with a smelter and
which are also located in areas of net precipitation are to meet the BPT
effluent limitations shown in Table 11-13. They are also required^to comply
with the BAT and NSPS effluent limitations presented in Table 11-14. The
30-day average emission limitations shown in Tables 11-13 and 11-14 are
based on discharges of 480 and 48 gallons of water, respectively, per ton
of copper produced and on the pollutant concentrations listed below:

Concentration
Parameter (mg/1)

Total Suspended Solids 25
Arsenic 10
Zinc 10
Selenium 5
Copper 0.25
Oil and Grease 10
11-47
-------
TABLE 11-12
RECOMMENDED EFFLUENT GUIDELINES FOR EXCESS RAINWATER DISCHARGE-

ALL PRIMARY COPPER SMELTERS AND THOSE REFINERIES LOCATED IN

NET EVAPORATION AREAS
Parameter

Total Suspended Solids

Arsenic

Cadmium

Iron

Lead

Nickel

Selenium

Zinc

PH
Maximum for
Any One Day
(mg/1)

0.5

1.0

0.5

10
Average of Daily
Values for 30
Consecutive Days
Shall Not Exceed
(mg/1)

0.25

0.5

0.25

5
7.0-10.5
SOURCE: Effluent P"ideline Development Document
11-48
-------
TABLE 11-13

BPT RECOMMENDED EFFLUENT GUIDELINES —
PRIMARY COPPER REFINING—NET PRECIPITATION AREAS

Average of Daily
Values for 30
Maximum for Consecutive Days
Parameter Any One Day Shall Not Exceed
(Ib'/lOOO Ib product)

Total Suspended Solids 0.10 0.05

Arsenic 0.04 0.02

Zinc 0.04 0.02

Selenium 0.02 0.01

Copper 0.001 0.0005

Oil and Grease 0.04 0.02

pH 7.0-10.0
SOURCE: Effluent Guideline Development Document
11-49
-------
TABLE 11-14
BAT AND NSPS RECOMMENDED EFFLUENT GUIDELINES —

PRIMARY COPPER REFINING—NET PRECIPITATION AREAS
Parameter

Total Suspended Solids

Arsenic

Zinc

Selenium

Copper

Oil and Grease

PH
Maximum for
Any One Day
Average of Daily
Values for 30
Consecutive Days
Shall Not Exceed
(lb/1000 Ib product)

0.01 0.005

0.004 0.002

0.002 0.001

0.0001 0.00005

0.004 0.002

7.0-10.0
SOURCE: Effluent Guideline Development Document
11-50
-------
According to the Development Document, the above concentrations are
based on a composite taken from several plants using a combination of
neutralization and clarification for treatment of their process waste
waters. Therefore, this combination of treatment technologies forms the
basis for the BPT, BAT, and NSPS recommended effluent limitations for those
primary copper refining facilities located in areas of net precipitation.

2. Industry Segmentation

For purposes of the econonic impact analysis, we have divided the
primary copper smelting and refining industry into three segments as follows:

• No Cost

• Moderate Cost

• High Cost

The following criteria were used for placing the plants in the various
segments:

• No Cost - The plant will have negligible cost imposed by
the proposed effluent guideline.

• Moderate Cost - The plant will incur an incremental operating
cost of less than 0.5c/lb of contained copper
or an additional capital investment of up to 25%
of the plant's average annual investment or up
to 10% of the estimated 1972 net capital in place.

• High Cost - The plant's additional operating cost will be 0.5c/lb
of contained copper or greater or the added capital
investment will be 25% or more of the plant's average
annual investment or 10% or more of the estimated
1972 net capital in place.

To be placed in any one of the above segments, a plant must meet two
of the three criteria.

3. Basis for Analysis

In the following analysis, we discuss the possible impact of the
effluent guidelines from the following viewpoints:

• Price effects and plant shutdown probabilities

• Financial effects - corporate impact

• Production effects

• Balance of payments

• Employment and community effects

11-51
-------
In general, the capital and operating costs to achieve pollution abate-
ment would not be incurred by the companies in the absence of pollution
abatement regulation, i.e., they cannot be Justified on the basis of conven-
tional return-on-investment criteria. In plant-by-plant and company-by-company
analysis of pollution abatement impact, two viewpoints have to be considered.
The availability of capital for pollution abatement equipment at each plant
has to be viewed from the standpoint of the resources available to the entire
corporation. However, the justification for spending this capital at a
particular plant would result from a study of that particular plant's eco-
nomics which would take into account alternatives such as cost of production
from a refitted plant, shifting production to other plants, and most impor-
tant, the probability that this particular plant will remain a profitable
entity.

In an impact analysis, prediction of plant shutdowns is difficult since
such a decision is based on a wide variety of factors as noted above. On
the other hand, independent analysis of what a proposed venture or program
of expenditures might do to the firm in the eyes of the financial community
can be undertaken with more confidence by securities analysts and investment
bankers, for there are usually somewhat analogous situations from which to
draw inferences and because such inferences can be drawn from data of the
kind generally supplied to such individuals and organizations and to the
SEC.

In general, we would assume that a large industrial corporation which
is clearly viable, profitable, and is acknowledged to have strong managerial
and technical resources, will have access to substantial capital—in the
form of debt or equity or both, plus pollution control bonds as a source
of "off the balance sheet" financing.

In the following approach, the complete impact analysis for each
effluent guideline will be discussed before considering the next guideline.

4. Best Practicable Control Technology

a. Costs of Control

The costs for the primary copper smelting and refining industry to
meet the BPT effluent limitations were provided by EPA in the Development
Document and are presented in Table 11-15. The original costs from the
Development Document were in 1971 dollars. These were converted to 1972
dollars for purposes of the economic impact analysis since the most recent
and meaningful information available on company financial performance and
on plant production is for 1972.

b. Segments

Table 11-16 presents the estimated investment and operating costs
required to meet the proposed BPT effluent guidelines, summarized by
industry segment. Shown in Table 11-17 for the moderate cost segment is
11-52
-------
TABLE 11-15
ESTIMATED INVESTMENT AND OPERATING COSTS FOR BPT EFFLUENT GUIDELINES—
PRIMARY COPPER SMELTING AND REFINING INDUSTRY
Plant
100
101
102
103
104
105
106
107
108
109
110
111
112
113
114
115
116
117
118
119
120
121
(Thousand Dollars)
1971
Capital
Investment
0
0
0
410
51
7
0
0
0
0
410
0
334
0
0
0
20
0
254
0
0
60
Dollars
Annual
Operating
. Cost
0
0
0
86
10
2
0
0
0
0
103
0
83
0
0
0
5
0
53
0
0
60
1972
Capital
Investment
0
0
0
426
53
8
0
0
0
0
426
0
346
0
0
0
22
0
264
0
0
62
Dollars
Annual
Operating
Cost
0
0
0
89
11
2
0
0
0
0
107
0
86
0
0
0
6
0
55
0
0
62
SOURCE: Effluent Guideline Development Document
11-53
-------
TABLE 11-16
ESTIMATED INVESTMENT AND
OPERATING COSTS BY
EFFLUENT GUIDELINES —PRIMARY COPPER SMELTING

Segment and Plant Code
Moderate Cost
103
104
105
110
112
116
118
121
Sub-totals
No Cost
100
101
102
106
107
108
109
111
113
114
115
117
119
120
Totals
1972 DOLLARS
(Thousand Dollars)
Capital Investment
426
53
8
426
346
22
264
62
1,607
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1,607
INDUSTRY SEGMENT FOR BPT
AND REFINING INDUSTRY—

Annual Operating Cost
89
11
2
107
86
6
55
62
418
0
0
0
0
0
0
0
0
0
0
0
0
0
0
418
SOURCE: Effluent Guideline Development Document

11-54
-------
TABLE 11-17

RELATED INFORMATION ON COSTS FOR MEETING THE BPT EFFLUENT GUIDELINES-

PRIMARY COPPER SMELTING AND REFINING INDUSTRY
Moderate Cost
Item Segment

Added investment as a percentage of
average annual plant Investment* 3

Added investment as a percentage of
1972 net capital in place 1

Increase in annual operating cost

$/ton of copper 0.60

C/lb of copper 0.03
* Assuming total impact taken in one year
SOURCE: Arthur D. Little, Inc., estimates
11-55
-------
the added capital investment as a percentage of the average annual plant
investment and as a percentage of the estimated 1972 net capital in place.
Also shown is the increase in operating costs due to the BPT requirement
in dollars per ton and in cents per pound of copper produced. The informa-
tion presented in Table 11-18 is consolidated as much as possible to prevent
the identification of single plants. There is no need to include the "high
cost" and "no cost" segments in this table for obvious reasons.

Table 19 gives the annual copper capacity and employment, respectively,
for each segment.

c. Price Effects

As mentioned earlier, the typical operating cost for the smelting and
refining of primary copper was about 10c/lb of copper produced in 1972.
Therefore, the increased annual operating cost of 0.03c/lb of copper for
the moderate cost segment is equivalent to an increase of 0.3% above the
base operating cost. This increased cost could be either passed on or
absorbed under normal circumstances. Even if the cost cannot be passed on,
the magnitude of this cost is such that there should only be a minimal
effect on the moderate cost segment.

d. Financial Effects

As shown in Table 11-18, the added capital investment required for the
moderate cost segment due to the BPT effluent limitations is only 3% of the
average annual plant investment and only 1% of the estimated 1972 net
capital in place. In addition, this analysis is made with the assumption
that the capital investment for pollution control is totally committed in
one year. However, in actuality, the investment will be made over a period
of several years, thus, making the true financial effect less severe than
that shown in Table 11-18.

e. Other Effects

Consideration of price effects and financial effects indicates that
there will be no plant closures or production curtailments in the primary
copper smelting and refining industry due to the BPT effluent limitations.
As a result, there will be no resultant effects due to the BPT requirements
on such things as production, balance of payments, and employment in this
industry.

5. Best Available Control Technology

a. Costs of Control

The costs for the primary copper smelting and refining industry to
meet the BAT effluent limitations were provided by EPA in the Development
Document and are presented in Table 11-20. The original costs from the
Development Document were in 1971 dollars. These were converted to 1972
11-56
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TABLE 11-18
ANNUAL SMELTING AND REFINING CAPACITY OF PRIMARY COPPER AND PERCENTS
OF TOTAL INDUSTRY REPRESENTED BY EACH SEGMENT, 1972 —
BPT EFFLUENT GUIDELINES

Segment
Moderate Cost
No Cost
Totals
(Thousands
of Short
Smelting Percent
Capacity of Industry
712
1,238
1,950
37
63
100
Tons)
Refining
Capacity
682
1.570
2,252

Percent
of Industry
30
70
100
SOURCE: Arthur D. Little, Inc., estimates
11-57
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TABLE 11-19

EMPLOYMENT AND PERCENT OF TOTAL INDUSTRY FOR EACH SEGMENT-
PRIMARY COPPER SMELTING AND REFINING INDUSTRY. 1972—
BPT EFFLUENT GUIDELINES
Segment Employment Percent of Industry
Moderate Cost 13,830 42
No Cost 18.944 _58
Totals 32,774 100
SOURCE: Arthur D. Little, Inc., estimates
11-58
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TABLE 11-20
ESTIMATED INVESTMENT AND OPERATING COSTS FOR BAT EFFLUENT GUIDELINES—
PRIMARY COPPER SMELTING AND REFINING INDUSTRY
(Thousand Dollars)
Plant
100
101
102
103
104
105
106
107
108
109
110
111
112
113
114
115
116
117
118
119
120
121
1971
Capital
Investment
0
0
0
410
51
7
0
0
0
0
410
0
334
0
0
0
594
0
254
696
0
371
Dollars
Annual
Operating
Cost
0
0
0
86
10
2
0
0
0
0
103
0
83
0
0
0
288
0
53
332
0
250
1972
Capital
Investment
0
0
0
426
53
8
0
0
0
0
426
0
346
0
0
0
617
0
264
722
0
385
Dollars
Annual
Operating
Cost
0
0
0
89
11
2
0
0
0
0
107
0
86
0
0
0
299
0
55
345
0
259
SOURCE: Effluent Guideline Development Document
H-59
-------
dollars for purposes of the economic impact analysis since the most recent
and meaningful information available on company financial performance and
on plant production is for 1972.

The costs presented in Table 11-20 represent the total costs required
for complying with the BAT recommendations and not the incremental costs
over those required for the BPTteffluent limitations. Therefore, in some
instances, the costs will be identical for the two cases. For this reason,
the incremental BAT costs are also shown separately in this table.

b. Segments

Table 11-21 presents the estimated investment and operating costs
required to meet the proposed BAT effluent guidelines, summarized by
industry segment. Shown in Table 11-22 for the moderate cost segment is
the added capital investment as a percentage of the average annual plant
investment and as a percentage of the estimated 1972 net capital in place.
Also shown is the increase in operating cost due to the BAT requirements
in dollars per ton and in cents per pound of copper produced. The informa-
tion contained in Table 11-22 is consolidated as much as possible to prevent
the identification of single plants. All information is presented on the
basis of total BAT cost and incremental cost above BPT. There is no need
to include the "high cost" and "no cost" segments in this table for obvious
reasons.

Tables 11-23 and 11-24 give the annual copper capacity and employment,
respectively, for each segment.

c. Price Effects

The increased annual operating cost shown in Table 11-22 for the
moderate cost segment is equivalent to an increase of up to 0.7% above the
1972 base smelting and refining cost of 10(?/lb of copper. This increased
cost could be either passed on or absorbed under normal circumstances.
Even if the cost cannot be passed on, the magnitude of this cost is such
that there should only be a minimal effect on this segment.

d. Financial Effects

The added capital investment due to the BAT requirements for the
moderate cost segment represents only a small fraction of the average
annual plant investment and the estimated 1972 net capital in place (see
Table 11-22). This analysis is made with the assumption that the capital
investment for water pollution control is totally committed in one year.
However, in actuality, the investment will be made over a period of several
years, thus, making the true financial effect less severe than that shown
in Table 11-22.
11-60
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TABLE 11-21
ESTIMATED INVESTMENT AND
OPERATING COSTS BY
EFFLUENT GUIDELINES—PRIMARY COPPER SMELTING

1972
DOLLARS
INDUSTRY
SEGMENT FOR BAT
AND REFINING INDUSTRY—

(Thousand Dollars)
Segment and Plant Code
Moderate Cost
103
104
105
110
112
116
118
119
121
Sub-totals
No Cost
100
101
102
106
107
108
109
111
113
114
115
117
120
Totals
Capital
Total
BAT
426
53
8
426
346
617
264
722
385
3,247
0
0
0
0
0
0
0
0
0
0
0
0
0
3,247
Investment
Incremental
Above BPT
0
0
0
0
0
0
242
458
323
1,023
0
0
0
0
0
0
0
0
0
0
0
0
0
1,023
Annual
Total
BAT
89
11
2
107
86
299
55
345
259
1,253
0
0
0
0
0
0
0
0
0
0
0
0
0
1,253
Operating Cost
Incremental
Above BPT
0
0
0
0
0
0
49
290
197
636
0
0
0
0
0
0
0
0
0
0
0
0
0
636
SOURCE: Effluent Guideline Development Document

11-61
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TABLE 11-22
RELATED INFORMATION ON COSTS FOR MEETING THE BAT EFFLUENT GUIDELINES—
PRIMARY COPPER SMELTING AND REFINING INDUSTRY
Item

Added investment as a percentage of
average annual plant investment*

Added investment as a percentage of
1972 net capital in place

Increase in annual operating cost
$/ton of copper
C/lb of copper
Total
Moderate Cost
Segment
Segment with In-
cremental Cost
Above BPT
1.30
0.07
1.20
0.06
* Assuming total impact taken in one year
SOURCE: Arthur D. Little, Inc., estimates
11-62
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TABLE 11-23
ANNUAL SMELTING AND REFINING CAPACITY OF PRIMARY COPPER AND PERCENT OF
TOTAL INDUSTRY REPRESENTED BY EACH SEGMENT. 1972—
BAT EFFLUENT GUIDELINES
A. BREAKDOWN
Segment
Moderate Cost
No Cost
Totals
B . BREAKDOWN
Segment
Moderate Cost
No Cost
Totals
(Thousand of Short Tons)
BASED ON TOTAL BAT COST
Smelting
Capacity
712
1,238
Percent
of Industry
37
63
1,950 100
BASED ON INCREMENTAL COSTS ABOVE
Smelting
Capacity
NA
NA
1,950
Percent
of Industry
NA
NA
100
Refining
Capacity
958
1,294
2,252
BPT
Refining
Capacity
530
1,722
2,252
Percent
of Industry
43
57
100
Percent
of Industry
24
76
100
SOURCE: Arthur D. Little, Inc., estimates
11-63
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TABLE 11-24

EMPLOYMENT AND PERCENT OF TOTAL INDUSTRY FOR EACH SEGMENT-
PRIMARY COPPER SMELTING AND REFINING INDUSTRY. 1972—
BAT EFFLUENT GUIDELINES
A. BREAKDOWN BASED ON TOTAL BAT COST
Segment Employment Percent of Industry
Moderate Cost 14,611 45
No Cost 18.163 _55
Totals 32,774 100

B. BREAKDOWN BASED ON INCREMENTAL COSTS ABOVE BPT
Segment Employment Percent of Industry
Moderate Cost 1,988 6
No Cost 30.786 94
Totals 32,774 100
SOURCE: Effluent Guideline Development Document
11-64
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e. Other Effects

Consideration of price effects and financial effects indicates that
there will be no plant closures or production curtailments in the moderate
cost segment of the primary copper smelting and refining industry due to
the BAT effluent guidelines. As a result, there will be no resultant effects
due to the BAT requirements on such things as production, balance of payments,
and employment in this segment.

6. New Source Performance Standards

a. Costs of Control

There were no cost estimates provided by the Effluent Guideline
Development Document for the NSPS analysis. Therefore, any statements
made with regard to the effect of -the NSPS requirement on the construction
of new plants within the U.S. must necessarily be qualitative.

However, it can be said with some degree of confidence that the costs
for a "grass roots" plant to meet the NSPS standards are no more than the
costs for an existing plant in the moderate cost segment to meet the BPT
and BAT recommended effluent limitations. This is due to the fact that in
the construction of a new plant, in-process modifications can oftentimes
be made which may be more efficient and economical than add-on treatment
technologies for existing plants.

b. Construction of New Plants

For the above reasons, a new plant designed with the NSPS effluent
limitations in mind could be constructed without much difficulty. There-
fore, the cost of water pollution control due to the NSPS standards alone
will have minimal effect on the decision of the U.S. primary copper smelting
and refining industry to expand domestic production capacity through the
construction of new plants.

G. LIMITS OF THE ANALYSIS

1. Accuracy

As mentioned earlier, the costs provided by the Effluent Guideline
Development Document are order-of-magnitude costs and in no way can be used
as definitive engineering estimates. In using the costs developed by the
Document and presented in this study, it must be remembered that these
costs are applicable only to the degree of control proposed by the regulations
described herein and cannot be construed to apply to any other degree of
control.

Also, the economic impacts assessed in this report for the various
industry segments are a result of only those water pollution control re-
quirements and resultant costs also described herein. The assessment does
11-65
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not include the economic impacts due to such things as air pollution control,
OSHA standards, increases in the prices of fuel and raw materials, etc. In
fact, it should be noted that an economic impact results from any event that
decreases an operation's profitability. Therefore, in all probability, the
total economic impact on each segment due to all possible factors will be
more severe than that which will result from the proposed water pollution
controls. For this reason, the viability of a single plant or industry
segment cannot be determined by the effect of only one economic impact since
the cumulative impact of several small events can be severe even though
each one singly is not substantial.

2. Range of Error

The range of error for costs developed in this manner can at best be
within plus-or-minus 30%. In order to obtain more exact estimates, an
additional amount of time and money would need to be spent in developing
detailed engineering estimates.
11-66
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Part III. Primary Lead
Smelting and Refining
-------
III. PRIMARY LEAD SMELTING AND REFINING
A. INTRODUCTION

This portion of the study is aimed at supplying the Environmental
Protection Agency with background information relevant to the assessment of
the economic impact on the U.S. primary lead smelting and refining industry
of the costs of pollution abatement requirements under the Federal Water
Pollution Control Amendments of 1972 for each of the three standards under
consideration:

1. Proposed Best Practicable Technology (BPT) - to be met by
industrial dischargers by 1977.

2. Proposed Best Available Technology (BAT) - to be met by
1983.

B. INDUSTRY DESCRIPTION*

The common lead minerals are galena (lead sulfide), cerussite (lead
carbonate), and anglesite (lead sulfate). Galena is the most abundant lead
mineral found in deposits that have been exploited in the United States.
Galena is often associated with zinc, silver, gold, and iron minerals.
However, in a few districts the ore is characterized by simple mineraliza-
tion, with lead minerals present to the virtual exclusion of other ore
minerals. A noteworthy example is southeastern Missouri.

The more important economic deposits in the United States occur either
as cavity fillings or replacements. The origin of the mineralization in
the cavity filling and replacement deposits is similar. The theory that
the mineral-bearing solutions were derived from a deep-seated igneous mass
is most widely accepted today. Examples of the cavity-filling deposit are
the San Juan, Colorado, and the Upper Mississippi Valley districts. Re-
placement deposits are classified further as follows: massive, as at
Leadville, Colorado, and Bingham and Tintic, Utah; lodes, as at Park City,
Utah, and in the Coeur d'Alene, Idaho; disseminated, as in the Tri-State
district and in southeast Missouri; and metasomatic, as represented by the
Central district, New Mexico.

1. Apparent Reserves

The Bureau of Mines evaluated the domestic lead reserves in 1964 and
estimated the measured, indicated, and inferred lead in ore to be 35 million
tons or about 31 million tons of recoverable lead. Ores with lead as the
*Based in part on "Mineral Facts and Problems", U.S. Department of Interior,
Bureau of Mines, Bulletin 650 (1970).

III-l
-------
principal metal comprise the largest reserves, and the average grade is
2.9%. The second most important source is in lead-zinc deposits with an
average ore grade of 6.8% lead and 4.6% zinc. Discovery of the new "lead
belt" in southeast Missouri has more than replenished the lead reserves of
the United States, and deep exploration in the Idaho, Utah, and Colorado
areas has provided additional reserves.

The four states ranking highest in lead reserves are Missouri, Idaho,
Colorado, and Utah. These States account for 91% of the reserves shown in
the following tabulation:

Reserves
States (million short tons)

Missouri 31.5

Arizona, Colorado, New Mexico, South Dakota,
Utah, Wyoming 1.9

Idaho, Montana, Oregon, Washington 1.6

Alaska, Arkansas, California, Kansas, Nevada,
Oklahoma, Texas .3

The reserves mentioned above were based on material that: could be
mined, processed and marketed at profit under the economic and technologi-
cal conditions prevailing at the time of the inquiry - about 1964.

The reserves at any particular mine are affected by the prevailing
economic conditions and depend on the net-backs (net profits at mine)
received by the mine. These economic inputs can be translated into a cut-
off-grade, which is the metal content of a block of ore which would produce
a predetermined net-back. Thus, any block of ore above the cut-off-grade
is mineable, while that below the cut-off-grade can be either left in place
or mined and discarded as waste. Economic factors such as long-term
increases in sales price and lower operating costs from improved technology
permit a lowering of the cut-off-grade and, consequently, an increase in
reserves and mine life. Alternately, increased costs (from pollution
abatement or otherwise) and lower prices would result in an increase in
the cut-off-grade and a decrease in reserves and mine life. Under extreme
pressures, for example when net-backs are lower than out-of-pocket costs,
the mine would have to be shut down.

2. Mining

Lead ores (and zinc) are largely produced from underground mines,
although some deposits amenable to open pit methods occur in the Tri-State
district (Oklahoma, Kansas and Missouri) and in Washington. However, almost
all of the domestic lead production results from underground mining. Under-
ground methods employing either open or supported stopes are used in most
lead mines. Underground stoping includes room-and-pillar, shrinkage, cut-
and-fill, and timbered stoping methods, with and without rock bolts.

III-2
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Continuous improvements since World War II in mechanization and
blasting practice have enabled some domestic mines to remain competitive
with foreign operations with higher grade ore and/or lower overall oper-
ating costs. Power shovels, scrapers, and mucking machines have replaced
hand loading. Transportation by motorized trains operating on heavy-gauge
tracks and trackless mining, which utilizes electric or diesel-powered
units, are in widespread usage in the lead and lead-zinc mines of Washington,
the Tri-State district, the Upper Mississippi Valley, and southeast Missouri.
Improved, lightweight percussive and rotary percussive drilling machines with
higher efficiencies and metallized explosives are used to disintegrate
the ore. Mechanization is well adapted to the high back, single-level mines
that characterize so many of the lead and lead-zinc replacement ore bodies.
Also, output in domestic lead mines has been enhanced by changes such as
improved underground lighting, improved ventilation (including air condi-
tioning), more efficient pumps, and more durable tungsten carbide drill
bits.

3. Milling

Few lead ores are rich enough in lead or low enough in deleterious
impurities to be smelted directly; consequently, the first step in the con-
version of ore into metal or compounds is the physical separation of lead
minerals from other valued ore constituents and from waste material. Simple
lead ores, such as coarsely disseminated lead or zinc-lead minerals occur-
ring with a low-specific gravity gangue, can be concentrated by heavy-media
separators, jigs, and tables after being crushed and ground in closed cir-
cuit with screens or classifiers to give properly sized feed. Bulk or
differential flotation of the slime products or of a reground middling
product completes the flowsheet. Ores of this kind are common in the mines
of the Mississippi Valley and Eastern United States, but in most instances
the ores are concentrated wholly by flotation.

Complex sulfide ores such as those of the Western United States consist
of disseminated mixtures of fine-grained lead and zinc sulfides, usually
accompanied by pyrite, copper sulfides and gold and silver in a quartz or
quartz-calcite gangue. Such ores may be complicated further by partial
oxidation of the sulfides and the presence of high-specific-gravity gangue
minerals. The usual procedure on such an ore is to crush and grind in
closed circuit with classifying equipment to a size at which the ore min-
erals are freed from the gangue minerals. When the ore minerals are inter-
locked, the usual practice is to make a bulk sulfide concentrate, followed
by regrinding and selective flotation.

Low capital and operating costs have extended the field of the sink-
float method to include pretreatment of certain ores, permitting -upgrading
of ores diluted by nonselective mining methods. However, selective flota-
tion is the general practice in all modern concentrators. Present milling
practices recover 85 to 94% of the sulfide lead and up to about 88% of the
oxidized lead. Sulfide losses consist largely of the extremely fine
particles.
III-3
-------
4. Smelting Practice

Although all the lead smelters in the U.S. are essentially based on
the same process, the western smelters employ more complicated flowsheets
because of the more complex nature of the western concentrates, complex
imported materials and their interrelationship with copper and zinc plants,
as indicated later in Table III-2. Lead sulfide flotation concentrate is
sintered to eliminate sulfur and produce a lumpy lead oxide material suit-
able for charging into the blast furnace along with coke. In the blast
furnace the lead oxide is reduced to metallic lead by reaction with carbon
i onoxide formed by partial combustion of the coke. Zinc and other materials
in the charge combine to form a slag. Cadmium, if present in the concen-
trates, is volatilized during sintering or in the blast furnace and is
recovered from flue dust. Slag and impure lead are tapped from the blast
furnace. The slag in Missouri is discarded, but is treated for zinc
recovery in a slag fuming furnace at western smelters. Western lead smel-
ters handle a variety of by-products and utilize much more complicated
flowsheets than the Missouri smelters. Some of the details of lead
smelting practice are presented below.

a. Raw Materials

The primary raw material is a lead sulfide concentrate prepared by
flotation. This is mixed with direct smelting ore rich in silica, zinc
plant residues, siliceous and limestone flux (copper-silver-lead concen-
trates in the west), and small quantities of scrap iron if necessary. The
charge is prepared by proper mixing, sizing and crushing. Recycle sinter
fines are also blended in with the charge to form the feed to the sintering
operation.

b. Sintering

The purpose of sintering is the elimination of the sulfur in the
charge and the production of dust-free lumpy charge that is suitable for
treating in a blast furnace. Sintering in the primary lead industry uses
Dwight Lloyd sintering machines which are continuous conveyors made of
grate bar pallets joined together. Most of the older machines are of the
downdraft type (currently in use only at El Paso) , while the newer ones
are of the updraft type. In downdraft machines, a feeder loads each pal-
let and the pallets are ignited by a gas flame. In updraft units a thin
layer of charge is first put down and ignited in a downdraft section after
which the second layer is charged and the regulated updraft causes the
burning zone to progress from bottom to top. The sinter is discharged at
the end of the machine as the pallets turn over and this clinker is broken
and screened. Sufficient quantity of the oversize is crushed and recycled
to control the sulfur content of the charge to the sintering machines
between 6 and 12%. This maintains temperatures during sintering to below
1400°F and prevents excessive loss of metals by volatilization and the
production of a nonporous fused sinter.

Updraft sintering machines give better sulfur elimination within a

III-4
-------
single stage operation and higher concentration of sulfur dioxide in the
off-gases. The off-gases from only updraft sintering machines have suit-
ably high sulfur dioxide concentration for autogenous manufacture of
sulfuric acid and almost all the new sinter plants utilize updraft sintering
machines.

Sulfuric acid recovered from lead smelter off-gases is often dark in
color because of the organic vapors from flotation reagents and is usually
sold at a discount.

c. Blast Furnace

The blast furnaces used in the primary lead industry are rectangular
in cross-section with sides made of water-cooled panels. The charge to
the blast furnace consists of coarse sinter with about 10-12% lump coke.
Low pressure air at ambient temperatures is blown into the blast furnace
through tuyeres along both sides.

Lead oxide in the sinter is reduced to metallic lead by carbon monox-
ide formed by the partial combustion of coke. The heat for melting the
charge is derived from the complete combustion of coke or carbon monoxide
to carbon dioxide. Under the mildly reducing conditions in the furnace,
zinc oxide is not reduced to the metal and accumulates in the slag. When
such slags contain over 8-10% zinc, they are re-treated in slag-fuming
furnaces to recover the zinc and any remaining lead. Western smelters
treat high zinc materials and require slag fuming facilities, while the
Missouri smelters do not. In modern blast furnaces the liquids from the
furnace are tapped continuously to an external settler. In the settler
the liquid separates into two layers - molten lead and a molten slag. The
lead bullion contains precious metals present in the ore and other metallic
impurities which are recovered in the refining operation. If the charge
contains sufficient number of other impurities, up to four layers of liquid
can be found, including two intermediate layers of matte and speiss, the
matte layer being predominantly copper, iron, nickel and cobalt sulfide,
while the speiss layer contains a mixture of complex copper arsenides and
antimonides. Most of the sulfur in the charge to a blast furnace leaves
the reactor with the liquid products and not with the off-gases. Cadmium
in the charge is volatilized.

Lead recoveries at primary lead smelters are usually about 97 to 99%
of the lead contained in the ore and offer a relatively small margin for
improvement. Recent modernization programs center largely on charge prep-
aration, roasting, dust collection, and material handling within the plants.
Such programs have more than doubled the productive capacity of lead blast
furnaces since 1925. Two new smelters in southeast Missouri began operating
in 1968 with full utilization of the electronic and mechanical developments
adaptable to metallurgical processing.

5. Refining

Lead bullion from smelters operating on the ores of the Mississippi

III-5
-------
Valley, termed "chemical lead," is pure enough for most commercial uses
without sophisticated refining methods. Lead bullion produced from western
and most foreign ore contains enough gold and silver to make extraction
profitable. It also contains various base-metal impurities that must be
removed before the lead is marketable for end use. The sequence of pro-
cessing for impurity removal consists of softening and desilverizing of
lead bullion. The recovery of by-products is subject to many variations
in practice.

Softening consists of the removal of copper, tin, antimony, and arsenic
in a dressing or refining kettle. The copper is removed by holding the
bullion just above the melting point and skimming copper dross from the
surface. Agitation, with addition of elemental sulfur, causes the remain-
ing copper to rise to the surface as a black copper sulfide dross, which
is skimmed off. After copper dressing, the temperature of the bullion is
raised, and the bath is agitated to induce surface oxidation. The tin,
arsenic, and antimony are oxidized, and the oxides (being insoluble in the
bath) rise to the surface with some lead oxide, which is skimmed off. The
softened bullion usually is desilverized by the Parkes process of stirring
metallic zinc into the bullion. Gold and silver, in that order, combine
with the zinc, and the resultant alloys on cooling rise to the surface and
are skimmed off as gold and silver zinc crusts. The zinc remaining in the
lead after desilverizing is removed by vacuum distillation or with caustic
by the Harris process. If bismuth above acceptable limits is present, the
bullion must be refined by the Betts electrolytic process, or by the Kroll-
Betterton process after desilverization.

6. Recent Trends in Lead Extraction

The lead smelting and refining technology has remained basically
unchanged in the last several decades and most recent lead plants, for
example, the two new plants in Missouri are still based on conventional
sintering, blast furnace smelting and fire refining. The most fundamental
development in recent years has been the Imperial smelting process which
makes it possible to produce lead and zinc from a single unit. In this
process, a bulk lead-zinc concentrate is sintered and then reduced in the
blast furnace to simultaneously recover both lead and zinc. The process
is primarily applicable for smelting mixed lead-zinc concentrates from
those lead-zinc ores in which the components cannot be completely separated
by froth flotation. The process requires coke and, reportedly, the oper-
ating costs are sensitive to the cost of coke. The three products of this
process are impure zinc metal, lead bullion containing the precious metals,
and matte. Furnaces of this type are presently operating in the United
Kingdom, Australia, Zambia, France, West Germany, Rumania, Japan, and
Canada, and several are in construction or planned throughout the world.
Theoretically, this process would be applicable only to complex ores of
the western U.S., and would be inappropriate for the relatively pure lead
ores in Missouri. We believe that the recent closing of the Imperial
Smelting plant in England from environmental considerations will influence
the adoption of this process in the developed countries. Also, the process
requires periodic shutdown for clean-up. This type of labor practice might
not be adaptable to U.S. conditions.

III-6
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Recent developments in lead smelting include a continuous tapping
method for lead blast furnaces which reduces labor requirements and improves
blast furnace efficiency. Full scale tests of oxygen enrichment of blast
furnace air have been conducted in the U.S. A direct smelting method was
developed by Arthur D. Little, Inc. for St. Joe Minerals, based on blowing
concentrates beneath the surface of a molten lead bath by means of a stream
of air. Lead sulfide reacted with air and converted to lead and 502 at a
high rate and with a high degree of completeness. This process has not
been tested beyond the pilot plant stage. The Boliden Company in Sweden
has operated an electric flash smelting process. In this method high grade
lead sulfide concentrates are mixed with fluxes and coke breeze and are
flash smelted in vertical air jets down into an electric furnace. Lead
sulfide matte from the electric furnace is converted in side-blown converters
to metallic lead. Rudniki Svinca in Yugoslavia uses a short rotary furnace
for producing lead from a self-fluxing sinter charge. The sinter is charged
periodically to a rotating furnace and lead is removed and separated from
zinc-bearing residues and slags. The slag is next smelted by adding sodium
hydroxide, sodium carbonate and some coal for reduction. The rotary furnace
is fuel or gas fired. There are several hydrometallurgical processes that
have been tried on a small scale for lead extraction, but none have been
proven on a commercial scale.

7. Water Usage in the Lead Industry

As in the copper industry, water usage in the lead industry varies
with the location of the plant, with operations in arid areas practicing
more water conservation. Figure III-l shows a generalized flowsheet of
water use in lead smelting/refining operations.

In general, the most significant use of water in lead smelting/
refining operations is for cooling water (both contact and noncontact).
The other major uses are for process water and water for air pollution
control which may be considered as a process water.

Recycle ratios tend to be high in most of the lead operations, reflec-
ting the large percent usage for cooling and the usual operation of cooling
towers and cooling water circuits.

a. Noncontact Cooling Water

Various applications of noncontact cooling water are found in primary
lead smelters. These applications include the cooling of various parts of
sintering machines and the jackets or outer shells of the blast furnace,
cooling of door frames or other portions of reverberatory furnaces (if
present), bearing cooling, and, if one is present at the plant, the coolirg
of sulfuric acid-plant reactors and other components. Other noncontact
cooling water applications may be related to power and steam plants if
they are associated with the lead smelter.
III-7
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I
CO
Cooling Tower
or Reservoir
Blast
Furnace
I so —•
Noncontact
Cooling
Water
Acid
Plant
Slowdown
Gas Cleaning
Train

(
1
Blast
Furnace
Slag
Granulation
Acid
Plant
1
Ventilation
Scrubbers
Recycle
Pond
Recycle
Reservoir
Settling
FIGURE Iir-1
GENERALIZED DIAGRAM OF WATER USES AND WASTEWATER SOURCES IN PRIMARY LEAD PLANTS
-------
b. Process Wastewater

Process wastewater streams identified with lead smelter/refinery
operations include:

1. Streams from the gas-cleaning train associated with acid-
plant operations, including water from such sources as
gas conditioning (hurfidification) chambers, electrostatic
precipitator sumps, or bleed stream from weak-acid wet
scrubbers.

2. Streams from blast furnace slag, speiss, and/or dross
granulation operations, usually a bleed or intermittent
overflow stream from a recirculating water system.

3. Water circuits for cooling of hot gases from either the
blast furnace of the sintering operations or for air
pollution control in wet scrubbers.

8. Supply and Demand

a. The World Situation

Over the past twenty years the world consumption of lead has increased
at an average annual rate of 2.5-3% per year to its present level of about
3.5 million tons per year of refined metal. The growth rate exceeded 4%
between 1960 and 1965 and has since then been slightly over 3% worldwide.

The uses of lead fall into the following six broad categories:
• Batteries

• Gasoline Additives

• Alloys and Miscellaneous
• Pipe and Sheet

• Pigments
• Cable
% Worldwide
30
11
22
11
9
17
% in U.S.
36
19
27
4
9
5
The above breakdown indicates that the usage of lead is heavily depen-
dent on the automobile industry. At the present time the use of alkyl lead
compounds as gasoline additives is under attack and this market might be
eliminated, especially in the developed countries. Lead basically has no
substitutes in its numerous alloy, pipe and sheet uses and a growing market
is represented by the construction industry.

It appears that the growth in lead consumption will be greater outside
the United States than in the United States, and consumption within the
III-9
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United States and perhaps the developed countries of Western Europe might
decline should the use of lead gasoline additives be banned.

World production of lead grew from 2.63 million tons in 1961 to 3.31
million tons in 1968, an annual growth of only 3%. U.S.S.R. took over as
world leading producer of lead ore from Australia in 1966. The latest
figures indicate nine countries produced more than 100,000 tons per year.
The output of these nine countries accounted for 70% of the lead ore
production of the world. In 1968, the communist countries accounted for
about 27% of world total, while the U.S.A. accounted for only 11%. U.S.
primary production has increased considerably since then and amounts to
about 21% of the free world primary production.

b. Situation in the United States

The United States is a major producer and the largest consumer of
lead. In 1970, for example, the figures were:

Free World U.S.A. U.S. Share
(Million Short Tons)

Mine Production 2.79 .60 21%

Refined Production 3.33 .82 25%

Refined Consumption 3.12 .89 28%

Source; S.D. Strauss, Trans. Inst. Min. Met. (London)
8JD, A169-A174 (1971)

The United States has been in a position of undersupply for years and
the recent increase in smelter capacity in the new lead belt in Missouri
will still not make the United States self-sufficient. U.S. imports of
lead have varied between 350,000 to 450,000 tons per year since 1960.
Imports in 1970 amounted to about 357,000 tons, of which 245,000 tons was
imported in the form of pig lead.

9. The Interdependence of the Copper, Lead and Zinc Industries*

Several copper mills produce a small tonnage of lead or lead-zinc
concentrates. Similarly, several lead mines and mills in Missouri produce
a copper concentrate which is shipped to a copper smelter. Lead and zinc
occur almost invariably together in the same deposit in the Western U.S.
*This section is identical in the copper, lead and zinc chapters.

111-10
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TABLE III-l
CROSS-FLOW OF MATERIALS BETWEEN PRIMARY COPPER, LEAD AND ZINC INDUSTRIES
A) Mining and Milling
B) Smelting
M
M
I
C) Refining
Source

Cu mills
Pb-Zn mills
Pb mills
Pb-Zn mills

Cu smelter
Pb smelter
Pb smelter
Pb smelter
Zn-Pb smelter
Zn horizontal
retorts
Zn electrolytic
Cu smelter
Pb smelter
Ag-Pb-Sb-Cu cone.