Oral-History:Robert S. Shoemaker
About Robert S. Shoemaker
Robert S. Shoemaker is a Consulting Metallurgist for the Mining and Metals Division of the Bechtel Corporation. After service in the U.S. Army Corps of Engineers, he attended Oregon State College where he received B.S. and M.S. degrees in inorganic chemistry in 1950 and 1951. In 1953, he received an M.S. degree in metallurgical engineering from the University of Wisconsin.
He joined the Minerals Research Department of the Union Carbide Research Laboratories in Niagara Falls, New York in 1953, and in 1956 was transferred to the Development Department of the Union Carbide Metals Company. In 1957 he was based in the Engineering Department of the Union Carbide Ore Company in New York where he was Metallurgist for numerous projects in Norway, Australia and the United States. In 1962, he joined the Bechtel Corporation in San Francisco as Supervising Engineer for Bechtel's Mining and Metals Division. In 1968 he was appointed to his present position as Consulting Metallurgist. He has participated in the design of numerous metallurgical projects throughout the world.
Mr. Shoemaker has served as a Director of the Institute. He has served as Director of the Society of Mining Engineers (SME) of AIME, as Chairman of its Program Committee and as Chairman of the Mineral Processing Division. He is also a past Chairman of the San Francisco Section of AIME. Mr. Shoemaker is a Fellow of the Institute of Mining and Metallurgy and a member of the Canadian Institute of Mining and Metallurgy and the Mining and Metallurgical Society of America.
Further Reading
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About the Interview
Robert Shoemaker: An Interview conducted by Eleanor Swent in 1999 and 2000, Regional Oral History Office, The Bancroft Library, University of California, Berkeley, 2001.
Copyright Statement
All uses of this manuscript are covered by a legal agreement between The Regents of the University of California and Robert Shoemaker dated April 5, 2001. The manuscript is thereby made available for research purposes. All literary rights in the manuscript, including the right to publish, are reserved to The Bancroft Library of the University of California, Berkeley. No part of the manuscript may be quoted for publication without the written permission of the Director of The Bancroft Library of the University of California, Berkeley.
Requests for permission to quote for publication should be addressed to the Regional Oral History Office, 486 Bancroft Library, Mail Code 6000, University of California, Berkeley 94720-6000, and should include identification of the specific passages to be quoted, anticipated use of the passages, and identification of the user. The legal agreement with Robert Shoemaker requires that he be notified of the request and allowed thirty days in which to respond. It is recommended that this oral history be cited as follows:
It is recommended that this oral history be cited as follows:
Robert Shoemaker, "Metallurgical Engineer: Union Carbide, Bechtel, San Francisco Mining Associates; Metallurgical Consultant, 1953 to 2000," an oral history conducted in 1999 and 2000 by Eleanor Swent, Regional Oral History Office, The Bancroft Library, University of California, Berkeley, 2001.
Interview Audio File
Interview
INTERVIEWEE: Robert S. Shoemaker
INTERVIEWER: Eleanor Swent
DATE: 1999
PLACE: Berkeley, California
Swent:
Let me just say first that you have already written an extensive memoir, which we're going to augment with this interview, and we already have an interview that you did in completion of the McQuiston volume, so this is a supplementary interview that we're doing now.
Shoemaker:
I thought I would talk a little bit about how I really got interested in the mining industry. This was after World War II, in the fall of 1946, when I went to college at what was then called Oregon State College, which is now Oregon State University.
Swent:
I think you covered a good deal of this in your memoir.
Shoemaker:
Yes. Well, I thought maybe I'd just give a little bit of it.
Swent:
Okay.
Shoemaker:
I was a chemistry major. My professor there was William Caldwell, who had had a degree as a mining engineer before he got his Ph.D. in chemistry, and he was still a miner at heart. He had a small mine up on an island in Puget Sound. It was a mine that contained celestite (strontium sulfate) and strontianite (strontium carbonate). But he and a friend of his by the name of Kenneth Watkins, who was a logger and a miner, got interested in the Champion Mine, which had been worked in the 1920s quite extensively. It was in the Cascade Mountains of Oregon, east of Cottage Grove, Oregon, at an altitude of 6,000 or 7,000 feet.
They had gotten ahold of a logging company that wanted to expand their timber holdings in the Cascade Mountains. It was called Bohemia Lumber Company, and it eventually became a very, very large company. In fact, they had a mill at Grass Valley. But the Bohemia Lumber Company would put up the money to help Watkins and Bill Caldwell try to rehabilitate this Champion Mine, in exchange for them filing more mining claims in that area so that the lumber company could harvest the timber. At that time, it was perfectly legal.
I was hired during the first summer vacation after I was a freshman by Bill Caldwell, who kind of took a shine to me. I was twenty-two years old at that time. I was put to work underground, along with a mining engineering student at Oregon State, which at that time had a mining engineering program. His name was Bob Tonneson. We had to clean out the main haulage way, which was the 1,200-foot level, in the bottom of the mine. That was the entrance to the mine.
Swent:
This was a mine that had been abandoned?
Shoemaker:
It was copper with some gold. During the Depression, it was shut down and never reopened. It was quite an extensive operation at one time. They had a hundred-ton mill, a hundred tons-per-day--or per-shift mill, so it would be a three-hundred-ton-a-day mill. There was a bunkhouse there, a three-story bunkhouse that was held on the side of the mountain with cables going across the road, above the bunkhouse and anchoring it to the trees, because in the wintertime the snow was so deep that the snow would have pushed the bunkhouse off of the mountain. One of the other people there was Gordon Card, who was a miner and a logger. His grandfather had owned the Card Iron Works in Denver. They made mine cars and sheave wheels for hoists in mines. They had a foundry, and they served the mining industry. The mine actually had come into the possession of a man named Bill Bartels. Bill looked a lot like and acted a lot like Major Hoople. He was bald-headed.
Swent:
Major Hoople was a comic-strip character in the thirties and forties.
Shoemaker:
That's right. A great talker and a great drinker. He did his own assaying. He used what was called an iron nail assay, and he used a track spike for the iron nail. This is a fire assay. He did a fairly good job as an assayer, but he and his--I would call him a second banana, whose name was Joe Thompson, and he was known as Little Joe--were working a winze off of the 600 level of the Champion Mine, which had an entrance on the other side of this mountain.
Little Joe [chuckles] only weighed about 125 pounds. He claimed he had been over the Chilkoot Pass [to the Yukon] in 1898. We don't know whether that was true or not, but any time he would have a drink, which was often, he would recite great stories about his experiences over the Chilkoot Pass. Obviously, it seemed like they were exaggerated. He would also recite poetry when he had quite a bit of liquor in him. One of them that we took down over a number of evenings was a parody on a Robert Service poem. It was called "The Hermit of Shark Tooth Shoals." I have that whole parody, which is very funny. As I say, they were working the 600-foot level, along with Gordon Card. Gordon Card was a young fellow about my age. Very athletic and very strong. This 600-foot level went not too far into the side of the hill. The three of them had developed a winze that went down about fifty feet, and they were mining down there this copper-gold ore, primarily for the gold. They would ship the ore to the Asarco Tacoma smelter.
During the time I was there, I would go up and see how they were doing because I was interested in the way they were mining. Gordon [chuckles], besides helping Little Joe down in the winze, was loading the skip that was pulled up by an air tugger by Bill Bartels. Bartels never really did much of the work. He was the boss. But Gordon would have to run out to the portal and pour water down into this air compressor that was as old as the hills.
It was called a Gardner-Rix compressor that was a gasoline-driven engine, a gasoline-driven compressor. The engine and the compressor shared the same crankcase, which was very, very unusual. It had iron wheels, and it had a bottomless pit as far as water in the radiator was concerned. Gordon would run out to the portal and pour water down that radiator at least every twenty, thirty minutes. If he didn't, it would freeze up and stop. The air tugger was just a three-cylinder air-driven hoist.
Doc Caldwell was writing a book on general chemistry for freshman students, along with a friend of his by the name of King, who was also a professor of chemistry but from Washington State University. They were writing on this book in the evenings. It eventually sold more copies than the book that Linus Pauling wrote. Both of them became multimillionaires from that book, which was the source of great envy to the rest of the faculty at Oregon State.
The rest of the faculty didn't like Caldwell very well anyway because all of his graduate students had to work on something for their thesis that was practical and that had a possibility of making some money for someone, whereas the rest of these professors, like most of them today, had their grad students work on research projects that are so esoteric that they might eventually end up as two or three figures in a reference book that no one reads. He was also a consultant to the lawyers that at that time were representing the fruit growers up in Oregon and Washington, and were suing the aluminum companies because of the fluorides that were being discharged into the air from the aluminum pots, electrolytic cells, in aluminum smelters, of which there were several up in that area using Bonneville [Dam] power.
In fact, when I became a graduate student under Caldwell, he took me along with him to visit a couple of these smelters and then had me do my research on the recovery of cryolite, which is the sodium-aluminum fluoride mineral, that at that time was mined mostly in Greenland and was used as the electrical conductor in the electrolytic aluminum pots. Each plant had tremendous numbers of these pots. They called them a pot, but they were more the shape of a coffin except much, much larger. They had a carbon or graphite liner in these pots that was about eight inches thick, and then there were graphite electrodes in the pots, sticking down into the molten bath. Eventually, these electrodes--both the cathode and the anode--would crack from the heat, and the molten cryolite would seep into them. Eventually, they had to be removed from the pots and thrown away. Well, they didn't throw them away. They put them in huge piles alongside of the Columbia River. There were fluorides from that draining into the Columbia River.
Shoemaker:
Anyway, as part of his, Caldwell's, expert witness testimony, he got interested in these aluminum pot liners and had me work on a system for recovering the cryolite from these waste aluminum pot liners. That was the subject of my master's thesis. That process which I developed under his direction was the basis for all of the recovery plants that were put in by all of the aluminum companies to recover this cryolite, which was quite valuable. Every aluminum company has one of these recovery plants and has had them for many years.
Swent:
Did you get any credit for it?
Shoemaker:
I didn't get any money out of it, no. Oregon State didn't get patents on things like that. I'm sure they would nowadays. But it was in the literature, and all the aluminum companies came and got copies of my thesis.
Swent:
Did you have any contact directly with the aluminum companies?
Shoemaker:
Only when I was up there visiting with a plant at Longview, Washington, and one in Troutdale, Oregon.
Swent:
As a result of your thesis.
Shoemaker:
Yes.
Swent:
They didn't try to hire you as vice president or something?
Shoemaker:
No, I wasn't ready to go to work yet. I wanted to have a Ph.D. and be a chemist, although I was still very much interested in mining, or metallurgy. But anyway, King and Caldwell, although they were writing this book, which went through many editions. in the evening--King was in charge of the survey crew that was surveying all of these new claims for Bohemia Lumber. There was about six young fellows on the survey crew, and King was the surveyor.
They went out one day, and they were surveying downhill in the mountains in western Oregon. The Cascade Mountains are very steep, and they found that coming uphill was a lot longer than going downhill, and they miscalculated their time to return back to the bunkhouse, and it got dark. King had a son who was about sixteen years old, and he was about six feet tall. He had an enormous appetite, although he was as thin as a rail. He could out-eat anybody on the whole crew up there.
Anyway, one of these fellows remembered that he had a carbide lamp in his pack that he was carrying, and some carbide. That seemed to have saved the day, but coming back up the mountain, it was so warm they had drunk up all of their water. King had the idea that each of those young fellows you might say carried their own water supply which he could use as a reagent to make acetylene with the calcium carbide. But it was so hot that not one of the six people could come up with the necessary reagent of water. So they were pretty desperate because they were going to be there all night until King's son remembered that he had an orange left over from his lunch, which was an absolute miracle because he ate not only his lunch but half of everybody else's. So King squeezed that orange into the carbide lamp and was able to make enough light so that they got finally back up to the road. We were so worried we sent out a rescue party, and we were walking down the road and met them on the road and brought them back up the hill.
I thought that invention of orange juice and carbide to make acetylene probably was one of the greatest inventions in the world and probably compared very well with Newton's discovery of gravity. I have a formula here that I made up for the calcium carbide [looking through papers] reacting with the urine and how it would produce acetylene, but unfortunately, they weren't able to give it a try because they were all too dry. CaC² + Pee [right arrow] CaPee + C²H² [up arrow] [Calcium carbide plus pee gives calcium pee plus acetylene]. And it has an arrow here at the end that goes upward, and that is acetylene, and that arrow means that it's a gas.
Swent:
And that gives you your light.
Shoemaker:
Yes. [laughter]
Swent:
Okay. So that was one summer up there, right?
Shoemaker:
Well, it wasn't all of it. When I first went up there, I went up on my motorcycle. Even though Caldwell wanted to hire me, Watkins, being the miner, had to approve of me. I went up to see Watkins, and it was raining that day. I was wearing my--what we used to call a tin suit, which was two layers of canvas with oilcloth in between. It was waterproof, and it was the usual attire for anyone who was working outdoors, like loggers and laborers of any type.
The pants on these were held up with--I had a pair of red suspenders. I found out later that the red suspenders were the reason that Watkins hired me because he had a policy of never hiring anyone who didn't wear suspenders [chuckles].
Anyway, Tonnesson and I were put to work cleaning up this long 1,200-foot drift into the mountain, the main haulage way, cleaning all the iron hydroxide that had precipitated in the ditch alongside of the track. It was a very wet mine, and it was raining all the time in there. The water was highly acid. It would eat into a pipeline like the air pipeline or a water pipeline in a matter of a day or two. Actually, the copper in the water would replace the iron in the pipeline, and it would just cause a hole in the pipe. And then we had to install a bucket--it was about three by five feet--in the shaft that went up to both the 1,050- and the 900-foot level. We were working on the 1,050-foot level, Tonneson and I, and we got it cleaned up and we got it timbered, and when it would rain occasionally up there, Watkins' son--he was on the survey crew, but he would beg off the survey crew and come into the mine and work so he wouldn't get so wet.
Anyway, we had to get everything cleaned up. Watkins came up--well, he would watch the job, but he wouldn't be there all day long. And we started mining the stope; it was a vertical vein, probably sixteen to eighteen inches wide. We were using a stoper, which is drill for drilling overhead. It had an air-operated--what was called a stinger, a rod that had a sharp point on the end of it--come out the back end of the drill so that it would push the drill upward; you didn't have to hold the drill itself. These were quite old-fashioned ones, and they weighed ninety pounds apiece.
Watkins was showing us how to use this drill, and we would put stulls--what you might call braces but they were called stulls--between the walls of the vein. We had to mine thirty inches wide to get the eighteen-inch vein rock out. Thirty inches just about gave you room to turn around in.
Watkins was standing on this stull--actually, on a two-by-ten timber that reached between a couple of stulls. He weighed about 250 pounds, and that board was sagging, along with the weight of the stoper.
He was saying, "Now, you have to be very careful because when you grip the throttle to start the drill and if the drill catches in the hole, then if you don't let go of the throttle instantly, you'll be wrapped around the stoper." The drill would turn itself. So he started the stoper, and he drilled about six inches, and the drill caught in the hole, and it happened so quickly that he went around that stoper three times, wrapped up in the air hose.
Shoemaker:
Pretty poor example! Anyway, we mined out quite a bit of that ore and shipped it to the Tacoma smelter.
Swent:
What was the year?
Shoemaker:
This was 1947.
Oh, I wanted to go back to [Bill] Bartels. I would go over and watch him run these iron nail assays in this little assay office. He had a coal-fired assay furnace. But also I would go up and watch Little Joe and Bartels and Gordon Card. I was standing at the top of the winze where Bill was operating the air tugger, pulling up the ore that Gordon loaded into the skip. Bill spent most of his time with the carbide lamp, which he would take his whole hat off to use and examine the ore to see how good it was.
While I was there, one of the skip loads had some pretty good-looking ore, and some visible gold in it, and so he called down to Little Joe to come up and take a look at this ore that he was mining. So Little Joe climbed the ladder about fifty feet, and we were looking into this ore car, and they both bent over, and Bill had his hard hat off, so he could shine the lamp directly on this piece of ore. And Little Joe leaned over to look at it, and his carbide lamp, the flame of it hit Bill Bartels right in the middle of his bald head.
There was an absolute scream. It just sounded like a wounded panther. He jumped around and swore and yelled and screamed. They finally decided that that was enough for that day, and they went back down to the cook house or the bunkhouse. Bill had this great big--looked like a robin's egg blister right in the middle of his bald head.
So they decided to go to town, go to get some medicine for that. Of course, that was the type of medicine that was applied internally rather than externally. They had an old Studebaker ex-Army six-by-six truck. It had vacuum brakes, and every time you hit the brakes hard, the engine would die. They got down the hill all right. This was very steep. It was nine miles down a very steep, winding road. They-- [tape interruption]
Shoemaker:
Well, they didn't get back to the bunkhouse, and we were finally getting worried about them because we knew they would both be drinking. Finally, Little Joe came staggering up the road and came into the bunkhouse. He was kind of scratched up and absolutely worn out. He was still considerably inebriated. He told us that somehow the truck had leaped off of the road down into the canyon. That's about all he could tell us!
We asked him about Bill, and he said, "Well, he's still down there." So we all got into another truck we had, and we went down the hill a couple of miles. This truck had gone off the road and fell over between two great big fir trees. The front bumper hit one of them, and the tailgate of the truck had fallen open and caught on this other fir tree, and the truck was lying on its side on this very steep mountain. If it hadn't been for the trees, both of those fellows would have been killed.
When we got there, Bartels was sitting on the truck. He was too big and fat to--he was sitting on the door. He had climbed out the window. He had the bottle in his hand, which miraculously hadn't gotten broken. And just as drunk as a skunk. [laughter] But really, even with those incidents, I learned an awful lot and learned to do a lot of mining, particularly metallurgy. That's where I got my interest in eventually getting a second master's degree in metallurgy.
Shoemaker:
I think we should go now to when I got out of college, after the University of Wisconsin, and I went to work for Union Carbide Research Laboratories in Niagara Falls. That was in 1953.
We were doing research on mineral processing and recovery of minerals from ores. They had established a research laboratory the year before, under the direction of Rush Spedden, who they hired from MIT. He was an instructor at MIT when they hired him. He had hired one physical metallurgist and had ordered some equipment, but the laboratory wasn't nearly set up. That was my job, to set up the laboratory and get it in shape to do research on samples that Union Carbide Ore Company's geologists had sent in.
Swent:
So this was a new enterprise on the part of Union Carbide?
Shoemaker:
Yes. They had a number of mines worldwide, but this was the first time they had got into mineral research. We worked on a great number of ore samples.
Swent:
Was this a new concept? Were other corporations doing this at the same time?
Shoemaker:
Oh, yes. Kennecott had a very expensive laboratory in Salt Lake City. Anaconda had a laboratory first in Anaconda, Montana, and then they moved it to Tucson, where they built quite a palace down there. It was the kind of the thing to do for mining companies at that time, particularly the larger ones. It seemed like most of them had research laboratories.
Swent:
Was the Bureau of Mines also doing research?
Shoemaker:
Oh, yes. They had research laboratories on minerals--Albany, Oregon; Salt Lake City, Reno, Denver, one in Missouri, one in Minnesota.
Swent:
These were all independent of universities?
Shoemaker:
That's right.
Swent:
That's interesting.
Shoemaker:
But they've gotten away from that now. I think the only mining company that has a laboratory now is Newmont. Newmont established a laboratory first up in Connecticut. Now that they've moved to Denver, they have a laboratory that's on the land that is occupied by Denver Research Institute, which is a kind of quasi-governmental, state governmental entity that does research on all kinds of things, trying to develop business.
This laboratory that we had was in an old building that had been there at the laboratory site in Niagara Falls. The main laboratory was really a physical metallurgy laboratory for the development of different alloys that Union Carbide made in their electric furnace. Anything to do with metals. They were big in the welding rod business and developing different welding rods for different materials. That was quite a nice building. There was, oh, a couple of hundred people working there.
But our minerals laboratory was the first that they had. This building had been built during the war. It had two vacuum furnaces. They were electric arc furnaces that were operated in a high vacuum. Those furnaces made the uranium metal for the first atomic bombs. They made it out of uranyl nitrate, which was shipped to them. It was made in Oak Ridge and shipped up there.
It was reduced in these electric furnaces to uranium metal. This was enriched, U-235. The floor was a concrete floor there, and the floor was radioactive. The furnaces were radioactive. They left the furnaces there because they were too radioactive, they thought, to move. But my desk was right alongside of one of these furnaces. These furnaces were probably seven or eight feet in diameter and altogether ten or twelve feet high, something like that.
They found out later, when they tore the building down, that there was this uranyl nitrate--they call it green salt because it had a green color--it was dust up in the ceiling, in between the studs in the walls--the whole thing was--today you wouldn't be allowed to even come near the place. But in those days, you didn't pay attention, really.
Swent:
You didn't take any precautions whatsoever personally?
Shoemaker:
No. They finally put down some battleship linoleum on the floor, which didn't help at all. When I was working there in the laboratory, there was a cupboard in there, and I found a gallon can of what were called fins. They had made--when they made the uranium metal, it was molten, and then they poured it into molds and made castings that were later taken to some other place and machined into the parts that went into the bomb. They made the rough castings. Any of the metal that overflowed the molds was called fins. It was either remelted or--well, it was always remelted.
But anyway, I found a gallon can and it had some of these fins in it, and there were seventeen pounds of this material, which I didn't know what it was. I sent it up to the laboratory, the X-ray laboratory, and it came back that it was U235; it was bomb-grade metal. They were supposed to have accounted for every pound of this uranium that came in there, but their accounting wasn't very good. So they finally decided--about that time, they decided to take those furnaces out of there, which they did, and took them out to our slag dump because they also had a very large ferroalloy plant there that employed about 1,500 people and made calcium carbide as well as all different types of ferroalloys. They took those furnaces out and buried them in the slag dump. That's also where that bomb-grade metal is today. As far as I know, it is. But it's not hurting anybody.
In fact, we lived right at the edge of Love Canal in a house I had bought for $17,000 with a G.I. loan. And that house, after I left there, was sold to somebody else. But then, when all the business about Love Canal came along, they closed up the house and boarded it up completely--all the houses around us. They didn't tear it down. But in the last few years they've opened up all those houses and have sold them because it turns out that, as usual, no one ever got sick from the Love Canal or from anything from the Love Canal.
Swent:
Did any of the people who worked with you at that laboratory have any ill effects from it?
Shoemaker:
No, no.
Swent:
I'm trying to think. Frank Aplan was working with you, wasn't he?
Shoemaker:
No, he came afterwards.
Swent:
Who was there with you?
Shoemaker:
Well, I was supervisor of the laboratory. That was for about two and a half years. They began--the Union Carbide development department over in the plant began borrowing me. Finally, they called me in and told me they would like to move me over there and move me out of the laboratory. That is when Rush Spedden hired Doug Fuerstenau. Doug came in and took my place.
Swent:
He's still very healthy, too.
Shoemaker:
Oh, yes. Well, he was there for I guess a couple of years, and then he went to work for Kaiser. Frank Aplan then came. He had got his Ph.D. there at MIT, where Fuerstenau had gotten his Ph.D. Spedden never got a Ph.D. I don't know why. Anyway, Aplan worked there for a while, and then they moved the mineral processing laboratory down to Tuxedo, New York, which was up on the Hudson River, north of New York City.
I went over to development because they had been borrowing me to look into materials handling problems at their various ferroalloy plants. All the people in the ferroalloy plants were furnace type metallurgists. I was an extractive metallurgist. Extractive metallurgy is 60 or 70 percent materials handling--crushing, grinding, conveying, pumping, handling materials. Almost anyplace I would go in any of these plants, I could find places that I could save the company a lot of money on the materials handling--like screening and crushing and so on.
I worked in plants in--not only the Niagara Falls plant but I worked at Marietta, Ohio; Ashtabula, Ohio; and Alloy, West Virginia; and Portland, Oregon.
Alloy, West Virginia, was on the river that went through Charleston. It was about thirty-five miles southeast of Charleston. I put in a number of jig plants at these different alloy plants to separate the alloys from the slag. They would pour the alloys from the furnaces, and they would always get some of the alloys, like ferrochrome or ferromanganese, mixed with the slag, and we had to crush it. Before I got there, they threw all this stuff back into the furnace, and it cost them a lot of money. I was able to install jig plants that would separate the metal from the slag, and the metal could be sold directly, without remelting, and then the slag was discarded. I traveled just constantly for the last two and a half years that I was in Niagara Falls, to these various plants. I wasn't home but, oh, probably 25 percent of the time, at the most. And then the Union Carbide Ore Company began borrowing me. The first thing that they had me do was run a beach sand pilot plant north of Jacksonville, Florida, go down and set it up and run it. They were after titanium at the time. These beach sands down there contained rutile and ilmenite, which are both titanium minerals, and monazite, which is a rare earth mineral, and zircon, which is a zirconium oxide mineral.
I was gone all week, and the Ore Company insisted that I fly back to Niagara Falls every weekend, and so for five months I commuted from Jacksonville to Newark and then took the helicopter over to La Guardia [Airport] and then went from there to Buffalo and arrived home about two or three in the morning on Saturday, and left again about two in the afternoon on Sunday and went back to Jacksonville.
Swent:
And Jean is patiently sitting there with how many children? Four children then?
Shoemaker:
Four by that time.
Swent:
Oh! She deserves a little credit in that.
Shoemaker:
She certainly does. I don't know what I would have done without her.
When I was with the Ore Company, they established a government-bonded warehouse in Newport News, Virginia, and brought in ores from all over the world--manganese and chromium ores. This bonded warehouse was nothing more than a huge open field with railroad tracks running through it, and a fence around the whole thing. They kept about a half a million tons of both chromium and manganese ores there and would ship them out to the various plants that Union Carbide Metals owned. I called it--it was a government-bonded warehouse, and I called it--I've always said that I worked in the biggest government-bonded orehouse in the world!
During the Cold War with Russia, it was a kind of interesting time because the United States put an embargo on importing ores from Russia. For many years--
Swent:
Let's get a date in there. When was this?
Shoemaker:
Oh, this was along about the latter part of the Korean War. I went to the Ore Company in 1957, and that's when they built this government-bonded warehouse or orehouse. They had been buying chromium ore, even during World War II, from Russia. The ships that went up to Murmansk during the war--many of them came back loaded with chromium ore, chromite. But anyway, we had to stop importing Russian chrome ore. We suddenly found another deposit of chrome ore which was located in Montreal, within the city limits of Montreal.
Swent:
Good heavens!
Shoemaker:
It was called chrome ore X. Well, actually, the Russians would send this Russian chrome ore to a broker in Montreal, and then they would transship--they would unload the Russian boat and load the chrome ore onto other--maybe Canadian or American or any type of boat--and bring it down to Newport News. It was called chrome ore X. The United States government never knew that that was the way of getting around this embargo. But we were quite proud of this chrome mine that was in the middle of Montreal.
We had chrome mines in New Caledonia, South Africa, one in the Philippines--
Swent:
These were actually Union Carbide-owned?
Shoemaker:
They owned these mines. And then we had the largest manganese mine in the world by far in Ghana. It furnished 48 percent manganese ore, which was the standard in the industry, and all other manganese ores were compared with this ore that we produced over there, which contained 48 percent manganese. And it also furnished 80 percent of the free world's supply of dry-cell-battery manganese, which ran 53, 54 percent manganese. The thing is now shut down. It was nationalized and then shut down. The Ore Company also owned a very fine ore boat. It was called the Vindafjord. It was painted white. It was a beautiful boat. It held about--I think it was 18,000 tons. It made eleven trips a year from our plant in Norway--the Ore Company owned three ferro alloy plants--two in Norway and one in England. This Vindafjord made eleven trips a year between Norway and Ghana, and it had accommodations--it had twelve staterooms, and our Norwegian subsidiary up there would let their workers take their vacations on this boat. It would go from Sauda in Norway to the Canary Islands, where it would refuel, and then let these people off, and then it would go on to Ghana and load up the manganese ore, and then stop back for refueling at the Canaries. It was only the workers in the plant that got to do this. None of the managers were--
Swent:
You were saying that this was only for the workers, not for the managers.
Shoemaker:
Not for the managers. In these plants and mines overseas, we had no Americans involved except geologists that might visit once in a while, and then I would visit and work actually at those plants, but I reported to my boss in New York. For instance, I spent four six-week periods each year in Norway for almost five years that I was with Union Carbide Ore Company, plus going to some of these other places.
The Vindafjord was owned partly by Norwegian-American Lines and was operated by Norwegian-American Lines. The Vindafjord--it was beautiful. It was painted snow white, and when they loaded manganese ore on it, the whole thing would be black, but within a day it would be polished and washed so that it looked like a liner, a passenger boat, rather than an ore-carrying vessel. The Ore Company bought this other boat called the Tontine. It was brand new. It was owned 40 percent by the Ore Company and 40 percent by Norwegian-American Lines and 20 percent by a Norwegian company which was owned by officers of Union Carbide, as their private investment. They were allowed to buy pieces of this boat. As soon as they took delivery on this boat, the bottom fell out of the shipping market. It fluctuates, you know, wildly. And they found that they could lease other boats cheaper than they could run the Tontine.
Shoemaker:
This was also during the Cold War, which China was a part of, Red China. So they leased this ship--which was about 20,000 tons capacity--they leased it to the Red Chinese, which was strictly against United States government policies. But this 20 percent that was owned by the officers of Carbide--this was just a dummy company. It was a Norwegian company, and the owners didn't show up as directors of the company, so the Norwegian-American Lines had 40 percent, and they combined with this 20 percent ownership to make 60 percent, and therefore they could outvote the 40 percent that the Ore Company owned.
And so they leased--with that 60 percent ownership, they were the ones that could lease the boat to the Red Chinese. The Ore Company, naturally, wrote a very, very strong letter to both the Norwegian-American Lines and the 20 percent-owned company, protesting the leasing of this ship to the Red Chinese, and that got them off the hook, you see.
Actually, it was interesting. When I would go to Norway, I kept my paperwork to an absolute minimum because this was a Norwegian company and it was run by Norwegians, and yet we owned it.
Swent:
This is the company that ran the ferro alloy plant, not the shipping company.
Shoemaker:
The company in Norway was called Electric Furnace Products Company, and then we had another one called Meraker Smelteverk. Theoretically, we couldn't tell the Norwegians what to do. We wanted to keep it arm's length. Once a year, Carbide lawyers would come into our offices. There were only about twenty-five of us in this company, including the mail boy, in New York. They would go through our files, and anything that they didn't like, they would just throw into a big box and take it away and burn it. They didn't want the government to come in prowling around and seeing that we were actually doing any directing of these companies. It had something to do with taxes, and I don't know what it was, but they would come in and just--the word "decimate" today is misused badly because it means only 10 percent. But they "decimated" my files by about 30 percent every year, maybe even 50 percent! Getting back to that Tontine, it was very funny because the first voyage of the Tontine, the front end of the ship was loaded with wheat and the back end was loaded with automobiles.
Swent:
This is going from Norway to Ghana?
Shoemaker:
No, this was the one we leased to the Chinese. It went down through the Suez Canal and on into the Red Sea. It ran onto a rock that was in the middle of the Red Sea that no one knew about. This thing was right in the shipping lanes, and it had been there for a hundred years, and no one had ever run onto it before. It was stuck on the rock for over three months. They dumped all the wheat overboard, and all the automobiles were dumped overboard, and they finally got the thing free, but they were afraid that the whole thing would sink in a big storm. They later went in and put some divers down there and blasted that rock out of the way.
Swent:
For heaven's sakes. It really was a rock, then.
Shoemaker:
It was quite a good-sized rock. Actually--I said three months --it took them four months to get that thing off the rock. But it's strange how big companies work. They weren't doing anything that was strictly illegal, but they didn't want it to appear being anywhere near illegal. That's why the lawyers would come in, and I suppose they did the same to Union Carbide International, which owned a lot of chemical plants and other types of plants in other countries, including the one in Bhopal, India, that killed so many people. I think that was a horrible mistake.
I wouldn't trust the Indians to run a plant like that. I wouldn't trust a lot of countries to run a plant like that all by themselves. I think it's a terrible thing.
Swent:
It turned out to be a mistake.
Shoemaker:
I wanted to tell a little bit about--we put in a manganese nodulizing kiln, which was my idea. I converted an old lime kiln over in Norway to nodulize manganese ore fines. Manganese ore is very soft, and it makes a lot of dust in the furnace, and this dust will cave in into the electric furnace after it builds up on the sides and creates explosions. I had the idea of putting these fines into a rotary kiln and getting them hot enough so they stuck together and made nodules the size of baseballs. This had only been done at three other places in the world.
Swent:
Is this similar to pelletizing?
Shoemaker:
In a way, but the pellets are generally five-eighths of an inch, and they are made in a different type of furnace. But anyway, the one in Norway worked so well, then we put the one in Newport News in. We got a man by the name of Homer Hutchinson, who had been a master mechanic in a mine in the Philippines and was captured and was in the Santo Tomas prison camp during the war.
He was a mechanical genius. He built a radio by himself in that prison camp and was able to listen to American broadcasts. He was so valuable, they wanted to keep him, and the Japanese kept trying to send him to Japan. Finally, they told him he had to go the next day. There was a doctor there that operated on Hutch without any anesthetic and took his appendix out, so they couldn't take him. That was a ship that got sunk by the Americans.
Anyway, after the war, he went to work in New Caledonia at our chrome mine down there and then was brought back to the United States and worked in Rifle, Colorado, in the uranium mines, and then came and worked at Newport News. He became a very close friend of mine. He invented more innovations in materials handling equipment than you can almost think of. I had first met him when I was over in Australia for Union Carbide Ore Company, which I've related in my memoirs.
When I was ready to leave Australia, my boss at Union Carbide Ore Company asked me to go to our mine in New Caledonia and take a look at it. It was run by an Englishman, but New Caledonia at that time was still controlled by the French. It seemed like they did an awful lot of drilling over there, but they never found any more ore, and the reserves were getting quite small. So they finally decided that since I was over in Australia, they would send me over there to stop by and make a visit.
It was quite labor intensive, but that wasn't the whole problem. If they had invested money in labor-saving devices, they could have made more money. But anyway, I met the manager, who was an Englishman. He was saying that he was going to locate a new exploration hole the next day and asked if I'd like to go along with him, so I said, "Sure."
So I went out the next morning with him, and he got out of the Land Rover that he was driving and I was riding in. He had a couple of welding rods that he had bent in the form of an L-shape, right angle. He started walking around with these welding rods--
Swent:
Like a dowser?
Shoemaker:
Like a dowser! Actually, after half an hour, he said, "This is the spot where our new drill hole is going to be." Well, he had been doing this all this time. He had never had a geologist on the staff. He had never hired a geologist. He did his own dowsing, but he never found any more ore. I went back to New York, and I told my boss, Tom Meek, about that, so they removed him and got a new manager for the mine.
Swent:
Did they find more ore then?
Shoemaker:
Yes, they did.
Swent:
With a different method.
Shoemaker:
Yes. [laughter]
Swent:
Oh, dear.
Shoemaker:
Hutchison--I have this one about Hutchison. He's dead now. But when he was working in Rifle, he liked to drink a lot--not on the job, but he would drink it up at night. He went to a party one night, and a few days later this man came to the door and he says, "I've got your organ outside." He says, "Where do you want it?" Hutch said, "What organ?" And he said, "Well, the one you ordered from me the other night at the party." Well, Hutch didn't remember it at all, but he had always wanted to play an organ, so he told the man to bring it in. And his wife, who could play the piano--she taught Hutch how to play the organ.
Down in Newport News, he had it hooked up to twelve different speakers in his house. He would play the organ, and the plant superintendent and I would go down there and we would drink Kentucky Gentleman [bourbon] out of jelly glasses because that's the only kind of glasses they had. They were very casual in their housekeeping! And he would play the organ, and you could hear it all over the place. People didn't mind because he played so well.
Swent:
Well, that was good.
Shoemaker:
Another mine we had was in South Africa. It was a chromite mine. Spedden, who was my boss in Niagara Falls, had gone to South Africa, and he visited this mine. They had just installed a heavy media plant for separation of the waste from the ore. A heavy media plant--they were using very finely ground ferro-silicon mixed with water to give a slurry of specific gravity of around, oh, 2.8 to 3, which means 2.8 to 3 times the specific gravity of water.
The chrome ore would sink in this slurry. The slurry was kept agitated all the time. Most of the waste material was composed of a kaolin clay, which was extremely light. It had a specific gravity of, say, maybe 2.0, so it was a very, very simple separation job. The plant wasn't working because the kaolin, being so very soft, would grind up, and the slurry would become extremely viscous. Well, this would happen with most any ore, but it happened particularly with this one because the kaolin was so soft.
The chrome ore would sink, but part of it would sink and a lot of the kaolin would sink with it and a lot of the chrome ore would float, along with the kaolin. It was a mess.
So Spedden had the idea that he could decrease the viscosity of this slurry and make the plant work, and so he came back--he brought samples with him, and he came back to Niagara Falls. This was when--I don't think we should mention his name, but we have mentioned it before. He was working there, taking my place. They experimented with trisodium phosphate, which is a dispersing agent. It lowered the viscosity of this slurry so that the heavy media plant would work properly. I was in South Africa shortly after this, and I went out to the plant, this chrome plant.
Swent:
Where was it?
Shoemaker:
It was in the Transvaal, north of Johannesburg, a hundred and fifty miles or so. At the heavy media plant--the sink product mixed with ferro-silicon and the float product mixed with ferro-silicon flow out of this drum that the separation is made in. The two products go onto screens. The first part of the screen--the ferro-silicon goes through and drains. They call that the drain section of the screen, and it is pumped directly back to the separation drum.
But then the ferro-silicone has to be washed off of both the sink and float, the chromite and the gangue mineral. And so the second part of the screen is called the wash screen, and they spray water on it, on the ore that goes across the screen, and the ore and waste is washed clean of ferro-silicon, and then this dilute slurry goes to first a magnetic separator, which removes the non-magnetic gangue material from the magnetic ferro-silicon. And then the ferro-silicon goes into what we call a spiral classifier, which is used as a densifier. It removes enough water to bring the specific gravity of the slurry back up to what is required in the separation drum. Underneath the screens there is a launder that can be moved along underneath the screen to either increase or decrease the amount of ferro-silicon going directly back to the drum from the drain section, or increase or decrease the amount of ferro-silicon that goes to the wash section of the screen. This launder is on rails, and you crank it along with a crank to get the right ratio of drain and wash.
Well, this manager was telling me how great this idea was that Spedden had of using trisodium phosphate to decrease the viscosity of the ferro-silicon slurry. He had just bought a very large tonnage. The way he explained it, it was about a quarter of a shipload. The plant was working quite well.
But I noticed that these launders had been moved all the way forward, so there was very little of this slurry of ferro-silicon and kaolin that was getting into the wash section and going to the magnetic separator and the densifier. I asked him why he operated this thing with these launders so far forward.
He said, "What do you mean?"
And I said, "Well, you see this crank here. It moves this launder back and forth and puts more of the ferro-silicon into the wash section, which gets rid of the kaolin in the magnetic separator and it prevents a build-up of the fine kaolin." And I said, "This thing is clear forward, and you have nothing going through the cleaning circuit and virtually everything going back to the drum. Why don't we move this launder back to where it should be?"
He says, "Oh, that's what it's for." [laughter]
So I moved these two launders back to about the midpoint there, and then I asked him to cut off the feed of the trisodium phosphate. The plant ran without any trisodium phosphate. It ran perfectly.
He said, "What am I going to do with all this trisodium phosphate?" He said, "I've got a quarter of a shipload of it." I said, "Well, that's not my worry. That's yours. But you certainly don't need it."
Well, Spedden and his assistant were writing a paper on this use of trisodium phosphate to reduce the viscosity of the media in the heavy media plant. I didn't say anything about it, but Spedden at that time--he was down in New York, too. We had moved to New York at the same time to go to work for the Ore Company. He heard about it from my boss, and they had to cancel the publication of the paper. Spedden wasn't very happy with me.
Swent:
I'm sure not!
Shoemaker:
I was continually doing things that got me into trouble. But my boss always got me out of it.
Swent:
Who was your boss?
Shoemaker:
Tom Meek, a wonderful man. He let me do anything I wanted to do because he knew I always made money for the company. After being with the Ore Company for almost five years, I could see that we were going to be absorbed by the Union Carbide Metals Company, and I just decided that I would like to get back West. I had been in the East for over twelve years. One day, a man from Bechtel came to see me and asked if I'd be interested in going to work for them. He had heard about me through a friend of mine. So I did. I was very much encouraged by my boss. He said if he was younger, he would have gone, too. If I had gone with the Union Carbide Metals Company, I would have been a very small frog in a large pond instead of the big frog in a little pond.
Shoemaker:
When I was at Bechtel, I was elected president of the Mining and Metallurgical Society of America. The MMSA was established in 1908 by a group of prominent people in the mining industry. Actually, because of the efforts of the MMSA in its early days, the U.S. Bureau of Mines was established. It was almost like an honorary society, but it had been very active in most of its years, but it became kind of dormant in the fifties.
I had been a member of it in New York. When I got to San Francisco, I decided to see if I could start a San Francisco section of the MMSA, which I did. It became quite successful. It's still in existence, and it is more active, by far, and it has far more members than the New York section did, even at its peak. Most of the mining people, mining houses, moved out of New York. Anyway, I also got a directory published, which is still being published. It has a biography of each one of the members in it. It's quite valuable.
Swent:
A wonderful resource. It's very helpful to me.
Shoemaker:
Yes. During the two years I was president, I nominated and was very privileged to award Plato Malozemoff
the Mining and Metallurgical Society gold medal, which they occasionally award to some very, very distinguished person in the mining industry. Because Newmont, under Plato, had established the Carlin gold mine in 1964, when I was chief metallurgical engineer at Bechtel, and we built the plant--designed and built it in ten months--I thought the gold that was in this medal should come from Carlin. So I talked to the manager of the Carlin Mine, Jay McBeth, who was a good friend of mine. McBeth sent ten ounces of gold to Tiffany's in New York, who had the dies to stamp this medal with. Shortly after, I got a call from Tiffany's saying that they couldn't melt this gold. It turned into little globules that wouldn't coalesce.
Swent:
It granulated?
Shoemaker:
They were kind of frantic. It was really very pure gold. So I called my friend who was chief chemist at Carlin, whose name was Harry Treweek. He was a Cornishman. And he says, "There's no problem with that." He says, "That is caused by three or four parts per million of chromium that is in our gold, and it causes the surface tension of the gold to increase, and it forms little tiny globules when you melt it. The cure for that is to melt it with a borax cover, borax poured over the gold in the crucible. Then" he said, "you won't have any problem."
Speaking of Plato, I became quite well acquainted with Plato in New York. I would see him at the Mining Club occasionally and would see him in his office occasionally, too, when I was over visiting with Frank McQuiston.
When we built Carlin, after it was built, they had a dedication ceremony because that was the first gold plant that had been built in over thirty years in the United States. Plato was there to give a speech. They had the governor there, and Steve Bechtel, Sr., was invited. He flew in a company plane over there. I was there also.
Plato was put up at the Stockman's Hotel in Elko. The Stockman's Hotel unfortunately was located right alongside the railroad tracks. They've been moved since then. But the suite that they put Plato in had a window that had the railroad tracks right alongside. Plato didn't get any sleep at all because they were switching trains through there all night long. Plato was supposed to stay there for two days, but after the ceremony was over and Plato had given his speech, he asked Steve, Sr., if he could go to San Francisco in Steve's plane so he could get back to New York, which Steve, Sr., was very happy to do.
Strangely enough, Plato never returned to the Carlin plant. Not ever in his life did he return to the Carlin plant. Yet that is--
Swent:
The star in their crown.
Shoemaker:
Yes. In fact, now they've recombined Newmont Mining with Newmont Gold, and it's all one company again. They're not in any other business but the gold.
Swent:
It's one of the major producers in the world, that mine, isn't it?
Shoemaker:
Yes, it's one of the very big ones in the world.
Swent:
But he didn't like the Stockman's Hotel.
Shoemaker:
No, he certainly didn't.
Shoemaker:
Speaking of Bechtel airplanes, we had three of them. They were called Lockheed Learstars. They were Lockheed Lodestars and were also the Lear conversion of the original Lodestar, which made them faster. They had a little bigger engines, and they had more streamlining. Bechtel had two of them in the Oakland Airport and a third one in Westchester, New York. When Steve, Sr., still ran the company, business came first for those airplanes.
As chief metallurgical engineer, if I wanted to take a crew of people someplace to work on a plant or even see a plant, I could get one of those airplanes to do that. That was also true when they traded them in on turboprop Grumman Gulfstreams, but those were eventually traded on French Falcon jets when Steve, Jr., took over. And at that time, I couldn't even attempt to get one of those airplanes. They were used entirely for taking clients fishing and taking them on hunting trips or golfing trips and also taking the vice presidents along with the people.
Swent:
This might be a good place for you to talk a little bit about Steve, Sr., and his business ethics?
Shoemaker:
Oh, okay, I'll do that. Let's take a break for a minute.
Swent:
Let's talk about Steve Bechtel, Sr.
Shoemaker:
All right. Steve Bechtel, Sr.--of course, his father started the company. I can't remember when it was started. His name was W. A. Bechtel.
Swent:
Warren, I think.
Shoemaker:
Warren. There was also a son by the name of Warren, who was the brother to Steve, Sr., who worked for the company, too. But then he was more interested other things. Bechtel started an insurance company. He, Warren Bechtel--that is, the son--took over the insurance company. This insurance company became Factory Mutual, which later became--well, it still has that name. I got my automobile insurance when I was at Carbide with Factory Mutual because they gave the Carbide people a discount. I still have it, but it's called Automobile Mutual now.
Anyway, Steve, Sr., was one of the most honest people in the world. He was very, very ethical and wanted all of his people to be very ethical. He was extremely well respected by people all over the world. He had a great memory for names. He surrounded himself with people who were very, very fine engineers, although there was one fellow who was a senior vice president, by the name of Jerry Komas, who had only got as far as the ninth grade and yet he was one of the very senior people at Bechtel.
It was said that Bechtel never tried to influence people with money, like a bribe. I can remember being in New York at an AIME [American Institute of Mining, Metallurgical, and Petroleum Engineers] convention. The Mining and Metallurgical Society has a luncheon meeting at every AIME convention. I was sitting next to George Munroe, who at that time was president of Phelps Dodge. The speaker that day was Ralph M. Parsons, who at one time had been associated with the Bechtels. Originally, the company was called W. A. Bechtel & Sons, and then it became--John J. McCone, later headed up the CIA--it became Bechtel, McCone, Parsons. Ralph Parsons was that Parsons. Parsons was--he was a very flamboyant type. Although Parsons was in on the building of the Hoover Dam with the Bechtels--they were one of the Big Six--they didn't get along too well, so Parsons left and formed his own company, which became quite successful.
Swent:
There's the Parsons Brinkerhoff Company; then there's also Parsons Jurdan. Are they the same?
Shoemaker:
They're not the same.
Swent:
So he started what was--
Shoemaker:
Ralph M. Parsons Company. That company is still in existence. Ralph M. Parsons took over--I think it was called Jurdan Associates. Jurdan was chief engineer of Anaconda. When Anaconda decided to give up their own engineering department--it was so large that they designed and built plants for other copper companies; Anaconda sold their engineering department to Jurdan for a dollar. He formed Jurdan Associates, along with some of his top people, and became quite successful. And then he got ready to retire, so he sold out to Parsons. Then it became Parsons Jurdan. At least the mining and metals part of it became Parsons Jurdan. Anyway, that day at that meeting, Ralph M. Parsons was the speaker. He was a very short man. He couldn't have been over five foot one or two, at the most. They had to scurry around to find a box for him to stand on so he could look over the podium at the audience. There was, oh, probably 125 people there.
He was supposed to talk about doing engineering and construction overseas. He started out very well, but then he digressed and mentioned that occasionally he would have to pay bribes to people overseas, customs people and other types of people. And then he couldn't get off the subject, and he went on and on and on about how to bribe people. I was just embarrassed, working for Bechtel, to listen to that. Finally, this George Munroe leaned over to me and he says, "I will never give Parsons one dollar's worth of work after this. That is the worst thing I ever heard."
I don't think Bechtel was involved to that extent. You certainly have to have certain people that are lawyers and are well connected in foreign countries, and Bechtel may have had to give money to other people, but I never heard of it. The only two instances I ever heard of was an iron ore company that we built a plant for in Canada. When the thing was being constructed, they had an awful lot of labor trouble. It was a union job. The owner of the plant was approached by one of the officers of the union, who asked for money so that the union wouldn't cause any more trouble.
The owner didn't want to get involved themselves, so they asked the construction superintendent if he would give the money to the union man. He agreed to it. So the owner gave a very substantial amount of money to the construction superintendent, who gave it to the union officer. Somehow the word got out, and when Steve, Sr., heard about it, even though the man was a very senior construction superintendent, Steve, Sr., just fired him out of hand. He wouldn't tolerate anything like that.
There was another one that I heard about. I didn't know anything about the plant. It was a pipeline back in the East. The same thing happened. The owner of that pipeline asked Bechtel's construction superintendent to give this money to a union representative to stop the problems they were having with the union employees, construction employees. Word got out on that, and Steve, Sr., again, fired this man right out of hand, even though he was a very old and trusted friend of his.
Some companies, I do know, and some engineering firms like to work for the government and government installations overseas. Some of them really specialize in that. Bechtel never liked to work for the government after World War II. Occasionally, the government would come around and say, "You've got to submit a bid on this little bitty job, just to keep the other people honest," and Bechtel would take it. But U.S. government work was a very small fraction of one percent of the work. They did not like to work for the government. There were government people asking for bribes, and Bechtel could get along perfectly well without doing any government work.
They worked for quasi-governmental agencies, like, say, the utility districts. Some utilities are owned, you know, by cities. Or they worked for irrigation districts and put in dams. But they didn't like to work for either the state or the federal government.
Swent:
Did they do AEC [Atomic Energy Commission] work?
Shoemaker:
I don't think so. If it was, it was very little. Of course, they were very big in the atomic power business. They would buy the units themselves, the reactors themselves, from Westinghouse or G.E.--I guess there were others--Babcock & Wilcox. But there hasn't been a nuclear power plant built in a great many years, as you well know, which is absolutely ridiculous because they're perfectly safe. The Three Mile Island plant--Bechtel went in and cleaned that up, by the way-- but no one ever got hurt from that, no one got sick, it never affected anyone.
Swent:
But they still call it a disaster.
Shoemaker:
The environmentalists are still calling it a disaster. The Chernobyl plant really killed a very small number of people compared to what the environmentalists claim. But the nuclear power plants that we built are so much safer. Now they've developed even ones that--the breeder reactors--they make their own fuel, you know? And there isn't anything left over. Now the government has permitted some companies to build two nuclear power plants in China. Seventy-five percent of France's power is provided by nuclear plants. Uranium is an absolutely useless metal except for making nuclear power. Many years ago, they used to use a little bit of it in pigments to get a yellow color. But it's absolutely useless for anything else today. And yet the government wants us to burn natural gas, which is nonrenewable. It is necessary in the plastics industry, completely necessary, yet they want us to burn more natural gas in power plants. And over in Reno, they just now approved this new gambling casino that's got a--what is it?--a structure like an oil rig, where they drill for oil, you know?--but with a gas flame coming out of the top of it about sixty feet high.
Swent:
Burning all the time.
Shoemaker:
Burning all the time.
Swent:
Polluting the air and everything else.
Shoemaker:
It's clean burning, although of course the way that is burned there it's a red flame that is coming from carbon particles that are red-hot. When gas burns efficiently, it has a blue flame like a gas stove. But to destroy these coal and gas resources by just burning them--I think we should save the coal and gas for future generations for the chemicals that are available from them. Of course, we've got a lot more coal than we have natural gas, for that matter. But then, after that, then they have tar sands and oil shales. But nuclear power is the only way to generate power.
That brings me to the next subject.
Swent:
Well, we kind of got off from the--you did tell an interesting little anecdote earlier about dealing in Iran. Do you want to mention that now? propos of Bechtel.
Shoemaker:
Yes, I was sent to Iran with four Bechtel vice presidents. We wanted, hopefully, to be able to build a very large copper plant that the government of Iran--that was during the time of the Shah--wanted to build. We didn't get the contract. One of the vice presidents was a financial man, and he had met a man who was part of one of the big families there in Iran that owned so much of the country and so much of the industry, very closely connected with the Shah.
We had an appointment to see him. The night before, we were in the cocktail lounge of the Intercontinental Hotel, which was the only place that you could buy a drink, I think, in Iran. And all the Iranian elite came in there for drinks.
Shoemaker:
This Irani gentleman was there in the cocktail lounge with a very beautiful girl who wasn't his wife. We were cautioned by this vice president, who knew him, not to even--he would not acknowledge our presence, and we should not even look at him because officially he wasn't there. We had a meeting with him the next day at his home, and we gave him you might say a sales talk on Bechtel and how we could do this plant. If we had done the plant, undoubtedly this man would have earned some fees by smoothing the way for us.
In fact, you have to have someone in every foreign company that can help you with their laws and rules, but Steve, Sr., would not just bribe people. He would pay them for their services, but he would not just plain bribe them. He refused to. He had that reputation. Is there anything more you'd like?
Swent:
No, that's fine. There may be other things that will come up as we go along.
Shoemaker:
I mentioned tar sands. When I was chief metallurgical engineer, I was the first one at Bechtel. They had chief mechanical, electrical, and civil engineers, but then when I got there, they started getting much more business. After I had been there about two and a half years, they made me chief metallurgical engineer. Eventually, I had thirty-five metallurgists working for me. We were the largest in the mining and metal business.
Shoemaker:
I mentioned tar sands. Northern Alberta has enormous reserves of tar sands. This tar is mixed with sand. I've forgotten the percentage of tar in the sand, but these sands are right near the surface, and they're flat-lying deposits. They're not tremendously deep, like thousands of feet, but I guess they're several hundred feet deep. Sun Oil Company awarded the contract to Bechtel to build the first tar sands plant.
Swent:
When was this, Bob?
Shoemaker:
This was in probably, oh, along about 1966 or '67, something like that. Sun Oil formed the Great Canadian Oil Sands Company. These deposits are up by the Athabasca River, a couple of hundred miles north of Edmonton. The closest town is Fort McMurray, which is fifteen, eighteen miles from this plant that we built. We had first to build a pilot plant for them. They had done a lot of research work in the laboratories, but they wanted a pilot plant.
So we set up a camp up there, using conventional northern type of mobile housing that they had--all these big, prefabricated units that they bring in and connect up to make virtually small towns. We had a number of those up there. Bunkhouses and offices and cook houses.
Swent:
Was this before Prudhoe Bay?
Shoemaker:
Oh, yes, yes. After the sands are mined--they're just coal black. They go through a hot-water extraction process where, at that time, they heated them in the big plant that was built. You had to heat enormous quantities of water with some of this material which was made out of the tar. Anyway, the tar could be separated and it would float to the top of these very large vessels after going through a rotating drum device with hot water in it to get the tar melted, because it was all permafrost. It was frozen down to, I think, hundreds of feet.
Then the tar would be separated, and we had the pilot plant which we set up to treat it. It was around fifty tons a day, as I recall, a twenty-four-hour day. And then a portion of the tar that we produced in the pilot plant was put through a small pilot refinery up there, which then made a material that was similar to conventional crude oil. In other words, the tar was not like crude oil at all. It had to be hydrogenated and I don't know what all they did to it, but it turned into a material that looked and acted and had the consistency of crude oil, which then had to be refined. We put a pipeline down to Edmonton and the refinery down there, eventually.
We first of all needed a good assessment of the sands as to how uniform they were and how some of this equipment, which we had to design specially for this separation business, how it would work. You didn't want to just take the overburden off and just get the top tar sands. We wanted to go deeper than that. So they started sinking a shaft.
I was chief metallurgical engineer, but at the same time, they made me project engineer on the construction and operation of the extraction facility. They had another project engineer, whose name I can't remember, who was in charge of the refining pilot plant, to make crude oil. And then they had an overall project engineer, who was over the two of us. He was from the Mining and Metals Division, whereas the man in charge of the refinery part--he was from the Refining and Chemical Division. This man's name was Earl Johnson. He had been in the copper business. I think he had worked in Chile to some extent. He was in his sixties.
Sun Oil Company was very, very difficult to deal with because they were an oil company, and we were trying to design this extraction plant. They didn't know anything about materials handling or pumping of slurries. They were oil people. It was very difficult. We got into a lot of arguments with those people, trying to make them see that they had to build a mineral processing plant, which it was, differently than a refinery.
Swent:
This was a whole new thing.
Shoemaker:
Yes. Well, I kept going. We got the pilot plant finally designed, and we built it up there, and I went up to start it up and start the extraction plant up. We were supposed to get feed from the shaft that they had started. Well, the shaft was eight by ten feet inside of the timbers. They laid a concrete slab with a hole in it to start the shaft and started digging in it. They would put in a set of timbers every four feet. These were eight by eight timbers, in a rectangle, and then behind the timbers was two-by-ten or two-by-twelve boards--lagging, we call it--and that kept the tar sands from coming through from between the timbers.
Each of the timbers was connected to the next timber down, which was four feet away, by a bolt that was called a J-bolt, in the form of a J. There was one bolt going up and the other one going down. [demonstrates with a paper] That describes it, you see.
Swent:
Sort of interlocking.
Shoemaker:
They were excavating with jack hammers. This material was frozen. As they got down, oh, around twenty-five feet--there was a mining contractor, and they were only working on one shift. This started in the springtime. I should say we could fly into Fort McMurray, and in the wintertime we would just take a taxi out to the site, which was fifteen or eighteen miles north, along the Athabasca River. We would drive on the ice on the river, the taxi! [chuckles]
And then after break-up of the ice on the river, then we had an airplane that we would charter, a little twin Beechcraft owned by an old bush pilot who one day landed at Fort McMurray when I was on board with the wheels up. He didn't land completely. He got down--he realized at the last minute that his wheels were not down, and he poured on the power, but the tips of the propeller hit the runway, and it was a paved runway, and it bent them back about a foot.
Swent:
Oh, my.
Shoemaker:
All four of them. There were two engines, with two propeller blades on each engine. He managed to get it around and broke the gear cases, and oil was going all over.
Swent:
Oh, my.
Shoemaker:
Anyway, he managed to get it around on a half a propeller blade, which was very little propeller--mostly hub. Anyway, then they took his license away from him.
Getting back to the shaft--when they got down about twenty-five feet, the compressed air they were using--this was in the springtime--the compressed air would warm up--the exhaust from the jack hammers would warm up the shaft, the interior of the shaft. The air would go in back of this lagging and would start melting the tar.
Swent:
[chuckles]
Shoemaker:
It was actually raining tar down that shaft all the time, and the deeper the shaft got, the more it rained. You had to wear a plastic suit. I went down there each time--I would spend half of each week up there. I wasn't in charge of the shaft, but I wanted to see the ore in place. It was difficult to see because these men--a couple of men down there running these jack hammers, and you had rubber boots on, and they were just walking around in this goo, eight by ten feet in area--black goo.
Anyway, these tar sands kept melting from behind the lagging, and they would create pockets behind the lagging. When they would discover a pocket, they would move one of the lagging boards and pack wood in there, wooden wedges, soft timbers, and fill in chunks of wood. But all of the tar sands around the shaft were melting and getting soft, and so they were moving downward into these pockets, and they were pulling down on these timbers. The deeper the shaft, the more force they exerted on the timbers. When they got to about forty feet, the J-bolts pulled apart at that point. And these were one-inch steel bolts, and there were about three or four of them on the long side and two on the short side. It was creaking and groaning. It was scary. Well, they managed to get new bolts installed. As they got down, they brought the timbers closer together. Finally, they were only one foot apart. It was just very slow.
I was down there, and they got it down to I think it was eighty feet.
Swent:
How were they bringing up the ore?
Shoemaker:
With a hoist, in a bucket. These men would load the stuff into this bucket and they would hoist it out.
Swent:
But they were drilling down.
Shoemaker:
Yes. A spade bit on a jack hammer. I kept telling Earl Johnson, who was the overall project manager, and he was in charge of the shaft, that that shaft was dangerous as hell. Earl wouldn't go down in it because he was big and heavy, and he had a problem with chronic bronchitis or something was wrong with one of his lungs; it wasn't cancer.
I kept telling him that this was terribly dangerous. I finally got him to put on three shifts because the stuff would melt at night, and they would have to repair all the damage during the day, and they weren't doing that much mining for the plant. The bolts pulled apart again at sixty feet and again at seventy feet. By eighty feet, I went down there, and it was just creaking and groaning something terrible.
Earl wouldn't stop them. So I had a great big argument with him. I said, "I'm going back to San Francisco." I went and talked to my boss, who was Bob Cheatham. I walked into his office, and I said, "I quit." I said, "I'm not going to take responsibility for that shaft anymore, and I'm resigning today."
Bob said, "Now, just calm down." Earl was going in to the hospital to have a section of his lung removed in a matter of a couple of days, and he said, "As of now, you're in charge. You take over from Earl."
I said, "Well, I'm going up there and shut that thing down."
He said, "Use your own judgment." So I got right back on the airplane and went up to Fort McMurray, and I told the contractor--by that time, he was working three shifts, trying to keep this thing going down and at the same time not pulling apart and having these cave-ins and so on. I went into the contractor's office and told him to pull his men out of there; we were shutting it down. That was in the late afternoon. About three o'clock the next morning, the shaft collapsed.
Swent:
But no one was in it.
Shoemaker:
Nobody was in it. There would have been two men in there at that time if I hadn't shut it down. That was just really lucky. But the whole thing just collapsed. It was a mishmash of timbers and tar sand. They would never have gotten anybody out of it. Then we used--well, during the time when they were having so much trouble with the shaft, I got an outfit to come up that had what they called a bucket drill. It had a shaft that went down, and it had a three-foot-diameter, round cylinder that was about four feet high on the end of the thing, and then it was closed at the bottom except for one big tooth that stuck down, like an auger. They would rotate that, fill the bucket up, and then pull the whole thing out of the ground. Then the bottom of the bucket would swing open, and we would get samples. You could drill a hole very fast, before it got warm, before warm air got into it. We could get down to eighty or a hundred feet and get more with that bucket drill than you could out of the shaft, and we could go more places, too. That was very important.
I didn't get along very well with this fellow who was in charge of the refining part of the pilot plant. I can't remember what we were arguing about, but we were always arguing. He was a pompous little twit. He would only take, oh, maybe 15 percent of the tar we made, and we made several hundred gallons a day, and the excess we would put into this pit we dug out there. The tar would freeze over at the top, but it was liquid underneath because it wasn't a very good conductor of either heat or cold.
We were standing at the edge of this pit on the chunks of frozen earth that had come out of the pit. He asked me how hard I thought this tar was. I said, "I'll find out." And I picked up this big chunk of earth and dropped it over his shoulder, and it went through that frozen crust and the tar just came up and covered him in goo [chuckles].
Anyway, that was quite an experience. That plant is still operating, and there's another company called Syncrude, and they built a larger plant, and now they're building a third one. Very shortly, Canada is going to be completely self-sufficient in oil from those tar sands. I think the newest plant is treating 200,000 tons a day.
Swent:
Good heavens!
Shoemaker:
It is a monstrous operation. They have found a way to--instead of heating the water--to use relatively cold water. The stuff is now competing with oil at about eleven dollars a barrel. It originally cost something like thirty dollars a barrel. It wasn't economic. But then oil went up, and their prices came down as they learned how to run these plants. They're a wonderful investment up there for Canada. There's Canadian government money in those plants now. And there's enough reserves for hundreds and hundreds of years. And it's up there where nobody lives. It's just frozen tundra. And they are very environmentally conscious. They take all the overburden off and replace it. They're beautiful plants. They don't do any pollution at all.
Swent:
Wonderful. That must have been exciting.
Shoemaker:
It was quite an operation. I really enjoyed it. It was tough living up there in those days, because you would carry this tar and sand around on your shoes and on your clothes. You just got sand into everything and tar into everything. The conditions weren't like they are today, of course.
Swent:
But they worked around the year.
Shoemaker:
Oh, yes. They work year-round up there. They use bucket-wheel excavators and extremely large trucks, and they have to be built out of special steel because they get so cold. Normal steel gets brittle at the temperatures they have up there.
On a little lighter note here, I was in an AIME meeting in Los Angeles one time, the last time they had an annual meeting there. I was sitting with two friends of mine--one from Allis-Chalmers and one from Tyler Screen Company. Somebody walked by and said, "Are you going to the Mines breakfast tomorrow?" "Mines" means Colorado School of Mines. Those of us who haven't gone there--we call it the Royal School of Mines. We said no, none of the three of us had ever gone there.
Well, someone came along a little while later and said, "Are you going to [the] Montana breakfast?" We hadn't gone there, either. They all kind of--particularly the man from Colorado, kind of sneered at us. After that happened about three times, we decided that that was enough, and we decided to start our own school of mines.
One of these fellows, the man from Allis-Chalmers, had worked in the early days at a place called Bouse, Arizona. This is over on the western side of Arizona. It's about thirty miles from the Colorado River and about fifty miles northeast of Blythe. We decided to start the Bouse School of Mines there. So we printed up alumni cards--
Swent:
[chuckles]
Shoemaker:
And we started having our own breakfasts. Eventually--oh, I don't know--there would be twenty-five or thirty of us alumni, and there were a lot of alumni that didn't come or wouldn't be able to be there. But the thing finally died. It was mostly old-timers. I don't have my alumni card anymore because I was fishing, and I fell in the creek one time and got it all wet, so I don't have that anymore. But we had a lot of fun, making fun of the other people who had gone to some of these fancy schools of mines.
Swent:
You said that the Palabora was the first job you were put on.
Shoemaker:
Yes, when I went to Bechtel. This was a joint venture between us and Western Knapp Engineering, which went through a number of name changes and now is called--
Swent:
Kvaerner.
Shoemaker:
Yes. That turned out to be one of the lowest-cost plants in the world.
Swent:
What were they treating?
Shoemaker:
Copper. The way they operated it, they ran schools for the black people, and they had the native people there driving trucks, whereas other mines there--they wouldn't let them drive trucks.
Swent:
Is Palabora in South Africa?
Shoemaker:
Yes. It's in the Transvaal. This plant was designed for 32,000 tons a day, and then later we went back and expanded it. We put in autogenous grinding mills. And then it has had another expansion since I left Bechtel. I don't recall what it is. It's up to seventy-five or eighty thousand tons a day. It's a big plant, a big mine.
Swent:
Did you do anything in the way of training people?
Shoemaker:
They had wonderful training schools for the people.
Swent:
Were you involved with that?
Shoemaker:
No, no. I was only involved in the design.
One day I got a call--we were installing the expansion, and we had to put a new primary crusher in. There were originally two primary gyratory crushers in there, what we call fifty-four by seventy-four, built by Allis-Chalmers. We were putting a third one in. We had the thing almost finished, the expansion, and I got a call from George Beals, who was the plant manager at that time. George told me he had a little problem and he would like me to come down to South Africa. I said, "Well, I think I can do that. When would you like me to come down?"
He said, "Can you get on a plane tonight?"
I said, "Well, I don't think I can tonight, but I can probably get on tomorrow night. Why the big rush?"
And he said--"Well," he says, "we've just broken the main shaft in one of our primary crushers." The main shaft of one of these gyratory crushers is about twenty-one or -two feet long, and it's, I think, twenty or twenty-two inches in diameter, and it weighs ninety thousand pounds. He said, "We've broken the main shaft."
I said, "My gosh, that's unusual. I've never really heard of a main shaft breaking." And I said, "You have a spare, don't you?" He said, "We've used up our last spare." They had a spare. They were keeping a spare on hand, but he said, "We've used it up. Actually, we kept two on hand, and we used them up."
I said, "Well, how about taking the shaft out of the crusher we've just installed that isn't operating?" And he said, "We've done that, too." He said, "We've broken five of these main shafts."
Swent:
Good heavens!
Shoemaker:
He said, "We don't have any spares." He said, "We're in serious trouble."
Anyway, I arranged to go down the next night, but I also called Allis-Chalmers and had their chief crusher designer get on an airplane, too. I met him in Johannesburg. We were met there by the son of the founder of Bateman Corporation; it's a big manufacturing and also engineering firm down there--who was a complete SOB.
We went over to his office. They had manufactured this crusher under license, both the crusher and a couple of the main shafts, although they then had started buying from Japan. He immediately insisted that there was nothing wrong with his equipment and made himself awfully obnoxious.
But anyway, I told George over the phone--I said, "I would like you to get ahold of the National Institute of Metallurgy." This is a physical metallurgy laboratory run by the government, and they're very fine. I said, "Get a man to come up there and take some samples of the metal where the shaft was broken and take it back and do some physical metallurgy on it." And so he said he would. It turned out, when I talked with this man from Allis- Chalmers, that they had manufactured a thousand crushers of this size around the world, they and their licensees, and they had only had five main shafts broken besides those at Palabora.
Swent:
And they were all broken at this same place?
Shoemaker:
No, they were broken at different places. Three of them, they didn't know why they broke. The other two, they had knocked the protective cap off of the top of the shaft and dumped rocks on it and just beat it to death. This one broke below the threads on the top of the shaft. There was a very large nut that held the mantle liners down onto the mantle. There's this section of the main shaft that is conical, probably four and a half feet at the bottom in diameter, and then these conical liners go down on top of that, on this cone-shaped section of the main shaft.
Anyway, when we got down there, and got out to Palabora, by that time this man from the National Institute of Metallurgy had gotten his samples and he had called up with his report. What it was, was stress corrosion cracking. The ore at Palabora is very tough, but it isn't very abrasive. These liners are made out of manganese steel, which will actually flow under pressure. The mantle liners are installed in two halves with a gap between them, which is filled with zinc so that it will be squeezed out as the liners flow together because of the pressure on the manganese.
That was causing--the liners couldn't go down on the cone as it got tighter, so the liners started flowing upward against the head nut and it exerted enormous pressure, so much so that the head nut, which was made out of steel and it was over--oh, it was thirty inches in diameter and probably four inches thick--it was actually bent up at the edges.
And then there was a locking hole, like on a castellated nut, where you put a cotter pin in to keep the nut from unscrewing on the threads on the shaft. Half of this hole was in the liner, and the other half was in the head nut itself. You turned the nut down until you got two of those half holes to line up to make one hole, and then you would put a pin in there so it wouldn't unscrew.
The water at Palabora, although it has a pH of over seven, it is very corrosive, apparently by some bacterial action, when it contacts the ore. We had to use an awful lot of stainless steel in the plant construction because of this corrosiveness. At any rate, dust was getting into these holes that were open, and then water sprays that were used in the dump pocket would go on, and the water would leak into these holes, and you would get your corrosion on the shaft. So with the stress and the corrosion, you got stress corrosion cracking, and it would just pop the twenty-inch-diameter shaft right in two.
Swent:
It's a complicated research project.
Shoemaker:
The fix was to put grease in those holes and also to use a torch to scarf out the joint between the two halves, the upper and lower halves of the liners, so you would give the liners more room to flow. At that time, each one of those shafts cost a dollar a pound, and that was ninety thousand dollars a shaft.
They broke five shafts, which was equal to the total number of shafts that had broken in all the other thousand crushers.
Swent:
But after that they didn't?
Shoemaker:
No more. They've never broken another one. The crushers are still operating.
Swent:
Well! That was quite a coup.
Shoemaker:
Well, I've been very good friends with George ever since then. I've gone back to Palabora as a consultant, and when George left Palabora, he worked for a time with Amoco when they were trying to get into the mineral business, and then he went back to work for RTZ, which used to be called Rio Tinto Zinc. Originally, it was Rio Tinto Mining. I worked for George down in Panama when he was with RTZ, and then over in Spain at Rio Tinto-Minera. We still see each other every now and then. He lives in Colorado. He was promoted eventually to being a director of RTZ, and he was the only American who was ever a director of RTZ.
George asked me to be on the due diligence committee when RTZ took over Kennecott. There was only one other American, whose name was Paul Hodges. He had worked for Anaconda. In fact, he worked for Palabora before also. He was a mining man. And he was the only other American on the team of sixteen that did the due diligence. So I worked with George a lot.
Swent:
That was a big job.
Shoemaker:
Yes.
Shoemaker:
I would like to talk a little about Bechtel and their clients. We always tried, at least until up to the time I quit, to give the client what he needed rather than what he wanted because he generally wanted much more than he needed. And yet the clients were always trying to cut the costs. You had to argue with them to give them what they needed rather than what they wanted. What they needed always cost less than what they wanted.
In the mining industry, you often see annual reports produced by the mining companies. It seems like almost all of these--or at least a great many of these new plants--they have start-up problems. The English call them teething problems. As far as I'm concerned, the start-up problems should never have happened in a properly designed plant. When the company has the press release or in their annual report, saying that they've had start-up problems, I think that all that is is a bunch of lies to cover up the mistakes they have made in building the plant itself, or operating it, or not training their people. It's lies to the stockholders and to the general public.
Swent:
You certainly hear it often enough.
Shoemaker:
You certainly do. And sometimes this will go on for a year or more than a year, some of the mistakes are so bad. Or they don't have the proper talent to run the mill or run the mine. But it's always very convenient for these companies to blame the engineering firms. But really, it's the owner's responsibility to watch after them, the engineering firms, to see that the engineering firm doesn't make any mistakes.
Proper design can only be done when you have complete cooperation between the client and the engineer because each has something to bring to the party. If an owner comes to an engineer and says, "Build me a plant," and then he goes away and says, "When you're finished with it, you come back and give it to us and we'll start it up," that plant is always a failure. And it happens. On the other hand, some clients--they walk into an engineering firm, and they dictate to the engineer where every nut and bolt and piece of equipment should be. An engineering firm that goes along with that, you get a lousy plant--again, a bad plant.
When you cooperate fully and have the right kind of people on both sides, then you get a successful plant. Just because Bechtel or Kvaerner or somebody else has a good name doesn't guarantee that you'll get a good plant because their best people may be tied up on other projects and you get ones that aren't experienced or don't have enough experience.
Swent:
Do you want to give some examples?
Shoemaker:
Well, a good example was the Carlin gold plant. Newmont came to us. They called for an appointment, and they brought their people out, and that was--when they arrived it was the first time we knew they wanted a gold plant.
Swent:
You had talked about this in the McQuiston interview.
Shoemaker:
That's a good example. We designed it, and we built it in ten months. But they had their people in our office all the time, including McQuiston and the rest of the people. They probably had six people there.
We had done the same with Gold Fields--that is, after I left Bechtel. Gold Fields would do exactly the same.
When I was at Bechtel, we built the Candelaria heap leaching operation for Occidental Petroleum--a silver heap leach, over in Nevada. We built that entirely, designed and constructed it, in eleven months. I was there at the start-up. I had had one of my people over there, checking out all of the equipment, training the people. It took us, from the time we pushed the first start button until the time we were producing a silver precipitate, just forty-seven minutes. It was operating up to full capacity in forty-seven minutes.
Swent:
That's phenomenal.
Shoemaker:
And ran, continued to run. That Candelaria operation was an interesting story. Armand Hammer decided that silver was worth going after. He told his people to find him a silver mine. Well, there was this old mining district at Candelaria over in Nevada, which was about fifty-some miles south of Hawthorne. They had some very rich ore there in the late 1800s and early 1900s. But the mining camp was all gone. There were only a few buildings that were made out of stone--houses--nothing big at all. It was just a ghost town.
Anyway, they started drilling that ore body and found out that it was a huge ore body. They came to us to do an engineering study on the heap leach. We finished the engineering study just about the time that the Hunt brothers started to corner the silver market. Armand Hammer got real smart, and he sold the production from this plant, which we hadn't even started--he sold it ahead, sold it forward for $40 per ounce.
Swent:
That takes courage.
Shoemaker:
We built the plant for $20 million, and then he had to buy the mining equipment, trucks, and so on. I think altogether he had $30 million in it. By the time we finished the engineering study, which was about ten months later, he unloaded his silver and made $130 million profit off of it before we even turned a shovelful of dirt.
Swent:
Ah! [laughter]
Shoemaker:
That was one of the more successful operations. But then again, it ran only about three years, and by that time silver was down to ten dollars an ounce, and they shut it down. Later on, some other people bought it and started it up again and expanded it and made it much bigger, made it produce much more. They ran it for another four or five years, and then finally they shut it down. That was a great success story.
Swent:
Yes!
Shoemaker:
Getting back to this client/engineer business, we did an engineering study for Amselco, which stands for American Selection Trust out of London. They were a big mining company in Zambia for many, many years. They're part of something else now, but this was Amselco. They were looking for gold. They went in with Occidental Minerals or Occidental Petroleum on a heap leach gold plant called Alligator Ridge over near Eureka, Nevada.
We did the study, and we finished it up along about the end of September. This is in 1975. We had a schedule showing that we could design and build this plant and have it started up in a year. They couldn't make up their mind. They would come to us and say, "Will you guarantee that you will finish the operation by next September?" Bechtel never guaranteed a damn thing under Steve, Sr. We always met our schedules, virtually always. I don't recall one that we ever overran in the mining and metals business. If something didn't work, we would fix it at our own expense if it was our fault. That's the way Steve, Sr., worked. They don't work like that any more.
But we wouldn't guarantee that that plant would be finished. They kept stalling around and stalling around. They would call me up and say, "Won't you guarantee this?" But anyway, finally came to us in December and said, "Can you still build it by September?"
Swent:
[chuckles] By then it was three months less.
Shoemaker:
We got together and we finally told them--we said, "We will try. We will do our best. We're not going to guarantee it, but we think we can do it. We won't have it all completed. There won't be doors and windows and things like that, but it will be operable." So they finally agreed that we could go ahead. We said, "We'll do this only on the basis that you make no major changes in the plant design after the second week of January." Oh, they swore up and down that they wouldn't make any changes. They finally made their last major change in July.
Swent:
Good heavens.
Shoemaker:
Unfortunately, Bechtel had started a non-union company called Longhorn Construction, down in Texas. Longhorn put in a bid, and they were the low bidder on the construction of this plant. Boy, they did a poor job, and we had a lot of trouble with them.
Swent:
And it was another branch of your own company.
Shoemaker:
Yes. We never let the Longhorn Construction bid on another one of our jobs. But anyway, we got it done, and we got it done by September. The biggest change that they made was that they had bought a used, portable crushing plant. It came in on wheels. The manager had bought it. The manager had been an ex-Kennecott man, working in Kennecott's mine at Ely [Nevada]. They were crushing ore to put on the heap leach pads while we were building the plant. That crushing plant kept breaking down. We spent just countless hours going over there and fixing it for them because they didn't have any maintenance crew to fix it.
Finally, the main steel beams that were supporting the plant--great big I-beams about two feet tall--they split right in two, and the plant fell down [chuckles]. It was just a horrible mess. They got us over there, and we jacked the thing up and welded those big beams together, and then put some quick-setting concrete underneath to support the middle of the plant. We told them, "Now, you can't run this for twenty-four hours."
Sure enough, they started it up after about twelve hours. Of course, the concrete wasn't set up, and it broke, and the support beams resting on the concrete--they went right into the ground, and then all the welds broke again. But anyway, we got the plant operating. Well, we got it in shape to operate.
Swent:
In nine months.
Shoemaker:
By the first of September the plant was operable although we were hanging doors and painting and so on--but they didn't want us to help them start the plant up. They had a fellow by the name of Roger Sawyer. He was an Englishman. He was their chief metallurgist. He was going to start the plant up by himself, with his people.
I happened to be in Denver about a month after they had started the plant up and I called up Roger. He had his office there in Denver, and I called him up and said, "I have a few hours before my plane," and asked him if he'd like me to come down and if he didn't mind, I would come down and talk with him. He said, "Yes, hurry on down. We're in real trouble." He says, "The electrolytic cells that produce the final gold product, they don't work."
I couldn't figure that out, so I went down to his office. We talked for--I missed my airplane, but we talked for a long time. Roger was scared to start the plant up. The first thing, he started the pumps that circulated the cyanide solution over the heap. He just kept recirculating it over the heap, and it kept building up in gold concentration. He must have circulated that stuff for--I don't know--a good two weeks. It built the solution up quite rich, much more so than the plant had been designed for.
And then he finally got up courage to put it through the carbon columns that adsorbed the gold onto the carbon--they call it a carbon-in-leach plant, rather than carbon-in-pulp plant, like Homestake has back in Lead. He loaded this carbon up, and he was scared to start the stripping section. He kept delaying that while he ran the solution through the carbon. Finally, he transferred carbon from three of the--I think there were seven columns. He transferred the carbon from all three, rather than the first column in the row. Well, he finally admitted to me that each ton of carbon that they got out of there contained a thousand ounces of gold per ton. The first column probably contained carbon with twelve hundred ounces of gold, and then the middle one was a thousand, and then the third one was, say, eight hundred. The feed to the stripping section should have been down around two hundred ounces at the very most.
Then he was afraid to start up the electrolytic circuit. Anyway, when he did strip this carbon, he got a solution that contained fifty ounces of gold per ton. Then he put that through the electrolytic cells, and the electrolytic cells were designed to take four-ounce-per-ton carbon. Well, the electrolytic cells were working fine because there were just so many watts going into the electrolytic cells. One watt would produce so much gold. He was putting in fifty-ounce solution, and he was getting forty-seven-ounce solution out of the cells. And he didn't think the cells were operating at all.
Finally, I got the whole story out of him. It was like pulling teeth. I finally said, "Roger, the trouble with your plant is that it's just completely constipated with gold. There is absolutely nothing wrong with those electrolytic cells."
He said, "Well, what will I do?"
And I said, "All I can tell you is that the plant is running perfectly, and you've just got to run it as fast as you can and strip as much gold as you can, and don't shut down the plant for anything because you've got to get rid of this gold that's plugging up the whole circuit." There was even gold plating out a quarter of an inch thick inside of the stripping vessels.
Swent:
Did they retrieve all of that eventually?
Shoemaker:
Oh, yes, they saved it all, yes. [laughter]
Swent:
We had a lunch break here, and now we're going to start on Washington Water Power, a coal washing plant.
Shoemaker:
Pacific Power and Light and Washington Water Power--both of them located up in Oregon and Washington--had Bechtel build them a power plant in Centralia, Washington. It was right next door to a large coal deposit, low-grade coal deposit. Bechtel had built the power plant, which burned 16,000 tons of coal a day. I don't recall how many megawatts it was, but it was a big plant.
Pacific Power and Light operated the power plant. Washington Water Power operated the mine and the coal washing or beneficiation plant. That plant was designed and constructed by Roberts and Schaeffer, who are coal washing plant experts. They're one of the two or three engineering construction firms that build coal washing plants.
Anyway, Bechtel got the power plant essentially finished. They were just doing things like painting and completing the punch list, we call it, of small items. The coal washing plant had started up, and the mine had started up. The mine was supposed to feed 20,000 tons per day of raw coal into the plant. The coal was low grade, and it contained large seams of kaolin clay. It was quite interesting because the kaolin was pure white, and the coal was black. Some of these seams were as much as three feet in thickness. That kaolin clay had to be removed in the washing plant. There was some rock in it, too, that was removed, but not very much.
Essentially, all of the difference between the 20,000 tons of raw coal and the 16,000 tons of washed coal was the 4,000 tons of kaolin clay. The trucks brought in the raw coal from the mine and dumped it into a toothed-roll crusher. And it crushed that stuff to about six inches maximum size, and then it went up along a conveyor to a concrete bin, which contained 6,000 tons of this raw coal. It was forty feet in diameter and about ninety feet high, a circular bin. There were feeders in the bottom of the bin that fed onto the conveyor that went to the washing plant.
The washing plant was very conventional. It had Baum jigs. These jigs are gravity separation devices, essentially a good-sized tank, with a conical bottom, a screen in the tank which raw coal is fed in on, and then there is water that is pulsated up and down through this screen by air pressure. It's a special jig only used on coal. They're a great big thing.
And that pulsating action makes the rock settle down on top of the screen, and the coal sits on top of the rock. And then the water is not only pulsating but it's flowing up through the coal, and it takes the clay off the top. So you have three products: the rock is bled off and sent out to a load-out bin; the slimes, which are a very dilute kaolin slurry--it was sent to a thickener, which is a large tank with rakes in the bottom, and there is flocculant added to that, which then makes the extreme fines clump together so that they settle rapidly, and then that settled material goes into a huge filter that takes the rest of the water out or most of the rest of the water, and makes a filter cake that joins with the rock in a load-out bin, where it loads into trucks, where it's taken back to the mine. And it replaces at least part of the coal that has been taken out of the mine.
And then the coal came out onto the--first it went into a dewatering device and went onto a conveyor--this conveyor was about three hundred feet long--where it would enter what was called a transfer tower. In this transfer tower, there was a flop gate and two conveyors exiting from this tower. One of the conveyors fed the coal to the power plant, and when the power plants bins were full the flop gate was shifted so that the coal would be diverted to a huge stockpile.
They made a great big conical pile, then they pushed it around with dozers and compacted it. They would try to have half a million tons of coal in the stockpile in case for some reason or other, the miners went on strike or the power plant was shut down. This coal had to be compacted because if it isn't, it will actually spontaneously start to burn. Every coal-fired power plant has one of these huge stockpiles.
It's interesting because the mine buys not just a ton of coal. They buy it by the BTU, British Thermal Unit. This coal that's in the stockpile, if it isn't compacted, it will actually burst into flames. But at the same time, it is still oxidizing. That oxidizing is causing heat, so you put a certain amount of BTUs into the pile but you never get all those BTUs out again because they've been going up in the air as heat. They constantly have to make an adjustment to the BTU content of the stockpile because it's decreasing all the time by itself. [chuckles]
Anyway, this power plant had, as I recall, eight boilers in it. These boilers are seventy-five feet high, probably, and they have these loops of pipe hanging from the top of the boiler roof. They put water through these pipes, which are these long loops that come clear to the bottom of the boiler. There are just masses of these pipes in there.
And then the coal comes in way at the top and goes into a bin for each boiler, and then it is fed out of the bin through feeders into a pulverizer, which is what we call a roller mill. It grinds the coal by steel rollers, and then they blow hot air through it so it dries the coal, pulverizes it, and then they blow the coal into the boiler, into the firebox, with air. It's just like a gas flame. It burns instantly.
So there are all kinds of mechanisms up there in that coal power plant. This big long conveyor that went from the transfer tower--it went up into the power plant, and then it fed two conveyors that fed two more conveyors that fed the two lines of surge bins and kept all of them full.
Any time they had any problem with all of this mechanical equipment up there, they had to stop this main feed belt to the power plant from the washing plant. Well, stopping this long conveyor and all these other conveyors up there--and the mechanical devices are all automatic--when one would stop, the previous machine or conveyor would stop and so on.
So this big long conveyor, which was probably eight or nine hundred feet long between the power plant and the transfer tower--it would stop. Then it would shut down the whole washing plant because at 16,000 tons a day, your coal can pile up on one of these stopping points just instantly and just create havoc.
Well, that was one of their problems. When the washing plant stopped, it would take them--in order to start it again, it would take two hours for it to get balanced out. In the meantime, it was producing very poor-grade coal. The coal was poor enough grade anyway. It was only 7,000 BTUs per ton, whereas normal bituminous coal is 12,000 BTUs per ton. That was one of the problems that they had. The other problem was that the flocculant wasn't working on the kaolin, and it wouldn't settle in the thickener. The thickener produced a very fluid slurry that couldn't be filtered very well, and the filter cake wouldn't be dry enough; it would just be a liquid. They would put it on this inclined conveyor, and it would run off the back end of the conveyor, and it was all over the ground outside the coal washing plant as much as four feet deep, this slurry.
What stuff they did get into this bin that loaded the trucks out with this rock and the so-called filter cake, it was just like hauling a whole truckload of water. It would just be splashing out all the way back to the mine, and by the time it got to the mine, it wouldn't be in the truck anymore.
Well, Pacific Power and Light was trying to make power. They were having so many interruptions, and this coal washing plant--they couldn't make it work. And Washington Water Power couldn't make it work. So Pacific Power and Light got kind of angry at Washington Water Power and told Washington Water Power they were going to have somebody from Bechtel to come up there. Of course, I know nothing about power plants, and I'm not a coal washing expert, but a mineral is a mineral, whether it is coal or something else. So I flew up to Portland and talked to the Pacific Power and Light people. They told me that my reception wouldn't be too pleasant because the Washington Water Power people didn't want to admit that they couldn't run this plant.
I talked to them for a day, and then I went on up to Centralia. It turned out that the construction superintendent for Roberts and Schaeffer was an old friend of mine from years and years before. He had operated all kinds of these washing plants, but he couldn't make this one operate. I talked to the vice president and general manager for Washington Water Power, and he wasn't very cooperative at all.
Well, I found what the two main problems were. The first one was this transfer tower. The simple solution to that was just put an electric operator on this flop gate so that as soon as the conveyor going to the power plant stopped, then the flop gate would automatically turn over and would not shut the coal washing plant down, but it would feed the coal out to the stockpile. Why no one thought of that before, I don't know. But it's very common in mineral processing plants to use these electrically operated flop gates.
But this problem of the kaolin not settling in the thickener and not being able to be filtered had just totally confused everybody. The Roberts and Schaeffer man didn't have the faintest idea what was going on, why he couldn't thicken and filter this material. The flocculant was costing five dollars per ton of kaolin, which translated to a dollar a ton of coal. So that was sixteen thousand dollars a day that they were spending for flocculant at a dollar a pound for the flocculant, and they were using one pound per ton of coal when they should have been only using five hundredths of a pound of flocculant or, in other words, a nickel's worth of flocculant. It was actually less than that. I'll have to do some arithmetic. But anyway, five hundredths of a pound per ton of kaolin that was settled, instead of five pounds per ton. The flocculant company was getting rich! They couldn't keep enough trucks full of flocculant coming in there.
So I studied that for a couple of days, and I looked over all the research work that had gone into it. There was nothing wrong with the research work that showed that this kaolin could be thickened and filtered. So I got some flocculant and took some of this clay over to the laboratory that they had there. I added the right amount of flocculant, and the stuff not only thickened but it filtered.
Well, the only thing--I was using water from the laboratory, and I didn't know where the water that fed the washing plant was coming from. So I went over to our construction superintendent at the power plant, and I asked him where that water was coming from. He said, it's coming from what they call the blow-down water from the boiler tubes. The inside of the boiler tubes get built up with scale. The only way they can get rid of it is to put trisodium phosphate--mix it in with the water that is periodically sent through those boiler tubes. This water is diverted and is not used for producing steam.
Shoemaker:
This water is sent out to a cooling tower because it's very hot, and it's just loaded with minerals that have been dissolved out from these miles of boiler tubes. There are literally miles of tubes in there. Then it is sent to a pond and allowed to settle and then they evaporate the water. That boiler tube water, the blow-down water, was being sent over to feed the coal washing plant. Trisodium phosphate is a very powerful dispersant for materials such as clay that has lots of fines in it. And here we are, trying to thicken this stuff, make all the particles clump together or flocculate--so one reagent was fighting the other reagent.
They were making poor coal, and it was costing them far too much. They were spending $16,000 a day for flocculant they didn't need. Well, I didn't go back to this vice president because he resented me coming up there and trying to figure out what was going wrong. So I went out to the washing plant superintendent and told him this and suggested that he connect the washing plant up to their fire system.
Swent:
This was the man that you already knew.
Shoemaker:
Yes. So we hooked a hose up to the fire hydrant outside, and that was fresh water. Within just, oh, forty-five minutes, the filters and the thickener were working just fine.
Well, then I had to go and tell the vice president what I had done. Altogether, I think I made four trips up there, and this was my last trip. I had to tell him what I had done, and he wasn't very--he just wasn't happy with me at all.
Anyway, before I left--I had been looking at this large concrete bin. They had installed what is called a Long Airdox system. Long is the name of a man. This system injects high-pressure air into bins or other places where material will not move. This air is at a pressure of about 2,000 pounds per square inch. When it is released all of a sudden through holes bored in this bin--it sounds like a cannon going off. It's supposed to shake everything up inside of the bin and loosen it up so that it will flow.
But with all this clay in there, it wouldn't come out of the bin very well. That's another one of the problems. It would just rat-hole, and they would get very little live load in that bin. The rest of it would just pack solid. They had a great number of these holes where this air was injected by a timer. I was looking at the bin, and I noticed that around each one of these pipes that went into the bin there were black marks radiating--little black marks, actually, jagged marks--radiating out from the area of this hole.
It looked to me like those were cracks and that there was black coal dust coming through the concrete to make these black marks that looked like a huge spider web, maybe eight feet in diameter. I was firmly convinced that those were cracks caused by that high-pressure air. Instead of loosening up the coal, the high pressure air was shattering the bin. So on my last visit, I went over to the vice president. I told him, "This is none of my business, but," I said, "I think that your bin is cracking. With all those spider web looking things, I think those spider webs are fine coal coming through with the moisture."
He just exploded. Told me it was none of my business, that I had no right to even bring it up, that there was nothing wrong with that bin, that those were just surface imperfections. He was so angry that he was yelling at me and cursing me. So I went back to San Francisco, and I told my boss, Bob Cheatham, about it. I said, "I think they're in trouble." He said it sounded like it to him, too. So he got some civil and structural engineers together, and three or four lawyers. We all had this meeting. The lawyers said that if we didn't write them a letter and formally tell them that we thought that bin was in danger of falling down, and if it did fall down, we could be held responsible--even though we didn't build it, didn't design it, or anything else.
Anyway, it finally ended up that I wrote a letter to this man. And this took a couple of days. I had to have it edited by the lawyers. Then I sent it off airmail, special delivery. It got up there, and he opened it the next morning, and this man, this vice president, opened it up and he saw that, and he called me up. It was at nine o'clock in the morning. He was yelling and screaming at me and saying that Bechtel would never get any business out of him, out of Washington Water Power, and accusing me of starting vicious rumors, and all that. Oh, he was so mad. He was going to get me fired. Finally, he hung up. That was at nine o'clock in the morning.
At ten o'clock, the bin fell down. [laughter]
And there wasn't a piece of that that was any bigger than your head. It was eight inches thick, and there wasn't a piece of it that was any bigger than that. It had reinforcing bars, you know, but it was just completely shattered. There was no more support. When it fell, it kind of opened up on one side, and all of this coal packed in there fluidized, just like a fluid, like a snow avalanche, looks solid but it flows like water.
This vice president had just bought a brand-new Buick. His office was in this building that was raised about four feet off the ground, and it was only about 150 feet away from that bin. There was a ramp for disabled people to go up the four feet in wheelchairs, and there was a steel two-inch pipe hand railing that came down the side of the ramp. It was three feet off the ground, and then it had the vertical pipe going into the ground right at the end of the ramp.
Well, his car was parked fifteen or twenty feet away from there, and that flow of coal picked up that car and pushed it against that hand railing and bent it right around the hand railing at ninety degrees. It didn't even bend the hand railing, it happened so quick. The car, of course, was just totaled. It was just bent in the middle, at right angles.
Swent:
Oh, good heavens.
Shoemaker:
That was at ten o'clock, just an hour after he hung up.
Swent:
The lawyers gave you good advice.
Shoemaker:
Yes. Well, I knew that the vice president should know about that. Even though I had saved them $16,000 a day in flocculant and saved them a lot of trouble with the plant being started and stopped all the time--it was stopping, oh, at least twice a day, sometimes four or five or six times a day. That was kind of a fitting punishment.
Swent:
Did anybody ever express any gratitude?
Shoemaker:
No, not a bit, not a bit. What they did, they left the bin out of there. They took all the concrete and steel off and just left the bottom of the bin there with the feeders under it, and then they just dropped the coal on there and had an open stockpile, which they should have had in the first place.
Anyway, the plant is still running.
Swent:
Good.
Shoemaker:
It's sure an enormous plant.
Swent:
Still producing power. Would that be enough for now, do you think?
Shoemaker:
Well, I've certainly got enough here for another session, I'll tell you that.
Swent:
It does look like it.
Shoemaker:
I want a section on scams.
Swent:
That's always interesting. I was interested in what you were talking about earlier, too, about working for an engineering company--and guess this is true of all of them. They don't have retirement plans and those kinds of things because they're hiring people for jobs and then letting them off.
Shoemaker:
They generally move around from one engineering firm to another. When one is up, the other one will be down--although sometimes they're all down, at times.
Swent:
You did say Bechtel had very good benefits to make up for not having a retirement plan.
Shoemaker:
Well, they paid well. To some of us, they paid extremely well.
Swent:
But it's an insecure kind of life, isn't it?
Shoemaker:
Yes, it is. But when I went out there to Bechtel, I didn't know anything about an engineering firm. I thought, well, I'll stay for a year and then if I don't like it, I'll go someplace and get a job with a mining company, in the West because I was born and raised here. Engineering gets in your blood, I guess. I stayed twenty years. There's something different all the time, and you like that.
Swent:
You can see what you're doing.
Shoemaker:
Yes.
Swent:
See the results.
Shoemaker:
That's why I liked Union Carbide Ore Company because there was something different--there were so many plants to look at and so many mines to look at, so many problems to solve. That's what's fun: solving problems.
Swent:
Yes.
Shoemaker:
[sound of papers] I've got a couple of more of these things. One was a little oil shale plant we built up in Colorado. There was a tower that was 200 feet high, and it started to lean. How we fixed that: we straightened it back up.
Then there was a head frame at a mine called Carr Fork, for Anaconda. Somebody else built it. It was a concrete head frame, and it started to lean. So they called us in. We were building the plant. We straightened that one up.
Swent:
A lot of what you were doing was mechanical engineering, actually, wasn't it?
Shoemaker:
Yes.
Swent:
You can't draw lines between these things always.
Shoemaker:
I never did any drafting myself, but I supervised draftsmen and supervised other engineers. This one--this oil shale thing--you have heard of the Tosco refinery?
Swent:
Yes.
Shoemaker:
You know what Tosco means?
Swent:
I guess not.
Shoemaker:
Swent:
Oh, really?
Shoemaker:
And they raised money to build this oil shale plant up in Colorado. It was the first experimental oil shale plant. Then Union Oil built one, too. They're both shut down now, but when they finally decided it was going to be too expensive to get oil out of shale, at that time, then they started buying up refineries and became a major player in the oil business.
We have more oil shale in the United States than Canada has tar sands in Canada, enough for--I don't know--thousands of years, maybe. But it's going to cost more than oil now, eleven dollars a ton.
Swent:
A barrel.
Shoemaker:
A barrel, I'm sorry [chuckles]. Anytime you build a plant, a mineral processing plant, the owner expects--say, you build one for 20,000 tons a day. The owner expects that he'll be able to get more out of that, maybe 15, 20 percent. Sometimes you get much more out. But when you build an oil refinery for 100,000 barrels a day, and it turns out that the refinery will produce, say, 103,000 barrels a day, the oil company can get highly irate. They feel they've been cheated [chuckles]. They didn't want a 103,000-barrel-a-day plant. They paid for 100,000 barrels, and you gave them one that's 103,000 and they think they paid for too much. Very strange.
Swent:
It's a different culture, the oil culture.
Shoemaker:
It certainly is, it certainly is.
Swent:
Very different.
Shoemaker:
If I keep on, I'm not going to be able to talk.
Swent:
Okay. Well, I think it's been a good day.
Shoemaker:
We can talk about Calaveras Cement.
Grant Metzger, who you know, was vice president of Calaveras Cement at the time I was at Bechtel. We were quite good friends. They, Calaveras, had Bechtel build them a new limestone grinding plant at a new quarry they opened up, up in Calaveras County, to feed their cement plant at San Andreas.
The job was given to the Los Angeles office of Bechtel. That was part of the Power and Industrial Division, which I was in at that time. They finished the plant. It was a crushing, grinding plant, and then they built a pipeline, and I think that pipeline was about--oh, about eight or ten miles long. The ground limestone was pumped over to their--
Swent:
Was it mixed with water?
Shoemaker:
Yes. It was pumped over to the plant at San Andreas. Then it was put into the rotary kilns to make cement. Anyway, the grinding plan wasn't working, so--
Swent:
What do you mean when you say it wasn't working?
Shoemaker:
It wouldn't produce a product that met the screen analysis specifications that it was supposed to, the size of the material. They had a large grinding mill. I don't recall what horsepower it was, but it was probably up around a thousand or fifteen hundred horsepower. There were some other things wrong with the plant. There were a good many things wrong with it. Calaveras Cement, for some reason or other--well, they hadn't put anyone in Bechtel's office down in Los Angeles to watch over the development of the drawings. Also the Bechtel people down there didn't know anything about grinding plants. How the plant got designed in Los Angeles, I never knew.
So Grant Metzger asked me if I would come up and take a look at the plant, which I did. I told my boss, Bob Cheatham, that he had asked me to do this, and Bob agreed that I should go up and take a look at the plant. There were a number of things wrong. The crushed limestone was put into a large building, storage building, and it had a conveyor underneath it and feeders that drew the limestone out of this large building and put it onto the conveyors going over to the grinding section of the plant.
They used the wrong type of feeders, and they didn't have the draw holes above the feeders designed properly, so they lost a lot of storage room.
Swent:
What's the difference between the wrong kind of feeders and the right kind of feeders?
Shoemaker:
Well, the first thing, they used vibrating feeders. Vibrating feeders are an electric vibrating device. Feeders, as far as I'm concerned, is a misnomer when applied to a vibrating feeder because there are so many things that control or have an effect on the rate of feed: the size consist of the rock, the moisture content of the material, any drop in voltage applied to the feeder, the condition of the feed pan itself--whether it gets rusty or whether it's smooth. I call them a vibrating, self-destroying erratic transport device sometimes. I hate them.
Swent:
[chuckles] I'm trying to--the thing that I can relate this to would be like a meat grinder or something. You've got a crusher and then you have a feeder that leads the stuff out of the crusher?
Shoemaker:
Out of the building where--it's stacked inside of the building by a conveyor along the top of the building.
Swent:
So it's feeding from a stack.
Shoemaker:
Well, a great big long pile. The vibrating feeder, itself, is a metal trough that is vibrated by what is actually called an armature. It's a series of iron plates with coils around them, and the 60-cycle current vibrates these plates. The plates then vibrate this pan, and it makes the material move down the length of the pan. They make very large ones and very small ones. But I hate them. Anyway, the worst problem that they had, though, was with the size consist of the material coming from the grinding mill.
Swent:
This is the second stage, then.
Shoemaker:
That's right. The material had been crushed to about a half an inch, a half or three-quarters of an inch before it went into the ball mill. And then the ball mill product went into a sump, where it was pumped to a cyclone. A cyclone is a conical device, where you pump a slurry into the top of the cone and there's actually a conical bottom to it and a straight section, tubular section on the top. The inlet is near the top. The slurry goes in tangentially. The coarser materials go to the sides of this conical section and then exit out the bottom, and the fine material goes out the top of the conical section. It's a very simple device. It was invented by a mining company called Dutch State Mines in Holland.
Krebs engineers took the idea and started building cyclones and examining the workings of a cyclone and improved them so much and became very famous for their cyclones.
Swent:
And I've just completed the oral history of Bob Clarkson, who was Krebs's partner.
Shoemaker:
Yes.
Swent:
He called it a hydrocyclone or a centriclone.
Shoemaker:
It's called a hydrocyclone. There are different trade names, like a Centriclone. But anyway, the product going out of the top of the cyclone was supposed to be the proper size for going into the pipeline, and the coarser material coming out of the bottom of the cyclone was returned to the grinding mill. But the overflow of the cyclone, the fine material, went over a vibrating screen to remove any tramp material, tramp oversize. The screen just was completely overloaded at times.
The problem was they had no level control on the cyclone feed sump, itself. The pump would suck the feed sump dry, and then part of the time the feed sump would be overflowing, and it was a terrible mess. Then, because of this--when the sump was being sucked dry, then the cyclone wouldn't perform, and the overflow would contain a large amount of coarse material, and then the screen would be overloaded, and they just had a terrible time. Well, it was easy enough to fix by putting in a level control.
The rest of the things that were wrong with the plant were relatively easy to fix. And so I wrote a report, and it was quite a long report. It was one that called a spade a spade. I sent it--in fact, I only made the one visit up there, and then the plant started to work. I wrote this report, and I sent it to Bob Cheatham. Cheatham sent it on to Ed Garbarini, who was a senior vice president of Bechtel at that time. Garbarini was a big, tall Italian fellow. I think he died. I'm not sure. Just recently.
And then Garbarini sent the report on to "Ike" Caracco. He was the vice president and in charge of the Los Angeles office. I didn't know that this had been sent on to Caracco. I was sitting at my desk at that time in the bullpen at 101 California Street, along with about fifty other people--draftsmen and engineers. Cheatham's secretary came running down from the second floor, where Cheatham had his office, and told me to get up to Cheatham's office as fast as I could. So I ran upstairs.
Cheatham was talking to Caracco, who had called him. Caracco was Italian, and he was in a towering rage. He was shouting and screaming and swearing that I had no right to go up to that plant, and I had no right to write a nasty report like that, and Caracco was going to have me fired and said that I would never get a job any other place, and he was just out of control. He was doing this over the speaker phone.
Finally, I guess he kind of ran out of breath, and he said, "What possessed you to write such a report?"
I said, "Mr. Caracco, I calls 'em like I sees 'em, and this was a lousy design on the part of the Los Angeles office."
And Cheatham put his hands together and held them up over his head, like this [demonstrating], and winked at me. He said, "Okay, Ike," he said. "You've said enough." He said, "I'll take care of it from here." Cheatham told me, "You won't hear any more from Caracco." He said, "I'll fix him."
That's kind of typical of some people and not necessarily in the engineering business, but they cannot take any criticism at all. Actually, that same type of attitude much later on caused me to leave Bechtel.
Swent:
About when was this, Bob?
Shoemaker:
Oh, that was in about the middle sixties. I guess that was when I was chief metallurgical engineer, so that would have been--I had an office at that time; I wasn't in the bullpen.
Shoemaker:
I mentioned in my memoirs that I had been in Russia twice. The first time I was there was when I went for Bechtel, and there were ten of us who went over and looked at various types of plants and apartment buildings and various civil engineering projects. The second time, I went over under the sponsorship of the Society of Mining Engineers. There were five of us, including Nat Arbiter, who I believe you know.
Swent:
Yes.
Shoemaker:
And two mining engineers and one geologist.
Swent:
Who were the others?
Shoemaker:
I would have to look that up. One came from the University of Minnesota, a mining engineer. One was from the Bureau of Mines.
Swent:
They were all Americans?
Shoemaker:
Yes. To sum up the whole trip, we didn't learn one single thing about metallurgy from the Russians because they were twenty-five years behind everyone else in the design of their equipment and the operation of their mineral processing plants.
Swent:
When was this?
Shoemaker:
That was in the seventies, early seventies.
Swent:
I think you wrote in your memoir that they were at least twenty years behind the times.
Shoemaker:
Yes. And they had at least two people on every single job because the Russians had no unemployment. They put everybody to work. So no one worked hard at all, and no one really cared whether they did a good job or not. They had no rubber-lined equipment, like rubber-lined pumps and pipelines and flotation cells. I've talked to a friend of mine recently, who has been over to Russia. He was the vice president of Newmont, and they put in a very large plant over there.
Swent:
Who was this?
Shoemaker:
Ken Brunk. He's not with Newmont any more; he's with Bateman Engineers. He tells me that they still have very little rubber-lined equipment, and equipment is almost impossible to get. You have to ship in everything. But because of this no rubber lining--
Swent:
Do you suppose because they have no good source of rubber, is that it?
Shoemaker:
I don't know. They certainly could buy rubber, but they have always had a shortage of hard currency, and so they couldn't--that's one of the things they didn't buy, just like activated carbon for recovering gold. They developed a process using ion-exchange resins instead of activated carbon. It wasn't nearly as good a process as the activated carbon--it had a number of drawbacks--but nobody really cared very much. Nobody cared with any of those plants because they didn't have any cost control. They didn't know what it cost them to produce a pound of copper or an ounce of gold. The management did not know. They just looked blank when you would ask them what their costs were. It was remarkable.
Consequently, their plants were always down for repair. The pumps were made of cast iron, which, pumping abrasive material, would only last a couple of days, whereas our rubber-lined pumps now--they're not really rubber; they're plastic-lined, plastic linings, much more advanced than rubber is, and will last for months or even years. But they didn't have that, either, of course. They were just constantly changing out pumps and pipelines and so on.
Shoemaker:
We went to one plant that was processing a lead-zinc ore. It was so low grade that it couldn't have possibly been operated any other place in the world except--I don't know--maybe China or some other place. It had a combined lead-zinc content of seven-tenths of 1 percent. Here, in the United States or Canada or most other places, lead-zinc plants have to have, oh, 7 or 8 percent combined lead and zinc, or even more. But they had put this plant in. It was back, oh, northeast of Tashkent. I've forgotten which of their--whether it's Kazakhstan or Uzbekistan.
But anyway, this big plant--it was nine thousand tons a day, and it was out just in nowhere. It was an underground mine. There wasn't anything near it at all. It was kind of on a sidehill, with a huge, huge valley out in front of them. This valley was all farms. The water that the farmers used came from the dewatering of the mine. They were pumping 60,000 gallons a minute out of that mine. Even then, sometimes they couldn't keep up with it, and the mine would flood. Sixty thousand gallons a minute is an enormous amount. Anyway, it all went down into the valley, where they had established these farms. The workers at the mine were living in dormitories. They were married people. I won't say dormitories, but apartments. They had dormitories for single people. But, of course, the apartments were one- or two-room apartments with one light bulb hanging from a wire in the ceiling of each room.
I asked the plant manager how much the farmers paid him for the water. He said, "Well, they don't pay anything. The water belongs to the government, to the state." They had to absorb all the cost of that.
But they were quite hospitable. The first time I was in Russia, they wouldn't let us take any pictures, but the second time, when they told us we couldn't take any pictures, well, even though Nat Arbiter was the leader of the group, I got up and I said, "Well, let's leave. We're going back home if we can't take any pictures." And there was a long, long argument back and forth between the Russians, and finally the KGB interpreter who we had there--anyway, we got them to agree that we could take any pictures we wanted. When we got back, when the CIA interviewed me, we found that no one else had ever been allowed to take any pictures. But those type of people at that time--you just had to be as hard-nosed as they are. \ But anyway, this KGB agent had mentioned that I had collected miners' lamps. They had a little museum there, and they went over to the museum and got one of their carbide lamps. They used electric lamps then in the mine. But he presented this to me, and they had it all painted up very nicely, and I still have it. Like most things over there, it was a copy of miners' lamps that were made in England or some other place.
Shoemaker:
We also went to the largest copper plant, which was called Almalyk. It was about fifty or seventy miles from Tashkent, in Kazakhstan. It was their largest and newest copper plant, and it was treating 80,000 tons a day. They were expanding it while we were there to 120,000 tons a day. Since they had no rubber-lined pumps, they couldn't use cyclones. In order to classify the ore that came out of the grinding mills, they used what we call spiral classifiers, which are a large--you might say a screw that works in an inclined trough. The mill discharge goes into the pool at the base, at the lower end of the screw, and the coarse material settles to the bottom of the screw, and then is conveyed back into the grinding mill. The overflow of the classifier then goes to flotation cells.
At that time, the largest mills that they had were 1,000 horsepower. At that time, we were installing 3,000-horsepower mills here in the United States and in other places in the world. But they didn't have the facilities for making these large mills and large gears and so on. They had two three-meter-diameter screw classifiers for each grinding mill. I wish I had measured or asked them how long that mill was, but I think it must have been a third of a mile because you would have two of these huge classifiers beside each one of these grinding mills. If we had had the same capacity mill, it would have been one-third the size of their grinding plant.
Their primary crushers were very strange. The largest gyratory crusher they had was what was called a 50 x 60 inch. That was in metric system, though. They couldn't put very large rocks into it because of the 50-inch opening. Our 60-inch--well, our crushers at that time were 60 x 89 inches, and also we had a 60 x 102 inches. The second number is the diameter of the mantle in the crusher. But these had 600 horsepower on them, but they had two motors driving the thing, one on either side of the ring gear at the base of the crusher. \ I asked them why they used two motors instead of one, one 600-horsepower motor. And they said it was because they couldn't get gears that would take the shock of a single 600-horsepower motor on a crusher. The gears were just--the metallurgy in them was not good enough to take the shock of the crusher.
Swent:
So they were just limited by their own technology.
Shoemaker:
That's right.
The best engineers that they had were all working on their space program and their armaments industry and the aircraft industry. Although the aircraft weren't--they had one of the worst the worst safety record in the world. While we were there, they had built a copy of the Boeing 727, and on its first flight--this KGB agent, who was our interpreter, told us that when they took it off, it went straight up in the air and then turned over on its back and crashed. Their bigger jet airplane had four jet engines. Those were built on the tail, like the British VC-10; it was a copy of that.
The Russian people--they're not very smart. The bureaucracy is just too set in their ways, and they won't be able to change overnight, much less in ten or even twenty or thirty years. I was talking about that with Ken Brunk yesterday on the telephone, and he agreed with me completely on that, with his experience over there. He says there's a lot of mining companies that are investing over in Russia now, and he said they produce reports that say their costs are quite low, but he says they're lying. Their costs are probably as high or higher than what they are in the United States. He says they're all trying to justify themselves to their stockholders.
Shoemaker:
Another country that is terrible to operate in, even far worse than Russia, is the Congo. That country has enormously rich copper and cobalt mines.
Swent:
Were you ever there?
Shoemaker:
I've never been in the Congo. Well, I flew into the airport there at the capital one time. But I was in Zambia, just about five miles away from the Congo border, for Anglo-American one time. We flew into a small gravel airstrip. We were looking at a mine that had been shut down. I was with Bechtel at that time. It was an underground mine. They thought it was the Queen of Sheba's mine. The outcrop had little veins of copper or oxide material going through it. They were mined down about thirty feet. They must have had children down in there excavating because it was too narrow for a normal-sized person.
But anyway, we had to get out of there before the evening because the rebels from the Congo were coming across the border and raiding. But the Congo--the Belgians had very large copper mines and cobalt mines there, and when the Belgians gave the independence to the Congo, there were several factions that were fighting to take it over and take over power, and those mines had to be abandoned.
Now one of the big oil companies--I think it was Exxon-- tried to go back in there a number of years ago and spent hundreds and hundreds of millions of dollars to start up a new plant. Before they got it halfway finished, the rebels came in and killed a bunch of the people, and they finally just pulled out. Now there's another company, a Canadian company, going in there. I've heard that--it's been in The Northern Miner [newspaper] that the newest or latest government has revoked their license to mine after spending, again, hundreds of millions of dollars.
Shoemaker:
Another one of these countries is Indonesia. When a mining company goes in there, they have to give one of the Suharto family members from 10 to 20 percent of their operation. Newmont is in there with one of the big copper mines of the world that just opened up. Of course, Freeport has been in there with their mine in Irian Jaya, which is the northern part of New Guinea. Oil companies are in Indonesia. But the Suharto family is so enormously rich from all of these things that it's just a crime, when the people are just poverty-stricken.
Swent:
Were you in Indonesia at all?
Shoemaker:
I've never been in Indonesia, itself. I've been in Singapore and Hong Kong and, of course, New Guinea and the islands there, but I have no desire to go to Indonesia. Newmont built a big heap-leach operation at the Murantau mine in Russia. That's the one I described, I think, in my memoirs, where the CIA had photographs of it and wanted to know how big it was.
Well, anyway, the Russians over the years had stockpiled enormous quantities of low-grade material, and Newmont has gone in there and put in a very large heap-leach. They have to crush all their ore to a quarter of an inch. They have four-stage crushing, and it was high cost. They had to fly every single piece of equipment in from Texas. They use a Canadian company that leases these very large cargo planes from Russia, jet cargo planes. They're bigger than one of these C-5As that are made by Lockheed. They are leasing these--I think they're Antinovs. Anyway, they advertise in the mining journals. They use them to ship large pieces of equipment overseas, all kinds of equipment. That's a good airplane. But Newmont is not going to make enough money out of that thing, I don't think, to ever really give a good return to their stockholders.
Shoemaker:
When I was at Bechtel, also we built the Candelaria silver heap-leach plant for Occidental Petroleum, or Occidental Minerals, which was a subsidiary of Occidental Petroleum. This was in 1980 that we built the plant. Armand Hammer became interested in silver, and he made Paul Bailly the president of Occidental Minerals. They started looking for large, low-grade deposits at Candelaria, which is about fifty-five miles south of Hawthorne, Nevada. It was an old mining camp. It was very rich for a good many years, back around the turn of the century.
It didn't have any water at that time, and they brought their water through a fourteen-mile gravity pipeline from the mountains up to the west. This pipe--we uncovered a lot of it when we built the plant. It was a spiral, riveted pipe, four inches in diameter. It was made out of wrought iron. Wrought iron doesn't rust at all, and it was just as good as when it had been laid back around in the late 1890s. Candelaria--they cut that pipe up and made a lot of claim posts out of it.
But it was interesting because we did a study for them, an engineering study, and we projected the cost of producing silver from this mine to be five dollars an ounce. The capital cost of the mine would be about $30 million. Before we even moved one shovelful of dirt to start building the plant, Armand Hammer and Occidental Petroleum--they sold forward 6.3 million ounces of silver. This was at the time when T. Boone Pickens was trying to corner the silver market, and they sold this forward at forty dollars an ounce.
And then the silver market--it reached fifty dollars, and then it started to collapse. Armand Hammer sold the 6.3 million ounces and made a profit of $130 million.
Swent:
Oh, my.
Shoemaker:
Before we had even started building the plant.
Swent:
A $30 million plant.
Shoemaker:
Yes. They made $130 million profit. So he made $100 million net.
Swent:
Before he had even built it.
Shoemaker:
He was pretty smart. He's one of the few gamblers in silver that have ever made any money. The plant ran for about two years, and when silver dropped to seven dollars an ounce, then they shut it down. It was shut down for a couple of years, and then Nerco bought it. Nerco was a company that Pacific Power & Light bought. PP&L wanted Nerco because Nerco had a lot of coal properties in Alaska and also here in the United States.
Swent:
Texas, too, isn't it? Or Wyoming?
Shoemaker:
Wyoming and Montana, I think. But anyway, they got this silver property along with it.
Swent:
They did produce the six million ounces?
Shoemaker:
Oh, yes, yes. Well, they wouldn't even have had to. They could have just bought silver for five dollars on the spot market and sold it. Because it was sold forward, they would have gotten the forty dollars an ounce. But many, many years ago, the government told the public utility companies that they had to agree not to get into the mining of precious metals. Now, I don't know why. But PP&L and New Mexico Power and Light never did sign that agreement. And so Nerco, under PP&L, got interested in silver and gold. I guess Pacific Power thought they were going to make a lot of money, and New Mexico did, too.
Anyway, Nerco bought the Candelaria property and then ran it for about four years, and then they expanded it and got bigger trucks and put bigger throughput through it. They made some money, but then, when the price of silver fell again, even with their increased production and lower operating costs, they couldn't make it and so they shut it down.
The New Mexico Power and Light bought a little company called Transwestern. They were a promotional company. They, Transwestern, leased the 16-to-1 Mine up here at Alleghany and lost an enormous amount of money. They also leased a gold deposit up in northern California. It was a heap-leach operation, and it had quite a good-sized cyanide spill. The state shut them down, and I was hired by the owner to go up there and see if--they had filed a lawsuit against Transwestern, saying the place had been run incompetently.
So I went up, and I spent a week up there with the lawyers. And it was. It was a terrible operation. It was up by Lake Almanor, I think it is, up north, north of Quincy. I spent a week up there, going through all of the records, and it was just a disaster. Finally, it didn't go to court. I recommended that it was such a mess that they would probably spend so much money in court that it wouldn't be worth it, and I recommended that they settle for--I've forgotten--it was a few hundred thousand dollars. Which they did.
Shoemaker:
Later, getting back to Occidental and Candelaria, there was a man by the name of Von Kohorn. I think his first name was Henry. I don't know where he came from, but he apparently got interested in heap-leaching, and this was in the early days of heap-leaching. He got a patent on a method of making the leach-heap more permeable after it had gotten blinded off by the decomposition of the ore that sat there over the years. His way of doing this, restoring the permeability of the leach-heap, was to--before they were built--bury six-foot diameter pipes at the bottom of the leach-heaps, and then pull these pipes out of the heap, after the permeability was lost. Pulling these pipes out--the ore would fall into these spaces. [chuckles]
So he went to Occidental and said that they had stolen his idea, which they hadn't. In the first place, the idea wouldn't work because it would have taken a battleship the size of the Missouri to pull those huge pipes out of there. But they had to answer the lawsuit, so I was called in and gave a deposition. Anyway, Von Kohorn faded away.
But then there were two companies that had been dormant for years that owned the deposit there at Candelaria. One was called Candelaria Industries, and the other one was called--I think it was Candelaria Mining. These people, the stockholders had had this stock from many, many years ago. Occidental negotiated leases with them. Their claims abutted each other. This one company, Candelaria Industries sued because they claimed that Occidental was doing their assaying poorly and that their mining practice was poor.
Where these claims abutted each other, this company said --you see, you have to do some drilling and some assaying and calculate how much ore goes to the royalty on one side of the line goes to this one company, and the ore on the other side goes to the other one. But you can't mine a vertical face, and so you have to do all this by calculation from drilling and assaying. The metallurgist there had developed a complex but very good method of doing this calculation of paying royalties.
Anyway, I was hired by Occidental to be an expert witness in this lawsuit. It was interesting because one of the stockholders, major stockholders in this company that was doing the suing was the wife of Judge Wapner, the "People's Court" judge. Also, my professor of metallurgy at the University of Wisconsin was an expert witness for this Candaleria Industries. He shouldn't have ever taken the job because he had to testify about assaying, and he never had done any fire assaying. I had, and it was--this man's name was Dwight Harris. He's dead now. Our lawyers just went after him and made it very embarrassing for him.
Anyway, we finally prevailed in the suit. That was later, when I became a consultant, but I bring it in here because we built Candelaria, which was one of the two silver heap-leaching operations--well, actually, one of the three. One of the others was the one that Frank McQuiston, Ed Hewitt, and I had over at Tuscarora, and that third one was down in Tombstone, Arizona.
Swent:
When you say you build a heap-leach plant, do you mean the crushing plant?
Shoemaker:
Well, it's a crushing plant, and then the materials handling facilities--sometimes conveyors, sometimes truck--to build the heaps, and then you build all the piping to distribute the cyanide solution and the ponds to collect the solution and then the recovery plant. With silver, you use a zinc precipitation plant, which used to be used for gold also. Nowadays, you use activated carbon to recover gold, rather than zinc precipitation.
Shoemaker:
When I left Bechtel in January of 1981, Bechtel had changed their policies. They had brought in a bunch of people to run the Mining and Metals Division, which had become very large. Many years before, it had broken off from the Power and Industrial Division, and we actually became larger than the Power and Industrial Division. I ended up, when I left, as the manager of the Division of Metallurgy, and I had charge of all the metallurgical plant designs for the San Francisco, Toronto, and Melbourne offices.
But it wasn't like working for them when I first was with Bechtel and for a good many years when Steve, Sr., was there. If we did something wrong when Steve, Sr., was there--if we built something wrong in a plant--we fixed it at our own expense. That's why we became so large. We had such a fine reputation. But when Steve, Jr., came in, well, that gradually changed as the old-time board of directors finally died off or retired. It became a company that was very arrogant, and I just couldn't take that.
Shoemaker:
Anyway, when I left, I moved into the Russ Building over on Montgomery Street, with Henry Colen and Joe Wargo. They had an extra office there, and they were subleasing from Consolidated Placer Dredging. One of my very first jobs--and the only one that I ever got beat out of a fee on--happened shortly after I moved in with Joe and Henry. They called me vice president of San Francisco Mining Associates, but I really wasn't. I was operating under R.S. Shoemaker:, Limited, my own corporation.
But I got a call one day from a man by the name of John J. McCloy, Jr. John J. McCloy, Sr., was the high commissioner in Germany after World War II. He lived in New York, and he said that he was interested in a proposed gold mine, a gold deposit, out in Arizona, and he was in partnership with a man by the name of John J.--
Shoemaker:
With John J. McCoy.
Swent:
John J. McCloy and John J. McCoy! How confusing!
Shoemaker:
McCoy was president of Coastal States Gas, which is a big gas company. McCloy asked me if I would come to New York and talk to him about it. He wanted to hire me. I was working for DuPont, and I had to go back to Wilmington, and to get to Wilmington, Delaware, I had to go to New York. I said, "Well, I'm coming back there, to Wilmington, and I can stop in New York and come and see you and you can share in the cost of the air fare."
He said, "Fine."
So I did. I flew to New York and stayed at a hotel and went to see him. He had an office in Radio City, Rockefeller Center. They were both there. They had a bunch of papers there. It was obviously a scam. But they, like so many people who are involved in these scams, they--even though they were supposedly bright people, they knew more than anybody else, and they were bound and determined to invest in this property. I spent the whole day with them and finally convinced them that they shouldn't go into this because--
Swent:
What made it so obvious to you that it was a scam?
Shoemaker:
The first thing: anytime anybody mentions platinum and platinum metals here in the United States, you know it's a scam. But all of these scams or most of these scams--they generally have an ore deposit that contains platinum and palladium and other rare elements besides gold. [chuckles] Or they will claim they will make a concentrate, a copper concentrate. Well, they sell the copper, they sell the sulfur, they sell the silica that's in it, they sell the limestone that's in it, and they add all of these things up at market price, and it's very apparent that it's a scam, whereas all of these things should go into the tailings.
Well, anyway, I sent them a bill, and McCloy refused to pay for it. I went to my attorney, and he said, "You've lost the money. There's no use trying to sue him in New York. You would have to hire a New York lawyer and so on." From then on, whenever I didn't know anybody, I always asked for a retainer in advance.
Shoemaker:
Another interesting job that I had, when I was with San Francisco Mining Associates, was for the New Guinea government. At that time, Gold Fields of Australia, which was a subsidiary of Gold Fields of South Africa--well, Gold Fields of London--they had been jointly exploring with Placer Development the Porgera deposit, up in the highlands of New Guinea. You had to fly into Port Moresby and then get a little plane into Lae and then Mt. Hagen; then we got a chartered plane up into the mountains, where this deposit was. We flew in on a plane owned by a mission. It was used to bring supplies to these various places, little towns that had missions.
What we were looking at was--the government wanted us to see the drilling that the companies were doing and they were planning on doing and what the ore looked like and whether it could be beneficiated properly and whether the test work was being properly done--
Swent:
This was gold?
Shoemaker:
Gold. When we flew into this mine, it was remarkable because the airstrip was on a 15-percent slope. You came up the Brunswick Hill down here. That is a 9.5-percent slope. This was 15. The pilot came in at the bottom of the hill, the airstrip, and as soon as his wheels touched down, he applied full power because if he ever got stopped at the bottom or anywhere near the bottom, he couldn't get the airplane to get up to the top of the hill. They would have to tow it up there. So by applying full power, he got it up to the top of the airstrip. Then, of course, he took off downhill. I don't know whether any airstrip in the world has ever been any steeper than that, but that was certainly a steep one.
We stayed with the exploration crews that were there for both Placer Development and Gold Fields.
Swent:
How did you happen to get this job from the government? Did you have contacts?
Shoemaker:
The New Guinea government was using a bank here in the United States called Mace Wespac, Western Pacific. It's an Australian bank, and it had a New York office. They had asked the bank to look up some people who could look at both geology and metallurgy, to check on the lessees of the property, and so they called us up.
We were up there for several days, Joe and I. First we went to Australia and talked to Gold Fields. Then we went to Port Moresby to the Ministry of Mines. The minister was, of course, an indigene. You don't call them natives any more; you call them indigenes. While we were there, we visited the parliament when it was in session. There was probably fifty people there in the parliament building, which is a nice, modern building, very nicely designed. About half of the people in the parliament were dressed in suits, and the other half were dressed in their very best native costumes, with feathers and everything. It was quite a sight.
We also visited their museum, a natural history museum, which was absolutely fantastic. It was not big, but it was done so nicely.
Oh, the name of that place was Mt. Hagen, where we landed after we left Lae.
Swent:
How do you spell Lae?
Shoemaker:
L-a-e, I believe it is. It's on the map.
There was an Australian up at the site who had gotten a license to mine up there. They had been mining gold up there for many, many years, and he lived in a house. It was a big house. It was the only house at the site. He was about a mile away from the site. The house was all kind of moldy and about ready to fall down, but it must have had six or eight bedrooms in it, none of which he used except one, I guess.
He employed a number of these indigenes to run a sluicing operation. There was coarse gold up there. He also bought gold from the indigenes that had their own little spots. We visited with him, and he showed us all of the different kinds of gold. Every spot there has a different characteristic. You could very easily tell where it came from.
Anyway, we turned in a report to them and said that they were doing very well, and they were getting their money's worth--the government would be getting their money's worth. It later turned out Placer Development bought out Gold Fields, and they have been operating that thing, and it has been one of the richest gold mines in the world. They ran into some enormously high-grade ore there at Porgera. The name of the mine is Porgera.
Shoemaker:
Oh, going back a minute to scams. I have a section on scams in the back. Let me talk about this one. I got a call from a man by the name of Burt Applegath. He was a Canadian promoter, mine promoter. He's one of these nonstop talkers. Anyway, he asked me to come down to El Paso. They were in partnership with a company called New Cinch Uranium, which was a reputable uranium company up in Canada. It was on a gold property in New Mexico. It wasn't a very long distance from El Paso, probably fifty miles. Well, I never heard of Applegath and never heard of New Cinch Uranium. He said they were doing some drilling there, and he wanted me to check into the assaying and the sampling.
So I told him I had had this experience with McCloy, and I told him I'd have to have a retainer, and he said that he would meet the airplane at El Paso with a cashier's check, which he did.
Then we went up to the site where they were doing the drilling, and then we went to the assay laboratory, which was in El Paso. They were getting such rich values there. I just had the feeling that, with these great assays they were getting, I should be seeing some gold there, visible gold. I borrowed a bucket and used it for a gold pan when I was up there. It's very crude, but it can be done. At least you can see the larger pieces of gold. I couldn't find any gold. But I didn't say anything to them about it at that time.
Then we went down to this laboratory, and this fellow had, oh, kind of a general water-chemistry laboratory, and he had a fire-assaying laboratory. He had a man from Asarco who had been an assayer for Asarco, who I'm sure was honest, but this man who ran the laboratory was also buying electronic scrap. He had almost a washing machine that he would put these things in. It looked like one of these old Westinghouse horizontal-drum washing machines. He had made it out of stainless steel, and he was cyaniding this stuff, all the gold from the electronics. He was pouring gold there, and he was pouring little gold ingots right on the same table where they were mixing the fluxes for the fire-assaying.
Well, it was very apparent to me that the assays were being salted. Whether they were being salted on purpose or whether it was just from accidental contact with metallic gold there, I don't know. But anyway, I told them to change laboratories, which they did. And then they began getting nothing.
Actually, I was working for New Cinch Uranium. They were paying my bill. When they started going to another laboratory, they got absolutely nothing, and they closed the project down. As I say, I never figured out whether it was a complete scam, as far as the laboratory was concerned, or whether it was completely by accident.
Swent:
Okay, we've taken a short break here, and now you were just talking about Timothy Collins and a company called United Mining that was going to open the mines at Virginia City, Nevada.
Shoemaker:
Right. First of all, Howard Hughes wanted to get involved in mining in Nevada. One of his employees that he put in charge--he just told him to go buy mines. This man bought a large number of claims all over Nevada, where old mines had been and were defunct. One of the properties he bought was in Virginia City--actually, at Gold Hill. But then, when he died--Howard Hughes died--all of these properties were purchased by an outfit called Houston Oil and Minerals. They were trying to operate a plant there, between--well, it was closer to Virginia City than it was Gold Hill. They were developing an open pit there. They had brought a mill down from Canada. They had wooden ore bins that they brought down. They got one of them re-erected, and then it collapsed, the lumber was so bad. So then they put in some steel ore bins.
They had six wooden Pachuca tanks. A Pachuca tank is a large, tall, cylindrical tank where you do your cyanidation, and you keep them agitated with air going into the bottom of the tank. Pachucas were used at the Homestake uranium mill there, near Grants, New Mexico. These were leaking all the time. It's a wonder they even stood up. I went through the mill when I was there. It was a very poorly designed mill.
I'll get back to that in a minute, but Collins had hired a very fine tunneling engineer. They sank a decline down--oh, the entrance to it was probably three blocks or more down the hill from the main street of Virginia City, and it went down at about a ten-degree angle and went through the vein structure, which was right underneath the main street of Virginia City.
They had a lot of problems. They had to timber all the way down, the ground was so loose--running, as we call it. They timbered all the way, and then they got through the vein, which had been mined out--or--they had been mining up to within about three hundred feet of the street in the middle of town. And then they had turned both right and left when they got through this vein and mined-out portion of the vein, and drove a short adit to the right. I don't know which direction that is, but I would presume east, and a much longer adit right under the main street, right in line with the main street, clear to the end of town, the west end of town, and then drove cross-cuts back into the old workings. These workings were all square-set stopes. You couldn't get in--you could look in, but you didn't dare go into these because the timbers were all crushed.
Swent:
They were there from a hundred years ago, I suppose, weren't they?
Shoemaker:
Yes. We went down--Joe Wargo and I--and Henry--we all three went down in that mine--or--it wasn't a mine yet. We did quite a study for him. He was doing metallurgical work, or having it done, and I supervised that. He was selling some of the material that he took out of this adit to Houston Oil.
Swent:
Now, "he" is Collins?
Shoemaker:
Collins. Selling it or having it custom-milled in the Houston Oil mill, and had plans on taking it over. We were over there several times and I wrote quite a long report about it. We weren't really enthusiastic about it at all because Joe particularly thought the ore was--there wasn't much ore. They were going to mine up toward the street! Because those mines, you know, had been very deep, a couple of thousand or three thousand feet, they were essentially worked out. The only good ore was up near the street, and you couldn't get too close to that or the whole town would cave in. Well, anyway, Collins ran out of money and he didn't pay us, and we had to sue him to get paid.
But in the meantime, the Houston Oil people wanted me to come over and help them with their mill. They had a very good mill superintendent by the name of Bob Turner, who I later got hired to go up to the Pegasus Gold Landusky-Zortman in Montana. I was helping out Bob, getting this old plant straightened out. It was an interesting job, but it was kind of frustrating because you knew--or I knew--they weren't going to last very long. They had tried to open up the old Sutro tunnel that was supposed to drain all the water from the Virginia City workings. But most of the tunnel had collapsed, and they never could get back in there. Houston was another one that was going to make a fortune. They finally went under. But it was an interesting time, working in that old mill that had been rebuilt. I enjoyed it.
Shoemaker:
Another job when I was still in San Francisco was--I have a friend up here in Grass Valley by the name of Dale Corman. He is a geologist and a mining engineer. At the present time, he is president of Western Copper Holdings. They have a very large copper deposit that they have found in Mexico. At that time, they were interested in geothermal power. They had geothermal claims over in Nevada. They had sold one of them, or leased it, to Chevron, to run a geothermal power plant this side of Carlin.
Anyway, he called me up one day, and he said, "Why is Homestake looking for pyrite?" This was when they were planning on building the McLaughlin Mine.
I said, "Well, I have to think about it a little bit." They were going to use autoclaves, Homestake was, at the McLaughlin Mine to oxidize the pyrite that most of the gold was entrapped in. The sulfur --and they had pyrite in their ore--and the sulfur furnishes the heat in the autoclave.
But when I thought about it, I said, "Homestake probably thinks they don't have enough sulfur to furnish enough heat because I do know that they are putting in boilers over there to furnish high-temperature steam."
He said they had been prospecting all over California and clear up into Oregon for any old prospects, old mines or even new ones, that were high-grade pyrite. He said, "They've been doing this for about a year and a half, and have spent a lot of money doing it." I said, "Well, undoubtedly, they think they need the sulfur."
He said, "Well, I know where there's 40,000 tons of pyrite--not only pyrite, but it contains a quarter of an ounce of gold. It is at the Empire Mine here in Grass Valley." This pyrite concentrate was an idea of Frank McQuiston's, when he was chief metallurgist here. They had made a flotation concentrate which--originally, at Empire, they cyanided all of the ore, but then when flotation came in, in the 1920s, they produced a flotation concentrate which they cyanided. But part of the gold was associated with galena, which is lead sulfide, and part of the gold was in the pyrite.
Frank put in a circuit to separate the galena from the pyrite, and they made a high-grade galena-gold concentrate, which they sold to the Selby Smelter. To do that, they had to put in a fine-grinding circuit before the flotation. Then the remaining leached pyrite was put in a separate tailings pond from the old tailings that they had made there ever since the 1920s. This pyrite had actually been drilled by the Bureau of Mines. The Bureau of Mines had done some assaying. They had not written a report about it yet.
Shoemaker:
He told me that the state, which owned the Empire Mine Park, had given the Empire Mine Association the right to sell this concentrate. He found out that they had been talking with White Pine Copper up in Michigan about this because White Pine bought pyrite because their concentrates were very low in sulfur, and they couldn't make a copper matte in their furnaces, so they had to buy pyrite. They had native copper as well as covalite, which is CuS. So it was very high in copper and low in sulfur. Anyway, the Empire Mine Association figured there was no way that they were going to ship that stuff all the way back to Upper Michigan.
My friend Corman talked with the board of directors of the Empire Mine Association, which runs all the docents over there and helps rebuild buildings and so on, and found that this concentrate was for sale. He said, "Do you know anybody in Homestake?" Then I told him about Homestake probably wanting the sulfur from the pyrite, and I said, "Yes, I do."
He said, "Why don't you call them up and see if they're interested, and don't tell them where it is."
So I called--I'm trying to remember the name of the fellow. He was their chief geologist that quit or was fired--I'm not sure which.
Swent:
Anderson? Jim Anderson?
Shoemaker:
Jim Anderson. Well, I had called--who was the president at that time?
Swent:
Henshaw?
Shoemaker:
No, after Henshaw.
Swent:
Conger?
Shoemaker:
Conger.
I called up Conger, Harry Conger, and told him--I said, "I heard that you're interested in pyrite. My partner and I know where there is some. Would you be interested in it?"
He said, "We might be. Why don't you come over and talk with Anderson?" So Dale Corman--he came down, and we set up a meeting with them, and he came down from Grass Valley, and we met over there. We told him that we had this 40,000 tons of pyrite that was pretty much, theoretically, pure pyrite, was almost pure pyrite, but it contained a quarter of an ounce of gold, and that made their ears prick up pretty well.
Oh, we met with--I don't know whether you want to use names or not--
Swent:
Sure. That's the whole point of this.
Shoemaker:
We met with Anderson, and we met with Rex Guinivere. He was chief engineer. Why he was in on it, I don't know. And then there was a purchasing agent, and I don't recall his name. And then they had a corporate attorney. He later quit and he went to work for the navy. Relatively young fellow. I think he was probably thirty-five or something like that. There were four of them.
And so we discussed this. One of them asked where it was, and the attorney said, "Don't ask that." So we didn't tell them. We wouldn't have told them that time, anyway. They wanted some samples, so we got them some samples, and I took them over to them. Dale sent them down to me. They had them assayed, and they called up and asked for another meeting. Dale came down, and they said that they were interested in purchasing and how much would we want for it?
This work had been going on--or this contact with White Pine Copper had been going on, and we were afraid the word about Homestake would get out to these Empire Mine Association people. So we agreed together to--Dale and I--to tell them at that meeting where it was, because that would then kind of commit them. Anyway, they asked first what we wanted for it.
We had set a figure of thirty-five dollars a ton. Well, at that time, gold was $400 [an ounce].
Swent:
A quarter of an ounce would have been $100.
Shoemaker:
A quarter of an ounce would have been $100, plus the value of the sulfur. Actually, they wanted the sulfur, but they wanted the gold also when they found out it was there. Well, we figured to mine it, which would require a front-end loader, and transport it, we had a figure of fifteen dollars a ton. We would pay the Association ten dollars a ton, and we would get ten dollars a ton. We told them that, and they were, of course, very much interested.
Then we said, "Well, we have the rights. We've been talking--we have been given the verbal rights to sell this, to purchase this stuff." We said, "It is at Grass Valley at the old Empire Mine." The lawyer didn't want us to tell, but we got it in before he could shut us up. Well, then they wrote up a contract. They sent it to us, and we had one other meeting. We made some minor changes to the contract. And then they said, "Well, we're not sure we need this at the present time. We'll have to get the mill started before we really know whether we need this or not."
We said, "Well, why don't we just make a handshake agreement that you will buy this through us, since we brought it to your attention?" They asked the lawyer about it, and the lawyer said that's all right, and so we shook hands all around --shook hands with the four of them. And they said they would call us when they found out if they needed it or not.
A few months later--it was eight months or so, when the plant was built, Dale called me up one day, and he said, "They're mining this stuff, this pyrite." He said, "The Empire Mine Association has made this deal with a contractor from Seattle," someplace up in Washington, to haul this. He bought it, and was hauling it down to Lower Lake there, to the McLaughlin Mine. By that time, Bill Humphrey had come to work for Homestake, so I called up Bill.
I said, "Bill,"--I told him about this handshake agreement, and I said, "I think you owe us some money." Of course, he didn't have anything to do with it, and he said that he would get back to me. So he called up a few days later and he said, "Well," he says, "I'm sorry," he says, "but we don't think that you had an agreement with us, and there's nothing we're going to do about it."
So I said, "Well, I think I'll talk to my attorney." I had done some expert witness work for John--I'll think of his name in a minute--and his partner, David Hoy--John Miller, who was in Elko, and David Hoy is in Reno. On the litigation part, they hired a litigator who was an expert at courtroom--. His name was Greg Wilson. He was in San Francisco. Greg was just a tiger in court. He put on the most remarkable performances. He had a so-called expert in another lawsuit who was from Reno, the expert was, and he asked him a question, and this fellow said, "Yes, positively, yes, yes."
So then he started asking other questions. I could tell that he was going around in a circle, and he asked about a dozen questions, and this guy kept giving answers back. Finally, he came back and he asked the same question that he had asked at first, and the guy says, "No." Then he just tore into him. He was just a little puddle of sweat on the floor. His coat was absolutely soaked through with sweat.
Anyway, I went to Greg, and I told him about this. He says, "I'll take this on and win it for you, on a contingency, no cost to you." He says, "We'll not only take them for the $400,000. We'll get you the $400,000, but we'll get damages." By this time, that lawyer, Homestake lawyer, was working for the navy, and we would subpoena him and get him to testify under oath, and subpoena the rest of those fellows.
Well, neither Dale nor I wanted to really get involved in a lawsuit because, being a consultant--and I was working for other mining companies, and I didn't particularly want the word to get around that I was suing a mining company--and Dale being president of this company, his own company that he was president of, he didn't really want to get involved in a lawsuit.
But I called Bill up again, and I went over to see him, and I said, "I've talked with this lawyer, and he says that he's absolutely certain that we will take you for the $400,000 plus some damages." I said, "We want to settle."
He said, "Let me talk it over." He came back, and he offered $25,000. I said, "No, for both of us that is $12,500 apiece." Well, we finally got--if we had held out longer, we could have gotten more, but we got $50,000 apiece.
Swent:
What do you suppose their reasoning was in not continuing to deal with you?
Shoemaker:
The contractor from Seattle or Washington turned out to be a cousin of the purchasing agent, and the purchasing agent had gone to his cousin and told him about this, and then the contractor came down here and made the negotiations. He was ready to offer the Association a contract right then, and so they took it. That was just plain crooked. And for the Homestake people to go along with something like that, when we had this agreement--it was just--to me, it's unthinkable. Anyway, that's the story of--
Swent:
So that's how the Empire tailings ended up over there.
Shoemaker:
That's right. And the Empire Mine Association really lost on that because they only got nine dollars a ton instead of ten, and there was no cleanup work. We had promised them that we would clean the thing up, all of the tailings, and reclaim the pit and bring in topsoil and all that.
Swent:
It had been in a pond, you said.
Shoemaker:
It was in a separate tailing pond, yes.
Swent:
That had drained.
Shoemaker:
Yes.
Swent:
Well--
Shoemaker:
There are crooks in all businesses.
Swent:
I guess so.
Shoemaker:
I think it's probably a good place to stop.
Swent:
I think so.
[Interview 3: December 8, 1999]
Swent:
You wanted to say a little bit more about Tosco--I don't think we had said much about it, actually, so let's begin with the Tosco oil shale.
Shoemaker:
Well, it was a very interesting plant because they had to first remove the kerogen.
Swent:
And where was this plant, Bob?
Shoemaker:
Near Rifle, Colorado. Near Grand Junction.
And this kerogen has to be removed from the shale first, and then it has to be refined to some extent to make it equivalent to crude oil. Then it has to be re-refined into gasoline and all of the products that come from crude oil. The way that they did it is with heat, and the problem is that you cannot heat it too much, otherwise it destroys the kerogen and you can't make crude oil--you can't extract it and you can't make crude oil from what you do extract.
So it has a maximum temperature at which it can be treated, and their flow sheet was to crush this shale and then heat steel balls--like grinding balls; they were about three inches in diameter--and heat these steel balls and then mix these balls with the crushed oil shale. And then the kerogen vapor comes off and is collected, and then the residue, which is almost like an ash--it's not quite that--but it's quite fluid; that is, it's dry, and hot, but it's almost fluid. That is separated or screened out from the balls and the balls are then returned to the top of this big tower where all the equipment was and put into a furnace and reheated, and then when they are reheated, mixed with more of the oil shale.
The balls, after they were separated from the oil shale, were elevated in a bucket elevator, which is the biggest bucket elevator I've ever seen in my life. I think there was at least a half a cubic yard in each bucket and it was a kind of a material handling nightmare. These Tosco people were all petroleum types and they didn't know anything about materials handling, and that's how I got into it. Anyway, this plant was built on the side of a very steep hill which was mostly just talus--just loose rock--
Swent:
Excuse me, I need to interrupt for a minute just because I don't understand. This kerogen is part of the oil shale; is it chemically different or physically different?
Shoemaker:
The shale itself is rock, you might say. And it's fairly soft rock. I've forgotten the percentage of the kerogen in it, but it's a black material and they mine it.
Swent:
Is it a question of mechanically separating it?
Shoemaker:
After it's mined and crushed and mixed with these balls in this rotating drum, the shale just falls apart and is very, very fine. And the residue is very difficult to handle. So they were going to--if they ever built the big plant--were going to haul this residue back into the underground mine, because the shale occurs in horizontal beds.
Swent:
So that residue was valueless, then.
Shoemaker:
Oh, yes, yes. There's nothing in it at all.
Swent:
The kerogen had the value.
Shoemaker:
That's right.
Swent:
Okay.
Shoemaker:
And there's an enormous amount of that oil shale there. Eventually it will be used when we run out of oil and run out of tar sands up in Canada, and there's tar sands a couple of other places in the world, too. It will have to be mined unless the government shuts it up into a wilderness area which they're trying to do with coal and every other mineral.
Swent:
You were saying that the hill was mostly talus.
Shoemaker:
Yes, and this tower that all of this equipment was in was 200 feet high. It was all open and a conveyor out from the crushing plant at the mine entrance to the top of this tower where the crushed ore was fed into the equipment that was in the tower. Well, Tosco--they were very difficult to get along with and they apparently were running short of money for this pilot plant. They told Bechtel that they didn't want them there any more, that they would finish up a few odds and ends, one of which was the drainage problem when it rained. There was a road just above the plant, and there was a ditch just above the road, between it and the hill, and they had a fire loop built around the plant, with fire hydrants on it. So they were going to finish up this drainage and they didn't.
Then somebody backed a truck into one of the fire hydrants and broke it and all this water went into this ditch on the upper side of the road, and got down in underneath this big concrete slab the tower was sitting on. The tower was about 40 feet wide by 60 feet long, and it sat on six legs that were 200 feet high. The tower started to lean and I was up there--I had made several trips up there--and they have what we call a manlift which is a conveyor--a vertical conveyor--that has steps on it. You use this instead of stairs, although there were emergency stairs there. This was attached to one corner leg of the tower, and the tower was leaning and the manlift wouldn't work when it was at an angle so they kept moving the manlift out--the bottom of it out--so that it would be completely vertical.
By the time I got there, it was about eight feet out from the leg at the bottom and this tower was completely open, of course. And you're riding these steps up on this rubber conveyor belt and you have to step on and step off when the belt is running.
Swent:
And the whole thing is on the concrete pad that is slipping!
Shoemaker:
It's leaning, yes.
So anyway, Tosco called Bechtel back in--they were desperate, and so the first thing we did was fix the drainage properly and then the civil engineers came up with an idea how to straighten it up again. And it weighed, I don't know, it was up in the thousands of tons, so they cut off some of the legs, and--on the uphill side they cut those off. On the downhill side they cut in and put extensions on the legs, and jacked this whole thing back into the vertical position. It was a remarkable engineering achievement that Bechtel did.
Swent:
And nobody was hurt.
Shoemaker:
Oh, no, nobody was hurt, but eventually they shut the plant down because they just couldn't make it work economically. Technically it was not nearly as good as a Union Oil pilot plant that was a few miles away. And even that wasn't enough to make it--good enough to make it economic. Someday it will; we will hopefully be able to mine that material.
Swent:
Well!
Shoemaker:
It was quite an experience riding that conveyor belt--
Swent:
Very frightening.
Shoemaker:
That kind of brings up another one. When I was with Bechtel, we built a copper plant called Carr Fork. And it was just over the hill from Kennecott's Bingham Pit.
Swent:
This was for Kennecott?
Shoemaker:
We built this plant for Anaconda because they had the claims and--
Swent:
Excuse me, I would like to just go back before we leave Tosco completely. Who were the people that were involved at Tosco?
Shoemaker:
Oh, I don't remember any of the engineers.
Swent:
It was an independent company just put together for this purpose?
Shoemaker:
It was a company that was formed--I don't know where they got their money--but as I said before, Tosco means "the oil shale company."
Swent:
These were all oil people then.
Shoemaker:
As far as I know they were not in the business of refining like they are now. They were formed just to produce oil from oil shale if it was possible. But then afterwards they began buying refineries.
Swent:
They've been in the news around here so much lately because of the refinery and a terrible accident.
Shoemaker:
Yes, the one in Martinez and the one in Los Angeles. I don't know if they have any other refineries or not.
Swent:
When was this that you were involved?
Shoemaker:
Oh, this was in late--middle to late--seventies.
Swent:
So they were at that point producers, or trying to be producers?
Shoemaker:
I don't know whether they had regular oil refineries at that time or not. I don't think so.
Swent:
You said they were difficult to deal with. In what way?
Shoemaker:
Yes. Well, I think their whole attitude. They didn't know anything about materials handling and bucket elevators and conveyors. For instance, the separation vessel which was like a very large ball mill where they added the heated balls to the shale, it had to be sealed, so it was airtight. The seals were difficult to maintain and they would get the oil shale into the seals and then they would get leaks of air and then they would have fires.
They were much like--I have dealt with other petroleum people. For instance, I worked at the El Segundo refinery. They were making petroleum coke, which all refineries make, and they had quite a problem with materials handling, handling this coke and getting it out of the vessel in which it was made and cooling it and conveying it and putting it into a big storage building. There were a lot of things there; it had been built by--maybe it was Bechtel, I don't know, but there were a lot of things there that needed materials handling expertise.
So it was much like when I worked on the oil sands. It was difficult working with people--that was Sun Oil Company for the tar sands. They just don't understand materials handling any more than I understand petroleum. But we were talking about Carr Fork--
Swent:
Yes, go on to Carr Fork.
Shoemaker:
It was in this very, very steep canyon, and very narrow canyon on the--I would guess the north side of the Kennecott pit. We built the plant, and it was so narrow, the canyon was, that we couldn't put two buildings side by side across the canyon. There was a secondary crusher--the primary crusher was underground--and then the tertiary crushers and then the stockpiles, as they went down the canyon, thickeners for the tailings were the last pieces of equipment. We knew that a lot of rainwater would come down that canyon and we built two drainage canals, concrete canals. One was ten feet by ten feet in cross-section, on one side of the canyon, and the other one was eight feet by eight feet. And after we got it built--
Swent:
Is that an unusually large drainage canal?
Shoemaker:
Well, if you can imagine a ten-foot square canal. Sometime after we got it built, they had a rainstorm and it overflowed both of these canals at the same time. It was an enormous rainstorm and it did some damage. It shut them down for a while. It was just an enormous amount of water coming down, and those canals were at an angle, too, because they were in the bottom of this narrow canyon that was at an angle. But they had an underground operation and they had hired another engineering firm--I can't remember which--but they were specialists in sinking shafts. The headframe was a concrete headframe rather than steel like you very often see, and it was a circular headframe.
As I recall, it was 180 feet high, and it was built on another talus slope. Our civil engineers had warned them that they should prepare a drainage system before they started sinking the shaft, and they were sinking through this talus about 180 feet down to bedrock. They got down to about 100 feet and they were encountering water all the time, and then the headframe started to lean again just like this oil shale. So they called Bechtel in, since we had built the plant and they didn't think that the shaft-sinking people had the expertise to fix the situation.
Swent:
You had completely built your treatment plant before they began to sink the shaft?
Shoemaker:
No, they started to sink shaft first but the shaft was a couple of thousand feet deep, so they actually started that when we first started building the plant.
Swent:
So then they had to go down over 180 feet to get to the ore?
Shoemaker:
A hundred and eighty feet to get to bedrock to anchor this headframe. Well, they only got down about 100 feet before the thing started to lean, and they were excavating three shifts a day in order to try and get down to bedrock and anchor it so it wouldn't lean any further. But they didn't quite make it, so they had to stop work on sinking down to bedrock and brought Bechtel in. Bechtel put in a drainage system that kept the water from going underneath the foundation. Then they what they call "mud-jacked" the base of this headframe. They pumped cement in underneath the lower side of the concrete platform, and jacked it up so it was horizontal and the headframe was vertical. I was there quite often at that time watching, and of course I was there during the plant construction quite often.
It was very interesting to watch that 180-foot-high concrete headframe being jacked back into the vertical position. When they finally started operating, they were mining with what was called a "scoop tram," which is a front-end loader that is built very low to the ground, to work underground. The thing weighed a good many tons--twenty tons or something like that--and it was quite long and so to get it underground they had to tip it up on end and lower it down through the shaft. The hook on the hoist was supposedly good for--I think it was 90 tons. They got it just up to where they were almost ready to start lowering it into the shaft and the hook on the hoist broke, and this 20-ton scoop tram went down the shaft.
Amazingly, there was all kinds of electrical cables and air pipes and water pipes anchored to the sides of the shaft--it never damaged any of those. It made some scratches in the concrete. No one was hurt except one man who was standing near the shaft on one of the tunnels or drifts leading off of the shaft and he got knocked over by the air blast. It ended up at the bottom and that thing was not more than three feet high when it had been probably 20 or 25 feet long. It set them back for a while.
Swent:
Oh, my.
Shoemaker:
There was apparently a flaw in the casting of the hook, and even though it had been tested--Bechtel wasn't involved in that part of it. But I was there when it happened, and there was all kinds of excitement there. That plant didn't last very long. I think it ran for maybe about a year and Anaconda just underestimated their costs--their mining costs--and so they shut it down after about a year. It was quite a loss at that time and eventually the claims were sold to Kennecott and Kennecott just moved their pit over to mine that ore body. That is one of the things that engineering firms get into and--
Swent:
They call you in when things are desperate.
Shoemaker:
Yes. [chuckles]
Swent:
But you have to work with what you've got.
Shoemaker:
Yes, you do. You certainly do.
Swent:
About when was that, Bob?
Shoemaker:
That again was in the seventies. I can't give you an exact date. But we can go on to some of the consulting now.
Swent:
Okay.
Shoemaker:
This was a kind of a minor thing, but it was interesting. I got a call one day from Eastman Kodak. It was the purchasing agent, and he wanted me to bid on some consulting work. Well, I never did put in bids on consulting work. He couldn't tell me very much about what they were doing, and what they wanted, and so he finally transferred me over to one of their engineers.
This engineer told me that they had a very large sludge pond that they put all of their liquids and scrap and everything else into. They had two of these ponds and they let one of them dry out while they were putting material into the other one, and it was full of silver.
Swent:
Where was this?
Shoemaker:
In Rochester, New York. Once a year they would excavate this pond that had dried out and put this material back in one of their furnaces and smelt the silver, and there was an enormous quantity of silver. But this year they had been putting this material into the furnace and it foamed, and the foam would just come out of the top of this--it was an electric furnace--and cover up the whole charging floor. They just couldn't run it, and they were getting desperate and they didn't know what to do about it. So apparently the consistency or the chemical makeup of the material had changed, causing this foaming, and--they made a slag as well as the metal. Anyway I said, "Have you tried adding borax to the mix going into the furnace?" He said "No."
Borax is a very common slag-forming reagent and you add it in smelting gold and it makes a much more fluid slag. I said, "Why don't you try adding some borax to it?" He said he would and he would call me back. So he called me back the next day and he said they added borax and the furnace was behaving perfectly well and they didn't need anybody. [laughs] I didn't even send him a bill.
Swent:
How wonderful! Yes, well, borax has been used for hundreds or thousands of years.
Shoemaker:
But they just didn't happen to think about it.
Swent:
No.
Shoemaker:
As I was saying this morning, I recently wrote a paper on plant operations and stated that people are making the same mistakes that are tried and true ever since the time of Agricola and they're still making exactly these same mistakes today. And that's what a consultant generally--much of his work--is involved in, is to go to a plant and see these mistakes and correct them. It takes someone with gray hair, I guess, who has made those same mistakes, to be able to correct them.
Swent:
Who has seen them a lot of other places.
Shoemaker:
I mentioned that when I went into consulting for myself, the only other gold consultant was George Potter, who had worked for the [U.S.] Bureau of Mines for many years. I've learned a lot from George. I've known him for--he's still alive--I had known him for a great many years when he was with the Bureau of Mines. In fact, he was the one that was in charge of the research work that resulted in the carbon and pulp plant being put in at Homestake at Lead [South Dakota]. I will tell a little story about him, because he's such a famous man.
George is very soft-spoken and he never swears and never says anything off-color at all. He's taking care of his wife who is paralyzed for many years and in a wheelchair and he just treats her like a queen, takes her on all of his trips. But during World War II he was working in a plant in Los Angeles for recovering mercury from a flotation concentrate of cinnabar [mercury sulfide] that was mined in Mexico. One part of his job was to take care of what is called the hoeing table. The mercury volatilizes in the furnace; the cinnabar decomposes under heat and the mercury is volatilized, and then the mercury vapor goes into big condensing tubes that are probably 24 inches in diameter, and they are built in a U-shape.
A lot of dust goes into these tubes along with the mercury vapor, and the dust and mercury vapor condenses. It collects in the bottom of these U-joints in the condensor piping, and then it is drained out onto a hoeing table. The mercury at that point is very, very fine globules that will not coalesce into a liquid because they're all coated with this dust. This mercury and dust mixture is hoed in a circle. The table is about eight feet in diameter. You add lime to the material and there's heat applied underneath the table. The combination of the heat and the lime and the hoeing action coalesces the mercury, which is drained off a hole in the bottom of table and into the mercury flask.
Whoever built this plant didn't know anything about mercury poisoning, and normally these hoeing tables are outside in open air. But this one was in the inside of a room that didn't have any ventilation in it except for the door, and it was a small room. George told me one time that if anyone should have ever gotten mercury poisoning, he should have gotten it. It was just almost a certainty that he would get a severe case of mercury poisoning, but he didn't.
Swent:
Were there any fumes in the room?
Shoemaker:
Oh, yes, it was just full of mercury.
Swent:
I was thinking the globules, but there were fumes as well.
Shoemaker:
Yes. Even if there wasn't any heat underneath it, there's vapor coming off of liquid mercury at room temperature all the time. But he said that on the other hand, he had never gotten--and this is what surprised me--that he had never gotten syphilis either. He says there's most certainly a connection there because--and this was the time of the tuna fish and mercury scare--he says on the other hand, there has never been a validated case of a tuna fish contracting syphilis either. [laughs] I was quite shocked that he would tell such a story on himself. I guess he's fully retired now. I see him about once a year and he's a very great metallurgist.
Swent:
Did you ever run into Hugh Ingle?
Shoemaker:
Oh, yes, I knew Hugh.
Swent:
I did his oral history.
Shoemaker:
He worked for Frank McQuiston, and Ed Hewitt and I--
Swent:
That's right. Yes, of course. He tells about his wife. His wife did the hoeing for him. Up at the Corona Mine, she did the hoeing table, and they actually slept within a few feet of the furnaces. Of course it wasn't very tightly enclosed. There was a lot of ventilation. It was just a shed, actually, that was right next to their furnace, and that's where they slept, and they spent twenty-four hours a day sometimes there.
Shoemaker:
Mercury poisoning is very, very difficult to get. I'm surprised that George didn't get it, but this present EPA scare about mercury--they're checking all the rivers in the Sierra now for mercury that was left there, or spilled, by the old hydraulic miners. It's absolutely ridiculous. There's not enough mercury there to--what was lost has been washed down and ended up in the Pacific Ocean, or in the bay muds out here.
Swent:
It could be in the bay.
Shoemaker:
But there's not enough in the bay to bother anybody. There's a plan of removing silt from the bay and putting it up someplace in the San Joaquin Valley to build houses on and of course the environmentalists are all up in arms about that. The EPA, they don't know what they're doing. In Grass Valley, the county has a department of--it's an environmental control and hazardous material department. One of the people that they have there as a so-called expert, his total training was as a truck driver.
I thought I'd talk a little bit about Zortman-Landusky Mining Company. It was the Zortman-Landusky Mine, which was owned by Pegasus Gold, whose headquarters are in Spokane. It was a heap-leach operation which was originally started by a man by the name of Ed Sholtz. He had his two sons working there, and then it was just a baling wire, heap-leach operation. Their recovery plant was in two trailers. In fact they had two recovery plants, one for the mine on each side of this mountain. This was way up in the north part of Montana, about fifty to sixty miles from the Canadian border.
When Pegasus bought it, Jack Crowhurst, who I've mentioned before, was consulting for them. He was a mining engineer and I knew him very well and worked with him before. He knew that they were having all kinds of trouble with these two plants, and he got them to ask me to come up and work with him. So I did, and I worked up there for about three years and designed two new plants--both these plants were virtually designed on the back of envelopes. But anyway, they are now shut down. They had a cyanide spill up there a year or so ago, and the ore was also very low-grade. The EPA has been after them. The cyanide spill is like all other cyanide spills; it never hurts anybody. Cyanide is--well, I can talk about cyanide later.
Swent:
It scares people.
Shoemaker:
Yes, it scares people.
But the manager there was a new manager they hired and I arrived there the day that he did. His name was Ed Roper. He was a mining engineer. He was there for about three years and then left to work in Colorado for Galactic Resources, which was owned by Robert Friedland, who was acknowledged as being the best money-raiser in Canada. He was putting in this plant about fifty miles west of Alamosa in Colorado at an altitude of about 12,000 feet, and it was called Summitville.
Shoemaker:
Summitville had been mined in the very early days for gold and there were still a few of the miners' houses there that had a second entrance because the snow got so deep. It looked like a very large chimney coming out of the roof of these houses. It was probably at least ten feet about the peak of the house, and they had to get out of the houses that way--get out of them and get into them because the snow was so deep.
And then there was a very large gold mill, the remains of it. It hadn't quite all fallen down. That was mined, I think back in the late 1800s. Then Cleveland-Cliffs iron company got interested in copper, and so they put in a drift, or an adit, into the side of this side hill and were doing some test-mining of this copper ore that was there. They had a small pilot mill that they had put up. But Friedland and Galactic were after gold, and they had hired Ed Roper to be manager, and Ed asked me to help him. Actually, the deposit had been drilled out by Anaconda, and so Ed and Roger Leonard, a metallurgist that I--
Swent:
By drilled out, you mean just outlined, not completely taken out?
Shoemaker:
Yes, that's right. The exploration drilling.
Roger Leonard I had known before, over in Nevada, and the three of us went down to Tucson and talked to the research people about this deposit and got all of their--
Swent:
What research people were in Tucson?
Shoemaker:
Anaconda built their research lab down there. Nat Arbiter was the director of research.
Swent:
Did Anaconda still own the property?
Shoemaker:
They still owned the property.
Swent:
I see.
Shoemaker:
Galactic Resources, which was Friedland's company, bought the deposit from Anaconda. Then they put in two or three test heaps. They were going to heap-leach this ore. Roger was a metallurgist and he was the one that put in the test heaps. I don't like test heaps. I like to use large leach columns, maybe five feet in diameter. Five or six feet and twenty or thirty feet high.
Swent:
What's the difference?
Shoemaker:
You have much better control and you can also test more different types, more ores from different parts of the ore body. Whereas when you start to take a sample of say, 5,000 tons, which is about the minimum you can really use for a test heap, it all comes from one place and it is very difficult to measure the amount of solution--leach solution, that has the cyanide in it. It is very difficult to measure that going on and coming off of the heaps and to sample them. You can do a much better job if you use a smaller sample but still large enough, maybe it's ten tons in a leach column.
Swent:
Is this enclosed in something?
Shoemaker:
Sometimes you use a column that's made out of steel or a large piece of pipe that's say, five, six feet in diameter. Sometimes we use concrete pipe in six-foot sections that are stacked on each other. Like large diameter sewer pipe.
Then they decided to build a plant and I had not done any work between the time that I was down in Tucson, looking at data down there with them, until the plant got under construction and Bechtel gave them a lump-sum bid for constructing the plant, which they accepted.
Swent:
But you had left Bechtel.
Shoemaker:
Oh, yes. And also in the contract, they had received as part of their payment some warrants to buy stock in Galactic, and then if the plant was as successful as they hoped, they would be able to buy more warrants to buy more stock.
Swent:’’’
Was this usual for them to do that?
Shoemaker:
No, it was the first time they had ever done anything like this.
Swent:
And the last, I'm sure.
Shoemaker:
Ed Roper asked me to come up there and help them out with Bechtel. They were having some problems. As it happened, Bechtel's project manager was a man by the name of Carlton Smith, who had been their construction manager in San Francisco and who I had never gotten along with because he was one of these people who says, "Damn the torpedoes! Full speed ahead," and he didn't care how the plant got built as long as it got built. We used to have bitter arguments because the construction people couldn't make a concrete floor slope in the right direction. Big puddles would develop, and I finally got Bechtel to change their specifications so that all concrete floors would have to slope a certain amount.
Anyway, he was the construction superintendent up there and they were in a terrible hurry to get this plant built. It was a crushing plant and also the plant to recover the gold from the leach solution. They were, I think, designing some of it off the back of envelopes. One of the things that they had done when they had put in the primary crusher which was a large crusher--it was 54-74, what we call Allis-Chalmers crusher. It was driven by a motor and Vee belts, rather than the motor having its shaft direct-connected to the crusher shaft. I took a look at that and they had put a large concrete beam right where those drive belts had to go.
So I went up to see Smith and he and I just didn't get along, and he said that there was nothing wrong with that beam being there and that I didn't know what I was talking about. It ended up that they had to take the concrete beam out and that delayed them quite a bit. There were other things, and finally I wrote to Steve Bechtel, Jr., about it, and Carlton Smith was fired, which made me happy because he'd been a thorn in my side for many years.
Swent:
Were you just called in kind of on an ad hoc basis on this project?
Shoemaker:
I was consulting on a regular basis.
Swent:
You were there on a regular basis.
Shoemaker:
They built the heaps, or the leach-heap in a valley. It was a fairly steep-sided valley and they blocked off the lower end of this valley with overburden that they had removed from the ore body. Then of course it was--the sides of the valley and the face of this dam--which was something like 200 feet high, they lined that all with plastic. Winter was coming on and there was a lot of just plain black mud that had to be excavated from one side of this valley; otherwise, the weight of the ore would sink the plastic liner into the mud and it would tear.
The contractor had to bring in special dozers that had specially-wide tracks so they wouldn't sink into the mud and they never did get all the mud out of there. They left some of the mud there and put earth and rock over it and then put the plastic over it. Then they started bringing the ore, the crushed ore, in to put on this leach pad.
Swent:
Whose responsibility was it to design this, all this mud removal?
Shoemaker:
The leach heap and the dam building had all been done by some other engineering firm. I've forgotten who it was.
Swent:
You weren't involved in that?
Shoemaker:
I wasn't involved in the building and designing of it, no.
Swent:
What was your role?
Shoemaker:
To oversee the design of the plant. The recovery plant.
Swent:
But this dam wasn't part of the recovery process?
Shoemaker:
Well, yes, but Bechtel didn't have anything to do with that. They gave that to some other contractor, some other engineering firm. Anyway, they got quite a bit of ore in there--I don't know how many thousands of tons. But then it snowed. An avalanche came down one side of this valley and tore up all this plastic on that side of the valley, and just rolled it up into a mess, and rolled a lot of the ore that had been placed on the heap--rolled the plastic up into the ore. It was a terrible mess and they tried to remove as much of that as they could. They wanted to remove all of the damaged plastic, and they apparently didn't get it all moved and so they replaced as much of the plastic as they could. I know that there were holes and damaged plastic that they never did fix. There had been springs in this valley, underneath this area where they were going to put the heap. So they had put a lot of French drains in the ground underneath the plastic and that drained water out of the springs and it went through a pipe underneath the dam.
Swent:
What is a French drain?
Shoemaker:
It's a plastic pipe with holes in it that the water-- they bury it with rock around it and the water goes through these holes and it drains out. There's a French drain around almost every house at the foundation.
Swent:
I think I have one.
Shoemaker:
It used to be they used clay pipes and let the water go in at the joints of the clay pipes but they don't use those any more; it's all plastic now.
Shoemaker:
They finally got the plant started, and started leaching, and they began to realize that the water coming out from underneath the dam from these springs contained cyanide solution, and some gold, too. This had been leaking through the holes in the plastic, and so they collected it and started pumping it over back above the dam, and this flow amounted to about five million gallons a month. I kept telling them that they had to do something about this because this valley was slowly filling up with leach solution at the rate of 5 million gallons a month. The ore that was underwater, that was covered with leach solution, was not being pumped out of the heap. They had mounted the pump inside a five- or six-foot diameter pipe that went vertically down into the heap and was supposedly down at the bottom of the heap. They had rails mounted in these pipes --there were two of them--so that they could pull the pumps out. The weight of the ore on these pipes deformed the pipes and deformed the rails and the pumps didn't work any more. They couldn't pull them out for maintenance, and so they had to drop pumps in on cables, and they couldn't get them clear down to the bottom of the valley where this solution was building up.
Swent:
How deep was this area that we're talking about?
Shoemaker:
The heap at that point was about 200 feet high. That is, the dam was 200 feet high, and then as it went up the valley the heap got less thick, although they added ore above the height of the dam, back as you went up the valley. This old underground mine that Cleveland-Cliffs had put in was draining out acid water from the sulfides that were in the ore body. That part of the ore body contained sulfides, and that acid drainage went into a creek. That creek converged with another creek that came from the valley that the heap was in and they converged a couple of miles below the plant, and continued on to the Alamosa River twenty miles away. There was no fish or no life at all in this latter creek, and the first mile of the creek bed was just red with iron oxide.
I kept trying to get them to combine some of the barren solution from the plant with the acid mine drainage because the acid would have been neutralized by the lime in the excess barren solution from the plant. This would have resulted in neutralizing the acid and the cyanide and not cause any problems downstream. And it would have taken care of this five million gallons of increase in the heap every month.
Swent:
You would have had to pump the water up from that creek to the--
Shoemaker:
Well, we would have only had to pump it just over a slight hill. But the way the laws were set up, even though that adit was on Galactic's property, the State of Colorado couldn't force them to do anything about that acid mine drainage. In fact Galactic didn't want to even touch it because if they said that they touched it, did anything with it, then they would be responsible for it.
Swent:
They would be liable.
Shoemaker:
They would be liable. Well, I can't quite believe that because they could so easily have neutralized it with this barren solution and it wouldn't have--
Swent:
Do you know if anyone from Cleveland-Cliffs ever got interested in this?
Shoemaker:
Cliffs was out of it. That had been years before.
Swent:
I would think they would have been concerned about it.
Shoemaker:
I don't know how that turned out, but anyway, they didn't use this barren solution and this heap kept getting more water in it every month, until eventually there was over 100 million gallons of water and after a couple of years they had a very small spill, which got the EPA involved, and then the EPA insisted on them putting in a plant to mix hydrogen peroxide with the cyanide in the barren solution because they couldn't put any more water behind this dam. It was terrible. It was just a complete mess.
Swent:
Had they planned originally to cope with it? I mean, after the solution went through the rock, how would they get the rocks out of there?
Shoemaker:
The waste rock was just left up on the hill above the leach heap.
Swent:
They had not planned to remove it.
Shoemaker:
No, they hadn't planned to remove the waste at all.
Swent:
So it seems pretty obvious it would fill up with water and--
Shoemaker:
Well, it would fill up with leach solution. They were hoping that they could evaporate the excess water if they had any, but they wouldn't really have had any if they hadn't been adding this fresh water from these springs underneath the heap.
Swent:
And the drains weren't working?
Shoemaker:
The drains were working, but it would drain water into the creek, so they couldn't drain this water with cyanide in it into the creek, so they had to pump it back over. And besides it had gold in it.
Swent:
So they miscalculated the amount of water there would be.
Shoemaker:
Yes. Anyway, they put in this hydrogen peroxide plant to neutralize barren solution in the hopes that it would give them water that was sufficiently clean and it could be put into the creek. The EPA didn't know anything about what they were doing and they shouldn't have used hydrogen peroxide; they should have used ferrous sulfate. They didn't, and then the EPA imposed such strict conditions on Galactic and Summitville Consolidated Mining Company, what they called it up there--that there was a little bit of silver in the solution, less than half of drinking water standard, not enough to hurt anything, not enough to hurt any fish or anything else, but of course there wasn't any fish in this creek clear down for another twenty miles until it met the Alamosa River, which then diluted the acid mine water and would have diluted the cyanide, too. There wouldn't have been any cyanide left in the water down there anyway after a mile or so because it would be aerated and decomposed. \ But the EPA finally forced them to shut down and of course they weren't making any money anyway. They hadn't made any money because of all of these problems, and so they declared bankruptcy. Then the EPA took it over and so far they've spent something like $100 million and they haven't solved the problem. A group of mining companies, including Newmont and I don't know who else, offered to help the EPA and actually kind of take charge of reclaiming this disaster up there, but the EPA said no, and they have been working with that hydrogen peroxide plant ever since. And it isn't the right thing to do.
Swent:
It has become such a symbol now. Everybody who's anti-mining brings up Summitville.
Shoemaker:
Actually, there was never a drop of cyanide put into the creek but the media keeps repeating that there was a large amount put in the creek. The report of the Colorado Geological Survey even agrees there wasn't. Actually, for many years that creek had no fish in it because of the acid mine drainage from the old adit, but when it got to the Alamosa River it was diluted so much it never hurt anything. But the EPA has over-reacted like they always do. I understand that the EPA has never completed the reclamation of any of these--what do they call them? Hazardous--
Swent:
Superfund sites?
Shoemaker:
Superfund. They've never completed any of these Superfund projects. They're still working on them. Even right from the very start, they've never completed one. It's just an enormous waste of money.
Anyway, I was at the dedication ceremony. I was there and they had speeches and everything and then they took us for a ride on the railroad that goes from Silverton to--
Swent:
Durango?
Shoemaker:
Durango. And Friedland was there and made a speech, and after the speech he came over to me and asked me to serve on the board of directors of Galactic, and I very politely turned him down, and I'm certainly glad that I did.
That was a very frustrating couple of years that I spent there because they just didn't know what they were doing and they had so many problems that were unsolvable.
Swent:
Well, that's one place that everyone calls a disaster, and I guess everyone agrees it was a disaster, wasn't it?
Shoemaker:
Yes, for Summitville, but it wasn't an environmental disaster. As you say, it has become a symbol of disaster in the mining industry, and certainly it is Galactic's fault. It was too low-grade. It was one of these places where you couldn't make a single mistake, and they made mistakes in everything. The crushing plant that they had designed, I didn't agree with it, and yet between Roger Leonard and Bechtel they built it and it was an enormous problem. They didn't cover up the conveyors so that they got buried in snow. In the wintertime there's enormous snowfall up there, and there were just all kinds of problems.
Swent:
When you're called in as a consultant in a case like that and they ignore your advice, what--
Shoemaker:
The only thing you can do is quit and that's what I did after a couple of years. I saw that they were going to go belly-up and I just quit. I told them I just couldn't take this anymore.
Swent:
But you stayed with it through to the dedication.
Shoemaker:
Well, the dedication was right at the start. That is, as soon as the plant got operating, but it was too much a mess and I didn't want to be associated with it anymore.
Swent:
No. They did get into operation?
Shoemaker:
Yes, they ran it for, I guess eighteen months or perhaps two years. I quit probably six months before they shut down. They didn't have any money to do things right and they had a lot of stubborn people. Ed Roper had quit and he completely disappeared. I've never heard from him again. I don't know where he went. He was given a lot of stock in the company and Friedland had run the price of the stock up with all of his great speeches about how wonderful this plant was going to be, and of course all that money was lost. But Ed sold out his stock and made himself some millions and I guess maybe he just retired from then on; I don't know.
Swent:
Leonard? What happened to him? Did Leonard stay?
Shoemaker:
No, he quit, and he went to Africa. In Ghana.
Swent:
Well, it was a bad story.
Shoemaker:
Did I talk to you about when I was with David Lowell at Andacolla, and they had these Chilean mills and the superintendent of the Chilean mill had this secret ingredient?
Swent:
I think we talked about it off the tape when we were talking. Let's do it and if it's a duplication we'll cut one out, but I think that was something we just talked about; I don't believe we taped it. Incidentally, since then, I have interviewed David Lowell. At that time I hadn't met him, but I have done his oral history this last year, so let's talk about your associations with David Lowell.
Shoemaker:
I had known David Lowell for quite a while and he had asked me to get involved in the metallurgy of a heap-leach project down near Antofagasta for his company, which was called Minera del Inca. I supervised the test work down there for a heap-leach plant, but then it was sold to a drilling contractor who had a lot of extra money and who eventually then sold out to a subsidiary of Battle Mountain Gold.
Anyway, when I went down there to do that, to take a look at the sampling and recommend how it should be sampled for the metallurgical test work, we went up to the town of Andacolla. David wanted to look at this area that had an old copper mine up there, and there was a falling-down concentrator and a falling-down smelter that hadn't been run for many years, but there were dozens of very small gold mines there run by anywhere from two to a half a dozen people in each. I don't know how many mines, but there were a lot of them with the mills in Andacolla, and in the little town of Andacolla, which was only a few hundred people, and this was quite a ways up in the Andes, not really high but it was probably eight or nine thousand feet.
There were about two dozen Chilean mills--they call them "trapiches", and each one of them had what is called one or more Chilean mills. These are large, you might say, wheels--there's two wheels on an axle, and these wheels are about four feet in diameter, and many of them are just chiseled out of one piece of rock with a hole drilled in the center of them. They have a rim that's about eight to ten inches wide, and the center of the wheel is probably fourteen, sixteen inches wide where the axle goes through. They are turned in a circular trough made out of concrete with a steel bottom, and they're turned--
Swent:
Do they rotate horizontally?
Shoemaker:
The wheels are about say, four feet apart on a horizontal shaft, and then there's a vertical shaft connected to the horizontal shaft that turns these wheels around in a circle.
Swent:
But are the wheels going horizontally or like a--
Shoemaker:
Like a wagon wheel and they are just going around in a circle. They shovel ore into the path of these wheels and the wheels are also pivoted--the axle has got a universal joint on it so that when it runs over a big rock, the wheel will lift up, one of the two wheels or both of them. They actually can put rock in as big as five and six inches, and the sides of this concrete bowl that these wheels run in are kind of sloping, and they have copper plates hanging around on this sloping side. Then as the wheels turn, they add water, and as the ore is crushed and ground into this slurry, the slurry is splashed up onto these copper plates, which are coated with mercury, and the gold that is in the ore is collected on the mercury amalgam plate. I'd never seen one of these; I'd seen pictures of them--
Swent:
I've heard the term but I've never known how they operated. They have motors, then, little motors that turn them?
Shoemaker:
Fifteen-horse electric motors. The power lines were there originally for the copper plant, which--they still had electric lights and enough power to run these little mills, and there were, as I say, perhaps a dozen of these with one to three of the Chilean mills in them, in the plant. When we arrived there, at this one little plant, there were three of these Chilean mills, and they were taking these copper plates out of the mills and replacing them right away while they cleaned the gold amalgam off of the plate. They laid these copper plates--they were about an eighth of an inch thick and say, twelve or fourteen inches wide and about four feet long--they laid them on a couple of boards that were sitting on top of a water tank, which was made out of a couple of 55-gallon drums cut in half.
First they would scrape the amalgam, as much of it as they could, off of the plate with a section of rubber belting that they had cut with a sharp edge on it, and amalgam would go down into the water and then they would recover that and put it through a small retort, and recover the gold and recover the mercury. After they had scraped the amalgam off of the plates, they would then put sand on the plates and rub the sand in to make remaining mercury amalgam on there very smooth. They would just scour them and it would also remove other things that would get in the amalgam, like copper and so on, and refresh the plate. And then they would take a bottle that had a cork in it with a small hole and the bottle contained mercury and they would sprinkle the mercury around on the plate and rub that in with their hands. Of course that wouldn't be allowed here in the United States but they didn't know that they could get mercury poisoning because they never did.
Oh! Just before they did that, before they put the mercury on, they had a bottle--a plastic liter bottle--and it was full of this yellow fluid, and they sprinkled that on the plate and scrubbed that in with their hands also. This was between the sand and the mercury. All mill superintendents who have ever used mercury amalgamation plates--it seems like all--had their secret ingredient to make these amalgam plates pick up the gold more efficiently. They used everything--salt, and vinegar, and borax, and I don't think any of it ever worked. But they had the reputation of never telling anybody what their secret ingredient was, and I asked David, who spoke Spanish, to ask this foreman there what this yellow fluid was.
He said to David, and David translated that he couldn't tell me because that was his secret ingredient for making the amalgam plates perform better. I asked David to tell him that I was from the United States and I was a metallurgist and I was very much interested, and I would promise not to tell anyone what it was if he would tell me. So he did. He told David, and David told me, it was a bottle of his own urine. I had never heard of that before and I said, "David, ask him if wouldn't it be better if he used urine from eighteen-year-old virgins?" The foreman laughed and he said back to David that it would be very much better, but there were no eighteen-year-old virgins in Andacolla. [laughs]
Swent:
Did you work with David any other time?
Shoemaker:
I worked with him--
Swent:
Didn't you take a trip to China with him?
Shoemaker:
I went to China with him. We did that for DuPont.
Swent:
I don't know that you've talked about that, have you? I don't believe you have.
Shoemaker:
I don't think so. That's still--
Swent:
That's coming. Okay. All right.
Swent:
You were going to talk about mistakes that have been made.
Shoemaker:
I mentioned all the mistakes at Summitville, but I was hired by an outfit called "Amok Uranium." It was a French company; I don't know what "Amok" stood for, but they had a uranium mine up in northern Saskatchewan. They had put in a mill, and they had one of the Canadian engineering firms put in this mill, and it was a case of--it happens fairly often that the owner does not furnish enough people to oversee the engineering firm and the engineers are not very often operators, and so the engineering firm didn't have any guidance and they made a number of mistakes. They had a lot of trouble, Amok did, when the plant was finished and they tried to run it. So they hired me to come up and take a look at what the engineering firm had done, and to see if they should sue.
Well, in my opinion it was partly their own fault because they hadn't overseen the engineering firm. But then again, the engineering firm made some horrible mistakes. One of them was that they put a lot of their piping, not only water piping, but slurry piping and air piping, right in front of the main air intake to the plant building. This was in northern Saskatchewan, up in the tundra area, with enormously cold winters, and the fresh air they brought in was--they had furnaces in there, air-heating devices, to heat the air, but all of these pipes promptly froze up and shut them down and caused quite a bit of damage in the plant because everything got frozen. Not only those pipes, but they had to shut down the heating plant and they finally got started back up again.
Another one was they had a fire loop, piping, around the entire plant out from the plant building, with fire hydrants, and this was buried in the permafrost. That way it was insulated, even though it was buried, but it would have frozen if they hadn't--they would pump water through this loop constantly, and as long as the water was moving, it wouldn't freeze, even below freezing temperature. There is some heat put into it because the pump itself is inefficient and that amounts to heat.
Anyway, the fire loop didn't make a complete circle; it was two half-circles. Those pipes at the far end--they were supposed to be joined and they weren't, so their whole fire system froze up, which is a horrible mistake. I finally told them that I thought it would cost them probably more than they would be able to get out if they sued, so they ought to try to settle out of court, which they did. They did collect quite a bit of money from the engineering firm because the engineering firm didn't want the bad publicity, and they were justified in collecting some money. But it was too bad that people don't oversee their engineers like they should, and it's too bad that these mistakes are just made over and over again since the time of Agricola.
Swent:
You would think the engineers would have known it gets very cold in northern Saskatchewan. It doesn't take a--
Shoemaker:
Terrible.
Swent:
As they say, it doesn't take a rocket scientist to know that.
Shoemaker:
There was another one that made a lot of mistakes, which was the Northumberland Mine over north of the Round Mountain heap-leach operation, which is partly owned by Homestake and partly by Echo Bay.
Swent:
This would be in Nevada?
Shoemaker:
Yes. Northumberland was owned by Amoco Oil Company at that time and they had a vice president from the oil company that--they established a minerals division--this is during the time when all the oil companies were trying to get into the mining business, and this vice president, they put him in charge of this construction of this heap-leach operation. The mine was at an altitude of nine or ten thousand feet, and they had to put the crushing plant up at the mine and then haul the ore down the hill to the Smokey Valley, which is only at five or at the most six thousand feet. They had a twelve-mile haul, and it was low-grade ore to start with.
This vice president, he was going to make a name for himself because he was ready to retire, and--
Swent:
Do you want to say his name?
Shoemaker:
He wanted the glory of their first gold mine.
Swent:
Do you want to name him?
Shoemaker:
I would really rather not.
He had drawings from seven different engineering firms. He got a little piece of the plant done here, and another piece done there, and another piece done someplace else. When they finally hired a construction contractor and tried to put all these pieces together, it was just a complete mess.
But they finally got it built, and finally got it repaired enough so that the plant would run and it would extract gold, but the trouble was, they couldn't leach any of the gold out of this ore. The ore had a lot of clays and fines in it, and the heaps were being built right near the plant, and the haul trucks that they used to bring the ore down off this hill were bottom-dump--the tractor, the truck, would pull two bottom-dump trailers, and they were normal-type of trailers and tires that would run on a highway. They put a lot of money into this road coming down the hill. They bought cheap trucks and these trucks, although they were diesel, they didn't have proper retarders on them, so they could use the engine for braking. They lost I think three of their trucks coming down that hill, before I got there, and killed one of the drivers. The retarders wouldn't work well enough and they had to use the brakes and the brakes wore out and they ran off the road.
Swent:
Oh, dear.
Shoemaker:
But they were driving these trucks up on top of the heap and dumping this crushed ore in windrows and these high-pressure tires that are built for highway travel were just compacting this ore. It was so hard it was almost like asphalt, an asphalt road. They had a dozer up there on top of the heap, and were flattening out these windrows, and then these trucks were driving all over this heap and it was just virtually solid rock. Not quite that, but almost.
I got a call from the Amoco people in Denver, and they asked me to go out and take a look at this. That's one of the major things that I looked at and I told them that they just couldn't do this. They had to dump the crushed ore in one spot and push the ore with a dozer to distribute it around on the heap. They could not run those trucks on top of those heaps. That was the major thing but I made some suggestions about the crushing plant and also the plant itself. But that was the major thing, and so they got my report and they called me up. They said that they were going to have this manager--told him that he couldn't run the trucks on the heaps any more, and a month went by and they called me up again and they asked me to meet them. Their headquarters are in Denver and they asked me to meet them in Salt Lake City. They were bringing their company airplane out, and then I would fly with them over to Nevada to where the Northumberland plant was. They had an airstrip there.
As we got over the plant, I asked them to ask the pilot if he would make a circle of the operation. And here they were still running the trucks over this heap, and consequently when we landed, the first thing that the vice president did was fire the manager.
That's where I first met Roger Leonard. In fact I recommended him to them as mill superintendent there. I'd known him--I had first met him over at Pinson--the Pinson Mine. But I recommended they hire him because their mill superintendent didn't know anything about a gold plant.
It's just typical of some of these oil companies, what they did, like Arco bought Anaconda and found they didn't know what they were doing. Every one of these have been disasters. I think the only oil company that's still really in the mining business is Exxon, and they have a major piece of one of the large copper mines down in Chile. Even Exxon has had a couple of plants that have been disasters and they'll never get their money back.
Swent:
It's interesting that with all this talk about corporate culture, I guess the mining culture and the oil culture just don't go together, do they?
Shoemaker:
No, they certainly don't. They certainly don't. You know, mining isn't really a very profitable business. I was reading a report put out by the National Science Foundation the other day, a book, in fact, on mining in the United States and how the laws are enforced badly by the Forest Service and the Bureau of Land Management and the EPA and so on. It mentioned in there that mining companies make on the average one of the lowest returns on investments of any industry in the United States. Very, very few mines really end up as--for instance, like Homestake is lasting over a hundred years, but on the other hand, Homestake in the last few years has done virtually nothing except lose money, or trade dollars. I guess they're in a little better shape now, but they've had some very disastrous years which takes many years to make up. Many, many good years to make up for one bad year.
Shoemaker:
I worked in South America, I think I've mentioned, for CVRD, and I helped them put in the first heap-leach plant in Brazil.
Swent:
What was this?
Shoemaker:
CVRD. It's Compania Vale do Rio Doce. We had it mentioned in the previous--
But this one was a gold deposit. It was called Fazenda Brasiliera. It was in Bahia Province, up north of, probably 300 miles north of Rio and west of Salvador, which is on the coast. But they had been doing their research work at the Belo Horizonte laboratory, and they couldn't get any activated carbon. At that time, it was very difficult to import things into Brazil. I had been working on something else and when they found out this ore body might turn out to be a heap-leach, I, the next time I went down, I took a couple of two-liter bottles of activated carbon, or activated charcoal, down with me. I put them in my bag and the customs unfortunately opened my bag at that time and I knew I was in for trouble there and he asked me what it was and I said it was activated charcoal and he says, "What are you going to use it for?" and I thought quick and I says, "I can't drink the water here and I filter this water through activated charcoal to keep me from getting sick." And he said, "Okay, fine. Go ahead." [laughter]
Later on, I consulted on that plant and helped them with their test work. Then when they started to build the plant, they were using what we call "wigglers" to distribute the solution on top of the heap. And wigglers--in the early days of heap-leaching, they used pieces of surgical tubing that were about eighteen inches long, connected to the distribution pipes, and these things whip around, they wiggle, and they weren't very good, they didn't give even coverage of the leach solution.
So I smuggled in a half a suitcase load of what we called "wobblers" at the time, which was a plastic sprinkler. They used those on the heap that they put in, along with wigglers, and they worked so much better that they finally got a special license to import some. And then a company started making them down there.
Swent:
So you stimulated the business down there.
Shoemaker:
Yes, having to smuggle things in like that is interesting.
Swent:
What would you have said if they had caught you with the wobblers?
Shoemaker:
They would have confiscated those because they would have known I was going to do something with them. Sell them or something. But they didn't happen to open my suitcase at that time.
Shoemaker:
I can talk a little bit about J. P. Morgan.
Swent:
Well, that's a good old name.
Shoemaker:
I got a call one day from one of the J. P. Morgan people and they had loaned quite a large amount of money to an outfit called Geobiotics over here in Hayward. This was a small startup company doing research and they were producing enzymes, but they were doing research on other things and for some reason or other, they thought they could develop a process for treating carbonaceous gold ores. [chuckles] So they wanted some more money and Morgan wanted me to go down there and take a look to see if this might be something--they didn't want to loan them any more money without assurance they would get it back. So I drove down there and stayed overnight in Hayward and went to the plant the next morning, and I spent most of the day there and they wouldn't tell me anything. They just wouldn't tell me anything!
Swent:
No secret ingredient?
Shoemaker:
It was all so secret that they wouldn't tell me anything. So I went back home and I called up the person at J. P. Morgan and said, "That was a complete bust; they wouldn't tell me anything," and he said, "Well, you go back tomorrow," and he said, "They will tell you everything." He was pretty mad.
So I went back down the next day, the day after I got home, and even then it was like pulling teeth, trying to get information. The carbonaceous gold ore business has been solved by roasting, and some it has been solved by ultrafine grinding, and some it has been solved now by bacterial leaching. But they had a process of flotation of the carbonaceous material from the ore, and then they would burn the carbon and recover the gold from it and then they would cyanide the residue from the flotation. I finally got that out of them.
That sounded familiar to me, and I realized that I'd been talking with Frank McQuiston at one time, when I was with him over at Carlin. They had developed the very same process over at Carlin, but it hadn't worked. These people had gotten hold of a sample of ore from someplace and it contained some carbonaceous material. They had spent several months and then they wanted a lot more money from J. P. Morgan to develop this, and I told J. P. Morgan--I didn't tell these people at Geobiotics--but I told Morgan that Geobiotics had developed a process which was already invented, but it hadn't worked. So apparently they didn't loan them any money.
Swent:
But that's what the consultant is good for.
Shoemaker:
Yes, that's right. [shuffling papers]
I wanted to talk about--
Swent:
I'm nervous when I see you skipping through a lot of things. Are you--
Shoemaker:
Well, some of these are just notes.
Swent:
I don't want to miss anything good. Is that a flow sheet here?
Shoemaker:
When I was working for CVRD they asked me to go up to their Caue Mine, which was north of Belo Horizonte by about seventy or eighty miles. It was a very large iron ore plant; they mined 60,000 tons a day of iron ore, and the iron was in the form of specular hematite. It was hematite, which is iron oxide--two irons and three oxygens--but it was in a different crystal form than normal hematite and it was called "specular hematite." This specular hematite is black and it forms into small crystals and doesn't make a homogeneous mass. It breaks up easily into these little crystals which are maybe an eighth of an inch long. There was clay mixed in with this, but the ore, when they shoveled it from the pit into the truck, it virtually all broke apart. They didn't have to crush it; they just fed it into a large drum with water and the drum had blades in it, and it just all pulped up into an easily-handled slurry, and they separated--after cycloning it to remove the clay, the cyclone underflow went to magnetic separators--high intensity magnetic separators because a normal magnetic separator will not pick up any hematite. Hematite is not really very magnetic. Specular hematite is magnetic only under very high intensity magnetic separation.
They had a tailing pond. The plant was up on kind of an escarpment, and they dumped their tailings over this escarpment, and they went down kind of a little narrow canyon that gradually spread out, and 60,000 tons a day is--well, there was probably only maybe about 20,000 tons a day of tailings going out there with the water too. It's almost like a waterfall down this escarpment into this canyon, and then as the canyon widened out, there were deposits of tailings in this canyon that had kind of filled it partially full--not very thick because it was slanting quite a bit. Then they had this enormous tailing pond out at the end of this little canyon.
Shoemaker:
Someone had heard that there had been gold mined at that place way back in the 1920s. They didn't know where the gold had been mined. The records had all been lost and they couldn't find any evidence of mining there, so one of the geologists decided to go down into this canyon where there was some of the tailings, and he put a drill down there to take some samples. Well, it turned out that this narrow canyon was a wonderful gold-concentrating sluice, and there was a lot of gold there. The largest pieces, of course, settled out right at the base of this escarpment, and then the finer ones went farther down and very little of it ever got down to the tailings pond, or probably none of it. This canyon was probably a third of a mile long.
Shoemaker:
As soon as he had put that drill down there, it attracted garampieros, like I told you about at Serra Pelada. And they swarmed in there and started concentrating the gold in little rockers and excavating these tailings, and they got so many of them in there that CVRD couldn't get rid of them. They couldn't kick them out. They finally found that there was an English mining company--they knew it was an English company that had been mining the gold--had found a one-foot-wide seam in this specular hematite deposit that contained about an ounce of gold to the ton. It was impossible to determine by just looking at it that there was gold there, and so much of that had gone down into that canyon and was lost--and this plant was probably ten years old at the time. At 60,000 tons a day, they had mined an awful lot and they had lost a lot of gold that the garampieros picked up.
So they very quickly put in a couple of big wooden sluices, up in the top of the plant. And these sluices were four feet wide; there were two of them, they were four feet wide, about three feet high, and and a hundred feet long, and they had riffles in the bottom. They put all the plant tailings through those sluices, or riffles, and they collected I would estimate probably half of the gold in the ore. The velocity of the water and the tailings was so very rapid that I'm sure they only got the coarsest gold. The garampieros cleaned up. They were still working when I was there. They were working down at the lower end of the canyon, picking up the very fine gold. They had another tailings line that was actually a launder, that went kind of around the tailings pond so they could fill up another area, and these garampieros would break into the top of this concrete tailings pipe--it was a square pipe that they had built out of concrete, and they would break into the top of that and put riffles in the bottom of the pipe. They had to have armed guards all over the place. They found them in the plant itself in the night time, and they would open up the bottom of the sumps that fed pumps, and gold would collect in the bottom of those sumps. They would find these garampieros in there at night.
I drew a little flow sheet for you and it shows the sluices. They first pulped the material with water and then cycloned and got rid of the slimes, the clay, and then the underflow of the cyclones went to magnetic separators. The nonmagnetics, which had some quartz sand in it and also had the gold, went to these sluices, and then the tailings from the sluices went down to the tailings pond. Well, they did get some of the gold, but it was so easy to see that those nonmagnetics, which were a very small quantity, should not be mixed in with the tailings, and sent to the sluices to be recovered. This amount was so small they could just go to simple gravity separation. So I designed up a little plant for them with a couple of shaking tables, and a furnace, and they were able to then remove all of the gold, a very considerable quantity, and they were producing gold at about twenty dollars an ounce, and they're still doing it to this day. The heavy black line on the flow sheet shows the gravity separation portion I added.
Swent:
That was a lot simpler than what they were doing.
Shoemaker:
It was very simple and it collected twice the gold they had been collecting through these sluices, and they were extremely pleased.
Swent:
Of course they were. And you, too. That must make you feel awfully good.
Shoemaker:
One of these things you kind of fall into occasionally. Let's see, I talked about Serra Pelada already, didn't I? Serra Pelada was another mine that was discovered in late 1979 by CVRD.
Swent:
This was in Brazil also?
Shoemaker:
In Brazil. They put some drill rigs in there and as soon as they did that, the garampieros came in in swarms.
Swent:
Oh, this is the one you took the fabulous pictures of. Oh, yes!
Shoemaker:
The ore body itself was in a very soft rock, much of it just plain clay, and very quickly the garampieros, which means "independent miner"--there were so many of them that CVRD just couldn't kick them off the property. All the equipment they used was just a hollowed-out log that they put their ore and water into and crumbled up the ore with their hands, and separated the rock, which contained part of the gold but very little. Most of the gold was in the clay, and then they put this broken-up and slurried material into a little rocker, like the old miners used all over the world for that matter, and up in the Mother Lode country where I live.
They established claims that were two meters wide and three meters long, and ten men would work each claim. They were all independent but these ten would have this claim, and the government stepped in to keep order. They put the army in there to keep order and the military men would carry submachine guns, and they would settle arguments right on the spot. There were always arguments going on between these people: maybe they stepped over the claim line or something. At the very peak there were 60,000 men--garampieros--working there at that operation, and the pit became deep and with very steep walls. The government twice hired a contractor to come in and lay back the edges of the pit because it was caving in. In fact, the day I was there it caved in and killed several men. The government also put a diesel-operated pump in the bottom of the pit to keep it dewatered, but that's the only thing the government did.
The government allowed no women in the camp. There was a town twenty kilometers away that had stores and women and bars and so on, and I guess that was just like a frontier town in the United States. It was pretty lawless. But the government kept order at the mine, and the government kept promising CVRD that they would kick all of these garampieros out. But they kept coming in more and more, and finally they just couldn't put that many people out of work and so they just had to tell CVRD that they had lost their deposit. Of course CVRD was owned 51 percent by the government at that time. It has now been privatized in the last two or three years. But the ore went about, they think, an average of about an ounce per ton. CVRD was able to get in in the early days and dig some trenches in the pit and obtained fifteen or twenty tons of sample they took to the research laboratory at Belo Horizonte. There were some very large nuggets found, and some of the early people got extremely rich. It was fairly common to find nuggets that would weigh twelve or fourteen kilos, and I have a number of pictures of them that are that large. There would be one man digging the ore and eight men hauling the ore out of the pit in sacks on their shoulders, and then one man running the concentrating operation. There were hundreds of these concentrating operations, and everybody lived in tents.
The government bought their gold right there. They would weigh it, and they would actually smelt the gold which the miners would bring in, individually in a crucible. Then by taking the ingot and rubbing it across a silica plate, scraping a little of the gold off onto this white silica plate, they could tell very closely from the color of the streak left on the plate how pure the gold was. They would pay the miners for the gold right then. They had to bring the money in in huge boxes because that was during the time when inflation was so rampant in Brazil and you were paying thousands of cruzeiros just for a taxi ride.
In the early days of this operation, CVRD still had very high hopes of taking it over and putting a plant in there. They asked me to help them out and they had designed a plant that was all gravity separation. They were sizing the ore into different size fractions with cyclones and they had nothing but jigs for the coarse gold and shaking tables in the plant.
Well, first of all, they would hand-pick the large nuggets out, and then run the material through jigs and then over three sets of tables--shaking tables in series. But they still lost about half of the gold; it was just absolutely microscopic and it wouldn't separate out by gravity. They had tried flotation but the clay was so viscous that flotation wouldn't work. It was almost like trying to float oatmeal. It was not quite that viscous but almost.
It struck me that they--there is nothing wrong with diluting this material. They had been working with it at 30 percent solids, trying to float that and it was still like oatmeal. I suggested that they dilute it down and they did and at 20 percent it looked better. At 10 percent solids it looked even better, and finally at 5 percent solids, the viscosity of the slurry was such that it could be floated; and gold is a naturally-floating mineral. It worked beautifully and they were able to get virtually 100 percent recovery of the gold.
Swent:
There was plenty of water there?
Shoemaker:
Plenty of water. Ninety-five percent water and only 5 percent solids.
Swent:
No, but I mean you had plenty of water supply there.
Shoemaker:
At least in the laboratory we did. And I'm sure they did up there because that was in the Amazon Basin.
But anyway by the time we had finished that, shortly after, that work was finished and we started to design the plant. But then the government wouldn't kick the garampieros out, so all that work was done for nothing.
Swent:
That was an amazing situation, wasn't it?
Shoemaker:
It certainly was. There were all kinds of people there. There were doctors and lawyers and they would haul this stuff out on their backs. The pit eventually became almost 500 feet deep, and all the slimes, unfortunately, the tailings from these rockers, still contained a half an ounce of gold per ton, but it was so fine they couldn't recover it. The government built them a tailings dam out of the rock that was in the tailing, plus other rock from nearby, and they put all of these slimes containing a half an ounce of gold per ton into this tailings dam.
But with all these independent miners, they could never agree to use any of their money to maintain the tailings dam or to lay back the edges of the pit. The tailings dam finally washed out and it all ended up in the Atlantic Ocean--all of that gold. Finally the pit got so deep that it was so dangerous the government finally shut it down and today there's no one there. It was an interesting experience, though.
Swent:
I'll never forget those pictures that you took.
Shoemaker:
Yes. I've still got them.
Swent:
We'll put a couple of those in here.
Shoemaker:
Yes, I could give you some of the gold nuggets--pictures of the gold nuggets.
Swent:
Pictures of the people, too. Didn't you take those pictures of the pit? It looked like scenes from Dante's Inferno.
Shoemaker:
Yes, I'll give you some of those pictures. A couple of them, anyway.
Swent:
All right, we're continuing after a break. We've had our lunch and we were talking about Serra Pelada, but we're ready to move on to something else.
Shoemaker:
Maybe we can talk about another one of these lawsuits that I've gotten involved in. This last one happened a couple of years ago, and I was working for a company--or I was called by a company called Kalimantan Gold, and they got their name from Kalimantan Island, which is part of Indonesia and is the same island that the Bre-X scandal happened on.
Kalimantan was--I didn't know it at the time, but they were controlled by Plutonic Resources in Australia. Plutonic Resources was later merged into Homestake. But Kalimantan had found a gold deposit on Kalimantan Island and had started to drill it out and it looked like a pretty good deposit. They didn't have too much money. It was a small company, and so they brought in CRA, which really is Conzinc Rio Tinto of Australia. CRA, they were the people that built and operated the Bougainville copper mine and then lost it when the Indigenes shot a couple of their people and they had to close it down.
So CRA had 80 percent of the stock of Kalimantan Gold, and they took over the drilling program and they became managers of the entire project. They developed a very large gold resource and finally they had the deposit drilled out and they had decided that they would put in a plant that would process seven million tons of ore a year. They made a call--a cash call--on Kalimantan for their 20 percent share of the cost of building the plant and the mine. Kalimantan didn't have enough money.
CRA made an offer to Kalimantan for all of the 20 percent of the stock that they didn't own in this company--it was called the Kelian deposit, Kelian Mine--they based their price for the stock offer on the projected grade and tonnage of the gold and the projected recovery of the gold. Kalimantan accepted the offer. So that left CRA with 100 percent of the stock, minus a fraction that went to the Suharto family, and they built the plant.
It wasn't a real high-grade deposit; it was down about two grams of gold per ton, which is about .06 ounces per ton. They started up the plant and ran it and during their first year, they made 50 percent more gold than they had projected they would make. So Kalimantan sued, and I was asked to be an expert witness for Kalimantan. After reading enormous amounts of documents and--when you're in Australia, you prepare a report for the court, you don't prepare it for the company who's paying you, you prepare it for the court, an expert witness does.
And then that report is given to the opposition's experts for them to rebut. You get a copy of their rebuttal and then you can write a re-rebuttal. Then that report is actually given to the court and the attorneys ask you questions about it. They do not ask any questions that aren't about things that are not in your report, and you are not supposed to volunteer anything that is not in your report. [laughs] The rules are kind of complicated.
Swent:
I'm going to ask you another question. I was told at one point that Australian legal documents don't allow internal punctuation, that every sentence--you can have a period at the end of a sentence, but they don't allow semicolons and commas and things like that. Is that still true?
Shoemaker:
I haven't run into that.
Swent:
Your reports could be punctuated the same as they would be here?
Shoemaker:
Yes.
Swent:
I see. Someone told me once that in order to avoid any kind of ambiguity that they had this restriction on legal documents in Australia.
Shoemaker:
I haven't run into that. I'm sure it wasn't in the reports from the other side that I reviewed.
Swent:
Okay. All right.
Shoemaker:
While I was writing this report, I kept getting more documents, and even got more documents after my report was written under their discovery principle, you know. I knew something was wrong right at the very start, but anyway I finally began to realize what it was. There was mention in the research work of the presence of coarse gold in the ore, but CRA didn't believe it. They thought there was nothing but extremely fine and microscopic gold present in the ore. They ignored these couple of reports from research laboratories that there was coarse gold. Additionally, they did virtually all core drilling, which was fine, and they would split the cores in half every two meters. \ They would then take that half-core, which amounted to probably fifteen or twenty pounds at least, and they would crush it all to a very fine size, about one millimeter, or one and a half millimeters, and then they would split the sample down to about 500 grams. Then they would further grind that to about minus-150 mesh, and then split out a 10-gram sample from that and use the aqua regia digestion method of assaying, where they would dissolve--or attempt to dissolve--the sample in aqua regia and then read the gold content on an atomic adsorption unit rather than doing a fire assay.
The final sample was far too small in my opinion, versus, say, Round Mountain Mining Company which is partly owned by Homestake and partly by Echo Bay. Their final sample is two five-assay tons of ore, about three hundred grams, and they have coarse gold. They have to use such a large sample in order to make an accurate assay.
So I got some assay beads from a laboratory over in Reno, from one-milligram size down to a thousandth of a milligram, or a microgram, of gold, and mounted them on black paper so they would show up and put clear Scotch tape over them so they wouldn't fall off. I took those with me. I had, I think, five different gold beads. I told the attorneys about this and explained to them that the ten-gram sample that CRA ended up with might or might not have one of these relatively coarse particles of gold. When I say coarse particles, I'm talking a number of microns in size rather than, say, two or three microns; it might be twenty-five or thirty, or even fifty microns or even larger.
They told me if I could manage to answer one of the opposing attorneys' questions by bringing this in about the size of the beads of gold, or particles of gold, that maybe the judge would allow it. During my testimony of three days, the attorney asked me a question in which I could slide in this business about the size of the gold beads, gold particles, and what the size of one of those particles could do to a sample or not do to a sample.
The opposing lawyer--the lawyer was asking me the questions--he immediately jumped up and started objecting. Which was the third time that he'd objected. I got him so mad, so angry, three different times that the third time, and this was the third time, the judge had warned him against this. The third time, he fined him; he held him in contempt of court. He was so angry he just lost his temper. Anyway, the judge, who was a very, very intelligent man, very imposing in his robe and his white wig, he said, "I will overrule the objection. I want to hear this."
I told him, I'd mentioned in my remarks that I had these gold beads in my briefcase, and I also had a sample of an ore that was five hundred grams and a sample of ten grams that they finally ended up with. So he asked me up behind his desk, and I had my hand lens with me, and I showed him how to use the hand lens. He was looking at these tiny beads of gold and even a one-milligram particle of gold is equivalent in a fire assay to a one-ounce-per-ton ore, which is very rich, and yet the bead is just very, very small. He was very much interested in this and kept asking me questions. The lawyer was sitting down there, standing down there just raging, but he couldn't say a word.
What it did, they had tried to use regression analysis on the data, on their assays. Regression analysis will take a number of data points and try to draw a curve through them that is supposed to represent the true, you might say, average, of these data points. But there was a lot of these data points that were way off of the curve in both directions. It turned out that anything over one gram of gold per ton--their analyses were way off, and if they had done their sampling and their assaying properly, or their assaying on the proper size samples, they would have known that the ore was 50 percent richer than they had thought it was. And that they would then have had to pay more for that 20 percent stock that they bought from Kalimantan.
So that was the key to the whole trial, and shortly after I got back from Australia, I talked with a lawyer and he said the judge had asked the attorneys how much longer the trial would take, because it was then six months already. CRA hadn't even had a chance yet to put any of their witnesses on. He said that they had told the judge it would be at least another six months, which would make the trial a year long. So the judge had told the lawyers that he was going to appoint an arbitrator, and they brought somebody in with a "Sir" in front of his name. I don't know who it was. The lawyer said, "There's not a chance that we can come to a settlement." But three days later he called me up and said, "We just settled." They settled for $125 million that CRA had to pay, which was--the client, Kalimantan, they thought if they would win, they wouldn't even get that much, and here they had a chance to settle and not spend any more money. The lawyers' budget for this lawsuit was $7 million. And there was this fellow from Plutonic Resources--I don't remember his name, I've still got his card--but he was in the court every day and I got to talk with him a little bit. But that came out very, very well. It all depended on the size of these little gold beads.
Swent:
Where was the trial?
Shoemaker:
It was in Melbourne.
It was in what they call their Supreme Court, but it is not equivalent to our States' Supreme Court, but that's what they call it anyway. I don't know what other courts would be called. It's in a very old building. It was built back in, I think in the middle 1800s. It was a big, stone building and all the stairsteps were worn, and they had pictures of the old-time judges. That is, paintings of all the old-time judges, and they were very, very imposing in those beautiful robes that they wore. Very stern-looking judges and some looked like hanging judges, but they had these fantastically beautiful robes. And huge pictures, they were over life-size. It was a very interesting time.
I don't think I'd better talk about this new case that I've mentioned, because we've been cautioned against saying anything about this lawsuit.
Swent:
Can you just say that you're involved in one? Can you mention that much?
Shoemaker:
I'm presently involved in another lawsuit in Australia, in which the plaintiff is Pegasus Gold, who I've already mentioned. They had put in a heap-leach at a place called Mt. Todd in northern Australia, about 100 miles south of Darwin. They had operated this heap-leach on a low-grade ore, for about a year, year and a half, and then they decided that they could make more money if they built a mill and used flotation plus cyanidation and carbon adsorption.
They had a consortium of three different engineering firms--one is based in South Africa, one is in Australia, and one is in Canada--do the engineering. The company did a feasibility study at first, and what I would rather call an engineering study rather than a feasibility study. Then they built the plant, which was supposed to be eight million tons a year, in capacity, and the plant only ran for about a year. It started in the first of 1997, in January and it only ran until about December of 1997. Of course that's when the price of gold was going down.
They claimed that everything was wrong with the plant, and that the engineering firms were liable. About all I can say right now is that they are suing for $330 million.
Swent:
And you're a witness for--Pegasus?
Shoemaker:
I'm a witness for the consortium of engineering firms. There are a number of us. Maurie [Maurice] Fuerstenau is another one, and Ron Roman is another one. He's an academic type. Then there's others from the United States, and then there's three others that I know from the United States that are working for Pegasus, one of which I've worked with on the Kalimantan lawsuit. We were on the same side on that one.
Swent:
Tell about your computer problems with all of this.
Shoemaker:
When they called me up and asked me if I would work for the lawyers for the engineering consortium, I asked that they give me a synopsis of the case before I would take it, because I don't believe in working for the sides that are wrong. After I said that I would work for them, they told me that I had to have Windows 98, and at that time I still had a computer that was about three years old. It was Windows 3.1. So I had to buy a new computer, and I didn't buy a new printer because my printer was quite new. They sent me a couple of floppy disks and after installation of those disks in my new computer, I could just click on this icon that appeared in the main menu, and it would automatically connect me via the Internet to the attorneys' files, or to the attorneys' computers, in Sydney. Then I could look at all of the numbers of the documents, and they weren't sorted by metallurgy and mining. They were just miscellaneous--they were everything, every document that the clients had, that the engineering firms had, were on it and some of them were as long as a couple of hundred pages.
So I went through each one number by number eventually, and you had to call them up and you could find out what they were from the first couple of pages. I had a problem that I could not print any of them out, and it was useless to try to read these documents and try to remember everything you wanted from, say, a 200-page document. So I told the attorneys that I was having problems, and I also talked with the people who I bought my new computer from. They sent out a very good technician, and he talked with the lawyers' computer expert, and we found out that the program that all of these documents were on would only print out on old Hewlett-Packard printers, plus a couple of other printers that I never heard of.
So the lawyers' man told me to go out and buy a newer printer that would be compatible with these very old Hewlett-Packard printers, and that they would pay for it. So I did, and the computer people brought it out and it would print. However, the printing took eight minutes per page, and it would also only print out these documents that were supposed to be printed out on a Hewlett-Packard printer and not the ones on this Huey printer, whatever that was. So the attorney, shortly after that, came to Los Angeles, and I don't know what he was doing there but he tried out this system. He called me up and he said that he agreed with me; it was a terrible system and it wouldn't work, and he apologized because I was the guinea pig on this system of document retrieval. He decided that he would put all of these documents onto a CD-ROM, or several CD-ROMs, and send the CDs to me and then they would print out on any printer that I had. So that's the way it has been, and he has done the same with the other expert witnesses that he has called on for this project.
Swent:
So you don't have to wrestle with tons of paper any more.
Shoemaker:
Australia was the first court that I've ever been in that the court stenographer, who was of course using a stenotype--the stenotype was connected to a computer that translated what she was typing and the judge and each one of the attorneys had a monitor in front of them. When I was testifying, my translation of what I said appeared in front of the judge and those attorneys instantly. I had never seen that before. And then my morning testimony was printed out and given to me at five o'clock that evening so I could read it and make any corrections on it and bring it back in the morning so that they could print out the final version of it. Remarkable, really.
Swent:
Was it an accurate transcription?
Shoemaker:
I had really very few corrections. I think if I had had an Australian accent, it would probably have been perfect.
Swent:
Right. It was a foreign language, wasn't it?
Shoemaker:
It was remarkable. I had never heard of that before, and I guess it's here in the United States now, but I've never seen it. And I've talked to lawyers who said they have heard about it but they haven't seen it.
Swent:
The old stenotype seems a little bit antiquated now, doesn't it?
Shoemaker:
Yes. But to have this very latest thing in this old, old courtroom with all the attorneys, or barristers, in their black robes and the judge, too, in the white wig--and then of course the solicitors were there, too, but they couldn't talk. They're not permitted to talk.
Swent:
Well, that's a wonderful experience.
Shoemaker:
Lawsuits to me are very enjoyable because you're always matching wits with an attorney.
Swent:
So you're enjoying this new trend in your career.
Shoemaker:
Yes, I think so. I have a certain amount of reservations about this one, which I can't talk about, but anyway, it is interesting. Very interesting.
Swent:
I would guess this is something you had never anticipated doing.
Shoemaker:
No. I'm reminded of my statement about mistakes--that there are no new mistakes in this business. They're all old, tried-and-true mistakes.
Swent:
You had said that you could talk for a whole day about cyanide, but we don't have time now.
Shoemaker:
I was going to talk a little about theft.
Swent:
We have a little bit left.
Shoemaker:
And I have got some about cyanide here, which I'd like to talk about, and some of these scams I've encountered.
Swent:
We have a little bit more on this tape and I can always run up and get another tape.
Shoemaker:
Well, I think I'd better be going. Why don't we just talk a little bit about gold theft, Carlin being the first plant--I'm not sure, maybe this one was in my memoirs. I'm pretty sure the one about Carlin and also Alligator Ridge. I think I've probably talked about the theft of silver and that fellow over in Spain who was stealing silver chloride by putting it in his shoes. Maybe we could leave that until later.
Swent:
All right.
Shoemaker:
Yes, why not? It would be a good time to stop. It won't take too long to do the rest of this, but I think it would be-- I've got an awful lot of notes here about cyanide, but it won't take too long. I think we should stop, though. I can come down again.
Swent:
The weather is kind of coming in, so I don't want you to get caught in a snowstorm.
Shoemaker:
Yes, it's supposed to be down to 2,500 feet tonight.
Swent:
You're right about there, aren't you?
Shoemaker:
We're at 3,150. I doubt if there would be very much of it tonight because it's too early in the season. Probably only a couple of inches; otherwise I'd have to be out in the morning plowing snow.
Swent:
We don't want that.
[Interview 4: June 9, 2000]
Swent:
We're in the Strouse Press Room at The Bancroft Library, and this is interview number four. Our last interview was in December, wasn't it?
Shoemaker:
I think so, yes.
Swent:
That's quite a while ago. You had some more consulting jobs that we wanted to talk about.
Shoemaker:
The first one I wanted to talk about was the Chimney Creek, which was fifty miles north and east of Winnemucca, and owned by Gold Fields, who I had consulted for for a total of about fifteen or seventeen years. This was a gold mill, 2,000 tons a day, and there was no electric power up there. It was about seven or eight miles farther north than the old Getchell mine that Newmont had an interest in many years ago. The power line to the Getchell was not sufficient to supply power for Chimney Creek, but the Chimney Creek was about twenty-four miles in a direct line to the Valmy power plant that was owned by Sierra Pacific. You could actually see the power plant, which is alongside of Highway 80, and it was a coal-fired power plant.
When Gold Fields contacted the Sierra Pacific, they wanted just an outrageous amount of money for running a new power line and putting in new transformers and the total cost would have been somewhere around 9¢ a kilowatt hour. So Stan Burns, who was Gold Fields' electrical consultant, got hold of Harney Electric, which was a Rural Electrification Administration power company up in southeastern Oregon, that got their power from Bonneville [Dam] Power Authority, and they gave a quote which was a couple of cents cheaper than Sierra Pacific's quote.
Swent:
Even though it was much farther away?
Shoemaker:
Yes. And Sierra Pacific then wrote Gold Fields a letter and said that if Gold Fields bought power from Harney Electric, that Sierra Pacific would sue because they claimed Gold Fields' plant was in their sphere of influence. This would hold up the construction of the plant by at least a year, or maybe more, and so Stan Burns, who's a very good friend of mine, had a good idea: There was a natural gas line that ran along Highway 80 and he got hold of the gas company and got them to quote on supplying gas to the plant. He priced out a set of--
Swent:
That is gas to the Chimney Creek plant?
Shoemaker:
Chimney Creek plant. It would have been a twenty-four-mile pipeline, and he priced out a gas-diesel power plant. There were four gas-diesel engines in it, and it turned out that, all in all, not only the construction of the pipeline, and the construction of the diesel plant, but the cost of the gas, it all came out to another two cents saving, so they got their power for five cents, and said to Sierra Pacific, "Heck with you," and Sierra Pacific couldn't do a thing about it. Sierra Pacific was just trying to hold them up, which really is highly unethical, but some corporations are like that.
Swent:
Is this unusual to have a gas-diesel plant?
Shoemaker:
Well, there's a lot of plants that have diesel plants. A lot of mills have diesel plants, but not particularly in the United States, because there's so much power available. But other--Canada and other countries do.
Swent:
It's a combination. They got the gas from the gas line and then they had to bring diesel in some other way?
Shoemaker:
Diesel with electric generators attached to them, so they generated their own power.
Swent:
But where did they get the diesel fuel?
Shoemaker:
No, these were diesel engines. In other words--
Swent:
Oh, diesel engines!
Shoemaker:
Like a gasoline engine.
Swent:
Okay, I was thinking powered by diesel oil.
Shoemaker:
No, they were powered by gas, but it was still a diesel engine.
Swent:
All right.
Shoemaker: So they ran along for several years that way and then Santa Fe Pacific, which was Santa Fe Railroad who took over Southern Pacific, they found a deposit just about a mile south of Chimney Creek on their own property. This was the old railroad checkerboard, you know, that they got every other square mile way back in the 1860s, for I think twenty miles on either side of the railroads. Anyway, they found this deposit.
Swent:
Of coal?
Shoemaker:
No, it was gold. And so they decided to build a gold plant. And then when they contacted Sierra Pacific, Sierra Pacific had had a lesson and they brought their power price down to where they equaled the price that Gold Fields was paying for their gas-diesel power. And eventually Gold Fields was sold to Santa Fe.
Swent:
Chimney Creek, that is?
Shoemaker:
Chimney Creek was sold to Santa Fe, and then the Chimney Creek plant was connected up to the Sierra Pacific power line and they sold the gas-diesel plant for more than it cost them. It's kind of amusing that Sierra Pacific Power was taught a lesson at their expense.
Swent:
Now, who do you sell a power plant to?
Shoemaker:
Oh, I don't know who bought it, but some company that was not near a power line or that wanted some standby power bought it. It was kept in perfect condition--it was just like new. Really nothing ever goes--well, the pistons and the cylinders--the cylinders had sleeves on them, and so when they get worn, you replace the sleeve; you don't have to replace the whole engine. And bearings are replaceable and so it was a beautiful power plant and it just ran like a clock.
Swent:
Did you do the metallurgical work there at Chimney Creek?
Shoemaker:
Oh, yes, I did all the metallurgical work because I was, in effect, Gold Fields staff metallurgist. They never had one, and so I took that place. I was in charge of all of the research on all of their prospects, including--well, I did the same with Mesquite down in southern California--their heap leach, and then other prospects that weren't developed.
Swent:
Is there anything special about Chimney Creek?
Shoemaker:
It was probably the best-designed gold plant that's probably ever been built. Gold Fields kept their plant manager, the mine superintendent, the mill superintendent, the chief metallurgist, and the maintenance superintendent at the Davy-McKee offices over in San Ramon, and I was over there every week. And Bob Thurmond, their consulting mining engineer, was there and so was Stan Burns, the electrical consultant.
Swent:
This is during the construction?
Shoemaker:
During the design. And so we very, very closely supervised the engineering firm, Davy-McKee, and these were all operating people that we had. And it turned out to be the prettiest plant.
There's one thing to say about that Chimney Creek. Gold Fields of London was the owner, but they owned Gold Fields-USA and they were bought by a very large English conglomerate, Hanson PLC. But before that conglomerate bought Gold Fields and later sold Gold Fields-USA to Santa Fe Pacific, Newmont took a run at Gold Fields and I got a call from Bill Brown, who was the president.
Swent:
President of Gold Fields US?
Shoemaker:
President of Gold Fields US. And he asked me to charter a plane and come over to Chimney Creek the next morning to take the Newmont metallurgist around the plant. Newmont sent a team of metallurgists and a team of mining people and geologists. And Bill didn't want his people taking these Newmont people around, so Bob Thurmond came up and took all the mining and exploration people around, and I was the host for the metallurgists.
The metallurgists were headed up by a young fellow by the name of Jim Komadina, whose father was quite a famous metallurgist; his name was George. George Komadina had been chief metallurgist at the Sierrita plant which was owned by one of the oil companies. It was a copper plant, very large, south of Tucson. And Jim Komadina I had known casually and he was--he was full of himself. We started out at the primary crusher and this was a very nicely designed crusher and it was kept just spotlessly clean. It looked like it cost a lot of money, but it didn't; it was just a very good design. And Komadina, after we finished the tour and went back into the office in the conference room to talk about it, he says, "Why did you build such an expensive primary crushing plant?"
And I said, "Well, there was one reason." I said, "We didn't want to build a complete abortion like you people put in over at Gold Quarry," which was Newmont's big plant that's over near Carlin. Oh, he was very angry. But he finally got calmed down.
The primary crusher at Gold Quarry was just terrible. It was--it isn't even worth looking at, or describing, it was so bad. And he didn't like me saying so.
Swent:
[laughs] Well, now, it would seem to me that after all these decades of crushing, that designing a primary crusher would be more or less standard. What can you do?
Shoemaker:
People still make the same mistakes over and over again, and there's not very many people that really ask questions and take advantage of other people's experience.
Swent:
What are the variables in a crusher that make it so tricky?
Shoemaker:
Well, this one at Gold Quarry, they put in a jaw crusher, which was smaller than it should have been, and they had to--
Swent:
Now what does that mean? Because the size or toughness of the rock, or the quantity that they wanted to put through?
Shoemaker:
Well, it was partly both. But a jaw crusher has to be fed by an apron feeder; you can't just dump a truckload of rock into a jaw crusher like you can with a gyratory. And they put in a grizzly in at the bottom of the dump pocket. This is the large stationary screen, you might say, with openings that were say three feet square, or four feet square, and the dump pocket had this apron feeder underneath it that fed the jaw crusher. Well, first of all, it fed a vibrating grizzly that took out the finer material and then the oversized went into the jaw crusher. The dump pocket was very deep. It was about, oh, I would say twenty-five feet deep and they were using 150-ton trucks to dump into it. When the truck got its bed elevated and was doing the dump, the total drop into that grizzly was close to fifty feet, and dumping boulders that were four and five feet in diameter. The grizzly just sagged in the middle and sagged so badly that it had to be rebuilt about three times during the first couple of months of operation.
Then below that, there was another 75-foot-long apron conveyor, and it had to be a steel apron conveyor because the undersized rocks from the grizzly were dropping quite a distance; you couldn't drop them on a rubber belt. Anyway, the whole thing was about 100 feet high, and it was built in a hole. It was almost a half of a conical hole, with very steep sides. And they started this up in the winter time, and during the first week of operation, a maintenance truck went down this slope to do something--maintain something--and the slope was icy and the truck just slid. They couldn't stop it, and it collided with the electrical transformer. The transformer of course was smashed, and so was the truck, and they had to shut the plant down for about a week until they could get a new transformer. It was a poor design all the way through.
Swent:
Well, I interrupted you. You said the jaw crusher was too small.
Shoemaker:
They replaced it after a couple of years with a gyratory crusher, and it was built more along conventional lines. As I say, people just--[Frank] McQuiston and I wrote this book on primary crushing plant design and the book outlined all the mistakes that had been made on various crushers and made recommendations for how one should be designed.
Swent:
So you took your crowd through the Gold Fields plant?
Shoemaker:
Yes, we went all through the plant, but anyway, Newmont decided not to buy Gold Fields at that time. But it was interesting shepherding those people around and answering all their questions.
Swent:
Did you ever go back? Were you ever called back to do anything after it operated?
Shoemaker:
Well, after it was sold to this Hanson P.L.C. out of England, I only went back there I think twice. Then the manager that Hanson put in--he knew nothing about mining and had never been connected with mining before. He said mining can be run just like any other business. Anyway, he didn't want to pay a consultant, so he told Bob Thurmond and I that we weren't needed any more, so I never went back. Later on, of course, Santa Fe bought it and then Santa Fe was absorbed by Newmont, so Newmont eventually got the plant.
Shoemaker:
One of the people--the vice president of finance for Gold Fields--was named Tony Cialli. When Hanson took over Gold Fields, they put in their own people, so he lost his job. And somehow he got--well, he knew some of the Consolidated Gold Fields board of directors in London, and one of those had an interest in a consortium of financiers that somehow had got a hold of a gold prospect in Venezuela. They made Tony a vice president. He lived in New Jersey, and they built a gold plant in Venezuela, and it was designed and built by Bateman Engineering out of South Africa. The Bateman construction manager was then hired as manager of the plant. He was a construction man and didn't know anything about running a plant, and this consortium had hired no consultants to look over Bateman's shoulder and the plant was--it just didn't run very well. It was just full of faults.
Swent:
What sort of plant was it?
Shoemaker:
It was a gold plant.
Swent:
What kind of process?
Shoemaker:
It was a cyanidation plant, and it was built--
Swent:
Excuse me--we didn't find out what was the Chimney Creek--that was a heap leach?
Shoemaker:
Chimney Creek was a milling plant--milling and cyanidation. Later a heap leach was added to treat low grade ores.
Swent:
Thanks. Now, back to the plant in Venezuela.
Shoemaker:
It was a gold plant, and it was a milling plant and used carbon-in-pulp processing. The ore body was actually not in situ: it was tailings from a whole bunch of little independent miners that had been mining in this area for a long, long time. They dumped their tailings into a very small creek and as they came into this valley, well, the tailings spread out and they were twenty feet thick there for quite a ways.
Swent:
Where is this located?
Shoemaker:
It was to the east of Caracas. It was over near the British Guiana border. You had to fly east to a city, I can't remember the name of it, which had a couple of big aluminum plants, and then drive a long, long distance. But anyway these tailings had some gold in them, supposedly, and--Bateman had done the test work, and based on Bateman's test work, they put in the plant.
But it turned out that the tailings were much lower grade than the samples that Bateman had taken. They did a poor sampling job. And the plant was very poorly designed and it was very inefficient. They weren't making recovery even if the gold had been what they thought it was. And in addition, this manager was--his name was John Brownlee. He was a Scotsman, and he talked continuously; you couldn't interrupt him. But he was on the take.
It turned out that he had gotten kickbacks from every subcontractor that was engaged to build the plant, and it turned out that he was also getting kickbacks from the independent truckers that were excavating these tailings and hauling them to the plant. He also had the chief chemist falsify the assays and increase the assays of each load on the truck. But anyway, Tony--
Swent:
When you come into a place as a consultant, how do you find out this sort of thing?
Shoemaker:
Oh, just because I always look for these things.
Swent:
All right. [laughs]
Shoemaker:
Anyway, Tony Cialli asked Bill Brown, who had been president of Gold Fields U.S., and Bob Thurmond and I to go down and take a look at this plant. We were pretty well horrified at everything that was going on. They didn't have a mill superintendent; Brownlee had a foreman, is all, who didn't really know--he was a Venezuelan and he had worked in mills, but he wasn't really very experienced, and so we told Cialli that he had to get a competent mill superintendent. He agreed under protest and I, when I came back to the States, got a hold of Joe Young, who was the old superintendent at Homestake's mill, or had been, up at McLaughlin. Joe Young had worked for me when I was at Bechtel. He was Chinese, but he'd been born in the States and is a very good metallurgist.
So he went down there and found all of this out by working there, and found that the assays were off and he found that Brownlee was taking kickbacks and he also found that there were two or three people had found a way into the refinery. They would crawl through a couple of electrical ducts and get into the ceiling of the refinery and come down some pipes and you could see their footmarks on the wall [laughs] and stealing gold there.
The company was just not making any money and this consortium of financiers had to contribute more and more money to keep it operating. Then the three of us--Brown, Thurmond, and myself--we went down there again after Joe Young had been there for a couple of months and when Joe told us all of this--
Swent:
He was able to tell you in person. I suppose he couldn't have written a letter.
Shoemaker:
No.
Swent:
This is kind of tricky, isn't it?
Shoemaker:
Of course he had to report to Brownlee. And when you report to a crook, well--
Swent:
You have problems.
Shoemaker:
So he told me all of this, and I told Bill and Bob Thurmond.
Swent:
What were the circumstances of his telling you?
Shoemaker:
Oh, I went to his house. They had a camp, or a company village, you might say. And Joe Young had to confide in somebody because he knew that things were going wrong and it wouldn't do any good to talk to Brownlee. So we told Cialli that he had to fire Brownlee, and Cialli wouldn't do it. So anyway, Brownlee promised to make Joe Young the operating manager, and Brownlee was going to be in charge of building a second mill on another ore deposit which was fifty, sixty miles away. But that never happened and after a couple of more months Joe Young quit. Eventually the financiers stopped putting up money and the plant was sold and Brownlee was out of a job.
Swent:
What was the name of this operation?
Shoemaker:
It was called La Camorra. It was very close to a town called El Callao.
The sequel to that story: Newmont put in a very large heap leach operation in Kazakhstan in Russia. There was an article in one of the mining journals and it mentioned John Brownlee was there as construction manager. Later on they had a manager, but he was still there, doing more construction. A friend of mine was working for Newmont and they sent him over there, and I happened to be talking with him one day and asked him how Brownlee was doing. He was very negative about Brownlee and he didn't want to say too much, and I said--well, I told him what had happened down in Venezuela. Then he opened up and said he's doing exactly the same thing in Kazakhstan at the Murantau plant, which is one of the largest gold mines in the world.
This was on their low-grade material that had been stockpiled for many, many years. This was the same plant that when I was at Bechtel, I mentioned that the CIA came with photographs taken from the U2 spy plane and wanted to know how much production could be put through in that plant--I think we talked bout that.
And I said to my friend, "Well, did you tell the Newmont management about this?"
He said, "Yes, but they haven't done anything and Brownlee is still there."
Shortly after that, I was at a Society of Mining Engineers meeting in Denver, and at the Mining and Metallurgical Society luncheon, the speaker was Ronald Cambre, who was chairman of Newmont at the time. I had met Cambre before at the dedication ceremony of the Gold Quarry operation that we just discussed. And so before the meeting, before the luncheon started, we were--they had cocktails there ahead of luncheon time, and I went up to Cambre and reintroduced myself and asked him if I could have a word with him. I told him about Brownlee and my experience with Brownlee, who was an absolute crook, and that I had also heard that he was doing exactly the same thing in Kazakhstan for Newmont. He thanked me very much and there was never anything done about it. Brownlee was there for another year and a half.
So these things always puzzle me, how the chairman of a company could tolerate something like it. The least he could do is investigate, and he never did.
Swent:
Maybe he thought that that was the way of doing business in Russia.
Shoemaker:
Well, in Russia you have to pay off a lot of people; you don't have to, but it makes it easier. But it shouldn't be done, and there are plants being built in Russia which do not do that.
Swent:
Just as an aside, but speaking of Newmont and Russia, you were talking about this other mine, Chimney Creek, that belonged to Gold Fields and Newmont was trying to buy it. Plato Malozemoff's father worked for Gold Fields in Siberia. Long ago, nearly a hundred years before. He managed a mine for Gold Fields.
Shoemaker:
His father was a manager of the plant.
Shoemaker:
I wanted to talk a little bit about--relate a few instances about theft of gold. Carlin, the Carlin mill of Newmont, which was the first gold plant that Newmont had built in thirty years--in fact, it was the first plant that had been built in the United States in thirty years. This was in 1964. They had a theft.
It turned out that there was a jewelry manufacturer in Chicago--and this is at the time when it was illegal to have gold, you know, unless you had a license from the [U.S.] Treasury [Department]. The Treasury people had been keeping their eye on this jewelry manufacturer because they thought he had more gold than he had a right to have, and so they began following the owner. They followed him to Reno and he met in Reno a couple of men who it turned out, when they started following them, that they were working for Newmont at Carlin. And so the Treasury agent went to Jay Macbeth, who was manager of the plant at the time, and told Macbeth that some of his people were stealing gold. He couldn't believe it, but they convinced him.
It turned out that the chief chemist and two of the refinery people were in on it. The chief chemist was cooking the books, so that his calculations of how much gold that was produced was verified by his assays. And so he was covering up the theft out of the refinery by that. They were stealing zinc precipitate that they recovered the gold in.
These three fellows had been stealing gold for about a year, and they had stolen, it turned out to be over a million dollars. They had quite a high old time. When one of them would have a birthday, the other two would arrange with one of the local houses of ill repute there at Carlin to throw a party for the third guy, and he would have a wild weekend with several women. Anyway, they arrested all three of them but they only got about $40,000 worth of gold--$40,000 back. One of the men had put all of his money in his wife's name somehow and she got away with it, and there wasn't anything more to recover; they had spent it all.
Only the chief chemist went to jail, and he was only in jail about four months. He later became chief chemist at another plant over in Nevada, and the manager of it told me that he was the most honest fellow in the whole plant.
Swent:
Oh, really. [laughs]
Shoemaker:
He had completely changed his ways. I knew him and I talked with him. I was consulting for this other outfit and he told me all about it--that he just lost his head and he would never do it again.
Swent:
Well, that's kind of nice.
Shoemaker:
But they got Frank McQuiston back over there and Frank went over the assays of all the blast hole samples and the chief chemist had not cooked those; he had only cooked the assays in the mill, so Frank was able to back calculate from those assays of the blast holes and compare them with what their production was and establish to the insurance company's satisfaction that there was a million dollars that they had stolen, and so the insurance company paid Newmont off, that million dollars.
Swent:
I'm surprised you could be insured against that kind of thing.
Shoemaker:
Well, they had insurance.
Swent:
Well, that was smart.
Shoemaker:
Another one was Battle Mountain Gold. I was hired by Battle Mountain Gold because their chief of security had quit, and some three months after he had quit he came down with a bad case of mercury poisoning. Mercury poisoning can be fatal, of course, but he recovered. He went to the hospital and he did recover.
They had been using amalgamation with mercury in the plant because they had coarse gold. The company refused to pay him because they had been taking blood samples from him on a regular basis. Anyone who was in the refinery or around the gold room where the coarse gold was and the amalgamation was taking place was checked on a--I think it was a bi-weekly basis--for mercury in the blood. And his--I've forgotten the figures now, but he had a slightly elevated mercury content, like any of the people that worked there in those areas, but it was way under what the government would say is dangerous--the EPA and so on. However, when he got the mercury poisoning, after he had quit, they analyzed his blood and it was about 300 times the allowable limit.
He was on workman's compensation, but he was going to sue the company. The company didn't want to pay him because when he left, his mercury in his blood was very, very low. And so I went over and I looked at the whole place and they did have--the mercury retort they had was very poor and it was leaking, but no one else had got any high levels of mercury in their blood. And so I told them that they had to get a new retort with much better seals on it, which they did.
Then I talked to a toxicologist here in San Francisco who knew a lot about mercury and he verified my thoughts, that there was no way that if his mercury level in his blood was normal when he left his job, that three months later it could be 300 times more, so I told the company that they'd better go and get a subpoena and take some samples in this man's garage or his house or wherever, which they did.
It turned out that there was all kinds of mercury in his garage because he had been heating this amalgam, you know, on an open gas flame. [laughs] That's where he got the mercury poisoning.
Swent:
He was stealing?
Shoemaker:
He was stealing gold. Stealing amalgam.
Swent:
Processing it himself at home?
Shoemaker:
Yes, processing it in his garage. So the man couldn't sue them, and they didn't try to put him into jail because it would be so hard to prove and he was gone anyway. At least they didn't get sued. He had a lot of gall to sue the company for that.
Swent:
I would think so. [laughter]
Shoemaker:
I guess the state cut his workman's compensation off, too, because he got it illegally.
Shoemaker:
Another one was Alligator Ridge, where we built the heap leach plant. At the dedication where they had the governor of Nevada give his speech, and there were other speeches, I was standing --and they had, you know, they had food and beer, and all kinds of soft drinks and everything and there were a couple hundred people there--and I was standing talking with a man by the name of Don Koza, who was a manager of a gold plant down in Pioche, Nevada, and who I had known. There was a bunch of guards, security people around. There were half a dozen of them and they had pretty sky-blue uniforms on, brand new. Don started to laugh and I said, "What are you laughing at?"
And he said, "You see those two guards over there in the pretty uniforms?" I said, "Yes."
And he said, "I fired them for stealing two months ago."
Swent:
Uh oh. [laughs]
Shoemaker:
It turned out that about four months later they found that these guards had been stealing gold. They were the head of a ring of about six people that had been actually stealing carbon--loaded carbon from the carbon-in-leach plant. They caught them, and I think one of them went to jail, the chief of security. I don't think the other ones did.
But you see, with carbon, normally you like to keep the concentration of gold in the carbon that absorbs the gold from the cyanide solution. You like to keep it fairly low, and some people don't--I don't know why these gold companies are so casual about these things, but I've seen a number of companies that load their carbon to as much as 500 ounces of gold per ton. But if you load it to 500 ounces of gold per ton, then one pound of carbon contains a quarter of an ounce of gold. You can put a pound of carbon in your pocket, and that's seventy-five dollars worth. They can take it home and just burn off the carbon and recover the gold.
It's amazing that these carbon plants very seldom have screens over the carbon columns. Carbon is very easy to steal, and they don't check these people. Even so, if they would check them with a--occasionally they'll check them with a magnetometer, but that won't show up on a magnetometer because the gold is in a form of gold cyanide, which isn't magnetic at all. Gold is not magnetic either. And in foreign countries, when you have laborers who work for two, three, four, five dollars a day, and they steal a pound of carbon worth seventy-five dollars, the temptation is extremely high.
Shoemaker:
Here in the United States when these operators are making $40,000 a year, the temptation is less, but it's still a temptation, and there's still a lot of gold stolen. Very often when you have a theft, very often it involves the security people that they hire, because they are not paid very much. They're paid not much more than minimum wage, so that they are susceptible to temptation.
Shoemaker:
When I was at some of these operations, they all had guards and some of them would have these magnetometers, but they were very casual about their use. At one down in Brazil, which I've already talked about--Fazenda Brasiliera--after they got the plant up and going, I was just trying to tell these people, the managers and the people I was working for, that they ought to cover their carbon columns. This was a heap leach operation. And, nah, they couldn't get much interest in it, so I took a--I found a piece of steel that weighed about a pound, a short piece of flat bar. I put it on top of my head and then put my hard hat over it, and when I went out of the plant, of course they ran the magnetometer over me, but they never got above my shoulders, and they never got below my ankles to my shoes, and when the guard passed me through along with the superintendent, and the plant manager I was with, as I went through, then I took off my hat and just dropped this big piece of iron on the floor. And the manager of course was very embarrassed. And so the next time I was there I found that he had put screens over the carbon columns.
Swent:
His recovery was better?
Shoemaker:
That was my last visit and I don't know what happened, but I'm sure that they were trying to steal gold. They all do. I don't think there's a plant in the world that hasn't had a theft. One of them was Homestake at Lead. And this was kept very quiet. I don't know whether you ever heard about it.
Swent:
No, I've always been curious about it. I've heard many mentions of it, and I've never heard the story. I'd love to hear it.
Shoemaker:
Well, they had guards. I don't know how they got onto it, but this had been going on for years. It was people in the refinery who when they would pour their ingots, they would also pour very small ingots, maybe five or ten ounces--something like that. They would put these small ingots in some of the electrical boxes, starters for the motors, or an electrical panel. Then they would call the maintenance shop and say that they had some electrical problems and they would send over this electrician with his toolbox. Of course he would go in and he would go to this electrical box and he would take the gold out and carry it out in his toolbox, which they never searched.
Then another way of doing it, they took the slag from the refinery and put it in barrels, and the slag contains a little bit of gold. Rather than putting it out on the dump, they sent it back to the crushing plant on the surface. Primary crushers were underground and this was the secondary and tertiary crushing plant. They would hide small ingots of gold in the top of this slag which they had crushed in the refinery, and put it in a sack or a box or something and hide it under the slag and then this would be sent back over to the crushing plant where the man would know--they would put a mark on the barrel, and the man would open the barrel and recover the gold. Apparently this had been going on for years.
And so they asked Frank McQuiston to come and help them out. And Frank never told me very much about it, except that he was doing this and he was helping them out by making calculations of what they should have recovered. They wanted to keep it quiet. It never got into the newspaper. Most of these companies, they are very embarrassed and they don't want the word to get out that they're subject to theft.
Shoemaker:
The last one I have here is Candelaria, the silver heap leach plant we built when I was at Bechtel. We built it over south of Hawthorne, Nevada, about fifty miles. You have to steal a lot more of it in weight than you do of gold. But the filters that collected the zinc precipitate were in the refinery room--you pre-coated the filters with diatomaceous earth in water, to make a filter media on the filter cloth. This tank in which they mixed the diatomaceous earth with water was outside of the refinery, and by changing some valves--opening some valves and closing others--inside of the refinery, they could make pregnant solution containing gold flow back into that tank. They put a sack that had powdered zinc in it and they tied it around the end of this pipe that went into this tank and of course it precipitated a lot of silver.
I don't know how they found that, but the manager is a friend of mine and he told me how it happened. So those are just examples of how gold and silver can be stolen.
Swent:
They have to be very ingenious, don't they?
Shoemaker:
They can think up methods of stealing it faster than you can think up methods of preventing it. So even the best of them--like Homestake and Newmont--they've had bad experiences. I went through the Rand refinery in Johannesburg and I got special permission to go through that. They just didn't allow any general visitors and I got some people at Anglo-American to permit me to go through. Of course that's the largest refinery in the world and it is huge--and I'm sure they have never had a theft because the search that you have to go through coming out of that refinery is a little bit embarrassing to describe because you have to go through there naked and they investigate you very thoroughly. They look into your mouth and they x-ray you to see if there's anything in your stomach.
Swent:
Do they do this every day for all their employees?
Shoemaker:
Yes.
Swent:
That would give you quite a load of radiation, wouldn't it?
Shoemaker:
Well, it's very low dosage. And they also investigate your body cavities. I don't think they've had any thefts. There are no exceptions. Managers go through this. But this Rand refinery is owned by all of the gold companies down there, and I'm sure the government has an interest in it, too. It is a fantastic refinery.
Swent:
So that's the only way to be sure, is to have an extreme caution.
Shoemaker:
Before I quit I want to talk about some scams and then I want to talk a bit about cyanide and that's all. If you want to break now--
Swent:
Well, let's do.
Swent:
We are continuing here after a short break. You wanted to talk about mining scams?
Shoemaker:
That's correct. A friend of mine who is a geologist worked for Rio Algom in Canada. They had been approached by a man in Washington who told them that there was this mountain of silver not far out of Cle Elum and sounded like it was crazy, but they couldn't afford to not look at it, was the way they felt. This geologist didn't know much about sampling and he knew that I did, and so he called me and I met him up at Cle Elum.
We met this man, and this was shortly--actually we had to put it off for a while because this was right after Mt. St. Helens erupted and it was on the east side of Mt. St. Helens, and Cle Elum still had just huge piles of this volcanic ash pushed up in parking lots and so on, and this mountain had three or four inches of ash all over it. And so we went up with him and took a look. And it was in a heavily timbered area of the whole mountain, and he claimed that there was silver just all over the place. So we agreed to meet him the next day, and I would take samples. We went back to Cle Elum and I bought two pieces of half-inch plywood and I rented a gasoline-driven post-hole digger--and we went back up there the next day.
The post hole digger would drill 6-inch holes and he said this silver was right on the surface all over the place, and so I cut a little over 6-inch-diameter hole in one of these pieces of plywood and this fellow that was a friend of mine, he helped me with the drill, the auger. There were handles on both sides of it. It was a quite heavy thing.
We also had an extension so we could drill down to about five or six feet. I had gotten a couple of wooden boxes to stand on when we were drilling that deep and we made this man stand about twenty feet away when we were taking samples. We would drill down and then the sample would come up through the hole in the plywood in the form of kind of a cone around the hole. We would scrape that away to one side and then drill a little further. Then we would transfer the sample, which was probably fifty-sixty pounds or more from the 5-foot hole--maybe even seventy-five pounds--to the other sheet of plywood. Then I had a shovel and I would cone and quarter this and work it down to a sample that was about five pounds and put it in a plastic bag.
Then I had purchased a very cheap tin footlocker--sheet metal footlocker--from a local variety store. In fact, I had two of them, but they did have hasps, and I bought a couple of locks and we would put these samples in the foot lockers. We worked two days up there getting these samples and we had filled up two of these footlockers and locked them; each time we locked them, even at nighttime when they were in my room. I would put them in my room at the motel.
The second day this man brought a fellow from Portland, a young fellow who had invented this process for recovering silver. He claimed he was a chemist. He wasn't. He vaguely described his process, because it was secret. And so anyway, after two days, I shipped the samples back to San Francisco and had Martin Quist, you probably know him, assay them.
Swent:
I've heard a lot of Martin Quist. I don't know him, but I've certainly heard a lot about him.
Shoemaker:
He ran an assay laboratory down in San Francisco. I can't think of the street now. And there was absolutely no silver in it. He did fire assays and there was absolutely no silver there.
Swent:
Of course Martin Quist didn't have that secret process.
Shoemaker:
That's correct, yes. [laughter]
I had done some work for Lurgi, which was a division of Metalgesellschaft, a German company--done some consulting for them. I worked for a man by the name of Arthur Bergmann, and he was a metallurgist and he worked with a fellow by the name of Hans Teichert.
This Teichert was quite a character. He had been in the German army at the age of sixteen and was captured by the Russians. They put him to work in an underground coal mine, and the coal seam was flat-lying and it was such a narrow seam that in the morning he could choose whether he would mine coal on his back or on his stomach. With a hand pick.
Swent:
Oh my!
Shoemaker:
He would push this coal back to another fellow, who would pull it back, and they would eventually get it onto cars. He said a lot of prisoners died there and he was starved, but then somehow either the coal ran out or--but anyway, he was transferred to a copper mine. They dug the copper ore by hand, by pick. He was one of the few to come back after war, and strangely enough he decided to become a mining engineer.
In Germany, like in some other countries, before they will accept you into a mining school you have to have a year's experience working in a mine, and of course he had all kinds of experience.
Swent:
Literally all kinds.
Shoemaker:
Yes. But anyway, one of Lurgi's or Metalgesellschaft's very large stockholders had been approached by some people in Texas. This company was called Houston Minerals, and they were asking this man to sink a lot of money in a gold and silver mining development.
Swent:
Where was it?
Shoemaker:
They were going to develop a mine or actually several mines in Arizona, and the promoter was there. I met both Bergmann and Teichert in Houston and went to this Houston Minerals office where they had--I don't really know what those people did, but they didn't know anything about mining. They had their consultant there who had developed this process. This promoter--I don't think I had better give you names because he's still alive. He was going to develop these gold mines--several gold mines--and connect them all together by computer, and he was going to run them by computer.
Swent:
Oh, good.
Shoemaker:
And he would only have a manager and maybe one or two employees at each of these mines.
Swent:
What, he had robots or something?
Shoemaker:
He was a great talker and every time you would ask him a question he would dodge around it. But he was going to use what had been called the Haber process. A man by the name of Haber was back in New Jersey and he had a company that made dental alloys. It was a public company and it was a going concern, apparently.
But he got interested in recovering gold and he had a chief chemist by the name of Frye and they developed this process called electromolecular propulsion, [laughs] and this was what this promoter was going to use. It was a vat leaching operation and they would build these big vats and the vats would have an electrode at each end, and then they would fill the vat with ore and add water to it and circulate the water which contained his secret reagent, and with the electricity turned on, the gold atoms would hurl themselves--and I'm quoting him--at the electrodes. [laughter] Anyway, I told the Germans that this was a scam.
Haber was around for several years and was trying to sell his process to a number of people. He took over a place called Silver Reef. It was a mountain and it was called Silver Reef down in Arizona, and this promoter--that I referred to and wouldn't give his name--had originally owned the claims on this Silver Reef. Both Haber and this promoter were trying to sell this process to recover this silver, and Hans von Michaelis--you may know of him--he's a South African and he lives here in the United States and he has put on a number of--oh, I'll call them seminars. It has evolved into small equipment shows, and he has published some books that were originally supported by mining companies. He's a promoter himself and he's not a metallurgist, but he goes around and asks questions of every mine in the country--and in Australia and South Africa and so on. He has made a living at this, and he has done the industry a service, but you can't always believe what he says in his books.
I've got a shelf full of I think twelve volumes each a couple of inches thick, and he has brought these--he has added to these. I haven't gotten the rest. In fact, he gave me those twelve volumes free.
But [laughs] anyway, he held one meeting in Scottsdale and I went to it and he had this man Norman Haber give a paper. Well, von Michaelis shouldn't even have done this, but he would do anything--and I say you can't believe everything you read in his books. Haber got up on the platform and was trying to describe this process without giving any details, and I started asking questions. Some of the others picked it up and he was finally just hooted off the platform. It was a waste of time to listen to him. He got very angry about that.
And later, [laughs] I got a call from this man, Frye, the chief chemist. He wanted me to consult for them and endorse the Haber process to refine silver and gold from over in Nevada because he was under the impression that all of the gold and silver producers shipped zinc precipitate to the refineries and he wanted to put in a refinery using his own process. I told him that in the first place I wasn't interested at all and I thought the Haber process was a scam and, besides, none of the gold plants over there ship zinc precipitate. They all smelt their own gold.
Shoemaker:
Another one was--I think the last one I'll talk about--is Sonora Gold up at Jamestown, California. This was promoted by a young man by name of Agar, who was a geophysicist. He became a promoter and he promoted this Sonora Gold and sold a lot of stock, and then they built that plant at Jamestown. [laughs]
Swent:
Was that the one that was on both sides of the road?
Shoemaker:
Yes. They had a lot of problems getting permits, but they finally did, and they had a metallurgist working for them by the name of Joe Davis, who I had met when I was--actually when I was with Bechtel. We did some work for Copper Range, up in Michigan, Upper Michigan. Joe Davis was a nut.
Shoemaker:
He was a metallurgical nut. He was a metallurgist, but he had been working with thiourea, as a reagent to recover gold from ores. Thiourea has been investigated for--oh, I think--as far as I know it was first investigated as a gold leaching agent back in 1925, and no one has ever been able to make it work. It does leach gold under certain conditions, but it operates--to be efficient at all it has to operate within a pH range of about .2 on a scale of one to fourteen, and no one has ever been able to make it work. It's been tried by many people and it's still being investigated by a lot of university researchers who seem to believe that they can solve this problem--and also write a paper.
And so they got their permit to build this plant, and it was a good-sized plant. The gold was associated with pyrite and they were going to put in a flotation plant. They bought a flotation plant that had been a copper flotation plant down in Arizona, and that plant had failed. And that's another story, but I won't tell that one.
They bought this plant and they put it in, and then they were going to leach the concentrate with thiourea. He had convinced Agar and his bunch of vice presidents and directors who had gotten rich on selling the stock that they had allotted themselves, convinced them that this would work. He also convinced the county authorities that they were going to use theiourea, and that it would be non-toxic, and they wouldn't be using cyanide. Actually thiourea can be toxic--maybe not as much as cyanide, but that's another story. So they put the plant in and the thiourea process didn't work at leaching gold out of the sulfide concentrate. They couldn't change over to cyanide because the county wouldn't let them, and so they found a little carbon-in-pulp plant over in Nevada, west of Yerington, and about halfway over to Highway 395. I've forgotten the name of it, but it was put in by a promoter, and it was very cheaply built.
They started trucking this concentrate over the the pass. They didn't go over Highway 80; they went one of the other passes, I've forgotten, and went out of Sonora, over that pass.
And trucked that over there, and there were, I don't know, three or four big truck and trailer loads a day, and they were going to cyanide it there. Unfortunately the plant was built so cheaply, it wouldn't work. They hired a fellow--a Canadian --as manager and then they were getting about 10 percent extraction of the gold out of this concentrate. This plant had been treating a so-called gold ore that was just full of copper. They had a tailings pond there and I don't know for how long it had been running, but it failed, and there were probably a few thousand tons of tailings there with copper in them.
Well, making only a 10 percent recovery of the gold was a disaster. The pyrite concentrate, which became tails--leached tails, went out and got mixed with this copper. And so the manager of the plant at Sonora, who I had known slightly, called me and asked me to go over to look at this carbon-in-pulp plant.
I wrote him a report and I told him that he ought to hire somebody that knew something about carbon-in-pulp plants as a manager. I outlined what I thought the changes needed to be, and they would have to hire an engineering firm, which they did. And I didn't have anything more to do with it. I didn't want anything more to do with it.
But it took them a year to get their recovery up to about 90 percent. And you know, later on, that plant ran for about four years, but it never made any money, and finally failed, that is, the Jamestown plant did. And it's kind of interesting because even after a year when they were making a 90 percent recovery over there from the pyrite concentrate, it still contained about a quarter of an ounce of gold per ton. Barrick then bought all those tailings because they were running an autoclave plant over there in Nevada near the Carlin operation. They have this big autoclave plant over there north of Carlin, and they used the sulfides to furnish heat in the autoclave just like we were going to sell the Empire tailings to Homestake for the heat. I told you that story. But actually at Jamestown, all in all, it was a scam.
Swent:
They spent an awful lot of money on that plant, didn't they?
Shoemaker:
They spent an awful lot of money and a lot of the money went into the pockets of the promoters. They were more interested in the money that they could get from their stock that they had allotted themselves than they were in building a profitable plant. And hiring Joe Davis, who later ended up in jail for I've forgotten what it was--but he has been in jail for a number of years. Nothing to do with metallurgy. So I always considered that a scam.
Shoemaker:
I have another one. I ran into a fellow in Grass Valley whose name was Tom Newmark. He has some money and he dabbles in various things. I was talking with him one time. I had just come back from Brazil and I had mentioned it, and he said he had just come back from Brazil. He was down there buying semi-precious stones to sell up here, but he also said he had an interest in a mine in Nevada that they were getting ready to build a plant on. He said he had invested in it. And I said, "Well, where in Nevada is it?" And he said, "It's in the very southern part of Nevada."
I said, "Oh, you must mean the Moapa Valley."
And he says, "Yes." He says, "How did you know that?"
And I said that there's no mining, no gold plants in the very southern part of Nevada, except one called Castle Mountain, which is west of Las Vegas about fifty miles. And I said, "Moapa Valley is a hotbed of scams. There have been more scams over there promoted than any place on earth."
And he says, "Oh, no, this is a very honest group of people and investors."
I said, "Well, who are you working with down there?"
And he said, "A fellow by the name of White."
I said, "Oh, you mean Merwin White?"
And he says, "Yes." He says, "How did you know that?"
I said, "Well, he has been promoting scams all over in Arizona and Utah for a number of years, but he has never been caught."
He said, "Oh, no, he's a very honest man. He drives an old car and he wears bib overalls and he says he doesn't have a lot of money."
[laughs] Anyway, I said, "Well, I would be very careful. He is known for running these scams."
I periodically would run into him in Grass Valley and ask him how things were going and he would tell me that they were having little problems building the mill, and then they had run into some more problems, and finally he told me that he had had $80,000 invested in this and that one of his friends had $160,000 invested. And he said the last time--this was several months after I first met him--he admitted to me that I was right. This plant that they were building turned out to be on Bureau of Land Management land, [laughter] and BLM had come in with dozers and tore it down--tore down the plant, and there was no mine. And so he had lost his $80,000.
Swent:
Oh, that's a pity, isn't it, really?
Shoemaker:
People are just greedy.
Swent:
And it gives the whole profession a bad name.
Shoemaker:
Well, now maybe we can end up with a little talking about cyanide. Cyanide is really catching hell. The State of Montana passed a law against the use of cyanide in mining operations and the mining people were prevented from doing any advertising or lobbying against this proposed law. The environmentalists were, of course, very much against the use of cyanide. They had proposed this law, and yet somehow the state did not permit the mining companies to publicly oppose it by advertising or anything. And it passed. And there is now a bill in the legislature in Colorado for the same thing.
Swent:
What is the chemical formula?
Shoemaker:
Well, hydrogen cyanide--HCN, all capital letters--is what kills people. It is extremely poisonous, but the mining industry uses sodium cyanide, NaCN, carbon and nitrogen. It's a white powder that is compacted into briquettes the size of a charcoal briquette. And it's perfectly safe to use as long as you keep the pH up in the range of ten or ten and a half and generally around eleven and sometimes even eleven and a half. But if you allow the pH to drop around nine, then 50 percent of the cyanide is present as hydrogen cyanide. And hydrogen cyanide is a liquid, but it boils at about 75 degrees Fahrenheit and so a lot of it will evaporate and go up in the air, and so at all the mining operations, they keep the pH of their solutions very high.
Cyanide attacks the nervous system and you just suffocate if you get a dose of it. The cyanide process for extracting gold from ores is the oldest chemical process that has ever been invented, 110 years. No other chemical process is that old without major changes. In this hundred and ten years--the first cyanide gold plant in the United States was put in in 1889--there have been a lot of cyanide plants--thousands of them in North America, and we can only find two accidental deaths from using cyanide in gold plants in North America. This includes Canada, Mexico, and all the way down to Panama. And you can't say that for any other industry. It is a remarkable safety record. And there has never been anyone killed, that we can find, by a cyanide spill, or someone who doesn't work in a gold plant. There have been a lot of people who committed suicide by cyanide and there has been a lot of people who have been murdered with cyanide; cyanide used to be and still is relatively easy to obtain.
Swent:
It degrades, doesn't it?
Shoemaker:
In a solution. The nice thing about cyanide is that it is self-destructing. Under the influence of sunlight and the atmosphere--there is oxygen in the atmosphere--it very readily hydrolyzes and forms carbon dioxide and ammonia. For instance, in a pond that has cyanide in it, in the sunshine, cyanide from water in a pond will be gone in three days--something like that. If you spill it out on the ground as a solution, it will be gone in a couple of days and leave no trace.
If you get a small dose of cyanide accidentally, the symptoms are a lot like drowning. The average human--say, 160 pounds, something like that--it takes about 160 milligrams of cyanide--sodium cyanide--to kill a person. If you get less than 160 milligrams, you get sick, but you don't die, and the next day you are perfectly all right. There are no lasting effects if you ingest cyanide. If you get more, you die right away, but every cyanide plant has a cyanide kit that they use and it contains amyl nitrite and it's in an ampule you break under the person's nose and have them breath it and then you feed him oxygen, too--very quickly. If you get to a person that has ingested even enough to kill him, if you get to him quickly with a cyanide kit, you can save him.
But as I say, there's only been two in over a hundred years in the United States that have been killed by cyanide accidentally in a gold plant. No non-plant worker.
Cyanide is actually a fertilizer, and years ago they used to inject hydrogen cyanide into the ground to fertilize it, just like they do with ammonia today--inject gaseous ammonia into the ground; they used to inject gaseous hydrogen cyanide underground, as a fertilizer. The man had to wear a mask that drove the tractor, but it was used that way.
When I was working in the laboratory in Niagara Falls, we used flotation reagents which were xanthates. It was a very sticky reagent if it would get on your hands, and you couldn't wash it off with soap and water. It also smelled like the dickens and the only way you could get it off is wash your hands in a cyanide solution, and so we would keep a bottle of cyanide solution and wash our hands with that and then wash them with soap and water. There was no problem.
There had been cases of men wading through cyanide solutions in a plant, wading through a spill, and then wearing their wet shoes and socks for a day. There will be enough cyanide absorbed through the skin to make a man sick, but it won't kill him.
Swent:
Well, then these stories of spies that have a tiny little thing hidden in their tooth, or something, that's not--
Shoemaker:
Oh, yes, well, that may be true, I don't know. I've never been a spy.
Swent:
Would that be enough to kill you?
Shoemaker:
Oh, yes, 160 milligrams is less than the size of an aspirin tablet. But it is popularized in all these murder mysteries. There's actually cyanide in your blood; cyanide is a part of the DNA molecule. You have cyanide in your blood. You can measure it with today's modern instrumentation. There's literally hundreds of plants that produce cyanide. That so-called loco weed that kills cattle contains high levels of cyanide. They will eat a lot of it. Cattle, when they break through a fence and drink from a pond--cattle only drink out on the range every two to three days. They walk for miles to get something out there in the desert of Nevada to eat, and then they come back to the water in about three days and they will drink ten, fifteen gallons at a time, and that's enough to kill them in a fomide pond or in a tailings pond.
And of course the cattle that are killed are always the prize cattle. They are very expensive when you reimburse the farmer for his thoroughbred cows. A human drinking a normal cyanide concentration from a heap leach or a tailings pond would have to drink about three liters of solution all at one time to get enough cyanide to kill him. I challenge you to even drink three liters of water all at one time. You can't do that.
Swent:
One liter is more than most people can do.
Shoemaker:
You see people who drink beer, and they can drink beer pretty fast--but cyanide tastes so bad, you don't want to drink it anyway. But in fact, the Mining and Metallurgical Society right now is preparing a paper on cyanide. You might say it's a white paper or position paper, trying to counteract all this adverse publicity about cyanide. People up here in the Gold Country, where I live, claim that old mine tailings have cyanide in them. That is absolutely false. Cyanide long since has decomposed, and children have played in the tailing piles up there for years and years.
They also claim that there is lead and arsenic in the tailings. Well, there are some lead minerals and some arsenic, but they're insoluble minerals. If there was lead or arsenic or cyanide poisoning, probably every kid in Grass Valley would have died a long time ago. But no one has ever gotten sick from playing in those tailings up there and yet the Park Service at the Empire Mines has got all the tailings blocked off with yellow tape.
Swent:
My children had a sand table in the basement filled with sand from tailings, and I sent them down there every afternoon to play for hours, in the sand, in the winter. [laughter]
Shoemaker:
Yes, cyanide is a dirty word. In fact, even chemicals is a dirty word nowadays. And the misinformation these environmental groups put out is just absolutely false. One time, I was at a plant and I saw a man fall into the thickener.
Swent:
Oh, my.
Shoemaker:
That had cyanide solution.
Swent:
You wouldn't recommend that.
Shoemaker:
Well, the thickener was full of not only solution, but ground up ore and that was something horrible to drink. Oh, he just held his breath and he swam over to the side of the thickener and climbed out and went and took a shower, and he was never hurt at all. It just makes you so angry being in the mining business to listen to all of this terrible publicity about cyanide and any type of reagents and any type of chemical. Nowadays, everything--these environmentalists claim everything is poisonous. Anyway, I've been around cyanide for much of my life and certainly I'm still alive.
Swent:
And in very good health.
Shoemaker:
Oh, I think maybe we had better end on that note.
Swent:
All right, Bob. We've covered a lot, and thanks.
