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URANIUM LODE MINING CLAIMS ON FEDERAL

LANDS

MONDAY, OCTOBER 17, 1977

U.S. HOUSE OF REPRESENTATIVES,
SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS,
COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE,

Washington, D.C. The subcommittee met at 10 a.m., pursuant to notice, in room 2123, Rayburn House Office Building, Hon. John E. Moss (chairman) presiding.

Mr. Moss. The committee will be in order.

Today we hold our third day of hearings on uranium claimstaking practices on public lands in Wyoming.

Last Thursday we received testimony from an independent claims staker and a Wyoming county attorney who alleged widespread violation of Federal and State mining law.

Specifically, they charged that Federal lands are being improperly obtained due to the failure to properly stake and drill such claims; and that the exploration of the public domain is being delayed by the subsequent failure to perform the $100 per claim per year assessment work called for by the 1872 Federal Mining Act.

A third witness who claims title to 420,000 acres of public lands repeatedly took the fifth amendment in refusing to answer questions relating to assessment work and the filing of false assessment affidavits-a felony under Wyoming law.

On Friday, we heard from representatives of Fremont Energy Corp. of Denver concerning their optioning 18,000 claims to Washington Public Power Supply System, a Northwest utility.

Their testimony, and that of a former employee, strongly suggests that the claims were improperly obtained in the first instance and were held over the years for the filing of false assessment affidavits.

Today's witnesses represent corporations whose names have been mentioned in previous testimony. With us are Mr. Donald Laub, senior geologist at Phillips Petroleum Co.; Edwin Alden, attorney for the Washington Public Power Supply System; and Omer Humble, chief landman, Exxon Co.

Mr. Laub, would you come forward and be sworn in?

Mr. Laub, do you solemnly swear the testimony you are about to give this subcommittee shall be the truth, the whole truth, and nothing but the truth so help you God?

Mr. LAUB. I do.

(181)

Mr. Moss. Will you identify yourself to the reporter for the hearing record?

TESTIMONY OF DONALD C. LAUB, SENIOR GEOLOGIST, PHIL

LIPS PETROLEUM CO., CASPER, WYO., ACCOMPANIED BY
BRIAN WHITWORTH, COUNSEL
Mr. LAUB. I am Donald C. Laub.
Mr. Moss. Are you accompanied by counsel or by staff?
Mr. WHITWORTH. Yes, Mr. Chairman.
My name is Brian Whitworth, and I am counsel for Mr. Laub.
Mr. Moss. You are accompanied by counsel then.
Do you have a statement, sir?
Mr. LAUB. Yes.
Mr. Moss. You may proceed.
Mr. LAUB. Thank you, Mr. Chairman.
I have a prepared statement.

My name is Donald C. Laub. My appearance before this subcommittee is in response to a subpena dated September 27, 1977.

To acquaint you with my professional background, I attended Utah State University and the University of Utah where I received bachelor of science and masters degrees in geology in 1952 and 1954, respectively. Upon the completion of my formal education, I began employment in the U.S. Geological Survey, serving 2 years as an exploration geologist within the U.S.G.S. Minerals Deposits Branch. After leaving the U.S. Geological Survey, I joined the Phillips Petroleum Co. where I have worked until the present time, with the exception of the period 1969 through August 1974, when I was engaged in private consulting work.

In 1974, I became Northwest area geological supervisor for Phillips Petroleum Co.'s uranium branch.

I appreciate this opportunity to appear before the subcommittee, and I will be happy to answer any questions that you may have.

Mr. Moss. Thank you.
Mr. Frandsen?
Mr. FRANDSEN. Thank you, Mr. Chairman.

Mr. Laub, do you have the basic responsibility for acquiring lands with uranium potential for Phillips in the Northwestern States, including Wyoming?

Mr. LAUB. Yes, sir.

Mr. FRANDSEN. Today, Mr. Laub, we want to draw on your experience and observations out in the field in these four States.

Can you describe generally how Phillips acquires the lands which you believe to have uranium-bearing potential? In other words, do you stake the lands using Phillips employees; do you subcontract the claim-staking activity; or does Phillips purchase interests in uranium claims from others?

Mr. LAUB. Two ways.

We hire professional claims stakers to stake claims. We also acquire mining properties from individuals or other companies.

Mr. FRANDSEN. When Phillips purchases an interest in uranium lode claims from another corporation or individual, what checks are made to insure that the required $100 per claim of assessment work, consisting of labor or improvements, has actually been performed?

Mr. LAUB. A courthouse check of the records to see if annual assessment work has been filed on the property.

Mr. FRANDSEN. Do you also attempt to get from that individual the drilling, mapping, sampling, and assaying data which may pertain to those claims?

Mr. LAUB. Yes, sir; if it's available.

Mr. FRANDSEN. From your observations and experience in the industry, have you found that a great many uranium lode claims, on which assessment affidavits have been filed in the county courthouses, have in fact not had the required assessment work of $100 per claim performed?

Mr. LAUB. I sometimes suspect it, but I have no proof.
Mr. Moss. Let's try that from another direction.

Upon checking to determine whether or not an affidavit has been filed, and finding that an affidavit has been filed, do you go on the assumption that the $100 per year assessment work has been done?

Mr. LAUB. Yes, Mr. Chairman.

Mr. Moss. In other words, it is a clear signal to you—and you place total reliance upon it—that the work has in fact been done?

Mr. LAUB. Yes, sir.

Mr. FRANDSEN. Mr. Laub, is it rather common knowledge in the industry that there are uranium lode mining claims being possessed by individuals or firms where the required assessment work is not being performed, even though the assessment affidavits are being filed in the county courthouses?

Mr. LAUB. Here, again, I believe you could assume that. But neither I or anyone else would have any proof one way or the other-other than checking the courthouse.

Mr. FRANDSEN. When false assessment affidavits are filed in county courthouses, which in effect tie up vast quantities of public lands, does this practice adversely affect you and Phillips from exploring for and developing uranium reserves?

Mr. LAUB. It doesn't

It precludes land from being staked; however, if you want to pay the price, you can always acquire properties from these individuals.

Mr. FRANDSEN. If you want to pay the price.
Mr. LAUB. Yes, sir.

Mr. FRANDSEN. Would you say that millions of acres of land that Phillips is interested in geologically are being tied up by the filing of false assessment affidavits in various county courthouses?

Mr. LAUB. No, sir; I couldn't say that for a fact.

Mr. FRANDSEN. You couldn't say it for an absolute fact, but do you believe that is the case?

Mr. LAUB. I would say that it's a possibility.
Mr. FRANDSEN. Would you say it's a good possibility?
Mr. LAUB. Yes, sir.
Mr. FRANDSEN. In fact, a probability?
Mr. LAUB. I just have no basis one way or the other, sir.

Mr. FRANDSEN. If, in fact, this was being done, would a utility or energy company interested in developing, say, a uranium exploration program be faced with the fact that much of this land with good geologic potential is being held off the market because of the filling of false assessment affidavits?

Mr. LAUB. Here, again, I think it's available if you want to acquire it from these individuals.

Mr. FRANDSEN. So you have to pay the price of the middleman who is holding the land through the filing of false assessment affidavits; is that what your testimony is?

Mr. LAUB. Yes, sir.

Mr. FRANDSEN. There appear to be several possible remedies to that problem. One would be criminal prosecution for filing false assessment affidavits.

Another appears to be that contemplated by the mining law, which is overstaking or relocation of a claim which has not had the required amount of assessment work performed.

When Phillips is interested in land being improperly held, does Phillips overstake and acquire the claims in that manner?

Mr. LAUB. No, sir.

Mr. FRANDSEN. Would you say that little or no overstaking of improperly held uranium claims is being done by major energy companies involved in uranium exploration?

Mr. LAUB. I'm not aware of other companies, but I have not overstaked.

Mr. FRANDSEN. Do you have general knowledge of the industry? Are you aware of major energy companies overstaking either each other or the middlemen who are improperly holding uranium claims?

Mr. LAUB. I'm not aware of any overstaking to speak of.

Mr. FRANDSEN. How much does it cost Phillips to obtain an option for these improperly held claims, in comparison with what it would cost in the first instance to go in and overstake and properly stake the claims?

Mr. LAUB. It depends; it varies considerably.

Mr. FRANDSEN. Would you say it's much cheaper to deal with the middlemen rather than go in and overstake?

Mr. LAUB. Sometimes not; sometimes it may be more expensive.

Mr. FRANDSEN. If Phillips is not using the overstaking option, can you suggest how the improper tying up of Federal domain lands can be stopped?

Mr. LAUB. Yes, sir. I think the BLM Organic Act will alleviate a lot of it.

Mr. FRANDSEN. And how will that take place?

Mr. LAUB. I believe that everyone who has a claim has to notify the BLM of his intent to do the work or to retain the claims.

If they do not notify, I believe the claims are void.

Mr. FRANDSEN. That is the law today-that they have to file assessment affidavits on an annual basis. What makes you think that just by having them file affidavits with the BLM the speculators or phony claims stakers will give up their claims rather than continue to file false documents and assessment affidavits?

Mr. LAUB. I believe the BLM is going to check into it a little more thoroughly than it has been doing.

Mr. FRANDSEN. So it's your belief that the BLM will have a more effective enforcement posture than that in the industry today?

Mr. LAUB. Yes, sir.
Mr. FRANDSEN. What do you base that belief on?

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