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Show WmMt3 Aadc22 V -- 4'r ai Rocky Mountain 0il& (vnrainiG journal 25 Cents Per Copy November 16( 1970 VOLUME 2 NUMBER 36 Treasury goes out of silver business; ends weekly auctions WASHINGTON The nations largest buyer and seller of silver, the U.S. Government, has gone out of the silver market. . General Services Administrations sale of about l.S million ounces of the precious metal last Tuesday ended 194-ye- a role. ar The auction left the government with 80 million ounces of silver, just about what it had in 1933 when the government first began to actively accumulate massive amounts of the metal for coinage purposes. Most of that, however, is unrefined or mixed with gold. The government has little need for silver, as the only silver it puts in coins goes into the five million Kennedy half dollars sold to collectors each year as proof and mint sets. Each of these coins contain only 0.1 5 ounces of silver. The government has stockpiled 16S million ounces of 0.999 fine silver, but this is reserved for defense needs and isnt available for Treasury use. The removal of the Treasury from the market adds new uncertainty to trading in the commodity in New York, Chicago, Los Angeles and London. The government has been a major factor in the market for more than 35 years. From 1933 to 1963, the Treasury was a big buyer, accumulating more than 3.5 billion ounces of the metal. Of the hoard, more than two billion ounces were put into coins. With the removal of silver from coinage, however, the government became an active seller, disposing of more than 650 million ounces, about half through the weekly GSA auctions. Without the government offerings, silver users will have to contend with uncertain supplies. World demand for silver has been a year to 365 rising about 2 million ounces. But new production accounts for only 250 million ounces of silver a year. An additional 60 to 80 million ounces is recovered from scrap materials, principally photographic films and papers. Since early October, silver, prices have been trending upward. Handy & Harmon quoted the metal last week for. immediate delivery at $1.80 an ounce, up from $1.69 an ounce on October world-wid- e 1. Homestake sees higher gold price digs deeper it foot SAN FRANCISCO Saying anticipates higher prices for gold, Homestake Mining Co. has announced it is pushing development of deep levels of its mine at Lead, S.D. President John K. Gustafson said since the project was started in August, 1969, there have been encouraging discoveries of better than average ore between the OIL SEPARATION, STORAGE and water flood system are pictured at the site of Western Oil Development Corp.s (WODCO) Americana leases in Vernon County, Missouri. WODCO recently purchased the leases, 45 wells and production equipment for stock and cash. 4,500 and 6,800 levels in what is known as Nineteen Ledge. As a result, he said, the directors have authorized a major program to mine these new bodies at an increased rate. Estimated to cost about $8 million over five years, the work includes sinking a shaft to 7,400 feet and exploring below the present lowest level of 6,800 feet. WODCO announces acquisition 45 Missouri oil wells, facilities Western Oil Development Corp. (WODCO), Salt Lake City, has announced the acquisition of 45 oil wells and a substantial portion of production facilities at Vernon County, Missouri, for cash and stock. In a letter to shareholders, the company announced the purchase of the Americana leases, oil wells and production equipment from United American Industries, Inc., of Tucson, Airzona, for 80,000 shares of WODCO stock and cash. A petroleum geologist has estimated that net production from the North and South tracts of the field would amount to approximately $1,849,500, using artificial pressurization for recovery. The geologist, David L. Dooley of Oklahoma City, Okla., PANORAMIC VIEW OF NEW PRODUCTS property in Nevada for which New Products and Kings River Minerals Corp. have sighed a joint venture agreement. Kings River has agreed to develop the properties for New Products. The silver used a market price of $2.84 per barrel for estimating the return, WODCO president Dennis Madsen said. The leases, which cover some 1 86 acres in Vernon County, Missouri, lie in the easterly portion of what is known as the Bourbon Arch an oil bearing formation extending from Kansas into western Missouri. An article in the Nevada Herald reported that it has been estimated that there is possibly as much as 30 billion barrels of crude oil in the Bourbon Arch deposit. The shallow depths of the wells makes artificial pressurization of waterflooding pressuring the Madsen said, of the opinion of as the means of Americana leases, but management is that other methods will result in a higher recovery. He told shareholders that managements present plans are to utilize inert gas injection methods which are being developed in other parts of the country and have been utilized on a limited basis with some success on other projects in the Vernon County area. He said management believes that this method will prove beneficial on these properties and anticipates that this method may the formation necessary to increase the rate of recovery and recover a high percentage of the provide a cleaner sweep of the oil, Mr. Madsen said. Continued on Page 2 Prior lessees contemplated properties were recently hailed as a find of major significant. Kings River has just , completed a public stock offering for $300,000. (Story on Page 4) |
