OCR Text |
Show ! r! T l c: T' ; -- ,' I it' f Significance in The Oil and Mining World ' Salt Lake City. Utah. Friday. Novembei 9. 1956 Vol. 21. Mo. 31 Recent San Juan Basin Largest in Bureau History Recent sale of oil and gas leases on Navajo Indian tribal lands at Window Rock, Ariz., is the largest sale ever held in the history of the Bureau of Indian Affairs, it is disclosed by T. B. Hall, assistant area director for the bureau. Bonuses exceeding $27 million for leases on 52 tracts of land in the San Juan basin were far above those of past competitive lease sales on tribal property. Hall attributed this to three major factors: 1. With the calendar year near-n- g an end and some companies with uninvested funds took the opportunity to invest funds for tax reasons. 2. Comparatively recent discoveries of substantial oil producers in southeastern Utah, where some of the land leased is involved. 3. The Middle East crisis. Hall figures the most important factor is their recent discoveries of oil in the general Four Corners NEW ATLAS MILL This base metals mill near Crested Bntte, Colo., operated by Atlas Uranium Corp., is crushing: ore at the rate of 50 tons per day. Capacity will be stepped up to 100 tons per day by spring. The plant is process-in- g c ore from Atlas mines near Crested Butte, and later will mill ore from Beak Uranium Co. lead-silver-zin- Atlas Mill Going At Full Capacity: CRESTED BUTTE, Colo., Nov. the winter to bring mill capacity Atlas Uranium Corp.s new to 100 tons per day by next spring. The Atlas plant will mill ore base metals mill near Crested Butte now is crushing ore at the from both Atlas and Bleak Urarate of 50 tons per day, General nium Co. mines in this vicinity. Manager D. L. Hericks 'has an- Atas and Bleak have been worknounced. ing together for the last two Test runs were completed in months, with Herrick as general October, Herrick said. Additional manager for both companies. flotation cells are being installed J. C. Burgess, chairman of the to better 'handle the complex ores Atlas board, said in a letter to of the district, he said, and other stockholders this week that Atlas equipment will be added during hopes' to mine its Hawkeye prop- 5 Paso, Pacific Northwest Merger Plans Shape Up El Despite company denials, it is learned on reliable authority that negotiations will be concluded within the next month for acquisition of the assets of the. Pacific Northwest Pipeline Corp. by the El Paso Natural Gas company. El Paso has some very large oil and gas holdings in Utah and surrounding states, while Pacific Northwest, with headquarters in Salt Lake City operates the transmission line from Utah oil and gas fields to the territory. Such an acquisition would be made through issuance of additional shares of common by El Paso, it is said. Such shares could then be traded for the assets of the 283 million dollar western regional transmission company with headquarters at Oregon-Washing-to- n Salt Lake City, The Tribune was informed. Presumably, Pacific would then distribute the El Paso shares to its stockholders. Shareholders would then be asked to approve the the deal which on basis of analysis seems about mutually advantageous to both firms. If the asset acquisition does eventuate, this will be without doubt the biggest natural gas transmision deal in the history of the industry. Certainly, El Paso, now selling nearly two billion cubic feet daily of gas to its Caifornia-Nevad- a markets, would become the largest natural gas transmission firm in the world if from no other stand point than miles of line. Pacific alone has some 2,000 miles of main line and lateral. Phillips Petroleum Co. is reportedly also greatly involved in the Houston talks. That firm has committed a large natural gas lease hold to Pacific in the San Juan Basin and additionally very probably could pick up commitments on substantial resources of distillate, casinghead gasoline, drip gasoline and crude oil corollary to the pending transactions. erty, about six miles from the mill, throughout the winter. The Hawkeye is producing about 50 tons daily, with ore running around $40 per ton. Ore from the Yule mine, an- other Atlas property about 12 miles from the mill, was stockpiled during the summer and averaged $44 per ton. Snow has closed the Yule until spring. West Rails Aid Drought Regions Western railroads have again come to the aid of the drought-stricke- n farmers by a reduction of rates on hay and livestock ship ments moving from points in the; western territory to areas in Texas, Oklahoma, Arizona, Colo rado, Kansas, Nevada, New Mexico . and Utah; and favored also with a shipment of livestock ou of the drought areas to feeding grounds in the western territory. This reduction in rates and as sistance to the farmer is the same service' as was carried on in 1952 and 1954. These carriers are to be complimented on this wonderful service. not been developed as it has now in the Utah area. The Navajos, in addition to the bonus payments, will receive rentals plus 12 per cent of the gross value of the oil produced. We figured that the price paid for ground near the Aneth Pool was very close to what it would be worth on a reasonable profitmaking basis, provided it is productive, said an oilman in Salt Lake City whose firm bid on the acreage. A combination of the Pure Oil Co., Sun Oil Co. and Ohio Oil Co. paid a total of $7,941,120 for rights on 2,560 acres of land in Tract 164 near Aneth Pool in San Juan County. The Texas Co., which found the pool, paid $1,344,211 for only one section 640 acres. Sinclair Oil & Gas paid $3,181,-44- 0 for some 1,920 acres in Tract 157 near the big pool. Phillips, Continental, and Texas Co. were area. others who made million or multiIn previous sales wildcat leases million dollar bids for varying were involved and production had amounts of ground near the field. Diversification Plans Pursued By Company Management of Industries and Mines, Inc., which has large oil and gas interests in the west, reports in a letter to stockholders, the company in continuing its program of diversification. Agreement has just been concluded with Oklahoma oil interests for a 33 13 working interest in 5,280 acres in Valencia County, N. M. Jay J. Harris, consulting geologist, of Albuquerque, N.M., and the Southwest Oil Corp., are now preparing to run final production tests on the No. 1 New Mexico and Arizona Land Co. well, located in the NE NW of Section Valencia County, N. M. n This area is south of the San Juan Basin and the newly discovered Paradox Basin. Pipe will be set on top of the first pay tested at a depth of 40-ac- re Mac-Uta- Clayton Silver Hikes Dividend well-know- 3490 feet. Company officials are advised that the most promising zone with a thickness of approximately 40 feet indicates the strong possibil ity that gas will be found in commercial quantities. El Paso Natural Gas has a pipe line a comparatively short distance from the acreage. In making Out West Uranium Pushes Testing; Names President Richard K. Baker of Salt Lake City, has been succeeded in the presidency of Out West Uranium TIDEWATER SPOTS & Oil company of Denver, by KANE COUNTY TEST John R. Post, formerly of St. Louis. Baker the job to Tidewater Oil, one of the larg- devote his timeresigned to other interests est in the country, will drill a 4,142 foot test in Kane county. Following his appointment, Post The firm advised the Utah Oil announced that Out West had enand Gas Conservation Commission tered into a contract with Vitro that its well No. 1 at Kiabab Corporation of America to drill Gulch would be drilled 1,980 feet Out West claims in the Gas Hills holdfrom the north line and 1,980 feet area, Wyoming. The from the west line of Sec. 34, ing lies between Vitro and Lucky h Construction Co. proTownship 42 South and Range 2 West. ducing properties. Vitro operates completion tests, a process known as oil well drain hole drilling will be employed. Tools are now being trucked to he well location from Oklahoma City and supervisory personnel have been flown in. If commercial production is obtained, immediate development of the more ;han 5000 acre block will be undertaken by the companies holding interests. Clayton Silver Mines upped its dividend rate to 2c a share after in each of the last paying two years. Stockholders of record on Nov. 17 will divide $60,000 in dividends on Dec. 15. The payments will raise the firms total dividends to $960,000, or 32 cents a share. The new 500-folevel of the mine is looking very good. Silver values are about three times what they were on upper levels, the ratio now being three ounces of silver to each one per cent lead. Very little zinc is present. The main north ore body is lengthening and stoping preparations have opened ore over a lc ot strike length of 200 feet without reaching the ore boundaries. Average width of the ore body is about 35 feet. The South ore body also is about 200 feet long on this level but averages 12 feet in width. The mill is running a 100-to- n daily capacity. In the meantime Shunshine is pushing development work at the Ransom uranium mine in which Clayton Silver, Silver Syndicate Four Corners Uranium Corp. of and Sunshine Consolidated jointly Denver is a major stockholder in have a 50 per cent interest along Out West, holding 400,000 of the with the big silver producer. Pre2,600,000 outstanding shares. Four liminary drilling of the King EdCorners also has a contract to ward claim has been completed supply uranium and vanadium and results will be correlated to ores to Vitro. determine future drilling work. a uranium mill at Salt Lake City. Out West also holds 12,000 acres of uranium claims in Fremont county, Wyoming, 3,320 acres of oil and gas leases near the Anneth field in San Juan county, Utah, and 29 uranium claims in the Little Gyp Valley in San Miguel county, Colorado. |