Assessing Montanas Mineral Development Potential in a Global Context with a view of Recreational Col

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Assessing Montanas Mineral Development Potential
in a Global Context with a view of Recreational
Colonization

• 13th Annual Mine Design, Operations Closure
  Conference April 17-21, 2005
• Leigh W Freeman
• Downing Teal Inc
• Billings West HS 67, Geol Eng Montana Tech 71

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Montana An Uncommon Land K. Ross Toole (1920
1981)

• Nature, not the evil designs of men, decreed
  that Montana be a place of a colonial economy.
• Montana was a plundered colony whose rich
  natural resources had been extracted by outside
  interests.
• as capital flowed westward, control and the
  bulk of wealth flowed eastward.

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Montana An Uncommon Land K. Ross Toole (1920
1981)

• Consider this legacy in the context of
• Sustainable Development

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This Presentation

• A view from outside Montana and its peers
• Nature Montanas mineral endowment
• Regulations, policies and their administration
• Potential
• Balancing risks and rewards of resource
  development in the context of Sustainable
  Development Who should choose the path forward?

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Mineral Development in Montana

• From a legacy of economic colonization to one of
  recreational colonization
• Do we stand at a cultural watershed? Overprinting
  a natural resource based culture (agriculture /
  ranching, forestry and minerals) with a tourist /
  service culture.
• Culture aside... Can Montanans earn a decent
  living providing services for out of state
  tourists?

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This Conference

• Montanas mineral endowment
• Regulations and policies
• Administration of regulations and policies
• Willingness of companies to invest
• Functionality of regulations and policies

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This Conference

• What should the citizens of Montana believe about
  modern mineral development?
• Operations in the context of Sustainable
  Development.
• Is the mining industry really committed to
  Sustainable Development?
• Can the community of regulators meet the needs
  and expectations of society at large?

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Frasier Institute

• A view from outside Montana and its peers
• www.FraserInstitute.ca

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Fraser Institute

• An independent Canadian economic and social
  research and education organization.
• Annual global mineral survey to assess how
  mineral endowments and public policy factors such
  as taxation and regulation affect exploration
  investment.

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Fraser Institute 2004/05 Mining Survey

• Sent to 1,121 exploration, development, and
  mining consulting companies around the world.
• Response 23 (259) of the companies
• Represents 2005 exploration budget of US798
  million

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Frasier Institute 2004/05 Survey 64 political
jurisdictions

• The Canadian Provinces (except Prince Edward
  Island)
• The Australian States
• Fourteen US States
• Oceania Indonesia, New Zealand, Papua New
  Guinea, Philippines
• Africa - Botswana, Burkina Faso, DRC (Congo),
  Ghana, Mali, South Africa, Tanzania, Zambia,
  Zimbabwe
• Latin America Argentina, Bolivia, Brazil,
  Chile, Ecuador, Mexico, Peru, Venezuela
• Eurasia China, Finland, India, Ireland,
  Kazakhstan, Mongolia, Russia, Spain, Sweden,
  Turkey

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Frasier InstituteMontanas peer

• Fourteen US States Alaska, Arizona, California,
  Colorado, Idaho, Minnesota, Montana, Nevada, New
  Mexico, South Dakota, Utah, Washington,
  Wisconsin, Wyoming

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Mining Policies

• Report card to governments on how attractive
  their policies are from the point of view of
  exploration manager.

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Mining Policies
Peer group 14 States Total worldwide 64
jurisdictions
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Current Mineral Potential

• Does the jurisdictions mineral potential under
  the current policy environment encourage or
  discourage exploration?

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Current Mineral Potential
Peer group 14 States Total worldwide 64
jurisdictions
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Current Mineral PotentialRank Zero on
Encourages Investment
Peer group 14 States Total worldwide 64
jurisdictions
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Best Practices Mineral Potential

• The jurisdictions mineral potential, assuming
  their policies are based on best practices.

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Best Practices Mineral Potential
Peer group 14 States Total worldwide 64
jurisdictions
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Potential to Improve

• Subtracts the jurisdictions score for mineral
  potential under best practices from mineral
  potential under current practice.

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Potential to Improve
Peer group 14 States Total worldwide 64
jurisdictions
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Potential to Improve
Global rank. Montana is number one in the world,
followed by California, Alaska, Colorado,
British Columbia, the Philippines and Indonesia.
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Need to Improve ?
Global rank. Montana is number one in the world,
followed by California, Alaska, Colorado,
British Columbia, the Philippines and Indonesia.
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Per Capita IncomeTen highest states
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Per Capita IncomeTen lowest states
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Natural Resource Operations
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Natural Resource OperationsPer Capita Income -
Top Ten Counties
7
9
5
10
3
4
2
1
6
8
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Weekly EarningsMontana Dept of Labor 12/04
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What can be done?

• Balancing risks and rewards of resource
  development in the context of Sustainable
  Development
• Are mining companies committed?
• Are our regulations and policies adequate?
• Are our regulators up to the task of
  administering them?
• Who should choose the path forward?

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Montana A plundered province

• Economic colonization overprinting of cultures.
  
• Native American
• Plundered province, sequentially
• Furs
• Cattle
• Silver
• Lumber
• Copper
• Recreation?
• What have we learned?

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What have we learned.?

• One culture has no right to overrun another.
• Those of the affected culture are critical
  stakeholders in any change process that puts
  their culture at risk.

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Montana An Uncommon Land K. Ross Toole (1920
1981)

• Nature, not the evil designs of men, decreed
  that Montana be a place of a colonial economy.
• Montana was a plundered colony whose rich
  natural resources had been extracted by outside
  interests.
• as capital flowed westward, control and the
  bulk of wealth flowed eastward.

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Montana An Uncommon Land K. Ross Toole (1920
1981)

• Nature, not the evil designs of men, decreed
  that Montana be a place of a recreational
  economy.
• Montana was a plundered colony whose rich
  natural resources had been acquired by outside
  interests.
• as capital flowed to Montana, control flowed
  eastward and to California.

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Election Results 2004Political parties as a
proxy for culture
1
1
35
Election Results 2004With per capita income
ranked by state
9
44
7
6
45
3
5
1
1
2
1
8
4
47
48
10
43
49
46
42
50
41
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Election Results By PopulationPolitical parties
as a proxy for cultures
44
37
Election Results By Population with per capita
income ranked by state
9
44
7
3
44
5
45
6
1
8
2
47
10
4
48
46
43
49
42
41
50
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Is the next chapter in Montanas storied
legacyRecreational colonization?

• overprinting a natural resource based culture
  (agriculture / ranching, forestry and minerals)
  with a tourist / service culture.
• What should the citizens of Montana know and
  believe?

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For Discussion.

• Can mineral resources be developed in such a way
  that we improve rather than degrade quality of
  life?
• Sustainable Development