Another disaster, another commodity price skyrockets

It seems like we hear about another record commodity price on a daily basis. Yesterday alone, we read about world record oil prices and a ten-fold increase in potash prices, which are helping drive up food costs. The interconnectedness of the global economy has never been more evident than in the past months.

Now, it appears the costs of cars, washing machines and anything else made with steel, are going up because January floods in Australia affected the Bowen Basin area that produces 40% of the world’s steel-making coking coal. [above: Ensham Resources Pty. mine site submerged in flood waters in Queensland, Australia, Jan. 22, 2008. Credit: Ensham Resources Pty]

Japanese steel makers are paying $300 per ton of coal from the Bowen Basin, a 300% increase, according to a report in Bloomberg.com. Toyota has announced price increases for some North American model cars as a result of the steel cost.

Coking coal prices may continue to rise into next year because the Australian damage is so widespread.

3-D groundwater visualization for managers

The ASU Decision Theater and the Arizona Water Institute are unveiling Nimue, a software package designed to visualize water resources in 3-D for policy decision making next week at ASU.

According to the announcement, “Nimue (pronounced nee-moo-ay) has been designed to view groundwater data produced by MODFLOW (MODular three-dimensional finite-difference ground-water FLOW model), a software modeling tool written by the USGS to simulate the flow of groundwater. Although there are several software products that are capable of viewing MODFLOW data, they are typically designed for use by hydrologists and engineers. Nimue is an application specifically designed for the visualization of the relevant scientific information needed by water resource managers. Nimue is open source, free, and compatible with the DT such that groundwater data can be viewed immersively in 3D as well as on a user’s desktop. Open source software allows the executable and its source code to be freely distributed, allowing outside developers to update and enhance the existing code to meet their own needs.”

The software is a product of collaboration among the East Valley Water Forum, the Arizona State University Decision Theater and the University of Arizona Tree-Ring Laboratory, funded by an AWI grant.

Senate version of the mining law revision

Mining advocates in Arizona are warning that the proposed changes to the 1872 Mining Law will be bad for the industry, and especially for small and medium sized companies.

The U.S. Senate introduced S2750, "The Abandoned Mine Reclamation Act of 2008" last month as their version of the mining revision effort. The House previously introduced HR2262, "The Hardrock Mining and Reclamation Act of 2007"

S2750 is referred to the Senate Energy and Natural Resources Committee. [above: copper-molybdenum mines in Arizona. Credit: Asarco]

More mining company mergers expected

A report ("The Year of the Hunted and the Hunters: Global transactions in mining and metals") released today by Ernst & Young says that 40% of the world's largest mining companies expect to be able to meet their growth targets only by acquisitions in the next two years. They expect to see three $50 billion+ deals by year end, concluding that the credit crunch is not much of an impact in the mining sector.

Meanwhile, Reuters reports rumors that BHP Billiton was planning to offer 3.8 of its shares for every Rio Tinto share in a takeover bid. BHP and Rio Tinto are joint owners of the huge Resolution Copper mine being developed near Superior, Arizona.

Can Arizona potash be developed as part of "world's hottest mining story"?

The spot price of potash has risen from around $50 per ton to over $500 per ton in the last few years. Some Canadian and U.S. producers are raising prices for Southeast Asia and Brazil to $725-750 on June 1. Spot prices for those markets are $1,000 for July. These dramatic increases are blamed on rising demand for fertilizers, limited production expansion, and constraints at some mines, according to a report at Mineinfo.com which called it the "world's hottest mining story."

Arizona has substantial potash deposits in the Holbrook basin [large green area in east central Arizona, right] which now may look a lot more economically attractive.

AZGS geologist Steve Rauzi published a report (Arizona Geological Survey, Circular 30, January 2002, "Arizona Has Salt!") that concluded,

"The potash in the Holbrook basin underlies about 600 square miles and ranges up to 38 feet thick. The potash in the Holbrook Basin minerals include sylvite, carnallite, and polyhalite. There has been no solution mining or commercial production of potash even though exploration drilling in the 1960s and 1970s indicated a potential of as much as 285 million tons of nearly 20 percent average grade K2O."

That tonnage estimate is from a 1966 ARKLA Exploration internal report that identified it underlying about a 30 square mile (19,000 acres) area. They report that 92% of the company's 54,400 exploration acreage block was apparently untested.

Another geo-web cam for Arizona

Here's another web cam with a geologic view, at the US Forest Service Rocky Mountain Research Station in Flagstaff - http://www.rmrs.nau.edu/

Dutch topo maps are at 1:500 to 1:2000 scale

The Dutch have constructed the Large Scale Standard Map of The Netherlands (GBKN) which they say is the most detailed topographic map available for any country. Their maps are at a scale of 1:500 or 1:1000 in surburban areas and 1:2000 in rural areas. Now, the Netherlands is a small country and pretty flat, but their national resources to complete this project are comparably sized. [right: sample from GBKN]

Compare this to topographic mapping in the U.S. How many of our 1:24,000 topo maps are decades out of date? There is a large industry that has grown up in this country to supply the private sector with the detailed mapping they need. That data is typically proprietary and expensive to get for public purposes.

I found out about the Dutch work because my colleague Martin Peersmann, who I work with on the OneGeology initiative, has just moved to become head of the GBKN.