15 October 2010

Bob Haldeman Interview (37)

Anaconda Company; Chuquicamata Mine. Charles Brinckerhoff

Haldeman: Now they called on number two, Anaconda. Well, Anaconda just
couldn't pay dividends if they didn't have 100 percent of the
cash flow from Chuquicamata and El Salvador. 1

Swent: Who was here with Anaconda at that time?

Haldeman: Charles Brinckerhoff , who had been here for years as the head of
Anaconda, had just moved up to be president, not chairman of the
board of Anaconda in New York. Another fellow, Richard Sims, a
controller, came down. He had been put in to operate it until
they got somebody else the Chuqui mines and so on. Actually,
Brinckerhoff didn't really relinquish too much control over the
operations of the property.

The Chileans started to talk to them. Anaconda couldn't
afford to give 25 or any percent of those two mines, but they
had this ore body which was called Exotica, about ten kilometers
away from Chuqui. Chuqui was leached over the years, and part
of the solutions trickled, ran under the gravel blankets,
deposited out in the basin, and formed this secondary enrichment
body, Exotica. They had grades of 2, 3, or 4 percent copper,
but they were all exotic minerals all acid solubles, no
sulfides, nothing primary. They had stumbled across the darned
thing when they were digging a shaft in a drift to drain the
tailings deposits, and they found this ore.

They started to work on the metallurgy of the thing, and,
along came Mr. Frei. So they said, "Well, we have a new ore
body here; we'll open it up. It's high grade, and you'll have
25 percent in that. And we will pledge to increase the
production at Chuquicamata by X percent,

Anaconda Copper's Chuquicamata mine

El Salvador by
Y percent, and we will help build new port facilities at
Tocopilla. We'll open an exploration program down in the
southern part of Chile to satisfy a couple of senators down
there." All of these things were window dressing and icing on
the cake, and Chuqui and El Salvador were still 100 percent in
Anaconda's hands, and the tax rates on the companies who went
along were reduced to be 50 percent maximum tax.

After a lot of fuss, the government accepted that. So we
were called. Of course, Frei had pretty well been convinced by
this time that he didn't want to force this on us and become an
enemy of the United States for investments, and in the world of
copper, too. He probably figured he would try and get the best
he could, and the next round, when his party was elected six
years later, he could take another whack at the companies.

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