13 October 2010

Q: "What if Kennecott had remained open during the war years?"

"The Bingham pit was developed by Daniel Cowan Jackling, the metallurgical engineer who pioneered the mass mining of low-grade ores from open pit mines. Jackling also used his revolutionary methods at mine locations in Nevada, Arizona, and New Mexico, all of which were eventually bought by Kennecott.
"Unlike many new companies, Kennecott made money every year in its early history. The company did not suffer its first operating loss until 1932, at the bottom of the Great Depression. World War I had created high demand for all metals, and when it ended, the copper industry found itself stuck in high gear, overproducing in the face of slowed demand. Kennecott was able to remain profitable mainly because production at the Alaskan site was among the cheapest in the industry, including extremely low labor costs.
"The trend among copper companies in the 1920s was toward vertical integration. Companies such as Anaconda and Phelps Dodge created their own fabricating operations in order to guarantee outlets for the products of their copper mines. Kennecott participated in this trend, but to a far lesser extent than did its main competitors. The company's only significant non-mining acquisitions during this period were the Chase Companies Inc. (which became Chase Brass and Copper Co.) in 1929, and American Electrical Works (changed to Kennecott Wire and Cable Co.) in 1935.
"In 1933, following Kennecott's first unprofitable year, Birch was succeeded as president and chairperson by E. T. Stannard, a director of J. P. Morgan and Company. Around that time, the market was beginning to show the effects of a new flood of copper from Rhodesia. Since Kennecott was set up as a high-production outfit, and also had to keep Chase Brass operating full tilt, cutting back production was not a practical strategy. Stannard instead sought out new markets. Although this policy made no significant gains, Kennecott was bailed out in the late 1930s, as was the copper industry in general, by greatly increased demand for copper in preparation for entry into World War II."
E.T. Stannard was Birch's protege at the original Kennecott site. E.T. Stannard was the company manager during some of the formative years there, also developing the unique ammonia leaching system that was ultimately employed at Kennecott to separate the copper carbonates from the dolomite limestone. Stannard was considered a brilliant engineer, but was not a particularly likable manager. Both Stannard and Jackling appear as Kennecott board members during the 1930s. 
One of the questions I get most often is "what if Kennecott had remained open during the war years?" Did it close too early?  In fact, the mine was largely exhausted of its copper ore reserves by 1938.  It was not in a position to provide copper during WWII.  Similarly, the Beatson and Girdwood mines on Latouche Island,  Prince William Sound, were exhausted in 1930 when they were shut down for good.  

Kennecott leaching plant

(click image for larger one)

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