March 24, 1944


The house resumed from Thursday, March 23, consideration in committee of a resolution to grant to His Majesty certain sums of money for the carrying out of measures consequent upon the existence of a state of war- Mr. Ilsely-Mr. Bradette in the chair.


DEPARTMENT OF MUNITIONS AND SUPPLY

NAT

William Kemble Esling

National Government

Mr. ESLING:

At the sitting of yesterday the member for York West referred to tungsten. I would like to ask the minister a few questions for the purpose of general information on the subject. I do not expect the replies to-day but I hope' he will note the questions and bring down the answers at his convenience. Tungsten has been a mineral of very great importance, particularly in the early part of 1942, so much so that there was general publicity in all mining papers as well as in all newspapers advising prospectors and miners to be on the lookout for scheelite ore from which tungsten is taken.

I speak on this matter for the reason that the Emerald mine in my district was looked upon as one of the most promising tungsten properties in the dominion. The owner was a resident of the United States. Negotiations for the purchase of this mine were entered into, with the result that the owner asked the government $1,750,000. I suppose that was what one might call wet weight, because the government expropriated the property and took it over at dry weight of $424,000 payable in United States funds. That is quite a difference.

The metals reserve corporation apparently proceeded to develop the property, although the property is in the name of the government. That property produced 132 tons of high-grade tungsten and 267 tons of low-grade tungsten concentrates.

I wanted to ask the minister first of all: Does the property remain in the name of the Canadian government? Has it been fully paid for, and in view of the fact that the mine has closed, that operations have ceased, that there is no more demand for tungsten, will the minister first note the question as to why this lack of need for tungsten has come about in such a short time? Was there not sufficient research work to determine whether there would be an oversupply in the United States, or was there not sufficient research work to tell whether there would be any specific amount required in Canada? I ask this because the advertisements in the public press encouraged

everybody to go after scheelite ore. I asked what expenditures had been made on the Emerald mine, and1 the reply was $829,000 for development. I took it for granted that $424,000 would be added to that for the expropriation of the mine. I wish to ask the minister if the $829,000 includes the cost of erecting the mill, because the development of the mine could not be proceeded with unless there was a mill. It is a very up-to-date mill.

We now have $829,000 and $424,000 of United States funds in the property while 267 tons of low grade concentrates, which yielded $70,000, have been shipped out. There are 132 tons of high grade concentrates left. What is the assay of the high grade concentrates? What will be the approximate value of them? What is the government going to do with these high grade concentrates, and what is the government going to do with the high grade concentrates from the various mines across the country which have been producing tungsten? They all went to considerable expense to get production under way.

In September last all operations at this Emerald mine ceased and the mill closed in October. Can the government not arrange to use that mill as a customs mill for prospectors of lead and zinc ores in the West Kootenay district? It may be necessary to have some alterations made, but as development cost $829,000 and the property $424,000, plus the cost of the mill, which is unknown, it represents a very large investment.

I should like to turn to the matter of publicity and the encouraging of prospectors to make a thorough search for the then much-needed tungsten, which to-day is' not needed at all. Is that situation brought about because the production in the United States is so greatj or the price of mining so much less. I wish to cite to the minister the case of a local prospector. A letter in reference to that case went to the Department of Mines four or five days ago, to which there has been no reply. I stress the Department of Mines because all the newspaper publicity urged prospectors to be on the lookout for scheelite and to send their samples to the Department of Mines. They were told if they did that they would get full information not only as to procedure but as to the names of the firms in the United States to which the tungsten concentrates could be shipped. I cite this case purely as a matter of justice in view of the publicity given.

This man was employed during the day. He had a property on which he thought there were scheelite indications. At his own expense he bought a mineral lamp and proceeded to mine his scheelite ore with the result

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that he took out four tons of concentrates containing tungsten. He sent samples to the Department of Mines at Victoria. Apparently the provincial government and the federal government were acting in unison; however, most of his correspondence had been with the Department of Mines at Ottawa. As I say, he sent his samples to Victoria. He had them assayed and sent to the Minister of Mines. Apparently he did not get very much general information from Ottawa, but he directed another letter to the Minister of Mines in January, after information was received that there was no use for tungsten in Canada; that the Emerald mine had closed along with the mill. He asked the Minister of Mines where he could ship his concentrates. He had been told in those printed advertisements and publications from the Department of Mines-I suppose it applied to the federal and provincial departments-that when a man had tungsten concentrates which reached a specific assay the department would advise him to what firm in the United States to ship them, and he would be paid fifty per cent cash and the balance upon receipt of the concentrates and an assay by the United States firm to which they had been shipped. However, the Department of Mines told him there was no longer any use for concentrates. After the first of January he wrote to the Minister of Mines and asked whether it was worth while to proceed with the purchase of additional mining equipment in order that he might locate the main body of ore on his property. The Minister of Mines replied that a tungsten property is always of great value but at the present time there is no place to ship the concentrates.

Visualize a man putting in an eight hour shift and responding to the plea of the government to hunt for scheelite to produce tungsten concentrates. He puts in an eight hour shift at his everyday work. He was employed in the smelter. He wrote to the management of the mill of the Emerald mine, which is not over thirty or forty miles away, and the mill manager replied that he was unable to mill his Concentrates unless he could secure the permission of the Minister of Mines. He must have meant the federal Minister of Mines, because the property belongs to the federal government. Before he could get a reply the mill had closed. He then proceeded to break up the four tons of ore himself. It is a very hard job to break up four tons of ore. He put in his time in the evenings and on Sundays, and, as I said, he got out the high grade concentrates and the low grade concentrates. He did not ask the government to accept the low grade concentrates, but he wanted to get some reimbursement for his high grade concentrates. Unfortunately there

is no place to which he can ship. My contention, my plea and my suggestion is that it is only a matter of justice for the government to take that man's two tons of concentrates and pay him for them. They undertook to pay him fifty per cent cash as soon as he got an assay, the balance to be paid upon analysis by the firm to whom it was shipped. It is only a matter of justice that that prospector, who has gone the whole way, done everything that the government asked him to do, should be repaid for his effort or a market found for his concentrates. They have a million and a half in this Emerald property, and the government would not know what to do with it to-day any more than they would know how to fly. Why could they not compensate that prospector for two tons of concentrates?

I want to come now to the Kootenay-Florence mine, which is on Kootenay lake, and belongs to a Canadian firm. The metals reserve corporation, through the metals control board, entered into an agreement with that company. I want to ask the minister the terms under which that property is being operated. I know the owners are receiving a royalty, but I want to know also the price they receive per ton for the lead and zinc concentrates being shipped to the United States. My main purpose, however, is to ask the minister if he will not make use of that mill. It is a lead and zinc mill. The Emerald mill is a tungsten mill which could be altered to accommodate lead and zinc concentrates, but the Florence mill is being operated already. I ask the minister if arrangements cannot be made for the use of the Florence mill by local mines. There must be a customs mill in the West Kootenay district; otherwise you will discourage, as you have been discouraging, the production and shipment of lead and zinc, which is urgently required.

What did the Consolidated Mining and Smelting company do? They entered into an agreement with the British government to sell all their lead and zinc during the period of the war, and they are receiving 3-6 cents per pound for zinc. To-day the quotation in St. Louis for lead is 6-35 cents and for zinc 8-25 cents. I mention these quotations particularly because I want to appeal to hon. members to my left, who never seem to have a kindly word for the Consolidated Mining and Smelting company, which they look upon as a corporation which has no regard for industrial relations. I can assure them that the industrial relations of this company are not equalled by those of any other concern in the Dominion of Canada. Further I want to say to hon. members to my left that by

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selling to the British government for about 3-6 cents per pound instead of at the prices quoted in the United States, which prices are received by any producers who ship their concentrates to the United States, this company has saved the British government about $22,000,000 annually ever since the outbreak of the war. I would ask my hon. friends to have a generous thought for one company which does not seem to operate purely for the exploitation of the country.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

I shall be very glad at the next sitting to answer the questions which have been asked by the hon. member for Kootenay West.

While I am on my feet I should like to refer, to two matters which were discussed last evening. The first was in connection with the ownership of Clark Ruse Aircraft Limited. The reason I mention this is that certain statements made in the house last evening were quoted in the press to-day. The directors of the company are: J. Clark Ruse, president; Ewart Angus, vice-president; Mel Angus, secretary-; Harold Jeffries; Hon. J. Earl Lawson.

The directors, with the single exception of the estate of Alfred R. Caldwell, are all the shareholders and own the total share capital. The estate of Alfred R. Caldwell is represented by Hon. J. Earl Lawson, who is the solicitor for the company; and it was through Mr. Lawson that the capital invested in the company was raised. I suggest that the hon. member for York-Sunbury might be a little careful in talking unjustly about the officers of my department.

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NAT

Richard Burpee Hanson

National Government

Mr. HANSON (York-Sunbury):

I did not make any attack; what I asked-

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

You did not ask; you stated.

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NAT

Richard Burpee Hanson

National Government

Mr. HANSON (York-Sunbury):

Just a moment; the minister has referred to me and I am rising to a question of privilege. I asked whether the capital investment in the plant was to be a loss to the country, or how it was to be treated.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

You made a statement.

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NAT

Richard Burpee Hanson

National Government

Mr. HANSON (York-Sunbury):

Perhaps the minister misunderstood the purport of my question.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

There was no question. You made a statement about a member of my department which you asked to have expunged from Hansard, and I agreed to have it expunged.

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NAT

Richard Burpee Hanson

National Government

Mr. HANSON (York-Sunbury):

I never asked to have it expunged. Someone else asked to have it expunged, and I agreed to it, if you want the bald truth.

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LIB
NAT

Richard Burpee Hanson

National Government

Mr. HANSON (York-Sunbury):

Not myself, either. I did not ask for it, but I agreed to it. The minister is on the wrong track. I was asking about the capital expenditure in the plant at Dartmouth, and now that operations there are -being reduced I wanted to know if that was to be a capital loss to the country, or what use it was to be put to. I said nothing about the ownership of the company. The minister has sought to bring that in, and I welcome the information but I did not ask for it.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

You certainly made a statement about it, and I was answering that statement which, had it been true, would have caused a very serious situation in the department and in the country.

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NAT

Richard Burpee Hanson

National Government

Mr. HANSON (York-Sunbury):

I will look it up in Hansard.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

You will not find it in

Hansard, but you can find it in the typewritten sheets from which it was expunged.

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NAT

Richard Burpee Hanson

National Government

Mr. HANSON (York-Sunbury):

I understood you agreed to have that done, and I agreed to it.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

Nevertheless it appeared in the press, and I thought it deserved an answer.

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NAT

Richard Burpee Hanson

National Government

Mr. HANSON (York-Sunbury):

I did not put it in the press, and I am not responsible for what was there.

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LIB

Clarence Decatur Howe (Minister of Munitions and Supply)

Liberal

Mr. HOWE:

You are responsible for what you say in the house, I think.

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March 24, 1944