Appendix — United States v. General Dynamics Corp.

Supreme Court brief1974

Ask Donna

What actually matters in this document.

Text

APPENDIX ater

EXHIBITS (Pages 481-920) wicwars nopax, sn

Seneca

Supreme Court of the United States

OcTOBER TERM, 1978

No. 72-402

UNITED STATES OF AMERICA, __

: Appellant

Vv.

GENERAL DYNAMICS CORPORATION, THE UNITED

ELecTRiC CoaL COMPANIES, and FREEMAN

CoaL MINING CoRPORATION

ON APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

Supreme Court of the United States “

OcTOBER TERM, 1973

No. 72-402

UNITED STATES OF AMERICA,

Appellant

ON APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

INDEX

dicinmssinin Exhibits:

‘GX 1— Annual Report of General Dynamics Corporation

Gx 2— Aneel Repent @f Gaiuial pain Gay see

Gx 9— Amamel Bapect of Giiasal Spaecaies Gapanien

Gx +— Amen Rigi kt Gniacal Siccaiis Sica

Gx 6 Annu Report of General Dymamica Corporation

Gx € Kunal Rega ot Gamatal injeaaia Gaga

i 1965

Working Capital and Net Assets or Stockholders

Equity 1940 to 1967”

INDEX

Government Exhibits :—Continued

GX 25— Chart entitled “The United Electric Coal Com-

panies Net Sales, Earnings Before Income Taxes,

Net Earnings, and Net Earnings as a Percentage

of Net Sales 1940 to 1968" _.. ==

26— Standard & Poor’s Industry Surveys— “Coal,”

April 28, 1966, Section 2, Basic Analysis _..._.__.

27— Letter dated March 26, 1968 from Reuben L.

Hedlund to John T. Cusack re Dividends De-

clared and Paid by UEC during the period Janu-

ary 1, 1950 to December 31, 1967 =

29— Standard Industrial Classification Manual 1967 _

31— Chart entitled “The Consumption of Fuel by

Steam-Electric Plants in the Eastern Interior

Province Sales Area for the Years 1960-1967”_.

32— Chart entitled “Consumption of Fuel (Shown in

Millions of BTU’s) by Portland Cement Plants

in Illinois in 1967” and Chart entitled “Consump-

tion of Fuel by Portland Cement Plants in

Eastern Interior Coal Province Sales Area in

1967”

34— Financial Statements: The United Electrical

Coal Companies; Year Ended December 831,

1968

35— City, Water, Light & Power (Springfield) letter to

Department of Justice dated March 21, 1968 __

86— Illinois Power Company letter to Department of

Justice dated March 21, 1968 ____ es

87— Dairyland Power Cooperative letter to Department

of Justice dated April 28, 1968 _

39— Corn Products Company letter to Department of

Justice dated May 24, 1968 _..... =

41— Union Carbide Corporation letter to Department

of Justice dated August 2, 1968

43— Dundee Smith Company letter to Department of

Justice dated August 22, 1968

S1— Chart entitled “Coal Shipments to Illinois, Desti-

nations by District of Origin, 1965 to 1967” ___.

wa. Guact extbticd “Veer Wades of Coal ta tha Bosions

Interior Coal Province Sales Area by Coal Pro-

ducers Located in Illinois, Indiana and W:

Kentucky” Ras Saves

54— Freeman Coal Mining Corporation; Shipments

of Coal in Tons from the Crown Mine to Customer

Page

INDEX

Government Exhibits :—Continued

56— Freeman Coal Mining Corporation; Shipments of

Coal in Tons from the Orient No. 4 Mine to Cus-

tomer Destinations, 1967

57— Freeman Coal Mining Corporation; Shipments of

Coal in Tons from the Orient No. 5 Mine to Cus-

tomer Destinations, 1967 —..._______..

58— The United Electric Coal Companies; Shipments

of Coal in Tons from the Banner Mine to Cus-

tomer Destinations, 1967

59— The United Electric Coal Companies; Shipments

of Coal in Tons from the Cuba-Buckhart Mines to

Customer Destinations, 1967

60— The United Electric Coal Companies; Shipments

of Coal in Tons from the Fidelity Mine to Cus-

tomer Destinations, 1967 ______-___-_____-_-__

61— Chart entitled “Total Coal Consumption in Tons

in 1967 by Steam Electric Plants in the Eastern

Interior Coal Province Sales Area and the Total

Sales of Coal in Tons in 1967 from Mines located

in the Eastern Interior Coal Province to Steam

Electric Plants in the Eastern Interior Coal Prov-

ince Sales Area”

62— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries for

the 1957 Calendar Year” __

68— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries

for the 1958 Caleadar Year”

64— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries

for the 1959 Calendar Year” >=

65— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries

for the 1960 Calendar Year”

66— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries for

the 1961 Calendar Year” _.

67— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries for

the 1962 Calendar Year”... -- —___. ioe

68— Chart entitled “Production of Coal in ‘Tilinois by

the Leading Companies and Their Subsidiaries

for the 1968 Calendar Year”

69— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries

for the 1964 Calendar Year” _..__________» ___-__

70— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries

for the 1965 Calendar Year”

Page

INDEX

Government Exhibits :—Continued

71— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries for

the 1966 Calendar Year”

72— Chart entitled “Production of Coal in Illinois by

the Leading Companies and Their Subsidiaries

for the 1967 Calendar Year”

73— Chart entitled “Production of Coal in Illinois by

the Top Two, the Top Four, and the Top Ten

Producers, 1957-1967, and their Percentage of

Total Production for These Years”

74— Chart entitled “Sales of Coal in Illinois by the

Leading Companies and Their Subsidiaries in 1967

(From Mines Located in Eastern Interior Coal

Province)”

75— Chart entitled “Production of Coal in Illinois,

Indiana, and Western Kentucky by the Leading

Companies and Their Subsidiaries in Calendar

' Year 1957”

T7— Chart entitled “Production of Coal in Illinois,

Indiana, and Western Kentucky by the Leading

Companies and Their Subsidiaries in Calendar

Year 1959”

85— Chart entitled “Production of Coal in Illinois,

Indiana, and Western Kentucky by the Leading

Companies and Their Subsidiaries in Calendar

Year 1967”

86— Chart entitled “Production of Coal in Illinois,

Indiana, and Western Kentucky, 1957-1967” __

87— Chart entitled “Acquisitions in the Eastern In-

terior Coal Province since 1954”

88— Chart entitled “Common Known Customers of

The United Electric Coal Companies and Free-

man Coal Mining Corporation Showing Destina-

tion Points 1965”

89— Chart entitled “Common Known Customers of The

United Electric Coal Companies and Freeman

Coal Mining Corporation Showing Destination

Points 1966”

90— Chart entitled “Common Known Customers of The

- United Electric Coal Companies and Freeman

Coal Mining Corporation Showing Destination

Points 1967” _.

91— Chart entitled “Per Cent of Sales of Each Com-

pany to Identical Customer Facilities by The

United Electric Coal Companies and Freeman Coal

Mining Corporation for the Year, 1965-1967”__.

98— Central Illinois Public Service Company letter

to Department of Justice dated October 28, 1966_

101

107

111

114

117

118

“. INDEX

Government Exhibits :—Continued

GX 94— Illinois Power Company letter to Department of

Justice dated October 17, 1966

CR, hs Ct pe ad Ge tek

to Department of Justice dated October 20, 1966_

Gx 135— March 26, 1970 Petition of Commonwealth Edison

to form subsidiary

GX 200— United Electric Coal Companies, Board of Di-

rectors Minutes—1959

GX 201— United Coal Companies, Board of Di-

rectors Minu 1960

GX 210— Testimony of Jack Simon before Illinois Com-

Commission

merce

GX 219— Keystone Coal Buyers Manual 1967

GX 232— Article entitled “The Energy Outlook”, by Gerber

and Netschert, entered in the IEEE Spectrum,

June 1969

GX 233— Speech by J. Cordell Moore entitled “The Future

' Role of Fossil Fuels in Electric Power Genera-

tion,” at the American Power Conference luncheon

in 1968

GX 239— Article entitled “New Horizons for Coal—the

Comeback Industry”, by Robert E. Lee Hall,

printed in The Commercial and Financial Chron-

icle, dated March 7, 1968

GX 247— Article entitled “Natural Gas Fiasco”, printed in

Barron’s, October 13, 1969

GX 253— Article entitled “Nuclear Power ” 1968-

1969 Report by Philip Sporn to Joint’ Con-

gressional Committee on Atomic’ Energy, re-

printed in CCH {| 3043 ‘

Defense Exhibits:

DX 1— October 9, 1957 memorandum from Frank Kolbe

to R. J. Hepburn re punch mining

DX 2— October 18, 1957 letter from J. M. Morris to

Frank Kolbe re Northern States Power Company,

Displacing gas with coal

DX 3— June 19, 1958 letter from A. J. Christiansen to

A. H. Truax with three page attachment...

DX 4~— July 1, 1958 letter from J. M. Morris to Frank

Nugent

DX 5— July 11, 1958 letter from R. J. Hepburn to Frank

Kolbe with two page attachment

Dx 6— August 4, 1958 letter from “President” to Mr.

’ Justin Potter —

DX 7— November 21, 1958 Wall Street Journal article

“General Dynamics Seeks To Acquire Chicago

Building Firm”

144

167

194

210

PRFRRARAAR RHRA RESERBHRE B

Tan aii

S eeraear) DMA as eee Page ea lee

weet td Gn Let Hie tei ue

: oe ian [| rer

pee ee la | be

|i ot : eee ntsyee pela 2% Pc ap tbe

Westie Ts hie Sanibel bestbeee- Har

fpsaaa ete eee eee

“>

INDEX

Defense Exhibits :—Continued

DX 32— September 12, 1966 letter from J. Morris to

Frank Nugent

DX 383— October 18, 1966 memorandum between R. H. In-

man and T. H. Latimer

DX 34— July 31, 1967 letter from Jack A. Simon to

Frank Nugent

DX 35— September 31, 1968 four-page coal contract be-

tween UEC and Central Illinois Light Co...

DX / 86— September 5, 1969 letter from John Welsh, Cater-

pillar Tractor Co., to Reuben Hedlund re coal

DX 37— September 12, 1969 letter from John T. Cusack

DX S88— 1965 Annual Report Zeigler: Coke Company

DX 39— 1966 Annual Report Zeigler: Coke Company

DX 40— 1967 Annual Report Zeigler: Coke Company ____

DX 41— 1968 Annual Report Zeigler: Coke Company

DX 42— Report to shareholders, three months ended March

Dx 43— Report to shareholders, six months ended June

DX 44— Report to shareholders, nine months ended Sep-

30, Company

DX 45— Statement by Assistant Attorney General Richard

Imports, August 8, 1969

DX 46— The Answers of Plaintiff to Interrogatories of De-

fendants 1(a)-1(g), 1(j), 6-8, 18-15, 17, 18, 20,

21, 23, 26, 27, 30, 37, 44-46, 50, 51 and 54.

DX 47— May 29, 1969 letter from John T. Cusack to

Dx 48— December 15, 1954 letter by George P. Pon

ene. Nee, Danan Gas Gaga

Coal Company to its stockholders .

DX 49a— Subpoena Questionnaire form and related court

orders

DX 49— Producer data exhibits, mine characteristics

DX 50— Producer data exhibits, comparison of leading

producers___

DX 651— Producer data exhibits, coal characteristics by

producing districts

DX 652— Producer data exhibits, overburden of strip mines

DX 53— Consumer data exhibits, boiler specifications

Dx 54— Consumer data exhibits, types of sales by produc-

ing districts i

DX 65— Consumer data exhibit, analysis of consumption

Mi 2 § BES Bsa es geese Fa

INDEX

(HURGTHE Ht Ht ]

a aoe

i ends

hi Ui Hi a ilk iH lists

i pm iuieeieye

fon Ag SRRASHRwY a

82— Plaintiff’s proposed of fact 5a, 5b, 6b(2),

5d(4) and 5e(8), Uatted bone Vv. Standard Oil

(New Jersey et al.), Civ. No. 954-64,

D. N.J. (1964)

83— Plaintiff's memorandum

Prep ngs of fact.and conclusions of x

J dal). ie tae ee rae

ersey, » Civ. No. «RE

84— j in United States y. P Coal

Company et al., Civ, No. 67 C 1621 (N.D. Ill.

nagh to Security Analysts

98— Commonwealth Edison: Profile of No. 1, Nucle-

onics Week, April 4, 11, 18 a

94— 1968 Annual Report of Commonwealth Edison _

96— “Edison Seek A-site Downstate,” Chicago Daily

News, March 9, 1970

96— Advertisement entitled “Nuclear Power for Chi-

cago,” Chicago Daily News, March 13, ant

97— Advertisement entitled “Commonwealth Edison

on Chicago's Air Pollution Problem,”

Chicago Sun Times, July 11, 1969

98— Advertisement entitled “Commonwealth Edison

Reports on Progress Toward Cleaner Air,” Chi-

cago Sun Times, August 27, 1969 a ss

99— Advertisement entitled “No Smoke. No Dirt.

No Fumes,” Chicago Tribune, February 8, 1970_

617

& &

2 ¢

2 88 3888 8% #

910

Defense Exhibits:—Continued

DX 100— Advertisement entitled “You're Looking at 20,000

Tons of ‘Coal’,” Chicago

DX 101— “Coal Strip ~ oft agen Peak?” by

gest a

Hubert E. Risser, Illinois

(September 18, 1968)

Session (1962) :

DX 103— Comparison of Coal-Fired and Nuclear Power

Plants for the TVA System, June, 1966

DX 104— Letter of October 17, 1962 from Elmer Hill to

DX 111— Letters of February 19 and 22, 1968 from Rich-

ard P. Ryan, General Counsel, Humble Oil and

Refining Company to John T. ee se

DX 14— statement of The United Electric Coal

954, 1955, 1956, 1957, 1958, 1959,

960

DX 116— Nuclear Power Briefing For The Coal Industry,

DX 136— entitled “Caution: Commonwealth

Edison is Hazardous to your Health”, Chicago

ow 6g eeeeelil ensiae

DX 137— entitled “Before everyone runs out

1041

INDEX

Defense Exhibits :—Continued

DX 144— Map entitled “Investor-Owned Electric Utility

Service Areas”

DX 145— Map re rae “Service Area, Dairyland Power

Cooperati

DX 146— 1966 Annual Report, Union Electric Company __

DX 147~— 1967 Annual Report, Union Electric Company ___

Dx 148— 1968 Annual Report, Union Electric Company _

DX 149— 1968 Annual Report, Northern States Power Com-

DX 151— Article entitled Dirty Air—A Grow-

Peril,” Chicago Sun Times, October 19, 1967_

DX 152— Article entitled “Antipollution, Antitrust Bills

June ag 8 bY Gov. Opilvie,” Chicago Sun Times,

une

DX 158— Article entitled “Crackdown on Air Pollution”

Chicago Sun Times, July 14, 1969

DX 157— Article entitled “Mikva Bill Would Make Air

, Pollution A Federal Offense,” Chicago Sun Times,

DX 159— Article entitled “ ‘Black Diamond’ Boom: Kleen-

burn Coal Mines Enjoy Demand Surge,” The Wall

Street Journal, January 7, 1970

DX 160— Article entitled “Business agp ee —

Background Report On Trends ustry

Finance,” The Wall Street Journal, March 19,

970

DX 161— Letter entitled “The News That Nobody Prints,”

Mid-West Coal Producers Institute, Inc.

DX 162— Article entitled “New Ruckus On Foreign-Oil

Imports To Pin Nixon Between Pollution Issue,

Coal Groups,” The Wall Street Journal, March

5, 1970

1187

1138

1139

1141

xii INDEX

Defense Exhibits :—Continued —

Dx 164— Article entitled “The Real Meaning Of Alaskan

Oi Finds,” U.S. News & World Report, March 8,

DX 165— Article entitled “Petroleum Firms At

Is Slated In 1975,”

The Wall Street Journal, December 15, 1967 ___

DX 172— Article entitled “Jersey Standard Joins List Of

Companies To Make N’ To

1143

1153

1154

1155

1156

1157

Defense Exhibits :—Continued

Dx 176— Article entitled “FPC Aide Again Approves Con

Edison Bid To Build Power Project; Protests

rixely" ‘The Wall Street Journal, August 7,

DX 177— Article entitled “TVA Plans To Start $155 Million

Project At Raccoon Mountain—Plan Will Include

pacity OF 14 Milde Rotana ee oe

DX 179— Article entitled “Earth’s Own Power Source,”

Chicago Daily News, January 9, 1969

DX 180— Article entitled “Burning Refuse To Be Used

In ‘Total Energy’ Concept,” The Wall Street

Journal, June 28, 1969

DX 181— Excerpt from transcript of Hearings before the

Joint Committee on Atomic Energy, 99th Con-

DX 182— Article entitled “New England Affiliation Slated

—Utiilty Concerns Plan Affiliation,” New York

DX 183— Article entitled “Boards of Iowa P&L And Iowa-

Illinois G&E Approve Merger Plan—New Entity,

Towa Energy Corp., Plans To Retire The 2 Utili-

ties’ Outstanding Preferred Shares,” The Wall

Street Journal, July 22, 1969

DX 184— Article entitled “Ayrshire Collieries Asks Bids of

5 Firms—Coal Concern Invites Offers To Pur-

chase Or Merge With It; Replies Expected Next

Month,” The Wall Street Journal, November 27,

1968

DX 185— Article entitled “Ashland Oil Plans To Buy Or

Lease Ayrshire Assets—Boards Vote Proposal

That Includes The Sale Of Coal Royalties To

Third Firm—Pact Involves $125 Million,” The

Wall Street Journal, January 22,1969.

DX 186— Article entitled “Metal Climax, Ayrshire Sign

Merger Accord—Acquisition Of Coal Producer

By Metals Firm Valued At Minimum Of $62.6

Million—Boards And Holders To Vote,” The Wail

Street Journal, April 24, 1969

1158

1159

1160

1161

1162

1168

1164

1165

1166

1167

1168

Defense Exhibits :—Continued

DX 187— Advertisement entitled “Air Pollution Authorities

Urge Use Of Natural Gas—

Today, More and More Own-

DX 188— Advertisement entitled “1977 The Year Our City

” Philadelphia , December 4, 1967_

i Ine.

DX 1 Advertisement entitled “How Nuclear Science

May Give America More Gas Energy.” American

Gas Association, Inc.

DX 194— Advertisement entitled “Boiler Conversion?”—

“Get The 5 Advantages Gas Power-Type Burners

Give You In Full Measure.”—“Midco Converts

An Apartment And The Service Staff Is Cut By

2/8.” American Gas Association, Inc.

DX 195— Advertisement entitled “Who Offers You 24-Hour

Plant Site Location Service On The 60-Mile Illi-

nois Shore? Peoples Gas, Of Course.” The Peoples

Gas Light And Coke Company And North Shore

Gas Company

DX 196— Advertisement entitled “The Not-So-Brief Case

For Complete Chicagoland Plant Site Informa-

tion,” The Peoples Gas Light And Coke Company

And North Shore Gas Company...

DX 197— Advertisement entitled “The Perfect Salt Substi-

tute,” American Natural Gas Company

DX 198— Advertisement entitled “St. Louis’ Tallest Office

Building Will Be Total Energy All The Way,”

The Wall Street Journal, May 18,1969

DX 199— Advertisement entitled “The Savings And Loan

That Saves With Natural Gas,” American Gas

Association, Inc.

DX 200— Advertisement entitled “Natural Gas Energy .. .

The Electrifier—Pretty Soon You May Be Making

Your Own Electricity From Natural Gas.”____

_ 1176

1177

1178

1179

1180

1181

1182

INDEX

Defense Exhibits :—Continued

DX 201— Advertisement entitled “What Do You Call It?

No Matter What You Call It There’s A Lot More

Coming From Natural Gas Energy—There’s A

Engines

- Cooling and Hesting-” Amer.

Energy This High School Needs Elec-

Y (res ag ee

ear,”

DX 208— itled “Williams Buys

Conditioning

Like A Car That’s Better Than Good.” Northern

Tlinois Gas Company =

Pair . . . By Charmgiow.” peelibit-cathsccl-daesdh.. dees ok

DX 212— Advertisement entitled “Now.

1187

1188

Inc... 1189

1190

1191

1192

, 1194

1196

1197

1198

1199

en entitled “Here’s The Story Of The

Gas Fuel Cell. It’s Electrifying.” American Gas

Association, Inc. ___ ldo 1201

DX 215— “Nuclear team-Generation of Electricity: Its .

1968,” Chicago Daily News, December 18, 1968__ 1228

DX 219— Letter dated March 9, 1970 from V. H. Clark,

-Treasurer, Electric Energy, Inc., to

Reuben L. Hedlund 1224

DX 220— Letter dated June 29, 1942 from Frank F. Kolbe

to B. L. Slack 1225

DX 221— Letter dated July 23, 1954 from Frank F. Kolbe

to Herman G. Schenck 1226

DX 222— Letter dated June 11, 1956 from Frank F. Kolbe 3

to Nye F. Morehouse ee 1227

DX 223— Brochure entitled “Taum Sauk, Union Electric’s

Pumped—Storage Hydro Plant.” 1228

DX 224— Press release, University of Chicago, January 19,

1970

man to R. J. Hepburn re Freeman analysis of

Kerr Mine 1236

DX 228— Excerpts from the Minutes of the Board of Di-

rectors of The United Electric Coal Companies

of September, 1966, pages 4886-4889. ===ssss«éd ggg

DX 229— Form 250 Response to the Court-Ordered Sub-

poena Questionnaire for the Freeman Coal Mining

Corporation aa

DX 2380— April 13, 1970 letter from Mr. Allen Van Wyck,

Chairman of the Board of Illinois Power Company,

to Donald G. Kempf, Jr. - 1244

DX 231— April 14, 1970 letter from K. E. Bowen, President

of Central Illinois Public Service Company, to

Donald G. Kempf, Jr. 1245

DX 282— Brochure entitled “Low Cost Electric Power and

Dependability ... Through MAPP” «3:24

DX 288— Brochure entitled “Mid-America Interpoo] Net-

work—MAIN”

sig

xviii INDEX

Deposition Exhibits: is

Abrahamson Deposition Exhibit 1—Front Cover of 1967

Annual Report of Wisconsin Power & Light Company__

Deposition Exhibit 1A—Back page of 1967

Annual Report of Wisconsin Power & Light Company_.

Beck Deposition Exhibit 1—Letter to Antitrust Division,

Department of Justice, Chicago, Illinois, from C. V.

Beck dated November 14, 1968

Brazzale Deposition Exhibit 1—Document entitled “Heat-

ing Fuel Economic Analysis” for the Federal Office

Building and United States Courthouse, Chicago,

Illinois

Burton Deposition Exhibit 1—Document entitled “Solicita-

tion, Offer, and Award Contract GS-05S-4945” issued

August 1, 1967

Camicia Deposition Exhibit 1—Keystone’s Map of the Coal

Fields of the United States _

Gallagher Deposition Exhibit 3—Mineral Industry Surveys,

Bituminous Coal and Lignite Distribution, Calendar

Year 1967

Griswold Deposition Exhibit 3—Report of the Secretary of

Health, Education, and Welfare to the Congress of the

United States entitled “Air Pollution by Federal Facili-

ties” and dated January 1968

Griswold Deposition Exhibit 4—Second Report of the Secre-

tary of Health, Education, and Welfare to the United

States Congress entitled “Air Pollutioii Abatement by

Federal Facilities” and dated January 1969... =

Griswold Deposition Exhibit 5—Document entitled “Oper-

ating Experience with Wet-Dolomite Scrubbing” by

J. F. McLaughlin, Executive Assistant, Union Electric

Co., St. Louis, Missouri, and J. Jonakin, Products Man-

ager, Air Pollution Control Systems, Combustion Engi-

neering, Inc., Windsor, Connecticut, presented at the Air

Pollution Control Association Annual Meeting in New

York City on June 22-26, 1969

Jensen Deposition Exhibit 12—Memorandum from Burl C.

Jensen to Mr. R. H. Inman dated June 7, 1965... s—

Jensen Deposition Exhibit 183—Memorandum from D. H.

Emling and B. C. Jensen to Mr. R. H. Inman dated June

. 7, 1966

Kolbe Deposition Exhibit 2—Annual Report of The United

Electric Coal Companies 1956

Kolbe Deposition Exhibit 4—Annual Report of The United

Electric Coal Companies 1958

Kolbe Deposition Exhibit 7—Annual Report of The United

Electric Coal Companies 1961

Kolbe Deposition Exhibit 12—Letter to Mr. W. B. Hillery,

unsigned, by the President dated February 27, 1957 ___.

Page

1409

1410

1411

1412

1413

1415

1416

1456

1470

1502

1519

Kolbe Deposition Exhibit 57—Annual Report of The United

Electric Coal Companies 1954

tween Alcoa and UEC dated September 5, 1956

Kolbe Deposition Exhibit A—Comparison between Truax-

Traer Coal Company and The United Electric Coal Com.

panies

Ibe Deposition Exhibit E—Notebook entitled “Report on

j Proposed Merged Illinois Operations, Truax-Traer Coal

Company, January, 1956” of Theron G. Gerow, Mining

Kolbe Deposition Exhibit L—Letter dated September 12,

1960 from J. M. Morris to Mr. Frank Nugent

ton, Delaware, & corporation of Delaware”

Kolbe Deposition Exhibit W-1—Letter from Frank Kolbe to

Harry LaViers dated February 25, 1958.

BREE Fy

1541

1542

1545

1547

1548

1549

1562

1565

1571

1587

1628

1629

1631

1634

1637

1639

xx INDEX

Deposition Exhibits :—Continued

mer to R. J. Hepburn dated November 7, 1955

Kurtz Deposition Exhibit 8—Steam-Electric

1968 Edition

1964

Latimer from T.

Latimer to Mr. R. H. Inman dated July 19, 1966 ___

Latimer Exhibit 48—Memorandum from T. H.

Latimer to Mr. R. J. Hepburn dated February 10, 1961_

Maguire Exhibit 1—General Proxy

Statement and Plan of Merger with

respect to Material Service Corporation dated November

24, 1959

Maguire Deposition 35—Excerpt from the Minutes of

Deposition

17, 1959 from R. J. Hepburn to Mr. J. M. Morris...

Morris Deposition Exhibit 4—Letter from Mr. John M.

Morris to Mr. Frank Nugent dated January 10, 1966 __

Morris Deposition Exhibit 5—Letter from J. M. Morris to

Mr. Frank Nugent dated March 14, 1966

Morris Deposition Exhibit 14—Letter dated May 8, 1965

from J. M. Morris to Mr. Frank Nugent _..

Morris Deposition Exhibit 31—Memorandum from R. J. Hep-

burn to Mr. J. M. Morris dated January 24, 1961

Morris Deposition Exhibit 82—Memorandum from R. J.

Hepburn to Mr. T. J. Tarzy and Mr. J. M. Morris dated

1960

February 24, ¥

Morris Deposition Exhibit 85—-Memorandum from R. J. Hep-

burn to Mr. J. M. Morris dated July 17, 1962...

1666

1669

1676

1678

1680

1682

1683

1686

1688

1689

fil:

Hilt.

Fidel

ill

xxii INDEX

Deposition Exhibits >—Continued

Nugent Deposition Exhiibt 7—Financial Reports: Freeman

AS Sieg Cepeeetion; Year Ended December 31,

Nugent Deposition Exhibit 8—Financial Reports: Freeman

Coal Mining Corpecation: Year Ended December 31,

Nugent Deposition Exhibit 9—Financial Reports: Freeman

Se Capen: Year Ended December 31,

Nugent Deposition Exhibit 11—Annual Report of the Chi-

Ja Teapinston and Franklin Coal Company for the

ear

Nugent Deposition Exhibit 16—Advertisement of Freeman

Lt Mining Corporation in 1967 Keystone Coal Buyers

Nugent Deposition Exhibit 17—Advertisement of The United

Electric Coal Companies in the 1967 Keystone Coal

Buyers Manual

Nugent Deposition Exhibit 19—Advertisement of The United

Electric Coal Companies in the 1968 Keystone Coal

Buyers Manual

Nugent Deposition Exhibit 20—Advertisement of The United

Electric Coal Companies in February 1968 issue of The

Black Diamond

Nugent Deposition Exhibit 22—Letter dated February 13,

1968 from Reuben L. Hedlund to T. Cusack re

Dividends Paid to MSC, GD on the Stock of

UEC, January 1, 1959 to December 27, 1967...

Nugent Deposition Exhibit 29—Annual Report of The United

Electric Coal Companies 1964

Nugent Deposition Exhibit 35—Invitation for Tenders of

Common Stock of The United Electric Coal Companies

by General Dynamics Corporation dated October 5, 1966_

Nugent Deposition Exhibit 38—Map entitled “Shipping Coal

Mines In Illinois” prepared by Jack A. Simon, State of

Illinois, Department of Registration and Education,

State Geological Survey, dated January 1, 1966.

Nugent Deposition Exhibit 89—Letter from Tom Tarzy to

Frank Nugent dated December 11, 1964 and Chart Show-

ing Midwestern Coal Consumption by Utility Plants,

1963

Electric Coal Companies eeting

held October 28, 1960 re Capital Appropriation for UEC.

Nugent Deposition Exhibit A—Letter from Frank Kolbe to

Henry Crown dated October 9, 1956

1772

1774

1776

1786

1793

1794

1796

1797

INDEX

Deposition Exhibits :—Continued

Pedersen Deposition Exhibit 5—United Electric Coal Com-

panies Computation of Provision for Federal Income

Taxes, Month of October 1966 and Ten Months Ended

October 31, 1966

Redard Deposition Exhibit 1—Keystone Steel and Wire Com-

Poe ter te Department of Justice dated April 26,

Simon Deposition Exhibit 1—Simon, J.A., An Evaluation of

Illinois Coal Reserve Estimates, 1968

Dynamics,

et al., Memorandum of Expected Testimony of Peter O.

Steiner, Professor of Economics and Law, University of

Michigan dated August 14, 1969

Terleke Deposition Exhibit 2—Mid-West Coal Producers

Institute, Inc. Report of Mine Performance, 1957-1958__

Terleke Deposition Exhibit 11—Mid-West Coal Producers

Institute, Inc. Report of Mine Performance, 1966-1967__

Weir Deposition Exhibit 1—Shipping Coal Mines (Map),

Weir Deposition Exhibit Memorandum from R. H. In-

man to Mr. R. J. H dated August 5, 1959...

Weir Deposition Exhibit 19—Brochure entitled “Paul Weir

Company” ;

1841

1847

Table G - 1F

ANALYSIS OF SALES TO ELECTRIC UTILITIES OF COAL

PRODUCED IN FULTON-PEORIA PREIGHT DISTRICT

SSSED IN FULTON-PEORIA FI RATE DISTRICT

Utility Pacilities Located in Pulton-Peoria Sales Area

Company Facility City County State

Illinois > Havana Havana Mason Illinois

Hennepin Hennepin Putnam Illinois

CILCO Edwards Bartonville Peoria Illinois

Liberty Peoria Peoria Illinois

Wallace E. Peoria Tazewell Illinois

CIPS Meredosia Meredosia Morgan Tllinois

Coal on by Utils Facilities Located in Pulton-Peoria s Area

Tons Consumed % of Total

Sos. Consumption

Pulton-Peoria Production Consumed

by Utilities in Sales Area 1984 808

Consumption of Coal Produced in

Other Frieght Rate Distric in

Mining “tee 9, 10 « 123

le 493 20%

West Kentucky mt 494 ot 20%

TOTAL CONSUMPTION BY

UTILITIES IN SALES

AREA . 2478 1008

Fulton-Peoria Production Sold to Utilities

en Sold to Utilities

: Tons Produced % of Total

(000) Production

Sold to Utilities in Sales Area 1984 348

Sold to Commonwealth Edison 3794 65%

Sold to Other Utilities __28 it

TOTAL PRODUCTION SOLD TO UTILITIES

BY MINES IN FULTON-PEORIA FRT. DIST. 5806 100%

Source: Government Questionnaire

2/ Excludes shipment: of 92,000 tons of dust from Crown Mine in Springfiela

District to Meredosia facility c° “TPS. See CIPS Porm 150 (Meredosia),

Subpoena Qvestionnaire.

Table G - 2F

ANALYSIS OF SALES TO NON-UTILITY FACILITIES OF COAL

PRODUCED IN THE FULTON-PEORIA FREIGHT RATE DISTRICT

1. Destinations in Fulton-Peoria Sales Area

City County State

Abingdon Knox Illinois

Aledo Mercer Illinois

Alexis Warren Illinois |

Altona Knox Illinois |

Atkinson Henry Illinois |

Bartonville Peoria Illinois

Beardstown Cass Illinois

Bishop Hill Henry Illinois

Bushnell -. McDonough Tllinois

Cambridge . Henry Illinois

Canton < Pulton Illinois

Cedar Point LaSalle Illinois

Chillicothe Peoria Illinois

Colchester McDonough «Illinois

Cuba Pulton - Illinois

Dixon Lee Illinois

E. Moline Rock Island Iliinois

E. Peoria Peoria Illinois

Edelstein Peoria Illinois

Edwards Peoria Illinois

Elmwood Peoria Illinois

Erie Whitesdie Illinois

Pairview Pulton Illinois

Parmington Pulton Illinois

Galesburg Knox Illinois

Galva Henry Illinois

Geneseo Henry Illinois

Gilchrist Mercer Illinois

Garden Plain Whiteside Illinois

Kewanee Henry Illinois

Knoxville Knox Illinois

Lacon Marshall Tllinois

Lafayette Stark Illinois

LaSalle LaSal Tllinois

Laura Peoria Illinois

Lewistown Pulton Illinois

Liverpool Pulton Illinois

Lyndon Whiteside Illinois

City

Macomb

Manlius

Mapleton

Marseilles

Mossville. ~

Mt. Sterling

Normandy ...

Norris

Oglesby .

Osco

Ottawa

Pekin

Peoria

Peoria Heights

Peru

Port Byron

Princeton

Princeville

Prophetstown

Rapatee

Rock Falls

Rock Island

Rushville

St. David

Seneca

S. Pekin

Spar land

Sterling

Stronghurst

Tiskilwa

Toulon

Walnut

Warsaw

Washburn

Wenona

Williamsfield

Woodhull

Wyoming

Knox

Whiteside

Rock Island

Schuyler

Fulton

LaSalle

Tazewell

Marshall

Whiteside

Henderson

Bureau

Stark

Bureau

Hancock

Woodford

Marshall

' State

Illinois

484

Table G - 2F

Cont 'd

City County ~ State

Bettendorf Scott Towa

Buffalo Scott Towa

Clinton Clinton Towa

Scott - Towa

meneetans Muscatine Iowa

Princeton Cott Towa

2. Coal Consumption by Non-Utility Facilities Located in Fulton-Peoria Sales Area

5 Tons Consumed % of Total

i. | Consumption

by Non-Utilities in Sales Area * 2872 se

Coal Produced in Other

Preight Rate Districts in Mining

Districts 9, 10 & li

Southern Illinois 2511/ 98

lle 7 *

Springfield beh)

West Kentucky 32 1s

Mineral-Atkinson 284 574 _108

TOTAL CONSUMPTION BY NON- YS

UTILITIES IN SALES AREA 2945 10082/

Source: Government Questionnaire

Includes 73,000 tons (3%) of low-sulphur coal (1.2%) from Freeman's Orient

#3 Mine in the Southern Freight District to the Dixon Plant of Medusa

Portland Cement for equipment requiring coal having a maximum sulphur

content of 1.2%. See Medusa Portland Cement Form 150, Subpoena Question-

naire and letter of August 15, 1968 from Thompson, Hine and Flory to

Plaintiff.

The apparent @iscrepancy between actual sum of the subtotals above and

the total above is due to rounding. Each figure has been rounded to

the nearest one percent.

Fulton-Peoria Production Sold to Non-Utilities

Tons

(000)

Sold to Non-Utilities in Sales Area 2371

Sold to Greater Chicago Air Quality 1004

Control Region :

Sold to Other Non-Utilities 336

TOTAL PRODUCTION SOLD TO NON-

UTILITIES FROM MINES IN PULTON-

PEORIA FRT. DIST. 3711

Source: Government Questionnaire

Table G - 2F

Cont 'd

Table G - 3p

——— SE

RECAPITULATION OF SALES OF

COAL PRODUCED IN THE FULTON-

PEORIA FREIGHT RATE DISTRICT

TROT

1. Coal Consumption by All Facilities in Pulton Peoria Sales Area

Tons Consumed % of Total

000 Consumption

Fulton-Peoria Production Consumed

by All Facilities in Sales Area 4355 80%

Consumption of Coa) Produced in

Other Preight Rate Districts :

in Mining Districts 9, 10 ¢ 111/

Belleville * 500 98

Southern Illinois 251 — 5%

Springfield 1 tee

West Kentucky 32 18

Mineral-Atkinson 284 ‘1068 5% 20%

TOTAL CONSUMPTION OF COAL wees ee a a

BY FACILITIES IN SALES AREA 5432 100%

*- Fulton-Peoria Production Sola to All Facilities

Tons Produced % of Total

(000) Production

een 1.) Se =roduction

Sold to Pacilities in Sales Area 4355 46%

\ Sold to Commonwealth Edison 3794 40%

\ sola to Chicago Air Quality 1004 11%

\ Control Region

Sold to Other Pacilities 364 4%

TOTAL 5517 To0e2/

Excludes shipment of 92,000 tons of dust from Crown Mine in Springfield

District to Meredosia facility of cIPs.

Includes 73,000 tons (4%) of low-sulphur coa) (1.2%) from Preeman's Orient

#3 Mine in the Southern Freight District to the Dixon plant of Medusa

content of 1.2%, See Medusa Portland Cement. Form 150, Subpoena Question-

naire and letter of August 15, 1968 from Thompson, Hine and Flory to

Plaintiff.

The apparent @iscrepancy between ac il sum of the subtotals above and

the total above is due to rounding. “ch figure has been rounded to the

nearest one percent

487

Table G - ls

ANALYSIS OF SALES TO ELECTRIC UTILITIES OF COAL

PRODUCED IN SPRINGFIELD FREIGHT RATE DISTRICT

Utility Pacilities Located in Springfield Sales Area

Company Pacility County State

CIPS Coffeen Montgomery Illinois

SPRINGFIELD WLEP _ Springfield Sangamon Illinois

Coal Consumption by Utility Facilities Located in Springfield Sales Area

» Tons Consumed

. 000)

Springfield Production Consumed

by Utilities in Sales Area 1406

Consumption of Coal Produced in

Other Freight Rate Districts in

Mining Districts 9, 10 € 11 0

TOTAL CONSUMPTION BY UTILITIES

IN SALES AREA 1406

Springfield Production Sold to Utilitiesl/

Tons Produced

(000)

Sold to Utilities in Sales Area 1406

Sold to Commonwealth Edison 7191

Sold to Other Utilities 0

TOTAL PRODUCTION SOLD TO UTILITIES

BY MINES IN SPRINGFIELD FRT. DIST, 8597

Source: Government Questionnaire

% of Total

Consumption

100%

% of Total

Production

2/ Excludes 92,000 tons of dust shipped from the Crown Mine of

Freeman to the Meredosia facility of CIPS. See CIPS Form 150

(Meredosia), Subpoena Questionnaire.

Po me res inp te

ANALYSIS OF SALES TO Non

——PROPUCED IN THE SPRI?

Destinations .in_the Springfield sales Area

City

myers

atur

Edinburg

Hillsboro

Irving

Kincaid

Mechanicsburg

Morrisonville

Nokoniis

Oconee

Pana

Pawnee

Ransey

Riverton

Springfield

Witt

County

Macoupin

Macon

Christian

Montgonery

Montgonecry

Christian

Sangamon

Christian

Montgonery

Shelby

Christian

Sangamon

Fayette

Sanganon

Sangamon

Montgouiery

Table ¢

“UTILITY FACILTYIES OF COAL

‘GPIELD FREIGHT RATE DISTRICT

State

Illinois

Tllinois

Illinois

Tllinois

Illinois

Tjlinois —

Illinois

lllinois

Table G - 2s

Cont'd

2. Coal Consumption by Non-Utility Facilities Located in Springfield

Sales Area cee : J :

Tons Consumed % of Total

(000) Consumption

Springfield Production Consumed

by Non-Utilities in Sales Area 349 » 808

Consumption of Coal Produced in

Other Freight Rate Districts in

Mining Districts 9, 10 & 11

“ Southern 4 18

438

Springfield Production sold to Non-Utilities

Tons Produced % of Total

(000) Production

Sold to Non-Utilities in Sales

Area 349 89%

Sold to Greater Chicago Air

Quality Control Region 19 5s

Sold to Other Non-Utilities 24 6%

TOTAL PRODUCTION SOLD TO NON-

UTILITIES FROM MINES IN

SPRINGFIELD PRT. DIST.

Source: Government Questionnaire

Table G-35

RECAPITULATION OF SALES OF

COAL PRODUCED IN THE SPRINGFIELD

FREIGHT RATE DISTRICT

1. Goal Consumed by All Facilities in Springfield Sales Area

Tons Consumed % of Total

(000) Consumption

Springfield Production Consumed :

by All Pacilities in Sales Area 1755 958

Consumption of Coal Produced in

Other Freight Rate Districts

in Mining Districts 9, 10 6 ll

Southern : 4 e

Murdock 63 38

Danville 12 18

Indiana 8 e

West Kentucky a 89 ae 4%

TOTAL CONSUMPTION OF COAL BY

FACILITIES IN SALES AREA 1844 1o0el/

2. “Springfield Production Sold to All Pacilities2/

Tons Produced % of Total

(000) Production

Sold to Pacilities in Sales Area 1755 208

Sold to Commonwealth Edison 7191 soe

Sold to Chicago Air Quality 19 ®

Control Region

Sold to Other Facilities 24 e

TOTAL B5e5 Toot

i/ The apparent discrepancy between actual sum of the subtotals above and

the total above is due to rounding. Each figure has been rounded to the

nearest one percent.

2/ Excludes 92,000 tons of dust shipped from the Crown Mine of Freeman to

the Meredosia facility of CIPS. See CIPS Form 150 (Meredosia), Subpoena

Questionnaire.

Source: Government Questionnaire

Table G - 18

ANALYSIS OF SALES TO ELECTRIC UTILITIES OF COAL

PRODUCED IN BELLEVILLE FREIGHT RATE DISTRICT

sees anne

1. Utility Pacilities Located in Belleville Sales Area

Company Facility City County State

Dairyland Power Stoneman Cassville Clayton Wisconsin

Dairyland Power Alma _ Wabasha Wisconsin

Dairyland Power Genoa Genoa Vernon Wisconsin

Wisconsin P & L Nelson Cassville Clayton Wisconsin

Elk River Rural Co- Elk River Elk River

operative .

No rn Sts. Power French Islan@ LaCrosse LaCrosse + Wisconsin

Northern Sts. Power ng Red Wing Goodhue Minnesota

Northern Sts. Power Winona Winona Winona Minnesota

. Northern Sts. Power Ki Stillwater Washington Minnesota

Northern Sts. Power High Bridge St. Paul Ramsey Minnesota

Northern Sts. Power Black Dog Minneapolis Ramsey Minnesota

Northern Sts. Power Riverside Minneapolis Ramsey Minnesota

Interstate Power Dubuque Dubuque Iowa

Interstate Power Lansing Lansing Almakee | Towa

Interstate Power Kapp : Clinton Muscatine Iowa

Municipal Electric Muscatine Muscatine Muscatine Iowa

E. Iowa Light & Power Montpelier Montpelier Muscatine Iowa

Towa-Ill. Gas & Elec. Riverside Bettendorf [Iowana}] Scott Iowa

Ill. Power Wood River Wood River Madison Illinois

City of Highland Highland Highland Madison Illinois

Union Electric * Venice Venice Madison Illinois

Uniom Electric Cahokia Cahokia Sinclair Illinois

Union Electric Ashley St. Louis St. Louis Missouri

Union Electric Meramec St. Louis St. Louis Missouri

Central Elec.

Power Coop. Chamois Chamois Callaway Missouri

2. Goal Consumption by Utility Pacilities Located in Belleville Sales Area

Tons Consumed & of Total

(000)

Belleville Production Consumed

by Utilities in Sales Area 7595 bie

Consumption of Coal Produced in

Other Freight Rate Districts in

Mining Oistricts 9, 10 6 ll

Southern?/ , 895 108 208

Pulton Peoria > < e

West Kentucky 453 58

Mineral-Atkinson 426 1778 58 tee

TOTAL CONSUMPTION BY 2/

UTILITIES IN SALES ARFA 9373 100%

Table G - 18

(Cont 'd)

3. Belleville Production Sold to Utilities

; Tons Produced % of Total

(000) Production

Sold to Utilities in Sales Area 7595 46%

Sold to Commonwealth Edison 6514 39%

Sold to Greater Chicago Air Quality 1279 se

Control Region

Sold to Other Utilities 1296 8%

TOTAL PRODUCTION SOLD TO UTILITIES

BY MINES IN BELLEVILLE FREIGHT

DISTRICT : 16684 100%

2/ Bxcludes 1,171,337 tons of dust from the follow mines in the Southern

Source: Government Questionnaire

Freight District to the following utility facilities: Sahara to the

Cahokia (59,000) and Venice (76,000) plants of Union Electric; Old Ben

No. 9 to the Venice (49,000) and Meramec (319,000) plants of Union

Electric; Orient No. 3 to the Venice (112,369) and Meramec (191,828)

plants of Union Electric, the Wood River (181,132) plant of Illinois

Power and the Alma (53,911) plant of Dairyland Power; Orient No. 5 to

the Alma (29,097) plant of Dairyland Power. See corresponding Forms

150, Subpoena Questionnaire.

The apparent discrepancy between actual sum of the subtotal above and

the total above is due to the rounding. Each figure has been rounded

to the nearest one percent.

sevice vw ~ £40

ANALYSIS OF SALES TO NON-UTILITY FACILITIES OF

DISTRICT

COAL PRODUCED IN THE BELLEVILLE FREI

1. Destinations in Belleville Sales Area

City

Alton

Belleview

Belleville

Chester

Collinsville

EB. Alton

B. St. Louis

Edwardsville

Evansville .

Freeburg

Granite City —

Madison

Marissa

Mascoutah

Millstadt

Spart

Staunton

Steeleville

Swanwick

Venice

Willisville

Wood Ri

Koch .

Prospect Hill

St. Charles

St. Louis

Weldon

County

Madison

Calhoun

St. Clair

Randolph

State

Illinois

Tllinois

Illinois

Illingis

Tllinois

Zllinois

Illinois

Tllinois

Illinois

Missouri

OE gy

Coal Consumption by Non-Utility Pacilities Located in

Belleville Sales Area

Belleville Production Consumed

By Non-Utilities in Sales Area

Consumption of Coal Produced in

Other Freight Rate Districts in

Mining Districts 9, 10 & 11

Southern

107

Indiana i

West Kentucky 5

TOTAL T BY NON-

UTILITIES IN AREA

2150

Belleville aces Sold to Non-Utilities

Sold to Non-Utilities in Sales Area

Sold to Greater Chicago Air Quality

Control Region

Sold to Other Non-Utilities

TOTAL PRODUCTION SOLD TO NON-

UTILITIES FROM MINES IN

BELLEVILLE FREIGHT DISTRICT

Source: Government Questionnaire

Tons Produced

(000)

2027

763

409

3199

(Cont'd)

% of Total

Consumption

94%

% of Total

Production

63%

24%

13%

100%

Table G — 3B

tion All Facilities in Belleville Sales Area

Tons Consumed % of Total

tnt is Consumption

Belleville Production Consumed

by All Pacilities in Sales Area 9622 84%

Consumption of Coal Produced in .

Other Freight Rate Districts

in Mining Districts 9, 10 & 11

Southern -Illinoi 1002 9%

Pulton-Peoria ‘4 *

Mineral-Atkinson 426 at

West Kentucky 468 4a

Indiana NES 901 ®.. 17%

TOTAL CONSUMPTION OF COAL BY

FACILITIES IN SALES AREA 11523 10082/

Belleville Production Sold to All Facilities

Tons Produced % of Total

(000) Production

Sold to Pacilities in Sales Area 9622 46g

Sold to Commonwealth Edison 6514 33%

Sold to Chicago Air Quality 2042 10%

Control Region

Sold to Other Facilities 1705 9%

TOTAL Tsees Yoou2/

Excludes 1,171,337 tons of dust from the following mines in the Southern

Freight District to the following utility facilities: Sahara to the

Cahokia (59,000) and Venice (76,000) plants of Union Electric; Old Ben

No. 9 to the Venice (49,000) and Meramec (319,000) plants of Union

Electric; Orient No. 3 to the Venice (112,369) and Meramec (191,828)

plants of Union Electric, the Wood River (181,132) plant of Illinois

Power and the Alma (53,911) plant of Dairyland Power; Orient No. 5 to

the Alma (29,097) plant of Dairyland Power. See corresponding Forms

150, Subpoena Questionnaire.

The apparent discrepancy between actual sum of the subtotal above and

the total above is due to rounding. Each figure has been rounded to

the nearest one percent.

Table G - 150

ANALYSIS OF SALES TO ELECTRIC UT IES OF COAL

- IN SOUTHERN IS) PREI RATE DISTRICT

1. Utility Pacilities Located in Southern Sales Area

Company Facility City County State

TVA Shawnee Paducah McCracken Kentucky

State of Wis.P.Plt Waupun Fond du Lac Wisconsin

Wise. P&L Edgewater Wisconsin

Wise. E. P. Port Washington Port Washington Ozaukee Wisconsin

Wise. B. P. Oak Creek Oak Creek Milwaukee Wisconsin

Wisc. E. P. Lakeside St. Prancis Milwaukee Wisconsin

Wisc. Pub. Serv. Weston Green Bay Brown Wisconsin

Wisc. Pub. Serv. Pulliam Rothschild Marathon Wisconsin

Lake Sup.Dist.Pwr. Bayfront Ashland Ashland Wisconsin

Marshfield E & W Wildwood Marshfield Wood Wisconsin

Eew Menasha Menasha Winnebago Wisconsin

Blectric Energy ~ Joppa Joppa Massac Illinois

Grand Tower Grand Tower Jackson Tllinois

So.111.Pow.Coop. Marion Marion Williamson Illinois

Union Electric Sioux W. Alton St. Charles Missouri

N.E.Mo.E.Pwr.Coop. South River Palmyra Marion Missouri

Ia. BE. L. & P. Sutherland Marshall Marshall Towa

Ia. BE. L. & P. 6th St. Station Cedar Rapids[Crandic] Linn Iowa

Ia. BE. L. & P. Towa Falis Iowa Falls Rardin Towa

Ia. - Ill. Gas Iowa City Iowa City Johnson Towa

Ia. Public Serv. Waterloo Black Hawk Iowa

Munic. P&L Dept. Grundy Center Iowa

Mun .Util. Spencer Clay Iowa

Munic.Light Plt. Sibley Osceola Iowa

Cedar Falls Util. Cedar Palls Black Hawk Iowa

Iowa So. Util. Bridgeport Eddyville Wapello Iowa

Webster City LéP . Webster City Hamilton Iowa

Austin Utilities Austin Mower Minnesota

Interstate Power Sherburn Martin Minnesota

Board of L & P City of Marquette Marquette Marquette Michigan

2. Coal Consumption by Utility Facilities Located in Southern Sales Area

Tons Consumed % of Total

(000) Consumption

Southern Production Consumed

by Utilities in Sales Area 7232 48st

Consumption of Coal Produced in

Other Freight Rate Districts

in Mining Districts 9, 10 & ll

Bellevillei/ 629 “a

Mineral-Atkinson 536 ae

Murdock 3) 18

West Kentucky2/ 632 428

Indiana _32 7899 _28 538

TOTAL CONSUMPTION BY

UTILITIES IN SALES AREA 15132 100%3/

497

thern on to Utili

Tons Produced % of Total

Production

Includes (1) 213,000 tons (3%) from the Fidelity Mine of United Blectric

to the plant of TVA in Paducah, Kentucky, shipped under a Freeman

contract. In response to Form 150 of the Subpoena Questionnaire, TVA

received no other Belleville Freight District coal. In response to the

Wisconsin Power & Light in Green Bay, Wisconsin shipped under a Freeman

contract. See also Morrison Dep. Tr. p. 18.

Included within West Kentucky total is a one-third allocation 185,805.90)

of the 557,417.70 tons shipped in 1967 from Tab-Badgett Lakeview Mine to

“T.V.A."s Widow Creek, Gallatin, and Shawnee Plants." In the absence of

any evidence to the contrary, one-third of the aggregate tonnage has been

attributed as the portion shippea to the Shawnee Plant in the Southern

Utility Sales Area.

The apparent @iscrepancy between actual sum of the subtotals above and

the total above is due to rounding. Each figure has been rounded to the

nearest one percent.

Excludes 1,171,337 tons of dust from various mines to Belleville sales

area utilities. See Footnote 2, Table G-1B.

Source: Government Questionnaire.

ANALYSIS OF SALES TO NON-UTILITY

PACILITIES OF COAL

PRODUCED IN THE SOUTHERN (ILLINOIS) FREIGHT RATE DISTRICT!/

Payette

Jones

Mahaska

Wapello

Keokuk

Cedar

Van Buren

Tama

Cont'd

City County State

Tipton Cedar Iowa

Vinton Benton Iowa

Washington Washington Iowa

Waterloo Black Hawk Iowa

W. Des Moines Polk Iowa

Adell Wisconsin

Appleton Outagamie Wisconsin

Ashland Wisconsin

Biron Wood Wisconsin

Cudahy Milwaukee Wisconsin

Eden Fond du Lac Wisconsin

Green Bay Brown Wisconsin

Kaukauna Outagamie Wisconsin

Kenosha Kenosha Wisconsin

Kimber1] > Outagamie Wisconsin

Knowles Dodge

Manitowoc 2 Manitowoc Wisconsin

Marinette Marinette Wisconsin

Marshfield Wood Wisconsin

Merrill Lincoln Wisconsin

Milwaukee Milwaukee Wisconsin

Mosinee Marathon Wisconsin

Nekoosa Wood Wisconsin

Oak Creek Milwaukee Wisconsin

Owen Clark Wisconsin

Pt. Edwards Wood Wisconsin

Racine Racine Wisconsin

Rhinelander ‘ Oneida Wisconsin

Rothschild Marathon ee

Sheboygan Sheboygan Wisconsin

South Milwaukee Milwaukee q Wisconsin

Stevens Point Portage Wisconsin

Stratford Marathon Wisconsin

Thorpe Clark Wisconsin

Tomahawk Lincoln Wisconsin

Waupun Dodge Wisconsin

Wausau Marathon 2 Wisconsin

West Allis Mi lwaukee Wisconsin

Weyauwega Waupaca Wisconsin

Winne Winnebago Wisconsin

Wisconsin Dam Lincoln Wisconsin

Wisconsin Rapids Wood Wisconsin

Gladstone Delta Michigan

Marguette Marquette Michigan

Menominee Menominee Michigan

Ontonagon Ontonagon Michigan

Albert Lea Freeborn Minnesota

Austin Mower Minnesota

ER nan te son gene re om easton = ee

500

Table G - 2S0

(Cont'd)

City County State

Blue Earth Pairbault Minnesota

Fairmont Martin Minnesota

Hayward Freeborn Minnesota

Windom Cottonwood Minnesota

Worthington Nobles Minnesota

Campbell Dunklin Missouri

Chaffee Scott Missouri

Dolly Siding St. Francois Missouri

Jackson Cape Girardeau Missouri

Kirksville Adair Missouri

Ste. Genevieve Missouri

Morehouse -New Madrid Missouri

Poplar Bluff Butler Missouri

S. Troy - Lincoln Missouri

Trenton Grundy Missouri

Louisiana - Pike Missouri

Clarksville Pike Missouri

Hannibal : Marion Missouri

Ste. Genevieve Ste. Genevieve Missouri

Cape Girardeau Cape Girardeau Missouri

Paducah [Chiles} McCracken Kentucky

goa) Consunptich by Non-Utility Pacilities Located in Southern Sales

Tons Consumed % of Total

(000) Consumption

Southern Production Consumed by

Non-Utilities in Sales Area 2739 69%

Consumption of Coal Produced in

Other Preight Rate Districts

in Mining Districts 9, 10 & ll

Pulton Peoria 47 1%

Belleville 86 2%

Mineral-Atkinson 57 1%

West Kentucky 635 16%

Indiana 400 1225 10% 30%

TOTAL CONSUMPTION BY NON- |

UTILITIES IN SALES AREA 3964 100%2/

501

3. Southern Production Sold to Non-Utilities

Tons Produced % of Total

| __(900) Production

Sold to Non-Utilities in Sales Area 2739 440

Sold to Greater Chicago Air Quality 1738 288

Control Region

Sold to Other Non-Utilities 1802 29%

TOTAL, PRODUCTION SOLD TO NON-

UTILITIES FROM MINES IN

SOUTHERN FREIGHT DISTRICT 6279 100%

i/ Excluding sales of 1,931,092 tons of metallurgical coal from the Orient

mines of Freeman, the Sahara mines of Sahara, Old Ben mine No. 21 and

Zeigler mine No. 4.

2/ The apparent discrepancy between actual sum of the subtotals above and

the total above is due to rounding. Each figure has been rounded to

the nearest one percent.

Source: Government Questionnaire

oa ne ee

Table G - 3s0

RECAPITULATION OF SALES OF

IN THE

COAL P.

SOUTHERN (ILLINOIS) FREIGHT RATE DISTRICT

1. Coal Consumption by All Facilities in Southern Illinois Sales Area

Tons Consumed % of Total

(000) Consumption

Southern Production Consumed by

All Pacilities in Sales Area . 9971 52%

Consumption of Coal Produced in

Other Freight Rate Districts

in Mining Districts 9, 10 & 11

Bellevillel/ 705 4a

Pulton-Peoria 47 *

Mineral-Atkinson 587 33%

Murdock 91 *

West Kentucky2/ 6966 36%

Indiana 728 9124 _4% . 478

TOTAL CONSUMPTION OF COAL

BY PACILITIES IN SALES

AREA 19095 100%3/

Southern Production -Sold to All Pacilities$/

Sold to Facilities in Sales Area

Sold to Commonwealth Edison 120 1%

Sold to Chicago Air Quality 1738 11%

Control Region

Sold to Other PacilitiesS/ 3555 23%

TOTAL Ts3e¢ Too

Includes (1) 213,000 tons (3%) from the Pidelity Mine of United Electric

to the Shawnee plant of TVA in Paducah, Kentucky, shipped under a Preeman

contract. In response to Porm 150 of the Subpoena Questionnaire, TVA

received no other Belleville Freight District coal. In response to the

Government questionnaire, no other Belleville producer reported sales to

(Ai Yeon also, Nugent Dep. Tr. p. 235. (2) Also includes 132,000 tons

(2%)

the Pidelity mine of United Electric to the Weston plant of

i in Power & Light in Green Bay, Wisconsin shipped under a Freeman

contract. See also Morrison Dep. Tr. p. 18.

2/ Included within West Kentucky total is a one-third allocation [185, 805.90)

of the 557,417.70 tons shipped in 1967 from Tab-Badgett Lakeview Mine to

"T.V.A.'s Widow Creek, Gallatin, and Shawnee Plants." In the absence of

any evidence to the contrary, one-third of the aggregate tonnage has been

attributed as the portion shipped to the Shawnee Plant in the Southern

Utility Sales Area. *

The apparent discrepancy between actual sum of the subtotals above and

the total above is due to rounding. Each figure has been rounded to the

nearest one percent.

Excluding sales of 1,931,092 tons of metallurgical coal from the Orient

mines of Freeman, the Sahara mines of Sahara, Old Ben mine No. 21 and

Zeigler Mine No. 4. :

5/ Excludes 1,171,337 tons of dust from various mines to Belleville sales

area utilities. See Footnote 2, Table G-1B.

Coal Consumption by Facilities Located in Chicago Air Quality Control

% of Total

Consumption

248

148

lf The Metropolitan Chicago Interstate Air Quality Control Region, as

Gesignated 42 C.F.R. §81.14 (33 F. R. 17176, Nov. 20, 1968), consists

of Lake, McHenry, Cook, Du » Kane and Will Counties in Illinois

and Lake and Porter Counties Indiana. Tonnage to Commonwealth

Edison facilities has not been included.

2/ The apparent discrepancy between actual sum of the subtotals above

and the total above is due to rounding. Each figure has been

rounded to the nearest one percent.

Source: Government Questionnaire

~-----=---= FREIGHT RATE DISTRICT --~~.~.....

Fulton- '

Peoria spesamesone Belleville Southern

PRODUCTION P TON PRODUCTION

Other* TOTAL

PRODUCTION CONSUMPTION

Ses 5 Jone Ree 8.

53% 28,388 45%

9,497 158

17,619 28%

7,361 12,

62,865 100%

1008 19383

313,38 a fs SS _ 6

9517 2008 100% 19883 100% 15384 53,773 200%

Single Freight

Rate District

ive 37% 29%

Source: Tables G-l1F, 2P; G-1S, 2S; G-1B, G-150, 2s0

* From other Freight Rate Districts in mi » Districts 9, 10 and 11.

000% a2

000° 122

- 900*se2

coo" eo?

C0009?

coo*ew

000 ‘say

zona vzownsUCg

OTIOOTY ¢ C&D SYOCTTIT-wHoY

OFNB90TE g SD TIT rerqu9g

VIPPT ¢ tOneg “PeUCOS TH

*€oog zoneg purtArTeq*

sodog 4 WITT OVIWOTZ VMOT

LOMOs OYPYSIN}UT

OOTAROS OTTO, STPUDOCTA

COTALOG OTIqMY BUVTpUL *Ox

MBPT SyOUFTIL (19U29

Janey 90707g Wayytox

Senos OT4400TE UPTVOOET A

@oTs2Og OFS “TTL TerqUI9

Azcug 9pzzoo7y

senog SFOUTTTL

opZOeTE vOTUR

Res 2 ting

Mi bl obs

bout

OLET~Pronpery TSO) STOUTTTY Jo yzE°N9 poem seTaTTTIG

COO" TZ8“S> = OSsT 207 uoyjonpary seTes syouTTTT 17201

Coo CourLe +++ acl GuvED

Mat | SReoUBTTSOeT}

OF GT te ** Tents Ca areas

i ae "Tix ‘emeouury, 86a"

000 ot "TU ‘yposepoq, 000'sz

co0*ot OR200TS UD RIOTA 2 CUBTpET «= GOO TET

000*sT “*TTL ‘temeeg *sy §=— C90 ec

coo‘ st : woetpa 470330q 000"z00"»

coo*se "STA ‘comezmIry «= (020

cof ge SeTsTIT1a Famesotmy «= 000 4,

Coofor _ a@hog wTmsuTUEZ z0eddg — 9099

000 oO L¥z2¥ “od ‘Teqrusg §=—_- E00 OD

coo*os wor ‘oupROsM, G00" On

<0o%se STOUYD—LOMOT COTE TeIyWYD —C00*zp

cco*ee OOTAIOS OFTqNg BMOL = COO TOT

000*%e fore, Opttoets Toss gz = 000"K0

Q00'00 —- aenoz yoTzg0nI zoptedng emPy — OCOF LTT

<0’ 26T "tir ‘prersoetad> «= coe “eet

*@xzTeuucTzsenh euecdqns ‘0ST wx0, :edzn0s

(8ST) oe (%€) (89) (88) (t00T) |

660% sv zor 86S 606°L ZSL°ET SOT3TTTIN-UON

(89Z) (2) (88) (80) (878) (800T)

9ss “st vet 0 0z6‘T 67E°Z | SOTAITTITIN T1ews

(€T) . (LT) (842) (86T) (806) (800T)

986°6 9z°2T ozT‘ oz £68‘€T L60‘99 ZOZ‘HL| SOTITTIIN S627

Sze9, S20K 20 suoL eaky *a@ zeuwnsucS

y-T 6-S SXVOX PT-OT S2VOX GT-ST S2¥E% OZ YORTZUOD suo, TeZ0L 30 eddy

Tez0L L96T

:uotzezNG L96T

ZO 830823U0D Zepun pezz;uMOD ebeuUO, TenUUy

SUOL ZO 8,000'T

es xa wins waann ary dass

510

*eouo ATuo pezunco useq eAeY SeT3TTTGQed¥o TTO pue seh YI0q 4RTA eovarriere ‘enuL

*SOT3TITGedeo TTO pue seb ZO ‘TTO ‘seb YITA SETATTTOeZ JO zequmu euz sMous 9 eTaqe, /Z

(899)

{€8z’'06) 680’TY

(808)

{[s60’T 7°] L418

(899)

{4s9’ZT 30) e18’s

* (80S)

{6ze’z FO] LST’T

(%S)

[20z‘pL FO] zet’te

000 PP) suoL TROD

(889)

(682) 6€T

(869) :

{(4tT ZO) TT

(896)

{[o9T sO) €4

(8Z¢€)

[sz so) 6

(8S)

[v8 30) 9P

Tetattyoea F

-IVIOL

SNOILALILSNI

SWHId ONIUNLOVANNYW

SAILITIIGN TIVWS

SAILITIGN ADVI

511

eu} eAaeY

eyuL ‘AouebSzewe 10 ‘Sutyeed

YOTUA Se

(809) - (809) (0)

€ z x

(899) (8TT) (0)

(A L x

(809) (802) (0)

€ T . x

(%6Z) (#8) (0)

0c € x

Byun Sysuon StyaUuONW

ZT-9 s-¢€ Z-T

AS@T3TTToVg Fo zequmN)

a aTava

(SOF3TTTOeZ ¢)

IWNOILALIUSNI

(S@T3TTTOBZ 99)

ONTUNLOVANNYW

[ST3TTTOVZ ¢)

SAILITIIN ITwws

(S©T3TTTORZ Be)

SAILITIIN Av

{*ezteuuotzsend ey3 zo

SF, zo sesucdsez woxz szep_oze seznStz ebeuuoz try) ‘“se5 uznq 03 At TTQedeo

oud TAVY SOTITTTORZ 30 set UF peumsuce TROD JO suo3 ZO ZequMU TRI03 uodn peseq

ze seseyjuezed uy sebequeozed eut °*1496T ze0eA ou 203 SqSUCH i i) Ut pezeis

‘getouenbezz eAoqe ey3 ut sed Terznzeu Suten eryweace SOTITTTOexZ x0 seyoind

TeoD Jo sucz e7ebexzhbe o uesseidez sezn ebdeuu

(0) ane (ap9) (0) [suoz 997]

x x 06 OLT x SNOILNLILSNI

(88T) ($9) (869) (82) (0) {suoz 499’ZT]

nu 8L6 Loe 8TL’€ vse x SWEId ONTUNLOVANNYA

j if)

(ST) (0) (8z¢) (eve) (0) (suoz ss¢)

€¢ x TOZ + Tet... x SAILITIIN TIvws

(s€) (878) (8€T) (0) {suoz T8z’etz)

0s9 $Z0'6T 9S0‘¢€ x SAZILITIIN ADuvT

80 Tenzov syuzUOW sYUzUOK syau0OKn

i / ON ZT-9 - G-€ t-T

/ é (000 ppe)

[TeOD ZO suo, FO zequmN)

/pl96t ~ GOWER SVD TWNLOW dO NOLiNdiuLsid AONanOaua

f T-a g@Tave

*A3TT Tqedeo

TTO Ue BABY YOTYUA se Foes FO Xoqumu Te303 ey3 wodn peseq exe Seseyujuezed ut sefejueczr08d

euL *AoueSzewe 20 ‘hatwaed ‘dn-32038 JO sesodznd ©u3 203 ATeTOS esn Tenz0¥ 203 poubdtsse

uotzeuStesep eyz st ,sesodznd Tetoedg *POIPOTPUT exeu3 AZTTTqedeo Tro ue pue

ezyeuoT send eusodaqns OF SsucCdsez B YOTUM ZOZ SETITTTORZ SutTumsuco TROo

Sts see Uow FO Suze; UT efesn Tro Tenjoe j0eTIex shu swe A

[S@F3TTTORZ 6)

SNOILOALILSNI

(S®T3TTTORZ pe)

SWIIdZ ONIUNLOVANNYW

(0) [S®T3TTTORZ 9)

x SZILITIIN TIvws

(0) (S@T3tTTOVZ ZT)

x SAILITILN 2uvt

syzuoK

zT-9 S-€

(S®T3tTTOeZ FO zequny)

[*exteuuoctzsend

eu FO OST WO, OF sesucdsex worz peAtzep exe sexnStz eSeuv0z TIv] «tro uznq 03

Aatttaedeo eyz Sutaey setatrTfpoes 38 L96T UT peumsUOD TeOD JO sUOR FO ZOEquMU T2303 OLR

uodn peseq eze seseyjuezed ut sefequeored eyut, *1496T 2¥0A OY ZOZ ‘SYQUOW JO SuUlzeR UT

pezejs ‘setouenbezy esAoge ey3 UT TTO Sbutsn ATTenjoe seTITTTSezZ x0 96T UT peseuornd

Teoo Jo suo3 e7ebezbbe eyz juesezdez sexznbyz ebeuuoz ous * (exyeuuoyzsend ORL

FUMeSUOD TROD) SLT wrod ‘9 UOTZSEeNH O32 SesUCdseZ FO UOTZETTAWOO & ST [-F ETqeL /3

(8€o) (80T) (89) (0) _ [@u0z e¢e)

ese 08 ~ OS x SNOILNLILSNI

(88T) (829) (98) (8€) [suoz 060’¢)

tss vor’t voz TOT SWUId ONTUNLOVANNYW

(89T) (0) - (0) ' (s€T) [suo3z 988)

Ort x x vTT SRILITILN TIVWS

pLe’L Los’z

Sesodindg lepfoeds SujUuOW SyuaUON suauOW

ZTt-9 S-€ t-T

(000 Ppt)

[TeeD FO suo, JO ZequMN)

(%z9) (8Tz) (0) (0) [suo aet‘2t)

SAILITION ASUVT

Jg£96T - ZOVSN TIO T¥NLOW dO NOILNGIULSIA AONAN

T-2 2TaVL

515

*A3tTtqedeo seb e uate se

FO SUOR JO ZOquMU TERIOR OUR 03 L96T UT peUZNG seM TROD YOTYM z0z

SOTITTTOVZ s peseyornd suoj so zequmu ezehexbSe ©U3 FO OTIeX OUR WUesSezdoz

eu3 Pepeey uumToOo euy ur

eurIng SYM TeOD YOTYM Zoz sesodand ey3 zo

43 JO OFRX OyR JuUeserdoz soesoyjuored ut

*000’T 38ez2¥eN 03 pepunoz ozv suo, /L

peddtnbe eze yor

seseyujuer Uy sebejueoz

(802)

(p92 30) eT

(*€2Z)

(46€’S 30) tz6’e

(800T)

(s8€ 30) Gee

(886)

(tez’‘ez FO) zse’zz

SUOL TROD JO #

[LE9GT UF pe

*,8UOL TROD ZO ¥,

UITA SOTITTTORZ TTe JO zequmu TejI03 eY43 03 L96T UT Pp

TTe rox sed uznq 03 peddtnbe SST3TTToOez Jo Tequmu o

sebejueorzed oy3 ‘,S8T3TTTORZ JO #, Pepeoy UUNTOS eu UT

@ S8M TROD YOTtuM 1203 esodin

®AgZ pur yoeg x0 sep uzng 03 pedaynbe

TITTTORZ Tre Aq peseyornd troo

esodiznd Azeae 203 se uzngq 03

*A3tttTqedeo seb ev

(808)

(§ 7°) »

(862)

(99 30) eg

(800T)

(¢ so) ¢

. (826)

(gs€ 3°) ce

Seyatifoed FO F

[296T UF SeTZTT TOR” esoUy, ye peseyoang TeoD

JO suo, Sutpuodsezz0D ey3 pue)] seT3tttoeg

a WTEv.

SNOILNLILSNI

SWHId ONTUNLOVANNYW

SZILITIIN TIvws

SSILITIIN zouvt

516

*Aatttqedeo TTo ue UITAM SseTATTTOesZ TTe Aq peseyornd Teoo zo

' guo3 ZO Zequmu Te303 EU OF L9G6T UT peurnq seM TeOD YoOTYM z0OZ esodznd Azxeae TOJ [TO uznq 03

peddtnhbe eze yoTUA seT3tTtToezs Aq peseyornd suojz zo zequmu ejebexhSe ey3 zo oTzex eyR 3UeSserdex

seseyquezed ut sebejueorzed ey3 ‘,suoL TROD JO #, peEepeeYy uuMTOO oeYR UT

UITM SOTITTTORZ Tre JO zequmU Te}OR OUR OF L9GT UT pourtnqd sem TeOd YOTYM AOZ sesodand oy jo

{Te XOz TTO uaznq 03 peddtnbe seTzZTTToes FO requmu eyR JO OTZeX SYR QUeSexdex soseYyjUeZed UT hi

sobequeozed ey} /,SOTATTTOeT JO #, PEPKYey UUMTOS eYR UT

(802) lees 3°) ves

(879) [060'€ FO) LT6‘T

(800T) [988 3°) 988

(886) [8¥T’ZT FO) 996‘TT

. SUOL TeOD 50 F

"AIT ttTqedeo Tto ue

*000’T 3882eON OF pepuNOZr ere sUO!

(sec) (6 30) 4

(862) [bE 3°) LZ

(800T) [9 30) 9

(876) (ZT 3°] OT

SOTITTTOeA FO #

L96T Ut POeUZNG SEM TeOD YOtym 10; esodana

fs Azeaq pue yore 203 ITO uszng 03 SeaaynBs

(L496T UT SOTITTTOe, esouL ze peseyornd Teo)

3O suoy B5utpuodsezz0D ey} pue) seTIttTtToeds

9 ATaVvL

SNOILNLILSNI

SWHId ONIUNLOVINNWW

SZILITIILGN TIVWs

SAILITIGN IVT

517

THE UNITED ELECTRIC COAL COMPANIES Dx 60

COAL RESERVE DATA

(A) SMOARY

UEC COAL RESERV®S AS OF

____DECEMBER 31, 1969

CUBA, Fulton County, Illinois (Strip) 1,206,260

FIDELITY, Perry County, Illinois (Strip) 18,365,390

BUCKHEART AND NORTH *« Pulton 27,379,963

County, Illinois (Strip)

sgt Fulton ee Peoria Counties, 5,081,691

Illinois (Strip iy

52,033, 50t

UNDEVELOPED OR ISOLATED RESERVES

Illinois Strip Reserves

Industry Field Strip Reserves j " 12,550,457

(McDonough County, Illinois)

Miscellaneous Illinois Strip Reserves 2,059,552

Out-of-State Strip Reserves

Oklahoma Strip Reserves 2,301,872

Colorado Strip Reserves " 12,522,000

é ’ ’

Fidelity Mine Deep Reserves 5,347,246

Round Prairie Field Deep Reserves 44,251,574

(Perry and Washington Counties, I11.)

Vermillion County, Illinois Deep’ 1,795,360

Reserves . ;

; 51,354,180

Total Illinois Reserves 118,037,493

Total All Reserves 132,861, 365

* Source: The United Electric Coal Companies Lands and Reserve Coal

and Depletion Schedule as of December 31, 1969.

ésaa5 - eal r0en, wmower eo ‘Azenen eset sri

@5226 + 0052008) epeaeye ‘hywney samy - Pes wepdon

4148 ~ Say 2900) ovens Ayeneg aang - ploys o1hen oe

43428 - eay2000; OVOUTTTI ‘Aoumeg weatng - poodseay] 2003 oe

Orang ~ Sagaooer SVOCTTIT “SOP sEMED selhngeg 9 YPnOuegEN - PLOT, dezenpEl “

‘ 472g + sassoenr OVOCTTLT ‘Azemen Gente, + PLOT, eeaueD qaseH "

one" 119° co’ tis's w'cin'ov IM ~ BaLIOY ~ TraGs

oo ee ed wer ww rey Se ee eee

_ $061 © peaeyémey - sasaoeuy “ont *VOCNTTT *AounED SOTTTPEEE, - Sheen Lame ~ Ce “On SOTH 1

- 41298 - Bepern - earrey Cov’ ser 'on om ovens SVORTILI ‘Ammen woatng - s20nqypng qaneg -—_—m wo “cl ‘st

Ara0g + Soper + sayrey es 6c vee “a SVOVTILI ‘Aaumep mentRg - sabequonG qasen “on owt o

ee ee] "On SVOPTTTL “Aaunen Aaseg - Aanepta = PIOLs WoETtD

43499 + Soper - earoey Ose one’ at wus o"ons et ee 7: oH

41206 - Sepern - Saz20y Ome vor “ue ory" CVOUTTEL ‘Asenep eenpng ~ 99ND - 6 “On onpH

ae “ar a a a a re a 2 ae

6961 ~ @S61 sadumsmu (€)

6,719.92 1,6, 180 :

ee mM > BALIOWE - ‘TOR

61498 + emj20081 mer KT wor wmourtyo ‘Azenep 9601407

éy209 says0001 coo'res’st = ont ue opmseyen ‘hvenen rae]y - preTs wephon

65296 + onj20001 ours «= Gee oerese PVOWT TIL ‘Aounen Aaseg ~ plots StAeD or

41495 © saq2001 290" v9 er°cot 0"ov! VENT TTT ‘Avunen woatng - joodsenyy 2002 o

6y298 + eap20001 Usv'Ose'et «ot one’G «= sae’ OVORTITE ‘SepRURED seyhnyeg 9 “Pnowcgen ~ pIeTs Aasenpel

| sw ee ee VENT ITE ‘Aawnen dering - PLOT, wore qasen meu

~ geeome'on = orreet’s «= owen OuLMIM + BALIOV + ‘Twaee

% 43496 + Super ~ Sasaey weer wot wer OVOWTTLL ‘eopeERED e]A0E4 | WONTRG = seuErE ~ it ‘on OUTH “

6961 « peneyéuen = sapnewe ' 1s'o1 OVOUT ITE ‘AouneD wOTTTFERE, - Ssoem Lam - G2 ‘on OUTH TH

45296 ~ Sepemn « eapaey ee ee act's SVORTTIT ‘Avene SentRg = SanequENG YIneE ~ (1 *On OUTH “9 Ct ‘et ‘tt .

4y206 ~ Soyer ~ sataey ' co'cee’s tc*see"t wrt OVONTTTE *Apuneg wentng » SAneNRONG qasem = CT ‘om OuTH 19 or

65298 + Sepern « eapaey tos‘ove “aw aren't : OVOUT TTT ‘demon Aaaeg = Attensa = PIOTA WoOTTD

41298 + Sopot + eepaey sov'ooe’it as*tot’s =k 10"T peer tit ‘Aawneg danny ~ Aapyepsd + 11 “on OoTH

45208 + Sepern + sasaey ie «urs OVONNTTE ‘Aaeneg wontng ~ Sar + 6 “on OWN

——— var

corr

= a “Te yen § mE

SPOUTTTL ‘Ayumod worTpMseA = B200K Are - $2 on ou

SVOUTTTL ‘AyunOd UORTRA ~ G2¥eURONE WENOE ~ LT “on ouTH 9 ar ‘tr

STOURTTL ‘AyuMOD UORTRA + GaveUHONE HEION ~ LT ‘on ouTH Tt Yor

SPOUTTTI ‘Ayunod Leased ~ Ayrreptd = preté YouTTD

SHOUTTTT ‘Myuned Lazed ~ Lyrrepyd ~ Tr “on out L9's'9

y 42M ~ GRLVIOEL + SALLoval + TV102

ee ee of

SVOUTTTI ‘Ayuned weTTTEIeA ~ Mys9d014 eyounK

STOUTTTI ‘oopyuned eoySupwown 9 Lised = protd eTsTesd punoy

a —FIOMTTLL "SOpuUNeD GOTIUTUSMA © Ala = PISid oisfead PON

De eee

SrouTTIT *Ayuned Asse + Latteptd « Tr ok ourk

att

me |

EAE

saa

Le°Lee

Biman

109.00

0.00

_ a]

59.00

10,090.58 8,95). 4B, 229,680

- RAR Tay

OO ite! 26 ren earcte

TL‘ 992 aro oorogr’t

ES x rs Fo

Grane - eapyovul ser 06° tus ooron0"t

0n6* ges" tt sirigt’s teesrr’tr

Ound - Peyyoedeesd - maTseY rar Fm TeT

Gyan - Buyvoedsesd - sayy ign’ ose’ tt orgen’e os"oLe’®

C1218 - Puyvosdeosd - sareoy out Or aze ws

Sue ~ Suypeedonad ~ sanyey wees‘ eer ger’e iaeay'*

’ x sei'ceses = mwromt’s tH Ugeee

“ht > he - a war TRF Tw

A = Depew ~ comer Tas’ oe ern “rs

+ GUNS + Sepeml ~ soney Seo’ Siz"@ ser age*t SL°omn's

CMe + Sep ~ senor onesie «= sos rer’s 2s Cat's

re ~ SoH = comer ooa' tod on OK"

Cue ~ Seem ~ seer 7K nt'n wr ele’e SS°9RT OT

unt ~ Sept ~ samen gor’ ort wu or me's

a es, |

990 ‘92’ 50 OO°TLN' TY 9a’ teg’ Le gmaesysu dTalg - TVLOL arvic

‘ Als mitmots = at'on9 avon — _— '

STS “Wt Os “wot yee: 1. "ined PrOTd qaeounord

" wt y eons - we qanes

OVONTTTT ‘Ayano kasog = Ayrrepys = tr *on oupy

Ayom, wor ‘Aywmed euprcoll = 1z *on cory

Cs‘ exz tes Sreet «= Sawogein ‘hymn cup.ded = ROD OIF © OT *CS CT

TSE“gu9’ oz Grure ss ztofor CPUTITT “Symes wor = yaverpexs = ft es mT!

os" t26"t wre Pet eyouptt *Ayeues Lat + VICI - PTORE YOrTED

Gin" gah lz Cormree or oe’ OPOTTTI ‘Ayrasy Ara0g = Averorrd © Tr °ed Coys

097°622"s ester orse's SHOBETE *Aymoy weaTHd = LYBO = 6 “OL CHR

T96T ‘IS ATNF JO SV

TVOO ZAUGSAY F SANVI

SAINVdMOO ‘TVOO OLULOGTA GALINN AHL

MINE _NO. 9

Mined Out

Estimated Adjustment

Yield Loss

New Lands

Net Change

MINE NO. 11

Mined Out

Estimate Change

eeeeereoeoeoeeeeeeeeeeeee

eeeeerereereeeeeeeeeeee

eeeereee eee eeeeeeeeeee

eereeeeeeeereeee eee eeee

eeerereeeeeeeeeeeee

Yield Gain, Present Pit Ory ee ae ee

New Lands

Net Change

cLIncy PIT.

Mined Out

Yield Gain

Estimated Adjustment

Net Change

MINE NO. 17 (SOUTH)

Mined Out

Estimated Adjustment

Yield Gein

New Leases

Net Change

Ceeeersesbeeeesece

SPeeeCeeGeeeeeeeeeeeeee

eeereeeeeeeeeoeeeeeeee

ePeeeeeeeeeeeeeeeeeeee

Cee eeeereeeeeeeeenee?Ed

Seer eeeeeeeeeseeeeeese

(805 , 608)

(91, 200)

(55,538)

(944,619)

_ (1,146,041)

(460,046)

111,7%4

2,059,337

564,984

(687,909)

*29,585

17,741

(640,583)

(957,832)

— 22.023.

(928,809)

(1, 304,530)

508 , 356

142,638

(653,536)

MINE NO. 27

Mined Out

Estimated Adjustment

Yield Loss

Net Change

COP eeeeeeeeeee

nd hee ee

£685,932)

(262,976)

(975,000)

MINE_NO. 9

Mined Out

Estimated Adjustment

Yield Loss

New Lands

Estimated Change

Yield Change

Net Change

MINE NO, 12

Mined Out

Estimated Adjustment

Yield Gain

New Lands

Net Change

Mined Out -

Estimated Adjustment

Yield Gain

Net Change

MINE _NO._17_ (SOUTH)

Mined Out .

Estimated Adjustment

Yield Gein

New Leases

Net Change

eeeeeeeeeeeeeseeeeeee

eeeeeeeeeeeeeeeeeeeee

oeeeeeeeeeeeeeeeeeeee

Prrrrrrrrrrrrrrr rir)

eeeeeeeeeeeeeeeeeeeee

‘

eeeeseeeeeeeeeeeeeeee

eeeeeeeeeeeeeeeeeeeee

eeeereeeeereeeeeeeteaee

eeereeeeeseeeeeeeeeee

eeeeteeeeeeeeeeeeeeee

eeeeeeeeeeeeeeeeeeeee

(738,055).

( 7,919)

( 28,084)

287,505

(744,849)

(337,373)

(1,568,775)

(1,709,357)

( 91,624)

$7,522

55 348,816.

(1,394,644)

(134,736)

{_3.88))

(140,617)

(872,715)

( 48,891)

—42,122.

(878,427)

(1,129,631)

372,330

74,487

( 446,427)

MINE NO. 27

Mined Out

Estimated Adjustment

Yield Loss

Net Change

547

eee eee eee ee ee eeee

(675,217)

( 56,411)

( 76,673)

(808 , 301)

548

Changes in Strip Reserve Tonnage During 1967

Mined Ouiteccccccccccccccecccececesesece Ca

Estimated AGJuStMERE. «+s eeeeeeeereecere

Yield LOSS ccccccccccccesesseceseseseese (2,294)

New LandSeccoscccesceececssesesssesesese 223,403

Net CHANFScccccccecesevssesesesesesese® (772,059)

nu .

mined Out .cecce ee eer eeeeen seeeeeerens eee (2,031,157).

Estimated Adjustment.... eeeecece cn scdes (29,010)

Yield GaiMecceccccceccessescesesesssese 104,590

New LANdSescccccececesecesesesseseseese 60,

Net CThangesceeceveccees seoccesesecceseee (1,895,373)

17 (North) a

Mined Dbeccecccccccerecessesseseseese® (987,301)

Estimated Adjustiment..ecccessccecccecce (20,895)

Yield Gains cccccecccecescesesesesesesee 15,024

Lease Expired (Floyd Shelby et al)..... (53,635)

War Chemgessccrccccccccccccccccccececee (2,086,807)

17 (South)

Mimed Out. ccccccccccccsccesesesseseses (916,633)

Estimated Adjustment... cscecsececeseves 71,608

Yield GeiMecccceccccccccseresesessesese 6b , 91s

Net Changeececccccecsesecseeessssessses (780,115)

Mined Dube cccccccesecececssesesseseseee (834,021

Estimated Adjustment....cccececeecccvce (42,839

Yield LOSS cee ecccccesseeesecsseesseseee 132,307

Net Change...ccccecesceserescecesecesse (1,009,167)

BUFFALO CREEK NO. 2

Reserves on January l, WH racecccceces 1 MEF

In Process of being SOld...sssseeesseee 1,166,570

. - ¥

MEMO: Changes in Deep Reserve Tonnage During 1967

BUFFALO CREEK NO. 2

Reserves on January 1, 1967.... 3,223,378

In Process of being SOld..crcce (3,223,379

ROUND PRAIRIE FIELD

Estimate Adjustment...... eocese (164,226)

New Bam eccccccccccegHesevcets 869,406

Net CNANGCs oe ceececsccecccesece 705,180

ROUND PRAIRIE FIELD (Isolated).)\

Estimate Adjus‘*ment.. ini eeeee (100,180)

Net CHANBSccccecccceccccecsecce (100,180)

550

MEMO: Changes in Strip Reserve Tonnage During 1966

MINE NO. 9

Mined Outecccvcccccccccccsesesssesceses (931,826)

Estimate Adjustment. accccccccesecsceces 23,971

Yield LosSeccccccccccccccsssesesessesse®

New LamdSeccccccccecescccssesessses see

Net Changeccccccceccscessesessssorsses®

MINE WO. 11

Mined Qut.cccccccccsccececcssssessesees ‘(2,080,251

Estimate Adjustment. .cccceccecessessccs (647,252

Yield Gainmeccecccccessesesescesescceses 94.5 347

Hew LandSeccccccecccescesessesesseseseee 1,351,2h5

Net Changecccccccceceseses eeeveeeeeseoe® (1,281,920)

MINE NO. 17 (Worth)

Mined Oubcccccccceccccecscsssoseossoess (2,033,621)

Estimate Adjustments. ccccccsccecccseccs ry

Yield Gaineccccccccccscesecsssssossese® 97,609

Net CHANGSccocccecccccoc see cooocooscors (1,595,175)

MINE WO. 17 (South)

New TANdSccccccccescccesecesesessesseee

Met Changeccccceccccesssovessessssoses®

MINE NO. 27

Mined Date ccccccccccccesesesescsosereee

Yield LOSScceccceccesesesssssesesseseee

Net Changes.ccccccecccescssssesessssors

BUFFALO CREEK NO. 2 _

Tease ExpiLred..ccccccececsccesesscseses

Net Changececcccccccsecsccvessosesseseoe:

551

MEMO: Changes in Deep Reserve Tonnage During 1966

BUFFALO CREEK NO. 2

Lease Not Renewed..cecccccvecccccccsece (205,479)

Net GHOMEOc cc ccccccecccccvccccocecccese (105,479)

MDs

MINS XO. 9

XB XO. 11

552

Sa ee 8 é doce? ~ 1

Chovntes fa $oriM Reserve Tommags Daring 1965

stancd CnrVececccceccenecvesersosssesreeee (840,705)

Rakin n ss oo ee en deme ae oe

Sstexcss S Mu isveo ees eeeeeseeseeeee eee ?

Viiold LOSS eececceseecesseesseseseseseeee (66,549)

new Lice cccccccescccccccecssceseserese 4,113, +

Not CHANGWeccecccccvcvscesevessecs eesece 3,261,691

‘Hined Bic cucixwceecnees ractieeerensasec (2,825,255)

Sstinave AGFUTCACAGs ec cccecccecececccere (591,629)

Yiole LOSS cccccecreseseesesesersesssesere (285,576)

Xew LNCS oceccccccsccscsesessesessessees 9,278

Xet Changossccecccecccccccccccvcsccecccs (2,693,182)

- XE MO. 17 (mores)

yinsd CEdecccccccccccccesceseseseceseres (1,992,089)

Ssti=ate AGJUSTRIWTVe ccc ccerccccccscccece (251,908)

vicle Gainecscceccosccccccessccssseseees 152,293

yew LiMASecccccccsesesscssssesesesssese® 355,407

Yow ThaNZSecrcceccccessescessecsesssesese (1,736,297)

XIKS NO. 17 (South)

MIKE NO. 25

Bae LamBorccccecccsccccccccccccoscooese 1,775,350

Net ChanZececcccccosesccscsesessesssese® 1,775,380

Mincd eis. <ccuscaivelsaveuseussataven (20,163)

Estimate AGJUSTRONE cee cececccccsccscscce : 91:8

Net CHENG cccccecccccscessssosesescseses (19,215)

Mincd Out-coccccccccccccccsccserccvorees, (670,k29

yaole LOS ecceccccecevesesceseresesreeee (- 9361

Nev LOMEDecceccvaceccssssecseces eeeeeere 1,439,634

het CHaNGrececccccvcesecessccscessessees 753,844

553

Chances in Strip Reserve Tonnaze During 1965 (cont*)

» °

NORTH CANTON FIELD

Leased to TTUSM-TLGSP ec cwecocwoesssecvce (10,177,773)

leased arom TIUAX~TT9GPe+eerseeeeeeeees 401,765 _

Net GUBNBGES Cee cect ee tcccecceccicsvcoss (6,162,988)

HAYDEN FIELD, COLORADO

New Lands... Seeeeeeeeseseceseeesesesece 12,522,000

Net Se ets s eect caceboceosceny 12,522,000

Changes in Deep Reserve Tonnage During 1965

BUFFALO CREEK NO. 2

Lease not TONSWOM . cccccccccccccccccecece L64,6040

Net GANESe ca ccevesccnsccavcosscconvecces (464,640)

ROUND PRAIRIE FIELD ~

war New LADNER. ce vccccccccevecccceccccscccece 6

Estimate AGjustment...cccccccccccccccece ———

Net CHANZC reer eccccercnscccccccccccccece 6,169,175

554

MEMO: Changes in strip Reserve Tonnage from 8/1/64 to 12/31/64

MINE NO. 9

Mined Out.ccccceccvcccccceccesccasesesese (407,422)

Estimate Adjustmentececcccccecevecccesecs

Yield Gaineccccccscccsecevesccescsosseses

- Net CHhANQScccccscccccevcccccscsvcsecesece.

MINE NO. 11 :

Mined Oubecccccccccvccescccscceseceecseess erage

Estimate Adjustment. ccccccvccccevesscsoce (15,364

Yield Gainecccccccccccccccccccscccecccese 5,000

New LandSecccecccccccceccssccevecseevessese >5 22h ——

MINE NO. 17 (North)

Mined Oubeccccccccccccscncccecesceveceses tye

Estimate Adjustment. ceccccccevccvecseccece

Yield Gainececcccccvccvccscccsssseseseese ’

New LandBesescecccccccccceeseseessesesees J

122

Net Changers ocsvccscceqgcecescesesvveceecs (819,847)

MINE NO. 25

Mined Outecccceces eeceesceeeeeee Seeeeeeeeee !

. Estimate Adjustment..cccccccveccccscceces

Net Chang@ceccccccccccscccsevecsesessesees

MINE NO. 27

Mined Oubeccccescscvccccccveceseecessesese

Yield TOSBeccccccesvecesccscsevesesseeses®

New TANS a ccccccccccccscececercessceesece r

Net Changeccccrvecccccccceseesescesesesed (75,060)

—

x38 E

388 §

————————— _ ——

Changes in Deep Reserve from § to 12

ROUND PRAIRIE FIELD

sheet Bills sisecbesisevecccedocdccecdocsce 232,320

Net Changecesscccssececseseccvsssssvssenes 232,320

555

MEMOt Changes in Strip Reserve Tonnage During Fiscal Year 1964

Mined Qutcccccccccccccccccccscecsesscceces (840,871)

Yield TLOBSeccccdccccscececccscesesecesses 23,569

Estimate Adjustmenteccccccccccecccsccscce Bee

Measurement Adjustmentececccccccccccccvcs

NOW LamdSeccecccccccccceccccccecccccesese ie —

Reactivated Reservesecccccccccccccsecceses 35h 000

Net Changers rcecceccccccsccccsecccsevece C 71 )

MINE WO. 11 :

Mined Outbeccece cocccececce seeseeeeeeeeesee (2,892,040

33,098

sp Yisld LeSSeccccccctoccccccccccccceccccece >

Estimate Adjustment. cos cceccccccccccccces (67,591

40,774

Measurement Adjustment.cccccccccscccccece

NOW Landsccceccccccccescccccesssceeceseee 1,403,971 —

Net Changdceccocescccccccccccccccccccccecs C1547, 984)

MINE WO. 17 (worth)

Mined GiMinitis vane dnassncllooneacnacnacatiiiie (2,848,95u)

Yield GaiNecceccccecces eeeeeeecee seseeceeeee@ 98,212

Estimate AdJustmanteccccccccceccssccssece 207, 5h4

New LandSecccccccccccccvecccccccecessesss 59k, 766 gr

* Wet ChANGSec cc cccccececcccccecscscosecceece (948,432)

MINE NO. 17 (South)

NOW LandBeccecccccccsccccesccccccecccsese 1,113,200 ——

Met Changeec ccc cccccescccccccscescscsesccsses 1,113,200

Wet Change Mine #17 worth & South (28668

MINE NO. 25

Mined Oubeccccccccccccsccccescccccecccces (263,937

Estimate Adjustmentececccsccccccccccecece 7 {2 240k

000 ——

New TANS cece geccccccccccosccscceccccecs 16

Net Changeeee. Seeceececeseseeseseseeeseseseese “ (250, 341) )

556

Changes in Strip Reserve Tonnage (cont ta)

MINE NO. 27

Mined Oubeccccccceccceccccescscsccsesesese Lom

52,060) .

Yield LOBBSecccccccccccccesecccesseecesees®

Yield GCaineecscervece eeeeeeeeeceeeeseseseeeeee

NOW LamdScccccccccccccccecesecsecesesseeee 1 149,232 —

Net Change@ecescccevcccccessccescscscscsecsel( 386,771 )

NORTH CANTON FIELD

NeW TandSeccccccccscsccsvccsesecssssseses® 996 600 —

INDUSTRY FIELD :

ee ne oe eapneeadpens tke 600 000

Net CHANZSseeecccccccccerccccsccssssescece 300,000

oranges in Deep Resorve Tonnages During Fiscal year 196k

ROUND PRAIRIE FIELD

NOW LandSeccccccccccccccesesesccccsssceees 13,293,082

Net Changeccscccccccccvescccsecccsscsecsseses 13,293,081

sty 557

MEMO: Changes in Strip Reserve Tonnage During Fiscal year 1963

MINE NO. 9

Mined. seocccsveccccevccccsscccsscvcccs ’

Yheld Losseccsccces cocccccccescccccoes

Yield GOINsrccccsecccesvocersscccccces

Net GUNG one 6¢ casks ced Sid céeceedicdd

- MINE WO, 11

Wi iivsctaticnntissccnscsvuscecsial

New BAN k sb cede tcccciscscecccecedése

Yield WROG hs ci docks ped docccnsenseceses

: Yield Gl Mecccccccccccccccccccecsscees

Estimate Adjus

Adjustment in Measurementecccccccccccce .

Net Changeccocccccccccecccccccccccs see

MINE NO. 17 (North)

Tine eb siccecdossiccecsccsncdecses

New TandBecccccccccccccccccccccescocce

Yield GEEMedcccccccccccccccccceéeccese

Estimate Adjustment. o.cccccccccccccces

Net Changes ccccevccsccccecs eeocccoesece

MINE NO. 17 (South) ... f

; 4

_MINE NO. 27

Now Lands..ccceces Ce srecececccscoccoes

Net GREMNBOe co cccccccccccccccceceseooce

Net Change Mine #17 North & South

Minedeecccccccecccccece Seeeeesoeseseeee

Yield TOSS eccccccccscccecccscsescesece

Net CHANZCc ce cevcessscccccceccccccsece

Mintdeccccccccccccccescccececcccccccce

New TANS ce cccccccccccccscccccceccceoce

* yield TABS ccccccccsccvccccccsccccccecs

Estimate Adjustment oo. -secccccsccesee

Net CHANGSececccccesecsesecseveccceces

558

{

Changes in Strip Reserve Tonnage Cont'd

"NORTH CANTON FIELD

New LANES. ce cccccccccccccccccccecccece 4,761,855

960

Estimate Adjustmenteescccccccssecsccecce

Net Chang@ccccccccccccccccccccecsesscce 4,831,815

INDUSTRY FIBID

NeW Lands. cccccccccccccccescsececesceos

Net Changeeccccccccccccccccccccscccseces

251,4h0

p24

251,440

—<—— ==

Changes in Deep Reserve Tonnages During Fiscal year 1963

BUFFALO CREEK NO. 2

Lease DPOppeds oecccccececceccvccsccece

Net ChANgOcecccvccvcccccescccscceseses

ROUND PRAIRIE FIELD

Change to Round Prairie Deep

Coal = Teolatedececccccccccccccecccccs

Net GRANBB0 cc ccc cccccccecceccececotéoes

(290,400)

(545,981)

(SUS,982)

559

NEMO: Changes in Strip Reserve Fiscal

MINE WHO. 2

ne ream = —_ er

Yield Gain-~ ate 47,622

Net Change-- C ' 7,

~~ a

MINS NO. 11

Mined. en -e- ee 1,663,957?

Yield Lose- ?,

Tield Gain- Bh, 389

Estimate Adjusimant- h,298

Mined : 1,220,592

Haw Lands-- 55.30 ne

Yield loss-~ -- 2,

Yield Gain-- 27,500

Estimate Adjustment - aes

Net Change-—- . .

MINS 0.17 (South

Wew Lands-~- 2,888,892 ——

Wet Change--- 2,000,898

Wet Chehge Mine No. 17 North & South 2,225,264

MDB MO. 25

Estimite adjustacat— he

Yield Loss-- soe n 618

Estimate Adjustaent-—- ~ 68,053

Yield Gain- weon »Sbk

#ew Lande- 632,179 ——

Rot Change-

° —

MINE KO. 27

‘Hinod- swewe= = 707, SHO

¥ ield Gain--~.......... “= 37,776

Wev Lands--.- 138,000 ——

560

Changes in Strip Reserve ‘Tonnage (Cont'd)

NORTH CARTON FISID

Wew Lands-~

Cancelled - C. W. Dules------ 691,252

Wet Change ;

561 \

MEO: Changes in Strip Rosexve Tonn7ge ‘Daring Fiscal year 1961

INDUSTRY FIELD

~— N Tanda

—==- =— —<———=

MSKO: Chenzos in Deop Reserve Toraaze During Fiscal year 1961

—_ 1,974,720

MMO: Changes in Strip Reserve Tonnage During Fiscal year 1960

MINE NO. 9

Estimate adjustment-

een eeere ee eere

MIME NO. 22 (CLICK)

Yield Gain--~

Estinate Adjustment.

Net Change--

MINE 0. 17

Sstinate Adjustmant-

Yield Loss-----

2,553,600

563

MEMO: Changes in Deep Reserve Tonnage During Fiseal year 1960

ROUND PRAIRIE FIELD boca

ew Lands 1,290,700

MIKE WO. 21

d------ 6,889,103

jus: Gaaneea Sa Strip Resorve Toanaye Parirg Fig2a) Year 1959

MANE KO. ?

ot w---= 8L7,83.

26,923

_ 2b, 263

— 31436

as 605, ise —_

MIRE MO. 21 (CINCH) -

ii mee 1,320,659

Estiaate Corroc tlon-+-<--+-se<-—— ees = 1pSTR

n= #g097,06r-YIv >

565,

LEW: Choy28 in Ceop Roserve Tomuge faveine, Piccel Year 2959

BUFFALO CROEKX BING ,J2.--+-~-- -

Leas2 Bx lvad------=- + eee ae eens owe weet eros: mEs EE? wEe-eewee 391 2459

Estdaate Correstion---- .

T2b CHA {0—wner reenter ee eni eee 207,312

MINS g2)

— Transirorced fron sino #19 a Ret erve-~—»»— 1 101, 324

SOU PRAXRIE FISD

ou Lamdis-«- 20,962, 3h2

SALE FORK FIELD ;

eu Lanis- 691,152

NEMO: Changes in Reserve Tonnage During Fiscal year 3956

we 2 snod-——= ~ TIL =6ES

Estimate Correction . 207

eS See

RINE WO. 22 2

Quit claim $ acres to Sacred Heart

Catholie Church--

union Colliery Purchass b,h76 bib

Re-estimate of adjacent property to

the Union Collieries purchase-~--~-~- os 1,323,322 :

an nwnnenen= 59755626

Estimate Correction

Yield Loss

New Lands~

Net Change-

MINE WO. 19

Transferred frea doop reserves ins #21

Yield Gain

Net Change

KINE WO. 25

Estimate Correction

Yield Loss-

Het Change

GLASFORD-BANNER FIELD

“flew Lands

BUFFALO CREEK

New

MINE £21

567

Changes in Reserve Tonnage (Cont'd)

LEASE TO UNION COLLEERY (Inactive Peep)

Ieasa discontinued = Included in Mine gil

trip Reserves 883,08)

DEEP COAL RESERVES - i083 NO, 11 ; :

daicn Colliery Purchase- ~-~-5,11,180

DEEP COAL RESERVE ~ BUFFALO CREEK 2 (Inactive peep)

New Lands only, 37 1,209

) POSSIBLE ACQUISITIONS

THE UNITED ELECTRIC COAL COMPANIES

Possible Acquisitions

Mine #9 _

Fulton County, Illinois

Possible - Possible

Acres Coal Acres ' Tons " Remarks

———_

inge Tracts 308 50 300,000 Acquisition

Doubtful.

in Islands

—_—-——

300,000

and is bounded by the Ci of

6 coals on the west and south,

companies.

569

THE UNITED ELECTRIC COAL COMPANIES

Possible Acquisitions

Pidelity - Mine #11

Perry County, Illinois

Northwest Field

Walker

Fringe Tracts

Total

Kathleen or Southwest Area

Harsha 160,000

80,000

500,000

300,000

1,040,000

Mine was started in 1929. Land acquisition in 1926, and only hard to

buy reserves remain. Mine is bounded on the north mined out ground,

on the east by Du Quoin and old works, south by old works and cropline

of No. 6 coal, on the west by cropline and cutout several miles wide,

west of which the coal has been removed. As far as is known there is

= — coal in the No. 6 or any other vein, deep or strip, that can

THE UNITED ELECTRIC COAL COMPANIES

Possible Acquisitions “

Buckheart - Mine #17

Fulton County, Illinois

Possible Possible

Coal Acres Tons Remarks

500,000 In Estate -

Cannot Buy at

Present ‘

500,000

1,000,000

Extremely doubt-

ful

The mine has operated since 1937. Bounded om the north by old works,

unminable coal and cutout of coal, on the east by the cropl of

No. 5 coal, south by old works and end of coal field, on the

west by large cutout and cropline of No. 5 coal. .

671

THE UNITED ELECTRIC COAL COMPANIES

Possible Acquisitions

Banner - Mine #27

Peoria & Fulton Counties, Illinois

Possible Possible

Coal Acres Tons Remarks

30 100,000 Not drilled,

Mine No. 27 lies in the-river bottom and is surrounded by natural

boundaries. North by a range of hills containing little coal

recoverable by stripping or underground mining, east a narrow

river bottom and levee, south by the Illinois River west by

Rice Lake. 462 acres north and northeast of the field has been

drilled and dropped. ;

*sXel[Tea ut ¢ *ON ZO

ZunOwe [Tews e sn{d ‘pezeseuTTep useeq sey yoTymM jo TTe

Atteotzoead ‘TeoD 9 “ON OF PSITWIT ST PIeTA *pezoedxe

eae ‘Aue jt ‘S®AreSeX TeUCTATppe JO suoR 900‘00S

uey3 ssetT 3nq ‘esutT{tdoz> ey3 BbutuTofpe suzez [er9Ae8

Ilt2p pue uotado Aew om ‘peuedo st pretz eu ueyp

uojueD 43I0N

suotitstnboy etqtssog

SZINVdWOD TIWOD DINLOATA GALINN AHL

OL/T/E

- seozy e6uyt3zd

THE UNITED ELECTRIC COAL COMPANIES

573

Possible Reserve Acquisitions at Existing Mines

3/1/70.

Reserves

Dec. 31, 1969

1,206,260

27,379,963

5,081,691

18,365,390

52,033,304

Potential Acquisitions

Tons of Coal

March 1, 1970

300,000

1,500,000

100,000

1,790,000

3,690,000

574

11. Explanation of Above Table

A. Cuba Mine #9 - Fulton County, Illinois

Possible | Possible

Name Acres Coal Acres Tons Remarks

Fringe Tracts 308 300,000 Acquisition

Doubtful. Coal

in Islands.

Total 308 $0 300,000

This mine has operated over 40 years, and is bounded by the City of

Cuba, outcrop of the No. 5 and No. 6 coals on the west and south,

north and east by old works of other companies.

B. Buckheart Mine #17 - Fulton County, Illinois

Possible Possible

Coal Acres Tons Remarks

‘ In Estate. Cannot

75 500,000 Buy at Present.

Extremely doubt-

80 $00,000 ful.

155 1,000,000

The mine has operated ‘since 1937. Bounded on the north by old works,

unminable coal and cutout of coal, on the east by the cropline of

No. 5 coal, south by old works and end of coal field, and on the

west by large cutout and cropline of No. 5 coal.

North Canton.

Pringe Areas - When the field is opened, we may option and drill

several farms adjoining the cropline, but less than

500,000 tons of additional reserves, if any, are

ted. Pield is limited to No. 6 coal, practically

all of which has been delineated, plus a small amount

of No. 5 in valleys.

575

Banner Mine #27 - Peoria & Pulton Counties, Illinois

Possible Possible

Acres Coal Acres Tons R ks

———-

30 30 100,000 Not drilled.

30 30 100,000

Mine No. 27 lies in the river bottom and is surrounded by natural

boundaries. North by a range of hills containing little coal

recoverable by stripping or underground mining, east by a narrow

river bottom and levee, south by the Illinois River and west by

Rice Lake. 462 acres north and northeast of the field has been

drilled and dropped.

576

D. Pidelity Mine #11 - Perry County, Illinois

Possible Possible

Name Acres Coal Acres Tons Remarks

Northwest Field

: Less than

Walker 120 60 500,000 Negotiating

Fringe Tracts - = 250,000 Negotiating

Total 120 60 Less than

750,000

Kathleen or Southwest Area

Harsha . 40 20 160,000 Cannot Acquire

to Date

Eisenhauer 20 10 80,000 Negotiating

“ &

Sutter 80 60 500,000 Negotiating

Pringe Tracts - - 300,000 Negotiating

Total 140 90 1,040,000

Mine was started in 1929. Land acquisition in 1926, and only hard to

buy reserves remain. Mine is bounded on the north by mined out ground,

on the east by Du Quoin and old works, south by old works and cropline

of No. 6 coal, on the west by cropline and cutout several miles wide,

west of which the coal has been removed. As far as is known there is

no — coal in the No. 6 or any other vein, deep or strip, that can

be added.

3/1/70

Source:

Cae 2 Sane }

Company

Peabody Coal Company

Humble Oil Company

Island Creek Coal Company

Consolidation Coal Company

Old Ben Coal Corporation

Ayrshire Collieries Corp.

Bell & Zoller Coal Company

Freeman Coal Mining Corp.

Pittsburg & Midway Coal Mining Co.

Southwestern Illinois Coal Corp.

The United Electric Coal Companies

Sahara Coal Company, Inc.

Morris Brothers Company

Venedy Coal Company, Inc.

Webster County Coal Corp.

Green Coal Compa

Gibraltar Coal Corporation

Rialto Coal Company, Inc.

Pyro Mining Company ~

Black Tam Mining Company

Kirkpatrick Mining Company

Blue Bird Coal Company

R. S. & K. Coal Corporation

Russell Badgett, Jr. Coal Co.

Weirs Creek Company

Wright Coal Conipany

Belle Valley Coal Company, Inc.

Burge Coal Company, Inc.

V-Day Coal Company

Sherwood-Templeton Coal Co., Inc.

Harrisburg Coal Company

Barbara Kay Coal, Inc.

Parton Coal Company, Inc.

Decola Coal Company

Weskol Mining Company

B B Mining Company

Houston Coal Company

TOTAL

* Source:

Form 250, Subpoena Questionnaire

3,250,000, 000*

of 5,000 tons

Kennecott Copper Corporation, and stipulated testimco>y

of George H. Shipley.

** Less than .01 percent.

Tons.

780,898,842

162,878,000

$63,640,000

796,000,000

767,168,071

550,000,000

483,687,408

278,205,000

170,800,000

121,851,616

90,000,000

32,000,000

27,300,000

25,000,000

20,000,000

19,091,904

13,200,000

6,500,000

6,000,000

5,116,000

2,792,500

. 2,000,000

1,200,000

1,140,000

1,097,712

550,000

Percentagc

of Total

Tons Shown

30.05%

25.83

9.24

7.66

6.33

6.10

4.37

3.84

2.21

1.36

272

Letter of February 19, 1968 from Humble Oil &

Refining Company to Department of Justice a assumed |

recovery acre. See also Respondent’

Exhibit No. 184 A-F received in evidence in Federal

Trade Commission Docket 8765, in the matter of

~ a*

TYPES OP COAL RESERVES EELD BY LISTED COMPANIES* IN

ILLINOIS, INDIANA AND WESTERN KENTUCKY - 1968

Dedicated to Other

Existing Mines Reserves Total

Strip 1,140,661,140 646,062,584 1, 786,723,724

‘Deep 1,132,526,758 6,412,353,571 7,544,880, 329

~~ 2,273,187,898 7,058,416,155 9,331,604,053

# See Defendants" Exhibit . ‘Tonnages for Hamble Oil

Company {(3,250,000,000) not included.

SOURCE: Form 250, Subpoena Questionnaire.

REFERENCE: Report of Paul Weir Company, Weir Deposition

Exhibit 2, pp. 23-24.

WISCONSIN ELECTRIC POWER COMPANY

MILWAUKEE, WISCONSIN $3201

- May 21, 1968

Chicago, Illinois

Re: United States v. General cs

. Corporation et al., Civil Action

No. 67 c 1632 (N.D. Tl.)

60-0-37-920

Dear Mr. Cusack:

This is in reply to your letter of April 9 addressed to

Mr. C. F. John requesting information in regard to the above

referenced civil action.

The information requested in paragraphs 1 and 2 of your

letter is detailed in Tables I and II attached. All coal

This coal was consumed approximately from mid-April of

year in which it was delivered to mid-April of the follow-

year. Coal purchased for use at our lakeside Power Plant

same years was consumed during the calendar year in

which it was purchased. The footnotes of Tables I and II

he variance in the period coal was purchased and

In response to your paragraph 3, during the referenced.

581

Mr. John T, Cusack - Page 2, oe: 5/21/1968,

when supplying 230,000 Ibs. per hour of steam for our heating

utility. The footnotes to Table III explain the seasonal

usage of gas and oil and the portion of each used for steam

production at this plant.

In response to pa ph 4, no facilities were available

for generating Slnoteieity by nuclear energy through the years

1964 through 1967.

Facilities for generating electricity from other sources

&s requested in paragraph 5 are limited to hydroelectric and

diesel plants of Wisconsin Michigan Power » & wholly

owned subsidiary of Wisconsin Electric Power . The

information which you requested regarding these facilities

is given in Table Iv attached.

Data in response to paragraph 6 of your letter are not

available.

You will note from the several documents attached that

the majority of our coal is derived from mines in Illinois

and western Kentucky. We believe that the acquisition by

General Dynamics Corporation of the United Electric Coal

Companies made it sible for the latter companies to have

available financial resources for the development of mining

properties and to increase the availability of coal sources

from these regions.

a You may wish to correct your records to indicate that

Mr. C, F. John retired as Vice President in Charge of Power

on December 31, 1965.

_. Very truly yours,

582

DEFENDANT'S EXHIBIT 67

COST FOR GAS FUEL VS. COAL FUEL

FOR PEKIN BOILER HOUSE

During 1967, natural gas was used in the plant for

various process uses while coal was used exclusively in

the boiler house.

- To determine the effect of burning all gas in the boiler

house instead of coal, data from monthly boiler efficiency

calculations was taken. The total heat required in coal

fuel during grind and no grind periods and the average

boiler efficiency was tabulated. This heat was converted

into equivalent gas heat on the basis of gas boilers

operating at 83% efficiency.

The increased amount of gas used on the boilers is all

used at the lowest contract rate. There is no separate

demand charge for gas, any demand rate consideration

is included in the contract rates.

The following data summarizes the above calculations

for each month during 1967.

Cost of gas fuel for boilers to supply an

i amount of heat as from coal for

grind, and no grind) $2,036,800 per year

Actual cost of coal burned in boiler house

during year 1967 (grind and no grind) $1,191,909 per year

house on gas instead of coal (based on

incremental gas rate, grind and no grind) $ 844,891 per year

DEF 2/12/68

583

COMPANY LETTER

Moffet Technical Center

Argo, Illinois

February 13, 1968

TO: R. Meadowcroft

FROM: D. F. Franzen

SUBJECT: Gas Firing In Boiler Houses at Argo and

Pekin

The Purchasing Department and the Pekin Plant have

assured me, through their contacts with the gas com-

panies, that sufficient gas is available to convert the

steam generating facilities at Argo and Pekin from burn-

ing coal to gas.

The additional cost of fuel to operate the boiler houses

on gas instead of coal, based on incremental gas cost

and for the grind and no grind period of 1967 is

Argo, $984,000 per year

Pekin, $845,000 per year

DFF :pld

584

COMPANY LETTER

Moffet Technical Center

ra Argo, Illinois

February 23, 1968

TO: R. Meadowcroft

FROM: D. F. Franzen

FILE: Air Pollution

SUBJECT: All Gas Firing for Boilers, Argo and Pekin

In my letter of February 23 on this subject, I should

have included the additional expense of about $50,000 per

boiler for combustion controls at both the Argo and

Pekin Plants.

Total Cost of

Combustion Control

Pekin—Boilers “A”, “B”, and “C” at $50,000 $150,000

Argo—Boilers 1, 2, and 3 at $50,000 150,000

DFF:pld

585

COMPANY LETTER

eee ee Technical Center

Argo, Illinois

February 23, 1968

TO: R. Meadowcroft

FROM: _ D.F. Franzen

FILE: Air Pollution

SUBJECT: Gas Vs. Coal for Entire Pekin Boiler House

My letter to you, dated February 13, 1968, indicated the

additional cost that would have been entai:e:i for the year

1967, if the Pekin Plant had burned all gas instead of

coal was $845,000 per year.

Estimated operating savings which would be achieved if

all coal burning were eliminated are:

Labor-coal and ash handling $ 85,000 per year

Maintenance on coal unloading and conveying,

coal bunkers, scales, feeders, pulverizers,

stokers and ash handling equipment. 60,000

Power used by pulverizers, stokers and other

coal and ash handling equipment 38,000

Fly ash and cinder disposal 20,000

Sluice water for ash system 5,000

Total direct savings $208,000 per year

It may be necessary to install additional

dust facilities on each of

Boilers “A” and “B” and “C” if we were to

continue to burn coal. This total cost is

roughly estimated to cost about $650,000.

Potential operating savings by not having

to install this equipment based on 5%

maintenance and 5% depreciation is 65,000 per year

It should be noted that the above dust collecting facilities

will not eliminate SO, problems in the flue gas and at

586

some time in the future, additional expenditures may be

involved.

Additional intangible items resulting from all gas burning

instead of coal are:

1. The coal track could be used for other process re-

quirements such as hydro] or syrup systems.

2. Extended boiler life, less abrasion problems.

3. May be allowed extended periods between boiler

. inspections.

4. Reduction in mechanical stores items.

DFF :pld

587 G2 ae

THOMPSON, HINE AND FLORY

SStteeS= NATIONAL CITY BanK BUILDING

e CLEVELAND, OMIO 44114

ty ‘VELEPHONE 24: 1960 amen re

7 (CABLE ADOMERS THOMFLOR

* Parece ;

Srase = san

Toe! Plate August 15, 1968

cerns

Re: U. S. v. General » et al.

Civil Action No. ¢ 1632 (N.D. 11.)

Dear Mr. Cusack:

: ' I trust that

matters about which you made inquiry in your August 7 letter.

JFMcClatchey/rg

cc: Mr.» L. C. Strausbaugh

GENERAL PORTLAND CEMENT COMPANY

4400 REPUGLIC NATIONAL GANK TOWER, P.O. BOX 324. DALLAS, TEXAS 76221

Aves Code 214 742-1551

September 17, 1968

Ret United States v. General Dynamics

Corporation et al., Civil Action

The following information is subuitted as requested by Mr. Futterman by

phone. This is im Liew of questions submitted in « letter dated July 25,

1968 by Mr. John T. Cusak, Attorney, Midwest Office, Antitrust Division.

1. We do not purchase, nor have we purchased, any coal from mines

located in the state qf Illinois, This is true for two reasons.

First, the freight frgm Illinois mines to our plants in Paulding,

Ohio and Fredonia, Kansas makes the cost prohibitive; and secondly,

since it does not come from deep

about our policy relative to sul-

phur content and the methods for compensating for excessive sulphur.

in our purchases of coal because it

—

Mississipp! RiveR CORPORATION

BS0O CLAYTON ROAD

CLEON L. BURT Sr. Louis, Missour! 63124

‘WEE PREROERT- WL « Prone

September 29, 1969 aie

Mr. Hugo Sims

Department of Justice

Room 2634 United States Courthouse

Chicago, Illinois 60604

Re: United States v. General cs

< Corporation, et al., Civil Action

No. 67 C 1632 (N.D. 111.)

Dear Mr. Sims:

In our conversation of several days ago, you asked me certain

questions about the burning of coal in our cement plant at Selma,

Missouri. The questions, as I understood them, and the answers

thereto are as follows:

- Is it intended that our No. 2 Kiln, which is equipped to burn

coal as an alternate fuel, will be switched to coal at times

in the future as and when the gas supply is interrupted?

- The answer to this question is that we do intend and

expect to switch the No. 2 Kiln to the burning of coal

when the gas supply is interrupted.

2. .You inguired as to the usual period of time during which the

natural gas supply to our plant is interrupted or curtailed.

As to this, I cannot give you any better answer than I

did verbally. As you know, the amount of interruption

depends on numerous factors, the principal among which

are the physical deliverability conditions of the pipe-

line supplier and the demands of domestic and commercial

users. During the 1968-69 heating season, I am informed

that gas was curtailed at the plant for between three and

four months; whereas in the preceding year, the curtail-

ment was much less severe. Accordingly, the: curtailment

can vary from almost nothing to three or four months. As

a very rough approximation, I would say that 90 days out of

the year might be a reasonable period on the average for

cement plant gas curtailment.

Very truly yours,

CLB:djs Cleon L. Burt

591

— 2 CABLE 200RE88 “LanowareR”

AT DUBIECT 7o ~ © SS :

HALL. PATTERSON, TAYLOR, MCNICOL & MARETT

. @iac., CUNNINGHAM & Harwood

: 41 East 422 Street

Somnab S.uncme New Yorn, NX 10007

ees p MARETT

WOT B merTCkes

CARLES 5 £04058.

nes 0. erenoeen

Geren Same

May 27, 1968

Air Mail

John T. Cusack, Esq.

Department of Justice

Room 2634 United States Courthouse

Chicago, Illinois 60604

Dear Mr. Cusack:

In response to your letter to American Maize-Products

Company dated April 15, 1968, the following information was gathered

by American Maize-Products Company in response to your inquiries:

Under paragraph 1, total tons or dollar value of annual

coal purchases for the years 1964 through 1967:

Year Quantity Tons Value

1964 117,365 $ 731,601

1965 112,639 697,196

1966 117,449 743,945

1967 106,483 693,437

The tonnage by mine for the years 1964 through 1967:

Year Orient #3 Orient # Orient # ‘otal

1964 . 111,858 5,784 _— 117,642

1965 40,923 4,210 70,241 115,374

1966 6,418 368 108, 486 115,272

1967 6,187 eee 101,310 107,497

There is as you will notice, a difference between the

figures showing tonnage by mine as opposed to Maize's coal purchases.

The tonnage by mine figures are loaded weights at the mine. The

annual coal purchases are the unloaded weights and the difference. _ Rae

is lost in shipping. i 9-0-3 79-4 25.3

a ee a

; MAY 29 1968) 7

: Stk we coe f

John T. Cusack, Esq. oo ~ May 27, 1968

. 3 oa

The coal is used in coal burning boilers for the

generation of steam. The steam in turn is used primarily in

Maize's production department for evaporation and drying of

Maize's products and for space heating. .-

AS a secondary use the steam passes through turbines

for the generation of electricity. The coal is burned in

pulverized coal burning, high pressure boilers, which are also

equipped to burn oil and gas as secondary fuels, The coal burn-

ing boilers are also equipped with continuous pilots, fueled by

either gas or oil. Oil is burned in these boilers only when the

coal supply is interrupted and gas is not available. Gas is

the preferred secondary fuel. When interruptible gas is available,

it is used in preference to all other fuels. :

Annual purchases of fuel oil and gas are listed below:

Year Quantity-Barrels As Tons Of Coal Value

1964 12,273 : 3,515 $ 38,968

1965 10,757 3,080 33,161

1966 11,569 3,313 34,417

1967 28,695 8,217 82,508

Year Quantity-Cubic Feed As Tons Of Coal Value

1964 1,683,575 ,500 76,526 $ 631,749

1965 1,714,460,000 77,930 656 ,467

1966 1,879,110, 000 85,414 771,827

1967 1,897,243, 300 82,148 767,889

‘Im addition to the coal burning equipment Maize docs have

package boilers which are equipped to burn oil or gas. Oil is the

primary fuel of these boilers except when Interruptible gas is

available. The package boilers are preferred over coal burning

boilers because of the lower initial capital investment and the

reduced time between ordering and start-up. They are also preferred

because of the rising hee and cry to air pollution.

PATTERSON, TAYLOR, MCNiCOx. & MARETT

in the drying and é@xtrinization processes.

“The decision and reasons for burning a particular fuel

is governed primarily by cost. The unit cost of Mize various fuels

are as follows:

Coal -02465 $/Therm

oil -04607 $/Therm

Gas (Firm) -0483 $/Therm

Gas (Interr) -0400 $/Thera

The plant can be equipped to convert from coal to gas or

oil in the coal burning boilers with a few changes in piping and

controls, This would probably require a capital investment of ap-

proximately $10,000. The removal, however, of the coal handling

and burning equipment and the ash handling and disposing equipment

would be much more expensive. No estimate is available on the

cost of these removals.

There is no question that if Maize ever discontinued the

burning of coal for any appreciable period, the possibility of

ever returning to coal burning equipment would be very slim. It

would not be practical to try to “moth-ball" the coal handling,

milling and burning equipment.

If we can be of any further assistance, please do not

hesitate to call on us. ; :

Very truly yours,

Ke lee A

Charles J.‘Egan, Jr.

CJE, Jr. /acg

HALL, PATTERSON, TAYLOR, MCNICOL & MARETT

GEORGE A. RANNEY

Dates _ > ye

219 South Dearborn Street :

Chicago, Ilinois 60604 i

Re: United States v. General Dynamics

Corporation et al., Civil Action

In response to your letter dated April 15, 1968, this will advise

as follows:

1. Exhibit I attached hereto sets forth the net tons and dollar

value delivered of metallurgical coal and steam coal purchased from

firms supplying Inland Steel Company's East Chicago, Indiana, facility

in each of the years 1964 through 1967. Mine source of coal where

known is furnished.

Metallurgical coal is consumed in coke batteries for the pro-

duction of coke for the blast furnaces. Steam coal is used to fire boilers

for the production of steam.

2. Inland's East Chicago facility consumes certain other energy

fuels for the purpose or purposes for which coal is consumed. In addition

to steam coal, certain of the electric generating stations burn purchased

petroleum coke, natural gas and fuel oil. Fuel oil is also consumed in

the blast furnaces. Exhibit II attached hereto lists the quantities and

‘

ENERAL OFFICES + 30 WEST MONROE STREET - CHICAGO, HLLINONS GOGO3 ~ AREA CODE 312 + 346-0300

Mr. John T. Cusack Page 2

‘dollar value of the aforementioned petroleum coke, natural gas and fuel

oil purchased in each of the years 1964 through 1967. The exhibit does

not include blast furnace gas or coke oven gas consumed in certain of

Inland's generating stations inasmuch as these are by-products produced

within the plant and not purchased. eat, ;

3. The following sets forth the reasons why Inland's East

Chicago facility has not exclusively utilized one energy fuel in those

instances where other energy fuels in addition to coal are consumed:

(a) In the blast furnaces, fuel oil is injected because

{i) Inland's coke production is not sufficient to cover its total

coke requirements and (ii) additional charging capacity is

available in the skips for ore. For these purposes and in the

' quantities required fuel oil is cheaper, in general, than pur-

chased coke. }

(b) The use of different energy fuels in each of

Inland's generating stations is dependent on the design char=

acteristics of the station. In one generating station fuel oil

is used to cover shortages in available powdered coal, the

economics of fuel oil vs. powdered coal being approximately

equal. A second generating station burns blast furnace gas,

coke oven gas and fuel oil, the facility not being designed to

consume coal. Ata third generating station coal is the

primary fuel, but petroleum coke and natural gas, when

the latter is available, are burned as substitutes for coal

for economic reasons. : oe

Coal is not consumed in the open hearth furnaces, the basic

oxygen furnaces or the reheating furnaces

‘

The information furnished on the enclosed exhibits has been

prepared from a variety of internal sources. We cannot vouch for its

accuracy in every respect. For example, with respect to steam coal

purchases, we have been obliged in certain instances to estimate freight

costs to arrive at delivered values.

preg rae

sorInsolougq

_ af/avo

Tesunoy Tereuen

pue jueprserg SOTA

Aouuey “y 81005

ma.

‘eznok Ajn.213 Azo A e

: . nok 03 peysyurn; drisesvoaen

waszeq uoqjeurzosuy ou} Aqresueprzu03 32023 TITH nod 38n23 IT

i eee

*pez}turqns yIMerEY uoT}euLA O;UT ey} uretdxe Arjny ezour 10

' gzeT3Ue3sqns 03 nzdjoy 20 pepoosu uoTe}WEUNIOp OU Jo MOU OM

¢ o8eg yoesny *L uyor “zw

| Bs May 20, 1968

. INLAND STEEL COMPANY Exhibit I

gene 4 : : =e. j

ee METALLURGICAL COAL PURCHASES

1964. eS 16S 1966 _ 1967

7 - Delivered | Delivered | Delivered : - Delivered |

Supplier Mine Net Tons _ Value ‘ Net Tons Value | Net Tons Value . Net Tons Value

Inland Steei Co. * Wheelwright, Ky. 1, 549,704 $15, 605, 519 | (1,638,139 $16,446,916; 135,653 $ 1, 356, 530

Island Creek Coal Co. Wheelwright,Ky. = |. =" ° |, 1,569,262 15, 849,546 | 1, 676,894 $17,255, 239

Island Creek Coal Co. Bartley #6,W.Va. - | : 108,567 1,155,153! 100,638 1, 105, 00

Freeman Coal Mining Corp. Orient #3, Ml. | 307,474 2, 410, 596 ; 330,095 2,558,236; 401,217 3, 125, 480 | -386,267 3, 009, 020

Old Ben Coal Corp. "Old Ben #21, D1. 73,745 555,300 | - 38, 637 291, 709 58, 357 434,176 250,310 ~—1, 937, 399

Bishop Coal Co. Bishop, W. Va. 1,701,208 18, 645,240 | 1,655,609 18, 128,919 | 1,514,434 16,704,207 1,563,145 17, 538, 487

Jewell Ridge Coal Corp. Jewell Valley, Va. - 234,191 «2, 494,134 | 229,715 2,492, 408° “i 169,088 1, 868, 422 | :

The Pittston Co. _ - Jewell Valley, Va. | 1. 169,088 —_I, 868, 422 4 123,206 1, 452, 599!

Consolidation Coal Co. Seainjonse, W. Va. . | \ & ay SEI eas 55, 766 «39, O78

: 3, 866, 322 “Foi. 789 3,892,195 $39,918, 188. #125, 666. Fer, 936 4, 156,226 $42, 936, 827

Freeman Coal Mining Corp.

Sterling- Midland Coal Co.

Bell & Zoller Coal Co.

Royal Fuel Corp. .

Republic Coal & Coke Co.

United Electric Coal Cos. -

West Kentucky Coal Co.

Island Creek Coal Co.

O'Keefe Bros. Coal Co.

Southern Dlinois Co-op Coal

Sales Co.

*, Coal supplied from Inland Steel Co., Wheelwright, Ky. Mine, valued at market.

STEAM ocak PURCHASES

94, 806 $ 627, 595 6,404 $ 47, 708

42, 400. 308, 213 19, 932 144, 766 |

43,077 | 263, 684 "12, 427 87, 051.

13, 803 101, 472 38, 173 224, 457

46, 071 321, 117 58, 447 331, 484

62, 416 424, 529

7, 342 56, 679 .

5, 210 37, 879°

69, 825 420, 346

i: 227, 032 1, 210, 080 —

309,915 $ 2,103,289‘; 437,450 $ 2, 503, 771/:

3, 217

~ 2,049

5, 660

23, 130

41,901

2, 524

1,035

294, 876

24, 128:

15, 366

42,217

146, 697

250, 568

15,019 ©

7, 161

1, 724, 412

374, 392 -$ 2,225, 508/|

18,878 $

150, 208

112, 286

27, 095

240, 076

946, 332

782, 632

176, 118

308, 467 - $ 2, 045, 158°

a : <2 ii

od e ; $ e: | 3

PURCHASES OF CERTAIN FUELS FOR PURPOSES STATED BELOW SORES

1964 1965 1966 Ens 3

Description Net Tons Value Net Tons Value Net Tons Value Net Tons Value

Petroleum Coke male 3

Power Stations “ : 56,118 $ 350,739 128,239 $ 788,668 97,126 $ 709,022

Gals. Gals. Gals. Gals. eS

Fuel Oil | a | sce

Power Stations 5,306,248 $ 384,703 2,188,813 $ 169,633 3,463,807 $ 251,126 4,149,600 $ 300,846

Blast Furnaces - ee - . 4, 216, 469 305, 694 3, 390, 059 245, 779

MCF MCF: MCF MCF

Natural Gas a Si

Power Stations 5,036,993 $1, 820, 873 3,583,989 $1, 254, 396 5,288,242 $1, 903, 767 5,560,337 $1, 898, 299

Vulcan Materials Company

Bovember 28, 1966

Mr. John Cusack, Attorney

U. 8. Department of Justice

Anti-Trust Division

: Coal Company supplied coal primarily to the utilities

. industry.

o-lf7- = FG Claud

‘ BIFPR TTT og USI

¥ “3

‘.

NOV 29 ings"

BVI .N we wECoarS

; t- -£°

a ee

whe

ENT COMPANY

10 $0. BRENTWOOD BLVD. @ ST. LOUIS, MO. 63105 « PHONE: VOLUNTEER 3-9900

“

‘ : Direct Reply to:

“9900 Clayton Road

'-$t. Louis, Missouri 63124

bo September 11, 1968

Mr. Edwin M. Zimmerman Ae

Assistant Attorney General

Department of Justice

Room 2634 United States Courthouse

Chicago, Illinois 60604

Re: United States v. General Dynamics

Corporation, et al., Civil Action

No. 67 C 1632 (N.D. Illinois)

Dear Mr. Zimmerman:

This is in response to your letter of August 5, 1968,

— information of our company in connection with the

case.

The questions and answers are as follows:

1.A. Total tons and dollar value of annval coal purchases from

all firms eo your Festus, Missouri plant in each of

the years 1965 through 1967.

No coal was purchased for our Festus (Selma)

— plant during the years 1964 through

Please state the purpose for which coal is required and

generally describe the equipment in which coal is consumed.

Coal i= not required in the operation of the plant.

Kiln ko. 1 of the plant, presently in operation,

is not equipped to burn coal. Kiln No. 2, which

is under construction, will be equipped to burn coal.

when necessary or desirable. If and when coal is

consumed, it would be consumed for firing a rotary

¢linker producing kiln (Kiln No. 2) in the pro-

duction of land cement, said kiln to be

17-172" x 16 x 560° in size.

OF RSTCE

SEP 13 19a

MAH wr SLSSTS

ee (= 35"-8

601

Department of Justice | Page 2

Chicago, Illinois : i _ September 11, 1968

2.A. Please state whether your Festus, Missouri plant .consumes

pe Bon ig energy fuel for the purpose for which coal is

required.

See answer to question 1.B. Both natural gas and-

No. 6 o11 are used at the plant for firing Kiln

No. 1. Kiln No. 2 will use natural g@s and coal,

state for each such fuel the annual dollar and

B. If so

‘quantity (barrels of oil, cubic feet of gas, etc.) or

equivalent coal ton purchases for the years 1964

through 1967. ce .. :

No. 6 Fuel 011 . Natural Gas

Gallons — 3p MCF’ t

1964 -0- -0- = -0- - -0-

1965 2,711,12 191,942 1,392,786 375,634

1966 303,77 21,524 — 2,773,905 748,351

1967 1,267,863 132,650 2,773,124 780,439

C. Also, please generally describe the equipment in which each

fuel is consumed.

Kiln No. 1, being a rotary kiln

17-1/2" x 16" x 560" in size.

3-A. If consumption of other energy fuels is in addition to coal

consumption, please state the reason(s) why the Plant involved

does not exclusively utilize one energy fuel. .

Consumption of other energy fuels is not in addition

to coal consumption since there has been no coa

consumption to date. However, the plant is equipped

to utilize more than one fuel to assure continuous

operation of the plant, in case one or more of the

possible fuels is not available or becomes non-

competitive in cost.

Mr. Edwin M. Zimmerman ‘

Department of Justice . ' Page 3

Chicago, Illinois September 11, 1968

If consumption of other energy fuels substitutes for con-

sumption of coal, please indicate the criteria used to

determine when it is appropriate to switch from one energy

fuel to another.

Other energy fuels will not be substituted for

coal; on the contrary, coal may be substituted for

other fuels on Kiln No. 2. Cost and availability

would be the primary criteria for determining when

it is appropriate to switch from one energy fuel

to another. However, various other factors would

no doubt be involved which cannot be determined in

advance. Such factors might include cleanliness,

fuel handling problems, etc.

Please furnish to us copies of any charts, memoranda, surveys

or other documents which would substantiate or more fully

explain the information requested above or which bear on

the advantages, disadvantages, or uniqueness of any of the

energy fuel sources. Please include any studies or

estimates as to the feasibility of immediately converting

from coal to any other energy fuel source. :

None available.

Please state whether or not a ceiling is placed on the sulfur

content or the coal purchased, and if so, state the maximum

tolerable sulfur content and the present sulfur content of coal

consumed.

Should coal be purchased in the future, we anticipate

that we would specify a maximum tolerable sulfur

content of about 3.5% on a dry basis.

Also state whether or not these tolerances may be adjusted to

compensate for low-sulfur or high-sulfur raw materials used

in the manufacture of cement.

Not presently determinable.

Very truly yours,

RIVER CEMENT COMPANY

Cro. babe ee

Cleon L. Burt

General Attorney

Missouri Portitanp Cement CoMPANy

7761 CARONDELET AVENUE

ST. LOUIS, MISSOURI 69105

January 24, 1969

WILLIAM J. BRAMMAN, JR.

WCE PRESIDENT, SECRETARY ;

Mr. John T. Cusack

Attorney, Midwest Office

Antitrust Division

- Department of Justice

Room 2634 United States Courthouse

Chicago, Illinois 60604

Re: United States v. General Dynamics

tion et al., Civil Action

No. 67 C 1632 (N.D. 111.)

In reply to your letter of January 22 regarding the above

matter, I shall further clarify ay letter of Janvary 20

regarding gas purchases at the St. Louis and Joppa plants.

with the exact meaning of the term “seasonal” in your letter.

With respect to the St. Louis plant, it would be significant

to know that gas is now used as the predominant fuel as it is

now less expensive than coal at this point.

Very truly yours, 3 af

BELO

re tee

Soe —— eee . -einew ine comms nates oe

ENGELHARDT, ZIMMERMAN, FRANKE & LAURITZEN |

@6e@ WEST WASHINOTON STREET |

MAT OLO W. NORMAN F

wutian a. cwecinanoy CHICAGO 60602

preveme h G iewbiens 2 ‘ “3 TELEPHONE 236-0008

GEORGE H REDOING, JR

RALPH MELER

yy fora December 23, 1966

WILLIAM K BLANCHARD o

CALIOTT COMEN ‘

WHLIAM P.O RECEFE. sR.

ROGER R. FROSS

Mr. Bertram M. Long

Assistant Chief, Midwest Office .

Antitrust Division :

United States Department of Justice

Room 2634 United States Courthouse

Chicago, Illinois 60604

Dear Mr. Long:

In accordance with our telephone conversation,

attached is a compilation showing the amount of coal in

Gollars and in tons purchased by Marquette Cement Manu-

facturing Company during the years 1964 and 1965 for its

cement plants at DesMoines, Iowa; Cape Girardeau, Missouri

and Oglesby, Illinois.

Due to the location of United Electric Coal

Company and its ability to furnish coal on barges, Marquette,

since at least 193€, has obtained its coal for the Oglesby

plant under long-term contracts negotiated with United

Electric Coal Company.

Similarly, because of its location, United Electric

Coal Company has not been able and has not endeavored to

supply coal to the Cape Girardeau or Des Moines plants.

In view of the factual circumstances, Marquette

cannot see that there would be any effect upon it if the

United Electric Coal Company is eliminated as an independent

supplier of coal.

I am informed that Marquette has not had any arrange-

ments or understandings with General Dynamics Corporation or

any subsidiary thereof to purchase coal from General Dynamics

Corporation or any Subsidiary thereof on condition or

| Pa

WES 27 1966

CON ee REGTRES

Se Sey Sew 78

;

bee

605

i os

pe , oe app tara

ve yg OH Y % 7 tH, a

*sxnoX Atn23 Axon

: vy *eztsep

nok oT eWIOZUT ey3 nok seath Butobez0z ey3 3enx3 is

*es3enbrey wo2zz 3USeWeD eseyornd

zOexey, Axetptsqns Aue z0 sotueudg Tereuep yey} uoTIerepTsucD

996T ‘€% rzequeceq — “o7 Suol *W wezj20q *xW

NAZIMEY 8 DINVAd 'NVHUAKWIZ ‘LOUVATAONA ‘NVHEO~

o€ eet cet ‘l $2 "969 “Bee

£2 °0v6 ‘98

“". 06°096 ‘Sz.

6S "606 ‘LOL. “SL°¥z9 ‘LOT

9L°HE9 ‘82. . SL°zIE'9

09°291 ‘OT > $9 ‘ORS ‘2

68°98S" . sz‘esz'T

POEZH ‘LIT 9L°SSE6Z

00°s9z"S = oz “2ST 'T.

anteA 2ei10d suo L

S961

— hb°H86 ‘SZZz'T | Sh *HZE OOS. mere TROD 2743;90TT poztun

oe Kqsei30

61°6ST ‘BST oO ‘SE0'SH Aueduiod Teo 21qndoy

22°999°S19_ «; SH'OLE‘OST is Aueduiod TeoD ueweer7

VON: ere eeaned 2 A ane ZeT[Gdng NeepresyH eded

- a oe Sa hueduion teoD Apoqeag

- ; - “ee Auedwod [eoD veg PIO

00°SSZ‘62 (sé *HHO'‘B "OD TeoD enusay Aj}s20A7Up

P8°I9L ‘b9 .,.°- 00 °HSE ‘OT Aueduiod [eod urwees 7

68°1PS‘Z. » 0F°969 °OD P®EPT[OSUOD sisuINsUdy

6I°€€l ‘E 7's O8°9F8 Aueduiod TeoD pire |

; Be 7 "= souToW seq

eNTeA 2eTIOW suoL } OTE os ge FS

fan 7961 ig aie ®

ar : ' as Bee Boe a

$961 PUS H96I - SASVHOUNd TVOD

October 21, 1966

Mr. Bertram M. Long

Assistant Chief, Midwest Office

Antitrust Division

United States Department of Justice

Room 2634, United States Courthouse

Chicago, Ilinois 60604

Dear Mr. Long:

Referring to your letter of October 14, 1966 addressed to Mr.

Herbert A. Blair of our Company, File No. 60-0-37, we are enclos-

ing a list of suppliers of coal for the years 1964 and 1965, the quantity

each of these suppliers furnished, and the payments made to each supplier. ‘

No coal received by the Central Illinois Light Company in the years 1964

and 1965 was mined outside of the State of Illinois. :

United Electric Coal Company and Freeman Coal Mining Corporation

have both bid on supplying coal to our Company; however, we have not

considered these two firms to be competitors inasmuch as Freeman

supplied our Springfield Station and United Electric supplied our Peoria

plants. :

To answer question No. 5,

“What effect, if any, may there be on your firm and on other

public utilities if The United Electric Coal Companies is

eliminated as an independent supplier of coal "

would be highly speculative in connection with the effect on other public

utilities; however, we feel the elimination of United Electric Coal Company,

as an independent supplier, would have little or no effect upon the Central

Illinois Light Company inasmuch as we have a long term contract which

runs to a period when, in our opinion, the reserves in the mine that now

supplies us se 3

e awe sa ek 07h sell Very truly yours,

BERERTIIEY? GF

Q. W. Wellington

Senior Vice President, Operations

cc: Herbert A. Blair

Missour! PorTLtaND CEMENT COMPANY

” 9761 CARONPELET AVEXUE

ST. LOUIS, MISSOURI 63105

_ WILLIAM J. BRAMMAN, JP. September 22, 1959

VICE PRESIDENT, SECATTARY -

Mr. Hugo S. Sims, I11 /

Attorney, Midwest Office

Antitrust Division |

Department of Justice

Room 2634 United States Courthéuse

Chicago, Illinois 60604

Re: United States vs. General Dynamics Corporation, et al

Dear Mr. Sims:

In response to your recent telephone inquiry regarding the

above matter, | will attempt to clarify the basis for useage

of coal and gas at our three midwestern cement manufacturing

plants, This data will supplement that previously requested

and supplied in my letters of January 20, January 24, May 2,

and May 21, 1969,

Plant. Gas has been used for all purposes beginning

sometime in 1964 to date. The rate is considered to be interruptible

but the supply is sufficient to serve us without interruption

throughout our entire production year. Production is normally

discontinued for a couple of winter months for economic reasons.

Gas is used because it is cheaper than coal.

St, Louis Plant. Over the years, coal and gas have been alternated

as fuels for kiln operations depending upon the price of each fuel.

The gas used for the years 1964 through 1967, as reported in my

letter. of January 20, 1969, was for heating purposes only. This

gas was purchased on a non-interruptible basis. Coal was used

exclusively for kiln operations because at that time it was more

economical under a long-term contract. For more than a year,

however, we have reverted to alternating coal and gas as fuels

as gas prices have become more competitive. For the twelve

months ended August 31, 1969, coal consumption amounted to

$449,371 for 72,646 tons and gas consumption amounted to $554,828

for 2,173,972 MCF. This gas was supplied on an interruptible

basis at a lower cost than coal, Coal was utilized only during

ae ee

(Gb-A0 21 £25 =a!

a a Ag

BIT . ‘

Bees vers

b heise twine =

' Pg tency. - be .

Se pet 5. —

it, 7 4

al é Bn a a -

SE ae

Mr. Hugo S. Sims, III

Page 2

September 22, 1969

’

Joppa Plant. To date, coal has been the cheapest fuel available

at this plant since its completion in 1963. For this reason it

has been used exclusively for kiln operations. Gas could and

‘would be utilized for this purpose if it»should become cheaper

than coal, The gas that has been used at this plant has been

for other purposes, such as heating and drying, for which it

is preferable for technological reasons. This gas is supplied

on a non-interruptible basis. ,

J th summary, kiln operations at our three plants presently utilize

three different types of fuel supply -- coal at Joppa, gas at

Kansas City and a combination of coal and gas at St. Louis. At

two of these locations, St. Louis and Kansas City, the fuels

utilized have changed in the past five years due to changes in

the competitive prices of coal and gas. Cost is the determining

factor, :

Very truly yours,

ot Autscice

Sruiten Strten

‘

Dederci Cr2d2 Camn-cisctan

Joseph W. Shea, Secretary of the Federal Trade Commission, and official cus-

toda, of sts records, do hereby certify chat attached is a full, truc, and complete copy of :

Respondent Exhibit No. 184 A-F received in evidence in

Federal Trade Commission Docket 8765, in the matter of

Kennecott Copper Corporation.

. “ “Ae. IN WITNESS WHERBOF, I have hereunto subscribed

’ “

‘cue my mame.and caused the seal of the Federal Trade

: [IN SUBPOENA DUCES

DERAL TRADE COMMISSION UNDER DATE

SCEMBER 31, 1968 ON BEHALF OF

-KENNECOTT COPPER CORPORATION

Docket Wa? 76S pesrnccss Exhibit RoR ID

In the Matter of: * 7

baie X Meee ioen: oe PF"

PRICE WATERHOUSE & Co.

> \¥ .

_»acs WATERHOUSE & Co os ies

> New York 1000+

March 6, 1969

The Honorable Donald R. Moore

Hearing Examiner FEDERAL TRADZ COMMISSION

Federal Trade Commission on

1101 Pennsylvania Avenue Cota Bh 2 rrespeses EM TIZYD

Washington, D. C.

Dear Mr. Moore: \

' KENNECOTT COPPER CORPORATION

' In accordance with provisions of Part B of Attachment A to

subpoena duces tecum issued. by the Federal Trade Commission under date

of December 31, 19%8 on behalf of Kennecott Copper Corporation, we have

prepared and submit for your information the exhibits listed below:

Exhibit I - Companies which responded to subpoena duces tecum

II - Selected information requested in subpoena duces

tecum

We have prepared Exhibit II from data furnished to us by the

participating companies listed in Exhibit I, Our work was limited to

receiving and compiling the data into composite form, hence we did not

compare the individual company data submitted to us with the records of

such companies and no audit procedures were carried out by us. Accord-

ingly, while we are Satisfied that the data have been properly summarized,

we can assume no responsibility for the underlying amounts and figures.

Every possible precaution has been taken to prevent the direct

or inferential identification of ™ ydata of a particular company in the

composite amounts and figures. ; ;

eee ke &

Should you have any questions about our procedures in compiling

the data, Please let us know.

Yours very truly,

Puan tSebchoind @

613

COMPANIES WHICH RESPONDED TO SUBPOENA DUCES TECUM

D BY FEDERAL TRADE COMMISSION UNDER DATE

DECEMBER 31, 1968 ON SERALF OF

R RATION

; g COMMISSI

po ee

American 041 Company

Prepress reget Company

Cities Service Company

Continental Oil Company

Getty Oil Company .

Gulf Oil Corporation

Humble Oil & Refining Company

Mobil Oil Corporation

Phillips Petroleum Company

Shell Oil Company

Sinclair Oil Corporation

Standard Oil Company of California

Sun Oil Company

Texaco, Inc.

Union Oil Company of California

ISSUED BY _FEDE RAL TRADE \CO

OF See Ca

NNE iECORT-COPPBR CORPORA

subpoena duces tecum, the five companies shown below reported holding

recoverable coal reserves in 1967:

Atlantic a Company

Oil Company

Sinclair Oil Co ration

2. The above five companies reported holdings of recoverable coal

reserves and acres of coal lands as follows:

(a) Total recoverable coal reserves of 7.8 million tons* in

— and 10,188.7 million tons in 1967.

(b) To of coal lands of 4,524 acres in 1960 and

2. 2 491, 079 acres in 1967. -

tively, of:

(i) Zero aeeeten tons and zero million tons

in Arizona.

(ii) Zero million tons and 234.0 million tons

in Colorado.

(iii) Zero million tons and zero million tons

in Idaho

(iv) Zero mil million tons and 106.0 million tons

Montana.

(v) ee nemo tons and zero million tons

(vi) Zero million tons and 222.0 million tons

in New Mexico.

(vii) a alten tons and 296.5 million tons

(viii) — million tons and 1,276.0 million tons

(ix) Zero sag tons and 2,537.2 million tons

in states west of the "Mississippi River.

*Throughout tons refers to short tons.

ERAL TRADE COMMISSION

ren “a rou hh

EXHIBIT II (Cont'd)

veal acres of coal lands in 1960 and 1967, respectively,

- of:

acres and zero acres in Arizona.

acres and 41,400 acres in Colorado.

acres and zero acres in Idaho.

acres

j :

3. The five companies (listed in Item 1) holding recoverable coal

reserves in the United States.in 1967 are grouped as follows:

(a) One rted total recoverable coal reserves of

over 5,000 million tons.

(b) Two companies reported total recoverable coal reserves

each of 1,000 million to 2,750 million tons.

each of under 1,000 million tons. :

4. The five companies (listed in Item 1) first acquired recover-

able coal reserves or coal lands as follows: .

a) One in 1955

[oe come

One

5. Of the five companies (listed in Item 1), none reported holding

recoverable coal reserves in Utah in 1960. Two of the five companies

reported holding such reserves in 1967.

6. Of the five companies (listed in Item 1), none reported holding

recoverable coal reserves in Arizona, Colorado, Idaho, Montana, Nevada,

New Mexico and Wyoming in 1960. Four of the five companies reported

holding, in aggregate, such reserves in Colorado, Montana, New Mexico

and Wyoming in 1967; mo coal reserves were reported by such companies

for Arizona, Idaho and Nevada in 1967.

19,0

* f°

t— TAF

EXHIBIT IL (Cont *d)

_ Of the fifteen companies (listed in Exhibit I), eleven

.~ported expeacirures for research, study, or development in the conver~-

sion of coal to synthetic fuels, with the following breakdown by years:

ea0 om

(

*Four panies reported estimated aggregate expenditures of

$291,300 for the period 1963-1967. No specific breakdown

was furnished for the individual years in that period.

9. The eleven companies referred to in Item 8 reported expendi-

tures of $14,138,748 for research, study, or development in the conver~-

sion of coal to synthetic fuels during the years 1963-1967, both

inclusive, of which $6,508,473 was reported as company funds and

$7,630,275 as grants from others.

COM MISSION

FEDERAL TRADE

Preset ka_276 nesroscents Exhibit wa PSE

617

Standard Oil Company (New Jersey)

1968 Annual Report

We are plorsc? to report thet earntics of

Standazd C2 Corypcuy (New Jersey) in 1938

never sed F3™ milian fo a pees} £3,277 ni Hon,

or $5.94 per stirs, ny 20.8 por co:.t over the eoz-

parable carvings of $5.96 per shore in 1967: Ac-

comiiing chenges, which are d:scribed i the

notes tu the aceon:p. nying Gnancial statements,

had the effect of reducing the earnings fizures

for both yeers.

‘Dividend poymen‘s te shereholders weve in-

creased for the eighth year in a row—from $9.5

per shave in 1867 to $3.65 in 1233. This wes the

86th comsceutive yexr of dividend distributions.

Tote! revenue rose to $15,873 million, an in-

erensc of 7.7 per cent over 1937.

Production of crude oil and naturel gas liquids

reached a new high rate of 5,225,000 barrels a

day, up $2 per cent over 1967, with marked

incres<es in production in the United States,

Venezuela, and Libye. Improved manufacturing

facilities in all areas and expanded capacity in

Europe made po-=sible reeord refixery erude oil

runs of 4,621,009 barrels « day. Worldwide sales

of petroleum products iereased 5.0 per eent to

4,831,000 barrels a day.

The prodvetion cud sale of naturel gas is mat:-

ing an increszingly significant contribution te

Jersey's tots! revenne. In 1938 sales of natural

fas Invensel sharply to 5,296 million enbie

fect a dis. Sales in the large U.S. market ae-

counted for 99.8 por cent of the tatzd. However,

fast-growing sales in Europe more than donbled

those of 1967. Jerses’s 30 por cont interest in

Mevenb, 1959

prodvction from the Gronincon S@2 in the

Netherlunds, fey sele fr Het eonatry avd feres

port, is ecpccted to deuble ns ty be 1978. Thiel

Ccliverie: of nitural ¢.+ frecr the folds in tHe

North Sex, immiuont spo 264 ef ligne toe net-

tral ges from Wihys to Sarin and Tety, aad the

begining of gre dclive tes frova our jeint Ver

ture in Australie clso rttest to the srocing Pa.

portimnec of gas to the compeny’s future resvlis.

Jersey's performence in 1263 is attributable

in large moasire to the resuks of en aggressive

invesiment program. Cepital expenditures mde

ir recent years have provided the capacity for

si, sifieant ineresses in operating volumc>. Con

Mittin» of det"

income

ids ¥

618

tirsec efforts towird cecst retuction end eF-

ciency atso have contributed to lu:prove2 proft-

ability. Jersey’s retur: on average shareholders’

equity inerested to 12.3 per cent last year, up

fror: 12.6 por cent the year before and the highest

ir more then « decade. Further improvement is

expected in 1959.

In 1£6S compeny investhaents in new property,

plert, ene ecu'p.iont anionnted to $1,954 million.

SlighUy move then bslf of the 1955 investments

were in the United States. A further $195 million

was spent en? charged to income in 195S as part

of the coimpany's world-wide exploration pro-

gram which is desigucd to support the objectives

of inerccsing reserves and of diversifying the

compsuy’s sources of crade oil and natural gas.

Afiiliates are finding and taking advantage of

major opportunities for increasing earnings in

the futare. In addition to the growth of neture!

gas sales, the investment progrems associated

with crude oil production from the Alaskan

Aretie anc offshore southeastera Australia are

of particular importance. The grand seale of

these exciting opportunities requires a continued

high level of capital expenditures—a leve! which

the company’s strong financial position makes

possible to maintain.

The demand for energy throughout the world

POR THE BOAED OF DIRECTORS

BLL. Hamer, Cheirinan

. in the future is strengthened by the enthusiastic

continwes to inerense steadily. Improvements in

the stex.card of living in industrialized nations

and greater realization of aspirations among de-

veloyitig countries ensure dynamic growth in the

demand for energy.

In the United Siates, total energy require-

ments are estimated to increzse at an average of

4 per cent 2-year, which means in ten years they

will be almost half agcin as large as they are

today. The demand for oi! and gas, which supply

three-fourths of these requirements, is antici-

pated to grow proportionately. Energy consump-

tion is incressing even faster elsewhere in the

free v. orld, and oi] and natural gas are expected

to supply nearly all the near-term growth in

these energy requireraents.

Jersey afSliates will maintain their traditional

leading position as suppliers of petroleum prod-

uets to free world countries. Their demonstrated

success in meeting the needs of growing markets

in the continents of the globe promises to con-

tinue the company’s growth and profit improve-

ment in 1969 and the years ahead. Our confidence

commitment of the thousands of company em-

ployees around the world. We appreciate their

loyal efforts as well as the continued support of

our shareholders.

J. K. Jasresox, President

ah ie

”

619

(1967 rosteted, see pege 23) :

Total ri. snus, miMious of dollars $15,072 $14,744¢

Net incsina, millions of dclacs $ 1,277 ¢ 1,155°

Cach divigonds pais, wi7ions of dollars $ 725 $ 743

Shar shoidars’ equity, millions of dollars ’ $ 9,555 $ 9,375

Net income per shere ¢$ 594 $ 5:36°

Cash dividends per share $ 3.65 .$ 3.45

Sharche'¢ srs’ equity per share $ 45.23 $ 43.57 —

"Nat income to average suarsholJers’ cavity, per cent ; 133 12.6°

Net income to total revenue, per cent 8.0 7.8°

*Ezcludes estimated recoveries of $49 million or $0.18 a share on elaixus for World iar II losses.

2iMions of do"lars

-2,200

UC. -2.Stotes Foreic: yen

Otke . -ctera Hemisphere : 7 + States ome

Eastern i shere Millions of dolicrs F =

-1,300 ,

1 § | ‘ -1,600

i < 1,500

; -1,100 1,400

| ea 23ee -1,300

-1,100

—800 -.1,000

ee —700 .—900

Fees 8 _ 600 aed

—— 2 mr Se —s00 fe

PER BS Sk Soe ee | ‘ 400 ‘500

ApS EES & i “e : 400

"300

“Se ae *_.200

-— 106 +300

nae y4 J i ? | eee

1989 1968 2 1968

Net irs. Capitc: ><itures

620

United States The vigorous growth of the United

States economy accelerated the demand for en-

ergy during 1968. Humble Oil & Refining Com-

pany continued to contribute significantly to

Jersey's results and to be a leader in the domestic

industry.

The year’s highlight was the discovery of oil

and gas on the North Slope of Alaska by a joint

venture composed of Humble and Atlantic Rich-

field Company. One successful well was drilled at

Prudhoe Bay and another at Sag River, seven

miles away. In this North Slope area, Humble

has a 50 per cent interest in approximately

800,000 acres. Evaluation drilling and scismic

work are continuing. The discovery appears to

be very significant, but further drilling is neces-

sary to provide an estimate of the reserves.

Widespread speculation over the relative size

of the potential North Slope reserves has tended

to obscure the unusual problems and costs esso-

ciated with exploring for oil in Alaska, produc-

ing it, and transporting it to markets. Substantial

investments will be required to overcome diffi-

culties attributable to extreme cold, the remote-

ness of the North Slope, the absence of transpor-

tation facilities, the tundra over the permafrost

which becomes swamp-like in summer, and the

ice in the Arctic Ocean.

To start North Slope crude oil on its way to

markets by 1972, Humble and other interested

companies intend to build a 48-inch pipeline and

terminal] at an initial cost of about million.

The line will run some 800 miles from Prudhoe

Bay—across the tundra and permafrost, two

mountain ranges, and several river valleys—to

a year-round deep-water port in southern Alaska.

In addition, Humble and other companies, with

the cooperation of the U.S. Coast Guard and

Department of the Navy and the Canadian De-

partment of Transport, plan to test the feasibil-

ity and economies of carrying oi! through the

’ Aretie Osean, between Canada’s Aretie islands,

and into the North Atlentic. This icy route,

known as the Northwest Passage, will be tested

later in 1969 by a chartered tanker which will

have an exceptionally strong hull, an icebreaker

bow, and special equipment to protect propeller

and rudder.

Humble and other companies invested sub-

stantial sums in 1968 to acquire leases from the

federal government off the consts of California

and Texas. Offshore California, in the Santa

Barbara Channel, three discovery wells have

been announced, in one of which Humble has an

interest. Humble also had encouraging results

at other locations nearby. Further work will be

required to define the magnitude of reserves. Off-

shore Texas, in the Gulf of Mexico, exploration

results so far have been disappointing. Some in-

dications of oi] and gas were encountered at one

* wellin which Humble has an interest, but the com-

mercial potential of this area remains doubtful.

Onshore Humble had a good exploration year.

In addition to the Alaskan find, significant dis-

coveries included two oil and gas wells in the

Delaware Basin of West Texas, one in southern

Louisiana, and one in deep sands of the old Pol-

lard field of Alabama. Future drilling should

United States operating data 1933 Change from 1957

948,000 7.0%

943,000 3.4%

1,518,000 22%

< 4,280 138%

621

Prosuction of crude o* aud netaval gre tigtids, bares a @ay

Other erece od oftake cade: special avrangew eute

Total

Retinory runs, barvels u dey

Patrotoum pre. ci 82°78, barrels a day

Natural gas exl2s, wiltion ewhte feet a day

Cacinicel recor, mi"ions of dollars

‘ Affliate owned

Vanikers, deodweight tone capecity Period chartered

Total

Pipolines, barrels « day throunk pa’

provide sufficient informetion for substantial re-

serve additions from these discoveries during

the next few years.

During 1965 Humbie improved profitability by

increasing production and applying additional

cost control measures in its oil and gas fields.

A computerized system to measure and control

production was introdueed in the Friendswood

field near Houston to test techniques for automa-

tion of producing properties. Continued empha-

sis also was placed on the identification and

disposition of producing properties which were

marginal to Humble's operations.

Humble’s new 72,000-barrel-a-day refinery at

Benicia, California, was approaching completion

at the end of 1968S. This refinery, designed by

Esso Research and Engineering Company, is

planned for intensive refining of heavy erade oils

to give high yields of motor gasoline. Computer

technology will be used extensively in controlling

this highly eomplex operation.

Sales of petroleum products set new highs.

New operating efficiencies, coupled with relative-

ly firm prices for these greater volumes, helped

to offset rising costs for goods and services.

4,092,009 6456009

__ 333,629 _ 372,009

5,225,029 4,233,050 8.2%

4,621,000 4,437,099 41%

4,821,099 4,647,000 5.0%

6,295 41s 19.8%

933 815 144%

6,082,099 5,415,000

7,783,000 7,384,099

13,870,009 12,799,609 84%

6,509,000 §,990,002 8.7%

Taking advantage of opportunities offered by

new road construction and honsizg develop-

ments, Humble ixaugurated about 500 new ser-

vice stations in locations having potential for

large sales volumes and closed a number of less

profitable retail outlets. ore

Humble also continued to euhance the appear-

ance of its service stations. Many existing out-

lets were modernized and landseaped, and new

stations were designed to harmonize with and

complement their neighborhoods.

In innovating to offer a broader line of ser-

vices to the motoring public, Humble increased

from 30 to 47 the number of its car eare centers.

These centers offer more complete vehicle ser-

vicing than regular service stations and a Hum-

ble guarantee of work performed. At some of its’

car care centers, where high volume justified the

additional investment, Humble also installed di-

agnostic facilities which provide computerized

analyses of vehicle safety and performance.

Humble continued its active participation in

the rapidly growing market for jet aireraft fuel,

deriving about 10 per cent of its 1968 market

sales volume from this product. Humble and

éther aMfliatcs combinee tereased by about 16 :

per cent their 1963 worldwide commercial jet

fuel sales. Investments were made in refining,

transporiation, and storage fecilities in the

United States + * abroad to enable affiliates to

keep pace Ww" > grow ch of the airlines’ pas-

senger mud caryo fleets. The first of the now

jumbo jet aircraft will use Esso fuels in New

York and key European cities Inte this year.

Humble revenues benefited from significant

growth in sales of both natural gs and liquefied

petroleun gas. Sales of natura! gas, already at

high levels, grew by 14 per cent, owing primarily

to deliveries uuder long-term cortracts made in

previous years. Sales of netural gas plant liq-

uids were up 18 per cent, mostly as a result of

increased p2troclemical feedstock sales. Over a

three-year period and at a cost of $80 million,

Humble built 13 new gas plants and expanded

14 existing one: in Texas and Louisiana to re-

mov: additional liquids from natural gas to sup-

ply this rapidly growing business.

Humble also broadened activities in two other

forms of energy: coal and uranium.

In early 1969 a Humble subsidiary, The Carter

Oil Company, which holds large bituminous coal

reserves in IHinois and the Rocky’ Mountain area,

signed a long-term sales contract with Conmmon-

wealth Edison Company of Chicago. The con-

tract calls for delivery of about three million

tons of coal annually. Work was begun to develop

an underground mine at Carlinville, Mlinois, to

supply the coal to the utility eompany.

In evaluating its uranium: holdings, Humble

determined that a deposit in Live Ozk County,

Texas, contained more then five million pounds

of reeovernble uravimn oxide, and a coutract is

_ being negotiated with a nonaMliated company for

the conmercis:! development of this ore body.

Corctz Imperial Of) Lizwited aceelorated ‘its

prograia for the exploration and evaluation of

its strong land position covering about 10 million

acres in the Mackenzie River Delia of the Cana-

dian Arctic, 300 miles to the east of the Alaska

North Slope diseovery. Three seismic parties are

at wort: in the region, and the eompany is drilling

‘one exploratory well on wifolly owned acreage,

while a second well is being drilled on acreage in

which Imperial has a one-third interest. Imperial

also continued to develop production in estab-

lished oi) fields in the Rainbow-Zama area of

northern Alberta and to explore other areas of

Canada, principally in the West.

Imperial, the leading oil marketer in Canada,

continued to expand its petroleum product dis-

tribution facilities. An important part of its

Cancdc op wating Cate ISzS = Changetrom 1°57

61%

23%

29%

12.3%

marketing program has been the installation of

automotive service eenters, which Imperial pio-

neered in Canada. At year-end 36 of these cen-

ters were in operation.

Letin Aincrica In Venezuela, Creole Petroleum

Corporation started construction of a fuel oil

desulfurization plant at Ammay refinery. Lago

Oi! & Transport Company, Limited, whieh vroc-

esses substantic] volumes of Creole eride oil for

export, will build a similar plant in Aruba,

Netherlands Antilles. These plants were desigaed ~

623

DEFENDANT'S EXHIBIT 82

UNITED STATES DISTRICT COURT

FOR THE

DISTRICT OF NEW JERSEY

{

Civil Action No. 954-64

UNITED STATES OF AMERICA, PLAINTIFF

STANDARD OIL CoMPANY (NEW JERSEY) and

PoTasH COMPANY OF AMERICA, DEFENDANTS

Before the Honorable Robert Shaw

PLAINTIFF’S PROPOSED FINDINGS OF FACT

. AND CONCLUSIONS OF LAW

NICOLAUS BRUNS, JR. -

RICHARD T. CoLMAN

Attorneys, Department o Justice

Washington, D. C. : !

5. Jersey ‘is among the nation’s largest industrial cor-

porations possessing enormous financial resources, con- \

tilizer products. It has grown significantly in recent

years due in large measure to a policy of expending

5a. Jersey is a large industrial corporation with.

enormous financial resources, and world-wide opera-

tions and investments.

5b. Jersey has grown significantly in recent years,

due in large measure to a liberal policy of capital

expenditure and the acquisition of other firms.

5b(2). Jersey’s capital expenditures, including

amounts spent in searching for oil and gas reserves,

have averaged more than $1 billion annually over the

decade preceding 1963, and have been primarily re-

sponsible for the company’s continuing growth. (GX

2).

5d(4). Jersey Production Research Company is a

wholly-owned subsidiary of Jersey which conducts re-

search in connection with methods for determining

and recovering mineral deposits, principally oil. Any

non-petroleum mineral deposits which the company

discovers are recorded and reported to Jersey. (Rath-

bone Tr. 839-41).

5e(3). The Board Advisory Committee on Invest-

ments (BAC) provides assistance to Jersey and its

affiliates in evaluating proposed investments, and also

initiates studies of investment opportunities. The

BAC reports directly to the Board of Directors and

maintains contact with Jersey’s various departments.

(GX 113, Stip. of Fact No. 2, par. 1). The BAC

BMITED STATES DISTRICT COURT

ae FoR Tile

DISIRICT O RE JERSEY

CIVIL ACTIGN NO. 954-64

UNITED STATES OF AMERICA,

Plaintiff,

STANDARD OTL. COMPANY (NEW JFRSEY)

_ end POTASH COMPARY OF AMGRICA,

Defcadants.

BEFORE i0E RCUORABLE ROSERY SHAY

PLAINTIFF'S MSHORANDUM ACCOMPANYING PLAINTIFF'S

PROPOSED FIND™CS OF FACT AND CONCLUS FOSS _OF_ LAY

FRED D, TURNAGE

WICOLAUS ERUNS, JR.

RICHARD T. COLMAN

Attorneys,. Department of Justice

Washingtor., D. C.

Plaintiff, CIVIL ACTION NO. 954-64

PLAINTIFF'S PEIORANDUM ACCOMPANYING PLAINTIF?'S

Pacr OF

Simultonsously herewith the Plaintiff is filing its propoced findings

of fact and conclusions of Lev which exe fully supported by record refer

ences, “Rather than repeat the factual detail set forth tm the proposéd”

findings or set forth egain the many references to, and quotations from,

the defendants" own documents #8 was done in Plaintiff's pretrial brief,

thie wemocandum sucuarizes the plaintiff's factual contentions and roletes

thea to the legiclative purpose underlying Section 7 of the Clayton Act

end to receat Supreme Court decisions. °

Summary of the Care

Pending the outconc of this litigation, Jersey hae been enjoined fron

coasuxmating its costract to cequire PCA's avsets, Conewrmatioa of the

contract was originally scheduled for October 21, 1964 and vould have achieved

Jersey's goal of producing end marketing potash. Jerecy's interest in the

potach business began in sbout 1960 whon it fixst became interested i becoming

_@ major fertilizer producer, This was consistent with ite continuous desire

_ to put its tremendéous Crsnbedied. Tesources to work by making and selling profit~

able new products to both new markets and to existing markets in which it was

then so successfully selling petroleum and related products. —

Jersey's production of its by-product natural gas, from which ammonia

is made, led it to manufacture anhydrous ermonia for fertilizer use. In turn,

this led it into the menufacture and sale of a full line of fertilizers éc-

Tiveé from phosphate and potash. Soon it had extensive fertilizer facilities

in Central South America and in other foreign countries. In addition, it was

actively exploring the poseibilitics of entry into the fertilizer business in

the United States. To supply ite huge actual and potential raw material require-

ments, it sought to develop and acquire potash and phosphate reserves. With

this objective, through its Couadien subsidiary, Jersey had already spent be-

tween two and three million dollars and proposed to spend en additional ons

and one-half willioa dollars, to conduct the exploration and test drilling

essential for the ultimate production of potash.

In a sutehell, the Goversnent's case rests on its contention that

because Jersey vas so motivated to mine and market potash end because it

hed the resources to satisfy this desire, it would probably have entered

into the production and marketing of potash in competition with PCA and

, 629

other United States potssh producers by intesusl expansion or by othor

meens had it not made-e contract to acquire PCA. Accordingly, the aeqri-

sition, if mot permancat)y enjoined, will eliminate Jersey ec @ poteutial

competitor to PCA end the other United States potach producers, It will

also inacdiately foreclose such other producers from the opportunity of

supplying Jevesy"s exbsidieries with ths enormous emounte of potash they

require for their fertilizer manufacturing operations,

Argucent

The Statutory Prevose of Section 2

H. Rep, 1191 (81st Congress, 1st Session) wakes clear that the enend-

ments to Section 7 of the Cleyton Act were concerned with th> broad proBlea

ef the high level of econcaie concentration in the American economy, Congrese

viewed with elerm the increasing pover in the hands of the Jergest corpo-

retioas end since the trend vas found to be dve in considerable part to the

external expansion of business through mergers and acquisitions, principally

by lerge corporations buying ovt susll conpanies, Congress sought to sten

the tide through the enti-merger provicioas of the Clayton Act. Thus,

the purpose of the 1950 anendaents was "to limit future increases in the level

of economic concentzation resulting from corporate mergers ead acquisitions."

(S. Rep. 1775, Blst Coagress, 2nd Secsion). Acquisitions beyond the reach

of the Sherman Act were to be proceribed and Section ? was intended to be

an effective guard cgainst “econontcally eigaificeat acquisitions,"

Congress. therefore, prohibited cequisitions viete the effect may be

substantially to lessen competition in any line of corncree in my section

of the covatry, There wes to be uo requirement of actuality or certeinty

in the injury to competition because aaticenpetitive consequerces were

intended to be arrested in their ineSpteacy before they developed.

The legislative history shows particular Congressional concern with

acquisitions by large corporetions end a broad plan of preserving a free

enterprise system of decentralized, ingependent units, The Supreme Court

has expressly recognized that in deciding the legelity of a merger it must

weigh heavily this economic way of life which Congress was trying to pre~

serve and that mergers which offended it were to be blocked, Browa Shoe

* Co. v. United States, 370 U.S. 294, 333 (1962). Thus, the size of the

acquiring compzny has uniforoly been eoaatéeced & most importent end

@ecisive factor in evaluating acqvisitioas.

The Suprece Court bas applied this philosophy in @ number of instances

to strike dowa mergezs end acquisitions involving large firns or where the

competition which wight eventually be lessened was solely potential in

character. For instence, in United Stetes v. Alumfnua Company of /meriea,

377.U.S. 271 (1964), the Suprene Court held thet the acquisition of the

Rome Czble Corp. by Alcod violated Section 7 by eliminating actual compe-

tition between them in the sale of aluninum wire and cable, Already the

leading producer in the field, acquisition by Alcoa of Rome would add but

1.3% to its market share. But "[P]reservetion of Rome, rather thea ite

absorption by one of the gieate, will kesp it ®ac ea important competitive

631

factor’ . . ." the Court said (at p. 261). In United States v. Fl Paso

Nature) Gas Co., 376 U.S. 651 (1954), Pacific Northvest Ges Co. bed been

unsuccessivl ju efforts to sell natural gos in California, covld not get

the gac needed to set up 2 project and was unable to satisfy the regulatory

egencies es to its ability, but yet the Supreme Court held that 4t was a

substanticl potentiel conpetitor because of its efforts end its interect

in the business end the attrectiveness of the market, The entry of now

firme in # booming warket denonstvated the eppoctunitior ubichwere- fd fect

available, On this basis, the Court found the acquisition of Pectfic

Northwest by El Paso to be in violation of Section 7. Similarly, in

United States v. Penn-Olin Chemical Co., (378 U.S. 158 (1964)), the

Supreme Court noted that the relevant business was expending and both Pena-

salt end Olin Mathieson were strongly motivated to enter the market indo- |

pendeatly. Thus, the Court held that their formation of a joint sabia

to do s0 eliminated potential competition botween then including the poteatiel

competition afforded by a firm which mey have merely remained a threat to

enter at eons indefinite future time.

Thus, Section 7 proscribes acquisitions eliminating the threct of

evehtual competition ce well as those eliminating a substantial factor

in ectusl competition, This is particularly so, as indicated above, whoa

the ecquisition is bathe made by a very large corporation,

The Elinsretion of Potential Competition

Between Jorscy and PCA.

Here, Jersey, the laxgest industrial corporation in the world in terms

of essets held, has a record of intensive interest and activity looking to

the cevelopment of its de potash production and manifestly cogent notivation

for doing so. The ettrective profit opportunities in this growing field, ite

coxmplewentary reletionship to fertilizer activities in which Jerecy wes already

becoming an increesingly importent world-wide factor, Jersey's need te carry :

@ full line of fertilizer wsterials for werketing purposes and need for a rav

materiel position to achieve perticipction in the nost profiteble part of the

busindss, are all fectore which will continue to move Jersey in this direction

aven 10 this acquisition is barred. Jersey's desire for captive potash to supply

its fertilizer plents ccunot justify its elimination by acquisition of one of

the lecding competitors it would otherwica face in the production and marketing

of potash. gs

Jersey bas the meaus and wotive to erter the business of producing and sell-

ing potash on a svdstantial scale without acquiring a large potesh producer, :

Under the cases, no more need be shown to bar this acquisition. But the fact

is Chat Jersey was actively engaging in activities calculated to bring about

an entry into the business throcgh self-developaent. 1/

/ The Govervzent does not contend that Jersey's efforts to integrate or

Giversify are wolevful, On the contrary, such efforts increase competition

end add to the netional resovrees. But the Government is attacking the

means. sclected by Jecszy to grow, i.e, the elfmination of the leading indo~

pendent competitive factor.

The economics of the fertiliger industry were irrevocably craving Jorecy

intoa potash producing position, This is clearly denonstrated by the

company's own docuaents, Once in the fertilizer business Jersey soon learned

it could maximize fertilizer profits by producing potash instead of buying

it. It learned that carrying a full line was most desirable from a compe-

titive marketing viewpoint. It found that the potash industry offered gues

growth possibilities and that potash was a product with vast seles potential

which was in no danger of competition from other products, Jersey examined

potash sources which could supply its own requiremcnts and took ovt permits

in the area of the richest known potash beds in the world, Jt pursued a

detailed solution mining experiment and conducted an extensive nuaber of

studies, surveys of competition and warket analyses, Solution mining was,

however, temporarily shelved, in pert to perait evaluation of the results

of solution miuing by others but mostly because a larger sized conventional

mine would make possible greater profits. But since large scale production

could be more casily sold if Jersey had a partner to share the burden, Jersey

found acquisition of PCA to have benefits over and above those which would

be secured after taking the trouble to develop its owa buciness. Moreover,

‘Jersey found that it woold require a delay of four to five years before

it could begin producing on its on and by that time it have have to face

the competition of seeds’ other new entrants a8 well as the competition

of the(few established suppliers presently in the businese. Acquisition

of PCA elsely eliminated this deley and geve Jersey a jvup on the other

potential producezs, end gave it en experienced sales organization and e

market over end above its-own growing necds for potach. Use of its

checkbook instead of herd, honest’ work in the market place was a simple vcy for

Bersiy to-chtcin a ctcasnaudiag position in potash overnight.

Jersey was s0 motivated to become a potash producer that it would have

used its checkbook to continue its self-developuent program, but for the

agreenent with PCA. It is not necessary to-speculate where or exactly when

it would have achieved its goal, It had several permits in the Canadian

potash fields and may have found it feasible on further coiitinsintibiins dit

construct a conventional mine or at least revert to the solution mining:

technique

This text is long and has been trimmed here. Open the source document for the complete record.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.