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 Author: PAWA
PostPosted: Fri Jun 14, 2013 2:01 pm 
The following was presented to the recent meeting of the Legislative Finance Committee:

Freeport McMoRan operates a successful business in Grant County; that is, it makes a profit, spends money for equipment, supplies, and salaries, supports local charity, and pays taxes. Perhaps one should not look a gift horse in the mouth, but being from the other side of the mountain, I want to draw your attention to the simple fact that the cost of that mining is different for the company from the cost of that mining to New Mexico. We can look at Freeport McMoRan’s balance sheet and see that it makes more than the operations cost. It is making a profit. But where is New Mexico’s balance sheet? What is the cost of copper mining to the State?

I’d like to suggest that if everything is considered, the state of New Mexico is running a big deficit relative to this business. The reason for this discrepancy is that the people of New Mexico give water to Freeport McMoRan for free. It gives a very large amount of water (about 21,000 acre feet or 7 billion gallons a year [2005 OSE statistics]); that amounts to a huge subsidy. From the point of view of the Finance Committee, then, a crucial question about copper mining is whether it is worth it.

We can do a simple estimate of what we New Mexicans pay to support Freeport McMoRan. The market price of copper is about $3.50 per pound. Just the flotation process for that pound of copper takes about 60 gallons of water [Bleiwas, “Estimated Water Requirements for the Conventional Flotation of Copper Ores,” USGS, 2012], water that is potable, taken out of the aquifer and never returned, thus forever removed from our supply of water. Freeport McMoRan uses much more water than just in the flotation process, but that gives an idea of the magnitude of water used in copper mining. Potable water costs, say, $1.00 a gallon at the grocery store [we use market prices to compare value], so that the state of New Mexico gives $60 worth of water to Freeport McMoRan so it can produce $3.50 of copper, out of which it makes a profit, pays its taxes, hires workers, buys equipment, donates to the university. A very good deal for the profit takers but not a good deal for the people of New Mexico. Now, here is a suggestion for the Committee: if Freeport McMoRan sold water instead of copper, it could increase its profits 17 fold, 1700%, and we’d have a cleaner environment. If New Mexico sold that water, it could subsidize the whole of Silver City and probably 17 other cities like it. Economically speaking, then, this profitable business is a huge burden upon the state. The gift horse does turn out to be a Trojan horse.

How much of a threat to the economic well being of New Mexico copper mining is can be seen by considering the fact that water is in such short supply that we are in a water crisis. The drought is not temporary. Studies of long term rainfall in New Mexico stretch back over 2000 years, and they show that deep drought is a norm http://www.tomudall.senate.gov/files/do ... Report.pdf. Because our rainfall occurs much of it in the summer, most precipitation evaporates. In the lowlands only about 1% of precipitation replenishes the groundwater [Mattick, Duval, and Phillips, "Quantification of Groundwater Recharge Rates in New Mexico. . . ," NM Water Resources Research Institute, March, 1987]. More water evaporates off the streams, lakes, and reservoirs of New Mexico than falls on the state.

Faced with this crisis, the Finance Committee needs to consider the economic value of water. How much value does a particular activity produce per amount of water used? Using this kind of measure is something that should be done for all industries in the state by the Committee. Copper mining, I suggest, will turn out down at the bottom of the list along with golf courses and pecan groves, not very productive relative to its water consumption.


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Silver City & Southwestern New Mexico Monthly Community Calendar

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Community Events
Week of November 23, 2017

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23
Arte Chicano de San Vicente @ SC Museum
Our Paws' Cause Thrift Store
Volunteer at The Bike Works 3-7pm
Tai Chi at Lotus Center
Blooming Lotus Meditation
Pet Central Thrift Store
Our Paws' Cause Thrift Store
24
Arte Chicano de San Vicente @ SC Museum
Qi Gung for Health at the Lotus Center
Fiber Arts Collective's Holiday Fiber Art Sale
Holiday Fiber Art Sale
Women's Al-Anon Meeting: Women Embracing Recovery
Pet Central Thrift Store
Hapkido Class
Community Bike Ride @ The Bike Works
Our PAws' Cause Thrift Store
25
Arte Chicano de San Vicente @ SC Museum
Tai Chi Chuan
Fiber Arts Collective's Holiday Fiber Art Sale
Shop Small Saturday
Lighted Christmas Parade
Ecstatic Dance
26
Arte Chicano de San Vicente @ SC Museum
New Hope Al-Anon Family Group
27
Hapkido Class
Tai Chi Chuan
Laughter Yoga at 1 p.m. at the Lotus Center
28
Arte Chicano de San Vicente @ SC Museum
Silver City Rotary Club Meeting
International Folk Dancing
Hapkido Class
Compassionate Friends Gathering
Tai Chi at Lotus Center
Wine & The Word @The Toad Brewery
Creative Writing for Beginners-free workshop
ToSC Council Meeting- Agenda
Our Paws' Cause Thrift Store
29
Arte Chicano de San Vicente @ SC Museum
Hapkido Class
Tai Chi Chuan
Insight Buddhist Meditation
Gin Rummy
Wednesday Evening Al-Anon Family Group Meeting
Concert Band of the Southwest “Not Just A Holiday Concert”










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