Appendix C 



Mineral Laws of the United States 



The five legal systems discussed below illustrate the 

 changes in national minerals policy over the past cen- 

 tury. One major shift was from a policy of free disposal, 

 intended to foster development of the frontier, to a leas- 

 ing policy intended to provide a return to the public and 

 to foster conservation by controlling the rate of develop- 

 ment. A second change resulted in a balancing of miner- 

 al values against other values for the land in question. 

 Thus, the Mining Law of 1872 requires only that the 

 land be valuable for minerals, but the leasing laws al- 

 low a lease only after a prospector shows that the land 

 is "chiefly valuable" for the mineral to be developed. 

 The leasing laws, and, to a greater extent, the Outer 

 Continental Shelf Lands Act also require consideration 

 of economic and environmental impacts, State and lo- 

 cal concerns, and the relative value of mining and other 

 existing or potential uses of the area. A third change 

 was a recognition that different types of minerals could 

 best be developed under different management systems. 

 The hardrock minerals remain under a system that re- 

 wards the prospector's risk-taking, the fuel resources are 

 leased under a system that takes national needs and pri- 

 orities into account, and common construction materi- 

 als are made readOy available under a simplified sales 

 procedure. When creating a legal regime for the mineral 

 resources of the Exclusive Economic Zone (EEZ), the 

 United States can benefit from long experience under 

 several diverse systems. 



The experimental nature of much of today's explo- 

 ration and recovery equipment and the gaps in our 

 knowledge of the physical and biological resources of 

 the EEZ indicate that it may take years of research and 

 exploration before an informed decision to proceed with 

 commercial exploitation can be made. A legal system 

 must reasonably accommodate the risk being taken by 

 the mineral industry under these circumstances. At the 

 same time, the system must also accommodate impor- 

 tant public interests and ensure a fair market value for 

 the public resources. The law must also consider the na- 

 tional and State interests in ocean development and de- 

 fine the respective Federal and State roles. 



Onshore Mineral Management 



Federal onshore minerals are managed under three 

 principal legal systems: the Mining Law of 1872, the 

 Mineral Leasing Act of 1920 and related leasing laws, 

 and the Surface Resources Act of 1955 (table C-1). The 

 laws do not apply uniformly to all Federal lands, and 

 a mineral may be subject to different rules in different 



places, including some cases where there appears to be 

 no applicable law at all. 



The Mining Law of 1872 



The Mining Law of 1872 is applicable to "hardrock" 

 minerals in the public domain in most States. Like other 

 laws of its era, it was intended to expand development 

 of the Western States by making Federal lands availa- 

 ble to persons who occupy and develop them. It adopt- 

 ed a system that was developed under State law and local 

 custom between the start of the California gold rush in 

 1849 and passage of the first mining law in 1866. 



All valuable mineral deposits and the lands in which 

 they are found are free and open to exploration, occu- 

 pation, and purchase. State mining laws and customs 

 of the mining districts are recognized to the extent that 

 they do not conflict with Federal law. The Mining Law 

 outlines the requirements for locating, marking, and 

 evaluating claims; sets a $100 minimum for annual ex- 

 penditures on labor or improvements; and provides for 

 transfer of ownership to the miner when these condi- 

 tions are met. Depending on the type of deposit, pay- 

 ment of $2.50 or $5.00 per acre is required. The 

 Government receives no royalties or other payments for 

 the minerals. 



In its original form, the Mining Law allowed for the 

 greatest individual initiative and the least Government 

 regulation. Over the years, its operation has become 

 more restricted. First, the Government has withdrawn 

 extensive areas from the operation of the Mining Law 

 when they were needed for other purposes (military 

 reservations, national parks, dam and reservoir sites, 

 etc.). Second, certain minerals were excluded from the 

 law and made available under other programs. Third, 

 mining operations are subject to environmental and 

 reclamation requirements and varying degrees of review 

 and approval by the surface management agency. Pri- 

 or to issuance of a patent, a claimant's use of a mining 

 claim is limited to that required for mineral exploration, 

 development, and production. Nonconflicting surface 

 uses by others may continue. 



Mineral Leasing Acts 



Concern over resource depletion and monopolization 

 in the early years of the 20th century lead to withdrawls 

 of coal,- oil, phosphate, and other fuel and nonmetallic 

 minerals from entry under the Mining Law. In 1920 

 Congress passed the Mineral Leasing Act, making these 



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