at least 100,000,000 tons reserves and that they would like to produce about 3000,000 tons annually, providing the present exploration reveals sufficient or, reserves. The Canadian Bureau of Mines has furnished the following schedule of anticipated production from the "A," "B," and "C" ore bodies based upon information they have gathered from the Steep Rock Iron Mines, Ltd. TABLE II.-Anticipated production of iron ore from the Steeprock deposits 1951–65 [In millions of gross tons] From the above, it is apparent that the Steeprock deposits will not and cannot replace the anticipated deficiencies in our iron-ore supplies as the open-pit Mesabi Range direct shipping ores are depleted but that they will make a worthy contribution. The development of the deposits should be encouraged and every available effort should be made to get this ore into our Great Lakes steel-producing area. It will take all of the Steeprock ore and all of the Labrador iron ore that we can get to meet our future demands of our expanded steel industry. The longitudinal section of the "B" ore body shows the mode of occurrence of the ore body and the maximum depth that can be mined by open pit methods. In only a few years underground mining' methods will have to be resorted to and the flexibility of production will be limited. The shaft is now under LONGITUDINAL SECTION-STEEP ROCK MINING PLAN (Thereupon, at 1:45 p. m., the committee was adjourned,) ST. LAWRENCE SEAWAY MONDAY, FEBRUARY 26, 1951 COMMITTEE ON PUBLIC WORKS, The committee met, pursuant to adjournment, at 10 a. m., Hon. Henry D. Larcade, Jr., presiding. Mr. LARCADE. The committee will come to order for further consideration of House Joint Resolutions 2, 3, 4, 15, 102, 122, and 159, and H. R. 2536, approving the agreement between the United States and Canada relating to the development of the resources of the Great Lakes-St. Lawrence Basin for national security and continental defense of the United States and Canada; and providing for making the St. Lawrence seaway self-liquidating. I would like to say to the committee that the Honorable Charles A. Buckley, our chairman, has requested me to preside this morning due to the fact that he is unable to be present today. In opening the meeting I want to sa v it is an honor for me to preside here at the appearance of the distinguished Chief of Engineers, General Pick, who is the first witness this morning. General Pick, we are glad to have you, and I presume you have a statement which you desire to read, after which the members of the committee will be glad to ask you questions. STATEMENT OF MAJ. GEN. LEWIS PICK, CHIEF OF ENGINEERS, UNITED STATES ARMY General PICK. Thank you, Mr. Chairman. As Chief of Engineers I am always glad to appear before your committee, and today I do have a statement on the resolution which I would like to make. Then I would be very glad to try to answer any questions, Mr. Chairman, that may be asked. Mr. LARCADE. Thank you, General. You may proceed with your statement. General PICK. Mr. Chairman and gentlemen of the committee. I appear before you today as Chief of Engineers to advocate the building of the Great Lakes-St. Lawrence seaway and power project and building it now. Chiefs of Engineers before me have found this project sound in engineering and economically justified; an undertaking in keeping with the progressive peacetime development of the Nation. Today it is more than that. It is essential, even vital, I believe, to the national strength and security. It is my considered judgment that the construction of this project will come nearer to providing solution for some of our pressing and basic problems than any other resource development project that can be built at this time. In my ensuing statement I propose to discuss briefly the following pertinent topics: Project description; project construction costs; critical materials and manpower required; economics and self-liquidation of the power phase; economics and self-liquidation of the navigation phase; traffic capacity; adequacy of 27-foot project; Labrador ore; status of plans for International Rapids section project; construction schedule; operations with initial appropriation of $34,000,000; time required for Corps of Engineers to start construction. The St. Lawrence project, when completed, Mr. Chairman, will provide a major and much needed transportation artery connecting the industrial heart of the Nation with the sea. It will also connect a new and great source of high-grade iron ore with the the greatest consuming center and at the lowest possible cost for transportation. The project will also harness the great hydroelectric potential of the St. Lawrence River near Massena, N. Y. Briefly, the project outlined in the 1941 agreement between Canada and the United States provides for deepening the channels connecting the Great Lakes, including the Welland Canal, from 25 to 27 feet, widening the existing 27-foot channel in the St. Lawrence from Lake Ontario to Ogdensburg, N. Y., and building navigation facilities in the 114-mile reach from Ogdenburg downstream to Montreal to afford a 27-foot channel with modern locks, as compared to the existing 14foot project. Major works are a large dam, powerhouse, and three locks in the international section of the St. Lawrence River, four locks in the Canadian section, and dredging in the various reaches to be improved. A more detailed description of the project works is contained in an attachment to my prepared statement. PROJECT CONSTRUCTION COSTS I now present cost estimates for the over-all project, Duluth to Montreal, based upon December 1950 cost levels. In the preparation of these estimates, actual bid prices for the numerous individual items involved were taken from current construction jobs of comparable nature by the Corps of Engineers. Furthermore, the engineers of my staff have been in consultation with engineers of the Canadian Department of Transport who have furnished corresponding estimates for Canada's share of the remaining work under the 1941 agreement. I consider this joint cost estimate sound. For a project with a 27-foot channel depth, combined costs of construction for the remaining work on December 1950 levels are summarized as follows: Canada, $251,269,000; United States, $566,794,000; total, $818,063,000. In accompanying tabulations more detailed summaries are presented. CRITICAL MATERIALS AND MANPOWER REQUIRED The major item in the over-all development involving heavy construction is the International Rapids section development. It will require 65,000 tons of reinforcing steel, 88,000 tons of structural steel, 3,800 tons of copper, 5,420,000 barrels of cement, and 78,700 M. b. m. of lumber. Those materials would be required over a 5year period and would be furnished by the two countries combined. In other words, that is all the material that is required for the entire development. The remainder of the over-all development, insofar as construction by the United States is concerned, involves dredging operations only. Construction of the International Rapids section development on an expedited schedule will require an approximate average of 7,000 American and Canadian workmen on the job. ECONOMICS AND SELF-LIQUIDATION OF POWER PHASE The Barnhart Island powerhouse will be one of the greatest hydroelectric generating stations on the North American continent. It will supply power in a rapidly expanding power market area both in the United States and Canada. There will be a total installed generator capacity of 1,881,000 kilowatts, including 940,500 kilowatts on the United States side. The plant will produce an estimated average annual output of 12.6 billion kilowatt-hours of energy, to be equally divided by the United States and Canada. The economic feasibility of the power phase of the project is indicated by the estimated average at-site energy cost on the United States side, with public financing, of 1.77 mills per kilowatt hour, and an estimated average cost at typical load centers in the New YorkNew England area of 3.44 mills per kilowatt-hour, as compared to the estimated average cost of coal only for modern steam-electric plants in the area of 3.85 mills per kilowatt-hour. The United States share of the power project, including charges for interest and amortization on the power allocation cost, will be self-liquidated. The cost to be allocated to the United States share of the power facilities under the formula referred to in section 5 of the bill is $192,493,000. Since that sum is to be repaid into the Federal Treasury, the estimated cost to the United States for the over-all development, Duluth to Montreal, is reduced from $566,794,000 to $374,301,000, even without any provision for further reimbursement through navigation tolls. ECONOMICS AND SELF-LIQUIDATION OF NAVIGATION PHASE The pending legislation, Mr. Chairman, contemplates making the new deep-water navigation works on the St. Lawrence River selfliquidating by charging reasonable tolls. Let us therefore consider the prospects of such self-liquidation. The Commerce Department has estimated potential seaway traffic at from 57 to 84 million tons annually. Iron ore is the principal item, being placed at from 30 to 37 million tons a year. It was estimated by that Department that tolls on prospective tonnage would yield from 36 to 48 million dollars annually and still provide a surplus of savings to attract tonnage. Annual economic carrying charges for the new navigation facilities on the St. Lawrence, from Lake Ontario to Montreal, are estimated at $16,712,000. That includes costs for operation, maintenance, repairs, interest on the investment, and amortization, with interest at 21⁄2 percent. Comparison of the anticipated toll revenue-at least 36 million dollars yearly-with annual economic charges of $16,712,000-demon 81181-51-pt. 1—14 strates that the navigation facilities on the St. Lawrence can be made self-liquidating. With respect to the economic feasibility of the over-all navigation development, Duluth to Montreal: The Commerce Department's report indicates that the shipping savings on the prospective tonnage will be considerably greater than the toll charges, which I have cited above. While that Department has not made a monetary estimate of actual shipping savings, I have had my staff review the Commerce Department's report and other available data. This examination indicates that the annual shipping savings on the potential traffic over the 27-foot seaway might well aggregate over $60,000,000 yearly. Annual economic charges for the entire navigation phase, Duluth to Montreal, are estimated at $20,360,000 annually, with financing at 21⁄2 percent. With savings approximately three times the charges, there is clear indication of economic feasibility of the over-all navigation phase. TRAFFIC CAPACITY During 1950 the existing St. Lawrence canals between Ogdensburg and Montreal carried a record traffic of about 10 million tons. This is essentially capacity shipping for the existing fleet of canal vessels under existing traffic patterns via the 14-foot bottleneck now present in the St. Lawrence River. During the same year the Welland Canal handled almost 15 million tons which is, of course, far below its capacity. As to the locks at the Soo, MacArthur lock alone handled about 48 million tons in 1950 and 55 million tons in 1948. The practical operating capacity of the Welland Canal and the improved St. Lawrence River Canal system is dependent upon a number of factors, including nature of the vessel fleet, loading per vessel, density of cargo, and balance between up-bound and downbound traffic. The Welland and the St. Lawrence can have a practical operating capacity of the order of 45 to 50 million tons annually. ADEQUACY OF 27-FOOT PROJECT The 1941 agreement provides for a waterway with a controlling channel depth of 27 feet, with a depth of 30 feet over lock sills. A seaway of that design can carry a great volume of traffic, as is illustrated on the Great Lakes, where the existing controlling project channel depths between Lakes Superior and Erie are 25 feet in the down-bound and two-way channels. During the 1940's Great Lakes traffic passing the St. Marys Falls Canal, Mich., averaged 108 million tons annually. Principal commodities were iron ore down-bound in an average amount of 80 million tons and up-bound coal at 14 million tons. Those tonnages were carried in vessels with drafts ranging from 18 to 24.6 feet. The 80 million tons of ore handled during the 1950 calendar year was moved in vessels ranging in draft from 20 to 24.6 feet. The average load was 12,500 tons, ranging from 10,500 to 17,190 tons. About 70 percent of the 1950 ore tonnage, namely, 56 million tons, was carried in vessels with drafts ranging from 21 to 23 feet. The present Great Lakes fleet could operate over a 27-foot seaway without restriction. |