That is correct.
Back when the sale happened, I called IR and had a long talk with them.
Basically, since I watch so many stocks in the JPM arena, it occurred to me that there might be issues in two areas
A couple of years later, it is clear, BTW, that neither was an actual issue of concern. Let me relate the details, as I recall them after all the time that has passed.
Here were my concers in making that telephone call.
A.) In the west, there is a considerable presence that is often an issue.... that of Native American tribal issues.
B.) The other heavy presence was already well established as relevant in the case of SFMI: the BLM
My concern when I first read the info about the intent to build the mill was two-fold.
A) were there entanglements related to Native American issues?
and
B) what of the BLM lands?
I wanted to go over whether either of these impacted SFMI. I percieved SFMI doing it's typical "give too little info" waltze and I wanted to head them off early so I could be satisfied that the mill would not be two years in the building.
As we all know, it took next to no time to build, and as my recounting below will illustrate, SFMI handled this entire matter admirably.
Let me recount what I was told, but please bear in mind that the conversation was a while back.
First, the land on which they built was the only private land out there. They managed to carve out 20 acres from, if I recall, a 1000 acre tract.
This was strategic because it meant thet neither the BLM nor the Native American issues encumbered the build out.
As such, it implied that the ease with which progress could be made was.... well, it could have been an issue in either area of my concern. To our benefit, in that this was a private land owner, these matters that could have complicated things considerably simply fell by the wayside. They were well handled and they were non-issues.
A lot of criticism has been lobbed, like mortar rounds into forward fire bases back in 'Nam, on PQ for being a real estate guy rather than a mining guy. Look: IMHO, in this case, the puveyors of this line of criticism just need to button their lips. It needs to be granted that having an experienced real estate guy at the helm helped us significantly in this instance.
Point number two with me involved the electric power issue. The mill was going to be a rather heavy new presence on that part of Idaho's power grid.
I was concerned that it would take time to pull cable out there in the high desert where no power lines existed. And the issue, thinking ahead back then, seemed to me to be that the land around the mill was going to probably be either Native American or BLM... or both.
Having to engage in negotiations with either of these parties would have taken time (slowing the build-out) AND it would involve political entites forcing themselves onto the BOD AND it would cost a royalty of some kind that would never go away. The way SFMI has solved this electric power issue was to use on-site generators. I was deeply concerned, but in fact, it has turned out that PQ made excellent management decisions and the net result has been that there are no political outsiders imbedded in the BOD. There are no on-going royalty issues that came about because of the need to cut a deal to gain access rights across other people's land. And the build out was not held up one little bit. Simple as that.
They decided, it was explained to me, that it was not a vaible approach to encumber the build out with the impediments of both time and cost presented by the pulling of heavy power lines all the way out there. So, they solved the problem and generators are the way they have gone.
Again... well done, IMHO.
Now then.. let me recount more of the conversation's details.
OK... so, as I've attempted to convey, I perceived that SFMI was being a tad slow with the details following up on their announcement that they had bought the land. Here's what I was told happened. SFMI had to pay to get a survey done. They did so. They discovered that the BLM was intruding into the acerage of the base 1000 acre tract by (and I may be inaccurate as to this number of feet, since it was so long ago.... but this is what I recall).... BY 600 FT!!
So SFMI discovered a huge BLM survey error that ran all up and down the range and affected every land-owner whose land abutted BLM land.
As described above, I called because I suspected they would be facing a hold up of indeterminate length due to the negotiations needed to get high power lines pulled across Native American land.
What I unearthed was something rather huge that affected the entire community up there.
It turned out that the BLM had operated for many years on incorrect surveys of the entire front of the mountain range out there in that part of the West. Had this sale of 20 acres not gone thru, then the bad survey would have stayed in use and innumerable land owners all along the range up there would never have known that the government was illegally claiming a 600 ft swathe of their lands.
So basically, because SFMI bought this land, they had to do a new survey. In the course of doing so, they found that 600 feet of land was claimed wrongly by the BLM.
OK... Once I heard this stuff, the relevant question for me was whether this was going to hold things up. Remember, I had called because I was uneasy about why it appeared that things were moving too slowly. I guessed it was related to negotiations over power lines but I found out that it had been slightly impeded by the discovery of the bad survey.
As it turned out, the private land owner sold them land that was well inside the correct part of the survey. The 600 ft problem did not hold things up for SFMI
As such, again, we benefited by having an experienced real estate guy at the helm because the sale went thru lickety-split and we all saw the nimble way they built the mill because they broadcast the build-out over live web cam.
Furthermore, this matter has implications for today. Here's why.
Last night, someone posted that they felt that the county would impede the permitting for the new lab site SFMI wants to build.
Now bear in mind that this is a small rural county.
A rich guy from Florida comes in, infuses the area with new industry, new jobs, and the biggest economic plus for the area this last few years.
And then consider that he benefited every land owner all along the range up there by spending his own money to document that the government owed land owners monitarily & in way of a corrected survey, 600 feet all along the range.
IMHO, there is no chance the county is going to stick its thumb in SFMI's eye.
The county officails are elected. They attend the same Masonic lodges as the land owners. The same Mormon churches.... the same basketball games & little league games.
SFMI has benefitted this community in innumerable ways and they will get the permits expedited. Count on it.
Hope this helps
:o)
Imperial Whazoo
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