[Congressional Record Volume 141, Number 80 (Monday, May 15, 1995)]
[House]
[Pages H4919-H4925]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 GREENS CREEK LAND EXCHANGE ACT OF 1995

  Mr. YOUNG of Alaska. Mr. Speaker, I move to suspend the rules and 
pass the bill (H.R. 1266) to provide for the exchange of lands within 
Admiralty Island National Monument, and for other purposes, as amended.
  The Clerk read as follows:

                               H.R. 1266

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Greens Creek Land Exchange 
     Act of 1995''.

     SEC. 2. FINDINGS.

       The Congress makes the following findings:
       (1) The Alaska National Interest Lands Conservation act 
     established the Admiralty Island National Monument and 
     sections 503 and 504 of that Act provided special provisions 
     under which the Greens Creek Claims would be developed. The 
     provisions supplemented the general mining laws under which 
     these claims were staked.
       (2) The Kennecott Greens Creek Mining Company, Inc., 
     currently holds title to the Greens Creek Claims, and the 
     area surrounding these claims has further mineral potential 
     which is yet unexplored.
       (3) Negotiations between the United States Forest Service 
     and the Kennecott Greens Creek Mining Company, Inc., have 
     resulted in an agreement by which the area surrounding the 
     Greens Creek Claims could be explored and developed under 
     terms and conditions consistent with the protection of the 
     values of the Admiralty Island National Monument.
       (4) The full effectuation of the Agreement, by its terms, 
     requires the approval and ratification by Congress.

     SEC. 3. DEFINITIONS.

       As used in this Act--
       (1) the term ``Agreement'' means the document entitled the 
     ``Greens Creek Land Exchange Agreement'' executed on December 
     14, 1994, by the Under Secretary of Agriculture for Natural 
     Resources and Environment on behalf of the United States and 
     the Kennecott Greens Creek Mining Company and Kennecott 
     Corporation;
       (2) the term ``ANILCA'' means the Alaska National Interest 
     Lands Conservation Act, Public Law 96-487 (94 Stat. 2371);
       (3) the term ``conservation system unit'' has the same 
     meaning as defined in section 102(4) of ANILCA;
       (4) the term ``Green Creek Claims'' means those patented 
     mining claims of Kennecott Greens Creek Mining Company within 
     the Monument recognized pursuant to section 504 of ANILCA;
       (5) the term ``KGCMC'' means the Kennecott Greens Creek 
     Mining Company, Inc., a Delaware corporation;
       (6) the term ``Monument'' means the Admiralty Island 
     National Monument in the State of Alaska established by 
     section 503 of ANILCA;
       (7) the term ``Royalty'' means Net Island Receipts Royalty 
     as that latter term in defined in Exhibit C to the Agreement; 
     and
       (8) the term ``Secretary'' means the Secretary of 
     Agriculture.

     SEC. 4. RATIFICATION OF THE AGREEMENT.

       The Agreement is hereby ratified and confirmed as to the 
     duties and obligations of the United States and its agencies, 
     and KGCMC and Kennecott Corporation, as a matter of Federal 
     law. The agreement may be modified or amended, without 
     further action by the Congress, upon written agreement of all 
     parties thereto and with notification in writing being made 
     to the appropriate committees of the Congress.

     SEC. 5. IMPLEMENTATION OF THE AGREEMENT.

       (a) Land Acquisition.--Without diminishment of any other 
     land acquisition authority of the Secretary in Alaska and in 
     furtherance of the purposes of the Agreement, the Secretary 
     is authorized to acquire lands and interests in land within 
     conservation system units in the Tongass National Forest, and 
     any land or interest in land so acquired shall be 
     administered by the Secretary as part of the National Forest 
     System and any conservation system unit in which it is 
     located. Priority shall be given to acquisition of non-
     Federal lands within the Monument.
       (b) Acquisition Funding.--There is hereby established in 
     the Treasury of the United States an account entitled the 
     ``Greens Creek Land Exchange Account'' into which shall be 
     deposited the first $5,000,000 in royalties received by the 
     United States under part 6 of the Agreement after the 
     distribution of the amounts pursuant to subsection (c) of 
     this section. Such moneys in the special account in the 
     Treasury may, to the extent provided in appropriations Acts, 
     be used for land acquisition pursuant to subsection (a) of 
     this section.
       (c) Twenty-Five Percent Fund.--All royalties paid to the 
     United States under the Agreement shall be subject to the 25 
     percent distribution provisions of the Act of May 23, 1908, 
     as amended (16 U.S.C. 500) relating to payments for roads and 
     schools.
       (d) Mineral Development.--Notwithstanding any provision of 
     ANILCA to the contrary, the lands and interests in lands 
     being conveyed to KGCMC pursuant to the Agreement shall be 
     available for mining and related activities subject to and in 
     accordance with the terms of the Agreement and conveyances 
     made thereunder.
       (e) Administration.--The Secretary of Agriculture is 
     authorized to implement and administer the rights and 
     obligations of the Federal Government under the Agreement, 
     including monitoring the Government's interests relating to 
     extralateral rights, collecting royalties, and conducting 
     audits. The Secretary may enter into cooperative arrangements 
     with other Federal agencies for the performance of any 
     Federal rights or obligations under the Agreement or this 
     Act.
       (f) Reversions.--Before reversion to the United States of 
     KGCMC properties located on Admiralty Island, KGCMC shall 
     reclaim the surface disturbed in accordance with an approved 
     plan of operations and applicable laws and regulations. Upon 
     reversion to the United States of KGCMC properties located on 
     Admiralty, those properties located within the Monument shall 
     become part of the [[Page H4920]] Monument and those 
     properties lying outside the Monument shall be managed as 
     part of the Tongass National Forest.
       (g) Savings Provisions.--Implementation of the Agreement in 
     accordance with this Act shall not be deemed a major Federal 
     action significantly affecting the quality of the human 
     environment, nor shall implementation require further 
     consideration pursuant to the National Historic Preservation 
     Act, title VIII of ANILCA, or any other law.

     SEC. 6. RECISION RIGHTS.

       Within 60 days of the enactment of this Act, KGCMC and 
     Kennecott Corporation shall have a right to rescind all 
     rights under the Agreement and this Act. Recision shall be 
     effected by a duly authorized resolution of the Board of 
     Directors of either KGCMC or Kennecott Corporation and 
     delivered to the Chief of the Forest Service at the Chief's 
     principal office in Washington, District of Columbia. In the 
     event of a recision, the status quo ante provisions of the 
     Agreement shall apply.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Alaska [Mr. Young] will be recognized for 20 minutes, and the gentleman 
from Hawaii [Mr. Abercrombie] will be recognized for 20 minutes.
  The Chair recognizes the gentleman from Alaska [Mr. Young].
  Mr. YOUNG of Alaska. Mr. Speaker, I yield myself such time as I may 
consume.
  (Mr. YOUNG of Alaska asked and was given permission to revise and 
extend his remarks and to include extraneous matter.)
  Mr. YOUNG of Alaska. First of all, Mr. Speaker, let me thank the 
gentleman from Hawaii [Mr. Abercrombie] for his work and cooperation on 
this bill.
  Mr. Speaker, I am pleased to rise in support of the Greens Creek Land 
Exchange Act of 1995.
  This act will approve a land exchange agreement between the U.S. 
Forest Service and Kennecott Greens Creek Mining Co. (``Kennecott''). 
These lands surround the Greens Creek Mine, a zinc-lead-silver-gold 
mine, located on Admiralty Island in southeast Alaska. The land 
exchange agreement is the product of a nearly 10-year-long negotiation 
between the two parties.
  Under the Greens Creek Land Exchange Agreement, Kennecott receives 
the right to mine mineral deposits on about 7,500 acres of land, 
located in Admiralty Island National Monument. In return, Kennecott 
will: First, pay a royalty to the Federal Government on any production 
from these lands, and second, purchase and donate to the U.S. Forest 
Service 1 million dollars' worth of inholdings located within the 
Admiralty National Monument--an amount of land equal in value to the 
land received under the agreement.
  The royalty is based on the value received from 1 sales after 
deduction of shipping, smelting, and refining charges. The royalty has 
two tiers depending on the value of the ore. When metal prices are 
average or better, the royalty will be 3 percent, and at low metal 
prices, the royalty will be three-quarters of 1 percent. This two-tier 
royalty will encourage the Greens Creek Mine to continue operation in 
times of low metal prices.
  This land exchange will help promote sound economic and 
environmentally responsible resource development, support land 
consolidation in conservation system units within the Tongass National 
Forest, and raise revenues for the Federal Government.
  Mr. Speaker, I urge an ``aye'' vote on H.R. 1266 and thank George 
Miller for his leadership in the effort to approve this land exchange 
agreement. I look forward to the successful completion of the Greens 
Creek land exchange and hope that it will help provide new economic 
opportunities for those who live in southeast Alaska.
  Mr. Speaker, I include for the Record the text of the Greens Creek 
Land Exchange Agreement:
                               Agreement

       This Agreement, by and between Kennecott Greens Creek 
     Mining Company, Inc., a Delaware corporation (``KGCMC'') and 
     The United States of America, by and through the U.S.D.A. 
     Forest Service (``USFS''), dated     , 1994.
       Whereas, on December 2, 1980, Congress established the 
     Admiralty Island National Monument (the ``Monument'') by 
     enactment of the Alaska National Interest Lands Conservation 
     Act (``ANILCA'') (P.L. 96-487):
       Whereas, the Monument was established as part of the 
     Tongass National Forest for the purpose of protecting objects 
     of ecological, cultural, geological, historical, 
     prehistorical and scientific interest, in particular its 
     wildlife and supporting habitats;
       Whereas, Congress designated approximately nine hundred 
     thousand acres of the Monument as wilderness under ANILCA;
       Whereas approximately 17,000 acres of the Monument was 
     designated as non-wilderness to permit the development of a 
     silver, lead, zinc and gold deposit;
       Whereas, KGCMC, as manager of the Greens Creek Joint 
     Venture (``GCJV'') has developed the Greens Creek Mine (the 
     ``Mine'') on 17 claims which were located prior to the 
     establishment of the Monument (the ``Existing Claims'');
       Whereas, operation of the Greens Creek Mine, which is 
     located approximately 15 miles from Juneau, Alaska, can 
     produce 450,000 tons of ore per year and contribute over 265 
     jobs to the local economy of Southeast Alaska;
       Whereas, KGCMC hopes that the life of the Mine and the jobs 
     it provides can be extended by further exploration and 
     development of subsurface lands within the non-wilderness 
     portion of the Monument adjacent to the Existing Claims;
       Whereas, such development can occur without significant 
     adverse environmental effects by utilizing existing 
     facilities of the mine for the most part and minimizing 
     surface disturbance on Monument lands;
       Whereas, further exploration and potential development of 
     the Mine can be accomplished without significant impact to 
     the Monument and its purposes;
       Whereas, KGCMC has proposed a land exchange to acquire 
     rights to explore and mine adjacent subsurface lands in 
     return for conveyance to the United States, through the USFS, 
     of important private inholdings located within the Monument 
     and/or other Conservation System Units within the Tongass 
     National Forest, the
      assignment to the United States of a royalty interest in the 
     returns from any future development from mining the lands 
     acquired by KGCMC through the exchange, and a restrictive 
     covenant and future interest in the Existing Claims, Mill 
     Site #1 (MS 2514), and other lands held by KGCMC located 
     on Admiralty Island;
       Whereas, the result of such land exchange would include 
     consolidation of Federal land ownership in the Monument 
     Wilderness in return for the right through title to explore 
     and mine the subsurface lands adjacent to the Mine within the 
     existing non-wilderness area of the Monument, in an 
     environmentally sound manner.
       Whereas, the accomplishment of such land exchange for the 
     purposes of Conservation System Unit consolidation and for 
     the purpose of permitting further exploration and development 
     of the Greens Creek Mine is in the pubic interest under the 
     terms of Section 1302(h) of ANILCA; and
       Whereas, this land exchange is being accomplished under the 
     land exchange authority of Section 1302(h) of ANILCA:
       Now, therefore, the parties to this Agreement agree as 
     follows:
       1. General Description of the Exchange. The USFS agrees to 
     exchange the mineral estate, subject to a future interest and 
     other provisions of this Agreement, in 7500 acres, more of 
     less, of subsurface public land (the ``Exchange Properties'') 
     delineated on a map and description title ``KGCMC Exchange 
     Properties'' dated March 26, 1993, designated Exhibit A of 
     this Agreement. KGCMC agrees to exchange in return: i) title, 
     or alternatively, funds to acquire title, to private 
     inholdings (``Exchange Inholdings'') totalling no less than 
     $1,000,000 in fair market value from lands located within 
     Admiralty Island National Monument and, if necessary, other 
     Conservation System Units within the Tongass National Forest, 
     from a list titled ``KGCMC Exchange Inholdings'' dated 
     November 6, 1993, designated Exhibit B hereto; ii) a royalty 
     interest in ``Net Island Receipts'' realized from the sale of 
     minerals that may be mined from the Exchange Properties, 
     (excluding those minerals which are property of KGCMC by 
     operation of extralateral rights); and iii) a restrictive 
     covenant and future interest in the Existing Claims, Millsite 
     #1 (MS 2514), and any other lands held by KGCMC located on 
     Admiralty Island. The specific interests to be exchanged and 
     terms and conditions thereto are described elsewhere in this 
     Agreement.
       2. Effective Date. This Agreement shall become effective 
     upon its execution by both parties and approval by Act of 
     Congress. The effective date of this Agreement shall be the 
     date of enactment of Federal legislation approving this 
     exchange.
       3. Termination. In the event the exchange closing described 
     in Section 4.A is not completed within seven years from the
      effective date of this Agreement, this Agreement shall 
     terminate and become null and void upon expiration of 
     seven years from the effective date. The terms of this 
     Agreement shall otherwise be incorporated in the 
     conveyances completed pursuant to this Agreement. Both 
     parties state their intent to exert reasonable best 
     efforts to complete the exchange closing as soon as 
     practicable in advance of seven years from the effective 
     date.
       4. Exchange Details. 
       A. there shall be a single exchange closing. At the 
     closing, the following conveyance shall occur:
       (i)(a) the United States shall receive fee title via 
     general warranty deeds to the surface and subsurface estate 
     of Exchange Inholdings totalling no less than $1,000,000 in 
     fair market value, subject only to any reservations, 
     exceptions, or conditions approved prior to closing by the 
     USFS. Upon conveyance, each Exchange Inholding shall become 
     [[Page H4921]] and be managed by the USFS as part of the 
     Conservation System Unit having exterior boundaries within 
     which the Inholding is located.
       (b) In the event that the Congress enacts legislation 
     establishing a special fund in the Treasury for the deposit 
     of monies to be available until expended, without further 
     appropriation, for the acquisition by the Forest Service of 
     lands and interests in lands within the exterior boundaries 
     of Admiralty Island National Monument or other Conservation 
     System Units within the Tongass National Forest, KGCMC shall, 
     in lieu of the conveyances described in (i)(a), pay to the 
     United States the sum of $1,100,000 at the closing, for 
     deposit in said fund. Monies from said fund shall be 
     available for the purchase of lands and interests in lands 
     and related administrative costs.
       (ii) KGCMC shall receive title to the entire interest of 
     the United States in the form of a patent upon completion, at 
     KGCMC expense, of a survey meeting Bureau of Land Management 
     standards, to the Exchange Properties, comprising the 
     subsurface mineral estate of the lands described in Exhibit 
     A, along with rights appurtenant to such estate identical to 
     those provided for an ``unperfected claim'' as defined in 
     section 504 of ANILCA (16 U.S.C. 432 note) once patent to the 
     minerals of such claim is conveyed by the United States. 
     Provided, the Exchange Properties conveyance shall 
     specifically reserve the restrictive covenant and future 
     interest in the United States as described in Section 8, and 
     shall specifically except extralateral rights as described in 
     Section 4.B;
       The Exchange Properties conveyance shall furthermore be 
     specifically subject to:
       a. valid existing rights;
       b. the covenants described in Sections 4.C. and 4.D;
       c. the Net Island Receipts interest described in Section 6 
     and Exhibit C hereto; including but not limited to the right 
     of USFS to enter and inspect the Exchange Properties as 
     provided in Exhibit C hereto;
       d. a coextensive right of USFS to enter and inspect the 
     Exchange Properties to monitor compliance with Sections 4.B 
     and 4.C;
       The Exchange Properties conveyance shall be furthermore 
     subject only to any other exceptions, reservations, or 
     conditions approved prior to closing by KGCMC.
       B. The parties expressly agree that no extralateral rights 
     for the Exchange Properties shall be conveyed under the terms 
     of this Agreement. This Agreement shall not enlarge nor 
     diminish any extralateral rights which KGCMC may now have or 
     in the future establish with respect to its existing claims.
       C. The parties expressly agree that no minerals extracted 
     from the Exchange Properties other than hardrock and 
     metalliferous minerals available for location and patent 
     under the general mining laws of the United States (30 U.S.C. 
     21-53 et seq.) may be sold for commercial purposes. Any other 
     mineral or mineral material on the Exchange Properties may be 
     extracted and utilized by KGCMC in the exploration, 
     development, mining and beneficiation process of Existing 
     Claims and Exchange Properties for hard rock and 
     metalliferous minerals, without payment to the United States.
       D. Use and occupancy by KGCMC, its successors, or assigns 
     of the surface overlying the Exchange Properties shall be 
     limited as follows:
       (1) Use and occupancy of the surface estate overlying the 
     Exchange Properties shall be minimized to the maximum extent 
     practicable, including but not limited to consolidating 
     facilities and operations to the maximum extent practicable 
     with facilities and operations related to the existing Greens 
     Creek Mine, and reclamation in accordance with applicable law 
     and regulation.
       (2) There shall be no use or occupancy of the surface 
     estate overlying the Exchange Properties until the operator, 
     as defined in the regulations referenced herein, has applied 
     for and received approval of a plan of operations, including 
     reclamation, in accordance with the provisions of 36 CFR 
     228.80 and 36 CFR 228, Subpart A in effect on the effective 
     date of this Agreement.
       (3) There shall be no use or occupancy of the surface 
     estate overlying the Exchange Properties for purposes of
      open pit, hydraulic, or other surface mining, or smelting 
     operations.
       (4) Neither the existence of privately owned minerals nor 
     any provision of this Agreement shall be construed to 
     preclude the United States and its assigns, including the 
     general public, from occupancy or use of the surface estate 
     overlying the Exchange Properties. The USFS shall as 
     appropriate impose reasonable restrictions upon public 
     occupancy and use for purposes of avoiding conflict with 
     KGCMC operations, to protect public safety, or for other 
     purposes. This provisions shall not be construed to alter 
     respective tort liability, if any, between USFS and KGCMC or 
     other entities under applicable law.
       E. Evidence of title to Exchange Inholdings shall be in a 
     form acceptable to and in conformance with standards of the 
     Attorney General of the United States.
       F. USFS shall bear its own attorney fees, costs of document 
     preparation for conveyance of the Exchange Properties to 
     KGCMC, and costs of recording documents conveying Exchange 
     Inholdings and other property interests to the United States. 
     KGCMC shall bear all other closing costs, including abstract 
     of title or title insurance, transfer taxes, brokerage fees, 
     its attorney fees and recording costs. KGCMC shall also bear 
     the cost of survey required for issuance of patent to the 
     Exchange Properties and any survey required by the United 
     States to complete conveyance of any Exchange Inholdings to 
     the United States. Provided, if USFS completes the 
     acquisition of Exchange Inholdings pursuant to Section 
     4.A(i)(b), the USFS shall bear all closing costs for the 
     Exchange Inholdings. All costs borne by KGCMC pursuant to 
     this paragraph shall not be credited against the $1,000,000, 
     Net Island Receipts interest, or other consideration owing to 
     the United States under this Agreement. The provisions of 
     Public Law No. 91-646 shall not apply to this Agreement. 
     KGCMC shall not be construed as an agent of the United States 
     in acquiring Exchange Inholdings or otherwise under this 
     Agreement.
       G. The USFS agrees to cooperate with KGCMC in attempting to 
     effect the transactions contemplated herein as tax free 
     exchanges pursuant to Section 1031 of the I.R.C. (26 U.S.C. 
     1031 et seq.), but expressly disclaims any jurisdiction to 
     determine or influence Internal Revenue Service 
     determinations of the tax consequences of any transactions.
       5. Valuation of Exchange Inholdings
       A. Attached as Exhibit B of this Agreement is a list of the 
     properties which the USFS lists as qualified for conveyance 
     as Exchange Inholdings. KGCMC shall be permitted to acquire 
     and designate any such properties as Exchange Inholdings and 
     convey or cause to be conveyed to the USFS such properties as 
     is necessary to effect the Exchange. No particular lands are 
     required to be
      conveyed, and there is no priority for these potential 
     Exchange Inholdings except as described in Section C 
     below.
       B. The fair market value of each Exchange Inholding shall 
     be the lesser of the actual amount paid for the Inholding by 
     KGCMC, excluding closing costs borne by KGCMC described in 
     Section 4.E above, or the fair market value adjusted to the 
     effective date of this Agreement, determined by an appraisal. 
     The appraisal for each Exchange Inholding shall be completed 
     by KGCMC at its own expense and the appraisal report provided 
     to USFS no sooner than 1 year and no later than 60 days in 
     advance of closing for the Inholding concerned, for review 
     and approval. Said appraisal shall be completed according to 
     the then current Uniform Appraisal Standards for Federal Land 
     Acquisitions. In the event KGCMC is not able to acquire 
     Exchange Inholdings totalling exactly $1,000,000 in fair 
     market value, KGCMC shall be obligated without further 
     consideration to convey and bear the expense of acquiring any 
     additional Exchange Inholding required to bring the total 
     fair market value of the Exchange Inholdings conveyed to at 
     least $1,000,000.
       C. Exhibit B is divided into two parts: Part A lists lands 
     located within Admiralty Island National Monument. Part B 
     lists lands located within other Conservation System Units 
     within the Tongass National Forest. KGCMC shall use 
     reasonable efforts to acquire lands from the Part A list when 
     available at fair market value and only acquire lands from 
     the Part B list upon a determination by the USFS that lands 
     from the Part A list are not available at fair market value 
     after such reasonable efforts. KGCMC shall otherwise consult 
     and cooperate with USFS in identifying opportunities of 
     acquisition at fair market value of particular lands listed 
     in Exhibit B, and use reasonable efforts to acquire such 
     lands.
       6. Net Island Receipts Royalty Interest--The Parties agree 
     that the United States shall receive a percentage of the Net 
     Island Receipts from mineral production from the Exchange 
     Properties as described in Exhibit C of this Agreement. The 
     United States shall be provided reasonable access by KGCMC to 
     the Exchange Properties and any books, records, documents, 
     and mineral samples, to audit the payment of the Net Island 
     Receipts interest as provided in Exhibit C.
       7. Existing Extralateral Rights--This Agreement, including 
     the grant of the Net Island Receipts interest described in 
     paragraph 6 and Exhibit C shall not enlarge or diminish any 
     rights KGCMC may now have or in the future establish to 
     minerals lying with the Exchange Properties through 
     application of extralateral rights extending from KGCMC's 
     Existing Claims. The Net Island Receipts interest to be 
     granted to the United States under this agreement shall not 
     burden, nor entitle the United States to any monies realized 
     by KGCMC from the sale of concentrates or other mineral 
     products from ores, the title to which belongs to KGCMC by
      operation of extralateral rights extending from KGCMC's 
     existing claims and property interests.
       8. Restrictive Covenant and Future Interest in the United 
     States.
       A. KGCMC shall grant the United States a restrictive 
     covenant and future interest in (i) the Existing Claims; (ii) 
     Millsite #1 (MS 2514); and (iii) the Exchange Properties, and 
     the right to a future interest in (iv) the ``Future Acquired 
     Lands,'' defined as follows: any lands on Admiralty Island to 
     which KGCMC, its successors, or assigns acquires title after 
     the effective date of this agreement and prior to the vesting 
     of title in the United States as defined in Section 8.B. 
     occurs, excepting Exchange Inholdings conveyed to the United 
     States pursuant to this Agreement. The grant shall be 
     effected by: (1) a conveyance by deed regarding the Existing 
     Claims and Millsite; (ii) a reservation and/or exception in 
     the conveyance from the [[Page H4922]] United States 
     regarding the Exchange Properties; and (iii) a contractual 
     right to conveyance by deed upon KGCMC acquiring title, 
     regarding the Future Acquired Lands. KGCMC shall grant the 
     restrictive covenant and future interest and rights thereto 
     described herein at the exchange closing.
       B. The terms of the restrictive covenant and future 
     interest to be granted to the United States in Section 8.A. 
     are as follows:
       (1) Restrictive Covenant: Use of the subject lands by 
     KGCMC, its successors, and assigns shall be limited solely to 
     bona fide good faith mineral exploration, development, and 
     production activities, including reclamation work. This 
     covenant shall run with the land until such time as the 
     vesting of title to the United States occurs.
       (2) Future interest: Right of Reentry: The United States 
     shall have a right to reenter and take title and possession 
     to all right, title, and interest in the subject lands upon 
     the following, whichever occurs earlier:
       (a) abandonment by KGCMC, its successors, or assigns, of 
     all bona fide good faith mineral exploration, development, 
     and production activities, including reclamation work, on 
     each and all of i) the Existing Claims; ii) Millsite #1 (MS 
     2514); iii) the Exchange Properties; and iv) the Future 
     Acquired Lands. Complete cessation for ten consecutive years 
     of all bona fide good faith mineral exploration, development, 
     and production activities, including reclamation work, on all 
     the lands listed in i) through iv) herein, shall be 
     conclusively deemed to constitute abandonment, without 
     prejudice to abandonment occurring otherwise.
       (b) January 1, 2045; if as of December 1, 2044, KGCMC, its 
     successors, or assigns are not engaged in bona fide
      good faith mineral exploration, production, or production 
     activities, including reclamation work, on any of the 
     lands listed in (i) through (iv) in (a) above.
       (c) January 1, 2095, irrespective of any ongoing activities 
     and subject to the right of reentry occurring sooner based 
     upon abandonment as described in (a) above.
       The right of reentry and all other terms herein shall not 
     in any way relieve KGCMC, its successors, or assigns of 
     obligations described in Section 9 [indemnity] of other 
     obligation otherwise applicable.
       9. Hazardous Waste and other Indemnity. KGCMC, Kennecott 
     Corporation, and their successors and assigns shall 
     indemnify, defend and hold harmless the United States, its 
     various agencies and employees, from any damage, loss, claim, 
     fines, penalties, and costs whatsoever arising in any way and 
     at any time from any use, occupancy or activities, past, 
     present or future (provided said use, occupancy, or 
     activities occur no later than the time at which title 
     reverts to the United States), by any entity, on the Exchange 
     Inholdings, Existing Claims, Millsite #1 (MS 2514) and other 
     property in which a restrictive covenant and future interest 
     is granted to the United States under this Agreement, 
     specifically including, but not limited to: (a) those 
     activities by which hazardous substances, hazardous 
     materials, or wastes of any kind were generated, released, 
     stored, used, or otherwise disposed on the described property 
     or facility thereon, and (b) any response or natural resource 
     damage actions conducted pursuant to any federal, state, or 
     local environmental law, regulation, or rule, and related in 
     any manner to said hazardous substances, hazardous materials, 
     or wastes.
       10. Disclaimer of Value Warranty. The parties expressly 
     disclaim any warranty of value for any of the lands or 
     interests exchanged under this Agreement. It is expressly 
     recognized by the parties that potential revenues or proceeds 
     from any of the lands or interests exchanged herein are 
     purely speculative.
       11. Loss or Damage Prior to Conveyance. Both parties agree 
     not to do, or suffer others to do, any act prior to the 
     conveyance described in this Agreement by which the value of 
     the real property herein identified for exchange may be 
     diminished or further encumbered. In the event any such loss 
     or damage occurs from any cause, including acts of God, to 
     the real property herein identified for exchange before 
     execution of deed, the party who is grantee under this 
     Agreement as to that property shall not be obligated to 
     accept title to said property, and an equitable adjustment in 
     the consideration shall be made at the option of said party. 
     Information obtained from exploratory drilling or other acts 
     otherwise authorized shall not be construed as diminishing or 
     further encumbering the identified property, for purposes of 
     this Agreement.
       12. Status Quo Ante. In the event this Agreement becomes 
     null and void prior to the completion of the exchange closing 
     by operation of its terms or by order of a court of competent 
     jurisdiction, the parties shall return to their status and 
     rights prior to execution of the Agreement.
       13. Notices--Notices required to be delivered under this 
     Agreement shall be delivered in writing by U.S. mail, hand 
     delivery with return receipt, or fax with confirmation as 
     follows:
     KGCMC
     ______________________________
     General Manager
     Kennecott Greens Creek Mining Co.
     3000 Vintage Park Road
     Juneau, Alaska 99801

     ______________________________
     General Counsel
     Kennecott Corporation
     10 East South Temple
     Salt Lake City, Utah 84113
     U.S. Forest Service
     ______________________________
     Regional Forester
     Region 10
     P.O. Box 21628
     Juneau, Alaska 99802-1628
       14. Signatures for Execution. The signers shall be: (i) for 
     Kennecott Corporation and Kennecott Greens Creek Mining 
     Company, respectively, the authorized officer for the 
     Corporation and for the Company; and (ii) for the United 
     States of America, Department of Agriculture, Forest Service, 
     the USDA Assistant Secretary for Natural Resources and 
     Environment.
       15. Counterparts. This Agreement may be signed in separate 
     counterparts by the parties which, when each have so signed, 
     shall be deemed a single Agreement.
       16. Entirety of Agreement. This instrument and attachments 
     embody the whole Agreement of the parties. The Exhibits 
     referenced herein are attached hereto and incorporated by 
     reference as part of this Agreement. There are no promises, 
     terms, conditions, or obligations other that those contained 
     herein. This Agreement shall supersede all previous 
     communications, representations, or agreements, either verbal 
     or written, between the parties.
       17. Modification. This Agreement may be modified only upon 
     written Agreement of the parties thereto and after 
     notification in writing to the appropriate committees of the 
     U.S. Congress.
       18. Clerical and Typographical Errors. Clerical and 
     typographical errors contained herein may be corrected upon 
     notice to the Parties. Unless such errors are deemed 
     substantive by either party within ten (10) days notice, 
     corrections may be made without formal ratification by the 
     Parties. In the event the delineation of a boundary upon a 
     map included in an exhibit to this Agreement conflicts with a 
     textual description of the boundary included in the exhibit, 
     the map boundary shall control, subject to correction of 
     errors in map boundaries under this section.
       19. Covenant Not to Sue. The parties to this Agreement 
     mutually covenant not to sue each other challenging the legal 
     authority of either to enter into their Agreement or to 
     effectuate any terms herein. Either party may enforce the 
     covenants, terms, and conditions of this Agreement in a court 
     of competent jurisdiction.
       20. Officials Not to Benefit. No Member of Congress or 
     Resident Commissioner shall be admitted to any share or part 
     of this Agreement or to any benefit that may arise therefrom 
     unless it is made with a corporation for its general benefit 
     (18 U.S.C. 431, 433).
       Third Party Beneficiaries. This agreement is not intended, 
     and shall not be construed, to create any third party 
     beneficiary. Nothing in this Agreement shall be construed as 
     creating any rights of enforcement by any person or entity 
     that is not a party to this Agreement.
       Successors and Assigns.
       A. This Agreement shall be effective and binding upon each 
     party and any successors or assigns thereto. The parties 
     shall have the right to assign, transfer, convey, lease, sell 
     or alienate any of their rights under this Agreement. The 
     Parties further acknowledge that a transfer from KGCMC to 
     Greens Creek Joint Venture, operating as a joint venture, is 
     expressly permissible upon written notice to the USFS. An 
     assignment, transfer conveyance, lease, sale or other 
     alienation of rights, however, shall not release a party from 
     its duties under this Agreement, except that an agency of the 
     United States shall be released from its duties if the 
     transfer is to a successor agency.
       B. An assignment, transfer, conveyance, lease, sale or 
     alienation shall not release any of the covenants or 
     conditions which run with the land imposed by this Agreement. 
     The covenants and conditions contained in this Agreement 
     shall be construed as running with the land unless they are 
     clearly intended as personal to a party to this Agreement. 
     The parties may contract for the disposition or utilization 
     of any rights granted by this Agreement.
       23. Equal Value and Public Interest Determination. The 
     Parties recognize the impossibility of precisely valuing the 
     respective considerations flowing between the United States 
     and GCJV pursuant to this Agreement. In accordance with 
     Section 1302(h) of ANILCA, the USFS Regional Forester, Region 
     10, pursuant to authority delegated by the Secretary of 
     Agriculture, has determined that although the mutual 
     consideration flowing between the Parties may be unequal, it 
     is in the public interest to consummate this exchange. This 
     paragraph shall be construed as a finding by the Secretary 
     that the public interest values of the interests in land 
     exchanged pursuant hereto are equal.
       In Witness Whereof, Kennecott Corporation, Kennecott Greens 
     Creek Mining Company, and the USDA Assistant Secretary for 
     Natural Resources and Environment, acting for and on behalf 
     of the United States Department of Agriculture, has executed 
     this Agreement.

     United States Department of Agriculture
     By: ____________________
     Assistant Secretary for Natural Resources and Environment
     Date: ____________________

     Kennecott Greens Creek Mining Company
     By: ____________________ [[Page H4923]] 
     Its: ____________________
     Date: ____________________

     Kennecott Corporation
     By: ____________________
     Its: ____________________
     Date: ____________________
                           Exhibit B--Part A

      KGCMC EXCHANGE INHOLDINGS--ADMIRALTY ISLAND NATIONAL MONUMENT     
------------------------------------------------------------------------
                                                      Legal        USGS 
         Tract              Acres      Location    description     quad 
------------------------------------------------------------------------
USS 796................      7.88    Wheeler      T44S, R65E,    JUN A- 
                                      Creek.       CRM.           3.    
(406906)                                                                
USS 1058...............     54.04    Hood Bay...  T52S, R68E,    SIT B- 
                                                   CRM.           2.    
USS 1159...............     71.47    Wheeler      T44S, R65E,    JUN A- 
                                      Creek.       CRM.           3.    
(938822) (Homestead Entry No. 85)                                       
Fraction of HES 85 totaling approx. 22 acres subdivided as:             
  Tract A..............      4.965                               .......
  Tract B..............      4.965                               .......
  Tract C..............      4.965                               .......
  Tract D east part....      0.366                               .......
  Tract D west part....      1.5                                 .......
  Tract E Lot 1........      2.48                                .......
  Tract E Lot 2........      2.48                                .......
Fraction of HES 85 totaling approx. 16 acres                            
Fraction of HES 85 totaling approx. 33 acres                            
USS 1351...............    134.53    Mole Harbor  T49S, R70E,    SIT C- 
                                                   CRM.           1.    
  Tract A..............      3.44                                .......
  Tract B..............    131.09                                .......
USS 1480...............     10.24    Hood Bay...  T52S, R69E,    SIT B- 
                                                   Sec7.          2.    
(T&M Pat. 1027446)                                                      
USS 1575...............     14.63    Gambier Bay  T51S, R71E,    SUM B- 
                                                   CRM.           6.    
  Tract A..............      3.905                               .......
  Tract B..............      4.069                               .......
  Tract C..............      2.544                               .......
  Tract D..............      2.239                               .......
  Tract E..............      1.875                               .......
USS 1984...............     32.59    Pybus Bay..  T53S, R71E,    SIT B- 
                                                   CRM..          1.    
(1061484)                                                               
  Parcel 1&2...........     21.50                                .......
  Parcel 3.............     11.09                                .......
USS 2412:                                                               
  Lot 16...............      3.51    Hood Bay...  T52S, R68E,    SIT B- 
                                                   Sec12.         2.    
  Tract A..............      1.981                               .......
  Tract B & C..........      1.528                               .......
USS 2412:                                                               
  Lot 21...............      4.55    Hood Bay...  T52S, R68E,    SIT B- 
                                                   Sec12.         2.    
  (Homesite Pat. 1126506)                                               
  Lot 23...............      5.00    Hood Bay...  T52S, R68E,    SIT B- 
                                                   Sec12.         2.    
  (Homesite Pat. 1130390)                                               
USS 2413:                                                               
  Lot 28...............      3.90    Hood Bay...  T52S, R69E,    SIT B- 
                                                   CRM.           2.    
  Lots 30-37...........     23.1     Hood Bay...  T52S, R69E,    SIT B- 
                                                   CRM.           2.    
  (PLO 774)                                                             
  PLO's 593, 774, 5156 & 5188 totaling:                                 
                           612.63    Hood Bay...  T52S, R68E,    SIT B- 
                                                   CRM T52S,      2.    
                                                   R69E, Sec 7.         
USS 10438:                                                              
  Lot 1................      3.98    Hood Bay...  T52S, R68E,    SIT B- 
                                                   CRM.           2.    
  Lot 2................     22.59    Hood Bay...  T52S, R68E,    SIT B- 
                                                   CRM.           2.    
USS 10444..............    100.0     Hood Bay...  T52S, R68E,    SIT B- 
                                                   CRM.           2.    
USS 10459..............     60.0     Chaik Bay..  T52S, R69E,    SIT B- 
                                                   CRM.           2.    
MS 312.................    132.67    Kanalku Bay  T50S, R68E,    SIT B- 
                                                   CRM.           2.    
MS 1032................     82.28    Greens       T43S, R66E,    JUN A- 
                                      Creek.       CRM.           2.    
                                                  Sec. 31 & 32.  JUN A- 
                                                                  3.    
1152018................     18.00    Murder Cove  T56S, R68E,    SIT A- 
                                                   CRM.           2.    
  Fraction.............     16.00                                .......
  Fraction.............      2.00                                .......
AA-7741................    158.04    Mitchell     T50S, R68E,    SIT C- 
                                      Bay.         SEC 12.        2.    
Native Allot.                                                           
Patent No. 50-93-0148                                                   
Native Allot...........    104.48    Favorite     T51S, R68E...  SIT B- 
                                      Bay.                        2.    
------------------------------------------------------------------------

       The above list of private holdings within Admiralty Island 
     National Monument are considered desirable for acquisition. 
     Data is from the USDA Forest Service, R-10 data files and 
     State of Alaska, Juneau District Recorders Office. The 
     listing is considered to be approximately 95% complete as of 
     the date of this agreement. Parcels to be considered under 
     this exchange shall also include holdings conveyed into 
     private ownership subsequent to the date of this agreement. 
     The parcels are listed in numerical order without any regard 
     as to priority or availability for acquisition.
                           Exhibit B--Part B

       KGCMC EXCHANGE INHOLDINGS--OTHER CONSERVATION SYSTEM UNITS       
------------------------------------------------------------------------
             Tract                Acres                                 
------------------------------------------------------------------------
Misty Fiords National Monument/Wilderness:                              
  MS 2267.....................     647.12  .............................
  USS 1663....................      10.08  .............................
  USS 1980....................      14.00  .............................
  USS 287.....................      34.53  .............................
  USS 1342....................       5.00  .............................
  USS 2975....................      79.87  .............................
  USS 2662....................       4.96  .............................
  USS 2667....................      84.07  .............................
  USS 1445....................      65.25  .............................
  USS 2629....................      28.13  .............................
  USS 2320....................     116.77  .............................
  USS 2740....................     124.19  .............................
  IC 1072.....................      12.75  .............................
  IC 1424.....................      11.40  .............................
  IC 1188.....................      19.20  .............................
  IC 929......................       4.65  .............................
                               -----------                              
    Subtotal..................   1,261.87  .............................
South Prince of Wales Wilderness:                                       
  USS 310.....................      13.75  .............................
  IC 1107.....................      33.20  .............................
  IC 1115.....................       3.10  .............................
                               -----------                              
    Subtotal..................      50.05  .............................
Peterson Creek/Duncan Salt Chuck Wilderness:                            
  MS 652......................      78.16  .............................
  USS 310.....................       7.75  .............................
                               -----------                              
    Subtotal..................      85.91  .............................
Stikine-LaConte Wilderness:                                             
  USS 1023....................     160.00  .............................
  USS 2358....................       4.93  .............................
  Pat'd Land..................     159.63  Lot 172, W1/2NW, N1/2NWSE, S-
                                            26, T60S, R82E.             
  Pat'd Land..................     151.35  S1/2/2NWSE, W1/2SWSE, Lots   
                                            374, S-26; N1/2NENW, S-35,  
                                            T60S, R82E.                 
  Pat'd Land..................     141.65  Lots 1 & 3, S1/2SENE, S-31;  
                                            Lot 4, S1/2SWNW, S-32, T60S,
                                            R82E.                       
  Pat'd Land..................     135.39  Section 11, T61S, R83E.      
  Pat'd Land..................     114.38  Section 14, T61S, R83E.      
  Pat'd Land..................     157.76  Section 2, T61S, R83E;       
                                            Section 31, T60S, R83E.     
                               -----------                              
    Subtotal..................   1,025.09  .............................
West-Chichagof/Yakobi Wilderness:                                       
  MS 2257.....................      15.00  .............................
  MS 1574.....................     201.64  .............................
  MS 965A.....................      39.96  .............................
  MS 1587.....................      32.84  .............................
  MS 1046 & 1453..............      35.79  .............................
  MS 1046.....................       7.35  .............................
  MS 1460.....................      33.53  .............................
  MS 936......................      23.56  .............................
  MS 1047.....................      13.75  .............................
  MS 864......................      42.82  .............................
  MS 1576.....................      12.34  .............................
  MS 1575.....................      12.62  .............................
  MS 1461.....................       4.77  .............................
  MS 1594.....................      35.39  .............................
  MS 1498.....................      16.66  .............................
  MS 1502 A & B...............     162.42  .............................
  MS 1504.....................      19.81  .............................
  MS 957A.....................      13.38  .............................
  MS 1497.....................       1.17  .............................
  USS 1476....................      12.70  .............................
                               -----------                              
    Subtotal..................     737.50  .............................
Chuck River Wilderness:                                                 
  MS 791......................      35.43  .............................
  MS 964......................      55.02  .............................
  MS 42.......................       9.87  .............................
[[Page H4924]]
                                                                        
  MS 1085.....................      62.47  .............................
  MS 577......................     154.46  .............................
  MS 37, 38 & 39..............      55.45  .............................
  USS 1509....................      40.22  .............................
  USS 1940....................      37.66  .............................
  USS 3082....................       4.51  .............................
  MS 424......................      12.96  .............................
  MS 525A.....................      25.55  .............................
  MS 267 A & B; 268 A & B;          63.98  .............................
   269; 270.                                                            
  MS 579 A & B................     111.85  .............................
  MS 40 & 41..................      28.00  .............................
  USS 2845....................       3.78  .............................
                               -----------                              
    Subtotal..................     701.21  .............................
------------------------------------------------------------------------

     The above list of private holdings within Conservation 
     System Units on the Tongass National Forest are considered 
     desirable for acquisition. Data is from the USDA Forest 
     Service, R-10 data files and State of Alaska, Juneau District 
     Recorders Office. The listing is considered to be 
     approximately 95% complete as of the date of this agreement. 
     Parcels to be considered under this exchange shall also 
     include holdings conveyed into private ownership subsequent 
     to the date of this agreement. The parcels are listed in 
     random order without any regard as to priority or 
     availability for acquisition.
                 Exhibit C--Net Island Receipts Royalty


                  a. definition of net island receipts

       ``Net Island Receipts (NIR)'' shall be any excess of 
     ``Revenues Received (RR)'' over ``Allowable Deductions (AD)'' 
     for any calendar year. Net Island Receipts shall be 
     calculated using the following formula: NIR = RR - AD.
       Where:
       NIR = Net Island Receipts for the calendar year (in 
     dollars);
       RR = Revenues received during the calendar year, as defined 
     in Section D. below (in dollars);
       AD = Allowable deductions incurred during the calendar 
     year, as defined in Section D. below (in dollars);


                         b. royalty calculation

       The dollar amount of the royalty payable to the Interest 
     Holder shall be calculated using the following formula: 
     Royalty = (X) (NIR).
       Where (X) = three percent (3%) of NIR when NIR exceeds 
     $120/ton, and three-fourths of one percent (0.75%) when NIR 
     is equal to or less than $120/ton. Provided, the $120/ton 
     threshold shall be adjusted annually according to the Gross 
     Domestic Product Implicit Price Deflator, until the sooner of 
     the following dates, whichever occurs earlier:
       (1) the date 20 years subsequent to the date upon which 
     mining operations commence at the Greens Creek Mine, whether 
     or not operations include the Exchange Properties; or
       (2) the date 30 years subsequent to the effective date of 
     the Agreement.


                         c. payments of royalty

       The payor shall deliver to the Interest Holder a payment 
     equal to the percentage, as set forth in section B. above, of 
     all NIR realized by the Payor during any calendar year 
     (January 1-December 31), within thirty days after the end of 
     said calendar year, together with a copy of the accounting 
     made in connection with such payment. All payments of royalty 
     to the Interest Holder shall be subject to adjustment, 
     including interest on any such adjustment at the rate 
     provided by 31 U.S.C. 3717, on March 31.
                          D. Other Definitions

       1. ``Exchange Properties'' shall mean the ``Exchange 
     Properties'' described by Exhibit A of the Agreement.
       2. ``Payor'' shall mean KGCMC, its successors and assigns.
       3. ``Interest Holder'' shall mean United States of America, 
     pursuant to the terms of the Agreement.
       4. ``Revenues Received (RR)'' shall mean the payments 
     received or credited from the sale of ores or products 
     produced from ores mined from the Exchange Properties at the 
     point of sale before subtracting the Allowable Deductions 
     (AD). Sales to affiliates of KGCMC shall be valued at the 
     fair market value of the products sold. Any credits or 
     payments received from a buyer by KGCMC shall be credited as 
     RR.
       5. ``Allowable Deductions'' shall mean the following actual 
     costs incurred by Payor: costs of all transportation and 
     insurance for ores or products produced from ores mined from 
     the Exchange Properties, between KGCMC Admiralty Island 
     loading facilities and the point of delivery of said ores or 
     products, smelting and/or refining charges, treatment 
     charges, penalties, umpire charges, independent 
     representative charges and all charges by purchasers of said 
     ores or products.


                         E. Accounting Matters

       All Revenues Received (RR) and Allowable Deductions (AD) 
     shall be determined in accordance with generally accepted 
     accounting principles and practices consistently applied. RR 
     and AD shall be determined by the accrual method.


                     F. Costs of Common Facilities

       Where any AD are incurred in conjunction with like costs 
     for mineral products from other Properties controlled by the 
     Payor, such costs shall be fairly allocated and apportioned 
     in accordance with generally accepted practices in the mining 
     industry.


                         G. Audit and Disputes

       1. The Interest Holder, upon written notice, shall have the 
     right to have an independent firm of certified public 
     accountants or utilize its own personnel at its own cost to 
     audit the records that relate to the calculation of the NIR 
     royalty within 24 months after receipt of a payment described 
     in Section C of this Exhibit.
       2. The Interest Holder shall be deemed to have waived any 
     right it may have had to object to a payment made for any 
     calender year, unless it provides notice in writing of such 
     objection within 25 months after receipt of final payment for 
     the calendar year. The parties may elect to submit the 
     dispute to a mutually acceptable certified public accountant, 
     or firm of certified public accountants, for a binding 
     resolution thereof.
                               h. general

       1. Unless otherwise specified, capitalized terms used 
     herein shall have the same meaning as given to them in the 
     Agreement.
       2. Accurate records of tonnage, volume of products, 
     analyses of products, weight, moisture, assays of pay metal 
     content and other records related to the computation of the 
     NIR royalty hereunder shall be kept by the Payor.
       3. Up to four times per year, the Interest Holder or its 
     authorized representative on not less than five (5) business 
     days written notice to the Payor, may enter upon all portions 
     of the Exchange Properties for the purpose of inspecting the 
     Exchange Properties, all improvements thereto and operations 
     thereon, and may inspect and copy all records and data 
     pertaining to the computation of the NIR royalty, including 
     without limitation such records and data which are maintained 
     electronically. The Interest Holder or its authorized 
     representative in exercising entry and inspection rights may 
     not unreasonably hinder operations on or pertaining to the 
     Exchange Properties. This provision does not diminish any 
     other independent right which the Interest Holder may have to 
     enter and inspect Payor's properties, records or data.
       4. All notices or communications hereunder shall be made 
     and effective in accordance with the provisions of the 
     Agreement.
       5. The NIR royalty interest shall be a real property 
     interest that runs with the Exchange Properties and shall be 
     applicable to any person who processes and sells products 
     from the Exchange Properties.
       6. All information and data provided to the Interest holder 
     shall be treated as confidential by the USFS and disclosed to 
     other parties only to the extent, if any, required by law.
       7. The Payor shall have the right to commingle ore and 
     minerals from the Exchange Properties with ore from other 
     lands and properties; provided, however, that the Payor shall 
     calculate from representative samples the average grade of 
     the ore and shall weigh (or calculate by volume) the ore 
     before commingling. If concentrates are produced from the 
     commingled ores by the Payor, the Payor shall also calculate 
     from representative samples the average recovery percentage 
     for all concentrates produced during the calendar year. In 
     obtaining representative samples, calculating the average 
     grade of the ore, and calculating average recovery 
     percentages the Payor shall use procedures accepted in the 
     mining and metallurgical industry suitable for the type of 
     mining and processing activity being conducted.

  Mr. Speaker, I reserve the balance of my time.
  Mr. ABERCROMBIE. Mr. Speaker, I yield myself such time as I may 
consume.
  (Mr. ABERCOMBIE asked and was given permission to revise and extend 
his remarks.)
  Mr. ABERCROMBIE. Mr. Speaker, good morning and aloha, and good 
morning and aloha to my good friend and most excellent chairman, the 
gentleman from Alaska [Mr. Young].
  Both the chairman, the gentleman from Alaska [Mr. Young], and the 
ranking member, the gentleman from California [Mr. Miller], introduced 
this bill, a hallmark of bipartisan cooperation dearly to be cherished 
and assiduously sought afdter in legislation to come. In my view, Mr. 
Speaker, and in the view of the gentleman from California [Mr. Miller], 
H.R. 1266 provides for a beneficial resolution, both for the economy 
and the environment of southeast Alaska.
  Mr. Speaker, the Committee on Resources has a long history of concern 
for the management of Admiralty Island National Monument.

                              {time}  1230

  While the wilderness and wildlife values of Admiralty Island are very 
special, responsible operation of the Greens Creek Mine is not 
necessarily compatible with the conservation purposes for which the 
monument was established. This legislation would allow Greens Creek to 
explore 7,500 acres of nonwilderness lands adjacent to the existing 
mine, allowing mine operations to expand with relatively little surface 
disturbance.
  By virtue of the agreement negotiated between the Forest Service and 
Kennecott, the environment will benefit both in the short term through 
$1.1 [[Page H4925]] million of land acquisition from willing sellers, 
and in the long term when mining operations cease and the lands revert 
back to the Forest Service.
  In addition, the bill creates a land acquisition account to be funded 
by the first $5 million of royalties collected for further land 
purchases in the Tongass National Forest, with priority to non-Federal 
lands within the national monument.
  Pursuant to the terms of the agreement, if Greens Creek fails to 
purchase and deliver title to $1.1 million worth of lands acceptable to 
the Forest Service, the land exchange will not be consummated.
  Mr. Speaker, it is important to consider this agreement in the 
context of efforts to reform the mining law of 1872. The notion that 
those of us who favor modernizing the mining laws are opposed to the 
mining industry in this country is simply false. My support of this 
legislation, which is likely to significantly enhance the economics and 
life of the Greens Creek Mine, should put that falsehood to rest.
  This legislation does set an important precedent that the Government 
should receive a royalty share for the development of public lands. At 
the same time, I do not consider the 3-percent net royalty negotiated 
in this agreement as universally applicable for purposes of mining 
reform.
  I recognize there were concessions from both sides in the negotiating 
process and I am reluctant to rewrite the deal. On balance, however, I 
applaud both Kennecott and the Forest Service for their efforts, and I 
ask Members to support the bill.
  May I add personally, Mr. Speaker, again my congratulations to the 
gentleman from Alaska [Mr. Young]. the chairman, and the appreciation 
of all the members on the minority side for his openness and, as 
always, his willingness to be cooperative with us.
  With that, Mr. Speaker, I reserve the balance of my time.
  Mr. YOUNG of Alaska. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I could only echo what the gentleman just said. There is 
a way we can work on many of these issues and solve the problem if we 
seek to do so.
  The gentleman from Hawaii has always been able to work with me on his 
issues especially in his great State. We have a great deal in common. 
We hope to solve some of his problems with the Hawaiian natives which 
we have also solved in Alaska. I do compliment him.
  I may suggest to the gentleman from California [Mr. Miller], the 
ranking member, we ought to let the gentleman from Hawaii [Mr. 
Abercrombie] manage these bills more often.
  Mr. Speaker, I have no further requests for time, and I yield back 
the balance of my time.
  Mr. ABERCROMBIE. Mr. Speaker, I have no further requests for time, 
and I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Funderburk). The question is on the 
motion offered by the gentleman from Alaska [Mr. Young] that the House 
suspend the rules and pass the bill, H.R. 1266, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.
  

                          ____________________