Henry Gets a Mountain

Henry J. Kaiser's chief worries as a steelmaker have been over iron ore for his plant at Fontana, Calif. This week Kaiser felt that these worries were ended. After more than two years of haggling he had acquired mining rights to famed Eagle Mountain, best source of ore in the West.

Kaiser has been hauling most of his ore 185 miles from low-grade diggings at Kelso, Calif., the rest 500 miles from Cedar City, Utah. Eagle Mountain, rising naked on the edge of the Mojave Desert, is only 153 miles from Fontana, is rich enough to supply Kaiser with low-cost, high-grade ore for at least 50 years.

In 1943 Kaiser bought title to Eagle Mountain from the Southern Pacific railroad for $1,000,000. But it was encumbered by a lease on the iron deposits held by Edward T. Foley, closemouthed, hard-driving contractor who does a world-wide construction business from a side-street office in Pasadena.

To get ore, Kaiser had to buy it from Foley. Ed Foley, who knew he had a good thing, finally forced Kaiser to pay "in excess of $1,000,000" for the lease.

The cash comes from Kaiser's shipbuilding and Fontana earnings, with an O.K. from the Reconstruction Finance Corp. RFC figured that better earning prospects for Fontana meant a better prospect for repayment of the $115 million RFC loan on it.

Fontana's production record is excellent on quantity, bad on cost. Example: In 1944 pig iron cost Fontana $24.50 a ton v. $17.42 for the government-owned Geneva plant. Since then Kaiser has lowered his costs. With Eagle Mountain, Kaiser expects to quote steel-hungry Pacific Coast industries new low steel prices, but steelmen will wait & see. The mine won't be in full production for at least six months, and even then ore will have to be trucked 50 miles to the Southern Pacific tracks at Indio.

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