Eldorado: Canada's National Uranium Company 9781442674332

Table of contents :
Contents
Foreword
Acknowledgments
Prologue
1. The Canadian Shield
2. Northern Lights
Interlude: The Powers of the Atom
3. From Radium to Uranium
4. Private into Public
Interlude: War into Cold War
5. The Shadow of War
6. Mines and Money
Interlude: Searching for Security
7. Stoking a Boom: The Search for a Just Price
8. Beaverlodge and the Boom
9. Beaverlodge and the Boom: II
10. Getting There Is Half the Fun
Interlude: Atoms for Peace
11. The Politics of Peace
12. Too Little, Too Soon
Notes
Index

Citation preview

Eldorado

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Robert Bothwell

Eldorado CANADA'S NATIONAL URANIUM COMPANY

U N I V E R S I T Y OF TORONTO PRESS Toronto Buffalo London

www.utppublishing.com University of Toronto Press 1984 Toronto Buffalo London Printed in Canada ISBN 0-8020-3414-4

Canadian Cataloguing in Publication Data Both well, Robert, 1944— Eldorado: Canada's national uranium company Includes bibliographical references and index. ISBN 0-8020-3414-4 i. Eldorado Nuclear Limited — History. 2. Uranium mines and mining — Canada - History. I. Title. HD9539.U73E58 1984 338.7'62234932 0:84-098943-1

To the memory of Pauline Bothwell,

IQ^-^SS

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Contents

FOREWORD / ix ACKNOWLEDGMENTS / xi

Prologue / 3 i The Canadian Shield I 10 2 Northern Lights I 39 Interlude: The Powers of the Atom / 79 3 From Radium to Uranium I 92 4 Private into Public I 117 Interlude: War into Cold War / 155 5 The Shadow of War I 164 6 Mines and Money I 198 Interlude: Searching for Security / 233 7 Stoking a Boom: The Search for a Just Price I 239 8 Beaverlodge and the Boom I 277 9 Beaverlodge and the Boom: n / 315 10 Getting There Is Half the Fun I 351 Interlude: Atoms for Peace / 377 11 The Politics of Peace I 383 12 Too Little, Too Soon I 412 NOTES/437 INDEX / 463

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Foreword

During the first half of this century, Eldorado played an interesting role in Canada's history. The company was heavily involved in the evolution of resource policy, federal/provincial relations, the role of crown corporations, and the medical, military, and energy applications of radioactive minerals. It had to deal with the gap between the private and public sectors, bilateral and multilateral foreign policies, and many other areas of public administration. All this, in addition to pioneering in mineral prospecting, northern transportation, and uranium mining and processing. Until the entry of other companies into the uranium business in the 19505, Eldorado was unique in both Canadian business and Canadian politics. Today, Eldorado is one of many resource companies operating in Canada's north, one of many uranium producers that supply uranium solely as a fuel for use in the generation of electricity. The company's reputation now rests on its ability to operate and compete in a highly commercial environment. Eldorado recognized several years ago that its early history should be published. Our objective was to bring to the task the discipline of recognized scholarship, and the choice of Dr Robert Bothwell and the University of Toronto Press to document events came naturally. Dr Bothwell has special insights into the period covered by the book, having devoted most of his academic career to studying the evolution of Canadian public policy during the first

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Foreword

half of the twentieth century. In particular, his published works on the life and times of C.D. Howe, a central figure in Eldorado's past, have been widely acclaimed. Government documents that cover this period have been increasingly available, and they have been an essential part of Dr Bothwell's work. However, much of the company's history resides in the memories of those people who helped shape events. Eldorado is grateful to them for the many hours they have devoted to the research of this work. In this book, Dr Bothwell has captured the excitement of frontier resource development and traced the evolution of relevant public policy and its administration. But foremost, he has documented for the first time a period in the history of an interesting corporation — to be judged by readers in the context of the issues, the events, and the values of that era. N.M.EDIGER

Chief Executive Officer Eldorado Nuclear Limited Ottawa, Ontario May 1984

Acknowledgments

This book was written with the encouragement and support of Eldorado Nuclear Limited, which sponsored the research and patiently endured the peculiarities of keeping a historian on or about its premises for three years, from 1981 to 1984. Eldorado was a hospitable host, and its support made the writing of this book faster and easier than it could otherwise have been. In return for its support, Eldorado asked for the right to read and comment upon the manuscript and its various stages. The company did not ask for the right to remove any passage it found objectionable, or to alter the book in any way. Its readers, Dave Smith and Sandy Mackay-Smith, maintained an unwavering optimism even in the face of this book's first draft. To Bill Bennett, Eldorado's longest-serving board member, I owe particular thanks for shepherding me to meetings with old colleagues and friends in Canada and the United States, and for patiently reading and commenting on the various drafts of this book. My friends John English, Ian Drummond, and Norman Hillmer also read various parts of the book and contributed valuable criticism and advice. I also owe thanks to Diane Mew, the book's editor, who at any early stage pointed out that the book's first draft was not coming out exactly as it should. Dealing with Diane is always an exercise in beneficial humility. Naturally any surviving imperfections in the book fall not on the shoulders of my friends and advisers, but on mine alone.

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In the Eldorado office, my arrangements were speeded by the efficient and cheerful trio of Pam Norris, Lori Falls, and Suzanne Perrault, who successively coped with travel and office problems. Richard Duncan disgorged files and information with impeccable efficiency. Faye Armstrong supplied books and other information. Dave Fransen, my principal research assistant, worked hard and ably to bring order out of chaos. If, in writing this book, I have made chaos out of order, I can only plead author's privilege. Linda Goldthorp did yeoman service in local archives in Toronto and contributed, in particular, to chapter 10. Eldorado's veterans have also been helpful. Besides Bill Bennett, Bert Powell, the company's long-term secretary and the keeper of its secrets, helped with advice and hospitality. Dick Barrett generously gave me a day-long seminar in mining engineering, while Jack Burger and Pete Farmer attempted the impossible by trying to explain to me the rudiments of chemistry. Arvid Thunaes similarly tried to work miracles in metallurgy. The result, I need hardly say, is not their responsibility. Eldorado's geologists were especially forthcoming in expounding their science. Ted Smith in Ottawa, Doug Campbell and Lisle Jory in Vancouver, Murray Trigg and George Woollett in Edmonton all helped very considerably in shaping my understanding of Eldorado's geological problems. Alf Caywood of Eldorado Aviation made a special trip to describe his experiences in the north; for that, and for his raspberry wine, I am most grateful. Two of Eldorado's board members, Eldon Brown and Bill James, were willing to endure several day-long seminars on the company's history. The Honourable Gordon Churchill, Eldorado's minister from 1957 to 1960, generously showed me parts of his unpublished memoirs. Bill Gilchrist, president from 1958 to 1974, described his early experiences with the company. The staffs of the Department of External Affairs, the Department of National Defence, and the Public Archives of Canada were, as always, most helpful. So were the historical staff of the Department of Energy in Washington and of the Public Record Office in Kew. Special mention should be made of Edward J. Reese of the Modern Military section of the National Archives in Washington. His advice and enthusiasm contributed a great deal to

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my understanding of Eldorado's history in the 19408. Jess Johnson, the USAEC'S raw materials director, also helped considerably by sharing his memories of the period. Bertrand Goldschmidt of France, Margaret Gowing and Lorna Arnold of the United Kingdom, and Richard Hewlett of the United States, atomic historians all, were uniformly encouraging and helpful. My wife Heather and daughter Eleanor endured frequent absences and considerable grousing during the course of this project. As always my wife's interest and support have made the tedious process of research more bearable and helped to keep my life minimally in order. Finally, throughout most of this project, my mother lent her home in Ottawa as a kind of historical hotel, as she had done for me and my friends for many years. Her hospitality and tolerance as well as her encouragement and optimism can never adequately be recognized, or repaid. Robert Bothwell Trinity College University of Toronto May 1984

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Eldorado

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Prologue

Early in the fifteenth century the rulers of Bohemia, a small kingdom in central Europe, were pleased to learn of the existence of a small silver mine near the town of St Joachimsthal in the Sudetenland, on the border of Saxony. The mine flourished, but then was abandoned, its silver content exhausted. In the eighteenth century attention began to be given to what else might be in the mine. There was a black crystalline material, obviously different from silver, and in 1727 it received the name peek blende. Peek blende (pitchblende in English) duly appeared in books on minerals, but knowledge about the nature of the substance awaited the work of the chemist Martin Klaproth. In 1789, heating the oxide with charcoal, Klaproth isolated a new yellow oxide - what he took to be a pure metal - out of the pitchblende. This metal he named after the wonder of the age, the recently discovered planet Uranus. It received the symbol U, and later the atomic number 92. Uranium had no particular distinction except for its colour. But that was enough, because colour gave it its unique quality. As uranyl nitrate it could, by the end of the nineteenth century, be used in photography, while as uranyl sulphide (UO2S) it produced the pigment uranium red, valuable for the blood colour it imparted to pottery. Bohemia was by now part of the Austro-Hungarian empire, and the empire owned the St Joachimsthal mine. Since the mine now had a use and could turn a small profit, it was reopened for the

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benefit of the ceramics trade. A plant was built to smelt the uranium, and its residues were dumped in the surrounding forest. There they would have remained, but for a strange request. Two French scientists, man and wife, acquired a sample of the St Joachimsthal residues. The couple, Pierre and Marie Curie, had been working on radioactive substances, materials that spontaneously emitted rays containing tiny particles travelling at high speed. Their quest brought them at last to pitchblende and then to uranium. There was, they discovered in the spring of 1898, a strange contrast between the radioactivity of uranium metal or oxide and that of the original pitchblende. Something in the pitchblende, they decided, was more radioactive than uranium. Leaching the pitchblende in various chemicals, Marie Curie discovered two new elements, polonium, named after her native Poland, and then radium, named from the Latin word radius, meaning ray. Radium received the atomic number 88 in the periodic table; its chemical symbol was Ra. The simple discovery of radium exhausted the Curies' meagre supply of pitchblende. More was obtained from the United States government, but that too was soon exhausted. Radium, it became clear, required a great deal of pitchblende. The ratio was not grams to milligrams, but literally tons to a single gram. How many tons, no one as yet could tell. Through a contact at the University of Vienna the Curies learned of St Joachimsthal. At first the Austrian government gave the Curies 100 kilograms; later, when the size of their needs became evident, they were asked to pay a little more than the cost of shipment from Bohemia to Paris. In this manner 11 tons of pitchblende arrived at the Curies' laboratory outside Paris. By 1902 this had producedjust over 1/10 of a gram of radium. The actual metal was not to be manufactured until 1910. Manufactured was the operative word. Marie Curie was working full time to extract radium from pitchblende. What she did and how she did it was the basis of her doctoral thesis at the University of Paris in 1903. She did not patent the process, however, believing that radium's potential was so great that it should be the property of the whole world. The Austrian government promptly banned the export of pitchblende, and shortly thereafter established a radium manufactory.

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The basis of radium extraction was already known. To produce uranium at St Joachimsthal, the Austrians had treated the pitchblende ore with sodium carbonate and sulphuric acid to separate the metal from the radium-bearing residues. The two elements thereafter travelled separate paths; thus, in all future uranium refineries there would be a radium circuit and a uranium circuit. The Curies dumped the residues into boiling sodium carbonate and the resulting carbonates were treated with hydrochloric acid. The product of this process was then filtered. Sulphuric acid was added again. By now, if St Joachimsthal ore was being used, one ton of ore had been reduced to between 10 and 20 kilograms of a radium-barium-calcium mixture. Calcium went next, leaving a radium-barium solution. 'Fractional crystallization' was now used to separate radium chloride from barium chloride. Essentially the solution was allowed to evaporate, and since the rate of precipitation of radium chloride (or radium salt) was faster, it precipitated first. This produced crystals which contained more radium than the solution from which they came. The process was repeated again and again; eventually the crystals contained virtually pure radium salt. It was when the process reached this stage, in 1902, that the atomic mass of radium could be measured. Other things could be measured as well. Radium glowed in the dark, and it caused other materials to which it was exposed to glow likewise. Marie Curie and her assistants noticed burns on their skin, attributable to radium. Radium could, it seemed, counteract cancer and even eradicate it, at least in some cases. Radium's cancer-curing potential caused a sensation. From being a remarkable curiosity radium became a material more valuable, and more valued, than gold. It was obvious from the beginning that its production was long and costly because of the time and the tons of chemicals that it consumed. In those early days the equipment, such as iron cauldrons, was simple, and a fan blew the chemical fumes out over the rooftops of Paris. The results of the Curies' work, discussed at scientific congresses, soon found their way into the popular press. The London Daily Chronicle, for example, wrote on 7 January 1904 that 'It is quite as good as any other assertion to say that an ounce of radium is worth

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the British Empire; no more having been obtained than about the weight of a lump of sugar.' The Austrian government may have proceeded from the best of motives in controlling its potentially great natural resource. The best of motives, however, often coincides with the best of profits. With the cost of producing radium astronomical, or nearly so, it followed that whoever could produce it most easily and most plentifully would dominate the market in this new and valuable element. From the beginning, therefore, radium was a wonder, and a commodity. Industrial production of radium began in 1904 at a factory near Paris, using the Curies' formula. To it were sent radium-bearing ores from Sweden, Hungary, and even Canada. St Joachimsthal remained the principal producer in Europe for some considerable time. But the British Radium Corporation was formed shortly before the outbreak of World War i to exploit a mine in Cornwall, while a French company, the Societe Industrielle du Radium, concentrated on a nearby mine, the south Terras near St Austell. By 1914, ore of various kinds was being extracted in Portugal, Australia, Madagascar, and Russia. The main centre of radium production, however, turned out to be the United States. In the quadrangle of Colorado, New Mexico, Utah, and Arizona a vast deposit of carnotite, usually described as 'a complex mineral with vanadium and uranium,' was found. It had its problems. It was comparatively low-grade and its deposits were scattered over a very large territory, rather than concentrated in any one place. Although almost all the carnotite fields were in the western states, the principal radium refinery was located at Canonsburg, Pennsylvania and at Pittsburgh. This refinery, owned by Standard Chemical, was located with an eye to the availability of chemicals in the tonnages necessary to reduce carnotite to radium; the economics of the situation dictated proximity to chemicals and power and markets rather than any location closer to the carnotite mines. The world's total production of radium prior to World War i had been slight. St Joachimsthal, the most productive facility, had turned out only 13 grams by 1913, but the United States alone manufactured 196 grams of the substance between 1913 and 1926. Although the principal employment of radium was in cancer

Prologue

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treatment, a wide variety of other uses was found. One Pittsburgh promoter marketed a radioactive water, 'Radithor,' which was prescribed for 160 different ailments. One unlucky patient drank over 1000 bottles of it before he noticed that his ailments were increasing rather than disappearing. The trouble with Radithor, American health authorities found, was that it really did contain the radium advertised on its label, and was therefore immune to the pure food and drug laws of the period. That it was deadly was of no account. The promoter, one W.J.A. Bailey, fled by plane to Canada, and thence to France. His patient died. Other, more orthodox, uses for radium posed dangers as well. A spectacular series of illnesses and deaths in New Jersey pointed to dangers in a luminous-products factory. The high mortality from bone cancer there made plain that radium should be handled with extreme care, and that under no circumstances should it be ingested. This knowledge, however, clashed to some degree with the esprit de corps of radium scientists and doctors, who bore their radium burns as badges of their profession. For them, the curative powers of radium outweighed the dangers posed by the element, even though those dangers might place their own lives in jeopardy. One thing was certain. Radium was the best and in some cases the only hope, however slight, for certain cancer patients. Where a cancer was inoperable or immune to surgery, there remained only x-rays and radium. Yet radium remained fantastically expensive. American radium, for example, consumed 500 tons of carnotite for each gram produced. The retail cost was over $100,000 per gram, although that naturally was not the cost of mining and production pure and simple. It was obvious that anyone who could find better ore with more accessibility would be able to place American production at risk. At the end of World War i, that risk did not seem very likely; no other uranium source was large enough to offer any competition. Events were already in train, however, that would put an end to the American radium industry. Just before the war, a Belgian company, the Union Miniere du Haut-Katanga, discovered pitchblende in the Belgian Congo's Katanga province. The Union Miniere was an omnibus mining firm best known for its interest in copper; it was, in turn, largely owned by a Belgian conglomerate,

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the Societe Generale. The war postponed the exploitation of the Union Miniere's pitchblende, but afterwards mining began on an intensive scale. Two things became obvious. The Congolese pitchblende mine was bigger than any yet seen, and it was richer, far richer, than any of its competitors. The Belgians did not immediately disclose these facts. Instead, they set up a refinery outside Antwerp, at Oolen, and quietly began to make and stockpile radium. Then, in 1924, the Belgians opened their offensive. They drove down the price of radium while announcing that their supplies of the stuff were, in practical terms, almost infinite. They were, in any event, more than the Standard Chemical Company could stand, and in 1926 it went out of business. The Union Miniere was now supreme in the marketplace. Estimates of its production vary widely, from 326 grams between 1922 and 1933 to 700 grams between 1922 and 1934. The average price during that period was $60,000 per gram, meaning that by any standards the Union Miniere's radium division was a multimillion dollar business. That much was certain. Some things were not: for example, the grade of Union Miniere's pitchblende. Guesswork put the proportion of uranium oxide (U3O8) in the ore at 40%, and guesswork also assumed that the grade declined over time. Perhaps these were not unreasonable assumptions, and because they were not the Union Miniere saw no harm in allowing them to circulate widely. For one thing, if radium remained a comparatively scarce commodity with every prospect of growing scarcer as the Belgians ran out of pitchblende, then the price need not decline any further. In the meantime the Belgian company's publicity congratulated itself for its reduction in the price of this essential commodity from the exorbitant American level of $100,000 per gram to its 'reasonable' minimum of $75,000 by 1930. The price of radium made it the solace of the rich, or the instrument of charity. Only the very wealthy, or governments, could afford the Belgian price, a fact driven poignantly home by an incident in Geneva in 1930. The Council of the League of Nations was meeting when a young Swiss entered the room carrying a pistol. The pistol was seized by police, who were there to protect the delegate of fascist Italy, and it was discovered to contain only

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blanks, which the young man intended to fire off to demand that the league intervene to lower the price of radium. His father, a poor man, was dying of cancer, and his only hope was radium treatment which he could not afford. 1 The governments of the world might dislike the situation, but they were unwilling and unable to act. There was no alternative to the Union Miniere's radium and therefore no alternative to raising the funds necessary to make radium minimally available in whatever form or quantity science dictated. Between economic monopoly and medical necessity, the Belgian firm's position seemed awesomely secure. In 1936, the Union Miniere's fame rose another notch when a German novelist, Rudolf Brunngraber, published a novel on the subject, naturally entitled Radium. The portrait of the Union Miniere it presented was hardly flattering. Its principal character, Cygnac, would stop at nothing for profit, as a highly melodramatic series of episodes demonstrated. Even at the height of his power, pacing up and down in front of a map of the world, Cygnac is not satisfied. The Russians, he thought, 'were already prophesying a great upheaval in the radium industry. Of course, they were great people for prophesying ... Then Canada was a terrible menace. The Canadians too were Americans. It seemed as if the Americans had made the defeat of the uranium combine [Standard Chemical] a national affair, and that they wanted to hit back ... Fleets of aeroplanes were on their way to Great Bear Lake ... Was the Congo likely to be outclassed by Canada?'2

1 The Canadian Shield

i The exact date of the discovery of Great Bear Lake is uncertain. The existence of the lake was known during the 17805 to fur traders of the North West Company, but there is no clear reference to any of the traders actually visiting the lake until the early iSoos. The lake, local Indians said, was named Saschohetha, a reference to a multiplicity of bears in the vicinity. If bears, why not beaver? the North West men may have reasoned. And so, early in the new century, the North West Company established a post at the south-west corner of the lake, near its outlet into the Bear River, which in turn connects with the Mackenzie River and the outside world. Explorers would eventually discover that Great Bear Lake was North America's fourth largest inland freshwater lake, 12,275 square miles in area (31,792 square kilometres), roughly 200 miles long and with a width varying from 25 to no miles. The lake projects into five large bays or arms, Smith, Keith, Dease, Me Vicar, and McTavish, named after the early fur traders who first passed through the area. The Arctic Circle traverses the northern part of the lake, and the tree-line at points comes up to the shore. The western edge of the Canadian Shield lies along Great Bear's eastern shore, giving McTavish Arm a spectacular, rough edge. The

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passage of glaciers is clearly evident in the indented shoreline, and in fact the lake itself was created by glaciation, which scraped out and deepened a valley on the site. Although it does not look it, Great Bear in this sense resembles Lake Okanagan in British Columbia; more obviously, it is related to the other western great lakes, Athabasca and Great Slave, further up the Mackenzie River system. Great Bear Lake is navigable for roughly four months of the year, from early July to late September or early October. Its temperature is generally frigid, making swimming foolhardy at best and fatal at worst. During the open season, storms sweep across the lake, making navigation sometimes a tricky business. But given the character of the shoreline, navigation is the only way to get around. Early visitors to the area appreciated the convenience of water travel, but not, if their narratives are any indication, too much. 'This place is reckoned rather unhealthy, both to the whites and the Natives,' an early trader wrote. 'The climate is very severe,' even by the standards of the North West Company, 'cold and inhospitable.' There was fur in abundance, from caribou, moose, and the 'musk buffaloe,' as well as martens, muskrats, and 'a diversity of foxes,' but despite the name of the place there were 'no great number of bears' and very few beaver. One thing impressed, however: 'This country,' the commander of the Bear River post wrote in 1812, 'is interspersed in every direction with an almost incredible number of lakes of every dimension, some very large indeed. Bear Lake surpasses them all in this respect. The extent of this immense body of water has not hitherto been ascertained, either by the Natives or the whites.' Perhaps when the whole lake was explored, something of value might turn up; optimistically, the North West company agent added that' I have no doubt that several kinds of ore might be found here ...' But what kind of ore he could scarcely have imagined.1 By the 18205 the fur traders had passed Bear Lake by. The name was changing: because of its size Bear Lake was hardly descriptive enough, and 'Great Bear' was coming into use, to match its southern counterpart, 'Great Slave.' The lake still had not been

FIGURE 1

Transportation routes

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completely explored, but it was known that two days journey from its north-western edge lay the Coppermine River, and beyond that the great northern ocean itself. It was the ocean rather than the lake that was the goal of the next group to concern itself with Great Bear. From 1825 to 1827, Captain John Franklin of the Royal Navy based an exploring and scientific expedition at the now abandoned North West post, which he modestly renamed Fort Franklin. Between intervals of Arctic exploration, he and his officers mapped the shores of the lake, noting its extraordinary depth which, in McTavish Arm, measured more than 270 feet (at its deepest the lake descends 1356 feet). Franklin's party did not venture inland, but their doctor-naturalist, John Richardson, described McTavish Arm's shoreline as 'granite, verging in a few places towards gneiss ... The weathered surface of the stone was everywhere of a brick-red colour.'2 The next visitors to the lake, a Hudson's Bay Company party, wintered at the tip of Dease Arm in 1837—8 and 1838—9, leaving behind a substantial establishment, Fort Confidence, that was still standing over sixty years later. In 1848-9 Dr Richardson, by then Sir John Richardson, returned to the lake as part of the search for Sir John Franklin, whose pursuit of the North-West Passage led to disaster for himself and the crews of two Royal Navy ships. After Richardson departed no one else came, except for the occasional missionary. The Hudson's Bay Company confined its activities to the valley of the Mackenzie; there was no interest, or profit, in Great Bear. If the servants of the Bay had no great interest in the wellmapped but deserted lake, the servants of the government did. In 1900 a party from the Geological Survey of Canada traversed the lake. 'As I look back on it now,' Charles Camsell later wrote, 'it was a foolhardy expedition that had no business to survive, for it was poorly equipped both in supplies and personnel.' Survive it did, however. When Camsell and his companions, travelling in two canoes, passed along the shore, the weather was cold. 'On the 24th of August,' Camsell wrote, 'we were in Echo Bay,' off McTavish Arm. 'The weather was stormy, snow fell occasionally, and in the mornings the temperature was below freezing. The short Arctic summer was almost over.' While waiting in Echo Bay for the storm

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to pass, Camsell noticed something unusual about the rocks by the bay's entrance. 'The rocks were stained by oxidation of the minerals with red, green, yellow and pink colours. This outcrop was carefully examined and the evidences of iron, copper, uranium and cobalt noted.' For a geologist this was news indeed, information worth having. For those outside the profession, it was only of academic interest. Great Bear Lake was too far away for the economic exploitation of minerals, and therefore, as Camsell later recalled, 'no particular significance was attached' to his discovery. The official geological report of the Camsell expedition was published the next year. It contained the following summary of his discoveries at Echo Bay: Tn the greenstones east of McTavish bay occur numerous interrupted stringers of calc-spar containing chalcopyrite, and the steep rocky shores which here present themselves to the lake are often stained with cobalt-bloom and copper-green.' But in 1901 nothing short of gold would have attracted attention and prospectors to Great Bear Lake, and there was no sign that something even more valuable than gold was present. Most of the language Camsell used in his report is now somewhat dated, and the report itself should not be taken as more authoritative than it actually was. What an attentive reader could have discerned was that cobalt and copper had once been present, that they had oxidized, and that in all probability they were still around, beneath the surface. It was true that there was an association between cobalt and silver elsewhere in Canada, especially at the great Cobalt mining camp in Ontario, and it seemed reasonable that elsewhere in the Canadian Shield a similar association might exist.3 Great Bear Lake dozed on, untroubled by prospectors. The First World War passed and still no attempt was made to unlock the lake. Other developments were, nevertheless, bringing opportunity closer to Great Bear's shores. Oil was discovered on the Mackenzie, at Fort Norman, near where the Bear River flowed in. The oil was briefly tapped, but there was no market large enough to use it profitably. Imperial Oil, its owner, capped the wells and waited for better days.

The Canadian Shield

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Further south, Canada's agricultural frontier was inching northwards. Farming reached the Peace River country and by 1920 the railway had reached Waterways, in central Alberta. Waterways, or Fort McMurray, was located on the Athabasca River. From there, boats could travel down the Athabasca, across Lake Athabasca, and then down the Slave River as far as the boundary of the Northwest Territories, at latitude 60° north. After a portage there, no further obstacle was encountered until the Arctic Ocean. The Hudson's Bay Company, the biggest commercial firm in the area, increased its existing fleet of steamers and tugs on the Mackenzie and expanded its shipping season. Four hundred tons of freight a year were shipped into the Territories before 1920; by 1929 the Hudson's Bay Company alone was bringing in 5000 tons. By then another innovation had occurred. In August 1920, an air service opened between Edmonton and the Peace River country; before long it expanded northwards to service Imperial Oil at Fort Norman.4 The First World War greatly advanced the development of aircraft and, incidentally, the number of airmen. Pilots took their planes wherever they could earn a living. Aerial surveying now became possible, and where that was possible so was airborne prospecting. Isolated communities could have communication with the outer world on a reliable basis. Freight could be flown into the Territories the year-round, if desired. Wireless radio was also extended northwards as the Royal Canadian Corps of Signals set up radio stations across the western Arctic in communication with southern Canada. Special air-equipped prospecting companies sprang up, either using their own planes or those rented from others. Such expeditions could be quite elaborate, but the time they saved made it all worthwhile. The laborious prospecting crawl over a map grid could now be reduced to a quick overflight, pausing now and then to scrutinize interesting outcrops. At the opening of a prospecting season, parties could be set down at different map co-ordinates, with a single plane to service them all, and with an engineer hopping from one to another as and when his professional skills were required. If a discovery was made, a working party could be dispatched quickly to the site to do some surface

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digging (or, more systematically, trenching). At the end of the season, reliable data would be procured, while caches of necessary supplies would be laid out for the next season.5 It is useful to bear this idealized picture of airborne prospecting in mind, since Eldorado's experience was somewhat different. So, presumably, was the experience of many companies. There were never enough geologists, engineers, and aircraft to go around. There were, however, plenty of prospectors and for every prospector there was likely to be a speculator, ready to pour funds into Canada's mysterious and hopeful north. By the late 19205 the lid was definitely off northern development. In 1929—30 the federal Department of the Interior, which had the running of the Territories, reported 'great interest and activity' in northern Canada, especially in that part of the Canadian Shield that lay between Great Bear and Great Slave lakes, lying to the east of the Mackenzie River. No less than 500 men and 70 planes were working the north in 1929, searching for gold or base metals, especially copper and zinc. Great Bear Lake itself did not escape scrutiny: attention tended to concentrate near Hunter Bay at the northern corner of McTavish Arm. There, in the summer of 1929, a bush pilot set down a middle-aged prospector. It is with this man, Gilbert LaBine, that our story properly begins. II

The two LaBine brothers were born on a farm at Westmeath, Westmeath township, Renfrew County, Ontario. The elder, Charlie, born in 1888, was of an age to join in the great prospecting rush that established the great mines of north-eastern Ontario. The younger, Gilbert, born in 1890, attended school, including even some high school, before he too took the train up the Ottawa Valley to the great mining camp at Cobalt. Charlie was always the more rough and ready of the two, 'a rough diamond.' He had more than the usual drive and, judging from results, more than the usual charm. Charlie became a very successful salesman. His product would be mines. Gilbert, for his part, was independent, handsome, and, like his brother, determined to succeed. T've worked less than a year for

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any other man,' he later boasted of his time at the University Mine in Cobalt. Early experience must also have persuaded Gilbert that he was lucky. He made his first prospecting strike in some silver claims near Cobalt and with $5000 jingling in his pocket, signed on at the provincial school of mines at nearby Haileybury. The visitor one day was W.G. Miller, the provincial geologist. What happened next was frequently retold, usually by LaBine himself. Miller had only recently taken a tour of Europe. He had brought back some rock samples and with these he had formulated a theory. Miller's idea, baldly stated, was that the silver-bearing rocks around Cobalt resembled the silver deposits at Joachimsthal. And to illustrate his point, Miller flourished samples of pitchblende. In Gilbert's recollection, the other students were bored by Miller's enthusiasm. They wanted gold and silver. Pitchblende had no immediate value, and as for radium, its price still had to be established. Gilbert took away a simple lesson. Uranium was a heavy metal, the heaviest known to man. Pitchblende, therefore, was likely to be heavy, reflecting the high specific gravity of its contents. Mentally weighing the lump of pitchblende, LaBine set forth from Haileybury early in 1908. Gilbert and Charlie, working in tandem, achieved a modest fortune by 1914, when their association was interrupted because Charlie joined the army. By then they had begun to handle other people's money and to function in a modest way as promoters as well as prospectors. But though they acquired a taste for promotion, they had qualities that the typical promoter did not: real prospecting and mining skills and, in Gilbert's case, an elementary knowledge of geology.6 While Charlie battled the Kaiser, Gilbert improved the LaBine fortunes by moving west where, in the spring of 1918, he staked a claim to a gold-quartz property in Manitoba's Red Lake district. There was a share for his partner, William Walton, and a share for the absent Charlie. Developing the vein waited upon Charlie's return and in fact it took longer, much longer, before the two brothers got around to incorporating a company to exploit Gilbert's claims. Late in 1925 the brothers began to circulate proposals for incorporation, and in January 1926 their new company - Eldorado Gold Mines, Limited - saw the light of day. Eldorado was a good name for a mine. Eldorado originally

18

Eldorado

meant the City of Gold, a place of fabulous wealth, the goal of countless explorers and the troops that followed them. By the 19205, the term had acquired a more abstract meaning, perhaps because the real Eldorado had never been found. It still might be, though, and Manitoba might prove to be its true location. The Red Lake claims gave the company form, but investors' money gave it flesh. That was Charlie's department, and the list of original shareholders shows that he plied his trade between Haileybury and Cobalt in the north, Toronto in the south, and the Lake Huron shore and Montreal in the west and east respectively. One example of Charlie's success was Seaforth, Ontario, a little town just inland from Lake Huron, where he signed up shareholders variously described as 'merchants,' 'spinsters,' 'married women,' 'butcher,' and 'retired gentleman.' Mining speculation might be said to be the lottery of the day, just as the selling of mines was the equivalent of a medicine show. The spirit in which some investors approached the subject of mining may be discerned in a letter from an Eldorado shareholder a few years later: 'To put it plainly, I believe Sir, that one man's guess is just as good as another's in purchasing mining stocks and I prefer to make my own choice.' By this motto the curb section of the Toronto Standard Rock & Mining Exchange lived and prospered.7 The Toronto Mining Exchange was reputed to be the largest in the world, and perhaps it was. Its reputation was not slight in other areas too; according to a chronicler of those times, it was considered 'routinely, almost preposterously, crooked.' The Financial Post, the respectable organ of Toronto's financial community, sermonized against the curb operators who bilked old ladies and orphans of their past and future earnings. In the frenzied 19208, however, the Post's warnings were regularly ignored. The most pointed criticism that the Post could make of mining stock speculation was that the bad operators tended to discredit the good ones. But it may also be true that the two had a symbiotic relation. The good mines, the gambles that paid off, established the law of averages that was essential for raising capital from small investors. What the investor did not ask for, he did not get. He did not, for example, ask for geological reports and engineering surveys. The word of an old grubstaker just in from the north would do,

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sometimes for many thousands of dollars. If the prospector had a particularly good reputation, as the LaBines did, and presented his pitch in an enticing way, as Charlie did, then the money flowed.8 It certainly flowed to Eldorado. From February 1926 on there was a steady stream of subscribers. Shortly after incorporation (though not right at the beginning) Charlie became Eldorado's president,* in charge of head office and funds. Gilbert became managing director, in charge of spending the money Charlie raised. The story of Eldorado's Manitoba mine at Long Lake is briefly told. During 1927 and 1928, a shaft was sunk 500 feet, and lateral tunnels (known as cross-cuts or drifts) were driven out in search of gold. By the end of November 1928 only one conclusion was possible. As the mine superintendent reported in a letter to Gilbert LaBine, 'After carefully back sampling the drifts over the entire length of the break and comparing the results obtained on each level it was concluded that better values could not be reasonably expected at depth and the possibilities of obtaining ore in commercial quantities above the 5OO-foot horizon had been practically exhausted.' Mining ceased. What was left of the equipment was sold off in 1934 to another LaBine company, Gunnar Mines.9 The discontinuance of operations at Long Lake left Eldorado Gold Mines without its gold mine, but with cash in the bank. In January 1929, Eldorado's board of directors approved what had already been done, and also approved the purchase of 'good mining stocks' with part of the treasury. Further action waited for a meeting of the shareholders, which was called for 31 January, in Toronto. The Seaforth shareholders, speaking through one of their number, let it be known that they had 'had a fair run for our money' and proposed to 'cheerfully take our loss, close up our account and accept back, in just proportion, whatever money is left.' They pointed out that stock certificates had not yet been issued, and that therefore their money was in a form of trust, to be used for Eldorado and Eldorado alone. That meant a mine, and not other people's stocks.10 It was a strong argument, but such arguments are not won on * The first president appears to have been A.E. Hall, of Toronto.

2O

Eldorado

logic alone. There was another faction of shareholders, centred in Winnipeg, and represented by R.A. Purves and John MacAulay (of whom we shall hear more presently), who preferred to leave their money where it was. They too felt that they had 'had a good run for the money,' and they wanted it to go on. There was, they understood, $300,000 in the treasury, in various negotiable forms. How could anyone living, as they did, in 'a country which Providence has so kindly blessed with natural resources' wish to wind up a mining company which still offered the chance of recovering all their investment, not to mention a handsome profit. 'The LaBine boys,' Purves wrote, 'are experienced pioneers in the mining business, they have a good connection with the mining fraternity, and are in a position to get first hand information on new fields, and their knowledge of and access to Northern developments should also help us in building up, by judicious investing, the very nice surplus with which we have to work.' 11 The combination of the LaBine shares with those of the western shareholders gave Gilbert and Charlie a comfortable cushion when they entered the shareholders' meeting. Long afterward Charlie remembered what happened as follows: 'Jack Greenberg, who was a young Toronto lawyer and the registered owner of No. i certificate of the company's stock, moved that [a] bylaw be passed to permit the company to look for a [new] mine. A vote was taken and two-thirds of the shares were voted in favor of the bylaw.' The total was, in fact, 1,717,526 shares in favour of Charles LaBine, 'being 49,691 shares over the 2/grds required under the terms of the Ontario Companies Act.'12 Eldorado was still in business. Ill

In the spring of 1929, Gilbert LaBine held the initiative in Eldorado's affairs. And Gilbert LaBine is the best, indeed the only, source on what he did with it. The solution to the company's problems seems first to have occurred to him in 1928. A trapper named Sloan mentioned to LaBine that on a trip to Great Bear Lake in 1922 he had found considerable copper and gold

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showings. LaBine's interest was piqued, and the interest was reinforced when, in Winnipeg, he found people talking about mineral prospects in the distant Northwest Territories. Copper prices were advancing, and it might, just possibly, be the ticket for Eldorado. To get into the Territories, LaBine selected the air route. The convenience was unbeatable. An arrangement was made with Western Canada Airways of Winnipeg. One of their pilots, Leigh Brintnell, would drop LaBine off, and in the summer of 1929 they flew north to the Arctic Circle. Sloan himself showed up a few days later. His reward seems to have been to furnish his name to the Sloan River, which flows into McTavish Arm near the reputed copper find. There was copper there, as promised, but the economics of getting it out proved impossible. Copper would never, in LaBine's lifetime, be worth enough to justify extracting it from Great Bear. This dismal realization sank in on LaBine as he was being eaten alive by insects, and while waiting for his increasingly overdue ride home. T looked like a piece of raw liver,' he told Peter Newman many years later. Luckily a trader with a boat happened along — very luckily, since he was the only trader with a boat on the lake. 'The trader told me,' LaBine later said, 'it was not good policy to remain there because I would likely starve to death so he said I could go out with him and I probably could head off the plane at Fort Norman.' As proverbially happens in such circumstances, one of Brintnell's planes came winging in and plucked LaBine off, just before he started on the 25O-mile trip to Fort Norman, the Mackenzie, and home. LaBine's account of what happened next appears in several versions. In 1932, he told a banquet: While I was at Hunter Bay at that particular time in August 1929 I had an opportunity of studying conditions and visualizing the possibilities from a mineral standpoint, and I said there and then I was going to go back the following year and make a thorough job of that district covering the area from the Camsell River [at the south end of the lake] which is the western fringe of the Pre-Cambrian up to where I had been that year. I thought there were excellent possibilities of finding ore deposits there, of great value, when I returned.

22

Eldorado

The story the old mining magnate told Peter Newman, in the 19505, was more explicit. While flying out from Hunter Bay, the plane passed over 'some rocks with smudges of peace red barely visible against the lowering rays of the afternoon sun. This was an indication of cobalt bloom, and where there was cobalt, there might be silver, and possibly pitchblende.' That, to LaBine, meant only one thing. T suddenly realized,' he told Newman, 'that I was in elephant country,' by which he meant a place of vast promise. Punch Dickins, LaBine's pilot, corroborated some of this. 'We were flying along the east shore of the lake when LaBine started to jump around and make sketches in his field book. He asked me if I thought I could find the spot again.'13 Tradition has it that LaBine spent the winter of 1929-30 searching a forgotten archive in Ottawa for clues about the eastern shore of Great Bear Lake. He apparently found what he was looking for, since the report of the Camsell expedition had been printed back in 1901 and any good mining library would probably have a copy. The two LaBines made plans for a concerted expedition into Great Bear Lake in 1930. Gilbert would go first in the spring, by plane, taking with him E.G. St Paul, an experienced prospector. They would land at the mouth of the Camsell River at the southern end of McTavish Arm, and work their way north along the rocky shore. This was only common sense, since the nature of the coast line made it easier to travel out on the ice where the going was easier. Then, in the summer, Charlie would come in by water. As Charlie explained many years afterwards, 'Our big problem was transportation... I had experience with canoes, so Leo Seaberg, Shirley Cragg [an Eldorado director] and I decided to take the 1,450 miles from the railhead to Great Bear Lake by canoe.' They would meet Gilbert and St Paul as soon as navigation opened on the big lake, in July.14 LaBine and St Paul landed on the shores of Great Bear Lake at the end of March 1930. There was plenty of daylight, because of their proximity to the Arctic Circle, and they promptly crosssectioned the countryside and set to work on establishing its geology. By mid-May they had worked their way up to Point 66, the western end of Echo Bay. There was plenty of wood around, and it was a good place for a camp. Suddenly, on 15 May, St Paul

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contracted snow blindness, a painful though transitory ailment. There is little to do but relieve the affliction with poultices, and to sit in darkness until its effects wear off. St Paul therefore stayed in camp, while LaBine roamed around the neighbourhood. On 16 May, LaBine was exploring an island some distance offshore when he suddenly looked over to the mainland. There, he later recounted, he noticed 'a great wall ... that was stained with cobalt bloom and copper green. I walked over to this place and investigated it carefully and found all the associated ores of cobalt, including silver. Following along, I found a tiny piece of ore, probably the size of a large plum, and it was pitchblende.' It is a good story, and basically a true one. LaBine's journey up the eastern shore of Great Bear Lake was more speculative than he later claimed. He was probably aiming, ultimately, for Sloan River, off Hunter Bay, where he had been the summer before and where he had staked some claims. He was aware that other prospecting crews were or soon would be in the area. But contrary to reports subsequently published, LaBine's pitchblende, as he later stated, 'could not be seen from the air and in fact could not even be seen where the first ore was found. While this occurrence was naturally new to me,' LaBine added, 'the ore was of such a grade that there was no doubt in my mind but that I had found a very rich deposit of uranium ore.' He had also found silver, enough to persuade him not to tell St Paul the whole story of the day's events. LaBine's first two claims at Echo Bay were on what would be dubbed LaBine Point. Cobalt and Cobalt i were staked out on May 18 and 19 respectively. Two more claims were subsequently staked, but at that point LaBine and St Paul decided to continue north, heading for Sloan River. This action may indicate uncertainty over what had been found, or it may simply show that LaBine did not want to exhaust his stock of claims (each man could stake six, as well as two sets of proxies, for a total of eighteen). In a speech made in November 1934 LaBine confirmed this. 'We continued our trip,' he said, 'prospecting northward, to where I had been the previous year ... hoping to find another such area as we had staked. However, we were not successful.' It was by then June, and the lake's ice was melting, immobilizing travellers. Meanwhile Charlie LaBine and Shirley Cragg were

24

Eldorado

coming up from the south as the various components of the Mackenzie River system thawed out. What LaBine's subsequent accounts did not mention was the presence of at least two other prospecting groups. There was one from Consolidated Mining & Smelting, of Trail, BC (CM&S), and one from the Northern Aerial Mineral Exploration Company (NAME). The CM&S crew was working just over the ridge from LaBine Point, and staked 'two groups of claims' to the north-east, 18 in the first and 23 in the second. This, as Ted Nagle, one of the CM&S group, later said, left a gap between CM&S and Eldorado, a gap which Nagle urged LaBine to fill in. LaBine apparently replied that he was short on proxies and for the moment did nothing more. This was not the end of contact between Eldorado and CM&S. CM&S was well equipped, with radio and aircraft; strangely, they lacked such elementary tools as blasting powder, jack hammers, and drill steel. These LaBine had, or soon would when his brother and his partner reached Sloan River. It was presumably on a CM&S aircraft that the first ore samples from LaBine Point were sent out for analysis, either before or after Charlie and Cragg arrived at Sloan River on 21 July. The trip had not been uneventful. 'We had some near spills,' Charlie remembered, 'where we could easily have lost our lives as well as our supplies. It took us five hours to navigate the Bear River Rapids, with a lo-horsepower heavy duty motor on our boat, which was only half-loaded, and there was a 6o-foot drop in five miles. But we made it.' Once they did arrive their cargo was pressed into joint service for the CM&S and LaBine parties at Sloan River, and it was here, on 12 August, that Gilbert LaBine received a coded wireless message over the CM&S radio. LaBine took the message into his tent to decode. Half an hour later he erupted.Collaring John McDonnough, who was flying a new Fokker plane, and Ted Nagle, LaBine said, 'Pull down your tent, Ted, we're going back to our camp at The Point. HURRY.' 'At 8 p.m.,' Nagle remembered, 'we were all aboard and taxiing for take-off. In less than half an hour we were landing in our bay near our camps.' Back at Sloan River the wireless operator stared at his message pad trying to make out what had excited LaBine so. It was all in code, except for one word. The word was 'uranium.' Gossip

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travelled fast in the north, and the next day a plane from NAME landed at LaBine Point. In the background frantic re-staking was going on, while LaBine's men were filling in the hole left between the LaBine claims and those of CM&S. Gilbert found time for a friendly chat and lengthy stroll with the head of the NAME party. By the time the stroll was finished, so was the staking. Included in the bonanza was John McDonnough, the pilot, who got two claims for his trouble and who, reputedly, sold them for 'a sizeable sum of money.' One account claims that LaBine's samples were now sent to the Bureau of Mines in Washington for analysis; another holds that the proper destination was the Bureau of Mines in Ottawa. Whatever the truth, the result was the same: LaBine received confirmation during the summer that his find was pitchblende. Better still, it was very high grade, containing 60% uranium. This was LaBine's 'elephant.'15 IV

The arrival of pitchblende samples from Great Bear Lake created a minor sensation. But nowhere was there more excitement than in the Department of Mines in Ottawa. The department - a preeminently developmental organization — had been established for moments just such as this. It existed to assist, to investigate, to publicize the resources of Canada. The Geological Survey of Canada explored and mapped mineral formations, and as we have seen, some of its activity contributed to the discoveries at LaBine Point. The Mines Branch was specifically devoted to the aftermath of discovery — verifying, analysing, and rationalizing what had been discovered. Its mandate, as expressed in its annual reports, was to 'extend, wherever and whenever possible, every legitimate assistance toward the greater development of the mining industry.' Two of Mines Branch's divisions were to be involved with Eldorado's future. Its Mineral Resources Division would help by furnishing information and advice on mining methods, as well as on the nature and character of the minerals discovered. It was supposed to furnish advice on prices and eventual markets. And what Mineral Resources could not do, the Ore Dressing and

26

Eldorado

Metallurgy Division could. Ore Dressing, with its staff of chemical engineers and metallurgists, was an old hand at rendering assistance to the Canadian mining industry. In the years 1930—3 alone, it boasted, the division helped to establish 37 mills while assisting with plans for 29 more. It was not unusual to try to duplicate conditions of commercial production in Mines Branch laboratories. Such testing involved setting up 'pilot plants,' experiments on a very small scale, which would duplicate the chemical processes necessary to purify or separate a mineral. The Mines Branch was, therefore, professionally interested when LaBine's samples were deposited on its work benches. It soon became politically interested as well, for reasons that were selfevident. The great attraction of radium was its high price, $70,000 or so per gram on the world market. Radium was the best hope against cancer, or so it seemed, and therefore its distribution as well as its price were a matter for governmental concern the world over. In 1930 Canada contained 16 grams of radium. The largest concentration, one-half gram, was in a hospital in Ontario, a pitifully small amount in the opinion of cancer specialists, and in the view of an Ontario Royal Commission (known as the Cody Commission), which investigated the matter and reported in early 1931. Ontario, indeed, had offered a bounty for commercial-scale radium production as early as 1914. But the fact that Ontario and Canada as a whole were being outclassed in the field of cancer treatment was dispiriting. The solution offered by the Cody Commission had already been implemented in Great Britain, where the National Radium Trust, a quasi-public entity funded by government, governed the distribution of radium. It was essentially a purchaser and warehouser of the stuff, since British radium production (never great) had been stopped. Ontario, and perhaps Canada, could have such a commission as well. The idea that such a commission might extend its activities to purchase and administration was a natural conclusion, and it came into play almost as soon as the Eldorado discoveries were known. There was a final factor involved in the reception given to Eldorado's finds by government. Economic growth at a time of depression was welcome. Mining, a traditional field for official

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involvement, was easy to promote. Better still, minerals were exported, thereby adding to the nation's income and earning valuable foreign currency. At $70,000 per gram, or anything like it, Eldorado's ore was attractive indeed. While the chemists in Ottawa were pushing Eldorado's pitchblende through their laboratories, the business of the company proceeded. LaBine, Cragg, and St Paul were all rewarded with stock for their claims at Great Bear, including both the Hunter Bay and Echo Bay properties. Since information on the LaBine Point discovery was leaking into the press, this was no small matter. Eldorado stock, previously trading at 20 cents, advanced to 42 cents early in 1931 .Reports on the company emphasized how much money it had banked and stressed that it had no need to dilute its stock to raise funds. 16 Tests on Eldorado's first ore took several months. Hugh Spence, the Mines Branch's ranking expert on radium, took two samples in October 1930. At the beginning of December he submitted them, on LaBine's behalf, to the Ore Dressing division for analysis. Two samples were considered, one from Number One vein, and one from Number Two. Despite their different provenance, the two samples were very similar in appearance and nature. Both, the official report stated, 'were high-grade pitchblende ore.' Each sample contained veins of pitchblende, 'cut by very minute thread-like veinlets, which are composed of a number of finelycrystalline sulphide materials.' Both samples contained silver, and one had what was described as 'an appreciable quantity of gold.' The two samples were crushed (a small sample of each was crushed to a fine powder) and then analysed. The first batch, labelled no. 13, showed 56.91% U3O8, or uranium oxide; the second, labelled no. 14, showed 63.94% uranium oxide. If the values in these samples proved to be representative of the whole ore body, then it could be estimated, using a conservative value of $50,000 per gram of radium, that a ton of Eldorado ore would generate between $7225.50 and $8119.50. However, it was a big 'if since at the time no comprehensive drilling program had been undertaken — an essential requirement in establishing the tonnage and grade of an ore body. The conclusion, handed down on 16 February 1931, was that 'both samples were very high-grade

28

Eldorado

radium-bearing ores. Their value is enhanced by the absence of the element thorium and the analyses of the U3O8 much simplified by the low iron content of the samples.'17 The first official announcement of what LaBine had found was made in Ottawa by no less a personage than the Honourable Wesley Gordon, minister of Mines. His staff, he told the press, had analysed eight samples of ore both electroscopically (measuring radiation) and chemically. The uranium content of the samples varied between 27.88% and 83.9%, meaning that there might be between 70.79 milligrams of radium per ton of ore and 213 milligrams per ton. His listeners immediately multiplied these figures by $70,000 per gram, to arrive at values between $4956 and $14,910 per ton. At about the same time, and presumably acting on information from Ottawa, LaBine sent up an advance party of eight men to start clearing the future mine site.18 What a politician can claim to his credit the opposition can lay to his blame. It took less than a month for the opposition in Parliament to start peppering the minister of Mines with questions that were intended to raise as much heat as light. In May 1931, Eldorado first entered the political arena with a question from a Liberal MP to the Conservative Wesley Gordon. Given the crucial importance of radium as well as its high cost, would Gordon consider obtaining 'control' of the radium discoveries on behalf of the people of Canada? Gordon, evidently taken by surprise, waffled. The question raised, he told the House of Commons, 'is one to which some attention might be given.'19 It must have seemed, over the next few years, that the 'nationalization' option would get little but attention. Gordon protested, shortly afterwards, that any questions about radium were premature, that not only was the mine just discovered but that its commercial value was not proven. But his publicity, which had been reported around the world, had been too successful.20 Eldorado, too, was in the business of publicity. The summer of 1931 saw a series of bulletins issued from Eldorado's Toronto headquarters to an audience only too willing to give them their attention. In mid-April, Charles LaBine announced that fifty-four 5O-acre claims had been staked at Echo Bay. Two veins existed, he told the press, one extending for 2000 feet and

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varying from 5 to 20 feet in width, the other 700 feet long and measuring between 6 and 10 feet in width. The two veins ran parallel to one another 300 feet apart. Gilbert, not a man given to understatement, proclaimed that his ore was 'more regular and of greater extent than any other known occurrences.' But he also sounded a cautionary note. The pitchblende, if it maintained a 40% grade, would be worth $7000 a ton, and, given shipping charges out of $400 a ton, it could be made profitable. As events turned out, his caution was well advised. When the mine began to produce, the average grade of the ore was slightly over i % and this was to render quite unrealistic the predictions of profitability. The silver, however, was of doubtful value, and LaBine was inclined to downplay its commercial possibilities, at least in public. In fact, however, LaBine was intensely interested in the silver. Tt might be of interest to you to know,' he wrote in 1960, 'that I had hunks of silver which weighed up to twenty pounds containing at least twenty thousand ounces to the ton as well as very rich botryoidal pitchblende.' Back in Toronto, Charlie told the shareholders that Gilbert had found high-grade silver ore, 'with evidence of large tonnage.' The tonnage discovered may never have been as rich as 20,000 ounces per ton of ore, but 8000 ounces to the ton was not unknown. Silver had the advantage of relatively straightforward processing, which could be done at the CM&S facilities at Trail. It could provide a steady income pending the perfection of an economical method for treating Eldorado's pitchblende. As to that, Charlie breezily told the press that the government was studying ways of treating it, an observation that stung Gordon into replying that that particular question had not even been discussed.21 Work at the Great Bear Lake site was exclusively on the surface. During April 1931, Gilbert LaBine and his crew excavated 10 tons of ore on Number One vein (see figure 2) which ran close to the shoreline down near LaBine Bay. It was hoped, LaBine telegraphed home, to get 10 tons out by i May, while the ground was frozen, so that flooding could be avoided. What was being dug out would go straight to Ottawa to fuel the Mines Branch pilot plant. What stayed in the ground LaBine kept to himself. 'Eldorado is secretive, say visiting engineers,' a Financial Post headline com-

30

Eldorado

plained late that summer. LaBine was violating the courtesies traditional in the mining profession, but he put little stock in objections. 'Some of our eastern friends say C.M.&S. and Eldorado have hogged the camp,' he wrote in December 1931 to his friend Ted Nagle. 'I wonder what they would have done had conditions been reversed. Well now we have it let's give them a demonstration how to'dig it up.' 22 The other important event of 1931 at LaBine Point was the first visit to the site by a civil servant. Hugh Spence, of the Mines Branch's Mineral Resources Division, appeared in August and September to see for himself what LaBine had found. His would be the task of writing up the significance, if any, of LaBine's pitchblende discovery. What he could prove, and what the Ore Dressing Division could devise, would determine whether LaBine Point would ever be viable, or whether it would be just another hole in the ground. Spence's opinion was not long in doubt. Vastly impressed by what he saw at Great Bear Lake, as well as by the samples (20 tons of it) that LaBine sent to Ottawa, Spence decided that LaBine Point was the event of the decade. It was, he told the annual meeting of the American Institute of Mining and Metallurgy — a blue-ribbon mining body — in New York City in February 1932, 'the most important mineral discovery in many years.' Soon there would be large supplies of radium from the north. The price of radium would fall, and the result would be a universal boon to mankind.23 The Mines Branch was doing its best to make the mining millennium come to pass, but its official reports are unusually revealing on the subject. The fiscal 1931—2 report of the Department of Mines, released in the spring of the latter year, called the discovery of minerals at Great Bear Lake a matter of 'outstanding importance.' It was much more than a scientific curiosity, the report continued. 'The possibilities of the area as a source of radium decided the Government to undertake an investigation to determine the most economic and practical method of recovering the valuable content of these ores.' There are no cabinet records that would reveal whether 'Government' meant cabinet or minister, but what is certain is that the Mines Branch at the very depth of the Great Depression received sufficient funds to buy new equipment

FIGURE 2

Port Radium

32

Eldorado

in order to set up a small pilot plant to extract radium, as well as an electroscopic laboratory to measure and detect the radium element in the Eldorado ores.24 By the winter of 1932-3, the civil-service metallurgists were convinced that they had found the answer. Eldorado's pitchblende posed particular problems, since its mix of minerals was different from either the Congo or Czech ores, and therefore it needed special treatment. Canadian scientists had developed a method for treating pitchblende which reduced 'the length of the operation necessary to produce radium salts from three months, the time reported to be required by the Belgian process, to less than half that period.' Never grudging in self-praise when a departmental budget had to be justified, the Department of Mines concluded that this constituted 'an outstanding contribution to metallurgical science.'25 The optimism radiating from the Mines Department in 1932 created a minor political problem for the Bennett government. Stoutly Conservative, the government had no predisposition to interfere with the private mining business, although it approved strongly of the help that its Mines Department regularly furnished. The high values that Eldorado's ore was projected to have were founded on the high price of radium. That price, in turn, was politically controversial, either because it barred poor cancer patients from radium treatment or because the funds to treat them had to be coughed up by government. There was also a doctrinaire feeling among some of Bennett's opponents that private ownership of natural resources was in all cases a bad thing, and that Eldorado merely provided an object lesson in the evils of allowing promoters to dominate Canada's mining industry. To some extent the Bennett government was fortunate in its opponents. When M.N. Campbell, the Progressive MP for Mackenzie riding in Saskatchewan, stood up in the House of Commons to deplore rumours that sinister Belgian interests might soon buy control of Canada's Eldorado in order to maintain their world monopoly, he used the rumour to argue for the intervention of the government in the radium business. But after starting out well, Campbell was almost literally side-tracked when he suggested that development of Great Bear Lake should be postponed until a

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railway could be built in order to furnish a cheap link between the prairies and the Arctic. That would save $4000 of the estimated $10,000 cost of producing a gram of radium, figures that he had derived from the Department of Mines' own reports. A galaxy of left-wing opposition figures followed, demanding that private enterprise be driven from the mining industry. J.S. Woodsworth, the Labour MP for a Winnipeg riding, suggested that LaBine could be compensated for his trouble rather easily and that it was fortunate that the possibility of nationalizing Eldorado had arisen at this early stage, before unscrupulous promoters had had the chance to get their hands on his mine. Responding for the government, Interior Minister Murphy defended the present structure of the mining industry, and pointed out that speculative profit was justified by speculative risk. Most mines turned out to be nothing more than hot air sitting uneasily on top of a substratum of hope. The time and money that went into keeping the two together, Murphy suggested, was better spent by private enterprise rather than government.26 The debate terminated ingloriously when Ernest Lapointe, the respected Liberal MP from Quebec East, pointed out that the whole question was out of order, since the estimates for Indian Affairs and not those of the Mines Department were under scrutiny. Nobody, including the government, had noticed. The political furore reflected a genuine concern in the world outside. Campbell was able to quote editorials from the Toronto Globe and the Ottawa Journal, the latter a Conservative newspaper, in support of his position. General McRae, a Conservative senator, made a speech demanding immediate nationalization. In the summer of 1932, however, the Bennett government had other things on its mind and so did the electorate. Nationalization of Eldorado might arouse emotion, but not for long, and no one volunteered suggestions as to where the money would be coming from. Woodsworth's assumption, at any rate, that there was little beyond prospecting costs was already far out of date. The LaBines took the view that their mine was amply proved, and that its prospects were excellent; given the encouragement and support they had received from the Mines Branch, this was not an unreasonable deduction. Work on the surface would proceed in

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the summer of 1932, but it was high time to sink a shaft. Two Junkers diesel engines were ordered, two power compressed-air drills, and a hoist for the shaft. Tested in Haileybury, they were shipped north in July. Work on a refinery would start immediately, Eldorado's board decided during the winter. By summer, that project, too, was under way. Eldorado's stock also reflected the optimism its promoters felt. The highs and lows for the year 1932 were $1.60 and 76 cents; never again would the stock go as low as the 18.5 cents it touched in 1930, or the 20 cents it managed in 1931. The company was considered sound, even by the Financial Post, which continued to keep a jaundiced eye on the management of mining companies. Eldorado, it nevertheless reported in September 1932, was 'an intelligent, well directed, amply financed effort,' but it had still to prove itself. For that reason, its future was no better than 'vague.'27 At that, Eldorado's rating was far better than those of the hundreds of syndicates that now sprang up. Great Bear was the best thing around in the spring of 1932. Stories of what would happen in Canada's north got as far as the New York Times, which sent up a reporter to investigate. 'Miners ready to fly into radium Eldorado,' he duly informed Times readers. A veritable 'aerial stampede' was predicted, using Waterways as a base. The Times story was already out of date. The stampede had not waited for spring.28 The Great Bear radium rush occupied most of the year 1932. All accounts agree that 'literally hundreds of small syndicates' appeared to finance prospecting parties into the Territories. Some were based in Edmonton, others in Winnipeg, still others in Toronto. Not all were directly engaged in mining. Transport was the first essential for this rush, because the cost in time and risk in weather meant that few would care to venture in entirely on their own. Three routes were available. Starting from Edmonton it was a 24-hour train journey to Fort McMurray, Waterways' railway twin. Then the prospector could transfer to an airplane, at the cost of $2000 for a return journey to Great Bear Lake. Or he could opt for the water route. The water route, in turn, had two possible destinations. Rae, at the northern tip of Great Slave Lake, was also an airport of sorts, and an airlift, at lower cost, was possible from there for the last 200 miles to Great Bear Lake. It was also possible

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to retrace the route of Charlie LaBine and Shirley Cragg in 1930, and take the all-water route via the Mackenzie and Bear rivers. Canadian Airways, Spencer McDonough Air Transport, and other aviation firms took in many of the individual prospectors. Other companies, like CM&S and NAME, had their own aircraft. The Hudson's Bay Company had a dominant but not exclusive position in water transport; and to cash in on the gaps left by the great company an Edmonton entrepreneur, Cy Becker, formed a new company, which he called plainly and appropriately Northern Transportation. In its first year, 1931, it had operated a floating box up and down the Mackenzie. In the second year, it used a schooner, the Ogyuk, originally built by the Inuit downriver at Aklavik. The concentration of all this prospecting effort had some beneficial side-effects. There was now a definite demand for fuel oil, and to satisfy it Imperial Oil reopened its capped wells near Fort Norman. Ultimately Eldorado would have a supply of diesel fuel close at hand as a result of this decision. Shipments inbound were likely to contain both a greater and more predictable quantity of freight, as well as a greater variety of products. As a result, life eased somewhat on Great Bear Lake, and shipping costs lessened. Only a minority of the prospectors could have hoped to find uranium. 'Experienced miners,' one observer wrote in 1932, looked to silver or copper for success rather than the spectacular radium. 'One, of course, is expected to help the other,' he wrote, but realistically there was no great hope of a second Eldorado. That did not prevent speculators outside from mining the hopes and fortunes of investors. The most spectacular of the breed was Major Bernhard Day. 'He charmed investors with his manner and inspired confidence by laying claim to mining qualifications that a considerable number of people doubted he ever had,' in the view of those who saw him in the north. Journalists found Day an ever-flowing fount of stories. His company, Bear Exploration and Radium (BEAR), almost matched Eldorado in the attention it got. The most imaginative of Day's stories showed up as far away as London and Paris, where it was solemnly reported that Major Bernhard Day and Madame Curie had reached agreement on radium supplies. It took one of the Bennett cabinet to deny that particular canard; the fact that no radium had as yet been

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produced anywhere in Canada (it was December 1932) was considered irrelevant by the press. Over the next few years BEAR wandered in and out of trouble with the stock exchanges and securities authorities. Eventually it would topple into the limbo where most mining companies found themselves and with it would go most of the small syndicates that had hoped to find riches in Great Bear Lake.29 The centre of activities on the lake was not the LaBine mine itself but a small inlet five or six miles away on the north side of Echo Bay. Cameron Bay became the local headquarters of the Royal Canadian Corps of Signals, which established a wireless station there. The Royal Canadian Mounted Police followed with a small detachment. Two men, Vic Ingraham, an American army veteran who had been working at odd jobs in the north, and Gerry Murphy, a federal civil servant in the area, joined forces to produce Murphy Services, whose emporium at Cameron Bay handled everything from groceries to liquor. 'It was an open secret,' a local historian wrote, 'that bootlegging was one of their major activities and it was encouraged by pilots who brought in the supplies, residents who purchased it, and the local police who do not seem to have bothered much about it.'3° That was not the sum total of services at Cameron Bay. There was music, dancing, even a restaurant, and women of both the respectable and the available varieties. There was a mining recorder too, shipped north to handle the new volume of business. All in all, it was what the Financial Post approvingly said it was: 'A big country and a great field for the prospector.'31 V

The rise of Eldorado and the onset of the Great Bear Lake rush were the product of private initiative and government encouragement. Eldorado Gold Mines Limited, as we have seen, was a small, well-managed, speculative mining venture. Its investors approached it in that spirit, and at least some of them considered themselves well repaid by the responsible and straightforward way in which the LaBine brothers managed the company. A peculiar combination of circumstances put Eldorado at the

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centre of a field of pitchblende, which Gilbert LaBine was uniquely qualified to recognize and then to exploit. The Eldorado company did not rely on its own professional expertise. Until 1933, no professional engineer or geologist was associated with the company. Rather, it leaned on the services provided — indeed, freely offered — by the Government of Canada. In so far as the LaBines relied on anything other than their own knowledge of mines, minerals, and the north, it was on the information and services of the Mines Branch of the Canadian Department of Mines. Those services were remarkably comprehensive, extending from running a pilot plant for a radium refinery to an estimate of the market radium would have and the price it would fetch. Until 1932 the international radium market was controlled by one company, the Union Miniere de Haut-Katanga. That company doled out radium at roughly $70,000 per gram, a figure which some believed reflected a declining grade in the pitchblende it mined in its Congo concession, as well as a dwindling reserve of ore. If that were so, then the radium market was open to a bright and aggressive competitor which might, through competition, force down the outrageously high price of radium and thereby benefit the cancer sufferers of the world, for whom radium offered the best if not the only hope of a cure. As soon as Eldorado's radium find was known, the Government of Canada in fact faced a certain amount of pressure to take control of the new mine in the name of humanity and social justice. When the Mines Branch devised a method of refining radium that was assumed to be both shorter and less costly than the Belgian method, its discovery had a major, and favourable, impact on opinions then entertained of Eldorado's economic viability. There was no need for the company to assume either the salaries or the capital equipment of the research and development team in Ottawa. The Government of Canada itself seems to have placed its support behind the radium project, and its scientists had no doubt that their discoveries would be highly regarded throughout the metallurgical world. It is doubtless belabouring the obvious to state that Eldorado in 1932, when it made its final and fundamental decision to get into the radium business, expected to make a profit. It expected to

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make a very considerable profit. On what basis did it make its decision? Union Miniere, in keeping with common European business practice, did not disclose very much about its operations. It was generally assumed that in the early 19205 it took about 20 tons of Belgian ore to make one gram of radium. If the Belgian grade had declined since then, it would take 40 tons in the early thirties to achieve the same result. LaBine's ore would produce radium with only 10 tons of input, if its grade kept within the 40—55% range which, as we have seen, was lower than the analysis of the first two LaBine Point samples in 1931. Those 10 tons were estimated to require 30 tons of chemicals for treatment. To that could be added transportation and labour costs. Reserves of ore at Great Bear Lake were estimated at 2000 tons by government geologists, and that, it was thought, would yield 200 grams of radium, at $50,000 per gram, or a $5,000,000 total. This admittedly crude reconstruction of the economic circumstances in which Eldorado entered the radium market may not do complete justice to the facts and reasoning available to Gilbert and Charles LaBine in the winter of 1932. It seems probable, however, that they must have entertained some such picture of their economic world in order to decide, as they did, that it was worth the risk of cashing in their carefully managed treasury. Their assumptions appeared rational. There was only one problem: almost every one of these assumptions was wrong and certainly the most erroneous of the assumptions was the one concerning the average grade of ore that would be available for mining. This miscalculation was the principal factor in the poor earnings performance of the company and, more important, in its inability to compete successfully with the Belgians.32

2 Northern Lights

Between 1932 and 1940 Eldorado Gold Mines Limited grew in virtually every respect. Its output soared. Its staff doubled, doubled again, and did not stop there. It excavated a mine, built a refinery, and bought its own transportation company. Its owners, the brothers LaBine, became legendary pioneers of science. They dined with the governor general and the prime minister in Ottawa, and reciprocated the hospitality when the governor general came to visit their mine. Other things grew too. But if more money came in, more was spent. It cost money to create a mine, and the money was borrowed. Shareholders were attracted by the bedazzlement of science, and by a sense of participating in and profiting by one of the wonders of the age. Again and again, Eldorado's shareholders were told that prosperity, and a dividend, were just around the corner. Again and again, however, prosperity and profits were postponed. Some things remained constant. Eldorado in 1932 was a LaBine promotion, and it remained one in 1940. Gilbert and Charlie traded positions, Gilbert becoming president, while Charlie took on Eldorado's transportation subsidiary. Members of the board of directors came and went, and other officers of the company changed about during the decade of the 19308. Some of these changes had great significance, and we will examine them later. As the new year 1932 dawned, Eldorado owned little beyond a few holes in the ground. It was sustained by a carefully husbanded,

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but small, treasury. It was buoyed by the hopes of its president, Charlie LaBine, and its managing director, Gilbert LaBine, and by their enthusiastic supporters in Ottawa. The best advice they had coincided with their own expectations, and those expectations led them to start serious development. This they did, at two ends of the continent, with the plain object of having both a mine and a refinery by the end of the year: 1932 would be the year of development, and therefore of expense; 1933, or at worst 1934, would be the first year of profit. I

The dominant features of life in the north are distance and climate. Distance rendered Great Bear Lake almost inaccessible to economical transportation; climate restricted the time available for development of the mine and reduced the resources that could be utilized. Virtually everything to sustain life had to be imported. The short growing season could not support vegetables, and meat was a seasonal event, dependent on the migrating caribou. Trees there were, and therefore wood, but that resource too was limited. And once cut, the wood was gone for generations, since the subarctic climate limited the rate of growth of the local forest. A trapper, an occasional trader, or a migratory Indian band could survive in such an environment. Sixty or seventy men, however, would place an intolerable strain on local resources, and the LaBines would need at least that number at the mine. The climate dictated when men could come in, and when they could be supplied. The hours of daylight made little difference, although daylight and darkness are the most immediately striking distinction between the Arctic and the south. In December and early January, darkness is almost perpetual; in June and July there is virtually no night. Paradoxically, however, navigation was not nearly as difficult in January as it was in June, since lights identified a settlement and a runway could be marked with flares. Winter and summer were the times when communications between Great Bear and the outer world were easiest; spring and fall were the worst. The reason for this seasonal variation is of course the progress of spring thaw and autumn freeze-up. At LaBine Point, during the

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19305, spring (and mushy, unsafe, ice) arrived between 10 April and 20 April. The first plane of 'spring' could fly in as early as 5 June (1934) or as late as 19 June (1936). The lake could be free of ice shortly thereafter, or as late as the middle of July (1933). The first boat would follow, though sometimes with a considerable lag. The navigation season lasted from mid-July until the first week of October, when the last boat pulled out for Fort Franklin and the outer world, and freeze-up would occur about a month later, in early November. Until the ice firmed up, no aircraft could land thereafter, and often it was a race between the cold and Christmas that determined whether the holiday mail would find its way in.1 The climate that prospectors and explorers found when they got to Great Bear could be surprising. The highest temperature in 1935, for example, was 9O°F on 10 June; the lowest, a moderate -i3°F, on 30 March. The next year was cooler, with the highest temperature on 28 June a mere 7o°F, and the winter was closer to the outside world's expectations, — 5O°F on 5 February. Generally, the climate ranged from temperate to hot during the brief summer, and shirt-sleeve weather was not uncommon. It never got hot enough to permit swimming in the lake; Great Bear stayed at a discouraging 34° or 350F at the best of times, and even a dash across LaBine Bay was a feat for the exceptionally brave and foolhardy. Boating and fishing were the most that the environment would yield, and that was not a little. No description of Great Bear would be complete without reference to the dominant form of summer life: flies and mosquitoes. In this regard prospecting in northern Ontario and Manitoba was good training; an ability to resist the insects differentiated the proper northerner from the effete southern variety of Canadian. In one instance at least a potential investor at Great Bear was driven out by the swarms of bugs, and apparently decided to place his money elsewhere, a decision that was probably geologically as well as entomologically sound. In fact, as would soon become apparent, there were few mineral deposits around Great Bear that could be economically exploited. The great mining rush of 1932-3 poured a great deal of money into and around Great Bear Lake, but very few mines resulted. Apart from Eldorado itself, for all intents and purposes there were

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two properties where a prolonged effort to mine ore was made: BEAR, at Contact Lake, near Echo Bay, and the White Eagle Silver mines, south of Eldorado towards the Camsell River. It followed that Great Bear would not hold a large mining population for long. It followed, too, that development costs could not be spread over very many firms, and that services would be either few or expensive, or both. The first cost in setting up the mine was the importation of miners. The small crew of 1931 could be accommodated in tents, and as part of their labours they built a couple more permanent buildings, notably a bunkhouse. Without diesel or other generators, they could not begin to make a dent on the Pre-Cambrian rock beneath, but their achievements were nevertheless considerable. F.B. Watt, a prospector-visitor in the spring of 1932, praised the fact that Eldorado's camp had 'a real table with a real bench to sit on. And there was real coffee - as much as I could drink ... Topping off an oven-cooked roast of beef, it produced a sense of well-being which was entirely appropriate to our mood of celebration.' But the greatest luxury, to someone living below freezing and under canvas was 'standing upright under a roof again, and peering out through real window glass at the inhospitable landscape which had become our habitat.'2 Watt visited while Eldorado's works were still entirely above ground, as they continued to be until the machinery necessary for underground work reached Great Bear. That machinery, 600 tons of it, passed through Edmonton in July, for delivery to the LaBine camp early in August. It included diesel engines, sufficient to power a compressed-air system for drilling. It included the drills themselves, a two-compartment lift system for the future mine shaft, and a haulage system for the ore inside the mine. LaBine Point offered a favourable siting for a mine. For one thing, the mine did not have to be dug straight down, in a single deep shaft. There was a go-foot cliff about 100 feet in from the lake. On the shelf between cliff and water lay Number One vein (a vein is a mineral deposit set in a fissure of rock); above the cliff, 90 feet over the lake, were the outcroppings of Vein Number Two, while parallel to that, further inland and to the north, lay Vein Number Three. Number Two seemed to offer the best mineral

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values, as determined by diamond drilling (so-called from the diamond head on a hollow drill designed to extract a tubular core from the rock). It was, therefore, both cheaper and probably more rewarding to start with Number Two vein. Work therefore began on an entrance tunnel, or adit, into the cliff, inland from bunkhouse, storehouse, and dock on LaBine Bay. The aim of the adit was to intersect Number Two vein and thereafter to drift along it. (A drift, which can be a noun as well as a verb, is defined as 'a horizontal passageway starting from the outcrop and following the deposit.') Eldorado's adit was a drift as well, and it served other purposes too. Workshops and storage areas were established there. The mine shaft was run downwards from the adit rather than from the surface, and the lift machinery was located in a hoistroom (a mine lift is commonly called a hoist) in the adit rather than in a headframe on the surface. Eldorado's shaft had a two-compartment hoist. Fully developed, mine shafts require a manway, a set of ladders firmly anchored, connecting the underground with the surface. Then there is a skip, used for hauling up ore, and a cage, used for the men. Communication between underground and the hoistroom is through a kind of bell-pull. Each location has its own code, a particular series of rings, to signal the hoist operator. Compartments are side by side, though within a compartment it is not unknown to have two-level cages or skips, handy for speedy and efficient haulage, delivery, or pick-up, especially at the change of shifts. The first task, after driving the adit, was to sink the shaft. This was highly skilled work, and shaft sinkers rated a particularly high wage, as well as a bonus system based on the number of feet sunk. By 1937 the shaft had reached a depth of 500 feet, or 590 feet below the surface. From the shaft levels were dug which, like the adit, drifted along the vein. (A level may be viewed, roughly, as equivalent to the floor of a building above the ground.) The levels were 125 feet apart. If the mine were to be x-rayed from above, the levels would not be stacked one above the other; rather, as the mine deepened, the levels moved off to the north, following the vein. At each level there was a shaft station, 9 feet by 12 feet, while the drifts and cross-cuts (tunnels intersecting rather than following a vein) were 5 feet by 7 feet.

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The face where work was progressing was (and still is) called a slope, a term that probably arrived in English via the Dutch stoep, or step, to define a step-like area where successive layers of rock are cut away. Some stopes head downwards, but a more common practice, and the one followed at Great Bear, is to mine upwards, into the back, or roof, of the drift. Raises (openings upwards from a level) were carved out to connect one level with another and as work moved upwards waste accumulated below. The passageway being formed in this fashion was timbered to permit the recovery of ore, that is, to allow a free drop of ore from the stope to the passageway beneath, using the sound principle of making gravity do the work and thereby save expense and power. Running along the level under the stope was an underground railway consisting of ore cars, each one capable of hauling thousands of pounds of ore. At Eldorado in the 19308 these cars were hand-trammed, that is, moved by manual labour, from stope to skip, where the ore was dumped for haulage to the surface. Only in 1942 did Eldorado acquire its first underground engine to pull the ore cars. The method used to extract the ore was common to the mines of northern Ontario and indeed to most mines, whether above or below the surface: drilling and blasting. A drill would be used to carve out a patterned series of holes. A dynamite charge would be inserted in the centre, and a fuse set. The resulting blast would clear out what was called a 'round'; the rubble would be cleared away or mucked; and the process would start all over again. This technique established the rhythm of work in the mine. A shift would clear, drill, and blast. It would then be necessary to pause while the explosion's fumes cleared, after which work could recommence. Not all stopes moved at the same rate. A good driller could move rapidly, and he and his team would be bonused accordingly. Those less skilled would earn less money, and an incentive was thus established to weed out the incompetent and the slow, since the miners underground had scant incentive to tolerate the work of those less able than themselves. This system ratified the hierarchy of skills and experience within a mine. At the top came shaft sinkers and timbermen, who received the highest pay rates and bonuses. Then came the machine

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operators, the men who handled the drills, and after them their assistants and muckers, who helped set up the drills and cleaned out the stope of the debris left by the previous team. The drills the miners used were a development of the previous century, when steam-powered drills were used on such engineering marvels as the New York subway and the Mont Blanc tunnel. Steam power had had its limitations as well as its uses, for steam eventually condensed in the pipe, setting a physical limit on the extent or depth that such drilling could go. For that reason, compressed-air drills were developed, fed by a generator. The generator, if gas- or oilpowered, had to be placed on the surface, so that its exhaust would not pollute the already foul air of the mine beneath. Thus, running up and down the mine shaft was a compressed-air system that had to extend into the farthest stope and without which very little work could be done (the ratio between hand-drilling and compressed-air drilling was something of the order of 4 inches to 4 feet). The drills that the compressed air powered were both heavy and clumsy. No single man could hold them, and the variety most commonly used, called a leynor after one of their manufacturers, necessitated bracing above and below. The leynor was placed on a 4-inch steel pipe braced by wood blocks above and below, anchoring it in the stope. The drill sat in a 24-inch frame or cradle and slid in a groove, backward and forward; it moved in the groove by means of a hand crank. This drill could be manoeuvred to drill straight ahead or overhead; the compressed-air drill commonly seen on city streets worked only downwards which, as we have seen, was not a commonly used method of mining. Setting up and disassembling such a drill was no easy task, and impossible for any one man. So drilling was done in pairs; frequently there were four men with two drills working a stope. Eldorado's Great Bear mine, like many of Canada's small mines of the period, could not justify employing a professional geologist. It relied instead on the professional expertise of its mine superintendent, a Sudbury Finn named Emil Walli (trained in mining engineering), and his assistant, J.P. Ryan, and on the professional opinion of Fraser Reid, a consulting engineer from Toronto. Initially the lack of a geologist probably did not matter very much, since the Eldorado pitchblende-silver veins were clearly visible and

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easy to follow. If usual practice were followed, the superintendent or his assistant would descend to the slopes once a day and indicate the direction that work should take. Since mining engineers received some training in geology, they could send their men towards the most likely deposits without too much danger of going astray. The correctness of Eldorado's course seemed to be confirmed when Hugh Spence of the Department of Mines passed through Great Bear in August 1937. Even on the lowest level, he found 'pitchblende and silver mineralization similar to that exposed on surface, with grade of ore well maintained.' Walli in 1937 added to the mine's reserves by opening a second, exploration shaft about 4000 feet from the main shaft, at the head of LaBine Bay.3 Ore, when removed from the mine, initially went straight to the docks for crude sorting and then bagging for shipment. Sorting was done manually, something that was possible because of the high grade of the ore which made identification by sight and weight feasible. But the ore was not so rich that this process, called hand-cobbing, could go on indefinitely. A mill was in order, and soon one was being shipped in. Economics, and especially the high cost of transport, dictated that ore leaving the mine be in as nearly pure a state as possible, so that valuable resources were not used up in transporting useless chunks of the Canadian Shield. At the same time the purification process must not use up more expensive inputs than were absolutely necessary. The first input, however, was unavoidable. Setting up a mill on the shores of Great Bear Lake would require expert advice, and a professional was duly hired by the board of directors in the spring of 1933. The man hired was Eraser Reid, partner in the Toronto mining consultant firm of Footer and Reid. Reid, who would play a prominent part in Eldorado's development, was a well-known mining engineer with a special interest in milling. His reputation was such that the mere fact of his appointment excited interest. Speculation tended to dwell on the possibility that Eldorado had commissioned a thorough independent study that would finally justify its existence and its future, and that would vault it into the upper realm of blue-ribbon mining stocks. It seems safe to say that

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that was not the LaBines' purpose in appointing Reid. They wanted, naturally, his best professional opinion, but his assignment was limited in scope: he was to advise on how properly to go about setting up a mill.4 This he did, and in the autumn of 1933 the mill was erected. Production started in December 1933 or January 1934. Like other mills, it relied on gravity to do some of its work, and then an assortment of conveyor belts, crushers, jigs (machines designed to separate coarser and finer ores by shaking them under water and allowing the finer materials to fall through a screen), and tables. The mill relied on the differing specific gravities of the minerals in the ores to separate silver from pitchblende, and copper from either. Certain chemicals were used as reagents in the process, which was altered several times during the 19308 to render better-grade products.5 The results, in hindsight, were not particularly satisfactory. Metallurgists a decade later considered Eldorado's mill inefficient and wasteful; and later recoveries from the waste products of the 19308 (waste, or tailings, dumped from the mill into the lake) indicate that this was so. But it is doubtful if the Eldorado company at any time in the 19308 could have undertaken the development that would substantially have improved its output. The construction of the mill necessitated the hiring of a whole new category of employee, and by the mid-19308 the Eldorado mine, though still small by southern standards, was becoming quite a complex establishment. The mine was powered by three Britishmade Rushton & Hornby diesel engines. One ran the hoist and generated electricity for mine and camp (electrification was completed in 1936); another ran the compressor; and the third ran the belt drive at the mill.6 Fuel for the diesels was provided by Imperial Oil from Normal Wells near Fort Norman. With the exception of a lo-mile pipeline on the Bear River, the oil was carried in barges up the Bear River and across Bear Lake to Eldorado, which maintained a 270,000gallon storage tank to help handle its 300,000 gallon a year consumption. Reductions in cost of shipping reduced the cost per gallon from 50 cents to 33 cents by 1937, but that still represented a $100,000 fuel bill every year. Wages were another sizeable item (a very crude estimate yields a wage bill of at least $150,000 per

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annum). Capital costs for the mine and the mill were high and shipping enhanced them. There was food to pay for, medical services, and transport. And there was publicity, too. We shall now turn to what publicity did, and did not, do. II

During the 19308, Eldorado may have been the best-reported mining camp in Canada. Visitors, travellers, dignitaries ebbed and flowed along Great Bear's shores, or came winging in on pontoon planes briefly to sample the delights of the long summer evenings or the fishing offshore. The best-known visitor to the camp was Lord Tweedsmuir, Canada's governor general, who came in August 1937. 'I had a hut to myself perched high on a rocky knoll,' Tweedsmuir later told a British newspaper audience, 'with a blazing fire to keep me company.' The Eldorado mine, he happily reported, 'is the chief radium producer in the world.'7 Tweedsmuir's treatment represented the highest form of mining hospitality. He arrived at Great Bear with a company director in tow, and in his own RCAF aircraft. But others were almost as fortunate, and if they came in the summer they would most probably find good food, good weather, and good hospitality from a mine staff starved for company. In return, the happy tourists talked up the radium business, as Tweedsmuir did, or rhapsodized about life in the great north. The readers of Time, Travel, the New York Times, the London Times, the Sunday Times, Maclean's magazine and Saturday Night all learned about life in the north due, in some small part, to Eldorado's generosity. Edgar Laytha, a New York writer, found himself swept up by Harry Snyder, the same Eldorado director who brought Tweedsmuir in, and carried off to Great Bear in mid-winter. The result, North Again for Gold, is one of the purest and most successful examples of company romanticism. Laytha wrote, for example, of his arrival by air: Twenty men, jubilant but freezing, stormed the ship as she sat down. The smile of welcome literally froze on their faces. Despite themselves they made the most ludicrous grimaces. Some of them could smile only with the right corner of their mouths, some with the left; others had the lower

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lip twisted to the right and the upper lip to the left. They were like a carnival party. Their costume-designers had been Arctic Indians and Eskimos. The evening sun played on colored glass beads, arranged in fantastic and lovely flower patterns, adorning their elbow-length mooseleather gloves ...8

Laytha found, in his words, 'a hundred men and one woman.' This was roughly accurate: six months earlier the count had been no men and one woman. Like all mines of any size, the Eldorado camp had its 'staff,' the professional or semi-professional officers of the company, who dwelt in a 'staff house' with rooms to themselves, as opposed to the miners and mill hands who lived in bunkhouses. What Laytha found when he came — it was February 1938 - was a considerable improvement over what existed only a couple of years before, although we should make some allowance for his natural enthusiasm in gratitude to the company. At first, there was a single bunkhouse and cookhouse combined. This structure was erected back in 1931. It easily accommodated the small work-force of the time and it handled, without any great difficulty, the so-odd men working on the property in 1932. As the work-force grew, however, from 20 to 45 to 75, the bunkhouse became intolerable. One veteran of the mid-thirties has written his impressions of'a crowded ram pasture of a place, heated by a wood burning barrel heater. In winter frost was ever present along the walls and under the bunks' which filled every open space on two floors. Space was reserved in the centre for a table and benches, on which sat the participants in the perpetual poker game that seems to have been a permanent feature of mining camps. A 45-gallon drum without a top furnished drinking and washing water, carried up from the lake in buckets. Sanitation was some distance away, which produced problems. As Tiny Peet, the camp chronicler, described it, 'Snow had been banked around the bunkhouse and cookery about four feet in height. Here some of the men, if I can call them such, first thing in the morning and last thing at night would urinate, like dogs on a lamp post. This formed the most disgusting and revolting condition imaginable around the walls when spring came. The melting snow and running water oozed through the logs ...9

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Laytha found Eldorado food splendid. The food at Port Radium (Eldorado's camp was gradually acquiring the name) was 'better and more plentiful' than in 'military academies, prisons and monasteries.' There was 'white bread, brown bread, rye bread, sweet biscuits, lozenges, crackers, tea, coffee, diluted powdered milk, and artificial lemonade,' while on the table sat a hearty meal of'roast moose with kidney beans and green peas.' There are other accounts. Tiny Peet later described the food: 'The desiccated mineral deficient foods served by the company did not contain the required vitamins for good dental health. Numerous cavities started appearing in my teeth for the first time, and my gums would bleed when I cleaned them.' The ministrations of a travelling dentist tended to make things worse rather than better, and in any case the fillings he put in would fall out a few months later.10 Medical care was not quite so chancy. Eldorado had its own doctor, who also served as the public doctor for medical emergencies between Great Bear and the Arctic Ocean. It was, Laytha recorded, a restful existence, which permitted the doctor to sleep in until noon, if he chose. The average age of the Eldorado miners was low, and their propensity to sickness proportionately slight. The only other 'civilian' in the camp was Virginia Walli, the mine superintendent's wife, who had trained as a nurse. In emergencies, therefore, Eldorado could field a respectable small medical team. But emergencies were few and far between. The Wallis were the only married couple at Great Bear - indeed the only couple of any kind since the company steadfastly refused permission to bring in any other woman. This greaty disgruntled staff members who were accustomed to better treatment elsewhere, but Walli was strict on this point. As for the miners, no mining camp permitted married miners to bring their wives or families. To compensate, the Wallis took at least some meals in the dining hall, and it was probably Walli who was responsible for a considerable improvement in living conditions at LaBine Point. The company built a new two-storey bunkhouse in 1936 with central heating, running water, and even flush toilets. Food, however, was still 'deplorable,' in Tiny Peet's recollection, and his description tallies with what Laytha found so attractive. 'Native

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caribou and fish were the main source,' Peet recorded, 'supplemented with dried and desiccated vegetables, evaporated fruit and puddings for dessert.' As part of the improvements, a large refrigeration unit was attached to the cookhouse, whose dining room was spacious enough (28 feet by 45 feet) to accommodate the whole camp for special functions. The mine manager's house was the only non-communal dwelling. It nestled under a cliff down the shoreline from the bunkhouse and cookhouse. There was a modern, white-tiled kitchen, but the pride and joy of the house was a native stone fireplace and mantelpiece. Christmas festivities in 1936 centred on the fireplace, in which a fire burned brightly. The Wallis served the staff Christmas dinner, turkey and trimmings, with suitable refreshment. It was a mellow and sentimental occasion for staff members far from home. 'Life to most of us,' Peet later wrote, 'seemed to take on a new meaning. We were congratulating Mrs. Walli on her new home and thanking her for the hospitality of inviting us for such an enjoyable evening. Then, without warning, the floor gave way, the chimney parted at the ceiling. The heavy stone fireplace sank two feet into the muskeg it had been built on, taking the floor of the house with it. The heat from the fireplace had thawed the permafrost underneath the house and the fireplace had settled in the morass of mud and scum.'11 The Arctic had delivered a none-too-subtle reminder of Eldorado's geography. Arctic problems occurred elsewhere in camp, and most forcibly down the mine. J.P. Ryan, the assistant superintendent, described the lower edge of permafrost as 320 feet below the surface. That meant, on the mine's upper levels, freezing temperatures. 'Drill machines and water lines often froze up in spite of all precautions. Broken ore hang-ups, necessitating much re-blasting, were troublesome occurrences. Considerable labour was required to keep haulageways and ditches clear of ice formation.' On the adit level, hot water was piped in from boilers outside to assist drilling.12 If drilling through permafrost was bad, drilling beyond it was worse. The mine was never far from Great Bear Lake, but as long as it continued in permafrost the lake kept its distance. The day came, however, when the shaft broke through the lower edge of

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permafrost. One night, when Tiny Peet and two workmates went on shift they were lowering the bell cord and rope ladder towards the bottom of the shaft when below them they heard a splash. Shining their lights down they discovered several feet of water in the bottom of the shaft. 'The waters of Great Bear Lake,' Peet realized, 'were coming through the cracks in the rock and filling up the shaft.' What to do next? No one, it seemed, had any very clear idea. Walli, the mine superintendent, was away in Edmonton. Ryan, his second-in-command, was unused to problems of flooding. 'Pandemonium and confusion are always present,' Peet wrote, 'when difficulties arise. Here they were intensified by the shift leaders [the next layer under Ryan] being at loggerheads.' It did not help that there was only one pump in the camp, and that the power supply was insufficient. But something had to be done, since without a continuous flow of ore the mill would have to shut down, and without concentrate the company could not long survive. Bigger pumps were flown in, and special cement for grouting, the art of filling up cracks. From that moment in 1936 on, keeping the Great Bear Lake mine open would be a continuous battle between miners and lake, in the certain knowledge that when the miners stopped pumping, the lake would win. 13 As long as the pumps kept going, however, the ore flow to the mill, 75 tons a day, kept the mine going. By 1937, the mill was turning out 30 tons of pitchblende-silver concentrate and 20—30 tons of silver-copper concentrate. The latter material was sent to Tacoma, Washington, for smelting; the former was sent to Eldorado's new refinery at Port Hope, Ontario.14 Ill

Port Hope, Ontario, when Eldorado entered its life, was a pretty little town better known for its past than for its present. It was once, a former inhabitant wrote, 'known throughout the Dominion of Canada as "The Open Air Asylum'" a title it received from the large number of decayed gentry who paraded its streets or played on its golf course. Decades of intermarriage, according to this jaundiced observer, had produced a generation best described, in a local term, as 'batty.'15

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The citizens of Port Hope naturally did not subscribe to this view, though many of them, if pressed, would have conceded that their 'picturesque and progressive town' had seen better days. Picturesque it certainly was, a little city on seven hills, with an exclusive boys' academy, Trinity College School, squatting on the eighth. No one could deny that Port Hope had progressed, too, from the days when it was merely Smith's Creek, named after its founder, the hunter and trader Peter Smith, who set up a trading post where the waters of the Ganaraska River flowed into Lake Ontario in 1778. Even then, Smith was not the first inhabitant; an Indian village caled Cochingomink was there before he was, but the Indians gradually withdrew as white settlement along the Lake Ontario 'front' grew in the decades that followed. At the end of the War of 1812, Port Hope was briefly known as 'Toronto,' but in 1817 or 1819 (sources differ) the citizenry unanimously resolved to christen their town 'Port Hope.' 'No one seems to know why Hope was made the choice of the residents,' G.H. Armstrong, the historian of Canadian place-names, wrote in 1930, but it seems altogether likely that it was in honour of Colonel Henry Hope, a forgotten lieutenant-governor (1785-9) of the old Province of Quebec. Hope was held in high esteem by the United Empire Loyalists who settled along Lake Ontario, and applying his name to a pretty town was belated recognition. Henry Hope had never been to Smith's Creek, but his spirit - traditional, conservative, and dignified — may have come to dwell there.16 Government followed, with a post office founded in 1820, and then industry. Port Hope's largest industry was brewing and distilling, manufacturing 'the famous Port Hope brand of whiskey,' which was shipped to Montreal to be transmuted into more lucrative brands of brandy, rum, and gin. Settlement spread north from the lake up the valley of the Ganaraska, whose abundant water-power provided for local factories. By the time of Confederation in 1867, Port Hope boasted an array of small mills and factories, with brick row housing and some large mansions to house the workers and the proprietors. Two railways followed the lake through Port Hope, the Grand Trunk and the Canadian Pacific, and by the turn of the century their viaducts spanned the Ganaraska from east to west.

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The 18705 marked Port Hope's golden days. The town was, in 1871, nineteenth in size among the cities and towns of the new Dominion of Canada, with just over 5000 people. In the next decade the population started to fall, and by the twentieth century no one bothered to estimate where the town stood in relation to the rest of the country. Instead the town cultivated a rivalry with its hated twin Cobourg, ten miles east. Cobourgers returned the compliment, christening their rival 'Port Misery,' a derisive reference to domestic feuds within the town limits. For a while, around the turn of the century, Port Hope became known as a summer resort for rich Americans, who left behind some elegant mansions along Dorset Street, inland from and parallel to the lake. And there were, of course, the eccentrics, the 'batty,' who populated the 'open-air asylum.'17 During the 19305, Port Hope was a remarkably uniform, homogeneous, little town. Sixty per cent of the inhabitants boasted English descent, with the Irish and Scots lagging behind. The three main Protestant churches, Anglican, Presbyterian, and United, accounted for over 80% of the population; the Catholics drifted far behind. Those of the population who worked, in the early 19308, had a choice of three main establishments. The Nicholson File Company, a branch plant of an American firm established in 1894, the Mathews Conveyor Company (1919), and Crane Sanitary Products, makers of toilet furnishings, all took advantage of Port Hope's lakefront and railside location to set up shop. But like the rest of the province, and the country, Port Hope in 1932 was depressed. One of the town's smaller businesses, the Morrow Seed Company, took the opportunity to go out of business, leaving vacant its three buildings down near the Port Hope harbour, between the railway and the lake. In the course of time, these buildings attracted the attention of the LaBine brothers. The LaBines needed a place to set up a refinery. Its location would, as far as possible, be determined by economics. It would need power; it would need easy transportation; and it would need chemicals by the ton. The best, indeed the only, location in Canada with such a combination of factors was the valley of the St Lawrence River—Great Lakes system. The most favourable sites were all in

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Ontario: the Windsor—Sandwich area in the south-west; Hamilton, a steel-making city near Toronto; and the little town of Port Hope. Before a refinery could be set up, however, there remained one essential piece of business. Eldorado would have to hire a reliable chemical engineer with experience in making radium if it were to retain the confidence of its investors and maintain the quality of its product. Such people were not in great supply in North America. Instead, the LaBines looked abroad. On the advice of a friend in Timrnins, Charlie LaBine wrote to a radium chemist in May 1931. This man, so Charlie understood, had 'a process that is regarded as superior to those employed elsewhere' for treating radium. If that were so, the LaBines had ore testing at 40% U3O8 that might possibly be of interest. Suggestions on the design and cost of a possible radium-treating plant would be most welcome, as well as 'the cost of extraction per gramme of recovered radium, and the time it would take to treat the ore.' The letter ended with a qualified offer of employment, asking 'what remuneration you would ask and what credentials you could submit to us.'18 The recipient of this extraordinary missive, Marcel Pochon, was a Frenchman resident in the English county of Cornwall, where he directed a small radium-processing establishment. His plant had by 1931 seen better days, and so, presumably, had Pochon. Trained under Marie Curie's husband, Pierre, in Paris, Pochon had worked on radium all his life. He emigrated to England early in the 19208 to work for a company calling itself the British and General Radium Corporation, refining the ore of a uranium mine at South Terras. Local gossip made much of the mine, then and later. Its director, a German named Straus, suddenly decamped in 1929, 'taking with him,' so the police later reported, 'several thousand pounds worth of radium.' He was never heard from again. Straus's sudden exit left the British and General Radium Corporation in dire straits. Its operations contracted, some of its equipment was sold off, and its laboratory closed down. Pochon stayed on nevertheless, and even set up a new laboratory to refine such ore as Straus's operations had left on the surface. The mine itself was closed, and flooded.19 LaBine's letter was therefore of considerable interest to Pochon.

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The analyses the Canadian promoter enclosed with his letter were of great promise, the chemist wrote back. Not only was the composition of the ore definitely favourable, in terms of radium production, but at a 40% grade, Eldorado could recover one gram of radium for every 15 tons of ore. The cost for this recovery, Pochon wrote, would be £50 a ton (approximately $200) or £750 for the lot. That, of course, excluded such considerations as cost of administration, the depreciation of capital equipment, and interest on working capital. It also excluded the time required to set up a radium plant, say six months. And radium was not all. It might be possible to produce uranium, Pochon wrote, although that 'requires a special plant.' It was true that demand for uranium was small in Europe, 'so irregular that I have not produced any for years. But,' he added hopefully, 'there may be a better market in America.' Pochon also enclosed a list of his experience and qualifications. He had been working on radioactive substances since 1912, he wrote, and was skilled at manufacturing all sorts of radium products, such as 'luminous compounds, ointments, pads, etc., and filling needles for doctors and hospitals.' He had all the necessary equipment at hand, as well as good connections in the business. 'There is also a good demand for high grade Uranium ore,' he wrote LaBine, 'and if you were willing to dispose of some of your ore, I have ready buyers for it.' As to the question of his own services, Pochon refused to set a price without knowing anything about 'the conditions of living on your side.' But subject to negotiation, come he would.20 This trans-Atlantic correspondence continued into the summer of 1931. The LaBines explained the difficulties of setting up a mine in the Canadian subarctic to the distant Pochon, and Pochon told them in return what they would need to turn ore into radium. By July 1931, when the mine was producing close to a ton of ore a day, Charlie felt able to promise a personal interview to Pochon 'to fully discuss this matter.' In September Charlie again asked Pochon for his references and soon afterwards it was settled that Pochon would come to Toronto to discuss his, and the company's, future. On 2 March 1932, agreement was reached. Pochon entered Eldorado's service in return for a salary of $10,000 per annum. He would labour for Eldorado and only for Eldorado, unless he procured the

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company's consent in writing. Pochori cannily inserted a clause providing that his salary would continue to be paid should he succumb to radium poisoning as a result of his work. 21 Pochon returned to England to collect his family and came back to start work on i June. The Eldorado board minutes now take up the story. 'Mr. LaBine' - Gilbert - told a meeting of the board at the end of July 1932 that 'as Mr. Pochon had recently arrived in Canada and had commenced his duties, it was desirable to secure a plant for the refining of pitchblende ore and for this purpose, several of the Company's Directors had examined various places with this end in view. These Directors had finally agreed that a factory at the town of Port Hope being lots 366 and 367 on the east side of John Street, together with the buildings thereon owned by Charles S. Morrow, seemed suitable for their purposes and that this factor could be secured on a monthly rental of $150.00, plus the water rates, lighting charges and taxes for the period of ist August 1932 to ist November 1933, at which latter date the company would have the option of purchasing the plant for the sum of $20,440.oo.'22 The Morrow Seed Company, the owners of the Port Hope property, were willing to convey their entire establishment, including '75 bags Golden Eye Beans' and weigh scales, as well as its three buildings ('main,' 'new,' and 'metal warehouse'), to the Eldorado company. The Port Hope Council, for its part, indicated that the taxes would be about $530 a year (53 mills on $10,000 property) as long as Eldorado merely rented. If, however, the company chose to buy, the council would support a special by-law reducing the company's assessment from $10,000 to $8000 for the next 10 years. Taxes payable to the municipality, including business tax, would drop from $624 to $250 per annum. The reason for this generosity was not hard to find. The great event of 1931 in Port Hope had been the departure of a party of the able-bodied unemployed to work on Ontario's new Highway Seven north of the town. Suddenly there was a new company promising to 'employ 20 men with pay roll say $20,000' — not counting Pochon's salary.23 Pochon did not approach his task uninstructed. Ottawa's Mines Branch had been hard at work for over a year devising ways of handling Great Bear Lake pitchblende. Its estimate of how much

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radium could be recovered was remarkably similar to Pochon's — 163.7 milligrams per tonne of ore, which, converted to imperial measurements, worked out to a gram of radium for every 15 tons. The Mines Branch recommended two separate treatments for the two different kinds of pitchblende they had identified from Great Bear. That for 'carbonate-barite-gangue pitchblende' would involve a preliminary roasting at between 75o°c and 8oo°c to dispose of carbonates. Once that was done, the Ottawa chemists agreed, 'acid leaching could ... be carried out with complete safety.' The residue would then proceed through a series of acid washes, leaches, and filters until a radium-bearing concentrate was produced.24 Pochon, armed with a flow-sheet from Ottawa, turned his attention to creating a refinery to match. The first step was simple. Eldorado's chemist, one of his staff later wrote, 'arrived with two tons of laboratory equipment — crucibles, quartz vessels, all the materials he did not expect to find in Canada.' Much of the equipment, however, was aged, if not obsolete. It was glass rather than the more modern heat-resistant pyrex. The glass vessels, Percy Phillips, an ex-employee, recalled, 'couldn't stand the pace,'25 To hold the equipment — such items as furnaces, tanks, and piping were ordered locally — the main Morrow building was gutted. 'They had taken the middle floor out,' Phillips wrote, 'with the exception of about 20 feet of it, and they built the whole circuit, including radium and uranium, inside that area.' The circuit relied on an electric hoist to raise the ore residues (in the form of slurry, best described as a kind of thin liquid mud) up to the top, to start the process off. When the hoist broke down, as it often did, the slurry was carried up manually in buckets. A new power house was supposed to take care of the plant's demand for power, and a new boiler and steam lines were also installed. A crucial ingredient in the refining process was acid of various kinds. Some of it was on an upper level and employees continued to work underneath it. As Percy Phillips recollects, 'every once in a while that would boil over and you'd hear somebody yell, "Look out below!" You didn't want to be there because it was a straight drop right down to the bottom floor and people working down there would run for cover. That was boiling acid coming down.' The first stage of the Mines Branch/Pochon process separated

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the radium-bearing residues from those that carried uranium. A 'liquor' carried the uranium, while a 'sand' contained the radium. The liquor then became part of the uranium circuit (or the Uranium Department as it was later called). The solids, which at this point contained radium, barium and lead, entered the radium extraction system. The basic process is described elsewhere (above, p. 5). But it may be of interest to describe some of the quantities that went into the radium brew, as well as the costs of the process. The chemicals used were invariable: muriatic (hydrochloric) acid, sulphuric acid, soda ash (anhydrous sodium carbonate), barium chloride, and ammonia. These substances went in by the ton. Processing 24,000 pounds (12 tons) of concentrate in January 1936 took 20,240 pounds of muriatic acid, 2975 pounds of sulphuric acid, 26,100 pounds of soda ash, 180 pounds of barium chloride, and 4140 pounds of ammonia. All together, these chemicals cost $1176.49. The quantities of chemicals, all of which were shipped in from elsewhere in the Great Lakes region, weighed about double the tonnage of concentrate brought in from Great Bear. Although chemicals were the largest item of expenditure, they made up only about one-third of the total monthly cost ($3558.11) of the radium plant. And the cost of the radium plant did not include the expense of Pochon's fractionating laboratory - $1342.80 - in the same month. Such figures by themselves are meaningless unless related to the overall cost, over time, of radium production. An estimate prepared in 1944 covered the first 10 years of Eldorado's production. Between January 1933, when the refinery got under way, and December 1942, the cost of producing one milligram of radium was $4.08. Uranium, in the form of uranium (black) oxide, U3O8, cost $0.729 per pound, while silver cost $0.103 per ounce. Comparing these figures to Pochon's estimate in 1931 yields an interesting result. At the time Pochon indicated a cost of £750 ($3000) per gram, estimating concentrate to be 40% U3O8. Naturally that would not be the total cost (mining and transport would also have to be factored in), but even if the overall cost was as high as $10,000 per gram of radium produced, there would be a comfortable margin for profit. The multiplication of the figure of

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$4.08 per milligram by 1000 should, if the 1944 figures are accurate, produce a cost of just over $4000 per gram, on the average - not that far from Pochon's original estimate. It would seem reasonable, under the circumstances, to conclude that Eldorado throughout the 19305 was capable of producing radium at something like its original projected cost. The flaw in the calculation was the assumption that the concentrate produced would average 40% U3O8. As it turned out, the average grade of concentrate produced was very much lower because of the lower grade of ore available for milling. Treating the refinery's first decade as a unit, however, conceals the fact that production improved and multiplied as Eldorado gained in experience and expertise. In 1933, the first year of operation, the mine brought forth 74 tons of pitchblende. From these were rendered 3.021 grams of radium and almost 35,000 pounds of 'uranium salts,' yellow, orange, and black. The next year, 1934, production was actually down: 2.82 grams of radium and 27,748 pounds of uranium salts; 1935 was much better, with over 13 grams of radium; and 1936 better still, at 15. The year 1936 also marked the completion of Eldorado's first ounce of radium. A celebration was called for. A party of the distinguished, including Sir Frederick Banting, the discoverer of insulin, was shipped out to Port Hope from Toronto, and in their presence the last milligram to make up an ounce was sealed into a glass needle. Then the party entrained for Ottawa, where Eldorado hosted a banquet in recognition of the assistance the Mines Branch had rendered it. Silver plaques made from Eldorado's own ore were presented to Dr Camsell, the deputy minister of Mines, and to General McNaughton, the president of the National Research Council. The governor general and the prime minister, Mackenzie King, attended. King recorded what happened in his diary. 'The dinner was not a large one/ he wrote, 'but was one of the most interesting and memorable I have ever attended. Dr. Camsell gave an account of his early days in the vicinity of Great Bear Lake ... He was followed by Mr. Leigh Brintnell, a very bright young fellow, who gave an account of his first flight into the Great Bear Lake and territory about. Gilbert LaBine, who sat next to me, told of his discovery of the Eldorado Pitchblende deposits and he

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was followed by Mr. Pochon who gave an account of the history of radium, and the work of Port Hope Refinery.' Mackenzie King, who admired men of science, was greatly moved, but as usual on such occasions it was the mellifluous governor general, Lord Tweedsmuir, who rose to the occasion. 'His Excellency,' King wrote, 'made a splendid address contrasting European development from the Fall of the Bastille, which began the French Revolution, with the discovery of the Mackenzie Rive by Mackenzie in the same year and subsequent movements in this country towards improving the well-being of mankind ... I felt very proud of Canada, with what our scholars and men of science are doing.' King himself did not speak, something he later regretted. It was, he wrote, 'an occasion at which I really should have spoken.'26 The newspapers duly produced admiring accounts of what had occurred. It was a great day for Eldorado. It must have seemed altogether probable, to the well-wined and dined audience sitting around the banquet table, that 'Canada might shortly have control of the radium market of the world,' in the words of Dr George Laurence of the National Research Council. There was, nevertheless, a footnote in some of the news reports about Eldorado's triumph. The price of radium, the press learned, had fallen from $70,000 per gram to $33,000. The press did not speculate as to what this might mean.27 IV

When news of Eldorado's discovery of a radium mine first burst upon the world there was some consideration as to its implications for the world price of radium. Hugh Spence of the Mines Department, for example, told the press that he had no doubt that it would affect the world radium market, and his words were read with attention around the world. In Toronto, the members of the provincial Royal Commission on the Use of Radium and X-Rays, etc., took note. Their report, presented to the government of Ontario in 1932, observed that Spence had referred to 'the suggested monopoly in radium,' and quoted him approvingly as having said 'that if there were any such monopoly it would soon be broken by Canadian output.' If that

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were so, the commission concluded, 'the purchase of large quantities by the government of Ontario requires most careful consideration.' Two grams of radium, it estimated, were needed for each million of population. That would mean, for Canada, about 20 grams, an increase of only 4 grams over existing stocks. For more populous countries, the prospects were more enticing. Even if only the richer and more developed nations were considered as likely markets, it would still mean the provision of many hundreds of grams of radium. Before that could occur, Eldorado and its Belgian competition would have to produce them. Yet Eldorado's production in its first four years, 1933—6, was miniscule. An initial order from the Ontario Department of Health took time to fill, in part because there was nobody available trained in the delicate art of filling needles with radium. Even early in 1934, the situation was sufficiently unsatisfactory to cause the Ontario Minister of Health, Dr Robb, to tell the legislature that he had been obliged to rent a 4-gram radium bomb in New York City because he couldn't get it in Port Hope. He had, it is true, bought 740 milligrams of the Port Hope product to date, at $52 a milligram, a modest increase in the company's fortunes, but that by itself would not be enough. The slowness of production and the small quantity of saleable products meant that Eldorado was soon facing cash-flow difficulties. In anticipation, Gilbert LaBine obtained the directors' consent to sell off Eldorado's remaining unissued shares. The operation was skilfully conducted during the spring of 1933, and when it was finally announced in July, 111,618 shares had been sold. The news the Financial Post reported, 'caused a distinct shock in many Toronto mining circles who believed the company to be amply financed' without any further dilution of its stock. But LaBine estimated that 1933 would see $100,000 spent on Great Bear and $70,000 on Port Hope (the agreement to purchase the Morrow property would soon come due), and without further cash the company would face certain problems.28 It was considered to be a hopeful sign that 1933 also saw the appointment of Eraser Reid as Eldorado's consulting engineer. That news may possibly have contributed to a boom in Eldorado's stocks in mid-July, when the stock rose from $4.80 on a Saturday to

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$8.10 the following Monday. The beneficiaries appear to have been the group to whom LaBine sold the 100,000 odd shares; as the Financial Post commented, the transaction was shrouded in mystery, but if the original purchasers 'handed the Canadian speculator their holdings at Monday's price of $8.10 they made a cool $500,000 for their week's work.' All in all, the Post warned, the boom did not reflect real value but 'unnatural influences ... at work.' 29 The truth about Eldorado's position did not dawn until the company's annual meeting in May 1934. By then, it must be underlined, there were shareholders who had purchased shares at prices between $4 and $8. These shares were now in the descendant, and their owners were understandably anxious for news, such as the proclamation of a dividend, that would justify their investment and, better still, allow them to pass it on. The best hope seemed to lie in Fraser Reid's mission to the north. Reid was a silver expert, it was reasoned, and so the silver occurrences at Great Bear must be worth his attention. The news in Eldorado's annual report for 1933 was, therefore, a bitter disappointment. There was a net loss of $62,188. Expenses at Port Hope were $32,665, and expenses at Great Bear were over $92,000. The minutes of the annual meeting of Eldorado's shareholders at Toronto's King Edward Hotel on 7 May 1934 do not do justice to the occasion. First, shareholders directed their outrage at C.S. Bowers, the company's auditor, whose resignation was demanded by some. When, eventually, the company directors got the financial statement passed, LaBine tried to change direction by outlining the 'proposed future developments' at Great Bear and Port Hope. That did not deflect attention from the unpleasant present when Fraser Reid took the floor to give what the minutes called 'a few impressions of his visit to the mine.' Though the minutes do not say so, what Reid told the meeting was that expectations based on silver were exaggerated, and that even at the very most Great Bear was 'not like Cobalt.' More money, he told the meeting, would be necessary for Great Bear Lake; no money, obviously, would be coming out of Great Bear Lake for the foreseeable future.30 In 1934, Eldorado's stock dropped back to 86 cents a share. It

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would never approach $8 or even $4 again. It is not surprising that some of the investors who bought in the grand speculation of 1933 felt that the company owed them something, and that if it could not pay now, it would perhaps pay later. In the ordinary course of events, if Eldorado had remained an ordinary company, they would eventually have swallowed their disappointments and used their stock certificates to paper their clothes closets. But Eldorado would not remain an ordinary company. Clearly Eldorado could not go on losing money. Following the principle that it would have to spend money in order to make some, the company embarked on a program of improvements at the mine and the refinery. Most notably, however, it tried to fill in a gap in its operations between mine and refinery. The first stage came in October 1934 when Gilbert LaBine told his board that he had been negotiating with the Bellanca Aircraft Corporation of New Castle, Delaware, for the purchase of a Bellanca Cargo Aircruiser. He and his friend Leigh Brintnell had inspected the aircraft and found it satisfactory and therefore he recommended the purchase. There may have been some dismay at this initiative, since there was no obvious source of funds for LaBine's proposition. Charlie intervened to suggest that if the company could not afford it, the LaBines could, and would therefore agree to lend the company whatever money was needed, at 6%.31 This offer was accepted. Eldorado had wings. It also had boats. The story of Eldorado's acquisition of its aquatic arm may be briefly told. Transportation along the Mackenzie valley, as we have seen, was split between the Hudson's Bay Company, long dominant, and the much smaller and younger Northern Transportation Company (NT). Beginning in 1930 as a subsidiary of Commercial Airways, with the object of freighting gasoline along the Mackenzie to service the company's aircraft, the company expanded its scope in 1931 to general freight and carriage for other companies. It underwent a change of ownership in 1932 and again in 1934, moving from subsidiary to independent and back again to subsidiary, this time to a mining company, the White Eagle Mines. Its assets in 1934 were estimated at about $65,ooo.32 The presence of Northern Transportation as well as the increased

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freight volumes into Great Bear Lake was highly beneficial to Eldorado. Writing to the shareholders on 22 June 1936, Charlie LaBine estimated that 'water transportation costs have been reduced approximately 50% since 1932,' although part of the improvement was owing to the dominion government's program to improve docks and portage roads along the Bear River. During 1936 (the exact date is unclear), the LaBines purchased Northern Transportation. Eldorado in June 1936 assigned 50,000 shares of its holdings in Gunnar Gold Mines, another LaBine promotion, to Northern Transportation as security for its debts to the former company. In December, the board proceeded to purchase Northern Transportation outright, paying the LaBines 50,000 shares of Eldorado stock.33 Expansion into transportation was only part of the company's plan for self-improvement. There were, as we have seen, additions to the mine; and there would be additions to the refinery. Marcel Pochon, a director since the resignation of Shirley Cragg in 1934, explained that expansion was essential if Eldorado was to meet all the orders coming in for its radium. And, given the rate of production at the refinery, it was clear that he was right. The questions of marketing and markets will be dealt with below. But, as we have seen, the price of radium was sinking. If expansion was necessary, and none would deny it, where was the money for the expansion to come from? Not from profit, though revenues in 1935 were greater than expenditures. Once again LaBine tapped that great vein of sentimentality and incurable optimism that runs through the community of mining investors. The decline in the price of radium was a sign of success and strength, he told the world, not to mention virtue, since now more people could afford to be treated with radium. Reports from the Great Bear properties were favourable. The value of ore reserves now totalled $10 million and that ought to be enough to tempt any investor, especially when all that now had to be spent was between $3 and $5 million. What followed is now impossible precisely to decipher. It is undeniable, however, that a new investor was found, and that his name was Harry Snyder. Here let us turn again to Eldorado's bard, Edgar Laytha. 'At this dark hour,' he wrote, 'a hand was reached

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out to the prospector from Chicago. The dynamic personality of the oil magnate Harry Snyder flung its shadow' over Eldorado's mines and markets.34 The deal between Snyder and Eldorado seems to have been negotiated in the summer of 1936. When the shareholders gathered for their annual meeting at the Royal York Hotel in Toronto on 14 July 1936, they were asked to approve a motion to increase Eldorado's capital stock from $3 million to $4 million. Out of the increase it was proposed that 600,000 shares be sold at 95 cents a share, and that current shareholders be permitted to buy 300,000 shares at the ratio of one new share for every 10 old ones, failing which an underwriter would 'agree to firmly purchase any shares not taken up by the shareholders at 95 £ in consideration of which the underwriter would be given an option for a reasonable length of time to purchase the other 300,000 shares at 95^ per share.' That motion passed, and the next was to elect a new board of directors. The list of directors was unsurprising; the greatest change was the appearance of Harry Snyder, underwriter, as a board member.35 What did Snyder do, exactly, to earn his directorship? He probably risked very little of his own money, though he was, as underwriter, called on in the fall of 1936 to pick up 247,231 shares that the existing shareholders had not wanted to buy. T am a borrower and not a lender,' he told journalists. Organizing other people's money was second nature to Snyder. Organizing it for Eldorado was no great problem, especially since the Chicagoan seems to have enjoyed more than the usual quota of enthusiasm and organizing ability. At first Snyder was the only new presence on the board. Later, in 1938, two other members of his syndicate, Charles B. Bohn of Detroit and Irving Babcock of Pontiac, president of General Motors Truck, were added.36 Shortly after Snyder's accession to the board, Northern Transportation was bought. Two ships were ordered for NT'S new river fleet, the Radium Line. The Radium Queen and the Radium King, built at Sorel, Quebec, and shipped across the continent, made their appearance in northern waters towing a fleet of ore-carrying scows, named Radium One through Radium Twelve. The mill at

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Great Bear was expanded and improved. And at Port Hope the ex-seed company buildings were altered and replaced. It was, Percy Phillips remembered, a time of improvement. 'There weren't any rubber gloves or protective clothing until 1937' at Port Hope. 'This also went for showers. And there wasn't enough hot water for showers anyway because they only had a 500 gallon tank and this was for the process and once you filled a tank you were through with hot water for quite a while.' It wasn't that Pochon wasn't safety-conscious. 'We were warned of the hazardous effects that might result from long exposure to radiation,' Tiny Peet wrote of a summer spent at Port Hope, in 1937. Pochon had a tendency to stress 'the possible sterilization effect' radiation could have 'on human beings.' Phillips's recollections agree. 'We knew radiation wasn't good for you,' he later stated. 'But Mr. Pochon made the statement, I think, that as long as it didn't lay around longer than 30 days and you kept it moving it wasn't going to be too bad.' As money became available, lead shields were put into the fractioning laboratory, and 'lead aprons and lead protecting the operator.' Mr Pochon apparently didn't believe in 'that silly stuff.' But believing in it or not, he installed it, and consulted with both the Ontario health department and the National Research Council on what else should be done.37 If health protection was improving, so was production. The Financial Post's survey of the Eldorado company, dated May 1938, noted the change. At Port Hope, 'All the buildings have been completed and were to be in use by May 15, 1938.' The new chemical plant had a capacity of three times the old one which had been dismantled. The refinery's productive capacity would now grow up to 9 grams of radium each month, though that level was not expected to be reached before November 1938.38 The result was indeed an improvement in Eldorado's rate of production, although inevitably it did not reach the lofty figures predicted. In 1939, according to Pochon's laboratory records, just under 34.5 grams of radium were produced - or a bit less than 3 grams per month. In the best month, June 1939, just over 5 grams emerged from the laboratory.39 From hope deferred prior to 1937, Eldorado had moved to hope

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disappointed in 1939. It was clear that Eldorado would never be able to dominate the world radium market on the basis of its production. It was also a question whether Eldorado would play any role at all in that market, and if it did, on whose terms. V

The fact that the price of radium fell precipitately during the 19305 is beyond dispute. From $70,000 to $54,000 to $30,000 to $25,000 per gram, radium became ever cheaper between 1930 and 1937. This drop in price was celebrated in the press as proof positive of the success of Eldorado's entry into the radium market. In fact, it was a disaster for the company. It is difficult, if not impossible, to reconstruct Eldorado's sales and marketing arrangements between 1934 and 1940. Some facts, however, are known. The company's marketing arrangements got off to a rocky start with what was doubtless intended to be its most certain and secure market, the government of Ontario. Urged on by the Cody Commission, in 1934 the government contemplated a large investment in radium, but when the time came there were difficulties in getting an adequate supply from Eldorado. Pochon explained, with some embarrassment, that it had been impossible to find someone locally who could undertake the difficult task of filling platinum needles with their two-milligram radium load. That problem was solved by shipping the radium to England, where the needles were filled, and then bringing the result back to Canada. All this took time, and time was what the Ontario government believed it lacked. Accordingly, in March 1934, the government undertook to rent 4 grams of radium from the Radium Chemical Company of New York, a subsidiary of the Union Miniere, for $13,280. The rental was on a yearly basis, and represented 6% of the stipulated value of the radium, which was $50,000 a gram, plus insurance and incidental costs. The agreement would expire in March 1935, unless the government of Ontario decided at that time to exercise an option to purchase one-half gram of radium. Even more painful to Eldorado than the fact of the radium rental was the criticism that attached to Eldorado when Dr Robb, minister

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of health, explained to the legislature that the company, his first choice, had been unable to deliver the required amount.40 The situation had changed by January of the following year, when the Department of Health told its minister (a new one, since an election had intervened) that Gilbert LaBine could not supply the province's needs. Naturally LaBine hoped to sell his product outright, but if the province insisted, he would accept time payments or a rental arrangement. Compared to the Radium Chemical Company's price of the year before, LaBine's price offer was a bargain, radium at $41,000 per gram in the case of outright purchase. In making the decision to choose Eldorado over the Belgians, Ontario officials were not indifferent to local considerations, noting that from 1932 to 1934 Eldorado had spent $267,377.54 at Port Hope and $30,557.32 in and around Toronto. These figures were naturally brought to the government's attention by the company.41 And so Eldorado got the contract. Counting the price of platinum containers, Eldorado received $153,000 for 3.5 grams of radium, which went to feed a radium bomb at the Toronto General Hospital. Unfortunately for the LaBines, Ontario chose to pay over time, in five annual instalments. It was a prideful, if not entirely profitable, moment for the company. 'Hand Over Radium Valued at $155,000: Gives Toronto Hospital one of Largest "Bombs in World,'" the Toronto Star, a government supporter, told its readers. It meant that the Toronto 'bomb' would be an all-Canadian product used to treat deep-seated cancerous tumours.42 By 1942, Ontario hospitals were using 7.127 grams of radium: the largest single amount, 4785 milligrams, was at Toronto General Hospital, but there was some in Kingston, Hamilton, London, Windsor, and at the University of Toronto. Not everyone was satisfied; all but one of the hospitals deemed the amount of radium on hand insufficient in terms of its two approved uses. These were, of course, cancer treatment and the treatment of deafness in children. By December 1938, Ontario had spent some $750,00 on cancer control; by February 1940 it had bought $400,000 worth of radium. Most of this was spent at Eldorado.43 Ontario, with a population of rather more than 3 million, and hard hit by economic depression, could never be Eldorado's

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principal market; the same could be said for all provinces put together. The United States posed special difficulties, which we shall look at briefly below. The greatest opportunity seemed to lie in the United Kingdom, and more generally in Europe. The purchase of radium in Britain lay, after 1929, in the hands of the National Radium Trust, a quasi-governmental body. The trust saw its fortunes fluctuate in tune with the value of the British pound; and like other British institutions it was ready to lend an ear to the siren call of British Empire patriotism. When radium was discovered on British territory — Canada — the trust announced that it continued 'to follow with interest' the LaBines' efforts. Later, in 1934, the trust invited tenders for the supply of what it described as 'a substantial purchase of new radium.' Eldorado tendered, successfully. The British bought 1.25 grams of radium from Eldorado, and by March 1935 — when the Ontario order was secured - Eldorado had virtually completed deliveries to the United Kingdom by way of its needle-filling subcontractor, the British firm of Johnson Matthew & Co. Limited.44 The trust's radium requirements serve as a barometer of trends in radium practice. Medical opinion by the mid-thirties held that bigger bombs were necessary in cancer treatment, and demand for radium grew proportionately. During 1936, this meant that Eldorado's tender for radium won out over Union Miniere's in May (for 1533 milligrams), while in July Union Miniere's tender prevailed (1.3 grams). These amounts were insufficient to meet demand, in the trust's view. It was accordingly decided to turn to rental, because funds for purchase were also insufficient. Once again tenders were sought from Union Miniere and Eldorado, and this time Eldorado made the better offer. The company lent the trust 20 grams of radium in 1936-7, with an option to purchase. Failing purchase, the company would receive an annual rental of 5% per annum on the capital value of the substance.45 These rather dry statistics bespeak a lively competition between the Canadian company and its Belgian rivals. They help to explain the steady decline in the price of radium, and they indicate, as well, an even more unfavourable development from Eldorado's point of view, namely the British decision to resort to rental, and for sizeable amounts of radium, as a way of making ends meet. Tying

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up 20 grams of radium on a rental basis necessarily had a diminishing effect on Eldorado's current income. Combined with a declining price this did not promise well either for the immediate present or the immediate future. It may have accounted for the company's decision, in 1937, to send Harry Snyder to Europe to investigate the state of the art of radium and uranium sales. The first target of Snyder's investigations was the Eldorado company's British agent, the firm of J. Hodson & Co., located in the City of London. The Hodson firm had been adopted on Marcel Pochon's advice some years before, when Eldorado, as a later analyst pointed out, 'were desperately in need of an outlet.' The British company had had years of experience in the radium market, having acted as agent for the Union Miniere. But once Hodson established a market, the Union Miniere dispensed with its services.Acting for Eldorado, Hodson achieved some success in terms of volume of sales or rentals. 'We have never had more radium than his contacts in England could take,' Eldorado's corporate secretary wrote in 1937. 'Our orders have always exceeded our supply.' Utilizing a 'British is best' appeal, Hodson tried to firm up a British market. But as we have seen, competition continued, and the price of uranium continued to fall. The year 1937, when Eldorado produced almost 24 grams of radium, saw the price decline to its lowest point ever, $21 per milligram or $21,000 per gram, a far cry from the $70,000 of 1930 or even the $50,000 of 1934. At this price Eldorado's radium was still selling but as Carl French pointed out, 'Anyone can secure orders by always under-bidding.' Worse still, the 20 grams on loan or rental to the British handicapped any sales effort for 1938. Nor were sales to the British the only cause for complaint. The United States caused considerable concern, and in 1937 the company established a short-lived subsidiary, Eldorado Radium Corporation, to improve its representation south of the border.46 Snyder's mandate from the board of directors was to seek 'the advancement and stabilization of radium and uranium sales of the company.' Stabilization obviously meant price as well as market. But that British officials were unwilling to concede. There was, Snyder reported in the spring of 1938, a 'refusal to commit on the part of Government agencies or else a flat denial of any pro-

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gramme not based on price.' The British were enjoying the best of a free, competitive market in which the advantage lay entirely with the buyer; cries of pain from Eldorado and suggestions that competition would soon result in no competition had no effect. On the continent of Europe, things were even worse. Union Miniere underbid Eldorado on radium sales to Finland in the spring of 1938 by no less than $15,000 per gram. That took the price of radium down to $6000 or $7000 per gram, and at that level, Eldorado could not hope to survive. It was, Snyder concluded, time to sue for peace 'because we cannot stand a further 50% to 75% price reduction.' Arriving in Brussels, Snyder got an enlightening reception from Union Miniere officials. The Belgians laid on a tour of their facilities, drawing Snyder's attention to the 25oo-ton stockpile of 'finished uranium' (presumably oxide, although concentrates are a possibility) and the i8o-gram reserve of radium. Once Snyder had absorbed the magnitude of Union Miniere's material reserves, the Belgians explained the financial realities of their position. In Snyder's words, They are prepared to do either one of two things at once (I have ascertained through confidential sources that this is not sales talk). First programme: Immediately bid ($) 10,000 or less on all new business, the 10,000 dollars to be the maximum price, but in all cases of proposed business to rent to the prospect the radium required at a rate of 4% on the above price ... Second programme: Arrive at a convention with us on a price fixing plan with quote, we to retain our own sales organisation and independence.

'When you boys see all the facts,' Snyder wrote to the LaBines, it would be clear that Eldorado must accept the 'second programme' or, to put it more plainly, form a cartel with Union Miniere.47 The terms agreed between Union Miniere and Eldorado were extremely practical. Each company would retain its home market. The world in between would be shared on a 60—40 basis, with Eldorado getting the lesser share. Should radium sales in any given year pass 75 grams, Eldorado's share would rise to 50%. Prices were fixed as well, on a sliding scale between $20 and $35 per

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milligram. To regulate sales a clearing-house was established in Brussels; its operations also included the Czechs, whose Joachimsthai mine, known since 1918 as Jachymov, had kept going on a minimal basis through the 19308. Eldorado's own documents do little more than explain the company's side, and the final terms, of the cartel. Other evidence suggests that the actual idea for the cartel, and the final terms, came from Union Miniere's chief sales agent, a white Russian of Jewish origin named Boris Pregel. Pregel had started off training as a scientist, but like many others had found his career interrupted by war and then by the Russian Revolution. He fled to France by way of Romania and in the early 19208 formed a connection with the Union Miniere. Pregel was a person of some consequence in France, where he counted prominent politicians among his friends, but he was also a major figure in the small world of radium/ uranium research. 'Anyone can make radium,' Madame Curie allegedly once said, 'but only one man can sell it: Boris Pregel.'48 Pregel's talents naturally commended themselves to the sellers of radium, and it is only reasonable to assume that buyers took a rather different view. The British government and its agencies, the National Radium Trust and the Radium Commission, were dismayed by the sudden end of the buyer's market in radioactive products, and Pregel's name was not thereafter regarded with favour in the British Ministry of Health. That was a matter of slight consequence in 1938; it would become rather more important in 1941 and 1942. With the cartel's assistance, Eldorado could look beyond Britain to Germany, where the company peddled sizeable quantities of ceramic-grade uranium in 1938 and 1939. The initial results of the cartel were highly beneficial to Eldorado. Profits in 1938 totalled $338,717. But in 1939 they were down to $153,947. The reason was not hard to find: war broke out in Europe on i September 1939. Great Britain declared war on Germany on 3 September; Canada followed on the loth. All the belligerent powers imposed controls on imports, exports, and foreign exchange. Canada became the only trans-Atlantic country to join in the war, and when it did LaBine's hard-won market for ceramic uranium in Germany vanished. Profits descended again in 1940. At first Eldorado put on a bold

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front. Signs were favourable, the company reported in March 1940. The United States was replacing Europe as the principal market for radium, and because of the premium on the United States dollar (then 10%) the company was getting more for its product. Sales were continuing to the British as well and, best of all, uranium sales seemed to be up. On the down side, however, inventories were rising - a situation that somewhat belied the rosy picture painted of sales — and wartime controls had eliminated not merely Germany but any country bordering on Germany as a market. Eldorado now had a ten-page list of companies deemed to be trading with the enemy, and all intercourse with these companies was banned.49 The next news from Europe, though depressing for the allied cause, was initially interpreted as promising great things for Eldorado. On 10 May 1940, the Germans invaded western Europe, overrunning the low countries and then France. The Financial Post reported on 25 May that the German attack had not been completely unforeseen, since 'the Belgian Radium Trust' had announced that no radium had been produced at its factory since the beginning of the year. Now that its factory was occupied by the Germans, the Post speculated, its ore might go to Eldorado for refining. How it could be fitted in at Port Hope was a mystery, the Post concluded, for Eldorado was working full blast.50 The true story was known only to Eldorado's directors. The company had shown a profit in 1939, but in its expansion program it had accumulated a very considerable debt. The Snyder program of financing through sales of equity collapsed in June 1939, and Snyder himself was removed from the board of directors when it was discovered that he owned not a single share of Eldorado stock. Although Snyder's allies, Bohn and Babcock, remained formal members of the board for another year, they attended no meetings and were removed in June 194O.51 As of 31 December 1939, Eldorado had $415,000 in bank loans outstanding, $239,000 in sundry loans, and $234,017 in accounts payable. When sales figures for the first quarter of 1940 became available, they showed that sales were down on the average from 1939, although they were comparable to those of the unusually low

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first quarter of the previous year. The figures seem to have come as a surprise to the Eldorado board. As late as March, the board was conducting its ordinary business, listening to reports on attempts to collect Snyder's underwriting balance and on Snyder's suit against the company for failure to pay expenses he claimed to have incurred on its behalf. The annual general meeting in April approved launching a suit against Snyder should he fail to meet his underwriting commitments, while setting aside funds to fight Snyder's own lawsuit. The blow fell at a meeting of the board on 14 June. Charles LaBine acted as chairman in his brother's absence at the Great Bear mine. (Gilbert had succeeded Charlie as president some years earlier.) Sales figures were disastrous. The United States had not replaced Europe as a market. The inventories that the Post had mentioned in March were in fact very large, and there was no hope of moving them quickly. There was no telling how long it would take to sell them, 'even though no further operations were carried on at Great Bear Lake and at Port Hope.' At actual rates of sales, the concentrates currently stored at the mine, at Waterways, and at Port Hope would take 'at least five years' to dispose of. The conclusion was obvious. The mine must be closed temporarily, though it was understood that 'temporarily' might mean until 1945. Port Hope must be reduced to manageable proportions, and what was to be done there was left to Charles LaBine to work out.52 The news then travelled to Great Bear, where Gilbert made arrangements with the mine manager, E.J Bolger (who had replaced Walli that year), to shut the place down. Charlie undertook to explain to Camsell, deputy minister of Mines and Resources, just what had happened. 'Because of the spread of the war in Europe,' he wrote, 'more of our markets are being eliminated each day and, at the present time, we are left with a very small percentage of the markets we had prior to the war.'53 Charlie was soon busy with a partial shut-down at Port Hope, while Gilbert was preoccupied with the ticklish problem of 'temporarily' closing a mine with a high propensity to flood. Eraser Reid, who became a board member just in time to advise on the shut-down, suggested extensive grouting with cement. Since the cement had to be flown

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in, a crew remained on site until August to complete the work and then, sealing complete, they left. Two caretakers were all that remained of Eldorado at Great Bear Lake.54 VI

Eldorado's cycle was almost complete, or so it must have seemed at the time. From the brilliant promise of 1932 it had turned pioneer, expanded, contracted, and finally confessed that it cost the company more to stay in business than to keep it shut down. Eldorado was, to put it plainly, a failing business. Its debt load was high, and many of its assets virtually worthless. Better times could not be predicted with any confidence, and the best that could be suggested was to await the turn of events. How much would be left of the company after five years of suspended animation, no one could reliably say. Meanwhile, in court, the directors and former directors of Eldorado squabbled over the remains. What had happened? Eldorado had succeeded in its primary aim of producing radium. It, and the government researchers who advised it, had established a working mine, built a refinery, and sallied forth into the radium markets of the world to do battle with the Belgian monopoly, Union Miniere. At first, Eldorado's officials and those of the Government of Canada believed that competition would be only the prelude to the eventual elimination of the Belgians from the world market. They believed that the Union Miniere's ore reserves were dwindling, and that the grade of the Belgian ore was diminishing along with the reserves. These assumptions were false. As was later proved, Belgian reserves would last until 1960. The grade of the Belgian ore was not falling, but possibly rising. During the Second World War, Belgian concentrates assayed at incredibly high figures, sometimes as much as 80% pure U3O8, far beyond anything Eldorado could claim. It was convenient and even desirable that these facts not be widely known, since their publication might have made the high price of radium more difficult to justify. Far from negotiating from mineral weakness, the Belgians were sitting on top of radium supplies that dwarfed Eldorado's. Worse still, from Eldorado's point of view, was the problem of

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under-capitalization. The LaBines in 1931, 1932, and 1933, when they were excavating their mine and designing their refinery, made a comparatively little go a long way. That it was not enough was demonstrated when, in 1936 and 1937, they were obliged to replace and expand their facilities, meanwhile purchasing a fleet of ships and an airplane to bring their transportation and communications problems under control. The entrance on the scene of Snyder and his American syndicate temporarily improved matters, but even Snyder's considerable enthusiasm and flair for publicity could not compensate for the fact that the Belgians could afford to compete while, in the longer run, Eldorado could not. The Belgians' success in eliminating competition through the cartel agreement of April 1938 showed where the real power in the radium business lay. Union Miniere had a host of other interests besides radium. It had an international board, large investments, and the ability to bring its investors to its support or rescue, should the necessity arise. It demonstrated to Eldorado that it could bring the price of radium down to zero, if it had to, something that would send Eldorado's creditors flocking to bankruptcy court. Eldorado, therefore, had no choice but to make the agreement it did in 1938, but that agreement furnished only a temporary respite. The war disrupted the cartel and its operations. German conquests closed Europe to radium sales from Canada, while Britain, forced to concentrate all its financial resources on the task of winning the war, effectively dropped out as a market. At the same time, sales in the United States were disappointing. The decision to close the mine and reduce the refinery, made in June 1940, was inescapable, and, regrettably, logical. Born in misconception, founded in error, Eldorado's fate was not greatly different from that of a thousand other mining companies that disappointed the hopes of their investors. The LaBines had not run a bad mine, though it had its defects. Their mistake had been to run their mine at all.

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Interlude The Powersof theAtom

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UNTIL THE YEAR 1939 it is unlikely that Gilbert and Charlie LaBine had ever heard of the term physics, except as an abstraction lectured on in universities. The production of uranium involved a great deal of science, but science was geology, chemistry, and its cousin, metallurgy. Science was, above all, medicine, and it was ultimately because of its curative powers that radium had any value at all. The idea that the process could have been reversed would have seemed very odd; the idea that it would be uranium that could do it would have seemed stranger still. Uranium, in the 19308, was Eldorado's principal waste product. There were others, to be sure: noxious arsenate from the Bear Lake ore, cobalt, and silver. Uranium, however, was the most obvious and, it must have seemed, the most limited in its uses. Piles of it sat around the factory yard. More uranium waste was stored in silos left behind by Morrow Seeds, and still more was pumped or dumped into Port Hope harbour. Some uranium, it was true, was sold to ceramic works, including some in Germany. When Britain and Canada declared war on the Nazis in September 1939, Eldorado's best hope for converting 'ceramic grade' uranium into a profit-making product vanished. There were only a few other places that seemed to want the stuff. There were local art schools, who used it to enhance their red and orange pigments. There was the National Research Council in Ottawa, which was conducting experiments. There was even a request from Columbia University in New York City, which wanted uranium for some laboratories in its Department of Physics. Eldorado was duly thanked for making available 'large quantities of uranium oxide.' The thanks were directed to the Eldorado Radium Corporation, a title which suggests that relations between scientists and company could not have been very close.1 But what the scientists were doing with Eldorado's uranium would determine the future of the company. The abstract formulations of a generation of physicists in Cambridge, Berlin, Columbia, Rome, Paris, and Berkeley were, by the end of the 19305, pointing to a startling conclusion. It was possible, then probable, and finally certain that vast quantities of energy could be released by the manipulation of tiny, invisible particles - 'atoms.' The most useful atoms for this purpose, scientists had discovered, were the atoms of uranium.

g2

Interlude

T was brought up to look at the atom as a nice, hard fellow, red or gray in colour, according to taste,' Ernest Rutherford, 'the father of the atom,' once remarked. Every element was made up of atoms; and atoms, being basic, were immutable. This comfortable belief held sway almost until the end of the nineteenth century. Then, partly as a result of the Curies' experiments, it began to disintegrate. Radioactivity, they discovered, created enormous amounts of energy. When the rays emitted by radium, uranium, and thorium, another radioactive substance, were examined, they were found to consist of negatively charged particles, which in 1897 were dubbed electrons. There were, in fact, three kinds of radioactive emanations, labelled alpha, beta, and gamma. Alpha turned out to be positively charged, beta (electrons) negatively, and gamma consisted of electromagnetic waves, capable of penetrating very thick materials. Only heavy lead shielding or similar substances could halt gamma rays. The young Rutherford, when a student at Cambridge, took up the study of radioactivity. Moving to Montreal's McGill University in 1898, he continued his work in association with Frederick Soddy, an Oxford-trained chemist. The two men observed that atoms emitting alpha or beta rays threw off particles. By doing so, the atoms changed their composition. An atom of one kind could, therefore, become an atom of another kind. One element, through radioactive emissions, could become something else. 'Don't call it transmutation,' Rutherford cautioned Soddy. 'They'll have our heads off as alchemists.' Transmutation was precisely what had occurred. In terms of the periodic table, expulsion of an alpha particle reduces a substance's value by two, but the departure of a beta particle promotes it by one. This is called the law of radioactive displacement. Rutherford, who had returned to Manchester and then to Cambridge University's Cavendish Laboratories, had by the outbreak of World War i worked out a theory of the atom that is still accepted. Atoms comprise a positively charged centre, or nucleus, surrounded by a cloud of electrons carrying an electric charge equal to that of the positive nucleus. It now remained to probe the structure of these new-model atoms. This work was informed by a new discovery from Soddy,

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that not all atoms of a given element were the same. That is, they were chemically identical, but they had different weights or masses. Soddy named these variant atoms 'isotopes,' taken from the Greek for 'the same place,' referring to their common location on the periodic table. What this meant in terms of uranium was this: uranium consisted of a nucleus with 92 positively charged particles or protons, surrounded by 92 electrons negatively charged. Nearly all uranium atoms combined the 92 protons with 146 neutrons — a discovery which was made in 1932. Neutrons have no charge and are 'neutral,' thus creating the isotope uranium 238. Roughly 99% of the nuclei of uranium are uranium 238. The remaining 1% are either isotope U-235 (92 plus 143) or U-234 (92 plus 142). The study of nuclei required time, patience, and energy. It was not until 1934 that Madame Curie's daughter, Irene, and her husband, Frederic Joliot, discovered, as the British historian Margaret Cowing put it, that 'alpha particles had converted normally stable atoms into radioactive ones.' One element that seemed most susceptible was uranium, and after 1934 attention began to be concentrated on it. Physicists began to work on the problem of unlocking the infinite energy source that uranium was supposed to hold. In a curious way the solution was offered, not by a physicist but by a novelist and publicist, the British writer H.G. Wells. In 1914 Wells had published The World Set Free, a novel that predicted the discovery that uranium, by emitting alpha particles, could set off a chain reaction which would in turn be an infinitely greater source of energy than any chemical reaction yet produced. As the American physicist H.L. Anderson later described it, Wells understood that 'there was only one trouble with uranium radioactivity. There was plenty of energy, but it came out too slowly. The half life of uranium is a bit too long to make a useful amount of power, and so he decided that all that was needed was someone to figure out how to speed up that process.'2 It was this idea that occurred to a Hungarian emigre physicist, Leo Szilard, one day in London in 1934. Ernest Rutherford, by that time Lord Rutherford and a great international figure in the world of physics, had pronounced the idea of extracting energy from the atom to be the purest 'moonshine.' Szilard felt both challenged and irritated by Rutherford's bland assurance. Daydreaming as he

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crossed Southampton Row, near the University of London, he realized that if a neutron were absorbed and could produce two neutrons, a chain reaction would indeed be possible. Szilard was so excited that he took out a patent on his idea. Remembering, however, that in Wells's novel the immediate result of the discovery of atomic physics was a world war using nuclear weapons, he decided to keep the patent secret. This he achieved by assigning it to the British Admiralty, a war-making machine itself, but one that was, in Szilard's view, less likely than some others to abuse the process. The scene now shifted to the continent where groups of physicists worked on the possibility of splitting the atom. In December 1938, in Berlin, success was achieved. Reported to two German refugee scientists in Denmark, the Berlin test results were correctly interpreted to mean 'the breaking-up of a uranium nucleus into two almost equal parts. The picture,' one of the refugees, Otto Frisch, wrote, 'is not that of a "particle" breaking through a potential barrier, but rather the gradual deformation of the original uranium nucleus, its elongation, formation of a waist, and finally separation of the two halves.' Summarizing, Frisch explained that 'the picture was that of two fairly large nuclei flying apart with an energy of nearly 200 million electron volts, more than ten times the energy involved in any other nuclear reaction.'3 The news immediately travelled to the United States via the Danish physicist Niels Bohr, who in January 1939 created a sensation at the Fifth Washington Congress on Theoretical Physics. The phenomenon was christened 'fission' by Frisch, after the division of cells in biology. As Eugene Wigner, a Hungarian-American physicist realized, 'if enough neutrons are emitted in this fission process, then it should be, of course, possible to sustain a chain reaction; all the things which H.G. Wells had predicted appeared suddenly real to me.'4 It appeared real to others as well, and not least the press. 'Revolution in Physics,' the New York Times editorialized on 3 February. 'The amount of energy released is enormous,' it told its readers: 'Great news.' In its year-end review, in December, the Times returned to the subject. The splitting of the uranium atom was rated the number-one scientific event of the year. Repeating

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itself, the Times reminded its audience that splitting the uranium atom meant the 'release of enormous amounts of energy.'5 Joy at this latest scientific breakthrough was not unalloyed. That which released energy could also cause an explosion. What exploded could be used in war. Hadn't H.G. Wells predicted as much, and hadn't he been right so far? No one, especially refugees from Germany, could forget that some of the most advanced work on uranium was being done in Germany, and that the government of Germany was not to be trusted with the secret of nuclear fission. And so, at the dawn of the atomic age, politics entered the uranium business. The direct cause was fear: fear of Adolf Hitler, fear of the Nazis, fear of the madness of totalitarianism that was spreading over Europe. Already, in October 1938, German troops had occupied St Joachimsthal (renamed from the Czech Jachymov) and seized its uranium deposits. Germany was, as we have seen, a major importer of Eldorado's ceramic-grade uranium, and the British embassy in Berlin nervously noted the fact. By the spring of 1939, there was much concern on both sides of the Atlantic about what might be done with the atomic secret. Leo Szilard, by now at Columbia University, tried unsuccessfully to persuade his fellow physicists to conceal the results of their work. When the results of certain experiments in Paris were published in the British scientific journal Nature in mid-April 1939, British physicist G.P. Thomson was stimulated to consider whether something ought to be done about uranium. 'What I had in mind,' he wrote, 'was something more than a piece of pure research, for at the back of my thoughts there lay the possibility of a weapon.' For his investigations, Thomson decided he needed a ton of uranium oxide, or 'the amount that a pottery firm would use in a year.'6 Where could he get the uranium, and how? Thomson consulted the master of Corpus Christi College, Cambridge, and he in turn spoke to the local member of Parliament, Kenneth Pickthorn. Pickthorn asked the secretary of the committee of Imperial Defence, a subcommittee of the British cabinet. The secretary, General Ismay, referred the matter to Sir John Anderson, the Lord Privy Seal. By a peculiar coincidence, Anderson had trained as a scientist before embarking on government as a career, and his specialization many years before had been uranium. Alone among

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the senior politicians in Britain — or any other country — Anderson actually knew what the scientists were talking about. Ismay also referred the proposition to Sir Henry Tizard, a senior scientific adviser to the government. Tizard explained to the general that 'there was little doubt about the scientific facts' but there was also 'little evidence that the scientific results could be applied on a large scale.' Nevertheless it was a possibility that could not be neglected. In Tizard's opinion 'the possible outcome of research was so important that it was wise to take steps to investigate and if possible to secure an option on existing supplies [of uranium] and particularly to prevent them from being secured by possible enemy countries.' There were three possible sources of uranium, Ismay learned. One was now in German hands, and the other two were the Belgian Congo and 'Arctic Canada.' At the end of April, the British Foreign Office telegraphed its ambassador in Brussels to discover how much the Belgians had, whether it was for sale, and at what price. The answer was that at present the Union Miniere company had 65 tons of'crude material' (presumably ore concentrate) on hand, and this amount would yield about 30 tons of 'refined uranium' or oxide. Better still, the uranium was actually in Britain, in London, in the hands of Union Miniere's local agents. The price was 6/4d. per pound, or £19,000 for the lot (roughly $76,000 at current exchange rates). There were another 200 tons on hand in Belgium, An option to purchase was arranged. On 10 May, in London, Edgar Sengier, Union Miniere's managing director, met with General Ismay and Sir Henry Tizard. According to the official British account of their meeting, 'The President was very pleasant and helpful; and Sir Henry Tizard was perfectly frank about the whole business. This was fortunate,' the official minutes continued, 'since it turned out in the conversation that the President was in close personal touch with the Curie-Joliots [in Paris] who gave him precisely the same information.' What emerged from the meeting was 'a kind of gentleman's understanding.' Sengier revealed that he had despatched two or three hundred tons of 'uranium residues' from Belgium to the United States in order to meet 'the normal annual demand for the next three or four years.' If the British wanted to purchase large

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amounts of uranium, of the order of 100 tons or more, that might prove difficult because it was not possible to refine it quickly in existing facilities. To do that, it would be necessary to 'enlarge their plants.' Sengier agreed to keep the British posted on any abnormal demand for his uranium - obviously from Germany - and to consider shipping uranium reserves across the Channel to the British Isles. In the meantime the British government bought a ton of uranium oxide from Union Miniere's London agents for £709, 6s., and 8d.7 Sengier and, presumably, his senior officials were well informed about the possibilities of uranium, This is not surprising, given the close connections existing between the Union Miniere organization and the Paris laboratories where Frederic Joliot was in charge with his wife Irene. According to Sengier, when he left Britain after his interview with Tizard, he went to Paris, where he discussed the military possibilities of uranium with Joliot's Paris team. 'They proposed,' Sengier stated, 'to effect the fission of a uranium bomb in the Sahara. I accepted in principle, and agreed to furnish the raw material and part of the financing.' The first conscious attempt to create a nuclear weapon was the product of co-operation between science and private enterprise.8 By the summer of 1939, it was known, or at least suspected, that experiments were proceeding in both Britain and France, and that something was happening in Germany. What had been, until that year, the most 'international' of scientific explorations was becoming a series of tightly held 'national' secrets. Atomic energy was assuming some of the characteristics of a race, with the possibility that whoever won the race would use the results on everyone else. Certainly no responsible person doubted that Hitler and the Nazis would have any moral qualms about dropping a nuclear device on anyone who stood in their way; with war a virtual certainty that was no small consideration. It was in this atmosphere that Leo Szilard once again took the initiative. He drafted a letter for Albert Einstein, the great physicist, to send to President Franklin D. Roosevelt. This letter, dated 2 August 1939, asserted that 'it may become possible to set up a nuclear chain reaction in a large mass of uranium, by which vast amounts of power and large quantities of uranium-like elements

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would be generated.' It now appeared 'almost certain,' Szilard continued, 'that this could be achieved in the immediate future.' Unconsciously repeating what the British had said in the spring, Szilard noted that the United States itself had only 'very poor ores of uranium in moderate quantities.' The best sources were St Joachimsthal, Canada ('some good ore'), and the Belgian Congo.9 Uranium was the real crux of the 'Einstein letter.' Szilard had been worrying about the question, 'through what channels could we approach the Belgian government and warn them about selling any uranium to Germany?' It was this that led him to approach Einstein, who knew the queen of the Belgians. Discussions thereafter led to a decision to consult with the American government, and then to approach Roosevelt. But then, as Szilard wrote, 'August passed and nothing happened. September passed and nothing happened.' Another letter was sent, through the New York banker Alexander Sachs, this time specifically calling attention to the desirability of getting the Belgians to 'make available abundant supplies of uranium to the United States.' No one then realized that the abundant supplies were already there. This second memorandum told Roosevelt once again that the United States' own uranium reserves were poor. Canada's effective reserves were estimated at 3000 tons, and Czechoslovakia's at 1500 tons. It was also true that there was uranium in Russia, but the best-known supply was still in the Congo. Szilard again urged that a stock of uranium be procured from the Belgians, possibly as 'a token reparation payment from the Belgian government.' Szilard had forgotten — or did not know — that Belgium had been allied to the United States in World War i and did not owe the Americans any reparations.10 This time, however, there was a summons to Washington. There, three immigrant Hungarians - Szilard, Edward Teller, and Eugene Wigner - proposed to a committee under the chairmanship of Lyman Briggs, director of the National Bureau of Standards, that the United States government bless their uranium research. The Hungarians marched out with $6000 to spend on materials for their experiments. But nothing much happened thereafter. The winter of 1939-40 was the winter of the 'Phoney War,' with Britain and France confronting Germany across the Rhine.

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Neither side made any particularly significant move until spring, although there were several scares concerning Germany's presumed intention to attack France by way of its traditional invasion route, through Belgium. The British and French continued to work on uranium. To assist in their experiments the French procured a small amount of heavy water (deuterium, an isotope of hydrogen, plus oxygen) to use as a moderator to slow down the energy and speed of the neutron. Though on a small scale, the work accomplished that winter in the uranium field was crucial. Ordinary uranium oxide, G.P. Thomson discovered, would not work; no chain reaction could be produced. But it was possible that using uranium 235, an isotope of uranium, a chain reaction could be brought about. Indeed, a paper produced by Otto Frisch and R.E. Peierls in early 1940 concluded that a very small amount of pure U-235 would produce a very large amount of energy. This conclusion, coupled with some official news about the progress achieved over the winter in France, stimulated considerable interest in government circles in London. A subcommittee (later a full committee) was set up. It was known, for some eccentric reason, as the Maud Committee, a name with no particular significance. Events during the spring of 1940 promoted the Maud Committee's work to a position of first-class importance.11 On 10 May 1940, the long-awaited German blitzkrieg was launched on western Europe. The Netherlands, then Belgium, and finally France capitulated. Ahead of the advancing German armies moved a flood of refugees; inside the refugee stream were some of the scientists from the Paris project and their precious heavy water. Whatever success the French scientists could hope to have would now depend on the British government. Not all refugees travelled in discomfort. The Union Maniere had made prudent dispositions against calamity. During 1939 it had transferred uranium stocks to the United States. That summer its chief salesman, Boris Pregel, first set foot in America. Returning briefly to Europe to look after his family, he was back in New York City by the time the final military catastrophe overtook the allies in Europe. New York also received Gustave Lechien, a director of Union Miniere, and Edgar Sengier, its managing director. Awaiting them were several of Union Miniere's subsidiaries, principally

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the African Metals Corporation. They could keep going in business, but like Eldorado the uncertainty of the times caused Union Miniere to order the closure of its Shinkolobwe uranium mine in the Congo. Though Union Miniere had supplies of uranium in the pipeline at various points in the Congo, its principal supply was now sitting on Staten Island, in easy view of the towers of Manhattan. The fact of its existence, however, seems to have been unknown to its American hosts. That did not matter a great deal, for the Columbia University experiments could make do with existing uranium stocks, and in particular what could be procured from Eldorado. According to Szilard, writing in October 1939, 'it appears that this Canadian corporation might be able to supply uranium oxide for our purposes at the rate of i ton a week.' Eldorado's records for the period are scanty, and it is impossible to confirm any large shipments to the United States during this period. It is reasonable to suppose, however, that the bulk of the uranium used in American experiments came from north of the border, rather than from the Congo. British experiments, under the aegis of the Maud Committee, also consumed uranium. Eldorado's records for 1940 show a steady flow of uranium to its British agent, with a value of $40,640. A rough estimate would place the quantity shipped at about 10 to 15 tons of oxide. But British work in 1940—1 remained largely theoretical. Reporting to Sir John Anderson in the summer of 1941, the Maud Committee concluded that the theoretical possibilities of a bomb were now established. Better still, a bomb could be built in roughly two years. T wish I could tell you that the bomb is not going to work,' one of the Maud Committee's members, James Chadwick, told an American emissary, 'but I am 90 per cent certain that it will.' Such was the report of the Maud Committee, and such the conclusion of the British government.12 The Americans were told of the progress of Britain's uranium research. Their own work, though relatively costly, had not been as pointed, or as fruitful. The fact that the United States was not yet in the war constrained expenditures, and so did administrative confusion. Briggs was still responsible for uranium research, and in May 1941 his organization placed an order with Eldorado for

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eight tons of uranium. But their work was still small-scale and fragmented, and some of those specializing in uranium were still thinking in terms of energy and industry rather than of warfare and destruction.13 In the summer of 1941 two new figures entered the American uranium picture. Vannevar Bush, the president of the Carnegie Institute and former vice-president of the Massachusetts Institute of Technology, and James B. Conant, the president of Harvard University, assumed responsibility for mobilizing scienc for a war they believed could not now be far off. Uranium moved under the wing of a new organization, the Organization for Scientific Research and Development (OSRD). Briggs - though still on the scene — was on the way out. Bush and Conant were on their way in.14 Both the British and the Americans were anxious for the future. Scientists in both countries saw themselves in a race, not against each other, but against what might be going on in Germany. Bomb production was imperative, because what would happen if Hitler got the bomb first was unthinkable. It was not surprising that feelers were sent across the Atlantic suggesting a pooling of research and resources. In the fall of 1941 it was the British who, because of the quality of their theoretical work, held an advantage, and the Americans who sought to share. The British did not react very quickly to American prodding, and the opportunity lapsed to create a joint effort before the United States formally entered the war. War came to the Americans on 7 December 1941, when Japan attacked Pearl Harbor. Germany declared war on the United States four days later. The sleepy offices of Eldorado Gold Mines Limited in Toronto were about to enter the war effort - and more, much more, besides.

3 From Radium to Uranium

The relaxed state of Eldorado in the middle of 1940 did not mirror that of Canada as a whole. The desperate situation of the allied cause after the surrender of France and the loss of almost all the British Army's heavy equipment on the fields of Flanders and the beaches of Dunkirk meant that every effort had to be made to replace them. So desperate were the British that orders started to flow into Canada, three thousand miles and an ocean away. Every possible item of equipment was needed: planes, tanks, trucks, rifles, ammunition, and chemicals, as well as the chemicals, ore, and wood needed to make them. The Canadian government responded with an unprecedented mobilization of the national economy. Men were drafted for the possible defence of North America against invasion. Wages rose as companies with contracts competed for scarce skills. Young men and women drifted from the countryside to the cities, and from unpleasant and burdensome occupations to a better deal in the factories, or in the army. Logging, farming, fishing, and mining all lost workers. Finally, by the fall of 1941, the manpower cupboard was bare, and the government resorted to a stringent set of price and wage controls to keep inflation down and production up. It was not merely prices and wages that were regulated, but supplies — lumber, steel, petroleum products, machine tools, trucks, and ships. Eldorado was little more than an interested spectator as this

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spectacle unfolded. It had a couple of caretakers at the mine, and about 50 people working at the refinery, besides office staff in Toronto. Northern Transportation Company was still operating, of course, and the refinery was bringing in money; regrettably, the company's consolidated statement of operations for 1940 does not permit us to know in what way it was earning money, or where its 'gross income' of $747,489.67 was coming from. It is clear, however, that the net profit of just over $50,000 bulked very small compared to the outstanding loans (described as 'bank loans (secured)' and 'sundry loans') of just over $600,000. Indeed, the appearance in the balance sheet of mining claims at Long Lake, Manitoba, as well as the 14-year-old 'development expenses' incurred there might have stimulated deep thought about how Eldorado was managing to stay afloat. The deep thought, however, was confined to the company boardroom.As far as the outside world was concerned, Eldorado continued to live on its (and its founders') reputation and the hopes of its investors. It was, in any case, highly unlikely that the Government of Canada would give permission to such a non-essential company to reopen its mine until the war emergency and its consequent manpower and supply shortages were past. Needless to say, Gilbert LaBine did not stress this point in public; he was also keeping the mine, its equipment, and its supplies on the books as assets.1 We can only speculate as to what Eldorado's fate would have been if the company had been left to its own devices. But it was not. By the end of the war, the company had turned around. It belonged, not to the LaBines, but to the government. Its stock no longer traded. Instead of dickering with provinces and trusts over radium supply, Eldorado dealt with generals, high commissioners, and ministers. Most important of all, its credit was as great as that of the whole Dominion of Canada, to which the company now belonged. And power was no longer exercised by Gilbert and Charlie LaBine, but by a man called C.D. Howe. I

To arrive at this conclusion, we must go several steps back, to the summer of 1940. At that time, it will be recalled, the uranium

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business was flat and the sales of radium were plunging to disastrous lows. The old radium business had taken flight from its clearing house in Brussels to the United States, where Edgar Sengier, managing director of Union Miniere, and his lieutenant, Gustave Lechien, had decided to wait out the war. They had, ready and waiting, a marketing organization, the Central Trading Company, headquartered in Manhattan, as well as the more descriptive African Metals Corporation. Business must go on. Within a month of the French surrender, on 17 July 1940, Eldorado's board of directors was approving a contract negotiated with the Central Trading Corporation, providing for 'constant supply and delivery' of'uranium products.' Ray T. Birks, a lawyer and a new arrival on the Eldorado board, approved the contract and recommended acceptance, and it may well be that connection which kept the Eldorado refinery in operation all through the summer of 1940. The effects of the contract seem to have been to increase the company's summertime earnings and to permit the reduction of bank loans 'beyond our anticipation,' as the company secretary-treasurer happily reported in November.2 This was good news but not, it would seem, quite good enough. A favourable summer could only partially offset the effects of a catastrophic spring, nor would the fall do much more than allow Eldorado to break slightly better than even. Nor, as we have seen, were the medium-term prospects of the company in wartime Canada much better. It was under these circumstances that LaBine and his officers received an unusual feeler. It came from an alternative star in the newly resident New York radium galaxy. Boris Pregel, they learned, had come to America. We have already encountered Pregel as Union Miniere's chief sales agent in Europe. Russian by birth, he had arrived in France via Romania after sensibly decamping at the end of the Russian Revolution. British Intelligence later reported that Pregel had carried on his marketing activities through a series of companies in Europe that he controlled, though he does not seem to have controlled the Radium Chemical Company, the American marketing organization of the Union Miniere. Presumably by 1939 or 1940 Pregel's relations with the Union Miniere were unsatisfactory; at any rate when he joined

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his Belgian employers in New York they were no longer requiring his services. Pregel was, therefore, somewhat at loose ends, and he had what American Intelligence or the FBI — the exact source is unclear — believed to be 'a considerable personal fortune' at his disposal. He had, as well, his indubitable talents as a salesman and promoter and an incomparable series of acquaintances in the field of nuclear physics, including Leo Szilard. No one can now say who made the first approach, or how, but it is indisputable that in November 1940 'the Eldorado and Pregel forces joined hands,' as the Financial Post later put it. A subsequent analysis by a prominent Toronto accountant outlined the contract that was signed. 'Pregel was appointed exclusive sales agent for Eldorado throughout the world,' J. Grant Glassco wrote in 1947. 'As was to be expected, Pregel would use his "best efforts" to sell Eldorado's products, for which he would receive a commission.' As Glassco pointed out, Pregel 'was also entitled to deal in radium on his own account. Thus it became immediately possible for Pregel to handle the most favourable sales he was able to make by dealing himself as a principal and to reserve for his agency operations those transactions where the selling terms were less advantageous.'3 It was, by any standards, an unusual contract, but it passed muster with the Eldorado board on 8 November, and it may have reflected their realistic appraisal of their company's place in the scheme of things. Three weeks later, Pregel established the Canadian Radium and Uranium Corporation (CRUC), with offices in New York's Rockefeller Center, to carry on business. 'This deal,' the Financial Post reported in 1945, 'between Eldorado and Pregel resulted in immediate substantial advances to the company against future deliveries. Soon radium stocks which had been out on lease began to "unfreeze."' Net profits rose, and rose substantially, in 1941 as compared to 1940: $167,000 against $50,000. If Boris Pregel profited substantially from this arrangement, so apparently did Eldorado.4 By the time Pregel came aboard, Eldorado had had some slight contact with the atomic experiments being conducted in the United States. Marcel Pochon had told the press in May 1940 that energy

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through the fission of uranium atoms was a problem 'of particular importance,' although he did not elaborate on where the importance lay. In May 1941, Pregel sold Lyman Briggs six or eight tons of uranium oxide at $2.06 a pound, although Briggs had initially expressed a preference for the cheaper option of renting. Because of the scarcity of Eldorado's papers for the period, it is impossible to know what the company or its president made of this, but it is reasonable to suppose that they knew that it had to do with the military applications of uranium, and that it was being conducted for the purpose of American national defence.5 Pregel was already on record, on 9 December, as telling the u.s. Office of Production Management that 'this may be an opportune time to reopen the matter of acquisition of an important quantity of radium and uranium by the United States Government for the stock of essential materials.' The Canadians, Pregel thought, might be persuaded to lift their export controls over these substances in exchange for u.s. dollars to feed other and more essential parts of their war effort. In the confusion that attended the organization of the American economy for war, Pregel's offer was either side-tracked or mislaid. Or, just possibly, it was put to one side because of security preoccupations. Pregel received a small order for five tons of uranium oxide on Christmas Eve, but the large order that he sought eluded him. Instead, LaBine was told to stand by for personal negotiations, bypassing his agent in New York. On 26 December 1941, Gilbert LaBine received a telegram from Lyman Briggs. 'Doctor E.V. Murphree will visit you December 29th,' LaBine read. 'You are authorized to discuss with him any of your work pertaining to national defense.'6 There is nothing particularly surprising about this missive. American entry into the war was followed by the acceleration of work on uranium. But it should be noted that two authorities were not informed of Murphree's visit: the Canadian government and Boris Pregel. In the case of the Canadian government, they were not to know for some time. In Pregel's case, it took him almost two months to discover what was going on, an indication that his friends and connections were not universal inside the American uranium project. When he did find out, he sent LaBine a stern rebuke, reminding the Eldorado

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president that Pregel and Pregel alone was the 'exclusive sales representative of your company.' LaBine abjectly apologized; and his apology seemed to be justified when, early in March 1942, Pregel produced an order for 60 tons of uranium oxide, approved by 'Dr. Vannaverbush' [Vannevar Bush], the head of the u.s. atomic project.7 Keeping Eldorado under control had an additional significance for Pregel. During 1941 and 1942, the refugee radium salesman had interested himself in the progress of u.s. atomic work. In January 1941 he gave an interview in which he described 'the unbelievable stores of energy' that could be released from the uranium atom. The Axis powers knew of this energy, and were working night and day to get to it first. Fortunately, Pregel explained, the allies would get there first. Much later, Arthur Compton, one of the early leaders in the u.s. atomic project, sought recognition for Pregel's 'foresight and willing cooperation as a help to the nation in its start on our program,' not to mention 'his very real help through his laboratory services in supplying radium and radium-beryllium capsules.'8 The reference to laboratory services is significant. It is reasonable to suppose that the laboratory referred to was Eldorado's, something that Pregel's own correspondence would seem to confirm. In May 1942, Pregel wrote to the American Office of Scientific Research and Development (OSRD) to offer the services 'of a group of prominent scientists, which was originally headed by Professor Jean Perrin, Nobel Prize Laureate.' Regrettably, Perrin had just died, but his son Francis was available to take his place. Pregel also offered for American service 'the scientific staff at our laboratory in Port Hope,' a description that might have puzzled Gilbert LaBine.9 This offer was refused, largely on the grounds that so many foreigners would pose a security risk, but it is interesting to contemplate the injection of a private scientific force in the employ of a White Russian-Romanian-French entrepreneur into the creation of the atomic bomb. Pregel's offer was entirely in the international tradition of the Union Miniere—Joliot—Curie collaboration proposed before the war, but unlike the French arrangement it totally failed to get off the ground. LaBine was presumably too happy to care what Pregel said or

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Eldorado

did. The 6o-ton order from the Americans was enough to reopen the mine. His board was told the happy news on 24 March, and 'resolved that the mine should be re-opened and that plans should be started immediately.' In other, older, days, the news would have been trumpeted from the rooftops. In March 1942 it was a secret.10 II

So far, Eldorado's affairs had remained private.True, it was dealing with a government, but the government was that of the United States and had no legal power to compel Eldorado to do anything. To reopen the mine, however, it would be necessary to ask permission from another government, that of Canada. The Canadian government in Ottawa controlled aviation, and therefore the company's ability to fly men into Great Bear Lake before the ice thawed. It controlled aviation fuel, and therefore the ability not only to fly, but to supply the isolated camp. It was, furthermore, regulating manpower and labour supply. It controlled, often to a minute degree, the whole economic life of the country. The Government of Canada, though inflated beyond recognition by the demands of war, in 1942 was still only a very small number of men and women, politicians and civil servants, if by 'government' one meant people who could make decisions and find the money to sustain them. The political side of the government was Liberal, and had been since the defeat of the Conservatives in 1935. The prime minister, William Lyon Mackenzie King, had entered politics in 1908, and had first become prime minister in 1921. King's cautious political style imprinted itself on his party and on the government as a whole, but its effects were enhanced by his inclination to leave details to his ministers, thereby reserving his own attention and strength for broader questions. Among these broader questions was the amount of aid Canada could prudently lend the allied cause. How much could Canada produce, and how much could Canada afford to produce? It was understood almost from the beginning that Canada would send generous aid to Britain and through a succession of credits, loans, and outright gifts the dominion contributed heavily to the British cause. Such aid had a price, however. Its size perturbed some

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politicians, and its direction - to Britain - created unease among French-Canadian Liberals and public opinion generally. While not precisely anglophobic, many Canadians were resentful of British demands in the past, and suspicious of what the wily British might be cooking up for the future.Thus co-operation with the British ally had to be carefully weighed, particularly when the expenditure of money might be necessary. One of Mackenzie King's best political attributes was his ability to select, and to work with, outstanding cabinets. With King holding the political ring, his ministers were afforded ample scope for their own departmental duties. Of his ministers, three particularly play a part in the Eldorado story. J.L. Ilsley, who entered the cabinet in 1935, was minister of Finance. Ilsley headed a department of exceptional competence; his officials kept an anxious eye on revenues and expenditures and the balance of payments between Canada and the United States. If money was to be spent, at any rate in large sums, it had to pass by Ilsley. Louis St-Laurent, the minister of Justice, was a newcomer to the cabinet. In 1942 he was feeling his way towards becoming the senior minister from Quebec, a position which would give him considerable political influence and assure his inclusion in the most important decisions that King and his colleagues had to make. It was fortunate for King, and for Canada, that St-Laurent, as a corporate lawyer, had broad business experience and, more unusually, that he had the ability to make up his mind quickly and decisively. Ilsley and St-Laurent were members with King of the War Committee of the cabinet, a secretive inner group to whom the most confidential and urgent decisions on the war were usually referred. There were other members — the ministers responsible for the armed services, and the minister responsible for war production, Clarence Decatur Howe, universally known among his friends as 'C.D.' His enemies had other things to say about him. Howe was 57 years old in 1942. Born in New England and trained as an engineer, he had been successively a university professor, a Canadian civil servant, and the head of his own engineering firm, the C.D. Howe Company. Howe had lived and worked in every part of Canada, including even Toronto, a city he detested. Howe's connections there were not strong, but somehow he had met

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Gilbert LaBine and had formed an admiration for this self-made man with the impressive and self-confident manner. LaBine, he may have thought, was a man much like himself, someone with determination and drive, and a refusal to be discouraged by small things. In 1940 Howe was made minister of Munitions and Supply, with powers — in theory — to oversee, direct and, if necessary, commandeer Canada's industrial output. By 1942 his department operated an elaborate system of controls over the economy. Handling the levers were businessmen recruited from the private sector for the duration of the war, many of them expert in their fields of jurisdiction. In running his part of the war effort, Howe relied on the same principle of devolution of authority that his leader, King, employed. Each division, whether it went by the name of directorate, control, or crown company, was expected to handle its own affairs, reporting to the minister only when difficulties were truly insuperable, or when political fallout was to be expected. Three of Howe's associates deserve mention here. In his outer office sat WJ. (Bill) Bennett, his executive assistant.Though still a young man - thirty in 1942 - Bennett had worked for Howe since the minister had first entered the cabinet, in 1935. Part of Bennett's job was to screen the people and problems that prowled in front of the ministerial door, and to keep an eye out for any sources of trouble. In the process, he relieved the minister of a great deal of routine business, and got to know Howe's visitors and clients fairly well. About a mile away from Howe's office was the National Research Council, which had assisted in some of Eldorado's problems during the 19305. Its president, C.J. (Jack) Mackenzie, was Canada's senior scientist. An engineer by training, he had also been one of Howe's first students, at Halifax's Dalhousie University, and the two men had kept up a close and affectionate association ever since.Their mutual confidence was an important factor in any dealings that affected Canada's scientific policy. Finally, there was the metals controller, George Bateman, the former secretary-treasurer of the Ontario Mining Association. Bateman's task was to stimulate mining production despite a declining labour force. His periodic reports to Howe, therefore, had a gloomy note as he emphasized the crisis that Canadian

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mining faced in getting nickel, coal, or lead and zinc out of the ground. To assist in production and supply, Howe resorted to the device of establishing a group of government-owned companies, the crown corporations. These had the advantage of autonomy, which permitted initiative, and decentralization, helping to alleviate the problem of facilities concentrated in a very few. areas of the country. Crown companies need not result in a vast increase in bureaucracy, and although they were held strictly to account for what they did with the people's money, they were not subjected to the same constricting rules that bound the civil service. Where possible, Howe equipped his companies with competent directors; since they were all newly created there was no burdensome carry-over. Among these directors was numbered Gilbert LaBine, who became a director of the government's artificial rubber plant, Polymer Limited, early in 1942. It was not, therefore, difficult for Gilbert LaBine to persuade Bill Bennett that he had to see the minister on a matter both serious and urgent. Whether or not Howe had advance warning of the purpose of LaBine's visit is not known, but it does not seem to have taken LaBine long to persuade the minister that his contract with the Americans had the highest priority. Wilfrid Eggleston, in his 1965 book Canada's Nuclear Story, presents what seems close to the official version of their meeting: Mr. Howe was not disposed to interfere with Eldorado's chances of supplying the U.S. government with uranium oxide and ore, and he wanted to know how soon the Eldorado mine could be restored to active production. The Canadian government, Mr. Howe said, was prepared to assist Eldorado by granting priorities for obtaining the necessary machinery and supplies. The president of Eldorado responded that with the assurance of such help the prospects of an early reopening were good. The whole transaction, on the insistance of both the u.s. and Canadian governments, was to be conducted with the greatest secrecy ...

So much for the immediate business. LaBine got his priorities, and could set to work putting together a team of miners, assembling equipment, and finding transport into Great Bear Lake. There

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was, however, one other consideration, which may have remained unspoken. 'The question of the wisdom of leaving such a strategic war material in exclusively private hands occurred at once to Mr. Howe,' Eggleston wrote, 'but no immediate steps were taken to expropriate or control the LaBine uranium properties.'11* Ill

As in 1930, the way into Great Bear Lake was by air. LaBine contacted Canadian Pacific Airlines (CP), brandished his priorities, and secured their agreement to fly in 25 men and their necessary supplies immediately. Leading the party was Ed Bolger, briefly mine superintendent in 1939—40, the man most familiar with how the mine was shut down. Ed Bolger had once belonged to the firm of Footer & Reid, Eraser Reid's company. With Reid still on the Eldorado board and Bolger available for employment, it was natural to send him back to the north. Other connections were stretched to see what they would turn up. For Dick Murphy, a geologist and another Footer & Reid alumnus, the call came one day in the lobby of Toronto's Royal York Hotel where he was passing the time en route to an army assignment. It was the last place one would expect to get a call for 'Mr Murphy' and like a sensible man, Murphy ignored it. Curiosity eventually overcame him, however, and at the end of a few minutes the surprised lieutenant found himself talking to the adjutant-general in Ottawa. He told Murphy that he had a 'request' - not an order - for Murphy's services. All Murphy had to do, he learned, was to walk a couple of blocks along King Street, to the Toronto Star Building, and there call upon Mr Gilbert LaBine. Gilbert LaBine, it turned out, had the power to shake lieutenants out of the army, provided they were willing. Murphy, whose war effort consisted of carrying messages marked 'by hand of officer,' * Other versions of the story place the meeting between LaBine and Howe in mid-April, and place the initiative for the meeting with Howe. This seems less likely than the Eggleston version. Unfortunately, no source can be assigned for the account used here, but it seems altogether possible that Eggleston had access to sources, whether printed or oral, which I have been unable to locate.

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was delighted to leave His Majesty's uniformed service to embark on another, and more useful, way of fighting Hitler. It was all part of the same fight, LaBine told him: they were working on a uranium bomb.12 Murphy wasn't the only recruit to LaBine's cause to experience what Eldorado's president could do, now that he had the government behind him. A young agent working for Northern Transportation in Edmonton, Bruce Hunter, had spent the previous few weeks clearing his desk and preparing to enter the army. But when the day came, the call was cancelled. Instead, there was a message from Frank Broderick, Northern's general manager, telling him to report back to work. Down in Washington, the OSRD was attending to LaBine's next priority. If Great Bear Lake was really to get going, the Americans were told, the next contingent of 150 men would have to go in almost immediately. To supply them with equipment, and to keep them in fresh food, would require regular flights in and out. In winter, that meant planes with skis; in summer, with pontoons. If time was of the essence, CP Air could not forever be attaching and detaching wheels just in order to accommodate Eldorado. Estimates of traffic in and out of Great Bear indicated not one plane, but two, because no single plane could be kept in service around the clock, day after day. Could the Americans expedite the scheduled delivery of two Lockheed Lodestar aircraft by nine months, changing the delivery date from February 1943 to May 1942?^ By July, by air and by water, LaBine's supplies were getting through. Fortunately there was a reserve of ore available for instant shipment, having been abandoned on the docks in June 1940. But it would take longer than expected to get the mine back into production. When Bolger had closed it in 1940, he assumed that the mine would freeze for two levels down, about 250 feet. In fact, it had frozen for only 15 feet. A pipe filled with oil had been left in as a plug at the top of the shaft; it had frozen, and burst, leaving an oily sludge all over the shaft. 'Quite a mess,' Murphy recalled. Water in the shaft had rotted the timbers. The backs (roofs) of the drifts were loose, making a stroll through the mine an extremely risky venture. One raise was full of helium; another had no oxygen. The pumps were working full time, since the generators had survived the cold, but there was a problem with the steam

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plant, which used locally cut timber for fuel. The trees in the immediate vicinity of the mine 'looked like carrots,' according to Murphy. As for re-timbering, it was almost a lost cause, for even larger trees in the subarctic were gnarled, twisted, and full of knots. There were a few compensations. Walli was gone, and with him his rule against women. Staff could bring in their wives, and had the option of dining at home, using supplies bought at cost from the commissary, or eating in the 'Blue Room,' the staff dining area. The winter of 1942-3 was not, one staff member recalled, a time of hardship. The evacuees of 1940 had left almost everything behind them, including tinned food which had survived very well the intervening two years. At a time when luxuries like shrimp were only a memory in rationed southern Canada, the staff were eating them by the can. Accommodation was a little more difficult, especially for married couples. There had been no married quarters, apart from the manager's house; now the carpenters got to work building tworoom apartments (living-room and kitchen combined, with bedroom and bath). The bunkhouses were much as they had been, and as before the staff lived with the miners, until, towards the end of the war, Bolger had a staff house built. As had happened during the thirties, miners were recruited from northern Ontario and Manitoba, where the LaBines had their Gunnar mine properties; and as in the thirties, a certain number of the miners were the hard-working Finns. Among these were the 'Red' Finns, who had a long tradition of support for the Communist party and continued to receive leftist magazines, as their predecessors had done a decade earlier. It is one of the more amusing ironies of the war that the Russians seem to have been unaware that this small, isolated group of left-leaning proletarians were sitting in the middle of one of the allies' most closely guarded secrets. But if the Russians did not know, presumably neither did the RCMP, which was responsible for security at the mine.14 The mine was geared to maximum production. The Americans wanted as much uranium as possible, as fast as possible. As noted previously, the average grade available for milling was about 1%. However, at times, on Number One vein, the grade reached 5%, the highest ever, a result that warmed Bolger's heart. Since

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quantity and speed were what head office needed, Bolger set out to give Eldorado what it desired. The result was not strictly in accord with the best mining practice, if by that we mean the systematic, routine exploitation of an ore deposit. Instead, Bolger sought out the richest ore deposits and worked those first. Average grades mined during the war were higher than they would have been if normal mining methods had been used.The target Bolger set was to produce every month a tonnage of concentrate that would contain 100,000 pounds of U3O8. Murphy later concluded that 60,000 pounds would have been a more realistic aim, and that, in fact, was what they got.15 Compared to the 19308, the labour force was up. In 1943, 150 men were employed. By early 1944, that number had increased to 230 because it was found necessary to expand the mill and undertake considerable mine development. Such numbers did not come easily, or voluntarily. After failing to get enough men through the ordinary means of recruitment, LaBine once again appealed to Howe. Howe in turn went to Canada's national Selective Service system. 'Since these steps were taken,' an American observer drily recorded in 1944, 'no difficulty has been found in obtaining an adequate labor supply.' This happy state was by no means universal in the mining industry at that time: 1943 saw Canadian mining production turning down, and even a highpriority corporation such as Inco in Sudbury found itself confessing that it could not prevent a decline in output at a time when its nickel was in greater demand than ever before. Eldorado, then, was doing better than most.16 Those who got to Great Bear were better treated than their predecessors had been. In some part this may be due to Bolger's different approach to mine management, but the fundamental cause was obviously the same labour shortage that forced the company to dip into the government's compulsory labour system. In 1943 a recreation hall sprang up, complete with library, pool tables, store, and movie facilities. In 1944 a bowling alley was added. But if conditions above ground were better, those below ground were in many respects worse. The basic cause was the tendency of Great Bear Lake to flood the mine. Frozen chunks of ore, which in 1940 had been abandoned,

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broken, were found when the mine was reopened. The temperature of the rock was i9°F. To move it, it must be thawed. To thaw it, electric heaters were brought in and ventilation reduced. Reducing ventilation was a problem because, unknown to the mine management, it encouraged the development of pockets of radon gas. While it should be underlined that the state of knowledge of the day permitted such a technique, the longer-term consequences of exposing the miners to radioactivity were bound to be unfortunate. 'It was a mean place to work in those days,' Dick Murphy sighed. But given the rush to get back into production, before the effects of the flooding and freezing could be dealt with, there was little that could be done about it/ 7 Despite all the rush, and the selection of only the best stopes for mining, production at the mine tended to fall. Its best month, August 1943, yielded only 80,000 pounds of U3O8 embodied in concentrates. By December, the worst month, yield was down to 18,454 pounds. Some of this decline was caused by the decision to try to improve production through deepening the mine and sinking the shaft another 500 feet. The Americans were not pleased by this development, which Eldorado's management did its best to conceal. 'It will be noted,' a u.s. Army geologist reported in early 1944, 'that the mine is behind in production some 27 tons of U3O8 as of April 1944 and that it has continued to fall behind continuously since i December [1943]. Unless this rate of production is considerably increased during the next few months over the rate since i December 1943, it seems unlikely that the contract commitments can be met.'18 Responsibility for this situation cannot be laid entirely at Eldorado's door. Nevertheless, some of the blame definitely attaches to the company. In the first place, the pace of demand was more than the company seems to have anticipated, and more than it could satisfy. But while granting that the demand was American, the decision on how to supply — at what rate, and at what cost — was Canadian. It was, ultimately, Gilbert LaBine's, with whatever assistance he could cull from his board of directors and staff. It may be that the two years' hiatus in the mine's life was damaging in a sense different from the problems of freezing and flooding and rot. Moreover, LaBine had never operated a mine in a time of full

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employment and restricted supply. Securing a supply of labour, in particular, must have been an unfamiliar constraint on Eldorado's operations. Yet LaBine, in running the mine from 1942 to 1944 or 1945, behaved as he always had. There is more than a whiff of the shoe-string operations of the previous decade. There is a feeling that having been surprised by good fortune, LaBine was unsure what to do with it. Revelling in his new authority, LaBine nevertheless did not come to terms with the financial possibilities of his situation, and instead tried to shoehorn his operations into the outmoded mould of the 19308. The hasty expansion of operations in 1943 and the deepening of the mine in 1943-4 in the face of declining production do not argue a well-planned mining strategy. The world was beginning to overtake Gilbert LaBine. IV

It might seem that the disappointing returns from the Eldorado mine would prove embarrassing to the company and distressing to its client, the United States government. So, up to a point, they were. But the United States did not depend entirely or even mainly on the output of the mine. Neither, as we shall see, did Eldorado's refinery at Port Hope. It will be recalled that there were two major sources of uranium available to the would-be bomb-makers on the allied side - the Belgian Congo and Great Bear Lake. Both Great Bear Lake and the Union Miniere pit at Shinkolobwe were shut down in 1940, and the Shinkolobwe mine in fact remained closed until 1944. In 1939 rich concentrates from Shinkolobwe were introduced into the United States, and there they sat, unwanted and largely forgotten, in a warehouse on Staten Island in New York harbour. Like Eldorado, the Union Miniere also seems to have had uranium concentrates in transit inside the Congo, or piled up around the mine; the total of concentrates at its disposal, accordingly, was the 1200 tons from Staten Island, plus about 900 tons in the pipeline between Katanga and the Atlantic Ocean. There was an apparent lapse in the Union Miniere's attention to these deposits between 1940 and the summer of 1942. While Boris Pregel was prowling Washington corridors in search of contracts

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for Eldorado and, incidentally, for himself, the Union Miniere directors in the United States remained inert. And so it was Boris Pregel (who knew what Union Miniere had done in 1939 and 1940) who first had the idea of mining the little mother lode sitting so incongruously a mile offshore. Pregel's potential clients were metamorphosing before his eyes. Until the spring of 1942 the search for an atomic bomb was primarily civilian. Jurisdiction lay with a civilian agency, the OSRD, and with men who were primarily scientists themselves: Briggs, Conant, and Bush. By the spring of 1942, it was becoming clear that the cost of atomic power would be truly formidable, and that an effective establishment for the project would be extremely large and complicated. Administratively the atomic project was outgrowing its origins. In June 1942 the American bomb project was transferred to the u.s. Army Corps of Engineers; in September that body placed Brigadier Leslie Groves in charge. Bush and Conant remained in the picture as advisers to President Roosevelt and Secretary of War Henry Stimson; Vice-President Henry Wallace was also titularly involved, but exercised little influence on the course of events. After June 1942, Eldorado's contracts would be with the Corps of Engineers, and more particularly with the Manhattan Engineering District, which dealt exclusively with atomic matters. Atomic orders and projects were distributed across the United States. One of the highest and most immediate priorities was to construct an atomic pile and see whether a chain reaction could be sustained. This took place under the direction of Arthur Compton at the Metallurgical Laboratory of the University of Chicago. But before a chain reacton could be in prospect, pure uranium would have to be produced. Eldorado's own metal was, usually, about 4-5% impure. Work at the Mallinckrodt Chemical Company in St Louis, Missouri, partially solved the problem. Using an ether extraction process, Mallinckrodt improved the purity of uranium oxide 'to a degree of purity seldom achieved even on a laboratory scale,' as the Manhattan Project later reported.19 The cost of purification fell as well: previous attempts had cost $1009 per pound, but the Mallinckrodt process brought the cost down to $22.

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This breakthrough also eliminated a bottleneck that might have proved fatal to any hope of constructing a bomb for use in World War ii. Uranium oxide from Eldorado ('grossly impure commercial oxide,' according to the official 1945 Smyth Report on the making of the atomic bomb) could now be shipped to St Louis, purified, and then sent on for conversion into uranium metal, at which point it was ready for inclusion in the atomic piles being developed in Chicago's Metallurgical Laboratory. Starting in May 1942, therefore, Eldorado shipped 15 tons a month. The company assisted the Americans by reducing the impurities in its oxide to what the latter considered a more reasonable level - i % or less. To do that, it merely had to clean up piles of oxide in the refinery yard, start emptying its silos, and begin forwarding concentrates piled up at Waterways, Alberta, and, once the Great Bear Lake mine reopened, the concentrates there as well. It would only be in 1943 that the misadventures in mining in the Arctic would begin to have an impact on Eldorado's ability to deliver on its contracts. The first Go-ton contract was swiftly succeeded by another. The rhythm of contracts was established partly by need, but also by the American government's fiscal year, which starts on i July. The Americans waited impatiently, meanwhile informing the British that they soon intended to make a substantial purchase. The British placed a small, experimental order of their own through the Canadian National Research Council; its amount, two tons, was barely enough to attract Eldorado's interest, and there is no record that the company had any difficulty meeting it. Sure enough, on 16 July, Boris Pregel informed the company that he had just negotiated a contract for 350 tons of 'uranium black oxide, commercial grade,' priced at $2.05 per pound, 'less 5% and the usual trade discount.' Commercial grade, of course, was the impure kind that the Americans complained about, and the contract also stipulated that for more purity, the price would rise to $2.85 per pound. The importance of this order is threefold, and it deserves to be stressed. First, a 35o-ton order appeared to guarantee the company's indefinite continuity and prosperity. Second, because Eldorado was capable of producing only 150—200

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tons of oxide a year, it monopolized the company's production until sometime in 1944. Third, and most importantly, no other buyer - meaning the British - could poach on American turf. 20 The 350-ton order was not all, however. On 22 December 1942, the Canadian Radium and Uranium Corporation - Pregel placed another order for 'five hundred tons of U3O8,' either commercial grade or purified. 'This order,' Pregel stipulated, 'is to follow immediately the completion of our present order [for 350 tons] and should be delivered before December 3ist, 1944.' The price was set at $ i .00 per pound, plus refining charges; the 'regular trade discount of 5%' also applied. Eldorado agreed, on the same day, to do what Pregel asked. Eldorado was now committed to supply 850 tons, in total, to the U.S. Army Corps of Engineers, in addition to the 60 tons first contracted for, and supplied, in the spring of ig42. 21 That was still not all. During the first eight months of 1942, the Americans concentrated on acquiring enough uranium to feed their most urgent project, the experimental atomic piles at the University of Chicago. At the same time they began to study whether there would be enough uranium available to take them further, that is, beyond the limited supplies that Eldorado could make immediately available. The answer to this dilemma came by a curious and roundabout route, and inevitably it involved Boris Pregel. Pregel, in the summer of 1942, was attempting to buy the Union Miniere's Staten Island uranium stock from Edgar Sengier. To refine it, he would have to get an export licence, and an export licence had to be approved by the u.s. State Department. When an application for such a licence came before the responsible officials at the State Department in August 1942, it occurred to someone that the army might have an interest in what was happening. The army did. Within days Sengier found himself confronting the officers of the Manhattan Engineering District, who wanted to know what he had to sell. He had 1200 tons immediately on hand, Sengier replied. Did the officers have authority to buy? More than enough, they answered. And in this manner the world's largest and richest source of uranium passed into the hands of the u.s. Army. 22

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What the army now had was concentrates, rich concentrates to be sure, which still had to be refined. There was only one place where that could be speedily done, and that was Port Hope. This should have posed no great problem. Boris Pregel and his company, CRUC, were responsible only for sales of Eldorado uranium and it would seem that an arrangement for refining could speedily have been made with the company. But nothing was ever simple when Boris Pregel was nearby. His CRUC promptly appeared as a 'co-adventurer' with Eldorado in refining the Belgian ore; as Canadian government accountants concluded in 1946, Eldorado did 90% of the refining for what was later estimated to be one-sixth of the refining fee. Radium requirements were treated in separate contracts.23 What did this mean to Eldorado's ability to perform its existing contracts? The capacity of the refinery in 1942—3 was between 120 and 145 tons of feed per month. The Katangese ores were different from those produced at Eldorado's Great Bear Lake mine. If the Belgian ore had priority, then Eldorado's own ore would have to wait until the Belgian order was finished, since the two required quite different methods of treatment. Consequently, it was agreed that even the first, 35o-ton contract, which was still pending, would be 'put into abeyance' until the Belgian work was done.24 In this manner Eldorado's refining capacity was preempted for what would prove to be years: five, to be precise, because final processing of the wartime contracts would not take place until the end of 1946 or the beginning of 1947. Thus, Eldorado's principal importance in the wartime atomic energy project was established. In the earliest stages of the Manhattan Project, down to December 1942, Eldorado ores and (ultimately) oxide played a key role. The atomic pile in Chicago was fed with Great Bear Lake products, partly because LaBine had initial stocks available, and partly because the u.s. authorities had no idea that there was any other ready source. This implied a certain kind of production from Port Hope, and a commitment from the company to exert itself to produce a purer grade of oxide than normal. In the fall of 1942, however, things changed. It was not the slow-moving Eldorado mine that would determine the pace of the Manhattan Project, but the rich African concentrates from

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Union Miniere. Now it was the Eldorado refinery that became crucial to the bomb project.25 V

The immediate effect of Eldorado's new-found abundance was the ballooning of employment at the refinery. From the 50 men employed in 1940—1 the employment roster soared to 252 permanent employees, and 25 carpenters and other craftsmen working on necessary repairs and additions (October 1942). Pochon found that he could no longer get along by himself, and in short order some new appointments were made. A.H. Ross, a chemical engineer who had worked briefly at the Great Bear Lake mill before the war, was hired away from war work in Valleyfield. R.H. (Pete) Farmer, another chemical engineer, was hired from a mine in northern Quebec to take charge of the uranium circuit, and finally, in 1943, another Valleyfield engineer, Jack Burger, was hired to run the radium circuit.26 Because of the fluctuations in employment since the beginning of 1940, the work-force was not what Eldorado had once been used to. Whereas in the 19305 the work-force was both stable and long-serving, this was no longer true after 1942. Perhaps 10% of the workers, in Farmer's estimate, were long-service. The rest were a decidedly mixed lot: some high-school students, 'rubbies' cleared out of jails, rejects from the army, and, above all, a lot of women. The workers now worked more slowly than their predecessors had, and made more mistakes — a drag on urgent production. Some of the tasks performed were heavy and clumsy, and hard on women's slighter frames. 'We had anywhere from three to six women a shift wheeling open wheelbarrows of soda ash around the plant.'27 Perhaps the greatest change over the record of the thirties was in overall labour relations. It was no surprise that Eldorado was getting a relatively undesirable work-force, one anonymous analyst reported around 1943. 'Enquiry has revealed that our starting wage is less than that paid by Port Hope Sanitary Co.; our working week is [longer] than that of either the Port Hope Sanitary Co., or the Nicholson File Co., both of whom pay at the rate of if times for work over and above 48 hours per week.' Not surprisingly, this

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meant that Eldorado was in 'a very unfavorable position regarding labor. Not only do we fail to attract the desirable type of efficient workman, but our present employees do not possess the feeling of loyalty, good-will and enthusiasm that would be present if their earnings were comparable with those paid by other local industries.' This for work that was by any standard physically demanding, hot, dusty, and tedious. It is not surprising, therefore, that in 1943 a union came to Eldorado. It is also true that a union came to the Port Hope Sanitary Company as well, and presumably it arrived because conditions at the two companies were approximately the same. The agent in both cases was Brother Ernest Evans, general organizer of the congress, meaning in this case the Canadian Congress of Labour, which was affiliated to the Congress of Industrial Organizations, or cio, in the United States. Terms at the two plants were roughly the same: union recognition, seniority rights, time and a half for overtime, a grievance committee, holidays with pay. In Eldorado's case a 48-hour work week was made standard, ending the practice of six g-hour shifts that had obtained for some employees.28 The fact of the union's appearance at Eldorado need not be conclusive proof that conditions at the plant had deteriorated; it may, at most, show that employees in Port Hope were susceptible to arguments for job security, seniority, and comparability of working conditions. Many other Canadians, in the first years of the war, were making the same decision, and the fact that the Port Hope refinery workers joined a union makes them not less typical, but more. It is possible that the middle management at the refinery was less known in the Port Hope community, and that some among the managers were disposed to take a hard line towards working conditions. There was 'every bit good reason for a union,' in Pete Farmer's view. In any plant, he said, 'You don't wag a finger and say, here, you son-of-a-bitch, do this and that.' Pochon, 'a smart and grand old fellow,' nevertheless was getting on and, in the early 19408, aloof. Always polite, Pochon seemed less engaged than he once had been. Pochon's responsibilities were many and they were not all confined to Port Hope. It was not only on the shop floor that things had changed.

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Security had arrived at Port Hope, in the form of the American FBI and the Canadian RCMP. But while sources agree on the fact of security, they supply few details of what security consisted of. It was, in all probability, a low-level operation that checked into people's backgrounds by a rifle through existing police files. If nothing existed there, then a clean bill of health could be issued. In the murky realm of security, however, nothing is ever very clear; naturally the most difficult matter of all to discern is whether security was effective, as opposed to whether it existed. The appearance and existence of security personnel and procedures must have imposed a constraint as well as a strain, while doing little to advance efficiency or production. The latter was the job of the u.s. Army Corps of Engineers, frequent visitors to Eldorado and Port Hope during and after the war. Major Phil Merritt (in peacetime Dr Phillip Merritt, geologist) was the principal intervener in what had hitherto been Eldorado's business. The fluctuation in Eldorado's production during the war created some unique problems for Merritt and his staff. They wanted a varying level of purity in the final product. It could be, and sometimes was, 99% pure, what the contracts termed 'D— i.' But that required dunking uranium oxide in repeated ammonia baths, and ammonia baths were both expensive and time consuming. It was more reasonable to require a simple 97% purity and leave it to the Mallinckrodt process in St Louis to bring the oxide up to standard. 'Purity' hardly began to describe what had to be done. The worst recurring problem that the Corps of Engineers and the refinery staff faced was that of the rare earth content of oxides. This was particularly the case with lower-grade ore feeds from the Congo, later shipments from Union Miniere. Gadolinium, a rare earth, might account for, to take an example, 0.8% of a concentrate fed into the refinery. If the concentrate had 80% U3O8 content, as some Belgian shipments did, then 0.8% was not particularly significant in the final product. But if the feed were 50% or 60%, then it represented a much higher proportion of the final product. The reason that this caused the Corps of Engineers sleepless nights was that gadolinium absorbed neutrons: too much, and it would

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interfere with chain reactions. The Corps of Engineers' indignant perceptions of neutron absorption clashed with the Eldorado staff's disgusted response: had the u.s. Army noticed that the feed it was sending to Port Hope was widely different in uranium content? Not only engineers and chemists were placed at a disadvantage by this situation. If each batch was new, if Great Bear ore differed from Congo ore, and if early Congo ore differed from later Congo ore, then the process required by each batch would have a considerable impact on costs. It was with this in mind that the refinery staff in 1944 reminded their head office in Toronto that some closer consultation would be advisable before head office gave its consent to cost estimates that would later prove to have little resemblance to reality. Naturally, Farmer said, a company like Eldorado would try to insure against chance and loss by estimating recovery to be lower than it actually was; and naturally there was a temptation to report recoveries lower than they actually were, in the same spirit.29 These issues of production seldom surfaced at the high levels where grand policies were determined. Their importance is nevertheless obvious. The slow recovery of Eldorado's mine could have caused a major disruption in the atomic bomb program. Instead, it encouraged the Americans to substitute Congolese ore for Canadian. Congolese ore still had to pass through Port Hope, but in doing so it caused significant difficulties in the continuity of production at the refinery. The variation in concentrate feed seems to have confused Eldorado's head office, and resulted in contracts that were not always wisely negotiated, or soundly based. What may, in retrospect, be most surprising about Eldorado's wartime production record, is how little actually went wrong. Using what was basically Pochon's pre-war establishment, with emergency additions in 1942-3, Eldorado managed to process 2000 tons of uranium oxide between 1942 and 1946. It had assistance, naturally. Pochon's professional assistants were hardworking men of considerable capacity. The permanent staff at the refinery, those who had survived the 1940 cut-backs, also gave good service and demonstrated surpassing ingenuity. The govern-

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ments of Canada and the United States jointly made supplies available, to the extent the refinery requested them. Accidents and acts of God apart, what Eldorado wanted, it got. Eldorado's performance between 1942 and 1946 was probably no worse than that of most companies with wartime contracts. Given the complexity of the company's task, it may well have done considerably better at solving its engineering and chemical problems and at satisfying a customer much more demanding than the average — indeed, more demanding than any customer had ever been. With this record, and in this context, what happened to the structure of the company in the course of the war may seem surprising. The crux of the matter was that Eldorado managed to satisfy only one customer - the u.s. Army. Unfortunately for the company, in the short term, it had two customers. Politics once again would play a considerable part in shaping Eldorado's future, and the key politician would be C.D. Howe.

4 Private into Public

Between 1942 and 1947 Eldorado was the concern of not one government, but three. The first was the Government of Canada, which had to make men, equipment, and 'facilities' - that enormous sea of goodwill on which so many projects are floated and without which they could not be launched — available to a small mining and refining company that still bore the word 'Gold' in its title. The second was the Government of the United States, which reached over the border in December 1941 to offer to buy enough uranium from Eldorado to permit the reopening of the Great Bear Lake mine and the refining of Canadian and Belgian ores. Neither of these governments gave much thought to changing Eldorado's operating methods. As a private contractor for the u.s. government, it resembled hundreds of other contractors in observing the wartime totems of secrecy and speed; and in failing to live up to its own expectations and those of others, it was not particularly unusual either. It was the third government, the British, which sought to alter Eldorado's being, and it succeeded. The third year of the war saw the British still beset and beleaguered by the Germans, and since December 1941, by the Japanese as well. The spring of 1942 brought news of one disaster after another, as the great imperial bastions in the Far East fell to the Japanese: Hong Kong (where Canadian troops were involved), Singapore, the East Indies, and finally Burma. In Africa, where British armies were fighting the Germans in the Libyan desert, the

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fortress of Tobruk surrendered to Rommel. There were only a few indications of what the Germans were doing to enhance their weaponry. As we now know, the Germans were trying out new varieties of tanks and jet planes, but with the leisure that comes of a three-year string of victories. As for an atomic bomb, the idea was being pursued, but without any great feeling of urgency. The allies, however, did not know this, or did not know it to be incontrovertibly true, and they redoubled their efforts. The British atomic project, known as 'Tube Alloys' for greater security, fell under the general direction of Sir John Anderson, Lord President of the Council in the Churchill coalition government. Anderson, whom we have met before, was uniquely qualified to understand the possibilities of atomic fission. He knew about radium and uranium, and he was disposed to forward atomic research within the limits of Britain's capacity to pay for it, or to induce others to share in the final bill. In doing so, neither he nor his colleagues were ignorant of the possibility that what was good for an explosion tomorrow might be good for generating electricity the day after — the very thing, it might seem, to give a badly needed leg up to British industry when the aftermath of war found Britain to be, for all intents and purposes, bankrupt. Many distinguished scientists and technicians peopled the British atomic project. For the most part they do not affect our story, but it is useful to draw attention to a few outstanding personalities. The directorate of Tube Alloys was confided at an early stage to the care of the research director of Imperial Chemical Industries (the British industrial conglomerate), Wallace Akers. Akers was in many ways well suited for the post: he had intelligence, initiative, and drive. He was virtually indefatigable. But diplomacy was not his forte, and he had a tendency to leap to conclusions that ran the gamut from wild optimism to deep depression. When combined with Anderson's imperious, not to say arrogant, inclination to run roughshod over difficulties real or perceived, Akers created the possibility of trouble.1 Trouble did not show up for some time, however. The spring of 1942 was a honeymoon between the British and the Americans as far as mutual disclosure of information went. Until the summer, the Americans were more anxious than the British to exchange and

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combine efforts; and for the whole calendar year the British counted upon American willingness to run a genuinely 'combined' operation of a kind similar to other joint war directorates. That was not to be the case. For a variety of reasons, which included distrust of Akers and suspicion of British motives for sharing information which might be put to use after the war for atomic power plants, the Americans drew back. They did not do so, however, before the British had decided to move the bulk of their own atomic team to North America where it could be located close to the American scientific and engineering groups. The obvious location for such a British effort, it was decided, was Canada. I

On the morning of 15 June 1942, three men were ushered into the office of the prime minister of Canada, William Lyon Mackenzie King. One was familiar to the prime minister: Malcolm MacDonald, the British high commissioner, son of a former British prime minister, and himself a former member of the British cabinet. MacDonald was a personal favourite of Mackenzie King, who valued his opinion and appreciated his company; and MacDonald returned his regard, carefully explaining to his superiors in London that this strange little man was a shrewd and tough political operator with an almost instinctive grasp of what could or could not be done in Canada. MacDonald introduced his companions to King. One was senior, Professor G.P. Thomson of the University of London. Thomson had been associated with Tube Alloys from the beginning, and before. His was the prestige and authority that would weigh heavily with the prime minister. The other, Michael Perrin, had worked for Akers at Imperial Chemical Industries prior to the war, and had transferred to Tube Alloys when Akers moved over. At this meeting he was acting as Akers's deputy and representative. MacDonald opened the discussion, which King afterwards recorded in his diary. What the British wanted, King learned, 'was the acquisition of some property in Canada, so as to prevent competition in price on a mineral much needed in the manufacture of explosives.' Perrin then took over. What was involved, he told

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the Canadian leader, was a 'military weapon of immense destructive force,' based on intra-atomic energy. Naturally it also had implications for industrial power later, but for the moment the bomb was the thing. Perrin recalled that 'a look of absolute horror and panic' stole over King's face as the lecture proceeded. 'The first country to possess a military weapon of this kind would win the war,' King was told. What were the Germans doing? he asked. That, Perrin answered, was unknown, beyond the fact that they were working on it. But one thing MacDonald said, was known: German Intelligence had been asked to find out what was happening in Britain and the United States. King was convinced, but as yet he had little understanding of what was being asked. 'That's a job for C.D. Howe,' he told his visitors. Another meeting was convened, this time with Howe presiding and CJ. Mackenzie, president of the National Research Council, sitting at his side. The British trio repeated what they had told the prime minister. This time they found more understanding, as well as some familiarity with the precise subject under discussion. Howe had known about uranium supply since March, when he had arranged to get LaBine his priorities; Mackenzie had learned, directly from the British, that uranium experiments were going on, and his own National Research Council had been running some experiments of its own. Once the scientific preliminaries were over, discussion centred directly on radium and uranium supply. The British had noticed a tendency for uranium prices to rise during the winter and spring and it is possible that they had in the back of their minds the fear that Pregel or some similar character would corner the uranium market. It was obviously important that the government 'control' Eldorado; but what would 'control' mean? Existing emergency powers could be used, Howe told his visitors. The company could be seized and an administrator put in on behalf of the government. It had happened before, but there would inevitably be publicity which would, under the circumstances, be undesirable. Moreover, there was the question of what would happen to the company after the war. This presumably had occurred to the British as well; that it did so to Howe indicates that the Canadian side was fully aware that they were talking about an issue of extreme, and permanent,

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importance. If Eldorado were seized using the government's emergency powers, the company would revert to its original ownership and control when the war emergency lapsed. If the company could not be expropriated, and if government 'control' on a long-term basis were desirable, then there was only one other option: voluntary purchase. Better still, Howe told his visitors, the company belonged to Gilbert LaBine, who, according to a British telegram describing what was said, 'is a personal friend of his, is extremely reliable and well disposed.' It presumably went without saying that Howe considered LaBine to be a good manager, because Howe seemed to assume that LaBine could be left in place. Certainly it would have caused comment, and negated the point of buying the company, if it then appeared that the control of the company had actually been transferred. The British agreed to Howe's proposition. But important as that proposition was, it did not settle the matter of Eldorado's 'control.' Once the shares were purchased, who would own them? This question may now seem rhetorical, but it was not at the time. In coming to Ottawa, the British delegation contemplated acquiring control for themselves and the Americans, in effect locating a small and autonomous part of Tube Alloys and the Manhattan Project on Canadian soil. This idea was now put to Howe who did not reject it. Not only would Howe share control with the British and the Americans, but 'indeed his present view seems to be that the Canadian Government would not even mind having no large share of control provided we (the British) had this either by ourselves or with American Government.' From this emerged a conclusion that eventually Eldorado would be subject to tripartite control, presumably based on a division of interests into thirds. The Americans were to be informed both by the British and by CJ. Mackenzie of what was contemplated, and their approval sought. This was in the spirit of co-operation that then ruled in trans-Atlantic atomic relations; it also reflected the likelihood of direct American investment in Eldorado stock. The most surprising thing about this proposal is that C.D. Howe agreed to it. It was, on the face of it, a most unusual proposal to be put by one sovereign government to another. It was not without its precedents, however. During the First World War, the British

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government had built and owned a whole string of munitions factories in Canada, and in the early stages of the Second World War there had been heavy British investment in Canadian plants. By 1942, however, British investment was being wound up and bought up by the Canadian government, a reflection of the simple fact that Britain had run out of dollars and that Canada was willing and able to foot the bill. There was no doubt as to where any money that Britain would invest in Eldorado was coming from: Canadian loans and credits to Great Britain to buy munitions and supplies in Canada would pay. The trend of Canadian policy, by 1942, was against new investment by another government in Canada. Howe was sometimes subject to enthusiasms. He gave the highest priority to collaboration in the war effort, and he had a weakness for bold, imaginative schemes with a touch of high technology in them. He liked to give positive and direct answers, and he did so without always considering whether there were any larger or more abstract considerations at stake. What the British had to tell him was exciting, the very thing to set off the minister's imagination. He was confident from the beginning that he knew just how to organize matters, and if on the way he could be obliging to the British, he was more than willing to do so. At a second meeting with Mackenzie King later on 15 June, it was decided that Howe would approach Gilbert LaBine, who was believed to own a majority of Eldorado's shares, in strictest secrecy. He would offer to buy the shares and thereby assume control, secretly, of Eldorado Gold Mines Limited. Secrecy dictated that there be no external change in Eldorado's status, and it was therefore assumed that LaBine would remain with his company and that things would proceed, outwardly, as before. At some future point, control would pass into the hands of a tripartite directorate, consisting of the United States and the United Kingdom as senior partners, and Canada as junior. This arrangement was put to Vannevar Bush and was agreed to. Unluckily this selfless arrangement had a flaw. Someone had to run the company. The British did not ask for any detailed input into Eldorado's affairs, but were satisfied with a vague promise of future accommodation. In the meantime, all agreed that Howe had control; under Howe, LaBine would do the actual managing. By

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their failure to consider what control would mean in practical, managerial terms, the British surrendered their improbable advantage in getting Howe to agree to share 'control.' In the meantime, things would go on just as before.2 II

Gilbert LaBine was not told that the purchase of shares in his company was only the first step in a long and complicated process of diplomatic to-ing and fro-ing. The first step, for Howe, was to apprise his colleague, J.L. Ilsley, the minister of Finance, of what was proposed, and to get Ilsley to find the necessary money. Next, Howe assigned his financial adviser, Frank Brown, to the task of determining a fair price for Eldorado stock. With Ilsley's consent and Brown's report in his hand, Howe broke the news to LaBine in a meeting in his office in Ottawa on 7 July. Under the circumstances, LaBine's reaction was everything that could have been desired. Howe asked him to sell his shares in secret to the Canadian government and LaBine agreed. Howe asked him to stay on as president of a company that was no longer his, and he agreed to that, too. He would, moreover, try to purchase more, on Howe's behalf, also in secret. The only fly in the ointment was that LaBine, and the LaBine family, did not own a majority of Eldorado's shares, which numbered almost 4,000,000 after the 1936 arrangements with the Snyder syndicate. T am prepared to deliver to you,' Eldorado's president wrote to Howe, '1,000,303 shares of the stock of Eldorado Gold Mines Limited at $1.25 a share. I shall endeavour to purchase all further shares that I may be able to do privately, and I further agree to deliver 40,000 other shares which I am personally interested in, which is [sic] at the moment tied up in a separate account as collateral.' Howe replied the same day. 'Representing His Majesty the King in the Right of the Dominion of Canada I accept your offer,' he wrote. He quickly informed G.P. Thomson of what had occurred, and a week later, on 15 July, summarized events for Malcolm MacDonald. 'Gilbert LaBine is being most co-operative,' he told the British high commissioner. In addition to the million LaBine shares just bought, Howe observed that he was 'now taking steps to

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quietly purchase another million shares from banks or trust companies.'3 For the next eighteen months, LaBine and John Proctor of the Imperial Bank criss-crossed Canada and the United States looking for shares to buy. When a likely prospect was spotted, Proctor long afterwards recalled, they dropped everything to catch the train east, west, or south. The money was available, but secretly. Throughout, as Howe warned LaBine, 'it is understood that you will purchase these shares by direct negotiation, without disturbing the stock market. The utmost secrecy is necessary for strategic reasons understood by you.' At the same time, Eldorado shares continued to be traded on the stock market and the company remained, to all appearances, a normal commercial enterprise.4 Was the price paid for Eldorado a fair one? The $1.25 was far less than some of Eldorado's investors might have hoped for, but far more than the average price for the company's stock over the previous ten years. Mining was a risky business, and mining investors understood that. Eldorado had never paid a dividend, though it had an operating profit. Its investors were never told that the company was keeping piles of junk in the Manitoba bush on the books as assets in order to prepare a respectable balance sheet, nor did company officers stress that the value assigned to the company's inventory prior to 1942 was based at least as much on optimism as on crude realism. The stock market did reflect investors' caution in touching the shares of a company whose prospects were at best considered cloudy. On 22 June 1942, with a crew back at the mine and orders starting to pile up, Eldorado's stock traded at 40 cents. By early July it was trading at 49 cents or 50 cents, far less than the $1.25 offered to LaBine. Obviously, however, the government could not start buying on the open market without driving up the price, and it is possible that a good speculative flurry could have seen the share price pass $1.00. The government knew, and LaBine knew, that if news of Eldorado's good fortune was divulged, its operating profits would look much healthier in the years ahead. Brown estimated that the new demand for uranium might 'boost the operation profits 10 times, say to 55 cents a share or roughly $2,200,000; the shareholders would still not have more than 51 cents per share

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available for dividends because excess profits [tax] would take 40 cents and forced saving 10 cents.' Shareholders would not know this, but realistically considered even a profitable and open company would return less than what the government might be prepared to offer. In Brown's view, 'most shareholders — havin carried the stock without dividends for years — would gladly take $1.00. If we could buy control at $1.10 to $1.25 everyone should be satisfied and' — just as important — 'we should not be open to criticism.'5 Criticism there was, of course, when the purchase of shares became public and after Eldorado became fully and openly a government-owned company. But a subsequent and careful assessment of the worth of Eldorado's stock came to much the same conclusion as Brown did. The high point of Eldorado stock, in 1933, was over $8 a share, a figure that, Lesslie Thomson wrote, 'does not reflect any earning capacity. It merely represents stock market manipulation introduced by a combination of wild rumour, some preliminary success in competition with the Belgians in radium sales, and other factors which today [1946] are difficult to identify.' The Snyder period in Eldorado's affairs had also resulted in an increase in price, but that, too, in Thomson's opinion, was 'unwarranted.' Some criticism attached to the method chosen to transfer Eldorado into government hands. Expropriation of assets may in some cases offer a surer guide to worth than purchase of shares. Unfortunately, given the secrecy that attended the transaction, a proper valuation of assets was excluded. Share purchase was simpler and quicker — and above all, easier to keep quiet.6 The transaction could not be concealed from the board of directors, and therefore it was also known to those company officers — refinery manager Marcel Pochon and secretary-treasurer Carl French — who sat on the board. Their confidential knowledge posed a peculiar problem to board members, best expressed in a letter to Howe in 1947 from John MacAulay of Winnipeg. MacAulay had had a long connection with Eldorado. He was sensitive to shareholders' concerns, as well as to the fact that the board was supposed to allow the shareholders enough information to permit them to make the best judgment they could, in their own

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interest, on their own invested money. 'From the time I heard in the first instance of the government's desire to acquire a controlling interest in the company,' MacAulay wrote, 'I felt considerable embarrassment. Shareholders who had had the stock for years were disposing of their stock at prices ranging from 35 £ to 50^ when the directors had information that it would ultimately be worth $1.25. The directors were obligated to maintain secrecy; but that would not prevent criticism of them if the facts were now made available to the shareholders.'7 In the interest of secrecy, the board was now eclipsed. Board members were told only what could not be avoided; details of contracts, negotiations, and shipments were cloaked in secrecy. The board's membership continued as before, however: change in form, as opposed to change in fact, would have been unwelcome. Even the changes in fact had the effect of concentrating authority in those few hands not affected by security or secrecy requirements: Gilbert LaBine and his immediate staff - and, of course, Boris Pregel. In the month of July 1942, then, Eldorado Gold Mines Limited was not nationalized. The Government of Canada acquired just over 25% of the 3,905,046 shares then issued by the company. This block of shares conferred control under any ordinary circumstances, and especially as long as the company was assumed to be a semi-moribund purveyor of uranium oxide to pottery works. Gilbert LaBine, president, remained in office as the nominee of the dominant shareholder, the Government of Canada. On 15 July, the government passed a secret order-in-council that set aside $4,900,000 for the purchase of Eldorado stock at a maximum price of $1.25 a share. Gilbert LaBine promised to buy and sell, at cost, any shares he could find, in order to give 'His Majesty effective control of the said company by way of a majority voting power.'8 Majority voting power was some way in the offing. But the real significance of the acquisition of shares by the government was not that it gave that government immediate 'control' over the company. In terms of Eldorado's day-to-day operations, and even in terms of its important decisions, this was not so. Adequate powers already existed to direct the company, if required, but Howe did

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not believe that they were required. Since it was important that it seem business as usual around head office, that was precisely what happened. Business as usual continued. Contracts were signed, ore was refined, workers were hired, all without any more reference to the Government of Canada than would otherwise have been the case. If the actual fact of nationalization in practice meant little, at least in the summer of 1942, what did the share purchase scheme achieve? The answer to that question is a negative one. The share purchase scheme postponed and ultimately prevented the fruition of the tripartite control proposal made by the British to Howe, and accepted by him at the 15 June meeting. Pressure of business and the urgency of affairs took care of the rest. Howe had only so much time to devote to uranium, important though that was. In the summer of 1942, he had to battle his colleagues in the cabinet over the availability of industrial manpower (including miners), run the affairs of an expanding department, supervise Canada's air policy, and act as court of last resort for over twenty different crown corporations. It was, an American diplomat reported, like the ringmaster 'not of a three ring circus, but of a thirty ring circus, with Mr. Howe playing a vital role in each ring.' In fact, Howe's role was closer to that of an impresario, leaving to trusted subordinates the details in a thousand different areas, while concentrating on whatever emergencies the moment brings. That was Howe's technique in dealing with his other crown companies; it was the technique he proposed to use with Gilbert LaBine.9 Ill

If Eldorado's political destinies were regulated to the apparent satisfaction of everyone concerned, the company's production fortunes were not. It was not Eldorado's fault that its order books were jammed for the next two or three years with Great Bear Lake uranium and Belgian concentrates, but that was an inescapable fact. And so, when a new order arrived on Gilbert LaBine's desk it was bound to place his finely balanced system of priorities in jeopardy. The bombshell arrived in the form of an order from the British

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High Commission to supply 20 tons of 'purest oxide.' LaBine accepted the order, while warning Howe that the existing American order might make it difficult to fill for some time. Howe offered to intervene, if necessary, to permit insertion of the British order between customers, but the British expressed only the hope that the United States would be understanding of British needs, and left the matter at that. Since there were no firm countermands, LaBine proceeded with the existing u.s. order until, in October, he was able to start work on the British go-ton order.10 The British were becoming impatient, but again accepted the situation. The Americans do not seem to have raised any strong objection, which would seem to bear out LaBine's later assertion that he had a 'verbal understanding' with the Americans that 'they know this is a Canadian company and that the requirements of the governments of both Canada and the United Kingdom should be taken care of.' That was probably true, but there were two unexpressed conditions: first, the Americans did not expect Canadian or British requirements to be very large; and second, their perception of Canada was vaguer and less respectful than LaBine realized. There were Americans and Americans. Some, like Bush and Conant at the top, might be expected to know that Canada was a separate and sovereign country. Others, like General Leslie Groves, the chief engineer of the Manhattan Project, had not included a course on international law or contemporary world politics in their background. 'Do you know anything of a Mr. C.D. Howe up in Canada?' Groves was to ask one of his officers in 1943. 'Do you know how I could get in touch with him?' 11 In October 1942, Groves was himself still pretty much an unknown quantity, having been at his post for barely a month. It could reasonably be assumed that things would proceed much as before, and it was under that impression that the British decided to do two things. On 17 August 1942, they approached Canadian authorities to ask if a scientific team could be located in Canada to work on the establishment of an atomic facility. Mackenzie and Howe were favourably disposed. By the end of October a site for the project was agreed upon, at the Universite de Montreal, and a liaison officer, Lesslie Thomson, a senior official in munitions and supply, was appointed. The objective of the Montreal group was to

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develop a reactor technology using natural uranium as a fuel and heavy water as a moderator — in other words, to determine whether a controlled nuclear reaction could be achieved using this technology. The heavy water required in this program was supplied initially by the Americans. Subsequently, supplies were also obtained from a plant operated by Consolidated Mining and Smelting at Trail.12 At this point, Eldorado had begun refining the 2O-ton British order, and 5 tons of it had already left for the British Isles. On 2 November, Akers made a decision to improve the quality of the oxide arriving in the United Kingdom. It should, he wrote, be shipped first to St Louis for treatment by the Mallinckrodt process. This would add 50% to the cost, but it was worth it in terms of improved purity. Howe obligingly arranged to pay for the extra cost. The 15 tons duly travelled south. Next, on 29 November, Akers learned that the Americans wished to use all or part of the 15 tons. Under the circumstances, he had no strong objections since presumably the British could recoup from a later shipment. A discussion with Arthur Compton of the Chicago laboratory on 4 December (Hans Halban, the head of the Montreal laboratory, was also present) proved highly encouraging. 'Halban [and] self had very satisfactory talk with Compton on supply Oxide metal graphite liquid,' Akers reported. Akers accordingly asked Howe to deliver the 15 tons to the Americans for purification, on the understanding that the Americans would deliver three tons to the Montreal project by i March, reserving five tons more for the British. Howe did as he was asked.13 All seemed to be proceeding as it should. Howe had sat in on a discussion of the shape of the Montreal project in October, in London. Passing reference was made to Howe's secret purchase of Eldorado shares, an enterprise which was, according to Howe, going well. The Canadian government would have 'control' within two or three months. As for the question of dividing that control, Howe was becoming less positive. The British minutes record that 'Mr. Howe said that he thought it would be preferable not to pursue with the u.s. Government the possibility of their purchasing a proportion of the shares unless they themselves raised the subject.' Anderson, who was presiding, did not demur. It can only

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be assumed that the possibility of joint Anglo-Canadian control was left open. But the British were not finished with the topic of Eldorado. 'In the course of discussion of the previous item,' the British minutes continue, 'reference was made to the activities of Mr. Boris Pregel, a naturalised Frenchman, who had previously been the selling Agent of the Union Miniere. After the fall of France, Mr. Pregel had gone to the U.S.A. and had signed a contract with Eldorado Gold Mines Limited...' The British had certain information on Pregel that Howe might be interested in. Perrin handed over a note on the subject, and Howe agreed to study it and take such action as thereafter seemed advisable. This was, in all probability, the first time that Pregel's name had reached the ministerial level in Canada. There had been concern in the RCMP in 1941 over alleged radium smuggling with which Pregel was rumoured to be linked, but that rumour was evidently not pursued. Perrin's memorandum suggested that Pregel was a man of doubtful character, whose commercial enterprises were both numerous and complicated. These stretched back to before the war, and, presumably using a source close to Union Miniere, Perrin listed Pregel's cartel activities, reputed sales of radium by one of his companies, Demetra S.A. of Zurich, which had resulted in tha company being placed on the Ministry of Economic Warfare's 'black list' for alleged trading with the enemy. The black list designation was subsequently removed for lack of evidence. Pregel was also said to be interested in various patents bearing on the uses of nuclear fission for power production, which could indicate 'that he is trying to build up a patent position in that field.' Perhaps most damning of all, Pregel knew too much. He was, the British claimed, 'fully aware of the present interest in uranium' and had conducted 'detailed technical discussions on the purity required in the product, with members of the Chicago group.' Howe took the British note back to Canada with him. Who was Pregel, he asked LaBine, and what was the nature of his connection with Eldorado? LaBine, in response, sketched out Pregel's known background, and enclosed copies of his contracts with Eldorado. He noted that part of Pregel's contract permitted him to take his commissions in radium, if he chose, though the disposition of that

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radium was to be made with Eldorado's knowledge and approval. Howe was partly satisfied. He accepted LaBine's 'assurance that Pregel is loyal to your Company and efficient in carrying on its affairs.' Nevertheless, 'the new situation' - presumably the Manhattan and Montreal projects — 'may indicate the desirability of a different relationship between Eldorado and Pregel.' To be absolutely certain, Howe handed LaBine a copy of the British memorandum on Pregel. LaBine seems to have presented the British allegations in detail to Pregel, who issued a long rebuttal. Pregel admitted that certain Union Miniere officials were hostile to him, especially Gustave Lechien. Pregel took credit for driving Lechien out of the Union Miniere. Pregel's radium trading was above board, and signs of co-operation between himself and Sengier of Union Miniere were easily explained. As for the charge that Pregel knew too much, that could well be true. 'His knowledge of the uranium field is of vital importance,' LaBine told Howe, and he had attestations from various u.s. Army arsenals, the Naval Research Laboratory, and Columbia University's Division of War Research to prove it. These LaBine enclosed for Howe's attention. In fact, the British description of Pregel was sloppily prepared, excessively dependent on inaccurate hearsay, and easy to refute in detail. So many of its details were inaccurate that doubt was cast on the validity of the document as a whole. Pregel's powerful defence, transmitted through LaBine, seems to have convinced Howe, who let the matter drop. But neither the British nor the Americans were through with Pregel.14 For the moment, Pregel was swallowed up in greater matters: with the new year 1943 came a new American policy, and a change in the relations between the erstwhile atomic allies. Briefly, the Americans informed the British that the days of free-and-easy co-operation were over. In future, information and supplies would be exchanged on a strict need-to-know basis. Need to know was established by estimating whether, and how much, a given project could contribute to the development of an atomic weapon for use in the war. Post-war projects were excluded, at least in part because the Americans feared that the British and Akers in particular were

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preparing to take research paid for by American taxpayers and carried out by (largely) American talent and use it for the benefit of Great Britain. The British were stung and shocked by this development. Akers protested vehemently, and attempted to enlist the Canadian authorities on his side. All the expectations on which the Montreal laboratory was founded had now come unglued. American cooperation would henceforth be both grudging and self-interested. And yet, because British financial and scientific resources were inferior to that of the Americans, and because the sheer size of the American program allowed them to tackle any problem that seemed either relevant or promising without having to establish immediate priorities, it was difficult to see what leverage the British could now bring to bear. Naturally Eldorado played a part in this. Canada was a part of the British Empire, and Howe had promised, or so Akers thought, to satisfy British demands for uranium. Indeed, Eldorado was a critical link in the American supply chain, and it did not take a great deal of imagination to see the company converted into a bargaining counter, to be placed on the table in exchange for co-operation and information. This view, however, ignored the fact that the Americans had tied up Eldorado's production, and that even the 20-ton order had occupied a relatively lower place on the order book than the existing 35O-ton American order, not to mention the Belgian refining contracts. There could be no doubt that the Americans had been accommodating in permitting the go-ton order to go through when it did, in October. The British had accommodated them in return, by foregoing immediate return of the 15-ton balance of their order. But that was in December. When the first return shipment was to be made, in March, there was no sign of the uranium. Inquiries to the Corps of Engineers produced assurances of prompt delivery, and still no uranium. Eldorado assured Howe that his conditions had been met, and that the u.s. Army well understood that the uranium in question must be returned. On 24 March, Pregel was reminded that 'the co-operation that we have been getting from the Canadian Government is due entirely to the Hon. C.D. Howe

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and if his requests are not taken care of we can no longer expect his co-operation.'15 Eventually Howe prevailed. The 2o-ton order was completed in shipments of 5, 3, 5, and finally 7 tons, but not before the summer of 1943. The slowness with which the Americans responded to urgent requests from Canada pointed up their perception that they needed every pound of refined uranium they could get; and it did not promise well for the future. The British consoled themselves with the thought that they need not rely on the Americans for the future, since the Eldorado refinery lay outside American jurisdiction. The Montreal team began to give thought to what it would need in the way of refined uranium, and arrived at, first, 20, then 40, and then 120 tons to be delivered in monthly batches of 10 tons through the balance of 1943 and into 1944/6 These plans created a certain feeling of independence and even a kind of optimism, although the larger issues of Anglo-American co-operation remained unresolved. The optimism prevailed until Bertrand Goldschmidt, a Frenchman working on the Montreal team, decided to visit Chicago. The previous year Goldschmidt, then a recent refugee from France, had worked for a few months at the Port Hope refinery, where he had developed a strong sympathy for his compatriot Marcel Pochon. Since the train passed through Port Hope, Goldschmidt stopped off to see Pochon. The two men talked, Goldschmidt returned to the railway station, and then instead of catching the westward bound train, towards Toronto and Chicago, he slipped across the tracks and hopped the eastbound train, back to Montreal.17 His colleagues in Montreal may have thought that Goldschmidt was bringing reassurances that they would have the 40 tons they needed to get on with the job of constructing a heavy-water reactor. In fact, he was bringing the exact opposite message. For the first time, the British learned just what the numbers and tonnages attached to Eldorado's various contracts meant. Beginning with what the British already knew, there was the 35o-ton contract, which had been suspended in the fall of 1942, when the Belgian ore came on stream. That had presumed deliveries at the rate of a ton a day, and would have lasted into June of 1943, under ordinary

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circumstances. But the circumstances, not being ordinary, dictated otherwise. The Belgian contract was supposed, as of May 1943, to last until the end of 1943, at which time the outstanding balance of the 35o-ton contract would resume. There were 195 tons outstanding, and at the rate of a ton a day that would take Eldorado into the summer of 1944. The Americans had other plans. First, they had some lower-grade Belgian concentrate, mentioned above in connection with the complicated refining problems it posed. These problems Pochon anticipated, in speaking to Goldschmidt of a 'less easy proposition.' It might seem that matters could hardly be worse, from the British point of view. But they were. The Americans had negotiated, through Pregel, another contract, for 500 additional tons of Eldorado oxide. That meant that there were not 195, but 695 tons outstanding under contract to the United States or, as Goldschmidt explained, 'not far from 3 years of production' at the mine. That meant that even if the British managed to produce a duplicate refinery, there would still be no ore for them to refine. If that were not enough, Goldschmidt added that he had learned (doubtless ultimately from Pregel) that the Americans also had 200 tons of oxide derived from American vanadium residues. Altogether, the Americans had roughly 2700 tons of oxide; the British had about 20.l8 This news combined with a total lack of progress over the wider issues of atomic co-operation to stimulate despondency in certain British quarters. The official reaction was distinctly unpleasant. CJ. Mackenzie received the first intimations of British displeasure in a discussion in London with Akers on 14 May. Akers already knew that Mackenzie wished to avoid at all costs an open breach between the British and the Americans, and deplored any action that would aggravate the existing tense situation. The situation was proving very unfortunate for the Montreal group, and that was aggravated, according to Mackenzie, by their lack of uranium, and by American possession of the Belgian stocks. In that case, Akers suggested, 'surely the whole stock plus current production of Eldorado would be available to the British.' A curious conversation then ensued. Akers knew what Goldschmidt had told him, which was essentially accurate. Mackenzie apparently did not, and in

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replying to Akers referred only to the Belgian contract and did not mention Eldorado's own commitments to the u.s. Army. When Akers offered to construct a small refinery to handle Eldorado's own ore, Mackenzie demurred. Finally, Akers asked 'if he thought that this was reasonable in view of the fact that it was the British Government which had suggested that Eldorado should be acquired so as to secure supplies of uranium. His reply,' Akers later minuted, 'was that the Canadian Government had undertaken to get control over Eldorado on the understanding that the production was to be available for joint British, Canadian and American purposes. He implied that the break between the British and Americans had radically altered the whole position.'19 Mackenzie's failure to expound Eldorado's entire range of commitments must have seemed curious, and probably insincere, to Akers. But his silence on the matter was indicative of a larger problem. The Canadian government did not know what Eldorado's commitments were. It expected, when the great joint enterprise began, that any difficulties could be ironed out in a rational discussion - as indeed had happened when the Americans had conceded 20 tons to the British, and the British had in turn allowed the Americans' more pressing needs to determine who got first crack at 'their' oxide. Those happy days were already long past. The British were now trying to piece together an atomic program that could, if absolutely necessary, be independent of the Americans or, better still, were searching for some bargaining counter that would offset the Americans' manifest bargaining strength. The British now took refuge in improbabilities. Perhaps an independent atomic program could be established using low-grade Portuguese uranium, or even supplies from the Soviet Union. One British official speculated that CJ. Mackenzie was part of the problem, and wondered whether Mackenzie King could be persuaded to 'find some special mission' for him, one 'which would remove him from the field of Tube Alloys without putting him in a position where he could do us harm in other matters.' That particular project remained safely in the files of the British Cabinet Office, fortunately, since its inclusion in any British negotiating package would have been enough to send C.D. Howe into orbit.20

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The whole mess now landed on Howe's desk, where it stayed, with brief interludes, for the next two months. Howe's whole style of management was predicated on the decentralization of responsibility. As far as Howe was concerned, he had at every point done what the British had asked of him. Suddenly he was receiving blame for a situation that he had never heard of. Anxiously he asked LaBine what was going on. 'A report' had reached the British government that Eldorado had sold two years output of Great Bear Lake uranium to the Americans. 'The British,' Howe told LaBine, 'feel that this excludes them from the market.' What could be happening? T have no knowledge of any such sale,' the minister continued, 'and I feel sure that you would not dispose of your product in a way that would interfere with filling urgent requisitions from the United Kingdom.' Howe personally was opposed to any such thing. Howe's letter was sent on 26 May; LaBine replied two days later. The British reports were broadly true, he told the minister, though he disputed the length of time that would be required to complete all the mining and refining that Eldorado had committed itself to. The Belgian and Great Bear ore covered under existing contracts could be handled by the end of December 1944. LaBine feebly protested that a letter from Howe about the go-ton contract the previous December had led him to conclude that 'it was good policy to accept all contracts that came our way for the refining of ore, in order to give our industry revenue and at the same time protect our company against other interests which were anxious to take on job refining for the u.s. Government.' Just what these other interests were remained unspecified; probably no greater precision was possible. The argument was specious; no reading, however strained, of Howe's letter would have yielded the meaning that LaBine claimed to have derived. But two weeks later, on 22 December, LaBine went ahead and signed a contract for an extra 500 tons of Eldorado ore with the u.s. Army Corps of Engineers. Surely, the Eldorado president protested, that did not mean that the Americans had an absolute monopoly over Eldorado's output. He had a 'verbal understanding' with the u.s. Army that 'we will not be prevented from supplying the needs of our own Government for any of our products... We have been definitely led to

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believe by verbal understanding that they know that this is a Canadian company and that the requirements of both Canada and the United Kingdom should be taken care of.'21 The experience of the 20-ton order showed how much that particular assurance was worth. The Americans, until recently short of ore themselves, had scant patience for what they must have considered to be sideshows. Groves's geologists told him that Eldorado was falling behind in its production, and that further refining capacity might be necessary to keep abreast of requirements by the middle of 1944. It was, nevertheless, true that the Corps of Engineers had applied to the maxim that Biggest is Best, and that in terms of oxide they had more than they could ultimately handle, or need, for war purposes.22 British fears that they could not get adequate supplies of oxide were justified for another reason. The Americans, when they talked to LaBine, were thinking in terms of 20 tons. When the British asked for 120, they recoiled. When Howe put the idea to Colonel Nichols and another Manhattan District officer at a meeting in Ottawa in June, the Americans refused to accept a contractual obligation 'giving priority to British or Canadian Government requirements.' Howe and Mackenzie, who was present, then proposed an expedient. Could a contract be made with 'a provision that if the British or Canadian Governments came forward with enquiries for oxide, then the position would be reviewed by a committee composed of Mackenzie, as chairman, with a representative of the United Kingdom and the United States. This committee would then examine the reason for requirements by the United States on the one hand, and by the United Kingdom and Canada on the other. It would then allot the material to whichever country seemed, in the view of the committee, to be proposing to use it in the way most likely to assist the immediate war effort.'23 Akers, to whom Mackenzie described the proposal, was unimpressed. Distrusting Mackenzie and viewing him as an accomplice if not as a tool of the Americans, Akers thought that in such a case the cards would automatically be stacked against the British. He, or someone else in the British delegation, then allowed it to become known around Ottawa that Winston Churchill himself had taken

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an interest in the matter, and that Churchill thought that Howe was 'selling the British Empire down the stream.' Ottawa being a small town, it did not take long for this suggestion to reach Howe, who became, according to Mackenzie's mild paraphrase, 'fed up.'24 Mackenzie next travelled to Washington to test the atmosphere and scout the landscape. Conant received him warmly, but held out little hope of substantial change. Interventions by Winston Churchill had not managed to budge the essential American position. Indeed, though President Roosevelt himself was inclined to do something for the British, his officials were not. Footdragging, confusion and obfuscation, therefore, carried the day, and the crisis — and with it Canada's embarrassing dilemma — dragged on. When Mackenzie reported to Howe on 13 July, he found him 'very tired and...annoyed at the United Kingdom attitude, and at the slightest cause I think he would close the whole thing down.' Fortunately, Howe was leaving on vacation, which would get him, temporarily, out of Ottawa's baking summer heat, and which would restore his strength and spirits. As Howe's entourage knew, when the minister became over-tired and frustrated, he was quite capable of taking drastic and sometimes over-hasty steps.25 What was at issue in these steamy summer discussions was rather different from what was actually at stake. The British wished Howe to concede that there were two contracts for Eldorado ore outstanding with the Americans, the original 35o-ton document, and the December 1942 contract for a further 500 tons. Howe, for whatever reason, 'still denies that any American contract for Eldorado oxide exists beyond the first for 350 tons, although LaBine informed Thomson last week that the further contract for 500 tons was signed on December 22,' Akers wrote on 30 June. Howe reiterated that he had 'the whole position under satisfactory control and resents strongly attempts by others such as Thomson in his discussions with LaBine to clear up the position.26 Once Howe had taken that position, the British had two choices. They could storm it, thereby creating an exceedingly embarrassing confrontation with Howe, of a kind that would not stop with uranium but might extend over the whole billion-dollar field of Canadian aid to the United Kingdom. Or they could circumvent it,

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by focusing on reaching some sort of modus vivendi satisfactory to all three parties to the uranium imbroglio. They could, in fact, turn to the mechanism suggested by Mackenzie on 17 June, and subsequently scouted by MacDonald: tripartite control and allocation of uranium supplies. Unluckily Akers, who seems to have been just as stubborn as Howe, insisted on confrontation. By now it was time for some good luck, since good management appeared impossible of achievement. The first stroke of luck was Howe's absence from Ottawa, and so when MacDonald and Akers arrived in Mackenzie's office for a 'frank discussion' on 13 July there was no chance that it would involve the minister. MacDonald, in Mackenzie's opinion, was embarrassed, but he was 'being pushed by Akers, who wants to browbeat Mr. Howe about the uranium contracts.' And behind Akers, as MacDonald knew, was the angry figure of Sir John Anderson. Akers, Mackenzie told his diary, 'was all for telephoning Mr. Howe to tell LaBine not to enter in any more contracts.' Mackenzie, instead, told the British that if they 'phoned Howe the first night of his holidays, it would spoil the whole thing.'27 MacDonald, the same day, gloomily minuted that the British had scant hopes of getting the Canadians to modify their position. 'In the present mood of Mr. Howe,' he wrote, 'U.K. would not get all & probably not even the greater part of Eldorado output, if USA wanted any.' That was almost certainly correct, as the British were slowly beginning to realize. That being the case, the solution lay elsewhere, and on a different level. Again there were two possibilities. It might be, as a telegram from London to Akers speculated, that Roosevelt would manage to work out a satisfactory return to co-operation and interchange between the British and American atomic projects. There would then, presumably, be no problem. If, however, 'the President definitely fails to implement his promise, we shall have to try, with such Canadian help as we can get, to arrange with Americans for reasonable division of supplies of oxide, etc. But we must realize that the decision will lie with the Americans and that, without them, the Canadians will be powerless however good their intentions.'28 This was good advice, which Akers for the moment refused to concede. Instead, he, with MacDonald's concurrence, sought out

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Pregel in an effort to discover what the latter knew. If Pregel really had as much influence as the Eldorado contracts seemed to indicate, he might prove to be the key to the whole situation. Such a key could be turned either way. It could be positive, if Pregel had something to offer, if he was really 'the uranium "king,"' as Perrin styled him. Or it could be negative, forcing the United States and the United Kingdom finally to collaborate and to get rid of him. Pregel, however, yielded little. MacDonald reported to Anderson on 17 July that Akers had met Pregel 'the other day and gave him an opening to give information about the oxide position. But he did not take it.'89 This encounter, and perhaps the accumulation of disappointments, were beginning to have an impact on Akers. By now into his second steamy month in Ottawa - the climate was sultry by temperate British standards — Akers began to discern some merit in what the Canadians had been telling him. 'As you know,' he wrote to Perrin on 23 July, 'Mackenzie expressed the view that the President would do nothing if he found that he was up against a firm stand by any of his senior people, especially from the Army.' This, Howe repeated, was 'his actual experience in other cases.' So it was, and so it would be again. Conceding that Mackenzie and Howe might have been right about this point, Akers proceeded to re-examine their other arguments. There was, he wrote, a feeling among the Canadians 'that some quite artificial and non-realisable condition is being forcibly substituted, by the British, for the obvious and natural state of complete cooperation with, and dependence on, the Americans.' British arguments that the American terms were notably one-sided left Howe and Mackenzie 'not at all moved.' There had been, Akers admitted, some problems with personalities. Mackenzie was probably not the ideal man for his job, but it must be remembered that Mackenzie had other responsibilities besides Tube Alloys. It was true that Mackenzie had not always been 'tactful' in his relations with the Montreal laboratory, but he nevertheless had basic good will and was personally likeable. In any case, Akers added, 'Mackenzie, and [Lesslie] Thomson, are our only contacts with the Americans at present, and it is useful, and

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probably wise so long as we hope for restoration of cooperation, to keep this little friendly contact.' As for Howe, he was basically 'an individualist working in an administration which is, at the best of times, a very fine-drawn affair. Consequently, Howe is trying to do, himself, far more than anyone can do.' There was nobody in his department who was strictly concerned with the acquisition of 'control' of Eldorado, 'and still less with what Eldorado does. Howe happened to know LaBine, who is a very competent person in his own field, and so he has left to LaBine pretty nearly all matters, so far as we can make out, in connection with Eldorado and Oxide, although many of these things have really become Government policy matters.' It would have been impossible for Akers not to notice that Howe often spoke off the cuff, and it was not unreasonable for him to draw the conclusion that Howe's 'memory for facts and figures is poor' — 'and yet he tries to carry the whole thing in his head.'30 This was a fair assessment, though overdrawn on some points. Howe frequently gave his assertions a statistical foundation they did not deserve. Right on broad points, he was often wrong on details. In this case, he was right on the underlying question of AngloAmerican co-operation, but sometimes dismally misguided on matters of fact. The American position on their oxide requirements also appeared more understandable, if not more reasonable, when studied up close. The Americans were taking a very broad approach to the uranium question, one that inevitably involved a number of false starts. There might not be time to take a sequential approach, with the result that a great many supplies were needed simultaneously. Akers was painfully surprised when Mackenzie both explained and justified this approach on the grounds that the Americans 'always had plenty of everything.' Needing plenty of oxide, the Americans could then quite legitimately claim that there was none available for experimental purposes, of the kind that the British wished to pursue.31 What the British needed was some means of examining American requirements, and placing them in some continuum with their own. Providentially, while Akers was gloomily contemplating what

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would be needed if co-operation broke down entirely, a solution was emerging in Washington. Sir John Anderson had flown to the enemy capital, and sat down with Bush and Conant. As the British official historian has noted, 'the judicious diplomacy of Anderson and the apparent goodwill of Bush brought the agreement to port.'32 The Americans were concerned about security, and about the possibility of any future commercial exploitation of atomic energy by those who had not, in the first instance, paid the freight. The British formally abjured the latter, and dealt with the former by promoting interchange to such a high level that it could not reasonably be argued that the persons involved were not 'secure,' or that they did not have a broad 'need to know.' A Combined Policy Committee was to be established, at the highest practicable level, to oversee atomic programs, and at that level there would be full interchange of information. At the working level, matters would remain as before, in compartments with the 'need to know' conditions prevailing. In his discussions, Anderson did not omit the Canadians. The Combined Policy Committee would basically be an AngloAmerican organization, but on it, as of right, would sit a Canadian representative. This would reflect the Canadian contribution to the Montreal laboratory and, just possibly, Canada's uranium interest. When Churchill and Roosevelt met at Quebec City in mid-August 1943, the Combined Policy Agreement was placed before them, and on 19 August it was signed. Mackenzie King was immediately informed, and he promptly proposed C.D. Howe as the Canadian representative on the new committee. With the constitution of this committee, which we shall abbreviate to CPC, the worst problems of Anglo-American conflict over atomic matters were resolved. A formal mechanism was established at which policy questions could be fought out, free of the hobgoblins of security and national suspicion. It would now be possible for the higher authorities of each country to know what the others were doing, and possible too for difficulties to be confronted and resolved, instead of being left to fester. With this matter of high policy out of the way, it is pleasant to report that some of the details were also en route to resolution. The

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summer of 1943 witnessed a blossoming of relations across the border. In July, General Groves himself came to Ottawa, and held a friendly chat with C.D. Howe. Nothing was finally resolved as a result, but each came away with a better appreciation of the attitude and concerns of the other. This was especially important in General Groves's case, for while C.D. Howe, a native of New England, understood where and even how the general had to work, Groves's previous acquaintance with Canada and Canadian priorities was slight. Lesslie Thomson, Howe's and Mackenzie's liaison with the Montreal project, also played a part in establishing better contacts. Akers, in mid-July, singled him out as one of those who had kept up his contacts south of the border. 'His technique,' Akers wrote, 'now is to explain to the American Colonels, with whom he deals, that Canada has let down very badly the British Government, so that it is up to the Americans, as "good North Americans" to help the Canadians to put things right. I believe,' Akers concluded, 'that this works, and that he will get us our 100 Tons for 1944.'33 He did. The great war over Eldorado's oxide was over. The British secured sufficient oxide to carry on their experimental work at the Montreal laboratory. The Americans found that they could spare quantities of uranium and still have enough, as Manhattan District documents from early 1944 demonstrate. Eldorado found some relief from the pressures that had been confronting it since the fall of 1942. C.D. Howe was spared further confrontations with the British, at any rate until after the war. He was not spared the knowledge that part of his industrial system had not worked as it should have. He had tried to run Eldorado on a long leash, and had found that the company had piled up political trouble for him, trouble that was not alleviated by his own inadequate knowledge of what was happening. Gilbert LaBine had not proved to be a good interlocutor. Unused to reporting to any authority higher than himself, LaBine had not favoured Howe with the details of his operations, and perhaps could not judge when something passed from the realm of administration to that of policy - high policy at that. Very slowly, Howe was turning to a policy of stricter supervision of Eldorado and its commercial doings. Eldorado remained, in its

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outward appearance, a private company. LaBine was still buying up stock. This charade was designed to enhance security, and up to a point it did. But the game had its dangerous aspect as well, and during 1943 Howe came to question whether secrecy, absolute and total, was really the best strategy for directing a crown company in the uranium business. IV

The crisis of 1943 had the direct effect of placing Lesslie Thomson in a critical role in Eldorado's affairs. Thomson, a middle-aged Montrealer, was the secretary of the Department of Munitions and Supply, a demanding position, but not one to tax the imagination. Imagination was perhaps not Thomson's foremost quality; doggedness, devotion to detail, and a high sense of public responsibility were his strong points. Old-fashioned to the point of absurdity (his roommates in crowded wartime hotels noted with amazement that he still wore a nightshirt in an age of pyjamas and knelt at his bedside to say his prayers), he was distinguished by an equally old-fashioned loyalty. 'He is not exceptionally bright,' Akers wrote, 'but he is absolutely honest and seems to know everybody.' It helped that Thomson had been around since the start of the war, because he knew, inside and out, the complicated priority relations that determined who could get what, and in which order. At Montreal, Akers wrote, 'he drives them nearly frantic sometimes,' demanding 'a string of memoranda to justify the expenditure of a few dollars.' But he also 'fitted out for them one of the finest laboratory workshops I have ever seen simply on a list of useful tools' the scientists had scribbled down.'34 The appearance of Thomson therefore promised well for Eldorado, if the company's problems were really a matter of communication, of inside knowledge, or of familiarity with government procedures. If, on the other hand, there were other, deeper difficulties, then eventually, and very slowly, Thomson would bring them to light. The first problem that arose, however, had nothing directly to do with Eldorado. On 15 June 1943 the Manhattan Engineering District formally established 'The Murray Hill Area,' under Major

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Paul Guarin, to explore and then develop uranium-bearing deposits wherever they could find them. The actual organization of the exploration program pre-dated the actual appearance of the Murray Hill Area; it took shape on 11 May when the Corps of Engineers signed a contract with a subsidiary of Union Carbide, the Union Mines Development Corporation (UMDC) of New York City. Over the next two years, the UMDC would explore for uranium in 'more than twenty foreign countries and in thirty-six states'; among those countries favoured by its attentions was Canada.35 The UMDC in its turn made a contract with Ventures Limited, a reputable Toronto-based mining development firm, which had also the coincidental advantage of long-term experience (back to 1930) in the uranium district of the Northwest Territories. During the summer of 1943, Ventures registered claims in the Great Bear Lake area, on behalf of the UMDC for the United States Army. But Ventures were not alone in the Territories, or in the business of finding uranium. As might be expected, Boris Pregel was there, too. Pregel had a company, International Uranium, and he had some claims. It could reasonably be inferred that he was establishing an independent position in the uranium field, though it is also true that neither his claims nor those by Ventures ever proved to have economic deposits of uranium. That was not known at the time, however, and Pregel could properly claim to be a man with prospects. Pregel probably made no great secret of his claims, since his activities swiftly came to the attention of the British government, which in late May 1943 told Howe that 'Pregel is prospecting for radium ore in the Great Bear Lake area, with some success.' Repeating this information to LaBine, Howe pointed out that one of Pregel's objects — should the information prove true — would be to 'start an operation in competition with yours.' Howe could scarcely credit the news, but added that if it was accurate, 'the Government must intervene as we can have only one company in the radium business.' To Howe's surprise, LaBine admitted that his information was true. Of course he knew about it because Pregel had told him about it. The International Uranium Mining Company had claims about eight miles from LaBine Point, and in mid-1942 Pregel had taken

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an interest in them. LaBine, asked his opinion, had given it, telling Pregel that there might be some silver, but that any uranium present would not be in commercial quantities. Still, there might be something interesting, and Pregel should be allowed to spend his own money to find it, since 'when the ore is found, government machinery can take care of it.' LaBine's own information from Great Bear Lake was that little had been done, and that little was planned.36 Howe's immediate response to this has been lost, but his attitude is plain from a later letter, dated 12 June: 'I hope that Mr. Pregel can be taken out of the mining field in Canada. As you suggest,' Howe added, 'we must keep this as an Eldorado monopoly.' In the interim, nothing much was done, until events precipitated further attention, and then action.37 Activity by International Uranium and by Ventures did not go unremarked in Toronto, where a number of stock brokers took a close, if not always well-informed, interest in mining developments. Eldorado's stock started the year at just under 80 cents, and in the latter part of January moved up to just $1.10. This stimulated curiosity among the u.s. Corps of Engineers, though not, apparently, in the Canadian government. In May, Major Merritt, who was handling some of Eldorado's metallurgical problems, reported to Manhattan headquarters that Pochon had told him that 'the rise... was the result of a promotional scheme headed by LaBine to run the stock up. This/ the American report continued, 'has not been substantiated.' After several rises and dips, in July the stock again passed $1.00, then $1.10, and then $1.20. In the second week of August it rocketed up to $1.60. This activity coincided with repeated conferences between the Corps of Engineers and personnel from Ventures; and the coincidence was too striking to go uninvestigated, especially since there was yet another coincidence. This took the form of similar articles appearing in both the Toronto Globe and Mail and the Toronto Telegram, stating that an American government agency had interested itself in Eldorado in order to seek closer control of uranium for war purposes, 'on a basis that would give stockholders an immediate return of cash and royalty interest in future production.' Boris Pregel contributed his

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mite when he told Major Merritt that 'most of the employees of Ventures were purchasing stock in Eldorado.' Worse, the Ventures employees also told Pregel that the u.s. Corps of Engineers were 'building a plant in Tennessee' — Oak Ridge. Pregel also knew, as of the end of July, that Ventures was moving into the Northwest Territories. Investigation showed that the rumour mills were grinding out optimism. One broker, reputed to be active in Eldorado stock, told investigators in early August that Eldorado had just signed 'a lease with the Canadian Government for a period of ten years at a price which will enable the company to pay a dividend of twenty-five cents per share.' Once the news got out, the broker claimed, 'a rise of stock to $2.50 would be warranted.' This was, of course, nonsense, but it and similar stories had the effect of drawing attention to Eldorado and to its uranium-mining activities.38 The publicity gave pause, but it was the appearance and re-appearance of Boris Pregel that truly caused concern. By July 1943 it was plain that the British had had enough of Pregel indeed more than plain, since they had been making an issue of him since October 1942. C.D. Howe was perturbed by Pregel's free-wheeling activities in the uranium field. And now it was the turn of the Americans to weigh in. On 26 July 1943, General Groves, having called up Howe on the phone, arrived with his assistant, Colonel Nichols, in tow. For two hours Howe, Mackenzie, Groves, and Nichols thrashed out the major problems of atomic policy; the first subject on the agenda was Boris Pregel. 'Groves,' Mackenzie wrote in his diary, 'would like to get Pregel out of the picture and would like a direct contract between the u.s. Army and the Department of Munitions and Supply.' Howe responded by saying that 'he would take over the existing companies.' Mackenzie, he told the Americans, would handle it, and 'he would concur officially in my decisions,' as Mackenzie put it.39 It was not Mackenzie but Thomson who now came to the fore. Shortly after Groves's visit to Howe, Thomson learned about the Ventures project in the Territories. Thomson passed on the news to Howe, and Howe acted very quickly indeed. On 15 September 1943, the government passed an order-in-council based on the Quartz Mining Regulations of 1932, reserving to the crown

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'all radioactive substances' found in the Northwest Territories, whether in existing or future leases, grants, or claims. A similar regulation was applied to the Yukon.40 The regulations affected two principal parties: Boris Pregel and his International Uranium Mining Company, and Ventures Limited and its backers, the u.s. Army. Pregel, as might be expected, was indignant, and called on General Groves in an attempt to enlist his influence. General Groves politely received Pregel, and directed him to a table with a phone placed conveniently in the middle. The phone connected to a recorder outside, a device which was probably similar to the recording machines that sat above Pregel's office in the Rockefeller Center, churning out noise for Groves's intelligence officers to mull over. What he was doing, Pregel told Groves, was entirely in the public interest of the United States. He wished to set up an independent American uranium industry, with a large refinery. To assist, Pregel proposed, 'after the war the entrance of radio-active materials to the United States will be prohibited - or a very high tariff - and [raw] ore will enter without any tariff and will be refined in the United States.' He had personnel, facilities, and, it seemed, mining claims. These 'possessions in Canada,' Pregel went on, T offered and re-offered it to you today.' The only thing that stood in the way was what he called 'the order of the...council.' That order was 'anticonstitutional.' When interviewed by a Canadian official (possibly LaBine), Pregel went on, T told them, what have you paid for this order? Until now, nobody was interested in radio-active material and everybody worked there and now you won't have anybody, and now what is the result. Everybody knows you are interested in radio-active material - everyone - and that is against the policy of the United States.' Shortly afterward Groves brought the interview to a close.41 On the matter directly at stake, Groves offered no opinion because he had already conceded that the Canadians were, in principle, right. 'We recognized we'd made a mistake,' Colonel (later General) Nichols recalled in 1981, 'that we should not have been in Canada surveying.' Inevitably, bureaucratic procedures consumed some time, but in the end the claims were transferred.42 The orders-in-council of September 1943 took the Canadian

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government a giant step towards full control of the uranium industry. Only one step remained: public nationalization of the industry. On 28 January 1944 Howe rose in the House of Commons to make a brief announcement. Eldorado Mining and Refining Limited (the company's name since 1943) had become a crown company. Shareholders would be reimbursed for their holdings at the rate of $1.35 a share. 'In the interests of military secrecy,' Howe added, he hoped that there would be no embarrassing questions, and there were none. The expropriation was effected by PC 535 and occurred at 3 pm as the stock exchange closed for the day. The final market price for Eldorado shares was fli.sji.43 There is nothing in Howe's papers that indicates why he chose the 28th of January as an appropriate day on which to act. His action was known to a few officials, and, of course, to LaBine and Eldorado's directors, who were asked to stay on. Action seems to have been decided upon sometime before 18 January, when Mackenzie lunched with LaBine and learned that 'the Government now has the controlling interest in shares and will take over the rest in the near future.' Howe evidently did not consult Mackenzie, nor did he see any necessity to notify the other members of the Combined Policy Committee. In a general way, they had been in agreement since 1942 on the desirability of getting 'control' over Eldorado, and if this was the only way to do it, they would doubtless approve. As far as can be inferred from an absence of comment, the Americans saw nothing untoward in Howe's announcement, which they may have thought less damaging than the speculation that had already appeared in an unfettered press. Sir John Anderson, needless to say, was disturbed, and cabled his pained surprise to Malcolm MacDonald. Howe replied stiffly, calling Anderson's attention to certain procedural failures of the Combined Policy Committee, such as their apparent inability to give him formal notice of their meetings. MacDonald supplied an explanation of sorts, telling Anderson that Howe had been having trouble getting 'a controlling number of the shares of the Company. The price had begun to rise a bit and he was afraid of speculation which would be unfortunate and damaging.'

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'Extraordinary,' minuted Anderson.44 Extraordinary or not, the vexed issue of the formal control of Eldorado was now resolved for all to see. Eldorado's connections had proved too complicated, and too resistant to pressure, for Howe to resolve in any other way. Ultimately secrecy had spawned a wealth of rumours, some of which had come perilously close to the truth. Some rumours could not be squelched without calling further attention to their focus. But publicity was only one reason, and probably not the most important, for the public nationalization of the company. Eldorado's Pregel link, and Pregel's own selfinterested activities, impinged once too often on what Howe thought uranium policy should be. It was obvious to Howe, if not to LaBine, that Pregel was playing his own game, and that Pregel's interests were far from coincident with those of Eldorado or Canada. Fortunately for Howe, the Americans had reached the same conclusion, and could be counted on to support any move to bring Canada's wild uranium card back into order. V

It was left to Lesslie Thomson to clean up the rest of the company's activities. This he did with surprising speed. In September 1943, at a meeting in Toronto with LaBine and Eldorado's secretarytreasurer and ranking officers from the Manhattan Project, he correlated all available information on Eldorado's existing contracts. From this he derived a schedule of refinery production, indicating when the refinery would be processing Belgian ores, and when it would be handling Canadian. The meeting agreed that for some purposes Pregel would be excluded from the contracts, and undertook to notify him to that effect.45 The 7oo-ton contract was replaced by another directly between Eldorado and the u.s. Army, dated 11 September 1943. This contract would be half completed by the following June. Next, on 25 October, there was a contract covering the refining of a variable amount of material, from which Eldorado was to extract radium and uranium. Finally, on 15 January 1944, Eldorado and the

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Americans signed a contract to refine further Belgian concentrates averaging between 25% and 50% U3O8.46 With Eldorado's obligations established, Thomson turned to Eldorado's income. Strangely enough, given all its activities since 1942, the company seemed to be subsisting on bank loans. This was in spite of the assumption that Eldorado was operating on a 'no-profit, no-loss' basis (or, more accurately, low-profit, no-loss) in its dealings with the Americans. Nor were Pregel's relations with Eldorado easy to sort out. His agency contract ran until 1947, and though he could be excluded from war contracts it was impossible to deny that he still had some claim on Eldorado's business. Once more, Pregel was the occasion for a further, closer, and inevitably depressing scrutiny of Eldorado's business. Probably at the instance of the Manhattan District, Canada's Foreign Exchange Control Board began to investigate Pregel's transfers of funds. That investigation turned up increasingly interesting evidence during 1944, but delayed drawing conclusions or recommending action. Meanwhile, Lesslie Thomson was tackling the unenviable task of renegotiating Pregel's sales agreement in the face of the latter's growing suspicions that Thomson's real purpose was to terminate his uranium connection altogether. Thomson was not initially as suspicious of Pregel as Pregel was of him. It was not until September 1944 that Frank Brown, Howe's financial adviser, gave Thomson 'certain information' from Howe that might have a bearing on his contract renegotiations. Eighteen months later, in early 1946, Thomson wrote that 'it is difficult now to determine when I first became uneasy... but by the middle and later part of 1944 I was definitely sure that things were not right in the Eldorado Company.' Identifying Pregel with his sense of unease, Thomson began to turn up evidence of his 'companies, interlocking directors and directorates, and the like.'47 Pregel conceded nothing without a struggle. If Thomson wanted him out, he would have to pay him a salary of $15,000 a month for the remaining four years of his contract ($720,000), in return for which Pregel would waive his claim to $200,000 in commissions. John MacAulay and R.L. Birks, the legal members of the Eldorado board, told Thomson that Pregel was 'on reasonably solid ground'

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though obviously his salary claim was a negotiating position. As for the alternative of simply annulling Pregel's contract under the War Measures Act, that would permit a claim for damages to be lodged in the Exchequer Court of Canada.48 R.L. Birks did not take that prospect very seriously, since in his view Pregel would not be 'anxious to have the various personalities associated with his numerous companies investigated too closely.' As for the question of who those personalities might be, the Americans were obligingly supplying a considerable amount of information. On 24 November, CJ. Mackenzie recorded in his diary that there had been 'information from General Groves regarding association of Pauchon, manager, Eldorado refinery at Port Hope and Pregel,' leading to the conclusion that Pochon was 'on Pregel's payroll.' 'The American secret service,' Mackenzie wrote admiringly, 'are really very good. They really do tap wires and have microphones all around people's offices, which of course they can't [legally] do.'49 Matters were beginning to come together. In January 1945, Eldorado's secretary-treasurer suddenly resigned. In March, the Foreign Exchange Control Board began formal hearings on Pregel's financial dealings. These hearings proved inconclusive, and so in May, Howe set up a departmental investigation and appointed J. Grant Glassco, a prominent Toronto accountant, to conduct it. Glassco began hearings in Toronto in July, but those too were inconclusive. The end of the war was at hand, and with it the end of the government's power to hold investigations like Glassco's. The sequel is best told in Glassco's own words: 1 On 2 ist December 1945 Mr. French [secretary-treasurer] was arrested and charged under the Criminal Code with omitting to make proper entries in the books of Eldorado with intent to defraud and with accepting secret commissions. 2 On igth February 1946 warrants were issued against Messrs. Pregel, French and Pochon on a charge of conspiracy to defraud Eldorado, but Pregel refused to come to Canada to answer such charges. 3 A civil action was taken in the Supreme Court of the State of New York by Eldorado against Messrs. Pregel and French and Canadian

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Radium and Uranium Corporation and International Rare Metals Refinery Inc., charging fraud and claiming damages and other remedies. The civil suit asked for damages in the amount of $2,663,362. The defendants countersued and demanded $1,171,078 for alleged fraudulent acts on the part of Eldorado.50 The charges, civil and criminal, created a considerable sensation. 'Bomb over Eldorado,' Newsweek headlined. 'French never took a cent from anyone,' Pregel told the press. The charges against him were 'political and malicious.' The Canadian government stoutly defended its actions, and in the meantime Eldorado sat and waited, still legally bound by the Pregel contract of 1940, and financially hamstrung by its apparent losses since 1Q42.51 It would be pointless to rehearse here all the courtroom drama and legal manoeuvring that occupied 1946. In the end, plaintiff and defendants judged it best to settle out of court. The criminal charges were dropped, and a financial settlement was made of the civil ones. The defendants, Pregel et al., handed over $576,000 in cash and $537,044.48 in kind. Pregel also agreed to the termination of the agency agreement between Pregel, Canadian Radium and Uranium Corporaion, and Eldorado. The agreement took effect in March 1947, and payments were spread over a number of years.52

VI The termination of the Pregel agreement was the end of an era. Eldorado was finally free of the attentions of a man who, in one way or another, had shaped its history as a competitor, as an agent, and as an ally since the early 19305. No one could deny that Pregel was a man of unusual talents. In the midst of the most secret military project of the greatest war in history, he had balanced among, and then fended off, the authorities of three countries. His object, as the British surmised, was to make himself the 'uranium king' - of the United States, of Canada, of wherever else he could find space to operate. Pregel's efforts were finally counter-productive. He was fore-

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stalled by the British decision to ask Howe to bring Eldorado under control — a thing easier ordered than accomplished. His attempts to establish an independent uranium position in 1943 led directly to American intervention with Howe, to Canada's prohibition of private uranium claims, and finally to the public nationalization of Eldorado in January 1944. It led, indirectly, to an intensive investigation of Pregel's own affairs, and to the Government of Canada's later civil and criminal cases against Pregel and his alleged associates. The ultimate victim in all this was Eldorado. 'It is far worse than anyone dreamed,' C J. Mackenzie told his diary in August 1945. 'It amazes me how a company directorate with lots of big names on it can be so unbusinesslike. If any scientific organization did the same thing it would be howled out of court.' Howe was more charitable than Mackenzie, and perhaps more realistic. Apart from French and Pochon, no one on Eldorado's board resigned. It was obvious that the board had been kept in the dark, and that directors' questions could be, and were, met with the response, 'secret.'53 Howe commissioned two reports on Eldorado, but before they were complete he had decided to act. It was plain to Howe that Eldorado's management had been lax at best. As a result, Howe and Canada had been plunged into an international embarrassment with Britain and the United States over uranium deliveries, and then into a notorious criminal investigation. It would be best for all concerned, Howe concluded, if management were changed.

On 28 July 1931, this group watched this craft set out from LaBine Point on Great Bear Lake, NWT carrying eight tons of precious ore, the first radium-concentrate shipment from the new discovery (PAC, 0-23960).

Radium City on the rim of the Arctic in Canada's Northwest Territories. From this subarctic community comes a large percentage of the world's new radium, as well as tons of uranium and thousands of ounces of silver and copper for ballast. In the foreground are the older buildings of logs. At left, the bunkhouse with steam heat, electric lights, hot and cold running water. In the background is the mill and power plant with storage tanks for fuel oil from the Arctic wells at Fort Norman. The radium industry is diesel driven (PAC, 0-23966).

Gilbert LaBine, Marcel Pochon, and Charles LaBine at 1r i d e a u ; ; i Hall, 1936 (courtesy, Hugh S. Spence)

Gilbert LaBine at Port Radium, circa 1935 (courtesy, Eldorado Resources Limited)

Drilling with Leyner drill, Port Radium, mid-19305 (courtesy, Eldorado Resources Limited)

Hand-cobbing in the mill, Port Radium, mid-19305 (courtesy, Eldorado Resources Limited)

Entrance to adit level, Port Radium, circa 19305 (PAC, 0-23967)

OPPOSITE top Hand-trimming in the mine, mid-19305 (courtesy, Eldorado Resources Limited) A steam coil on which the concentrated ore, now 70% pitchblende, is dried (PAC, 0-24019)

Refining radium at Port Hope, 19305 (PAC, 0-24041, 0-24031, 0-24034)

Franz Kainz, who treats diesel engines as if they were favourite children and likes the complete absence of politics in the Arctic, emigrated from Germany and now presides over Eldorado's power plant on Great Bear Lake. Tiny Peet, at right, is an electrician who likes a job where he can work till midnight, then go fishing in the subarctic semi-daylight (courtesy, Eldorado Resources Limited).

Miners at home. The curtains are not company issue but privately owned. They were made by the blacksmith. Tiny Peet at left uses an electric razor. At right is one of the old residents who gives his full name as Olaf. He paddled in 1500 miles by canoe looking for work when there was none in the outside world. His hobby is making models of airplanes, elaborate ashtrays, and tiny figures out of discarded piston rings from diesel motors (courtesy, Eldorado Resources Limited).

Hard-rock miner replenishing his store of amenities from the canteen in the recreation building at Port Radium, late 19305 (courtesy, Eldorado Resources Limited)

The cookery at Port Radium (courtesy, Eldorado Resources Limited)

Eldorado refinery viewed from Port Hope harbour, mid-19308 (courtesy, Eldorado Resources Limited)

Interlude

War into ColdWar

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ON 6 AUGUST 1945, an American 6-29 bomber, the Enola Gay, dropped an atomic bomb on the city of Hiroshima, Japan. Three days later, on 9 August, another bomb was dropped on the city of Nagasaki. Perhaps 100,000 people were killed in the first raid; 39,000 in the second. On 10 August, the Japanese government resolved to surrender, and on 2 September, in Tokyo harbour, a mixed allied delegation accepted the Japanese capitulation. The news of the Hiroshima attack reached Ottawa just before noon on 6 August. The Canadian government was preoccupied that day with a dominion/provincial conference intended to settle the nation's jurisdictional balance for the post-war period, and so C.D. Howe, who was attending the conference, got word in a note from Malcolm MacDonald, the British high commissioner. 'The thing has gone off,' MacDonald wrote. Howe was ready for the occasion. As a member of the Combined Policy Committee, he knew that a test bomb had been detonated some weeks before, and that it was intended to use the bomb to bring the Japanese war to an end. As minister responsible for Canada's part of the allied atomic project, Howe and his lieutenant, CJ. Mackenzie, had drafted a statement to be released on the occasion; after checking the authenticity of MacDonald's information, Howe released the statement.1 The news, in its various forms, spread across the country. The Regina Leader-Post, in a later time zone, made room for the atomic bomb under the title 'HAVOC! The Toronto Star, the next day, told its readers that 'we have won the battle of the laboratories.' It quoted Howe's statement, in which the minister said that 'it is a particular pleasure for me to announce that Canadian scientists have played an intimate part, and have been associated in an effective way with this great scientific development.' Professor E.F. Burton, of the University of Toronto's physics department, echoe Howe's sentiments, though with more daring and in more detail. 'Within 25 years,' Burton opined, 'this will probably be our source of all energy... We'll probably be working only three days a week, six hours a day.' Eldorado was not forgotten. 'LaBine, St. Paul Drag Sled to Powerhouse of World,' the Star headlined on page 11, retailing a somewhat romanticized version of the events of 1930 - which it placed in 1937. Inevitably the story of Eldorado's nationalization

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was brought up. The censor had killed an article on the subject in 1944, the Star's W.R. Plewman wrote on 7 August. 'The writer had a little of the stock,' he admitted, 'and for other and better reasons was inclined to question that the country in seizing a property of such tremendous value had dealt fairly with shareholders who had held the stock for years and had received no return.' But aside from the question of price, Plewman agreed with what the government had done. 'The Canadian government and the Allied nations as a whole could not allow mineral deposits with such potentialities for good and evil to remain in private hands... Perhaps all uranium deposits everywhere should be nationalized or placed in the control of the world's peace organization.'2 As if to support Plewman's contention that the Eldorado stock had great value, the price of uranium shares - that is, the shares of companies that happened to have 'uranium' in their titles - leaped on the Toronto Stock Exchange, only to fall back when it became evident that their only claim to radioactivity was verbal. Plewman's other idea, that uranium everywhere should be nationalized, had occurred to others. Uranium was now the most sensitive, strategic commodity in the world. And it was a commodity on which interested eyes were cast. The New York Daily News was the most forthright. It was obvious, the newspaper wrote on 7 August, that the United States must have uranium and plenty of it. As a starter, Canada should make its uranium exclusively available to the United States, and if it did not do so, then it should simply be seized. Others were more subtle, although they did not need to be as far as uranium was concerned. During the war, the Soviet Union had secured Canadian uranium from the United States as part of an American aid program. And although the USSR maintained a lively interest in what was going on in Canada's atomic laboratories, its interest appears to have been confined to the scientific and industrial side of the war effort, and not to the mere mining of uranium. Thus, when a Soviet spy ring was uncovered in Canada in September 1945, Eldorado's main interest was to keep the Pregel scandal from being confused with the activities of other Russian-born agents.3 The fact that there was a Canadian spy ring, and that it aimed at the secrets of the atomic bomb project, did not become publicly

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known until March 1946. But it was almost instantly known in Ottawa, London, and Washington and it gave several people pause. Was there really an atomic secret to steal? If there was, should it be shared? If there was not, could it be restricted, for example by controlling supplies of radioactive ores? These questions were not unique to any one country. Because of the secrecy that had veiled the atomic projects, however, they all had to be asked, and answered very quickly, with little or no opportunity for the politicians and diplomats to catch up with what was, after all, one of the most profound changes in technology to take place in the twentieth century. In the United States, the man who had to answer for his country was Harry Truman, an accidental president, who had succeeded to the job on Roosevelt's death in April 1945. Truman, prior to that, had known nothing about the atomic bomb. In Great Britain, the responsibility fell on Clement Attlee, that country's new Labour prime minister, who took office at the end of July 1945, just before the Hiroshima explosion. At Attlee's side, however, there lingered Sir John Anderson; at Truman's, there was still General Groves. Alone of the three powers Canada had not had a change of government. Mackenzie King was still prime minister; C.D. Howe was minister of Munitions and Supply until December and minister of Reconstruction and Supply thereafter. The Liberals had just been re-elected and despite a slim majority in Parliament would stay in power for another twelve years. 'How strange it is,' King wrote in his diary on 11 October, 'that I should find myself at the very centre of this problem, through Canada possessing uranium, having contributed to the production of the bomb, being recognized as one of the three countries to hold most of the secrets...' King's faith that there were secrets was strengthened by the fact that the Russians had tried to steal them. But then there were secrets and secrets.4 King's immediate subordinates were enrolling for a crash course in nuclear knowledge as the prime minister was writing. Those most immediately concerned were the Clerk of the Privy Council and cabinet secretary, Arnold Heeney; the under secretary of state for external affairs, Norman Robertson; the associate under secretary, Hume Wrong; and the Canadian ambassador to Wash-

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ington, Lester B. (Mike) Pearson. These men represented very different interests from Howe's, and ones that, to some degree, rivalled them. For King's men, the emergence of atomic weaponry represented a political issue of the first order. Atomic bombs might have the effect of transforming warfare. Developed in quantity, they might well make the next war the last one, and that in turn would make their control a matter of paramount importance. Controlling the atom would, therefore, occupy a very high place on any post-war agenda, but it was not an agenda they trusted Howe to set. In the view of External Affairs, Howe was most likely to act on an ad hoc basis. Believing that most issues were susceptible to specific 'problem-solving,' Howe had kept broad political considerations out of wartime production relations with the United States. Dealing with the Americans on an issue-by-issue basis, reasoning with them according to need, as well as to Canada's independent and independently financed atomic research, Howe believed that he had done very well. When he learned, in mid-August, that General Groves considered 'that the u.s. and Canadian partnership is much more important to the u.s. than the u.s.—U.K. partnership,' Howe responded that Groves was 'right.' He was, he added, 'glad to know that Groves expects the u.s. and Canadian partnership to continue.'5 Other Canadians were not so sure. Before embarking on an opinion, Wrong and his colleagues quizzed C.J. Mackenzie on the meaning of atomic energy. Wrong's questions, and Mackenzie's answers, mark a principal point of departure for Canada's postwar atomic policy, and they started with a question about raw materials. Wrong asked: Just how important was Canada? Not as important as some believed, Mackenzie replied. The Manhattan Project was 'not entirely dependent on Canadian ore' and a bomb might have been managed entirely 'without our material.' Nevertheless, uranium was scarce, and Canada's uranium had probably gained in importance because of the scarcity. Wrong then asked, 'Is it likely that denial (a) of raw materials now controlled by the U.K., U.S., and Canada; (b) of the "secret" of the manufacture of plutonium or (c) of information on the construction of the bomb itself would long prevent its production in other countries?' This

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was the crux of the matter. Was the atomic bomb either theoretically or practically a monopoly of those countries that already knew how to build it? No, said Mackenzie. A raw material monopoly was not possible, in response to point a, at any rate not for very long. And 'the same answer' could be rendered to the other two questions.6 Not everyone agreed with Mackenzie, as we shall see. The confusion that resulted would be crucially important to the post-war development of uranium policy. For the moment, we should regard Mackenzie's opinions as useful, but not universal. They, and the Canadian policies based on them, would be tested at the first post-war atomic conference, which Truman summoned to Washington for early November 1945. In preparation for the conference, Lester Pearson prepared a memorandum on atomic weapons. Reflecting the opinions of Wrong and Heeney (and possibly Robertson), Pearson started off by assuming that the atomic 'secret' was hardly a secret at all, and that within five years it would be shared by the Russians, whether the Western atomic partners wanted it or not. That being so, the atomic partners were faced with two alternatives: an arms race, or some form of international control. Such control could be bargained for, using the temporary monopoly of the techniques of atomic bombmaking, and under the auspices of the United Nations. Thereafter, any atomic weapons would be consigned to the United Nations, or destroyed. A system of supervision and inspection would enforce this atomic regime.7 The decision on what to do would lie with the Americans and the British, the senior partners. Yet, strange as it may seem, neither of them had made detailed preparations for the forthcoming conference. When Truman, Attlee, and Mackenzie King met on 10 November, no one seemed particularly clear on what they intended to accomplish. The confusion was enhanced by the haphazard way in which statements were drafted, referred, and re-hashed, sometimes by persons not present at the talks. From the Canadian standpoint, matters were also not helped by simultaneous and inevitably acerbic disagreements with Sir John Anderson concerning the state of co-operation in Canada's joint nuclear program with the British. After a frantic last-minute scramble, Truman

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presented the result to a press conference on 15 November. The three atomic powers, it appeared, were warily willing to co-operate. They would share basic scientific information. They would consider doing more, especially for peaceful purposes, but first they wanted 'effective, reciprocal and enforceable safeguards.' To devise these, they proposed a United Nations commission be set up, and 'to proceed with the utmost despatch.' So much for the conference's surface agenda. There was another agenda too, less public, but equally important to the conferees. What would the future hold for atomic co-operation among the British, the Americans, and the Canadians? The British, who had taken a back seat, were determined to extract concessions in the form of information from the Americans. The Americans were equally determined to avoid giving information, especially if it could result in the British building a bomb of their own. The Canadians were concerned, some of them, to get the British to co-operate with them and to make no concessions that could compromise the independence and profitability of Canada's atomic assets, including Eldorado. Only the Americans had much cause for satisfaction, though even there it was mixed with uncertainty over exactly what had been agreed to. Anderson and Groves sat down together to thrash out the detailed issues of co-operation, and produced a paper that, in terms of its practical effects, would have more important and long-lasting consequences than the public communique signed by the three heads of government. The 'Anderson-Groves Memorandum' bound the three powers to continued co-operation and continued common secrecy. Britain, the United States, and Canada also promised not to 'use atomic weapons against other parties without prior consultation with each other.' They agreed to exert every effort to find, exploit, and pool uranium and other radioactive substances, and to place them at the disposition of the Combined Development Trust, which would then allocate them as required. Both the trust and the Combined Policy Committee were to continue, and to act on an ad hoc basis as and when occasion demanded. Except on raw materials and on the question of using atomic weapons, the draft was vague, leading CJ. Mackenzie to observe that 'as far as Canada was concerned, it was a

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one-sided bargain that gave all our uranium away and did not provide much assurance of co-operation for our laboratories. It seemed to me that the only thing the British gave was what belonged to Canada and I said I doubted very much that the Minister [Howe] would approve.' He did not, but thereby hangs another tale8 (see below, p. 169). What the Washington conference set in motion would govern Canadian atomic policy for the next year, and in some cases for very much longer. Most immediately important, it situated atomic energy in the realm of high political policy. There would be a United Nations commission, and it would seek to control atomic energy for the whole world. The future of Canada's atomic program was therefore in some senses in suspense, until the international commission could meet and reach such conclusions as it would. For the purposes of the commission, Canadian policy would be decided, not by Howe alone, but by the prime minister, and the prime minister's immediate advisers. The United Nations Atomic Energy Commission was not the only issue of the conference. At the same time as they pointed optimistically at a future of collaboration, the conferees agreed among themselves to go on pretty much as they had. For the British, it was as before, accepting half a loaf as better than none. For the Americans, it was an admission that for some purposes, co-operation with the British was better than an open break. For the Canadians, there was the unsurprising discovery that left to themselves, Canada's senior atomic partners would divide the atomic pie without reference to what Canadians might wish or think. For the moment, the future of Canada's atomic projects lay with the United Nations. But if the United Nations failed, the machinery was already in place to supersede it.

5 The Shadow of War

Eldorado's fate hung in the balance for eighteen months at the end of World War n. The company had two principal orders of business: it had to be straightened out so that some accurate assessment of its profits and losses, assets and liabilities was possible. And it had to complete its wartime contracts with the Americans, which stretched through 1945 and well into 1946. Beyond that, the future was obscure. It was entirely possible that Eldorado would finally earn a certificate of corporate good health in time to be wound up: abolished, or sold back to private interests to make what they could of it. Or, just possibly, it would become part of a world political settlement designed to bring the atomic bomb under international control. This last was, in the collective mind of the Canadian government, its most important potential use. Yet the chances of a true internationalization of Eldorado were never great, and to discover why this was so, we must make a brief detour to look at international politics in 1945. The world certainly looked different from what it had been in 1939. Germany and Japan, the principal enemy powers, had been wiped off the political map. Both countries were occupied by their conquerors; neither could make any sovereign decisions without the consent of whatever allied general was responsible for their administration. Economically, the former Axis powers were prostrate, and dependent on the allies for food and basic supplies. This

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in turn placed a heavy burden on some of the allies. The Soviet Union emerged devastated by the war, with heavy losses of population and resources. It would take years to reconstruct. Western Europe was drained of wealth by the war, though physically it had survived rather better than eastern and central Europe. Great Britain, in particular, had suffered from the economic effects of war; in 1945-6 only the hope of American and Canadian loans kept its international trade functioning. The rulers of Soviet Russia were not particularly surprised by these developments. Marx and Lenin had predicted the great economic crisis of capitalism, and now it was at hand. Time, science, and the future were all on their side, and the future could not be very far off. In the short term, capitalists were not to be trusted, and it was certain that no very profound community of interest existed between the Soviet Union and its erstwhile allies. It was not necessary to humour the West beyond a certain point, and that point could be defined by the growing military weakness of the Western powers. For with the end of the war, public opinion in Britain and the United States (not to mention Canada) forced the quick demobilization of their armies. Although the Soviet Union demobilized, it did not have to pay as much heed to public longings for the return of the soldiers, and in consequence, a large — a very large - Russian army of occupation remained in eastern Europe. The existence of this army, coupled with a cynical manipulation of local politics to produce pro-Soviet regimes, made Western military and political leaders nervous. To calm their nerves, certain Western politicians placed their hopes in the miracle weapon, the atomic bomb, the great 'secret' that the United States still held. The further away from real power or knowledge, the more prone were politicians to clutch at the bomb, and to assume that the sheer fact of possession of the atomic 'secret' would compensate for starving other kinds of military expenditure and for the fact that the soldiers who were left were too busy reorganizing to be a significant military factor. Nor was allied diplomacy well co-ordinated or even coherent. Too often the Truman administration sent contradictory signals with the result, as an east European diplomat remarked, that 'Russia has taken good measure of the West and knows that continued pressure will get

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her most of what she wishes without any serious risks.'1 The take-over of eastern Europe therefore continued. The intransigent style of Soviet diplomacy aroused both resentment and fear in Washington and London, and it fostered a climate of opinion which held that only a policy of no concessions would keep the Russians at bay. If the Russians were ready to take advantage of every opening, of every weakness, then Western policy must not be weak; above all, it must not leave anything to chance in assessing the prospects of Soviet behaviour. Although policy-makers in Washington were anything but certain of their ultimate objectives, they were coming to believe that political compromise with the Soviet Union would prove difficult, if not impossible. It was on these stormy political seas that the world's first great effort at international atomic control was launched, on 14 June 1946. The protagonist was Bernard Baruch, President Truman's special representative at the United Nations for atomic disarmament. Sitting watching him from the stands of a converted gymnasium in New York City's Hunter College was a galaxy of diplomatic talent from all over the world. As Baruch intoned that 'we are here to make a choice between the quick and the dead,' cameras rolled and klieg lights glared. In effect, the Baruch proposal provided that all existing atomic warheads be deposited with an agency of the UN, that there be an embargo on the future production of atomic warheads, and that an agency of the UN be set up to verify compliance with the embargo. In the hubbub, the Canadian delegation sat quietly, biding its time. But some eyes were caught by the craggy, handsome profile of its leader, General A.G.L. McNaughton, former minister of National Defence, former chief of the army general staff, and former president of the National Research Council. McNaughton and the Canadians were in New York to see that something was achieved, and they had the entire support of their government behind them. I

It was well understood, however, that the Canadian government would tender its 'entire support' only if the United Nations Atomic Energy Commission (which produces the unfortunate acronym

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UNAEC) was successful. Like every other democratic government present, the Canadian government had its fingers crossed behind its back. For if the UNAEC did not succeed, the Western powers would need something to fall back on, and that something, providentially, already existed. This schizophrenic situation was duplicated by an administrative conflict. Not only were there two policies, but there were two groups of officials associated with them. The 'A' team we have already met, the bright and capable middle-aged men from External Affairs and the cabinet secretariat. Believing, correctly, that atomic policy was a political question par excellence, Hume Wrong, Arnold Heeney, Lester Pearson, and their allies in the bureaucracy wished to bring atomic energy under stern administrative control, while keeping all larger aspects of policy fluid pending the results of the UNAEC meetings. Unluckily for the External Affairs constellation, no minister was associated with their point of view in all its aspects, but their combined influence on Mackenzie King and the cabinet was great and, if events in New York went well, it could be assumed that it would prevail. Wrong and Heeney understood that things would go much more smoothly if the coach of the V team, C.D. Howe, was figuratively speaking, put out to pasture, to graze in industrial fields far from the diplomatic centre. The V team was a combination of civil servants and businessmen not much different in origin from the 'A,' but distinguished by its connection with Howe. It included people like Bill Scully, deputy minister of Reconstruction, John Baldwin, the future deputy minister of Transport, Bill Bennett, and, later, Mitchell Sharp, the future deputy minister of Trade and Commerce. It was not that Howe was inclined to interfere in political diplomacy; he scrupulously refrained from meddling in his colleagues' departmental concerns, and this was especially the case where the prime minister himself was the minister most directly concerned, as he was with external policy. Nevertheless, atomic energy was a field that Howe dominated, and where his ongoing administration might have the effect of compromising the diplomats' efforts in other directions. He did not appreciate being instructed by Wrong or Heeney, and he might have entertained the suspicion that neither man viewed him as irreplaceable. He would have been right.

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As early as August 1945, Wrong, or someone close to him, set down a 'rough draft' for an act to cover 'uranium and atomic energy' in Canada. There would have to be a minister with comprehensive powers to regulate production, distribution, sales, trading, and final disposition of all radioactive substances - in other words, virtually anything Eldorado might produce, an indication that in the existing condition of the official mind there was no likelihood of the company's return to the control of private interests. Under the circumstances, Wrong did not feel it necessary even to argue the point; he was more concerned with the location of Canada's atomic policies within the government. The usual practice was to have a minister responsible to Parliament for each and every government activity, and this would continue to be the case. But to reflect the many interests concerned with atomic policy, Wrong proposed the establishment of 'a small permanent committee' to proffer advice; the head of the committee, and presumably its dominant influence, should be the minister of External Affairs, Mackenzie King. Also represented should be the National Research Council, the Natural Resources Branch of the Department of Mines and Resources (presumably he meant the Mines Branch), and, bringing up the rear, 'possibly the Department of Reconstruction' - Howe's department. Although Wrong conceded that 'military or civil use' was possible, national defence was not listed as a vital concern.2 Wrong naturally discussed the possibilities of atomic policy with CJ. Mackenzie, who was then preparing for the Washington conference in November. 'These are very long-range problems,' Wrong wrote to Heeney. He and Mackenzie agreed that atomic energy in Canada would have to take institutional form, make reports, find a budget, and seek authority, especially since the wartime emergency was due, legally, to expire. Since atomic energy would be around for some time, it seemed to Wrong that 'the younger members of the Government should be responsible for dealing with [it].' The youthful (46) minister of National Defence, Douglas Abbott, would be ideal. Wrong did not need to say that C.D. Howe, age 60, was not ideal, both by this explicit criterion and, even more, by the unstated ones. Wrong also proposed that a committee of senior officials, chaired by himself and with Heeney,

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Dr Camsell of Mines and Resources, and the chief of the general staff, sit down to draft the necessary atomic energy act that would establish and regulate the field.3 Officials proposed, but ministers disposed. The cabinet defence committee, meeting in King's absence in London, simply decided that 'at the present stage, recommendations on policy should be formulated by the Prime Minister and Mr. Howe.' Howe, too, wanted an atomic energy bill, or so he told his colleagues: it should be 'on the general lines' of legislation then being discussed in the United States. As far as the cabinet was concerned, that was that until Mackenzie King returned from Washington (where he had proceeded from London) in mid-November. Although there does not seem to have been a formal cabinet discussion on the issue, Howe did advance Canadian atomic policy by one large, and very significant, step. Responding to a question from a Conservative member in the House of Commons, Howe firmly stated that Canada was not interested in the military potential of atomic weapons. 'We have not manufactured atomic bombs, we have no intention of manufacturing atomic bombs,' the minister told the House. As a statement of fact, Howe's pronouncement was unexceptionable. Canada had not made bombs, and had not spent money on making them. That fact now became policy, since no one in the cabinet or in the House of Commons thought to question or contradict it.4 Christmas 1945 came and went. The establishment of UNAEC was announced. Behind the scenes, Howe battled with the British over the future of the heavy-water reactor at Chalk River,* and with the Americans and the British over the terms of reference of the Combined Policy Committee (CPC) and Combined Development Trust (CDT) (below, p. 176). The minister left on vacation, and the minister returned from vacation. It was by then spring, and high time to start preparations for the meeting of the UNAEC in June. Since Howe was still very much in place, preparations had to start with him. Arnold Heeney took the initiative, in a letter to Howe on 20 * The reactor was the final fruit of the Anglo-Canadian wartime project. Usin heavy water and natural uranium, it was an alternative to the American reactors built during the war.

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March 1946. The United States, Heeney reminded Howe, had just named Bernard Baruch to head up its delegation to the UNAEC; the British, too, had appointed their delegation. Was it not high time to think about what Canada would be sending to New York, and about what Canada's representatives would be saying? To start, Heeney proposed an advisory panel, to consist of himself as chairman, Hume Wrong, CJ. Mackenzie, and Omond Solandt, from the defence research establishment. Just at the end of his letter, Heeney delicately alluded to a rumour that had reached him. He understood that Howe's departmental counsel, Charles Gavsie, was working on a bill 'to provide for domestic control of production, research and development' in the atomic field. Perhaps when the bill was ready, it could be sent to Heeney's proposed panel (if that suggestion proved acceptable) for vetting prior to consideration by the cabinet. Howe sent an amiable response. Gavsie had indeed drafted a bill, and he would send it over forthwith. There was no objection to an advisory panel, or to having it look over such a document. But perhaps Heeney's suggested membership could be improved upon. Howe's list included George Bateman, whose familiarity with mining as well as his status as Howe's delegate in Washington gave him an obvious expertise. Lester Pearson, Canadian ambassador in Washington, had already represented Howe on the CPC, and therefore was a natural choice for such an advisory, expert, body; besides, Pearson's sunnier personality made him a better choice from Howe's standpoint than Wrong. The other suggestions, Heeney, Mackenzie, and Solandt, were acceptable. A certain amount of to-ing and fro-ing now took place. Howe got Bateman, but he would not get Pearson. The latter's job was in Washington, and not in Ottawa where the panel would meet. Hume Wrong it would be, though ironically, when Pearson came to Ottawa in September 1946 and Wrong went to Washington to succeed him, Howe's original wish would be entirely met, with one addition. Mackenzie King had the choice of the head of the Canadian delegation. According to George Ignatieff, who served on the Canadian UN delegation, 'Mr. King, when making his choice, had inquired what kind of representatives the other countries were sending ... He was told that some were appointing diplomats,

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others scientists, and some were sending politicians. Mr King had commented: "McNaughton - all three.'"5 McNaughton's selection was important for a number of reasons. He was too senior to be identified either with Howe's interests or with those of External Affairs. He was fiercely independent although, after thirty years in government, he knew how to be conciliatory when he absolutely had to be. He was a strong Canadian nationalist, unlikely to give away any Canadian interest. And he had the drive and determination to stick with an unpopular and unpromising cause, which the international control of atomic energy promised to be. Because of McNaughton's unusually strong position, his views on the arrangement of atomic energy acquired importance in the domestic debate on the subject, especially because he was targeted to become the first head of Canada's domestic atomic control agency. That agency was taking shape under the guiding hands of the advisory panel on atomic energy. The first draft bill, as we have seen, was Gavsie's. It reached the advisory panel on 16 April 1946 after scrutiny and revision by Wrong and Heeney. By the end of that month, it was possible to discern a shape for the new atomic agency. It would parallel the National Research Council, and like the council, would be responsible to the cabinet committee on scientific and industrial research, which Howe chaired. (It was too early for the panel to know that the cabinet committee would be dormant under Howe's stewardship, if not actually moribund.) The new agency, to which the title of Atomic Energy Control Board was given, would be purely domestic in scope: it could not travel abroad to sit at the CPC or usurp External Affairs' functions at international conferences. In this it was a notable contrast to its American counterpart, the Atomic Energy Commission (AEC). The draft bill provided that the Atomic Energy Control Board could create 'subsidiary corporations,' which might include Eldorado. Such corporations would act 'through and under the authority of the Board or the Committee of the Privy Council or both.' George Bateman, sitting on the panel, was not pleased with what he saw. The board's powers were too stringent and too specific; what there should be was a general statement of purpose, leaving the rest to circumstance to work upon. After reference to the cabinet,

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this was conceded: a statement of general principles would sit in the preamble to the bill. When all was finally agreed, the draft bill went to Howe, the minister who would introduce it, complete with a draft of suitable remarks when the bill was introduced. Originally written by George Ignatieff, the panel's secretary, the statement was revised after consultation with Bateman and Gavsie. The Atomic Energy Control Board, Howe told the House of Commons, woud be 'primarily a policy board.' It would be 'organized, and will function, much along the lines of the National Research Council,' whose president, C.J. Mackenzie, would sit on the board to guide its deliberations. Presumably this met with general satisfaction, since debate on the bill was muted, a phenomenon which may be attributed to the politicians' relative ignorance of the subject, and to their prideful satisfaction with a situation that placed Canada among the three atomic powers of the world. The bill passed the House on 18 June and then the Senate. Royal assent was given in 31 August, and the bill was proclaimed on 12 October 1946. Canada had an Atomic Energy Control Board, and McNaughton was its chairman. The other members were V.W.T. Scully, Howe's deputy minister at Reconstruction and Supply, Dr Paul E. Gagnon, director of the Department of Chemistry and Chemical Engineering, Laval University and, not surprisingly, C.J. Mackenzie and George Bateman.6 The act appeared to give the board wide and sweeping powers. However, Howe was quick to point out to Bennett, who had expressed some concern on this score, that these powers could only be exercised with the approval of the National Research Council. The board could, and did, regulate who would work in the area, and under what conditions. It had a technical function, and because of the overlap between its work and that of the advisory panel, it never ascended into the blessed realm of higher policy, closer to Howe and the cabinet. At the same time, because it was restricted in scope to narrow questions of technical policy, it remained a shadow of what once had been expected. For this development, Howe must take responsibility, as he must also do for what would subsequently happen to the advisory panel. It was, Howe wrote, 'all right with me' that the 'atomic bomb is moving into a sphere of diplomacy.' Howe protested too much. In fact, as he

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explained to George Bateman, 'the only danger is that if Mackenzie and I get too far away from policy matters, the operation in Canada will suffer.' It followed that Howe wished to remain in touch with policy matters, and that he disposed of enough political influence and practical experience to make this come about.7 The only hope that now remained for the Department of External Affairs was the success of the UNAEC discussions in New York. These began at the end of June, and lasted until September 1947. Their history may be briefly summarized. The Canadian delegation supported both the exposition of an international plan for control, and compromises between the Americans and Russians designed to keep the talks alive. The Americans essentially took the position that they could not disarm until an effective inspection and control mechanism was in place, while the Russians argued for abolition now, control later. The Americans sketched out an elaborate international agency with broad powers including 'dominion' over such items as uranium mines — whic would eventually monopolize all significant atomic functions. The Russians relied on vague visions of a future Utopia, and argued that this happy state could not arrive until the threat of the American nuclear monopoly was removed. The Americans understood very well, as George Kennan argued, that the abandonment of their nuclear option would enhance Soviet power without the Americans gaining anything tangible in return. Should such unilateral disarmament occur, the Soviets could continue to develop their own nuclear weapons, while exploiting the diminution in the United States' strategic power.8 Under these circumstances, Canada's tactics at the UNAEC were designed to build up trust between the two superpowers. McNaughton spearheaded a series of technical hearings during the fall of 1946, hoping to establish common ground on the basis of facts - facts about mining uranium, for example, and facts about refining it. Eldorado and the Mines Branch had their role to play in McNaughton's expert hearings in New York, and it is worth recording the company's first formal appearance in an international, diplomatic setting. At the same time the Canadian delegation worked to diminish the Americans' enthusiam for the international administration of such items as uranium mines.

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Canada was not alone in this regard, and the cumulative pressure on the u.s. delegation gradually told. 'One by one,' an American delegate wrote in October 1946, 'the delegations of Canada, Brazil, Australia, France, United Kingdom and China have expressed their relief at our willingness to depart in this respect' from the original doctrine of 'dominion' over raw materials. It is doubtful if this softening of the American position on what was essentially a technical matter (how best to keep control, and at what stage, over radioactive materials) had any effect on the attitude of the Soviet Union. The USSR wished to preserve a veto over the efforts of any international agency to supervise, control, or restrict atomic developments. At the same time the technical negotiations and testimony made plain how vast the problem of control would be, and how easy it would be to evade even the most stringent controls. After paying a visit to the Canadian atomic reactor at Chalk River, a member of the Canadian delegation 'estimated that that establishment alone would require a minimum of twenty or thirty full-time inspectors and even with them it would be easy to falsify the records of the plant's output.'9 The whole enterprise finally collapsed, although like most diplomatic discussions its collapse was gradual, a matter of descending chords on the international scale. The Canadian delegation was not, finally, displeased that the negotiations had not gone further. Substantial American concessions were not reasonable, and it was all too obvious that the Soviet Union was beating the drum for peace while hoping to secure a military advantage. And yet there had been hope, hope that something permanent might be achieved, hope, perhaps, that a miracle would occur. It did not, and for Canada the focus of international atomic diplomacy now moved back to Washington, and to the CPC. II

The Combined Policy Committee, as we saw (above, p. 162), had been left in place by the Washington conference of November 1945; so had its uranium procurement agency, the CDT, or Combined Development Trust. The Anderson-Groves memorandum of 16 November, which was cast in the form of recommendations for the

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Combined Policy Committee, had redefined and expanded the scope of the trust by authorizing the three governments, Canada, Britain, and the United States, to buy up or otherwise possess 'all deposits of uranium or thorium in areas comprising the United States, its territories and possessions, the United Kingdom and Canada,' as well as anywhere else that they could get it. The national territories of the three governments had been specifically excluded before, but now the products of all were to go into the common uranium stockpile, to be doled out by the trust according to need. It might seem a technicality for Canada to object to this arrangement. After all, all Canadian uranium was contracted to the United States, although the Americans in return supplied uranium metal for the Chalk River facility. But that Canadian uranium was contracted for, rather than allocated by an international body on which Canada was most distinctly the junior member. The one arrangement protected Canada's sovereign jurisdiction over its resources; the other was clothed in ambiguity. The point was reinforced by the fact that uranium had become, temporarily, the scarcest and most desirable of commodities. Like radium before it, uranium held the key of life and death, this time of whole countries; and some countries would do anything to get it. The fact that uranium was perceived to be scarce requires some explanation, since, abstractly, it is not an uncommon mineral. Large deposits of uranium, however, are comparatively rare, and large, rich, deposits of the substance were, in 1945, very few. As of the end of the war, so the CDT believed, 97% of the uranium resources of the world were in its hands. This included the Belgian deposits in the Congo, Great Bear Lake, and the United States' vanadium by-products. By resources it meant developed resources, which meant that the remaining 3%, in Joachimsthal or Jachymov, were the sole existing, immediately exploitable, source available to the Soviet Union, which had occupied Czechoslovakia at the end of the war. 'Resources' did not include potential resources. Lower-grade ore was known to exist in two other countries, South Africa and Sweden. The South African supply was probably going to be procured by the CDT, while Sweden at least promised not to sell to

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the Russians. Bateman, however, believed that there were other uranium supplies that were bound to be exploited. 'Looking ahead 10 years or more,' he wrote in November 1945, 'to large tonnage low grade deposits which might be developed provided no consideration was given to cost, the Trust group of nations controls 35%, namely, the U.S.A. and India. The remaining 65% is divided between Russia and Sweden.' The trust group could take no comfort in the presumed inferiority of Russian resources in spite of Bateman's view that Soviet uranium could 'only be brought into substantial production if no consideration were given to cost.' In a society where labour costs could be concealed behind the barbed wire of concentration camps and where normal precautions could, if desired, be omitted, nothing was more certain than the development of whatever uranium resources the Soviet government could identify. No consideration would be given to cost, especially since much of that cost would be borne by others.10 As long as there existed some possibility, however slight, that the UNAEC talks would change the world uranium situation, there was no particular urgency to the Anderson-Groves scheme for the CDT. The Manhattan Project was marking time, waiting for developments, which included, in 1946, the passage of legislation governing the development of atomic energy in the United States. Howe could, therefore, conduct a campaign that aimed at changing the terms of the Anderson-Groves agreement, and which would preserve Canadian uranium for Canada. If Canada's resource had to be sold abroad, it would be sold on terms to which the Canadian government freely consented. It helped that none of the three governments concerned was entirely happy with the Anderson-Groves agreement. The British wanted more, the Americans wanted less, and the Canadians, as far as the trust was concerned, wanted out. Canada had no objection to the more general terms of the memorandum, Howe instructed Lester Pearson, who was to represent him at the December meeting of the CPC. There was serious objection, however, to the proposed terms of the CDT. Howe's objections were deprived of some of their force, unfortunately, because the minister had only a cloudy comprehension of the original understanding for the trust. Canada, he told Pearson, was not even a member of the trust. Bateman did not

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represent Canada, or even Howe himself: he was a delegate of the government of the United Kingdom. Canada had had no financial responsibility for the trust, but instead had undertaken, at its own expense, 'exploration for and development of uranium ores within the Dominion of Canada.' The best solution from Canada's point of view, Howe concluded, was to leave the present arrangement unchanged. The view that he was not and had never been an official Canadian representative was news to Bateman and an embarrassment to Pearson. Pearson took refuge in silence, leaving Bateman to reason with Howe. Bateman mildly observed in a letter to the minister, that 'there ... appears to be some confusion about my position on the trust. I have always considered myself as being there as your representative and therefore as the Canadian representative.' After all, Howe had asked him to serve, and Batemen sent a copy of the original letter to refresh his friend's memory. With that red herring, as he hoped, out of the way, Bateman explained that the Anderson-Groves memorandum was really an example of bad drafting and not of bad faith. There was no intention to poach on Canadian resources or to interfere with Canadian priorities. All that was meant was that each member government would purchase all uranium produced in its territory and resell it, at cost, to the trust after deducting whatever it needed for its own purposes. Thus, the trust would buy only 'unallocated material.' If Howe objected, Bateman argued, then he would have to be logical and carry his objections to the point of disassociating his country from the CPC as well. It was one of the CPC'S main functions to allocate raw materials. This the trust was doing, and Canada had always conceded that this function was both desirable and beneficial. If, in other words, Canada objected to one of the CPC'S integral functions, then it would have to put up or shut up: withdraw or keep silent. Under the circumstances, Bateman advised silence, at least until the Anderson-Groves memorandum could be redrafted.11 Howe's response is not recorded, but he did not carry his arguments any further. Nevertheless, his fears were not entirely misplaced. Hard on the heels of his letter arguing the virtues of the CPC, Bateman wrote again on 7 December, detailing a disturbing

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conversation he had had with Sir Charles Hambro, the expansive and cheery British representative on the trust. Hambro, Bateman told Howe, had raised 'the financial question. He had in mind the hope that Canada would share equally with the U.K. the U.K.'S financial commitment to the Trust.' Bateman promptly responde that any such proposal would be ill advised. 'I told him,' the Canadian representative steamed on, 'that at the present time Canada had spent considerably more in connection with this project than the U.K. had obligated itself for to the Trust, and that such a proposal would be inappropriate until such time as the U.K. had actually spent as much as Canada, even if then.' Hambro seems never to have returned to his proposal, and the British somehow found the money in their depleted dollar reserves to carry on.12 While Bateman was guarding Canada's financial flank, Pearson was worrying over forms of words. A drafting subcommittee consisting of Groves for the United States, Roger Makins for Britain, and Pearson for Canada was interpreting the AndersonGroves memorandum. They made good progress, and when the result reached the Canadian cabinet on 30 January 1946, Howe had been convinced by Bateman that they represented 'a reasonably satisfactory basis for Canadian participation.' The occasion was doubly satisfactory for Howe, for it re-emphasized his mastery of the atomic field in Canada, and correspondingly depressing for Arnold Heeney, who as cabinet secretary had to record it all. The discussion in cabinet, Heeney told Pearson, was 'pretty peremptory.' Howe assured the cabinet that Canada had 'no financial responsibility' for anything the trust did, and the cabinet happily concurred in what had been done. Heeney was convinced that the form of the cabinet's concurrence was more important than the substance of what they were agreeing to. To have any discussion at all, he wrote, 'represents a step forward,' but it was obvious that 'apart from Mr. Howe, none of the Ministers (including the Prime Minister) has any clear understanding of what is involved.' So, Heeney feared, it would be in the future; and he was right.13 Bateman and Pearson anticipated that the CPC-CDT agreements in their new form would be confirmed when the CPC met on 1 February. Unfortunately, that meeting fell victim to the hapless

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and sometimes well-meaning confusion that accompanied Truman's secretary of state, Jimmy Byrnes, on his round of duties. Pearson and the British watched, astonished, as an ill-prepared and divided American contingent fumbled for a way of avoiding a written and binding agreement of any kind. Byrnes, Pearson reported, would doubtless now try to carry on regardless, in the hope that co-operation would last without any new agreement. If such an agreement was unnecessary, then Pearson, Groves, and Makins had wasted the previous six weeks drawing one up. The Americans, he decided, or at least their secretary of state, were 'casual and ill-informed.'14 The consequences were much more serious for the British than for the Canadians. The British wished to set up their own atomic program, including facilities for making bombs. The Americans dreaded the prospect, in part because Britain was so much closer to the Soviet Union and the Red Army; unable to prevent it, they took refuge in delaying it. To get things started, the British requested a 50-50 division of the available uranium stocks under the trust, with the second 50% representing an Anglo-Canadian joint share. When Pearson reported this, Howe's irritation with the British, which on matters atomic was never far beneath the surface, bubbled up again. 'Our U.K. friends,' the minister minuted, 'seem to be moving toward obtaining control both of the operation of the Eldorado mine and the output therefrom. Canada cannot agree to this and if there is no other alternative we would do well to refrain from holding a membership in the Trust.' Beneath the rhetoric, Howe had something practical in mind. Eldorado production, optimistically estimated at 300 tons of oxide per year, would be available for allocation once Canadian needs (for Chalk River) were satisfied. There could be no question of bringing Eldorado itself under any kind of shared international jurisdiction, partly because the company ramified into transportation, and because mining in Canada, even uranium mining, was at best a joint affair, shared with the provinces in such areas as mine safety, health, and labour relations.15 Howe's fears were exaggerated. The British would welcome Canadian uranium, under appropriate conditions, but Canada alone could not begin to supply them. As Bateman told Howe, they

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needed 1500 tons a year. That tonnage could only come from the Congo, which exported 4000 tons a year, compared to Canada's assumed 300. It they could not get it through the trust, they would have to seek it elsewhere - as they had once contemplated doing, back in 1943. The prospect that the trust might be damaged or destroyed through Anglo-American disputation held no terrors for Howe, no matter how much Bateman deplored it. 'I feel that we will always find a market for our uranium regardless of the Trust,' he wrote serenely on 18 April 1946. The only immediate question in his mind, Howe wrote to Bateman, was whether Canada needed to go one step further and build a uranium metal-fabricating plant so as to be independent of American supply. That question was apparently answered in the negative, for the time being; but it would be asked again.16 The CDT meant too much to both the British and the Americans to be abandoned. For the Americans it was convenient, and for the British it was essential. For the Canadians it was neither, except in a special and restricted way, which we shall mention below. The trust went on handling Congolese uranium and dividing it between the British and the Americans. Bateman continued to sit on the trust, and Canada continued to contribute nothing in the way of cash; doubless the British and Americans were satisfied with the donation of Bateman's time and judgment and experience. What Bateman got, he passed on to Howe, and through Howe to Eldorado. (Eventually, as Eldorado developed, he found he could bypass the minister.) The CDT had to assess the state of the world's supply of uranium. It received the highest level of information or speculation, all paid for by the governments of Britain and the United States. It meant that for the next decade, Eldorado could confidently predict the shape of uranium supplies the world over. How Gilbert LaBine would have welcomed comparable information back in the 19308, as he fought to piece together rumour and gossip in his struggle with the Union Miniere. Eldorado's external environment, then, was shaped by factors both national and international in scope. The fact of Canada's continuing international relationship with Britain and the United States through the CPC and CDT meant that national control ov uranium was essential. National security, alliance politics, and

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international co-operation all pointed in the same direction. At the same time, the Canadian government was not about to let its prize slip into international hands, tripartite or multilateral. Howe's defensiveness over Eldorado's future in 1945—6 is closely related to that other aspect of Canada's atomic policy, the Chalk River experimental reactor, and the possibilities that that held for atomic power. Although much remained to be proved, Howe considered that he and Canada held an asset, and that it would continue to serve Canada's purposes long after any temporary unpleasantness between the British and the Americans, or even the Americans and the Russians, was forgotten. For that, Eldorado must remain in government hands. Ill

There is no simple definition of a crown company, and attempts by lawyers and political scientists to simplify the problem have succeeded only in complicating it. Crown companies or corporations are as old as Canada itself. The Maritime provinces were linked to central Canada by means of a crown corporation, the Intercolonial Railway. A second transcontinental railway was saved from bankruptcy in 1919 by turning it into the Canadian National Railways. Coast-to-coast air service was established in 1937 - by C.D. Howe - in the form of Trans-Canada Airlines. During the Second World War, the Canadian government bodied forth no less than 28 crown companies, of which Eldorado was one. Most of these were wound up at war's end, but some, most notably Eldorado and Polysar, are still around. Prior to 1944, Eldorado was an Ontario corporation, incorporated under the laws of that province. On 28 January 1944, by order-in council PC 535, Eldorado became a federal company, incorporated under the Dominion Companies Act of 1934. C.D. Howe, who secured the incorporation, was authorized to do so under the War Measures Act, that omnibus emergency legislation that empowers the government of Canada, under certain circumstances, to proceed as it sees fit. PC 535 appropriated all the shares of Eldorado Mining and Refining and vested them in the crown, whose agent, Howe, thereby became Eldorado's sole shareholder.

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(Company directors, of course, must have 'qualifying shares' under the Companies Act, but in the case of crown corporations, they hold them in trust for the King or Queen of the day. The directors' authority, subject to direction from the minister, remained the same as before, but the qualification was an important one.) Like other crown companies, Eldorado stayed outside the umbrella of the various civil service acts, and like some other crown companies, its assigned task resembled that of other companies still in the private sector. (The most recent rendering of this aspect, by two law professors, is: Tasks akin to private sector entrepreneurial undertakings in a private setting.' The reader can take his or her pick.)17 Lastly, Eldorado was ultimately responsible to Parliament and through Parliament to the Canadian people. There was, from 1944 on, a minister, whose duty it was to answer, or refuse to answer, questions put to him in the House of Commons on the subject of Eldorado. Ultimately it was C.D. Howe's responsibility to see that Eldorado was well run. By the end of 1945, Howe had more than an inkling that Eldorado was not, in fact, well run. He had tried to keep the company going under its original management, and now a goodly part of that management was under indictment, while questions were being asked in the House. Howe had to act, and as usual he moved quickly. Someone reliable had to be placed inside the company, with the authority to make decisions, it was too soon to make Gilbert LaBine the public scapegoat for what had been going on. In any case, LaBine was innocent of any wrongdoing; the trouble was, he was innocent of any clear idea of how his company had been working for the past three years. It was also possible that LaBine would have to appear in court, and his prestige would not have been enhanced, before a judge and jury, by his dismissal. Howe therefore turned to another, more oblique, tactic. Sitting in Howe's outer offices was his chief executive assistant, William J. (Bill) Bennett. Bennett, who turned 34 in November 1945, was a railwayman's son from Schreiber in northern Ontario, part of Howe's Port Arthur constituency, and an honours graduate of the University of Toronto. Bennett had taken an interest in Howe's first election campaign in 1935, and from that successful effort came an invitation tojoin Howe in Ottawa in November 1935

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as his private secretary. By the time he was 30, Bennett was running Howe's office. He knew Howe's fellow ministers and the junior politicians who sat expectantly under them, hoping to join the charmed cabinet circle. Some, like Paul Martin and Lionel Chevrier, did. Ottawa being a small town, Bennett also got to know many of the up-and-coming civil servants, the future mandarins. Some, naturally, were preferable to others. John Deutsch of the Department of Finance and John Baldwin of the Privy Council office were close friends. And nobody could dislike Mike Pearson. But most of those in Howe's circle found Hume Wrong difficult to take in long doses at short intervals. Relations with Wrong improved after he was sent south to Washington. Bennett was, therefore, well connected and experienced in the fine art of saying yes, no, or maybe. During the war years, he had demonstrated his ability to analyse and solve problems and because of this had become a trouble shooter for Howe in the wide range of industrial activity, including mining, encompassed by the Department of Munitions and Supply. Coming from northern Ontario, he knew something about mining promoters; he was related to one, Fred Connell, who had replaced George Bateman as metals controller. Bennett had never intended staying in Ottawa and he had met enough people in the business community to make them aware of his value. In July of 1945 he had, with Howe's blessing, made arrangements to join a private company at the end of the year. However, in September, fate took a hand.18 As noted previously, Grant Glassco of the Clarkson, Gordon firm had made an enquiry into the affairs of Eldorado. Glassco expressed his concern about the state of the company's management and finances to John MacAulay, a personal friend of his who was also a director of Eldorado. Together, they saw Howe and urged strongly that a change in management be made and they recommended Bennett for the job. Howe agreed but Bennett's consent was also needed. He knew that Eldorado was in a mess and he had some passing familiarity with its affairs.1Q He knew, and Howe confirmed, that the future of the company was most uncertain. No one knew whether there would be a post-war market for Eldorado's products, but both men assumed that unless there were such a market, the company would have to be closed down.

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Eldorado

Howe did not believe in pouring good money after bad, and he saw no point in keeping a uranium company in existence just because it could produce, at great cost and with considerable difficulty, a small amount of uranium. Nevertheless, the possibility that Eldorado's products would be required for the u.s. bomb program was there, and until that possibility was resolved there would be some justification in keeping the company afloat. It sounded like a short-term assignment, and Bennett accepted it on that basis. His prospective employer agreed to wait, and Howe set matters in motion. There were plenty of matters to be disposed of. First, Howe's Department of Munitions and Supply was winding down and Bennett's detailed knowledge was required. Finally, 'Lunched with Gilbert LaBine and one of his Directors from Winnipeg [MacAulay],' C.J. Mackenzie wrote in his diary on 25 March 1946, 'and Bill Bennett.' The four men discussed Eldorado 'and they told me re organization and Bennett's proposed position in the company.' That position was vice-president, a new category, and managing director. LaBine would stay on as figurehead president.20 Lunch was on a Monday. That Friday, the 2Qth, in Toronto, the company's board of directors assembled in the company offices in the Toronto Star Building. For Charlie LaBine, it was his last day as a director, and it was not a happy occasion. Then, in the dry words of the board minutes, Gilbert LaBine announced that 'it was necessary to procure the services of a man capable of taking over the managerial responsibilities, and also to fill the vacancy caused by the retirement of his brother, and he recommended engaging Mr. W.J. Bennett, at present executive assistant to the Honourable Mr. C.D. Howe.' The board did its duty, making Bennett vice-president and managing director at a salary of $10,000 per annum. 21 Eldorado had a full roster of problems. It was not clear that head office had a sufficient grasp of what was happening in the field, either at Port Hope or at Port Radium, as the mine facility was coming to be called. Nor was it obvious what financial shape the company was really in, though a team of accountants under Glassco's direction had been working on that problem for the best part of a year. Pregel's contract, Eldorado's suit, and Pregel's counter-suit tied up money and radium, and drained cash to pay

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for legal fees. To make matters worse, during 1945 investigators turned up alarming reports of deficiencies in health standards at both the refinery and the mine — difficult problems with costly solutions. At least solutions were possible in that case. Other difficulties seemed to appear daily. The grade of ore at the mine was beginning to fall, from i % — where it had been during the war — to 0.6%. Discrepancies showed up between assays of concentrates made at the mine and analyses of the same concentrates at Port Hope. Ore reserves, calculated in terms of contained uranium oxide, slipped, to the point where two years' supply was all that could be reliably estimated. An exploration program, begun in 1943, had yet to turn up radioactive showings that were worth digging for. Yet exploration was expensive - a regular and unrequited drain on revenues. But where would the revenues come from? To get by, both Eldorado and its transportation subsidiary, Northern, resorted to bank overdrafts. Despite the outstanding contracts with the u.s. Army, money was flowing out faster than it could come in, and when, in the summer of 1946, the refinery's supply of soda ash was interrupted, there was no alternative but to close it. No production, no income. In the longer term, there was little joy. General Groves and his staff at the Manhattan Project were reluctant to do much more than housekeeping in 1946; and the British were uncertain both of what they needed and of how to pay for it. As for the company's other product, radium, markets disrupted by war stayed closed by reason of Europe's dollar shortage. The Europeans, including the British, had very few dollars to spend. Eldorado could produce radium until it overflowed into Lake Ontario, but in a normal commercial sense, its market was very restricted, it was just another conundrum to add to the larger question: was Eldorado worth keeping afloat? IV

At the end of 1946 Eldorado consisted of 438 souls, exclusive of officers and directors. Of this number, 11 worked at head office, 161 at the refinery, 248 at the mine, 12 in aircraft division, and 2 in

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Eldorado

exploration. A sales division, established during the year, had been worked up to four. These employees, along with their officers and directors, sat on top of a deficit of $405,279.55 - up from $206,357.87 the year before.22 The figures might be taken as encouraging. The deficit was not worse than it was - and the company was still in business - because the Government of Canada had decided that it must stay in business. This decision was taken before Bennett's appointment, but on his advice after a preliminary reconnaissance through Thomson's data and Munitions and Supply's files. The company, he and the accountants found, was cash-poor to the tune of $2,943,000. To survive, therefore, Eldorado's first act under its new regime was to apply for a bail-out — an ironic, secret commentary on the hopes of those former shareholders who regarded the company as the original goose that laid the radioactive eggs. Howe, who had decided for the moment to keep the company in being, obliged with an advance for the sum requested. Then, on Bennett's advice, he converted the load into equity since, as Bennett delicately put it, 'there was no immediate prospect of repayment.' For its money, the government got 20,500 shares.23 The board was appreciative. Now that Bennett had shown what he could do for the board, it was time for the board to show what it could do for Bennett. Eldorado was not top-heavy with managers. LaBine's head office might have had its problems, but over-staffing was not one of them. There were secretaries and a few accountants, but otherwise management was in the field. Authority travelled with Gilbert LaBine, on regular tours of inspection, or with his immediate representatives. During the war, the board had taken little part in management and had had no information on which to base any advice it might give. That suited some board members, who were getting on in years and as far as Eldorado was concerned were becoming more sedentary in disposition. R.L. Birks, a Toronto lawyer, fell into this category, as did Fraser Reid who, as we have seen, had once played a major role in the design and operation of the Port Radium mine and mill. John MacAulay, of Winnipeg, the other senior member of the board, was still very much a going concern, and had been closely associated with Eldorado ever since its early speculative days. MacAulay was always

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ready with good advice, but on mining problems it was from the point of view of the knowledgeable amateur. Bennett could use what MacAulay had to give him - moral support and shrewd business analysis — but it was not enough. That was where the two most junior members of the board, appointed in 1945, came in. 'Dr. James and Professor Williams,' as the minutes call them, were, respectively, a professional consulting geologist and a professor of mining engineering at the University of Toronto. William (Bill) James had helped pioneer consulting geology in the 19205, and by 1946 what James had to say counted heavily with mining investors. It counted with Howe, who admired James by reputation, and who had a high regard for expert advice when flavoured by the scent of success. Charlie Williams, despite his professorial title, was a veteran of the mines of northern Ontario; he had worked at one of the biggest, Hollinger, before starting to teach. Mining and milling held no terrors for him, and if they were part of the problem at Eldorado, Williams was prepared to tell Bennett how to solve them. Between 1945 and 1950 James and Williams were effectively Bennett's senior advisers on mining practice and geological lore. That, James later stated, was a mandate from Howe himself: 'See if you can teach the bugger something about mining,' he quoted Howe as saying. He had, he thought, but that was only because 'Willie was a quick study. In six months he was teaching me.'24 Bennett made two adjustments in his first months as director. He replaced the company's secretary-treasurer, French's successor, who was pensioned off with a golden handshake, and he moved the head office to Ottawa. The new secretary-treasurer was an older man, born in England, and with long service as an accountant in Montreal before the war. What brought Harry Haydon to Bennett's attention was his service as the comptroller of the wartime Department of Munitions and Supply. That had wound down, and rather than go back to Montreal and start over, Haydon welcomed the chance to go on working with Bennett. Haydon would eventually prove invaluable; what was important at the time was that he was judicious, friendly, and reliable. It was just as well that he had all these qualities, since his job, at its worst, involved frequently saying no. To assist Haydon, a transfer was already in

i88

Eldorado

tow: R.C. (Bert) Powell, the mine accountant at Port Radium, was brought back after four years in the Arctic. His first job was to pack up and move again, from Toronto to Ottawa, where he, Haydon, and Bennett set up shop in Number Three Temporary Building, a rambling wood-frame construction on the north side of Wellington Street. The move to Ottawa was undertaken, as Bennett told the board, at the minister's direction. Howe could be forgiven for wanting Eldorado under his eye. One of the most pressing problems was the decline in the grade of the ore available for mining at Port Radium that resulted in very poor recoveries in the mill. Shortly after his appointment, Bennett discussed this problem with C.S. Parsons, the director of the Bureau of Mines and Parsons agreed that the bureau woud take on the assignment of trying to develop improved or new milling processes. He thought that flotation might be the answer and with that in mind engaged as a consultant A.M. Gaudin of the Massachusetts Institute of Technology, a leading authority in this field. Two expeditions set off from Ottawa in the summer of 1946. Bennett and James headed west and north to inspect Eldorado's empire: Northern Transportation's office and depots along the Mackenzie River system, the mine at Port Radium, and the spaces in between. The key men to meet were Frank Broderick, NT'S general manager; Kelly Hall, NT'S director of operations; Al Caywood, the head of Eldorado's aviation division; Richard (Dick) Murphy, the geologist heading up the exploration program; and Ed Bolger, the mine manager. Bennett had to introduce himself as well as inspect others — an important point, since Gilbert LaBine had recently been north and for some at least had conveyed no very warm impression of the new order in Ottawa. The second party consisted of C.S. Parsons and A.M. Gaudin who wished to examine the milling situation at first hand. Bennett and James left no contemporary record of what they found at Port Radium, but Gaudin did. 'The place was definitely gloomy,' he wrote, 'and in the frame of mind which can best be described as funereal.' The reason was not hard to find. The mine staff knew what the grade of their product was, and understood that their ore reserves might not last more than another two years.

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They also knew that costs were rising, and with costs, prices — though Bennett was horrified to discover that no one at Port Radium, including Bolger, had any idea what price the company had been charging for its uranium oxide. The relation between cost and price was correspondingly unusual — unusual in the sense that Eldorado could not possibly make a profit.25 Bennett left Port Radium with two objectives in mind. The first concerned the mining operation. An adequate program of mine development had not been maintained since the mine was reopened in 1942 because of the high priority given to achieving the maximum rate of production. As a consequence, the reserves of ore had been seriously depleted. It was imperative, therefore, that an extensive development program should be planned and launched and with no delay. The second was that morale and staffing at Port Radium must be improved, and with them productivity. It seemed unlikely that Bolger would find such a task easy or congenial, and it therefore became necessary to replace him, as painlessly as possible. It was already too late in the 1946 season to make such a move and it would take time to identify and sign up a suitable successor. James began to work on that task.26 Quick results were not to be anticipated from Port Radium, but time was of the essence in Bennett's next job. That was no less than the renegotiation of Eldorado's last contract with the u.s. Army. The contract under scrutiny had been signed in November 1944 and provided for the delivery of 310 tons of uranium oxide. Thomson had handled the negotiations, and LaBine had worked on Eldorado's terms. Bolger, who was consulted at the time, thought that he would have no difficulty in finding the ore. Pochon, still at the refinery, calculated his costs. Putting all the figures together, Thomson and the Corps of Engineers arrived at a price of $4.62 a pound of U3Og. The basis of the contract was 'no profit, no loss.'27 On the surface things went smoothly, although behind office doors some misgivings began to be expressed. Bert Powell, then the mine accountant, later recalled 'a bit of ruckus on a visit in 1945 by G. LaBine about production being less than Bolger had promised, probably due to lower grade.' The reader will recall that it costs the same to mine a ton of waste rock as it does to mine a ton of

19°

Eldorado

high-grade ore; the difference lies in the cost per pound of embodied U3O8, which would naturally be much higher as the grade descended. As Merritt later put it, in a letter to Groves, 'the Contractor found that he had a sufficient quantity of ore, but the ore was not of the quality anticipated.'28 'I went with my hat in my hand to see General Groves,' Bennett said. What he had to say was simple. A bargain had been struck on the basis of inadequate information. The true bargain between Canada and the United States, however, was the 'no profit-no loss' principle, which both parties had accepted in the common cause of building the atomic bomb. Groves had no objection to the principle, but if Bennett wished him to revise a contract favourable to the United States, then Eldorado would have to open its books to examination by Groves's officers. Phillip Merritt, who had been working withEldorado since 1942, was selected to do the examination. The result was, from the company's point of view, exceedingly fortunate. Merritt told Groves that Eldorado's plight was real, and that a true representation of costs woud be $6.17 (Canadian) rather than $4.62. Of that sum, $2.60 represented mine costs, $1.86 depletion, depreciation, freight, and insurance, and $1.71 refinery costs. By Merritt's figures, the United States owed $3,825,400 on the contract, which, in Bennett's words, 'has resulted in the avoidance of a loss to the Company of approximately $961,000.' Bennett was more explicit in a letter to Groves in mid-December 1946: Eldorado, he wrote, was in a state of 'virtual bankruptcy'; Groves was its saviour.29 Most of the $6.17 was paid over immediately, rather than on completion of the contract. By instituting 'progress payments,' the Americans relieved the company of the burden of finding its own long-term financing for the year-long process of mining, shipping, and refining; in future, the company would be paid 90% of the mining and milling costs on the shipment of concentrate from the mine, 75% of the refining fee on the shipment of black oxide from the refinery, and the balance of the price on completion of a satisfactory assay of the final product. The company's finances were substantially eased as a result.30 The result, though gratifying, was not immediately comforting. There were no new contracts to apply this splendid principle to,

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and that circumstance, combined with the diminution in grade and the failure to find new ore sources or reserves, provoked a new crisis in Eldorado's affairs. V

When Bennett and Haydon worked out the sums for Eldorado's 1946 performance, they discovered that while the company's $405,000 deficit was depressing, it was more than compensated by a number of windfalls, all of which, unfortunately, did not begin to show up until the first quarter of 1947. The Corps of Engineers' contract renegotiation was the prize, but there was the settlement with Pregel and the recovery of radium and money from the Union Miniere ($206,000 and 2.3 grams of radium) as the company's share of cartel and clearing-house activities from before the war. If these were added together they produced a surplus of $644,328. However, it was obvious to Bennett that this would not be enough to finance the several programs that were urgently needed if the company was to get on its feet. The mine development program and the mill improvement program would undoubtedly be costly and it was also necessary that the budget for exploration should be increased substantially if the company hoped to replace its existing deposits at Port Radium with new deposits found elsewhere. The absence of any commitment from the Americans as to future purchases raised at once the question of future operating policy at Port Radium. Bennett discussed the question of operating policy with his board, his minister, and George Bateman. Bateman, in a letter to Howe in mid-January 1947, summarized the position. The company could, he wrote, assume an annual production of 200 tons of uranium oxide, costing $10 per pound or $20,000 a ton. While such a rate of production was feasible, it would 'mean the fairly rapid exhaustion of the mine' at Port Radium. And, Bateman, reminded Howe, when Port Radium petered out there would be nothing to replace it as far as Canada was concerned, something to consider if you believed, as Bateman did, that 'an important factor in Canada's position in atomic matters is due to our being considered a secure source for the supply of raw materials.'

i9 2

Eldorado

Bateman did not wish to see Canada's only uranium source used up in this way, even if the product was stockpiled and hoarded for Canada's possible future use. Far preferable, though only marginally cheaper, would be a stretch-out at the mine, halving production, and selling the result to Britain and the United States, 'reserving sufficient for Chalk River.' Bateman followed up on his advice with a personal interview in which he and Howe discussed the possibility of closing down the mine while keeping up 'development work for twelve months.' That idea appealed to Howe 'from the long-run viewpoint, even though it will badly upset the finances of the company.' That would mean turning to Parliament for a special appropriation, but under the circumstances, that would not be an unreasonable thing to ask. Implicit in this alternative was the abandonment of any idea that Eldorado would be run as a commercial company; instead, the company's strategic role would be held to justify government expenditure with no immediate hope of any return.31 There were in fact four options for the company's future. Things could go on as before, which in Bennett's view was 'undoubtedly the most satisfactory course' from a financial standpoint. The Americans would probably buy the product, but after two years there might be no product to sell. There was, Bennett proposed, the possibility of cutting back the rate of production, which would raise unit costs to a point where potential customers might be deterred. Their co-operation would therefore be essential if this course were to be adopted. There was the possibility of concentrating on development alone, which Howe favoured. If that happened, revenues would dry up, the refinery would eventually have to close, and $1 million a year would have to be found. Lastly, Eldorado could produce as before, but for Canadian account: in short, for stockpiling.32 On 31 January 1947, a committee of Eldorado's board was struck with Bateman sitting in as a representative of the Atomic Energy Control Board. The committee was unanimous in its recommendation that operations at the mine should be continued. However, it made alternative proposals with respect to the rate of production. First, it proposed that the mine be operated at the maximum economic rate with the government undertaking to finance produc-

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tion that might have to go into a stockpile. The other alternative involved production at a reduced rate in the event that the government was not prepared to finance the cost of a stockpile. The committee was also unanimous in its recommendation that the mine development program be maintained at a high rate. Bennett informed his board on 26 March that the report had been forwarded to the minister and that the minister had indicated to him that he favoured the first alternative, that is operations at maximum economic rate. The minister, however, had made no commitment with respect to government financing of a stockpile. Bennett also informed the board that a brief incorporating the discussions and findings of the committee had been submitted to the Atomic Energy Control Board. The AECB had discussed the matter at a meeting held on 15 March and had advised Bennett of its concurrence with his own recommendation 'that production and refining should be continued at the present rate.' As justification, the AECB referred to the well-known danger of flooding at the mine. As for the uranium's destination, it was argued that stockpiling was the best course, so that uranium could 'be conserved for the advantage of Canada.'33 This was of course a point of high principle. What the AECB did not add was the fact that Canada's ore had, at present, no takers and that if Eldorado was to continue producing, the government would have to buy its product. It helped that uranium was scarce and dwindling, not only in Canada but around the world (or so the CDT believed it to be), but it is unlikely that that fact alone would have stimulated the board to make the recommendation that it did. For at exactly the same time Bennett, with Howe's knowledge and sceptical consent, was trying to strike a deal with the British for the sale of 50 tons of Canada's rare oxide. The initiative was Bateman's. In the spring of 1946, he had expressed himself'strongly in favour of arranging the supply of, at any rate, small quantities of Canadian raw materials to the U.K. without delay.' Bateman followed up with a visit to Britain in August. On that occasion, he informed a British official 'that Howe had left the matter more or less in his hands and he gave me a semi-official assurance that the Canadian Government would agree to the supply of fifty tons per annum.' The price would be

!Q4

Eldorado

reasonable, since Eldorado did 'not reckon to do more than recover their production expenses' - something that (as we have seen) Bennett at that point devoutly hoped he could extract from General Groves; $4 or $5 were the prices that Bateman mentioned.34 Howe repeated the assurance of supply in a letter on 11 December 1946, adding that the Americans were pressing him hard to give them a further contract — an overstatement if there ever was one. This news stimulated London to send over two accountants to Canada to try to discover Canada's uranium price. These two individuals, together with a Washington-based British supply official, travelled to Ottawa with the idea that they would sit down and examine Eldorado's books and offer a just price based on that audit. That was not Bennett's idea of a proper commercial negotiation. He had just gone through the humiliation of supplicating American goodwill, at the cost of opening his records to his customers' scrutiny. He was determied never to do so again. Nor could he, as the head of what he hoped would be a profit-making commercial enterprise, concede that only direct production costs be applied to a contract. In this case, he was not enamoured of the 'no-profit-no-loss principle' as a basis for doing business. The result was a collision between two diametrically opposing viewpoints. The difference was expressed in the expectations each side had of price. The British expected a quotation between $4 and $5; Bennett asked for $12.50 per pound of oxide. This was close to the $10 figure suggested to Howe in January, but it also included a margin for exploration, and for profit. The British delegation naturally protested, but when they added on a request to go over the books, Bennett refused point-blank. He could tell the British what his price was, and what went into it, but under no circumstances would they see his books. Under the circumstances, it is gratifying to note that the British did not find the experience of dealing with Bennett unpleasant, disappointing as it must have been. The British were themselves no mean negotiators, and encountering an opponent who was prepared to be Very frank and open but firm,' in their words, was on the whole a happy experience. Bennett gave the British 'a very clear picture of the Company's general activities,' not omitting 'their difficulties,' which were many. 'He was very accommodating

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in accepting any proposed amendments, but immovable as regards price.' Bennett's subordinates seem to have impressed as well; Al Ross, Pochon's successor as refinery manager, was described as a 'pleasant, and apparently capable, young man.' Harry Haydon, secretary-treasurer, was rated 'a very shrewd individual, but genial and helpful.' All three men, the British reported, 'gave an impression of honesty and goodwill which must, apparently, serve as a substitute for the "open books" which we had hoped to find.'35 The important point was that, as of mid-February, the Canadians were willing to sell, at $25,000 per ton or $1.25 million for the lot. For dollar-poor Britain, that was major expenditure, especially when it is remembered that Congolese uranium was going for between $4000 and $6000 per ton in dollar-equivalent Belgian francs. The question thus became a political one. Canada could, possibly, give security of supply — as long as Canadian uranium supplies lasted. Canada would be firmed up as a supplier, and some small amount of Canadian goodwill could be expected. But was this enough to justify spending over a million Canadian dollars? The answer turned, finally, on another question: how annoyed would the Canadians be if the British politely declined? The last time the British had suggested an alteration in standing arrangements over uranium — in the case of the Anderson-Groves memorandum and the CDT - Howe had been highly displeased, and his temper was not improved by his simultaneous disagreement with them over the British contribution to Canada's ongoing reactor program. The Dominions Office and the Foreign Office seem to have thought that a repetition of that experience was both highly probable and highly undesirable, while the Ministry of Supply, though convinced that Eldorado's figures were realistic, argued that the price was too much to bear. The British high commissioner in Ottawa therefore sounded Howe out. The news he sent home was better than expected. Howe was not at all perturbed, and cheerily assured the British that there would be absolutely no hard feelings at all. Relieved, they retired from the field.36 It is possible to speculate on Howe's easy acquiescence. It is more than likely that he, too, was relieved, perhaps because he had come, over time, to regard the British as unreliable partners. They would,

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Eldorado

in his view, take any way out of a deal, and leave the Canadians to pick up the tab. As we shall see (below, p. 393) this was not the product of momentary frustration or very recent experience, but a conviction that Howe would have for the rest of his life. It was not confined to the British, of course. The Americans, as Howe knew, had more money, and that made it easier to deal with them. Since they possessed an abundant margin for error, the Americans were not so close with their money, or as unreliable as long-term partners. But even there Howe believed that it was dangerous to put too many Canadian eggs in one basket, and to leave Canadian uranium hostage to American fortune. But where Howe believed that the British would welsh over a matter of $1 or $2 million, the American trigger was much higher — $20 million, or possibly even $200 million. As we shall see, by the mid-19505 Howe was anxiously applying the same sceptical scrutiny to the Americans that he had previously used with the British. Later that same year, Howe visited the United Kingdom. Most of his functions there were pleasantly ceremonial, but a little business was mixed in with the official tourism. Asked about Canada's atomic energy program, Howe replied expansively and optimistically. Even radium sales, he told his hosts, were high, 'vastly in excess of pre-war sales.' Admittedly Eldorado had given trouble in the past, and had once been 'in a bad shape both physically and financially when taken over. They had,' he continued, 'by now put it into good shape.' Howe was speaking in August 1947 and he was, basically, right. Eldorado was getting into better shape, both physically and financially. Radium sales were high although, as we shall see, only temporarily. Best of all, Eldorado's uranium was going to be sold, at a good price, to the Americans.37 VI

Eldorado was still in business in 1947 because the military requirements for Canadian uranium, and uranium of any description, had not diminished. The discussions at the UNAEC had patently failed, even though they carried on, in maimed form, until 1949. The Russians were working as fast as they could on an atomic bomb of their own, and the British, in default of useful American aid, were doing the same.

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The structure as well as the future of Eldorado was bound up in the success or failure of efforts towards international disarmament. It was possible, in the unlikely event of a satisfactory and enforceable outcome to the UNAEC talks, that the Canadian government would have kept the company going in order to feed what was becoming Canada's own peaceful nuclear power program. That had been one of the considerations set before C.D. Howe at the beginning of 1947, and he had appeared, briefly, to favour it. By the middle of 1947, however, the prospect and the idea were gone, superseded by the fact of sales to the United States and a rising tide of optimism in Eldorado's affairs.38 The sense of opportunity that had engaged the attention of External Affairs' diplomats, and which had led to the creation of the Atomic Energy Control Board in 1946, was also beginning to ebb by the middle of 1947. Stalemate in the UNAEC was matched by more and more stringent Soviet control over its western borderlands. In the name of security and socialism, pro-Communist regimes were becoming overtly Communist, while at the United Nations, Western and Soviet delegates traded abuse and fostered mistrust. As a result, Canada's bifurcated policy - one strand looking to international co-operation and a broader political control and context for Eldorado, the other pointing to continued and close co-operation with the Americans and British in the weapons arrangements of the war — became more and more difficult to sustain. It was the second strand that would predominate, and with it Eldorado's political base was assured. It remained to be seen whether the company's physical capacity could match it.

6 Mines and Money

Between 1947 and 1950, and for many years after, Eldorado made money. From a deficit of $400,000 in 1946, Eldorado moved in 1947 to a profit so large as to convert the deficit into a sizeable surplus. Income, which in 1946 was under $700,000, touched $2.2 million in 1947. Current assets rose, current liabilities shrank, and working capital (the difference between current assets and current liabilities) grew almost exponentially. It became possible to think of voting a dividend — the first in the company's 24-year history — and in 1950 the directors celebrated Christmas by doing just that. C.D. Howe was gratified. The company's achievement in moving from financial paralysis to rude health in the space of three years can be attributed to a combination of factors. There was a reasonable allotment of luck. Talented people were found for the right place at the right time and in this, management enjoyed a measure of good fortune: Eldorado would boast a whole new generation of active, enterprising, and generally very young managers and executives. Ingenuity played a role in the success of Eldorado's engineers, scientists, and technicians, and helped solve costly problems in the extraction and processing of uranium. Underlying it all, however, was skill in negotiations, which sold the company's products and secured a constant flow of American dollars into the company treasury. To make money Eldorado had to spend money. There were considerable capital investments. Some helped production directly

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by improving the grade of concentrates shipped south, or through discovering new sources of usable ores. Others helped indirectly, by improving safety at the mine and the refinery — changes that were badly needed by 1947. The future had to be provided for, as in any prudent mining company, and so large sums were spent on exploration; inevitably, much of this money went unrequited. The company was also able to find funds to put into research and development aimed at making better use of what the company already had, thereby expanding the definition of what could be economically mined. It was an additional sign that Eldorado had established itself as a successful, commercially oriented company. Eldorado nevertheless had to operate with constraints that were distinctly not designed or conceived with profit in mind. Atomic energy was a hot strategic item, and it had been placed under the Atomic Energy Control Board which, at the beginning of 1947, was still acutely interested in how Canada's uranium business ought to be regulated. Because of security, uranium, like other atomic matters, was still a government monopoly, and it was up to the AECB, under its formidable chairman, General McNaughton, to establish the required regulations. To assist McNaughton, and to advise the cabinet, there was still the Advisory Panel on Atomic Energy composed of senior officials. Its influence was in decline during 1947, but it still took a lingering interest in the impact of Eldorado's uranium sales on the conduct and success of Canada's international relations. The failure of the UN discussions during 1947 had the effect that the Department of External Affairs most dreaded. Within the very broad, and generally agreed, ambit of support for the common defence of the West, part of Canada's foreign relations was compartmentalized and fenced about with secrecy, security, and specialized knowledge: atomic energy continued to be part of C.D. Howe's bureaucratic realm. It could not be argued that Howe was acting against Canada's foreign policy, merely that he and his officers were operating independently of it. This autonomy allowed Eldorado to operate as a commercial company; other government agencies or departments would have virtually no say in the way Eldorado conducted its business, including its contacts with its British and American counterparts.

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The American counterparts were the ones who counted commercially, although close contacts with the British were maintained in technology. The United States had organized its atomic interests under the umbrella of a civilian Atomic Energy Commission, which we shall dub the USAEC, to distinguish it from its UN namesake. At the top sat five civilian commissioners, responsible for advising President Truman on atomic policy and for keeping jealous Congress informed of what it was doing. Under the commissioners dwelt a general manager, and under him a gaggle of directors, scientists, and technologists struggled with one of the largest peacetime budgets ever granted an American civilian agency. One of the designated targets for its expenditures was uranium. I

Uranium was still scarce. The United States, between 1947 and 1950, depended on two, and only two, sources of supply: the Belgian Congo and Canada. There were other suppliers in the offing, particularly South Africa, but for the time being the Americans had to rely on what they already knew they had. What they had, however, was mostly shared with the British. The Combined Development Trust (CDT) had handily survived the renegotiation of its mandate at the end of 1945, and through the trust the United States was committed to share the uranium purchased from the Belgian Union Miniere. Canada, being outside the trust, therefore offered the United States another advantage, in addition to geographical proximity and political reliability. The United States could buy Canada's entire output of uranium and sell back the 18 or 20 tons of uranium metal that Chalk River consumed. It did not make long-term sense for the Americans to rely on only two mines, and it became part of the USAEC'S duties to search for uranium and to encourage others to join the search. To produce uranium in North America was costly, though possibly not as costly as the operations at Eldorado's subarctic mine. Either the government would find ways and means to mine its own ore, or it would establish incentives to encourage others to do the same. In the meantime, the Americans were not about to force down the

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price of Canadian uranium lest by doing so they should close down the entire Canadian uranium enterprise. American negotiators accordingly approached negotiations with Eldorado in a cordial and forthcoming frame of mind. American anxiety over uranium supply may seem surprising, in view of the fact that the United States had been producing atomic weapons since 1945. That fact, widely publicized, gave an impression of strength; only a very few knew that, as of April 1947, the United States had only seven usable weapons in its atomic stockpile. It followed, so Truman was told, that the rate of bomb production could not be reduced 'without an adverse impact on the national security.' National security in turn required 'preemption of as much as possible of world production of uranium,' in the view of the Atomic Energy Commission. And so the road to strategic safety, not to mention atomic superiority, led to Eldorado, and when it did, Bennett was waiting.1 In negotiating with the Americans, Bennett had a large advantage. George Bateman sat on the CDT, and Bateman regularly reported the state of the CDT'S view of uranium supplies. Projected American uranium needs outran projected supply. For example, the Americans estimated that they would need 2547 tons of uranium in 1948. Estimated Union Miniere supply that year was 2200 tons. It was possible that the United States could produce 100 tons domestically, and possible that Canada would be able to export 150 tons, but there would still be a shortfall of almost 100 tons. All this was exclusive of British demands, but fortunately the British had a stockpile that in Bateman's estimate would last until 1952. It could be assumed that a deficit of only 100 tons could be met without great strain, and in the event it was. But for 1949 the geologists had dismal news. That year, they thought Congolese production would descend to only 1200 tons, as the great Shinkolobwe mine began to peter out. As we now know, they were wrong, but their estimate had to be taken seriously. Such a prediction gave importance to Eldorado's comparatively small output and helped to guarantee that the United States would do anything within reason to keep the company's mine open and unflooded. The experience of 1940—2 was still fresh and depressingly explicit.2 At the same time as American fears for their atomic bomb

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program were mounting, negotiations opened between Eldorado and the USAEC for the purchase of 50 tons of uranium. This was the same amount that Eldorado had contemplated selling to the British, and it was offered at the same price, $12.50 a pound. The components in this price, Bennett explained to Phillip Merritt in April (Merritt had switched over from the army to the USAEC in January), included mining, milling, development, and exploration at Great Bear Lake, $6.56, freight, $1.00, and refining, $2.45. It also included depreciation at the mine and the refinery, a special depletion allowance, and a 10% profit. The price of $12.50 was a considerable advance over the $6.17 price that Merritt had approved the previous December on behalf of General Groves. Merritt accepted it as realistic, as the British had done two months earlier. It was not so much the price that was important, however, as the fact that Bennett was offering a 'fixed price' rather than a 'cost' contract as before. If Eldorado improved on its performance, the benefit would accrue directly to the company. Nor would Eldorado have to establish its costs to the last penny as would have been necessary had the contract been a cost-plus contract. The USAEC did not quibble over profit; but it did hesitate, momentarily, over the price. The discrepancy between Eldorado's quoted price and that offered by the Belgians was very great. The Union Miniere with its richer and more abundant ores was charging $2.75 per pound of oxide, or 80% below Eldorado. Merritt, writing to the USAEC'S general manager Carroll Wilson, unequivocally recommended acceptance, and for three reasons. First, 'It is to our advantage to procure foreign ores when available and thus conserve our domestic uranium ore in the ground insofar as possible.' Next, Merritt wrote, 'The uranium is needed to meet requirements' - in other words, the United States program did not have enough uranium to fulfil its bomb-production program. Finally, and here Merritt spoke as a mining professional familiar with developments at Eldorado, 'metallurgical research holds out a definite hope that, at some time in the near future, costs of black uranium oxide will be materially reduced ...'A little seed money now would produce dividends in savings later. It was even worth sweetening the American reaction by offering to speed delivery of uranium metal

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rods needed at the Chalk River reactor in order to wrap up the Eldorado contract.3 On 6 May 1947, the USAEC accepted Merritt's arguments and approved the contract. Final signature, however, did not take place until the fall, and when it did everything had grown. The price was up, from $12.50 to $ 13.50, reflecting the lower grade of Eldorado's ores and the consequent increase in costs. The quantity was up too, from 50 tons to 150 tons, a whole year's anticipated production. In total the Americans would pay over $4,050,000. The payments would be made in accordance with the new procedure agreed to in the renegotiation of the last contract — 90% of the mine costs on the shipment of concentrates from Port Radium, 75% of the refining fee on shipments of black oxide from Port Hope, and the balance on the completion of assays at the point of final delivery. Since there was sufficient mine concentrate in inventory to meet the requirements of this contract, a payment of $2.6 million was received covering 90% of mine costs on the signing of the contract. The margin of profit, Bennett advised Howe, would make it possible to amortize the full costs of the exploration program under way in the Lake Athabasca area.4 Contracts for the next three years followed the pattern set in 1947. In November 1948, Eldorado contracted with the USAEC to deliver 500,000 pounds (250 tons) by December 1949, at a price of $15 a pound, for a grand total of $7.5 million. Three more contracts were signed, covering production down to 1952, for prices up to $15.51 a pound. Deliveries in 1948 were 206 tons; in 1949, 217; and in 1950, 235. As a result of the intensive development program that began in late 1947, Eldorado's ore reserves had proved to be greater than previously anticipated; but they were also a small and declining percentage of total American procurement. In 1950, for the first time, American domestic production of oxide surpassed Canada's; at the same time overseas production, from the Congo and South Africa, continued to grow, disproving the gloomy forecasts of the CDT'S geologists.5 As a result of their eclectic ore-buying policy the Americans faced some minor embarrassments in their dealings with the Belgians. The key negotiator for the Union Miniere was still Edgar Sengier. Fortunately for the United States, one observer reported,

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Sengier was 'devoted to American ideals, hating Russia like poison.' Sengier's political convictions overrode his highly developed competitive instincts and as a result he does not seem to have objected to the disparity between his price to the United States and that asked by Eldorado. All that he wanted, he told a u.s. diplomat, was an assurance in writing that 'the price paid for Belgian uranium is as good as the price paid to other suppliers.' What that meant was 'profit margins,' as the diplomat explained, 'since price paid for Canadian and domestic production is considerably higher to compensate for higher operating costs.'6 Sengier may well not have had the information necessary to compare Canadian profit margins with his own; neither did the CDT, and certainly not the u.s. State Department, whosejob it was to funnel Belgian discontents, which were mainly political in origin, to the appropriate authorities. It helped that the Union Miniere's ability to supply ore, great though it was, was insufficient to American needs, both short term and long term, and that the Americans felt themselves obliged to deal with as many producers as possible, at whatever cost, and whatever price. Eldorado had stepped into a seller's market, and as long as the company had uranium to sell, it would have a customer ready to buy. II

Eldorado's continuing ability to produce uranium started at the mine. There, the reader will remember, the manager and his staff were reported sunk in gloom in the summer of 1946. Almost everything was going wrong: ore was running out, ore grade was plummetting, production fell to its lowest point since reopening, equipment was regarded as inadequate, the mill superintendent quit, and, to top it off, the mine was now asserted to be unsafe. It was not unsafe for any of the familiar reasons. The pumps kept the lake out of the mine, repairs shored up the consequences of water damage, and heaters kept the miners from freezing at least in the upper levels of the shaft. Unfortunately, the company was faced with a safety problem of a different kind. Radioactive ores exposed to the air produce radon gas. Radon gas gives off alpha particles; and alpha particles can lead to an excessive

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exposure to radiation. Radon gas would not in ordinary circumstances have posed a threat, but two conditions at the mine contributed to its incidence. First, the mine was not particularly well ventilated, and secondly, its ventilation ducts were sometimes stopped up to keep cold air out and warm air, heated by portable electrical devices, in. At the beginning of 1945, the Montreal research team sent in two scientists to do the necessary measurements of radiation in the air since the necessary skills could not be found at the mine. Security may also have dictated that only those already in the know could be used; if so, the result of this expedition must have been rather unusual, since the two investigators, Allan Nunn May and Bruno Pontecorvo, both later proved to be Soviet spies. That circumstance did not affect the validity, or the alarming content, of their conclusions. The Port Radium mine had a very high concentration of radon gas. According to F. A. Paneth of the Montreal laboratories, 'the radon content seems to be so high as to be definitely dangerous to the health of those working in the mines.' It was, in his words, 'a very serious industrial hazard" for which ample precedents existed, the most notable of these was the St Joachimsthal mine, whose radon concentrations equalled those found at Eldorado, and where it was 'known that about 50% of the miners have eventually been dying of lung diseases.'7 It was not news to scientists working with radiation, but it was news to mining engineers used to working with or in ordinary mines. One of Eldorado's own mining engineers, James Houston, had tried to refute complaints from miners that the air at Port Radium was unhealthy by pointing out that in 1944 he had twice visited the mine and 'been underground a number of times. Mining conditions at Eldorado are similar in every respect to other mines in Canada.' Indeed, he wrote, 'the ventilation at Eldorado is as good as the average mine in other parts of Canada.' But Eldorado was not an average mine, and its product created hazards unknown in any other Canadian mine.8 A further on-site investigation occurred in August 1945. It pointed out that 'there is a relatively small amount of air circulating through the mine,' and noted that the 'throttling' of air intakes made the situation all the worse during cold weather. Improve-

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ments followed, but their effectiveness is still a matter for debate. It is certainly true that air circulation was never again as poor as it had been during the war and before; air sampling began; tests were run; and hazards were monitored as far as existing knowledge permitted. Yet some doubt remained, and remains still, that the mine was an unhealthy place. But underground conditions at Port Radium were never pleasant. Lesslie Thomson, visiting in September 1945, found the atmosphere underground 'extraordinarily damp and raw,' and found himself at times walking through 'two to five or six inches of fast flowing water. Occasionall such streams covered the tracks of the mine runways.' If the men were unhealthy, and Thomson noted 'a peculiar cough,' it could well be, as the mine doctor argued, that it was just 'low temperature and high moisture.' This was a reasonable conclusion under the circumstances. Though worried, Thomson took comfort in taking advice, and the advice he had was that 'fans, motors and the like,' ordered in October 1945 and delivered at the railhead the following May, would make Eldorado 'one of the best ventilated mines in Canada.' So the company believed, and in fact the improvements in ventilation were so evident that such doubts as remained were stilled. Monitoring continued, using newly developed standards of radiation tolerances, and alarm subsided. The mine manager's report for 1946 found it unnecessary to mention radiation hazards; and perhaps this was because there were so many other, and graver, problems on the manager's mind.9 As noted previously, the most urgent problem was the mill. With the decline in the grade of ore available, mining recoveries dropped sharply with resulting increases in costs. As we have seen, Bennett had sought the assistance of C.S. Parsons, the director of the Bureau of Mines, and he, in turn, had engaged Dr A.M. Gaudin as a consultant. In visiting the mine, Gaudin worked with Bolger and Dick Murphy, the director of the exploration program and the company's senior geologist. Gaudin's report was not the only one, but it was extensive and detailed, and is the best surviving description of Port Radium in 1946. There was no problem with Murphy, Gaudin happily reported.

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'His lecture — if I may use the term — was most helpful,' the visitor wrote. It was none the less evident that geology was not being used to best advantage. Underground miners used appearance alone to distinguish between ore and gangue (the matrix in which ore was found; for our purposes, waste rock). Surely, Gaudin suggested, a better method could be employed, and one was at hand: the assaying of rock samples. Unfortunately, assaying at the mine was an undeveloped art, and such assaying as was done 'left much to be desired.' That had not mattered when Port Radium was a high-grade mine. Now it was a low-grade mine, and humbler, slower, and more careful procedures would have to be followed. There were implications for milling as well. Hand-cobbing was still the first stage of the milling process, relying on quickness of eye and hand to identify and select richer chunks of ore as they passed into the mill. To prove that this was unreliable, Gaudin tried a small experiment. First he selected from the mill's conveyor belt 'a number of lumps of as diverse a character as possible. After washing these lumps and arranging them according to structure, color and heft on a well lighted window sill I asked [the mine geologist] to give me his idea of their uranium content. He graciously complied, but naturally was hesitant about a number of them. My point in this,' Gaudin concluded, 'is that even under ideal conditions the most expert individual must be in doubt — a condition that would be true with any ore, but more particularly with that of a mineral which is so inconspicuous as pitchblende.' Hand-cobbing was only the first, and possibly not the most important of the mill's difficulties. Gaudin could not tell whether waste was really waste; assay results differed wildly from one another. 'How well is the mill doing now?' someone might ask, and not receive an accurate answer. To get one, Eldorado would have to spend some money. Geiger counters were available, and some were in use, to detect radiation, but they needed specialist handling for both operations and repair. Such a specialist would have to be hired and assigned to the mine. Other specialists were needed, too, to establish a proper chemical laboratory and what Gaudin called 'a new analytical building.'10 The next visitors to Port Radium had a clearer and greater

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responsibility for advising on the mine's and the mill's future. C.S. Parsons arrived with a young assistant, Dr Chris Lapointe, in tow. Parsons, after making a quick inspection, headed off to report to Eldorado's board; Lapointe started work on the first of the technical improvements to descend on the mine, an ore scanner and picker which would be given his name. A Geiger counter would identify high-grade ore, while a mechanical arm swept the stuff off into a bin. Lapointe had an eccentric and rather demanding personality and he cut a considerable swath through the quiet Port Radium community. He left behind a divided opinion on his picker. Was it a work of genius, regardless of the problems that attended its creation, or was it a clever but expensive and impractical Rube Goldberg machine that broke down as often as it worked and required constant tinkering to keep in motion?11 While Lapointe presented Eldorado with his own version of the eccentric scientist at work, Parsons headed back to Ottawa, and it is Parsons who would be the key to the developments that now followed. Not only were Eldorado's mill procedures defective, Parsons realized, they had produced a huge deposit of tailings dumped in lakes and ponds around the mine. These tailings had ore in them, and they held out the hope of extending the mine's useful life. While Port Radium settled in to another long winter, Parsons began to organize its future. To do it, he assembled a team of researchers and scientists, who collectively became the Eldorado Project. The first head of the project was J.S. Godard of McGill University, and the team included Lapointe, Paul Gishler of the National Research Council, H.W. Smith, W.A. Gow, and E.A. Brown, each representing a particular branch of mining knowledge, as well as chemistry, physics, and metallurgy. Gaudin, from the distance of Cambridge, worked with the group as its senior consultant. When Gishler (who had succeeded Godard) departed, it was Gaudin who recommended the third head of the Eldorado Project. Arvid Thunaes, a Norwegian, was a trained metallurgist who had come to Canada early in the 19205, and who had worked for Cominco in British Columbia before taking on a job working on 'the complex tin ores' of Bolivia. Back from Bolivia he came, at Gaudin's instigation. The two were old friends, and the 'close personal

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association' between the two men 'kept the exchange of ideas constant,' as a Mines Branch historian put it.12 It was, of course, in the Mines Branch that the Eldorado Project was located. The company paid the project's expenses, and the Mines Branch organized it and battled to keep it alive and functional. Like every other government department in Ottawa, Mines and Resources was short of funds and poorly housed. Its staff stayed on as an act of devotion as much as anything else, since the technical and scientific servants of the Government of Canada were notoriously poorly paid compared to their counterparts in private industry. While Thunaes and his staff pondered how to extract more uranium from Eldorado's pitchblende, Parsons, who was described as 'slight, energetic, knowledgeable and often peppery,' fought their battles with his own department, and represented their efforts to the Eldorado board. The board, and Bennett, too, were grateful to Parsons and to Gaudin, whose choice of Thunaes they came to consider little less than inspired. 'I have special reasons for expressing my gratitude to you,' Bennett later wrote to Gaudin, after the consultant's work was completed. In 1946 he had been 'confronted with a veritable host of troubles, not the least of which was the unsatisfactory condition of our mill performance, both from the standpoint of recovery and of control. Your decision to accept the direction of our research program gave me an assurance which was very much needed at the time.'13 The assurance that a solution was possible, or at least conceivable, helped see Eldorado through the difficult year 1946—7. The whole mining industry relied on the Mines Branch for advice, and Eldorado was no exception. The simultaneous transfer of the company's offices to Ottawa and the establishment there of the Eldorado Project indicated an emphasis on science and technical expertise that was new in degree. New, too, was the closeness between the company and the researchers doing its work. In the 19305 the metallurgists at the Mines Branch had treated Eldorado as one company among many, as their work obliged them to. For the first time, starting in 1946, a Mines Branch group had the exclusive task of servicing Eldorado's needs. It was the beginning of an autonomous research and development division, called forth not by any abstract conception that 'R&D' was generally good and

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meritorious, but by the necessity of developing a technical solution to urgent metallurgical problems, without which the company could not easily survive. Ill

As research got under way in Ottawa, other changes took place at Port Radium. The first was the departure of Ed Bolger, the mine manager. Once a successor was picked, Bennett offered Bolger the post of technical adviser to himself and Bolger, though shocked and surprised, accepted it. It was a retirement posting, and in the fall of 1947 Bolger reluctantly left Port Radium to assume his new duties.14 His successor had dual responsibilities. Bolger was not the only senior personnel switch in 1946—7. Dick Murphy, the head of exploration, also decided to leave. To replace him Eldorado needed a qualified geologist, and Bennett, James, and Williams decided to kill two birds with one stone. Dr E.B. Gillanders, with a doctorate in geology from Princeton, began his career as a geologist. He had later turned his interests to mine operations and was at the time a mine manager in northern Quebec. He looked to be a natural choice for manager at Port Radium too. It was rumoured that Gillanders had broad authority to make changes, and personnel statistics indicate that he took his mandate seriously. As the 1947 Annual Report noted, 'Substantial savings were effected in mine operating expenditures in the latter part of the year through the reduction of operating personnel. The total mine personnel as at December 3 ist 1947 was 213 as compared with 253 as at December 3151 1946.'15 The departure of 15% of the work-force was possibly the most painful change at Port Radium; the savings helped make the operation leaner but not, for those who remained, less comfortable. It would be easy to exaggerate the impact of the departure of 40 workers. Given the 133% turnover in the work-force at Port Radium in 1946 and the 145% turnover in 1947, the departure of 40 more would not be as remarkable as it would have been in a more stable community. In the matter of turnover, Gillanders had

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little immediate impact: it remained at what the 1948 Annual Report called an 'excessively high' rate of 137%. There were various reasons for this. There was very little unemployment in Canada between 1945 and 1950. Miners were in high demand, and wages were rising. Port Radium was the most remote and isolated mining community in the entire country, and the one with the worst climate. Many were reluctant to go there; of those who did, some turned around and demanded to fly out on the same plane that had brought them. The company tried to combat this tendency by providing an incentive - if an employee worked for 350 shifts, the company would pay his transportation expenses from and to his place of hire. As the figures show, however, this approach was not entirely successful. No one finally could be compelled to stay, and it was more trouble than it was worth to keep malingerers in camp. Those who had known Port Radium in the 19305 regarded the revived mine as a very distinct improvement. Before 1940, no women were allowed except the mine manager's wife. Other married men, even staff, were told to keep their families in the south, presumably because the appearance of wives and families was more than the company could bear administratively or financially. Bolger, when he returned to the north in 1942, permitted married staff to bring their families up, and the company built accommodation for them. It was crude to begin with, but there was a living room, bedroom, and kitchen, as well as a bathroom. As families grew, so did their houses, and larger apartments were built to house them. What ensued, as Bolger's report for 1946 pointed out, was 'further work on pipe lines' for heating and on septic tanks. Visitors had an easier time of it after the war. A staff and guest house went up on the hill overlooking the bay. Staff were still stacked two to a room, as they had been before the war, but at more senior levels there was hope for something better. For the married, there was the 'quadruplex,' four-unit upstairs and downstairs apartment buildings, and in 1947, as children made their appearance, two-bedroom apartments did as well. The baby boom was on everywhere in the country, and Port Radium was no exception.

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The first school opened in 1947, and with it a teacher made her appearance. A curling rink - necessarily indoors - was constructed the same year, the cookery expanded in 1948, and a 'soda and coffee bar' was established to cope with cravings for food and company outside regular cookery hours. To preside over the coffee bar, there was 'the coffee queen,' but by 1948 her position was not unique. Labour shortages brought female help to the cookery, to the great distress of the manager of catering who believed that good order and discipline depended on keeping unattached members of opposite sexes hundreds of miles apart. Yellowknife or, better still, Edmonton, were the proper places for single women. There was, in fact, considerable resistance to the idea that isolated miners could cope with the presence of females. The assistant manager reacted with horror and outrage to the news that one of his staff geologists had profaned a geological map with the locations of the trysting places of the young men and women in his charge. To combat this wild outbreak of immorality, he put together a working party, scoured the bush and made a pyre of pillows, blankets, and mattresses, with both miners and staff gazing mournfully on. Though there was sex at Port Radium, it was almost invariably discreet. Recruiting sometimes failed to spot the real intentions of incoming employees: occasionally professional prostitutes turned up, on the female side, and professional gamblers on the male. The rewards of vice were high, and for the females risk-free, since as soon as they were spotted — within days — they could expect a free and speedy trip back to civilization. There was, however, an element of risk for the professional card-sharp, whose safety could depend on how quickly he caught an outbound plane. (Readers are probably wondering if all sex was heterosexual, and to this question the answer seems to be a qualified yes. The consensus of opinion among 15-odd interviewees is that the miners would not tolerate homosexual activity; those few employees whose activities aroused suspicion were quickly moved out before trouble had a chance to start. Despite occasional flings at the mine, the principal beneficiaries of the miners' sexual isolation were women outside. In one case, a miner on furlough was said to have blown a year's savings on

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renting a week's exclusive use of a Tijuana brothel. The inhabitants are said to have thanked him warmly for their week's vacation.) Most gambling, however, was non-professional and continuous. Its focus was Number One bunkhouse, down by the water, and its practitioners were said to be the slaves of the three-shift system: one shift working, one sleeping, and one gambling. When one game left off, another took up. There was certainly profit in it: some miners left Port Radium comparatively rich men, with $25,000 jingling in their pockets; others simply signed on for another 300 shifts, since they had nothing to spend outside. Liquor was the other great consumer relaxation. Company policy granted its employees a bottle each, every month, brought in on the aviation division's 00-35. This gave a modicum of relief to moderate drinkers, and yielded large financial rewards to teetotallers. If they waited long enough, especially if freeze-up or breakup happened to be unduly prolonged, liquor prices could be astronomical. Under the circumstances, home-brewing was inevitable. Married couples, who had the space, usually had the brewmaster's privilege as a result. The product, through the fog of memory, was pronounced to be highly acceptable, and formed the basis of many a good party. No dinner party was without illicit beer in times of plenty, and sometimes dinner was graced by the presence of an equally illicit haunch of caribou. Hunting was illegal for mine staff, but game could be procured, either by the direct method of shooting it, or by purchasing it from an Indian hunter. It is of course true that the RCMP were present to enforce game and other laws, including those about drink, but mine veterans remember only one classic occasion when the mine mountie was tempted to enforce them rigorously. Any recent arrival, miner, mountie, or staff, was always hospitably greeted. On this occasion the mountie was entertained by the mine superintendent, the second-incommand to the mine manager, who naturally put his best foot forward, and served home-brew and venison. He found himself charged, and the mountie found himself ostracized. It was, presumably, a lesson to the constable and his successors not to take southern laws to a northern environment. There were events in which the entire camp shared. The highlight of the year was the celebration of Dominion Day, not out

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of fervent patriotism but because early July could be relied on to furnish the best weather. There was at least a hope that the first boat of the season would be in, and with it the best of the year's supplies. If the supplies were not always fresh, they were at least novel. Dominion Day was a moveable feast, which might be celebrated anytime between i July and i August. It shifted about a bit, between Cross Fault Lake east of the camp and a deserted mining property south of Port Radium (El Bonanza), which had a sand beach and more than the usual supply of flat land. 'The people were barged there and back,' Bob Jenkins, Port Radium's historian, has written, 'but it was so difficult to round up the troops for the trip home and a bit of a chore to keep some from falling overboard, that it was not held there again.' Later parties were held at McDonnough Lake, a tailings pond on top of the cliff, behind the mine. In summer there was baseball and tennis, for those who wanted to play, and in winter there was curling. Curling very quickly became the dominant sport; other sports which might have had more appeal further south proved impractical. Skating and hockey might seem natural, and an outdoor rink was duly installed with poles and lights; the men ordered in skates through the commissary and the company bought hockey equipment. 'When the ice surface was ready,' Jenkins wrote, 'there was one weekend of skating and one hockey practice before a blizzard drifted in the whole rink. When volunteers were lacking to shovel off the three feet of snow, the project died and the boards and poles and lights all sank into the tailings pond in the spring.' Curling it was, then. Everybody could join, both men and women. It could be played at all hours, and it was. 'Noise would emanate from the rink even at 1:00 a.m. as those coming off the night shift would hold challenge games.' There were regular curling league matches, and for the best Port Radium team there were games against the Yellowknife mines and an annual intracompany bonspiel against aviation and Northern Transportation. Baseball did not stimulate as much team rivalry, though there was an annual match between the veteran 'Old Crocks' team against the 'Young Crocks.' Though there were divisions in the mine, between functions,

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and preferences as to recreation and social life, the settlement was not large enough to sustain real distinctions and differences. There were readers who swore by the Book-of-the-Month Club and the regular deliveries of their favourite magazines and newspapers. Others got their entertainment from the radio, which as often as not reached the north straight from Moscow, mixing music with propaganda. The Signals Corps detachment of three men kept up emergency communication with outside, but it was functional rather than informational. Where people had a choice, Moscow radio was preferred to the Canadian Broadcasting Corporation's Northern Service, which Port Radium veterans remember today as being boring and irrelevant. Social life, after 1948, focused on the recreation centre. It was a measure of developments in personnel practice since the 19308 that Port Radium acquired a recreation director to preside over pool, curling, and dancing. Dancing provided an opportunity of a different sort, since dancing couples would usually require babysitters, a job that miners and staff competed for. In return they got privacy, a chance to listen uninterrupted to radio or records, and a supply of home-brew to be consumed at leisure. The settlement's appearance had not changed much since the 19305, except that it was now much bigger. All buildings were wood frame, insulated with packed sawdust and topped off with mine siding, an asbestos shingle resembling tarpaper. From a distance the white mine siding stood out against the red rock; closer up it made up in serviceability what it lacked in aesthetics. Port Radium was well north of the line of continuous permafrost; it sat, for the most part, on top of rock, and where it did not, it was necessary to be very cautious. As the Wallis had learned when their fireplace collapsed into a soupy bog in 1936, the ground had to be protected from the people, as well as the people from the permafrost. Houses and buildings had to be sited very carefully, in such a way as to allow the ground to remain solidly frozen. Basements were therefore out of the question; instead, each building sat on a crawl-space through which water, sewage, and steam lines ran. Outside the crawl-spaces, these lines ran through 'box lines,' insulated tunnels perched on trestles above the ground. Board sidewalks ran along and up and down the cliffs, and it was a sign of familiarity with the camp to

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know just how many steps it took to get from the clifftop to the shore. The most common reason for traipsing up and down stairs was to get to the cookery. There staff and miners dined separately, the staff in its 'Blue Room,' the miners in their own cafeteria, but the food was the same in both even if the Blue Room could boast a more clubby atmosphere. 'Meals were plentiful,' Bob Jenkins has written, 'but were made up largely of canned goods and dried foods such as potatoes, carrots, beans, peas and milk. The cook had to be resourceful in order to make the meals appetizing.' When the aviation division began to operate on a regular bi-weekly schedule, the mine was supplied with fresh meat and fresh foodstuffs except during the period of the breakup and the freeze-up. None of this would have been unusual in larger camps further south, but there was one point of difference. Port Radium consumed large quantities of liquids, particularly tinned fruit juices, a peculiarity which was ascribed to its desert-like dryness (precipitation at Great Bear Lake was between 5 and 10 inches annually, about the same as the Nevada desert). The cook most remembered from this period was Laurie Haavisto, whose specialties included vast quantities of home-made ice cream which he made in huge batches. Ice cream and other sweets were much in demand; calories were needed for the kind of work most men were doing. That helped account for one final oddity: despite the monotony of the food, there were very few complaints: exhaustion, hunger, and satisfaction went hand in hand for the miners. If food was not much of a problem, neither was accommodation. The bunkhouses were new, for the most part. Radiators at the end of each hallway in the two-storey bunkhouses belched out heat that fans directed down the hall towards the washrooms, which were located in the centre. The heating was fine in theory, but less than successful in practice: rooms close to the radiators were tropical, while those furthest away were barely habitable. Thermostats existed, but since everyone on the floor had his own idea of comfort they eventually had to be welded shut to protect them from nervous collapse. During the 19405, the company also supplied sleeping bags, which might have provided another means of

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temperature regulation, but it was too hot inside, and too cold outside. Doors and windows proved to be the only practicable way of achieving the proper balance. At least in the 19405, security was no great problem, and open doors were seldom an invitation to anything more than general society; in the 19508 doors acquired locks as theft made itself known at Port Radium. Clothing was not formal. Sylvia Donald, who arrived at the mine in the winter of 1949—50, remembered her first trip north. Hired in Edmonton, she was told to report to the Eldorado hangar with her belongings. Air travel in 1950 was still a comparative rarity, and therefore a special event. 'I arrived at the airplane in a ritzy little red suit,' she remembered. No one said a word. On departure she was hauled into the 003 and stuffed into a hole in the cargo area o among mine equipment and supplies strapped to the floor. After take-off, the co-pilot undertook to come back and ask whether she really understood where she was going and what she would need. Receiving the reply he expected, 'No, not really,' he drew a curtain across the hold and took refuge on the other side, while issuing instructions on what to wear, starting immediately. It was easier for men, who were used to wearing long Johns ('all wool ... warm,' according to Jenkins) and who also learned to wear Grenfell ski pants, designed for Labrador, and wool shirts. These the commissary stocked in plenty. Quantities were necessary because, as Jenkins observed, 'they had a shrink artist employed in the camp laundry.' Inside the mine, outer clothing was as before: oilskins, rubber boots, and helmets. One development at Port Radium may have made more of a difference than all the rest put together. Eldorado like other companies had a preference for veterans released from the armed forces. These young men had been out of the work-force for up to six years. Some had served in engineer battalions, working at what they were used to, such as tunnelling in the Gibraltar fortress. Coming out, they were eager if not anxious to put their minds to work, going to university if they had not already been, going to work if they had. The first of the veterans appeared in 1947: Ted Spice, who became mill superintendent. In 1948, Hal Lake, an army veteran, became underground superintendent, replacing Gilbert LaBine's »_/

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nephew, Joe Belec, and in the same year Jack Learmonth took on the job of chief electrician. Bob Jenkins, a navy veteran who came in 1946, and whom we have met as the mine's chronicler, took charge of the commissary in 1949. Doug Campbell, a young geologist, took over the geology department in 1949, the same year Harry Boynton joined the engineering staff. These appointments were only a fraction of the total hirings, even on the staff side, but these men had two characteristics. They were young, and they were committed enough to stay. Port Radium's morale problem gradually dissipated; and as more people stayed and learned to work together as a team, efficiency improved. There was a paradox in life on Great Bear Lake. Isolation helped, because it forced the staff and miners to act as a community. But the more closely Port Radium resembled a normal community, the better it worked. By the time the mine reached its full complement, in the early 19505, it had 28 family apartments, the mine manager's house, quarters for the secretaries, teachers, nurse, and kitchen staff. Marriages were no rarity, and whether they took place at Port Radium - where Sylvia Donald was married in July 1950 — or outside, they occasioned celebrations that involved the whole camp. Charivaries were almost competitive, each one more spectacular than the one before. One couple returned home to find that drawing their blind (cut off at the bottom) switched on a searchlight, while sitting on the bed set off a klaxon. While the klaxon blasted, a parade led by a bagpiper marched through the door. There were more professional entertainments according to the season. Summer was the geology season, and with the snow cover off the hills Campbell marched around Port Radium, drawing up the first geological map of the area. In winter, it was the turn of the mine. In view of the worries felt in Ottawa about Eldorado's reserves, more geological surveys were urgently needed to turn up more reserves. These were duly found, as tunnelling extended beneath the cliffs. The Ventures claims — a reminder of LaBine's carelessness in staking only three claims back in May 1930 — were exploited on a royalty basis as the mine extended east and north. Winter was also the salesman season. Mining equipment companies, particularly Ingersoll-Rand and Denver, sent up their

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representatives to sound mine managers on what they required for the coming year. The managers and staff listened according to a strict protocol — equal time to each one — and then decided whether they should try for a new capital expenditure in the next year's budget. The mine budget, as well as the budgets for every other division of the company, was brought forward to the board in December, since equipment purchases would have to be well under way if there were any hope of getting delivery into Port Radium in the next brief navigation season. The winter of 1949 brought a new salesman, for the Swedish firm of Atlas-Copco. What he brought was news of a new kind of drill, something that would revolutionize underground work. The Atlas-Copco drills had two features of equal importance. They were light, and they had exceptionally hard tungsten carbide bits capable of hard-rock drilling. Gillanders saw a multiplicity of problems coming within reach of a solution. There had been problems with labour turnover and consequently with inexperienced underground crews. This accounted for a heavy loss of time with the cumbersome Leyner drills then in use (see above, chapter 2). The underground crews were no more pleased with the Leyner drills than Gillanders was with the way they used them, and it is clear that conditions underground counted heavily in stimulating manpower problems. It was an endless, vicious circle. The Copco drills arrived during the year 1950, in what Gillanders called 'the most important advance during the year.' He listed the advantages that resulted: 'a direct saving of 4^ per foot drilled, as well as a greater advance, lower air and powder consumption, and more contented crews.' From both the company's and the miners' point of view, the basic advantage was that 'drilling is easier; it makes a one-man job of what may have been hard work for two men.' Time was saved, because the complicated Leyner equipment had taken ages to set up and dismantle. The time saved could be spent drilling. Better still, 'no truck is required for transporting the equipment away from the face; one man can easily carry the complete unit.' The new drills operated on an air-leg, an airoperated feeding device that supported the drill, directed it into the rock, and absorbed the resulting vibration or recoil. Because the new drill was smaller, it could be fitted into a more restricted

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space; at the same time, two drills could be used where only one had fitted before.16 Miners were attracted as well by the fact that more money could be made with the new equipment than with the old. Underground crews were bonused according to the number of feet of ore that were broken in any given shift; and savings on powder and fuses, which the men themselves paid for, were passed directly into their pay. 'The good producers made more money than the staff,' Roy Saunders recalled, Very consistently double the normal salary.'17 One final phenomenon at Port Radium is notable by its absence: a union. The Canadian mining industry was, by the 19405, heavily organized. The dominant union was the International Union of Mine, Mill and Smelter Workers, which during the war had slipped under Communist influence. It was inevitable that miners who had belonged to Mine Mill would be hired at Port Radium, and in September 1945 Bolger reported that an organizer had arrived. 'Understand organizing legal,' Bolger telegraphed head office, 'but not sure of our case.' The organizer enrolled 100 members, and departed. Strangely, however, the union got no further. In September 1946, Bennett reported to the board of directors that the Wartime Labour Board, which had jurisdiction over Eldorado, had denied Mine Mill's application for certification. Although the union was ready to try again, Bennett was determined that it would not succeed. There were, in fact, several ways of stopping it. Eldorado was a wholly owned property, completely self-contained. There was nothing else near it, nowhere else that anyone could live. Unless invited, visitors had no business being there, and by that definition any union organizer was a trespasser. There was no transport to the mine except Eldorado's. The Northern Transportation Company was not licensed to carry passengers and the company's aviation division was instructed not to carry passengers other than company personnel. Canadian Pacific Air, which ran planes to and past Port Radium, also agreed not to accept any passenger for the mine who was not either employed or invited. There were, at a slightly later date, a few minor incidents. Undaunted, Mine Mill once chartered a ski-plane and flew in, only to be denied access by the mine manager. On another occasion,

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company veterans remember, the organizer got inside and held a meeting, but his efforts came to naught. The reason that Mine Mill was unsuccessful is probably much more prosaic than anxiety over the arrival of a Communist-tinged union would indicate. The turnover rate among Port Radium miners was high; so were benefits and wages. A mine with 200 men was too small to justify a large and prolonged organizing effort, and Mine Mill was never able to mobilize enough resources to send a man up, and keep him there.18 Union or not, Port Radium had turned from a failing mine into a successful one. Social improvements - the result of a different company policy towards women and families, as well as a more generous and imaginative provision of recreational opportunitieshad founded a stable little community. Technical improvements in mining technology developed the mine and uncovered ore faster and cheaper, while geological exploration above and below ground kept ore reserves several years ahead of the terminal axe. IV

Changes were more perceptible at Port Hope than they had been at Port Radium. The demand for uranium during the war had triggered an expansion of the company's facilities, and the result was the company's second expansion since taking over the property in 1932. The expansion crowded more building and more rooms onto a narrow site, 300 by 600 feet. And on the site, the same processes went on that had been developed by Pochon back in the 19305. The dramatic events of 1945-6 had more of an impact in Port Hope than they had in Port Radium. Marcel Pochon was an honoured citizen of the town. After the charges against him were withdrawn at the beginning of 1947, he continued to live in Port Hope, even operating his own little laboratory until ill health forced him to give it up. In his place as refinery manager sat Al Ross, his assistant, and under Ross his two department heads, Pete Farmer for uranium and Jack Burger for radium. Ross's promotion was not greeted with unalloyed joy by everyone at Port Hope. Universally recognized as a hard and conscientious worker, he was

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also believed to be ambitious and hard-driving - hard on others as well as himself. It may have been that on some issues or groups of issues, such as labour relations, Ross's personality was not entirely well suited; compromise came to him with difficulty, and this characteristic would later influence his relations with other sectors of Eldorado. What mattered most in May 1945, when Ross took over from Pochon, was that he was efficient and indefatigable, as well as intelligent in perceiving what had to be done. What showed up first was not the usual difficulties with grade or impurities that had bedevilled relations with the engineers during the war, but a different, difficult, and dangerous situation. Health measurements at Eldorado — regular check-ups and the like — went back to the origins of the plant, and were carried on by the company doctor, Robert McDerment, under standards set by the Ontario Department of Health. There is no reason to question that these standards represented the state of knowledge of the day, or that undue perils which, under existing standards, might have been avoided were tolerated.19 Knowledge advanced with experience, and it became clear toward the end of the war that existing industrial practices at Port Hope were outdated. In the spring of 1945, measurements were taken at the refinery by scientists from the National Research Council; what they found gave rise to serious concern. Readings of radiation exposure showed 'very high' levels, in the opinion of J.S. Mitchell, the responsible NRC officer (Mitchell was part of the British team working in Montreal and would return to England). Surveys and tests continued over the summer, and in September a conference was convened at the Royal York Hotel in Toronto. Ross and McDerment attended on behalf of the company, Lesslie Thomson from Munitions and Supply, J.S. Mitchell and others from the National Research Council, as well as a delegation from the Ontario Department of Health. There were, Mitchell told the gathering, 'new developments' regarding health protection for workers exposed to radioactivity. These developments derived from secret research in Canada and the United States; as a result, observers now concluded 'that the effects of radio-active radiations on health are more, rather than

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less, important than was previously appreciated.' His own investigations placed the maximum level of exposure per worker per day at 0.05 R (radiation exposure) per 8-hour day. Mitchell stressed the importance of keeping working areas free of contaminants; unfortunately, the refinery was not free of contamination and efforts during the summer to eliminate it had met little success. Mitchell did not doubt that Eldorado could eventually cope with the hazards posed by radiation, but it would be a long?complicated, and expensive process. It should start with the education of the work-force, which should also include the writing and distribution of safety manuals. A full-time safety supervisor was indicated, with the knowledge and ability to make necessary physical and chemical tests. The company should supply and launder appropriate work clothes for its workers. More elaborate showers, a double locker system, and change houses for men and women were prescribed; use of existing contaminated areas was to be rigidly restricted or, if that proved impossible, such areas were to be destroyed.20 These recommendations were accepted. Ross reported at the end of 1946 that refining and filling operations had been revamped to cope with radioactive hazards: $68,000 out of a capital budget of $81,000 was spent that year on safety and health projects. The safety officer Mitchell recommended was hired; a new change house and laundry went up; a new fractioning and tubing building for radium was erected, and a concrete vault established for radium storage. Ventilation, dust, and proper shielding were not unnoticed. Another $32,000 was spent in 1947 bringing some of these improvements into full operation. 'Much progress was made in the program to bring all plant areas and working conditions within the limits set by the health authorities,' Ross wrote. Finally, in 1949, Ross expressed happiness. That year, he wrote, 'there were no cases where above tolerance ingestion of radioactive material was indicated by breath analysis and geiger counting schedules. The overall radiation level of the Plant has been greatly lowered,' he continued, 'and the number of persons receiving radiation exposure above tolerance for even short period was negligible.' What had been 'most alarming' in 1946 and 1947 was now 'a major achievement.'21 The experience may have persuaded Ross that overcrowded

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buildings and multiple processes crowded into facilities that after all had once been meant to house a seed warehouse were becoming anachronistic. To do the job properly, Ross began to think, he would need to move the plant and start afresh. This thought was slow to develop and slower to reach the president and board, but it was in the air by 1950. For there was no doubt at all that the Port Hope refinery was less than spacious. Frank Melvanin, one of the refinery staff, marvelled that 'in this small and interconnected plant there could be so many independent very independent, departments.' There was the radiumfractioning lab, where radium was crystallized out of the radiumbarium solution in rows of shallow glass dishes. Beside it there was radium finishing, where radium chloride from the fractioning lab was converted into usable form behind layers of lead bricks, lead glass, and lead shielding. Beside it was a building for needle filling, where radium was tubed, boxed, and shipped, also behind lead shields. This was the domain of the physicists under Everett Braaten; it was also the realm of the sales department, and we should pause to consider what the company's sales force was doing to market what had once been Eldorado's most important product.22 The company had started as a producer of radium and it had continued to produce radium after the reopening of the mine in 1942. As a consequence, by 1946 it found itself with a very large inventory of unsold radium. Bennett decided to set up a sales division in an effort to dispose of this inventory, which represented a substantial cost to the company. He chose as its head Roy Errington, a geophysicist who had had a distinguished career with Research Enterprises Limited during the war years. It proved to be another case of the right man in the right place at the right time. Sales, as we have suggested elsewhere, were subject to the same disruptions that affected the rest of Canada's international trade. Briefly, very few countries had survived the war with stable, convertible currencies. To take the most obvious example, Great Britain owed far more abroad than it could reasonably hope to repay in the near or medium term. As a consequence, the British government hoarded the dollars it had for the most necessary purchases of food and fuel; other items were heavily regulated and restricted, or simply not imported at all. The same was true of every

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European country. All wanted to buy in North America, and it could even be said that all had to buy in North America; but their ability to do so was very limited. These facts would, it seemed, dispose of Eldorado's overseas markets. There was, however, one shining exception to the dismal picture. Loans, credits, and aid helped to make up for what normal trade was not doing, and medical and relief aid received a very high priority in the years just after the war. Radium was still the foremost means of treating cancer, and the United Nations Relief and Rehabilitation Administration (UNRRA) was anxious to buy some for distribution to hospitals in war-devastated areas. In 1946, therefore, UNRRA ordered 14 grams of radium for central and eastern Europe, including, ironically, 6 grams for Czechoslovakia, whose own radium industry could not supply its needs. Total orders at the end of the year were $574,083 for 19.86 grams of radium, suggesting an average price of just over $28,500 per gram. This was surely good news, especially since the UNRRA orders continued into 1947. Errington reported that orders completed in 1947 amounted to more than $1.6 million. 'However,' he added, 'it should be noted that the UNRRA sales and sale to Canadian Radium and Radium Corporation [Pregel], under the terms of settlement, account for a substantial portion of this figure.' That meant that UNRRA'S temporary custom, while welcome, occupied facilities that otherwise would have served more ordinary customers. The profits from the UNRRA transactions were not negligible, but they were also rather misleading, as Errington pointed out: sales expenses made up only 3% of gross, where a more normal commercial figure would be 25%. Nevertheless, arrangements for the future had been made, including an agency agreement in the United States with the U.S. Radium Corporation. The sales division sponsored its own research and development work to improve on existing applicators and other radium-bearing equipment; it was, as Errington observed, as important to market the container as it was the contents. The same picture continued in 1948, a year that Errington termed 'not disappointing.' Yet out of total sales revenue of $857,567, normal commercial sales accounted for just over $300,000,

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while 'bulk shipments' to the USAEC and the British Ministry of Supply totalled over $550,000. An average year, then, neither encouraging but definitely not depressing. Near the end of his report, Errington included an intriguing note: during 1948, he wrote, 'an attempt was made to explore the possibilities of producing synthetic actinium in the pile at Chalk River. This possibility,' he added, 'has been under discussion for approximately two years.' Errington foresaw applications in mining or oil drilling; what would finally come out of Chalk River had not yet stirred his imagination.23 The first indication that isotopes (a form of an element differing in the weight of its atoms) out of Chalk River might interest Eldorado came in a conference between CJ. Mackenzie, the president of NRC, Bennett, and Errington in February 1948. Mackenzie spoke of work being done in the United States, and Errington arranged to follow it up. More conferences followed, including one between W.B. Lewis, the scientific head of Chalk River, and Errington, in September. It would seem that an agreement to research and develop one particularly promising isotope, cobalt 60, followed, and in 1949 cobalt 60 duly appeared for the first time on the list of products the company had for sale. Sales of radium were low that year, barely more than $400,000, because the bulk government sales of 1948 and the UNRRA bonanzas of 1946—7 were not repeated. The appearance of cobalt 60 on the scene was not entirely unanticipated. J.S. Mitchell, on his return to Britain, had publicly predicted that 'probably the most important scientific value of the pile will be to provide effectively unlimited amounts of many useful radio-isotopes, which should have far-reaching applications as tracers, and lead to unprecedented developments in the chemical aspects of all branches of medical and biological research.' As it turned out, the NRX reactor at Chalk River was peculiarly suited to the production of a radioisotope. Mackenzie, describing the process to a parliamentary committee, compared it to cooking a roast: 'the hotter the oven the shorter is the time to cook the roast.' Since the NRX was hotter than any other, it had an advantage in production time of any given substance. Roy Errington followed these developments with interest. He

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had the marketing organization and contacts painfully developed at medical institutions all over North America. NRC'S Chalk River division, on the other hand, seems to have attracted more notice from prospective customers than it could properly handle. For reasons that we will deal with below, Eldorado's radium inventory was on the decline, and radium production stopped. With isotopes on the scene, faster and cheaper to produce than radium, Errington realized that it was unlikely that the radium market would ever be recovered. It might, he decided, be time to liquidate an obsolete technology and product, and concentrate on a new one: isotopes from Chalk River. Bennett supported him, and, in Errington's words, 'the company decided then, in late 1949, that steps should be taken to enter the cobalt 60 field and that one phase of this operation would be the development of a deep therapy machine.' To do it, it would be necessary to subdivide the sales division by creating a development group within its bosom. Their principal concern was to develop a beam therapy unit — a concept that had occurred to several of the medical faculty at the University of Saskatchewan and to several doctors whom Errington had consulted. Two teams were established, one in Saskatchewan, and the other at the Eldorado unit in Ontario. The Eldorado design was finished first, and to it went the honour of being the first cobalt 60 unit in operation, in 1951,24 Because of this Canada was able to dominate the market for cobalt 60 therapy units for many years. The sales division's work was carrying it further and further away from the daily life of the refinery, to which it had once been so important. By 1949 it hardly needed to sell radium, as we have seen; and in 1950, Eldorado actually found itself in the position of buying the stuff. Errington had successfully replaced Eldorado's own product, radium, with Chalk River's cobalt 60. There was no alternative, since radium was being chased out of the market by the cheaper competition, but it did create an anomaly. Eldorado was selling somebody else's product on the basis that it knew the relevant market best. The company's board decided that it was more logical to turn the sale of cobalt 60 back to the organization that produced it, and in August 1952 the entire sales unit (by then renamed Commercial Products Division) was transferred to the

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newly formed Atomic Energy of Canada, which had taken over the Chalk River reactor project. The efficiency of the Port Hope refinery depended in large part on the quality of concentrate received from Port Radium. All types of concentrate demanded special treatment: there was one treatment for hand-cobbed ore (the highest grade), one for the products of the Wilfley tables, and more for each kind of concentrate bagged at the mine. The averages show that there was significantly less of the highest grade and more of the lowest. The average concentrate grade in 1946 was still 28%, but it was down to 20% in 1947 and only 11% in 1948. The declining grades reduced recovery and raised costs on the radium circuit. At the end of 1947, Jack Burger, the circuit's manager, was told to refine his product only up to the sulphate stage, and in March 1948 the circuit was ordered closed. It was Bennett's opinion, so he told the board, 'that the company had now reached the point where it must discontinue the refining of radium, and that this decision would be effective immediately and would remain in effect,' at least until Port Radium could produce a higher grade of concentrate. Bennett reaffirmed his decision in June. The Ontario Department of Health had approved a plan for radium storage. Radium in inventory was marked down from $ 11 a milligram to $5 in hopes of attracting buyers. But by then its sales life was drawing to a close.25 As a result of this decision, all refinery costs were henceforth borne by the uranium circuit, a cost which had to be added to higher costs for labour, chemicals, and other supplies, as well as the cost inherent in the longer and more intensive treatment demanded by lower-grade concentrate.26 Chemicals and labour accounted for many of the difficulties the refinery manager faced. A soda ash strike in 1946 closed the place down, from mid-July until early December, with consequent delays in deliveries to the u.s. Army, and, given the existing schedule of payment on delivery, drastic results for the company's treasury. The reduction of costs, the simplification of procedures, and the discovery of better ways and means of treating the low-grade concentrates were accordingly high on the refinery's agenda. Ross started research and development work at the refinery in 1946. Work continued through 1947 and 1948, until in 1949 he

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was ready with a major proposal to the board. It might be possible to use an electric smelting technique on the Port Radium concentrates. After all, such a process was already in use at the International Nickel Company's Port Colborne plant, and therefore presumably practicable in certain circumstances. The effect would be to produce a slag containing uranium and a speiss containing cobalt. (This, incidentally, is the reverse of normal: in most refineries slag is the waste and speiss the valuable product.) Deloro, a company for many years engaged in the production and sale of cobalt would purchase the speiss thus providing Eldorado with a windfall profit. The merits and defects of this procedure occasioned much debate and no little bitterness at the time, and they are still a subject of controversy. Arvid Thunaes, from his vantage-point in the Eldorado Project in Ottawa, viewed Ross's excursion into smelting as excessively optimistic. Pete Farmer, the uranium-circuit's head, allowed it to be understood that he too had little confidence in what was going forward; rather than continue on in indefinite conflict with Ross, Farmer decided to leave, and Jack Burger succeeded him as chief of the uranium division. The process did prove to be effective in treating very low-grade concentrate, the purpose for which it was primarily designed. By the end of 1950, work was well under way on a larger project: a new refining process designed to handle any grade of concentrate and to produce at the other end a purer oxide. That story, however, belongs to a later chapter, when Canadian supplies and American demands combined to make reconstruction imperative. At the end of 1950, then, the refinery was on the verge of large changes, but had not actually begun to make them. What would happen next depended on the success of another aspect of Eldorado's activities, to which we now turn. V

Exploration Division had begun its activities in the wake of the intense uranium speculation in the summer of 1943, and just as the u.s. Corps of Engineers were persuaded to abandon their extra-

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territorial interest in Canadian rocks. Dick Murphy became first head of the program, and the first to benefit from the improvements the previous decade had made in exploration techniques. Gilbert LaBine had depended on his eye for rocks to discover uranium, and on outside tests to confirm what he had found. The Geiger counter, however, made it possible to detect radioactivity even where there was no obvious surface indication, and research in Ottawa helped to turn out a model that geologists considered both practical and portable. Distance and space did not make it easy for explorers, and neither did the weather. Prospecting teams, under contract, roamed the Canadian Shield from Chesterfield Inlet on the Arctic shore to central Ontario in the south. Teams would start in the north in the short Arctic summer, and gradually move south as the weather closed in, finally packing their tools at the end of October. The CDT in Washington took an intense interest in the results of these geological voyages, and, as we have seen, Howe cited the Canadian search for uranium as part of his country's contribution to the common atomic defence. Exploration demanded elaborate skills and equipment. Probable areas were staked (in the territories and in three provinces only the federal government could stake claims) and diamond-drill teams called in. Then there were assays to be done, and however promising the geological signs had appeared at first, they never seemed to promise much in terms of economic development. During 1946, Eldorado spent $137,000 on exploration; $246,000 in 1947; and $468,000 in 1948. As a result, nothing was definitively proved, but attention began to concentrate on the region north of Lake Athabasca near the abandoned mining town of Goldfields, Saskatchewan. Goldfields was a relic of enthusiasm for gold in the later 19305. Cominco had set up in the area, had develped a mine, and had constructed power facilities. But the outbreak of war diverted attention and money elsewhere. The gold turned out not to be the anticipated bonanza, and the mine closed. The name stuck, and the dry climate preserved the buildings until some new speculation could bring people to reoccupy them. The speculation started in 1944 and 1945, when Eldorado exploration parties arrived on the

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lake and began staking claims. Diamond-drill work, however, failed during 1946 to confirm any showing 'capable of supporting a mining operation.' 'The significant factor in the Goldfields area is the wide-spread occurrence of radio-activity,' the 1947 Annual Report stated, and it occurred to company geologists that the radioactivity centred on 'strong N.E. faults.' A camp was established on Fishhook Bay (an inlet of appropriate curvature off Lake Athabasca) where pontoon planes could land, but drilling and trenching tended more and more to move to an area just north of the main lake. Two smaller lakes, Beaverlodge and Martin Lake, showed the most promise. The two lakes were separated by a ridge on which some uranium occurrences had been located. It was decided in 1947 to drive an adit through the ridge to determine whether these surface occurrences persisted at depth. This detailed work might show promise, but it certainly did not justify discontinuing surveys in other areas. The trouble was that land-based prospecting, with Geiger-counter-holding crews traversing the landscape, was slow and often inefficient. It was decided to ask Roy Errington to develop a detection instrument that could be used in an airborne survey. This he did and for two years, air surveys were carried out in the Beaverlodge area using a Norseman aircraft flying at very low and rather hazardous levels. It was a bold idea, and if boldness alone counted it should have worked. Unluckily, the Canadian Shield is alive with radioactivity, and granite outcroppings make much the same noise on a Geiger counter as the genuine uranium article. Eventually this enterprise had to be abandoned. The Beaverlodge-Martin Lake program, however, was not abandoned. Work in 1948 produced tantalizing results: promising ore showings off the Martin Lake adit, with between 10 and 15 pounds of U3O8 indicated per ton of ore. Development could, it was hoped, be started in 1949. Meanwhile another group of claims, around Ace Lake, a smaller body of water to the north-east of Beaverlodge Lake, was also attracting attention. The key there was one of those 'strong N.E. Faults' mentioned in the 1947 Annual Report: the St Louis fault, named after Phil St Louis, the Eldorado prospector who discovered it. The ore formations revealed by diamond drilling were peculiar, 'erratic.' In the geologists' view, it was

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'probable that the pitchblende occurs in vertical, discontinuous, tensional fractures, and underground development work will be required before an appraisal of economic possibilities can be made.' Once again it would be necessary to spend money to have even the possibility of making money; when the directors met on 5 February 1949 to consider how much, they learned only that it would be between $750,000 and $1 million. It was a great deal of money, but a great deal was riding on it: a new mine, the extension of Canada's ore reserves, possibly even the defence of the West through the Canadian contribution to the u.s. nuclear stockpile. The money was approved. VI

The years between 1947 and 1950 were profitable, exciting, and challenging, but not conclusive. Geology extended the life of the Port Radium mine, and mining engineering made it more efficient. Research and development pointed to the possibility of recovering Port Radium's tailings, with beneficial results for the company's reserves of embodied uranium oxide. Research and development at Port Hope suggested that something might still be done with the old refinery, but that real progress could only be made through a fundamental revamping, reconstruction, or even relocation of the plant. Ross, the manager, was convinced of it; but his research and development program had not yet reached the point where he could swing president and board into agreement. The possibility existed, however, and would continue to exist as long as uranium was a seller's market. The USAEC in 1950 was just as anxious to buy as it had been in 1947, and there seemd to be no let-up in demand. Demand was stimulated by an international situation that seemed to grow steadily worse in the late 19408, and which became even more serious at the end of the decade. For in September 1949 it was learned that the Russians had exploded an atomic bomb. The great atomic secret was a secret no longer.

Interlude Searching for Security

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BETWEEN 1945 AND 1953 three nations set up their own successful nuclear weapons programs. The United States, obviously, was first From 1945 to 1949 it enjoyed a monopoly of nuclear weapons technology, a circumstance which often leads historians to conclude that the United States was all-powerful in the post-war world. As we have seen, however, the Americans were slow to adapt the atomic bomb to their military strategy, and as late as 1948 or 1949 they were uncertain how they might use it in any future conflict. In fact, American possession of the bomb, unique as it was, tended to mask the very real weakness of the United States' military position. The Truman administration, having demobilized, was slow to commit funds to remobilize. Truman himself believed vast military budgets to be a sinkhole, and resisted his advisers' efforts to convince him otherwise, until circumstances forced a change in policy. And so, until at least 1950, American military planning for the next war focused on refighting the last one. In the event of a Soviet lurch forward, western Europe would be evacuated, possibly as far as the Pyrenees, and perhaps to North Africa, while the United States and Great Britain slowly assembled their forces in Britain and the Middle East for a counterstroke. The resemblance between this plan and the actual events of 1940-3 is more than coincidental. It can be said, therefore, that American nuclear strategy was more reactive than active. The creation of the North Atlantic alliance in the spring of 1949 changed little, though it did establish a formal link between the democracies of western Europe and those of North American. Two further shocks were necessary to stimulate American commitments of men, money, and materials to a vastly increased nuclear program: the explosion by the Soviet Union in September 1949 of its own nuclear device, and the invasion of South Korea by the Communist North in June 1950. The Soviet atomic program drew on native resources as well as on the more spectacular achievements of atomic spies. The Russians had uranium, and since about 1940 they had been looking for more. Stimulated by news of American success, the Soviet dictator Stalin gave atomic research the highest priority in 1945. 'A single demand of you, comrades,' Stalin is reported to have told his scientists in 1945: 'Provide us with atomic weapons in the shortest

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possible time. You know that Hiroshima has shaken the world. The equilibrium has been destroyed. Provide the bomb - it will remove a great danger from us.'1 Stalin's scientists complied. They, like the Americans, could draw on the scientific knowledge of conquered Germany; unlike the Americans they could also exploit uranium deposits in occupied central Europe, especially in the German state of Saxony and, of course, at Jachymov. Working in horrible conditions, German and Czech miners turned out pitchblende, which was airlifted back to the Soviet Union. As the Americans had supposed, the Soviets faced extreme shortages; but as the Canadians had inferred, cost was no object. And at the end of the day, on 29 August 1949, success crowned their efforts. As radioactive traces drifted eastward across the Pacific, the first realization dawned on the Americans that their monopoly had lasted precisely four years and month. The most immediate consequence of the Soviet breakthrough was a convulsion inside the American government, as politicans and scientists squabbled over the logical next step. It was known that a much more powerful device, a hydrogen or 'super' bomb, could be built. It was reasonable to assume that the Russians would build one. Could the Americans abstain? Lilienthal, chairman of the USAEC, and some of his advisers, thought that they could and should. Truman, however, thought differently. In January 1950 the word came down that a super bomb would be investigated, and Lilienthal resigned. A spasm was felt immediately throughout the USAEC, as we shall see, but it took the outbreak of the Korean War to stimulate a protracted and massive rearmament program. When, on 25 June 1950, the North Korean armies invaded their southern neighbour, it was immediately assumed that they had done so with the blessing of the Soviet Union. Korea was a volatile little place, and its competing Communist and anti-Communist regimes were regarded as likely candidates for a war. The Americans had gone so far as to withhold heavy military equipment from the south, so highly did they rate its propensity to aggression; the Soviets, however, had given freely and broadly to the north. It is probable that Stalin and his henchmen did not anticipate either much resistance or much reaction to the Korean invasion; but they were mistaken. The United States sent an army

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to Korea, and it was assisted by a large number of allies, including Canada. Truman, previously hesitant, approved a surge in military expenditures. The Canadian government, on a lesser scale, did the same. Troops were dispatched to Europe. Naval forces were increased. And, finally, American air power capable of delivering numbers of atomic weapons also grew. In money terms, this meant that the USAEC, which secured supplemental appropriations of $2 60 million in 1950, got$i billion extra in 1951, and $5 billion in 1952 to expand its production. The u.s. atomic stockpile, after an initial lag, ballooned. Where the United States had about 1000 warheads in 1953, it had close to 18,000 in 1960. The first hydrogen or thermonuclear bomb was detonated in October 1952. In the meantime, improvements in production techniques streamlined the USAEC'S technical side, while testing and special projects developed smaller, tactical nuclear weapons which could be placed in the hands of NATO'S new European army by the mid-1950s. By then, of course, there was another entrant in the nuclear stakes. The British had not hesitated to start up an independent program of their own in 1945. Early in 1947, it was decided to proceed to bomb production, and in October 1952 a weapon was finally tested. The uranium for this bomb did not come from Canada, but from Portugal, the Belgian Congo, or South Africa; nevertheless the existence of a third, large-scale atomic consumer could not be a matter of entire indifference to the Canadians. The existence of an active British atomic program did not mean that co-ordination among the three original atomic partners improved very much. The Combined Policy Committee (CPC) continued to exist, as did the Combined Development Agency (CDA), the rechristened trust. The rise and fall of American need for uranium tended to govern the level of cordiality in the committee or agency, subject always to the recurrent British spy scandals that punctuated the post-war period. The discovery that Klaus Fuchs, a naturalized British atomic scientist, had passed on significant information to the Soviet Union was a nine days' wonder in the winter of 1950, but just as bad was the news that two key British diplomats, Donald Maclean and Guy Burgess, had regularly furnished the Soviet Union with information from inside the Combined Policy Committee (and, incidentally, from the founding

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discussions on NATO). At least, one observer ruefully commented, Stalin need not have been in any doubt about the West's lack of plans for attacking the USSR. Security and secrecy, therefore, remained a problem for the Western powers, in part because of the very real leaks of information that occurred, and in part because of the popular reaction to news of traitors in high places. The British found their atomic relations with the United States stunted as a result, while in the United States civil servants and politicians showed a marked tendency to run for cover in the face of unprincipled demagogues purporting to attack the Communist menace. In Canada, antiCommunism, for one reason or another, never became the election bait that it was south of the border. Instead, Canada passed through one of the most politically stable periods in its history. While Truman and the Democrats plummetted from public favour in 1951 and 1952, the Ottawa Liberals sailed serenely on. Where Truman's opposition bellowed about Communists in government and demanded to know who had lost China (which had gone Communist in 1949), the most that Prime Minister Louis StLaurent and his colleagues had to cope with was whether there were really any horses drawing pay as army privates in Camp Petawawa, just downstream from Chalk River. In October 1950, just as the Korean War was approaching its climax, C.D. Howe celebrated his fifteenth year in office by preparing to take on a new portfolio. As minister of Trade and Commerce, Howe was responsible, in the post-war period, for what little defence production Canada could support on a reduced military budget. With rearmament, and with the government about to spend $5 billion to re-equip Canada's expanding armed forces, Howe would become minister of Defence Production in 1951. The new job lent colour to Howe's nickname as 'Minister of Everything,' and it added fuel to the occasional charge that the St-Laurent government depended too heavily on the energy and talents of a single, dynamic man. Howe pooh-poohed the charges; he had his job, and other ministers had theirs. But it was true that few in the cabinet were as close as he was to the prime minister, and true as well that few among them would dare to encroach on Howe's sphere of responsibilities.2

7 Stoking a Boom: The Searchfor a Just Price At the beginning of 1947, Canada had four governmental organizations principally involved in the development of atomic policy. Eldorado, the subject of our study, needs no introduction. It was, as we have seen, a crown corporation directly under the minister of Reconstruction and Supply, C.D. Howe. The National Research Council and its president, CJ. Mackenzie, we have met. Atomic research was only a part of the council's mandate, but for Mackenzie it was increasingly the most interesting part. He and the principal scientist at Chalk River, the recently arrived W.B. Lewis, had high hopes of developing usable — meaning cheap — electric power from the reactor technology developed there, using natural uranium as a fuel and heavy water as a moderator. There was still the Advisory Panel on Atomic Energy, the senior officials' committee, but as we have seen its influence was in the descendant with the collapse of the UNAEC talks. Three of the advisory panel's members sat on the last, and theoretically the most important agency, the Atomic Energy Control Board. They were George Bateman, CJ. Mackenzie, and General A.G.L. McNaughton. Bateman was known to be Howe's man; Mackenzie played a cautiously neutral game; and McNaughton was beholden to no one. On McNaughton depended the future of the AECB; but as of early 1947 no one could tell what he would make of it. The AECB'S powers were very broad. It could own, operate, and license any and all atomic facilities. Under these powers, it could

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have taken over the ownership of Eldorado, which would have involved transferring the stock of the company from the minister to the board. But, as we have seen, this did not happen. The board did, however, own Chalk River, but, again as we have seen, it handed it back to NRC to run as its agent. The board also had the power to regulate and this fact gave Bennett some concern, which he discussed with Howe. Howe, as we have noted, replied that the board's regulations had no effect until they were submitted to the relevant minister - himself- and then to the cabinet for approval. As Bennett later commented, 'the Board could not exercise any of its powers without the prior approval of the Minister and such approval would not be given in the case of any regulations which might have the effect of interfering with Eldorado's operating responsibilities.'1 The board inherited existing regulations, such as the orders-incouncil of September 1943 appropriating to the crown all radioactive substances on existing leases and banning all future private prospecting and staking for such materials on federal lands. Only Eldorado could legally stake and claim uranium ore bodies, a situation that might be thought to confer a comfortable advantage on the company, and on the government which controlled it. As a theoretical proposition it offered symmetry, logic, and, presumably, safety. It appealed to those who regarded atomic energy as a matter so important as to be kept safe within the bosom of the state. It was only when the matter was considered practically that certain difficulties became apparent. It is with these difficulties, and how they were resolved, that this chapter deals. How could Canadian uranium reserves be increased beyond what was in the Port Radium mine? Who could develop uranium, where, and under what terms? And, perhaps most important, at what price? I

The pricing of uranium was the business of the USAEC, and of John Gustafson, its director of raw materials. Gustafson was a geologist of long experience, who before the war had circled the globe in pursuit of his profession. Gustafson knew Canada well, and had

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worked there for three years between 1939 and 1942, but his acquaintance with Canada did not imply that his relations with Canadians were always entirely satisfactory. It may well have been that Gustafson was too experienced a mining man to adapt to the new situation that uranium posed. Minerals always had a market price, and the lower price determined supply. In the case of uranium, where the Americans were buying Belgian uranium cheap, and Canadian uranium dear, Gustafson was plainly uncomfortable. He was even more uncomfortable when he wrestled with the problem of encouraging uranium development, since prices that were appropriate to one set of conditions — in the Congo or in the Colorado Plateau — were not suited to another — the Canadian Shield. Gustafson did slice through one conundrum, or rather policy, established by General Groves. The army engineers had actually preferred to get their uranium elsewhere - anywhere but the United States. The reason was to preserve the Americans' own reserves of uranium as a strategic supply for some future emergency. Gustafson, however, saw no reason that he should wait on events; the demand was immediate and urgent, and American reserves should be developed to meet it. That did not preclude buying uranium outside the United States, but it did mean that American supplies were to be stimulated. This development (Gustafson took office in October 1947) had immediate structural repercussions. Establishing a raw materials advisory committee, Gustafson with their advice decided to throw open uranium exploration and development to private competition. Using price as the spur, the USAEC offered a $ 10,000 discovery bonus and $3.50 per pound of contained U3O8 in concentrate. It is true that the $10,000 only applied to 'significant deposits' and that most American deposits were not 'significant'; but it got people's attention. The USAEC also undertook to restore existing mills in the plateau area and financed exploration there. The parallel with Canadian developments is striking, as we shall see, but what is most important is that the Americans had dropped their preoccupation with government ownership or control, which had appeared as recently as the Baruch plan in 1946. Obviously what the Americans were prepared to pay for in the United States

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they would also buy in Canada, if the price was right. Price, and not the structure of the uranium industry, would be the crux of the matter. In Canada events had been pointing to the same conclusion. The known geology of the Canadian Shield made it more than likely that more uranium could be found in Canada. Locating it was expensive, costing $246,000 in 1947 alone, and though Eldorado would increase the scope and the cost of the program, it was not certain that it could ever pay enough to be sure of finding a uranium lode. Chances would be improved, however, if individual prospectors could be encouraged to go out and look for uranium on their own, and if private mining companies could be persuaded to back them. George Bateman, whose background in the Ontario Mining Association was not irrelevant to the problem, discussed the situation with Bennett in the spring of 1947, and they decided to try to move the government to agree to private prospecting. Such a proposal required the consent of the AECB. General McNaughton, once a mining man himself, did not see any reason to hurry in the matter. 'He did not consider the time opportune,' Bateman wrote to Bennett. The general may have thought that the UNAEC discussions should get more time than Bennett and Bateman's proposal allowed, and that that consideration outweighed the convenience of an immediate decision. Six months later, an External Affairs officer who knew McNaughton analysed his refusal, and came up with what he called 'two assumptions.' First, McNaughton believed that there was no 'immediate danger' which would force the allies to dip into their depleting uranium deposits; second, even if there were a danger, uranium could be found 'relatively quickly.' McNaughton may have been speaking from general knowledge of the frequency with which radioactive showings could be located; unfortunately none of these showings promised much. There was nothing in Eldorado's experience to suggest that economic deposits of uranium could be found easily, or quickly developed. Evidence pointed to the exact contrary.2 The CDT/CDA reported a shortage of exploitable uranium, while the USAEC believed, in 1947, that there was an excess of demand over supply (this was prior to a modus vivendi that temporarily solved their supply problems). Bateman passed these arguments

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on to his colleagues on the advisory panel and the AECB. The 'new circumstances' of strong American demand and strategic shortages 'justified a review of government policy with respect to private prospecting in Canada.' The panel agreed to reconsider, over McNaughton's objections, in December. By then, however, McNaughton had abandoned his initial position. There was no longer any chance of success at the United Nations, and that fact made the question of private prospecting 'entirely domestic.' That being so, Bateman quickly pointed out, the question should leave the panel and move to the AECB, which should now proceed to establish a policy for uranium mining. The panel agreed; it recommended that the government revoke its 1943 orders-in-council restricting access to radioactive claims, and persuade those provinces with similar orders to do the same. This was a turning point in the history of uranium mining in Canada; and it was also a turning point for the panel, which had just proclaimed itself irrelevant to the domestic aspects of uranium policy. Thereafter the panel began to sink into increasing inactivity, and despite occasional stirrings, it never again played a major role in the formulation of Canadian atomic policy.3 Bateman had concerted his next move with Bennett. Under the AECB, an advisory committee on mining policy was established. Its task was to investigate to what extent 'private industry, rather than the Government, should undertake development and production' of uranium. Anticipating the answer to the first question, the terms of reference then asked, 'What is the best way of ensuring participation by industry?' and also 'What is the best method of compensating the prospector and private industry?' To answer these questions, the AECB appointed W.B. Timm of the Bureau of Mines, F.M. Connell, metals controller during the war and a distinguished builder of mines, Bill James from the Eldorado board, and J.G. McCrea, president of Dome Mining. Bennett initially planned to make the committee an operating body, with Bolger as its factotum, but he soon decided that its value was primarily symbolic: it would lend its prestige to foregone conclusions and then depart or subside.4 By the time the AECB received the advisory committee's conclusions, the board itself had changed its membership. At the

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beginning of 1948, General McNaughton accepted the post of Canada's permanent delegate to the United Nations and representative to the Security Council. It would be difficult to carry on with the AECB under the circumstances, and so he recommended that the government appoint Mackenzie to be its chairman. Since that still left a gap in the AECB'S membership, the government appointed Bill Bennett to fill the balance of McNaughton's three-year membership.5 Both Bennett and Mackenzie had very clear ideas about the proper role and function of the AECB. Bennett's Eldorado was already more independent of the AECB than that organization's legislative parents had thought desirable; while Mackenzie, because of his close friendship with McNaughton, had not chafed under the general, he had no desire to keep NRC indefinitely subordinated to the AECB on matters of routine. Both men had had their doubts about the insertion into the Atomic Energy Act of 'operating responsibility' for the AECB. 'We thought,' Bennett wrote in 1982, 'that the creation of a third agency with operating responsibilities was unnecessary and would lead inevitably to confusion.' Let the AECB concern itself with 'broad issues of policy,' while Bennett and Mackenzie reported to Howe on the details of administering their organizations. At the same time, however, the two operating heads sat on the AECB and might be said to represent operations in the forum of the board. The sticking point on uranium mining was not the AECB but, surprisingly, Howe. At first Howe seemed to approve the idea of getting private mining interests into the act. With the minister's apparent approval, the advisory committee then endorsed such a proposal. Only later did the minister have second thoughts. There were political and economic ramifications to private involvement in the uranium industry which, for the first time but not the last, needed to be carefully weighed. To entice private investment and entrepreneurs, the government would need to offer a fixed price for a long period. But to do so, Howe worried in a letter to Bateman, 'is likely to get us into difficulties unless the attitude of the u.s. is known.' That the American attitude was momentarily favourable in the winter of the Czech crisis was not surprising, but if 'the threat of war' receded, Canada might well be left with large piles of useless black rock on its hands.6

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Bateman was dismayed. Not only were Howe's misgivings unnecessary, in his view, they also threatened to extract him from a balmy mid-winter vacation in Florida and drag him back to the doubtful pleasures of an Ottawa winter, 'which,' as he said, 'does not please me too much.' He would pass through Washington en route, with the idea of uncovering American intentions a little further, and in the hope that it might be possible to synchronize Canadian and American uranium policy. Bateman feared that such co-ordination might not, at this stage, prove possible. 'I gather,' he told Bennett in mid-February 1948, 'that there is a growing reluctance on the part of our American friends to make any commitment as regards price.' That by itself would justify Howe's fears and at the same time kill any hope that he would support any policy that could not deliver what it appeared to promise, namely a proper, long-term return on investment of time and money.7 As Bateman discovered, there was more going on in Washington than he had realized. Gustafson was desperately worried about the Belgians' reaction to any public announcement of a higher price offer to u.s. (and by extension Canadian) producers than the Union Miniere was getting. He had, too, problems of a budgetary sort: the USAEC had allotted a relatively small proportion of its budget to raw materials in fiscal 1948 (5.3% of the total, or $35.5 million). The next year there would only be $500,000 more, for a total of $36 million or 5.7% of the budget of the USAEC. These figures in fact exaggerate the amount spent on uranium oxide since for security reasons the cost of conversion into feed materials is included.8 The result was a conundrum. The USAEC, the CPC, and the CDA were all committed to getting all the uranium they could buy. Yet they balked at offering the money that could get it. Having identified a raw material shortage, the USAEC then set out to implement a policy that would not increase supply in North America because it could not be publicized. And unless there were publicity, there was little hope of attracting prospectors or developers to the mining of the atom. As it turned out, not only was Gustafson reluctant to overshoot the Belgian price; he was actually prepared to offer less to American producers than the Belgians were charging. T do not think,' Bateman reported, 'Gustafson

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realized until I pointed it out... how much lower than the Congo price this was...' Bateman extracted one concrete achievement from his trip north. Gustafson agreed that if the Canadians matched his public offer - in effect parity with the Belgian price - then he would buy whatever came in. Bateman brought this news to Ottawa, where it was digested by Bennett and the advisory committee. Gustafson was offering $3.50 per pound of refined oxide. Canada, Bennett decided, would offer $2.75 per pound for concentrate with a minimum uranium content of 10%. Gustafson's bonus was, in their opinion, far too small, but if those were the USAEC'S terms, then Canada would have to try to live with them. At least Gustafson had set a lengthy time limit, five years, and that, together with his promise to buy, meant that the government would not lose if it offered essentially the same terms.9 Howe adopted the advisory committee's conclusions. The new policy would need a public forum, and the appropriate place was the House of Commons. The CCF'S Stanley Knowles furnished the opportunity. Rising in the House on 16 March, Knowles started off by stating that the 1943 orders-in-council had been cancelled. Nothing so far had been substituted for them, and it was surely desirable that something be put in their place. What could Howe tell the House? A great deal, as it turned out. 'The whole situation had been reviewed in the light of present circumstances and changed conditions,' Howe grinned, 'and the government is now satisfied that it is now in the best interests of Canada that restrictions against private prospecting and private development of radioactive materials should be revoked...' The new policy would have five main features: 1 The government would require a minimum grade of 10% U3O8 by weight in ores and concentrates offered for sale. 2 Such ores were to be sold to Eldorado or some other designated agency, and to them alone, at the price of $2.75 f.o.b. rail, such sales to be guaranteed until 1953. 3 Commercial by-products (radium was an example) would receive consideration either in the original price or through their return to the seller.

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4 'Special circumstances' might justify a higher price or lower grade. 5 The uranium industry would continue to be regulated by the national government under its atomic energy regulations as promulgated by the AECB.

Some might think that there was a coincidence between this policy and the USAEC public purchase offer. Not so, said Howe. Gustafson's policy had just arrived in the mail, only the day before, and any resemblance was purely coincidental. 'It would seem,' Howe told the House, 'that, although we arrived at the Canadian policy independently, the policy of the United States will follow similar lines.'10 The least that can be said of Howe's announcement was that it was not candid. The policy did not state that Canada was buying for resale, and that a linkage between Canadian and American prices and terms was at the heart and not the periphery of the policy. And, as we have seen, the Canadian government through Bateman had advance knowledge of the American program. Indeed, Howe had insisted on it. Without such co-ordination, it was entirely possible that there would have been no public purchase program on the Canadian side, and there was no indication that Howe was prepared to recommend that the Canadian government assume very much in the way of independent, non-refundable costs. Howe's announcement caused considerable reaction in Parliament: the CCF predictably criticized the idea of allowing this precious natural resource to pass into private, profiteering hands. Their position had not changed for the previous sixteen years, and it came as no surprise. The CCF based its criticism on the fact that individual prospectors were in fact intensely interested in what Howe had had to say. The government was prepared to slake their interest with a do-it-yourself pamphlet on uranium and thorium prospecting. Anticipating a flood of samples, the Mines Bureau had set up a special Radioactivity Division to handle the business. Business there would certainly be. On 18 March, Stanley Knowles told the House that 'this morning's radio carried the news that gold miners were now turning their attention to uranium rather than to gold.' The CCF'S criticism was taken up and answered in Parliament, though not by Howe. The Conservatives, some of

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whom had close links to mining interests, were more than willing to defend Howe's statesmanlike decision to admit private interests to uranium mining. Some Conservatives even granted that no one could know whether the $ 2.7 5 price was sufficient, but that you had to start somewhere; the principle was more important than the price.11 Equipped with their government guides and Geiger counters, prospectors fanned out across the Canadian Shield from Ontario to the Territories. The results varied. On the one hand the Bureau of Mines was very busy. It received and analysed chemically 4717 ore samples in 1948-9, and 12,072 in 1949-50. The prospecting and mining industry, the Radioactivity Division asserted, had 'doubled their demands' on its time and facilities between 1948, when it was established, and the beginning of 1950. The next year, 1950—1, there were still 9424 chemical assays performed, indicative of a slight slump in interest. But there was not, as of that date, a single producing mine in private hands, nor any that were even approaching production. Something had gone wrong; predictably wrong, as Bennett and Bateman would have said.12 What had gone wrong would be the subject of another round of negotiations. II

The U.S. decision in 1950 to acquire the hydrogen bomb signalled the start of an atomic arms race. As Lewis Strauss, a member of the USAEC, put it, it would be 'unwise to renounce unilaterally any weapon which an enemy can reasonably be expected to possess.' Out of fear of Soviet competition, and out of an abiding conviction that the United States was, as the historian John Lewis Gaddis has observed, 'a technologically rich but manpower-poor country,' the United States once again expanded its nuclear arsenal/3 Once again the raw materials division of the USAEC had to find ore. As far as the United States was concerned, it had had some success. In Canada there was nothing new to report, at least from private industry, since the USAEC'S dealings with Eldorado were kept separate and secret, and therefore were not affected by the consideration of publicity that so concerned John Gustafson. In

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discussions in Washington, Bennett made the point that the Canadian price offer had been enough to entice, but not enough to satisfy. To take a concrete example. A mining company interested in uranium had prospected around Black Lake, Saskatchewan. Surface sampling and diamond drilling turned up ore grades between 0.25% and 0.20%. This was promising, but in order to prove the mine, it would be necessary to go underground. At this point economics entered in. The first year's exploration effort cost $140,000. Going underground would cost another $200,000. There would be costs beyond that, since it would be necessary to find a way to concentrate the ore to meet the minimum 10% grade stipulated by the March 1948 offer. Only then would there be any hope of return, and at $2.75 a pound it was simply not worth it. Under the circumstances, as experienced mining commentators told Bennett - who had no need to be told - 'experienced prospectors' were getting 'discouraged.' If they found something they could not secure enough money to develop it; and no one would lend money to develop it because there was no hope of getting an adequate return. Prospectors and speculators therefore shied away from uranium, and there was no hope of changing that until something was done about the price. But time was starting to run out on the offer; five years' security became four years, and then three. There was not enough life in the price to encourage anyone with any idea of long-term investment, and given the development necessary there was no room for anything but long-term funding.14 Eldorado tried private persuasion where public propaganda had failed. 'I had ...a couple of private sessions with certain of the industry leaders in an endeavour to encourage their interest,' Bennett wrote in 1982. 'The one meeting I recall most clearly was held at the Royal York in Toronto.' Buffam, Bill James's partner and Eldorado's consulting geologist, attended, 'and gave a talk on the current status of our exploration programme.' Nothing happened. Bennett next tried the public forum of the Canadian Institute of Mining and Metallurgy in a speech in April 1949. The main point was to justify the $2.75 price. It was the market price, he told the assembled mining executives. The British and the Ameri-

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cans paid no more. No one could predict the future value of uranium, and speculation on a price rise was just that: daydreaming. The price was not fixed for all time, nor in all cases. He drew attention back to Howe's price announcement in 1948. In that speech Howe had suggested that exceptional circumstances might justify an exceptional (higher) price. There might be the case of 'a property with a very large indicated or proven tonnage but of a grade which would make mining uneconomic at the base price.' In such a case, a price might be negotiated on the basis of estimated production costs. Bennett emphasized to his audience that this would be the exception rather than the rule; he did not tell them that he believed that low grade and high cost would make the base price forever uneconomic. 'By 1949,' Bennett commented, 'I was convinced that the original price formula would not produce results since it was based in large degree on the Belgian price which, in turn, reflected a phenomenally high grade of ore.' Bennett guessed that any new Canadian discoveries would be low grade and high cost; Eldorado's new Beaverlodge property in Saskatchewan was the obvious example. Every case would, therefore, be a special case. Either that was not the message received by the confraternity of miners, or even the possibility of special cases held out no temptations. No major mining company showed interest. Uranium was too risky and too speculative. There was no real market, merely what government said was a market. What government had created, government could abolish, and in a world of insecurity that was one uncertainty too many.15 The question of insecurity was recognized as a legitimate concern. The Americans and Canadians extended the period of guaranteed purchase from 1953 to 1955 and finally to 1958. North of the forty-ninth parallel there were no takers. The nub of the problem, Bennett told Gustafson in December 1949, was price. It was all very well to drop broad hints that special circumstances would make special prices. The trouble was that those special prices would have to be justified every step of the way, and eventually paid for on a cost-plus basis. That was not a sufficient enticement, and it offered no incentives. By this time the USAEC was very familiar with what Bennett had to

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say. In December 1949, however, the commission assembled not only Gustafson but his assistants, Phil Merritt and Jesse Johnson, and Carroll Wilson, its general manager. What followed was less a meeting of minds than a confrontation of fixed positions. To the American side, Bennett seemed to be unreasonably spurning the money they were anxious to pour into the search for Canadian uranium. To Bennett, the Americans seemed insensitive to the problems that their proposed methods of subsidy would cause inside Canada. Subsidies, cost-plus contracts, or capital advances would mean a peaceful accounting invasion of Canadian jurisdiction which at best would be uneconomic and inefficient. On the grounds of sound and simple business principles, he argued for a price at which a mining promoter could reasonably, but not certainly expect to make a profit. Let the final accounting concern those most directly involved: the private investors.16 Each side heard the other's case, but the Canadians at least were convinced that nobody had listened. 'I must say,' Bennett wrote to Howe, 'that since Groves ceased to have responsibility for the United States Atomic Energy programme, there has been no thorough grasp of the Raw Materials situation, either by the Commission or by its General Manager.' Gustafson had 'an obsession with cost contracts' that rendered him impervious to suggestions for alternative means of payment. Nor did he like the idea of Canada setting a price of its own, which could queer his pitch with the Belgians, and he let the Canadian delegation know it. 'When we advanced the suggestion that Canada set a price of its own,' Bateman wrote, 'the big stick was flourished and we were told that the State Department would have something to say about that.'17 There was only one ray of hope. Gustafson was due to resign on 31 December. The new year, Bennett hoped, might have room for 'a new approach.' Merritt, who was by way of becoming an old friend and an Eldorado familiar, favoured it. So did the new director of Raw Materials, Jesse Johnson, from whom Bennett expected a refreshing change. It was not Johnson's style to brandish the big stick, but in order to reach a compromise he would have to think it through. There might be action, but it would take time.

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This was a forgivable attitude, especially in view of the upheaval within the commission during 1950, following David Lilienthal's resignation. Lilenthal had placed great trust in Gustafson and his policies, and seems never to have seriously questioned them. Neither did his general manager, Carroll Wilson, a scientist by training whose inclinations at this stage were definitely not in the geological line. Neither was able to mobilize the basic similarities between the Canadian and American positions to reach a compromise. In the Canadians' view, American as well as Canadian experience during the war — experience with such base metals as lead, zinc, copper, and nickel — showed that industry would respond to a price that could provide it with good profits in the event of a successful venture. 'Accordingly,' Bennett later explained, 'we were both opposed in principle to the use of Government funds, u.s. or Canadian, in the financing of exploration and development programmes.' After all, he added, 'who would qualify for such grants and who would assess the efficiency with which such monies were expended?'18 'Canadian officials have always been very cooperative in keeping our Raw Materials Operations fully informed on Canadian uranium developments,' the Raw Materials Division purred in a memorandum in March 1950. 'Last fall one of our geologists visited the uranium properties in the Lake Athabaska district and was given access to diamond drill records and other exploration data.' The message the data gave was very promising: the Goldfields or Beaverlodge properties might yield 1000 tons of oxide a year, compared to the soo-odd tons the USAEC was currently getting from Port Radium. That was enough to keep the Raw Materials Division very warmly attached to the company, and it probably helped to multiply the good feelings already present in the geologists' bosoms. These good feelings included the view that 'next to uranium production in the continental United States, production in Canada is most desirable from the standpoint of our national security.' Shipments from the Congo and South Africa were interruptable, since they came by sea across vast distances. Lastly there was Canada's enviable reputation as a country that knew how to treat a mine. 'Liberal tax laws and the absence of restrictions on financing have made it relatively easy to obtain venture caoital for Canadian minincr nneraHnn* ' J 9

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Since this last observation relates to a general rather than a specifically uranium-oriented condition, it may be useful briefly to mention the good repute in which Canada was held as a receptacle for mining investment. 'In Canada,' an American mining official explained, 'the discoverer of a mineral property can assume the normal highly speculative risks of mineral venture with full knowledge that he has ample opportunity to reap the rewards of his enterprise if he is successful. If he should find a mine, he knows in advance that for three and one-half years after it is put into production it will not be taxed; and, furthermore, that he may sell his discovery without being subjected to the capital gains tax which he would encounter in the United States.' The example that this author, writing in 1959, used to illustrate the success of these policies was none other than uranium. 20 When discussions resumed in January 1950, the atmosphere was more friendly, and the purpose more co-operative. Gustafson was gone and compromise was in the air, and on 12 January, Bateman suggested how it might be achieved. Cost-plus should be scrapped, for the good reason that no plausible estimate of costs could presently be arrived at. Everyone realized that the current price was unsatisfactory, and there was no purpose to be served in rehearsing its defects. Yet if prices were uncertain and the public price unrealistic, exploration still had to go on. Why not make the special price offer the norm, and allow Eldorado to 'make arrangements with individual companies which would give them an increase in price of uranium.' If price was a sacred cow, then let 'additional compensation' be offered via 'some form of bonus or allowance, such as allowances for development, transportation or milling.' Bateman's proposal, which he had first worked out with Bennett and then flown past the Advisory Mining Committee, had Howe's sanction. It also appealed to the USAEC. At the end of March, the two sides reached agreement. There would be an altered price formula, which Howe and Bennett would announce in mid-April. The USAEC would buy up to 8000 tons of uranium oxide to be produced before 31 March 1958, at a price of up to $10 (u.s.) per pound. The oxide in question would pass through the Eldorado refinery and be refined up to the company's existing standards. On 17 April, Howe announced the deal in the House of Commons,

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stressing that it was a logical extrapolation of the original price announced two years before.21 The next day Bennett made a more elaborate announcement to the Canadian Institute of Mining and Metallurgy convention. The price, for what were primarily cosmetic reasons, was still $2.75. To that would be added a milling allowance of $7.25 per ton of ore milled, a maximum price based on a millhead of 0.25% U3O8, and a requirement of a minimum extraction 70%.* The new price met American concerns about the Belgian price, and kept the Canadian price within reason. The Canadians had escaped from the cost-plus strait-jacket, and the price of $6 a pound that was established for a grade of 0.25% (roughly the Lake Athabasca grade) permitted Beaverlodge to go ahead. The United States in return received a commitment for all Canadian uranium produced before 1958, since it was anticipated that existing reserves held between 4000 and 5000 tons, and that another 3000 to 4000 tons might be developed. Uranium was reserved for Canada's own purposes.22 This happy eventuality was confidently predicted. It could be predicted because research and development were on the verge of resolving the mystery of Port Radium's tailings, which would expand and extend that mine, and because exploration crews were on the brink of identifying what really lay underneath the St Louis fault north of Lake Athabasca. In the estimates that government geologists had at hand in the spring of 1950, only a notional allowance was made for private uranium; it was, as far as certain knowledge was concerned, still a mythical beast. The future of the Canadian uranium industry, in quantity of ore as well as quality of research, still seemed to be Eldorado's. * This is how the new formula worked for a grade of 1%: A 1% grade yielded 20 pounds of ore per ton. 20 pounds x $2.75 equalled $55.00 Add milling allowance 7.25 $62.25 But if recovery were only 70%, then only 14 pounds would be produced. The price per pound would therefore be not $2.75 but 62.25/14, or $4.45. The Canadians had urged $5 in December, but this was close enough.

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III

Port Radium was the mainstay of the company's prosperity between 1950 and 1953. At times, however, it must have seemed a pretty shaky support, for during that period, operations at Great Bear were subject to a fair proportion of the hazards that bedevil any remote mining community. The key events were three: the opening of the new tailings recovery operation; a disastrous fire that levelled most of the mill; and the construction of a new mill to take its place. Chronologically the tailings came first. The rate of recovery from ore had been relatively low during the 19305 and during the war, and even during the late 19408 it was known that a considerable amount of contained U3O8 was being sloughed off as tailings because the crude gravity concentrating process at the mill did not permit its recovery. The Eldorado Project attempted to meet this problem through flotation during the late 19408. Flotation is defined as the process of using 'the forces of surface tension to float off from finely powdered ore the particles of the required mineral on to the surface of water in a tank, where they can be removed separately from the remaining mineral which falls to the bottom of the tank.23 Flotation, however, did not work as well or as much as desired, and so attention turned to the recovery of uranium through leaching. The Eldorado Project was starting to expand; it needed more room, and space, unfortunately, was at a premium. So was time, and rather than wait for the complicated machinery of government construction to get into gear (there were only two gears: slow and reverse), the Bureau of Mines bought two war-surplus Quonset huts for under $15,000, which even for those uninflated days was cheap. The two semicircular metal buildings were joined at the base to permit a larger working area on their new site near the bureau. Convenience may have been their major asset, because they were soon bulging in their turn, with up to 60 people working there. Stuart Parsons, bureau director, and Arvid Thunaes, project head, congratulated themselves in at least finding a place to put cramped quarters. Analytical and electronic laboratories went to the east hut, and ore dressing to the west hut. The three major projects that concerned the bureau, the Lapointe picker and

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Geiger counters, the flotation project, and the leaching experiments proceeded.24 'In assessing the relative importance of the three projects,' Eldorado's 1948 Annual Report stated, 'it will be noted that leaching is the only one which provides a possible solution of the basic problem - higher mill recovery. Electronic sorting and flotation improve the grade of concentrate produced,' which could reduce the cost of shipping and therefore refining, because the refinery would be dealing with smaller amounts of richer concentrates and with an improved rate of recovery. Experimental work on leaching in 1948 produced favourable results, and work began on a pilot plant. Pilot plants come in various sizes, shapes, and complexities, but they all share one common characteristic: they test possible flow sheets for mills or refineries, under appropriate operating conditions. It is not uncommon for larger and larger series of pilot plants to be tested, under increasingly realistic circumstances. The ultimate in realism for Eldorado was the erection of a pilot plant at the mine site, and in 1950 one was placed at the mine. The mine management was getting used to the idea by then. It was known that the tailings contained a fair amount of uranium. The gravity process made this fact inescapable. The failure of the flotation process to solve the recovery problem now made an attack on the tailings the most promising line of approach. As Gaudin put it in a letter to Bennett in August 1948, the tailings were in fact 'extremely rich ore. It is all mined and already ground up. It constitutes a very valuable material which it is folly to allow to get lost.' Since 1933, Port Radium had ground out perhaps 250,000 tons of tailings, each ton containing an average of 8 pounds of uranium. With uranium valued at a conservative $10 per pound, Port Radium could be said to be sitting on $20 million worth of uranium.25 The next step was for Gillanders and James, working together, to estimate the approximate cost of recovering the tailings. The method was clear enough: the tailings would be leached - dissolved - in sulphuric acid. Leaching was well known in milling, especially in base metals, and it was being developed for use in the recovery of uranium from South African gold-mine tailings. As Bennett later

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pointed out, a leaching plant 'was similar in most respects to the refining operation in that it involved a flow sheet using chemical reagents.' The chemical reagent to be used was sulphuric acid. That was also no surprise, and further south would have posed no problems. In the subarctic, however, sulphuric acid would add considerably to Eldorado's transport bill; far better to incur a one-time-only bill and bring in the machinery to manufacture it on the spot. The decision to install an acid-leach process was not taken overnight. First mooted seriously in 1948, it would not finally be functioning until 1952. The year 1949 was taken up with feasibility studies both in the Bureau of Mines under Parsons and Thunaes and at Port Hope under Ross and Jack Burger. In the fall of 1949, Bennett appointed Charlie Williams of the Eldorado board to co-ordinate the different points of view involved, and the apparently not inconsiderable disagreements that had arisen. As Bennett wrote to Gillanders in February 1950, 'My purpose in bringing Charlie Williams into the picture was to provide for an informed but detached viewpoint with respect to these various programs. I think,' he added, 'we can be satisfied that Charlie is not carrying the torch for anyone.'26 Work on a pilot plant at Port Radium began in the winter of 1950, and it went operational in June. Personnel from the Eldorado Project (Thunaes) and from the refinery (Burger) helped in the early stages, before turning the plant over to Ted Spice, the mill superintendent, in August. That the acid leaching process worked was proven beyond all doubt; that being so, the only question remaining was the most important one: was it economic? Williams first calculated the cost. The cost would be $ i .5 million. This expenditure would make accessible an estimated 1.4 million pounds of U3O8, costing about $6 a pound. If prices for the final product remained constant, and if supply and wage conditions remained the same, Williams estimated that Eldorado would earn $9.50 per pound profit, or an annual return of $9.8 million. If the Americans were willing to buy what could now be reliably produced, then the company should go ahead.27 The board agreed on 28 September. Three days later Bennett was in Washington, interviewing Jesse Johnson, the USAEC director

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of raw materials, to see what and whether he would buy. It was a good moment to ask. War had broken out in Korea three months earlier, and alternating moods of irrational optimism and equally irrational panic were sweeping the American capital. The USAEC shared the government's fluctuating feeling that Communism wa either being rolled back, or was preparing for a final assault on the Western powers. In any case, nobody could afford to take a chance, and so the prospect of an extended life for the Port Radium mine was mouth-watering. Johnson did not jib at the prospect of having to amortize the acid plant and leaching plant, and under the circumstances he had no trouble reaching a speedy agreement. Bennett and Johnson agreed that 'this program for expanded production would be undertaken solely for the purpose of supplying uranium to the United States' and the United States agreed to take an extra 1000 tons of Eldorado's uranium product. Bennett gave Howe the good news, and Howe, on 28 October, approved.28 What happened next was the single largest movement of equipment down the Mackenzie that had occurred up to that point. Northern Transportation was handed $350,000 to improve the facilities on the Bear River to the point where 1000 tons could pass over. In the south, orders went out for the acid and leaching plant components to be ready at the railhead at the opening of navigation in June. Along with the freight came a film crew to record the event, NT'S finest hour. When it was all over, at the end of the summer of 1951, 1070 tons of building supplies had been carried and hauled from Fort McMurray (Waterways) to Port Radium, along with 2530 tons of reagents to make acid; these were 'stored in every available level area, sometimes quite remote from the building site.' The leaching plant was located at the west end of the campsite, about 600 feet from the mill and about 55 feet above it. The acid plant was i oo feet up, 1500 yards by road from the unloading dock. Some of the work was contracted out, but most of it was performed by Eldorado employees. The leaching plant itself was built of timber and frame (mostly BC fir) on a concrete foundation; the acid plant was made of steel and concrete, with corrugated asbestos siding for walls.

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The most unusual requirement was for bricks to line the furnace in the acid plant. There were none to be had on the spot, and freighting in bricks would be proportionately as expensive as bringing in the other heavy items on the construction list. It would be easier and far cheaper to make them on the spot, if only somebody knew how to do it. Eldorado's employees may have lacked the skill, but they made up for it in ingenuity. Pat Hughes, an Irish immigrant, volunteered to try. Flying to Edmonton, he rented the basement of a house, bought 2000 bricks, and recruited a team of other Irishmen to study the fine art of brickmaking. After a few weeks he judged them proficient, and flew them back in to Port Radium, where they made the brick liner for the furnaces. (Hughes later enjoyed a highly successful career back in Ireland, where he helped to revive the Irish mining industry.) 29 The tailings had been dumped, for the most part, in Great Bear Lake, not far from the mill. The lake was very deep, which meant that a special suction dredge had to be designed working as an elongated vacuum cleaner to suck up tailings from the lake bed. Dredge technology is not an especially common property, and to get it Eldorado went as far afield as Baltimore, to the Ellicott Company, dredge specialists. It was a useful and a profitable choice, since Ellicott consultants suggested that it would be entirely feasible to keep the dredge going the year round by piping up water pumped out of the mine. The mine water stayed at a constant 42°F, enough to keep the dredge afloat. To do it, piping was constructed around the top of the dredge and attached to a main pipe from the mine. Every 18 inches or so, water spurted from nozzles, sufficient to keep the dredge in a pool of open water that extended for 7 or 8 feet from its sides. The effect permitted the dredge to manoeuvre, something essential to its efficient functioning. Paradoxically, the dredge worked better in winter than in summer, since its ice moat was resistant to the fierce winds that blew across the lake. In summer, with open water everywhere, the dredge had frequently to take shelter from storms.30 By November 1951 things were going very well indeed. The Port Radium mine even without improvements was producing at a profit, ultimately, for the company, and the Americans were on

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record to say that they would buy everything it could produce. At Port Radium, some minor repairs were underway at the mill. Some mine veterans remember that conversation centred on the northward migration of the caribou and the prospect of fresh meat for the table. In a corner of the mill welders were at work near piles of jute sacks used to bag concentrates for shipment. A spark from a welder's torch travelled the short distance to the sacks, and in seconds the sacks were in flames. The fire quickly spread. One quick-thinking mill-hand turned on some water from the pumps, which helped douse the flames and froze on the machinery. This fact, and this alone, prevented a complete disaster. Frozen machinery could be thawed; burned-out machinery, twisted and melted, would have had to be replaced at hideous cost in time and money. It was, however, bad enough. The mill was gutted. At twenty below zero, there were no walls and needless to say no heat. The conveyor belts, the wiring, and the heavy mill siding would all have to be replaced. Mill production ceased.31 News travelled fast, first to Edmonton by wireless, then by telephone to Ottawa and then, on 14 November, to Washington, only five days after the fire. Not that there seemed to be very much that either Ottawa or Washington could do. Freeze-up was on, and there was no hope even of landing at Port Radium for another couple of weeks, possibly even a month. Freeze-up therefore encouraged contemplation as to how to implement the immediate and inescapable decision to rebuild the mill. Because the leaching plant was almost completed, virtually all spare stocks of construction materials available on site had been exhausted. Everything would have to be flown in. If it were not, the mill would be out until 1953 and Eldorado could not afford it. In anticipation, the company's agents rounded up every available board foot of lumber from the company's own stores and bought up all they could in Yellowknife and Edmonton. To keep the weight of materials down, it was decided to rebuild the mill using walls made of aluminium sheeting and fibreglass panels, mounted on a wooden frame. Such equipment as could be salvaged was repaired, but a crusher and seven James or Jimmy jigs, as well as a complete conveyor belt system had to be flown in.

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Much credit for the recovery can be assigned to Ted Spice, the mill superintendent, and Hal Lake, the mine manager. Spice placed crews in the rubble of the mill as-soon as he could, while spacing outdoor heaters — oil drums — around the property to allow them to take heat breaks every so often. The mill was rebuilt from the inside out, and the sidings were the last item to go on, after all the necessary machinery was moved in. It was another story getting the machinery in. Eldorado needed a big cargo plane. It had nothing bigger than a 003 itself, and the RCAF was unable to offer much assistance. The only source of a cargo plane large enough to handle the inbound freight efficiently was the u.s. Air Force. Bennett tried first through the USAEC and got nowhere. After weeks had passed, Bennett was lunching with General McNaughton, who by 1951 was Canadian chairman of the Permanent Joint Board on Defence, the Canadian—American defence co-ordinating body. To McNaughton he explained his problem. The general phoned his American counterpart; wheels turned, and before long not only a plane but a squadron turned up in Edmonton to begin hauling. One u.s. plane stimulated some publicity, not least because it once slewed off the runway at Edmonton airport and crossed a busy street to land in a citizen's living room. Spectacular though it may have been, it was also sufficient. In May 1952, two months before navigation reopened, the mill was once again open for business.32 The gravity mill and the acid-leaching plant worked well together. Although the mine and mill continued to be a high-cost operation, the willingness of the USAEC to meet the cost kept the mine in profitable operation, ultimately, until 1960. The cost was even a little less than the $6 per pound of U3C>8 that Williams predicted in 1950: $5.77 in 1952, and $5.48 in 1953.33 The same war that brought Eldorado and Port Radium their sellers' market also brought them attention from another source. Port Radium was high in the Arctic, relatively close to the coast and therefore close to the Soviet Union. It was theoretically possible, in case of war, for the Soviets to send a suicide mission to the north-west with the object of wiping out the Eldorado mine. The likelihood of such a mission was probably less than the likelihood of war, which we would judge remote, but it did stimulate interest in

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the mine's defences from the military and the RCMP. The RCMP wanted to expand the custodial force at the mine from one to twelve; their concern was sabotage. The military had broader concerns; at one point they discussed with Bennett the possibility of constructing 'duplicate facilities' at Port Radium, a possibility that boggles the mind if one considers the difficulties, and expense, of duplicating mine machinery or possibly the mine shaft. As is commonly the case when two parties to a negotiation have little incentive to agree, negotiations dragged on until finally, in November 1953, the Joint Planning Committee of the Chiefs of Staff concluded that in all probability nothing would be done. There was, it was true, a kind of militia force on hand, called the Canadian Rangers. Equipped with automatic rifles, they might be able to protect the mine against a well-advertised small-scale attack. The creation of this platoon was 'the limit' that Bennett would concede. He and his officials were 'not prepared to have this platoon carry out any effective training or preparation of defensive positions.' That might take time away from necessary tasks; and it might have an undesirable effect on local society. As for sabotage, in Bennett's view there was no way of guarding against it. There were too many points in the mine that were vulnerable; and adding watchmen would be expensive, especially since there was no disposition on the part of the departments recommending them to pay for them.34 Port Radium was only sustained by high morale, low turnover among its staff, and a style of life that the married and the socially active considered close to ideal. So did those who, for their own reasons, preferred to live far from civilized institutions such as the divorce courts, the police, or other agencies of modern society. The simple tax savings acquired in the north were a strong incentive to stay and save more: untaxed benefits included room and board, trips in and out, and an essentially free recreational system which, if not totally free, was subsidized to a degree unheard of further south. The members of the Canadian Rangers apart, the news of the outbreak of the Korean War caused few headaches in Port Radium. More important than the news of war was the possibility that NT'S 'Bear' boat would be late in July 1950, so late that Ken and

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Sylvia Donald's wedding would have to be postponed because of the non-arrival of the officiating minister. (The 'Bear' ferried passengers from an airstrip at Sawmill Bay to Port Radium.) But the ship did come, at virtually the last moment, bringing news of war and the vital cleric. The war took second place.35 IV

The war did not take second place outside. It was never far from the thoughts of defence planners and politicians in the United States and Canada. Canadian officials and military officers shared American apprehensions and appreciations of what could happen in the event that the Russians decided to march through central and western Europe like the United States and Britian. Canada embarked on a rearmament program. Some $5 billion was spent, and in 1951 Canadian tropps and planes were again sent to Europe to serve as part of a NATO army to block the possibility of Soviet aggression. It followed that the provision of uranium to the American bomb program would continue to be a high priority in the Canadian government's defence agenda. The bomb might be the only deterrent available to keep the Russians in their barracks, rather than following the path of temptation into a poorly armed and demoralized western Europe. As the Communist threat appeared to increase, the need for more atomic weapons appeared to increase, too. At a meeting in September 1950, the American defense secretary told the u.s. members of the CPC that 'the Joint Chiefs of Staff are getting ready to inform the Atomic Energy Commission that its requirement for atomic weapons had been doubled.' Congolese production would have to go up, and the commission should seek extra uranium wherever it could. That would include Canada where, it was recorded, 'prospects were good' for 250 tons.26 Getting ore from the Belgian mines, the British stockpiles, or Eldorado was becoming a much more time-consuming task, and the responsibility for insuring supply moved up as the job grew more difficult. It fell to Gordon Dean, the incoming chairman of the USAEC, to try. Dean had until recently been the commission's junior member, but the resignation of Chairman David Lilienthal

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in January and the reluctance of the next-ranking member to take his place finally catapulted him into the senior position. It helped that he had once been the law partner of Senator Brien McMahon, who had drafted the u.s. Atomic Energy Act and who had taken a strong interest since in what his creation was doing with itself. Because of his connection to McMahon, it was assumed that Dean's appointment, like so many others, was a case of political hackmanship. So widespread was that feeling that a great many people must have been moderately surprised when Dean revealed unsuspected qualities of leadership; from a Canadian point of view, most of these qualities were good. It was not that the previous chairman had lacked goodwill. He may even have had too much of it, and as a consequence spent an inordinate amount of time explaining to and feuding with smallminded members of Congress, rather than running the affairs of his commission. During Lilienthal's troubles, which increased as he drew closer to his resignation, Dean might have seemed less rather than more than helpful. His role was to warn rather than advise, and when he did advise, it was that Lilienthal explain himself more specifically to the Congress's watch-dog, the Joint Committee on Atomic Energy. Dean's position was certainly not heroic, but it was politically sound, as his own tenure as chairman would soon demonstrate. At the other end of his responsibilities, it became obvious that Dean would not leave as much to the commission's general manager, Carroll Wilson. As chairman, he intended to do more than set broad policy, and when Wilson learned this he too found an opportunity to resign. By the end of the summer of 1950, the USAEC'S high command changed over, at about the point that the Chiefs of Staff began to call for more weaponry.37 Dean could do what he wanted, since what he wanted was to expand production. It did not abate his enthusiasm that Senator McMahon was especially concerned to improve uranium extraction from low-grade ore. It had not escaped congressional attention that such ore was to be found in abundance inside the United States. For the moment, that did not affect Canada, since the scarcity of all supplies made it imperative to procure foreign uranium. But it was a whisper that we shall hear again.38

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Through the winter of 1950—1, the u.s. military maintained a constant pressure on the USAEC. No, the army's Special Weapons Project told the USAEC in 1951, the United States was not doing enough; 'the Commission's most optimistic forecasts of weapon production would not meet military requirements,' in the words of the commission's official historian. If that were so, Dean reasoned, then steps would have to be taken. To take some of them, he called on Jesse Johnson. Johnson had been director of Raw Materials for less than a year when Dean took over. Tall, courtly, self-confident, his personality and his knowledge of uranium supply appealed to Dean, who knew little of geology or mining. Dean relied greatly on Johnson, and displayed a tendency to make Johnson's opinions his own. Naturally Johnson's position was the stronger for it, but what really bolstered his authority was the blank cheque he received from the u.s. military. Once, reminiscing about a discussion with army Special Weapons officers, Johnson asked how much uranium they might want, and at what price. Those questions, the officers replied, were naive. They wanted as much uranium as possible, and at any price.39 That demand happily coincided with the attitude of the supplier, if the supplier was Canada and the responsible minister C.D. Howe. In January 1951, Howe reported that he was 'all in favour of expediting and expanding Canadian production in any way possible.'40 Canadian production meant not just Eldorado's production, but the output of privately owned mines. Johnson and Merritt proposed to stimulate lagging interest in Canada's private mining sector through timely and easily available loans. The loans would have some controls, and borrowers would have to meet certain conditions, but the object was to make it easier to develop ore bodies and, therefore, the loans would be offered at a stage when only an educated guess could stand between a mining promoter and a dry mine. Direct American assistance would not wash, in Bennett's opinion. Howe would support assistance within reason, but he would not agree with premature and unsalvageable loans. Eldorado itself could act as a lender, if it had to, but only if secured by proven ore reserves and a production guarantee.

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The prospect of the American government acting as banker to the Canadian uranium industry was also not enticing. Howe was firmly opposed to it, as he had been to American government uranium claims during the war. There was, he held, a gulf fixed between friendly and profitable business and intervention. For intervention might not be that far from interference, if the Americans needed the ore badly enough. Better to keep the question of ore supplies between governments, where it belonged.41 Bennett still had to explain to Johnson why there had been so little tangible progress in the matter of developing uranium. He did not think that it was the price, a subject on which his rubber-stamp advisory mining committee concurred. It might have been sheer bad luck, in that no particularly viable uranium properties had as yet been found. To demonstrate that it was nevertheless possible to find uranium, Bennett gave thought to creating a burst of publicity for the Eldorado property at Beaverlodge Lake, which was then entering its fifth year of development. Though there was uncertainty about certain aspects of Beaverlodge, as we shall see, there was no doubt that there would be a mine there and a big one. That revelation might prod other companies to enter the Athabasca fields and imitate their big federal brother and (so it was hoped) role model. Bennett did not deny, however, that something must be wrong with the package of incentives being offered. He and Johnson agreed on that, at least. Johnson kept his further thoughts to himself for the moment, and when he did explore the topic, he discussed it only with Merritt, and then with Dean. It seemed to Johnson that only a substantial price hike would do the trick of attracting venture capital into uranium mining. Such a price rise, he assured Bennett at one point, would not upset current pricing arrangements (such as the price offered for 8000 tons of Canadian uranium the year before), and it would not affect the existing parity between Canadian and American prices. With that assurance in hand, Bennett left Ottawa on tour to the company's western properties at the end of January, returning only on 19 February 1951. Bennett then checked in with Johnson, to learn that the USAEC had indeed decided to revise its price schedule, but that security prevented him from disclosing the details, even to

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Bennett. The most that he would say was that the purchase guarantee might be extended for another two years, from 1958 to i96o.42 Secure on his southern flank, or so he thought, Bennett started work on a carefully balanced speech to the Prospectors and Developers Association, the creature and creation of a prominent and highly energetic Canadian mining speculator, Viola MacMillan. Since the established mining companies were unwilling to pursue uranium, it was the more adventurous speculators who had to be attracted to uranium; to them, Bennett planned to argue that the established price as published was not only adequate, but lucrative. The speech would be given to the Prospectors and Developers' annual convention in Toronto on 6 March 1951. The draft was going nicely when Bennett picked up the newspapers on i March, a Thursday. It seemed that Washington had announced a new price schedule. So far, so good. But the details, which Bennett had expected would be cosmetic, had unexpected substance. The USAEC proposed to offer between $1 and $2 more per pound of ore, depending on grade. The speech went into the wastebasket, as Bennett contemplated the fact that parity between the Canadian and the American prices had ceased to exist, and that current pricing arrangements were sadly upset. What kind of bait could Eldorado's president dangle in front of the prospectors now, and how could he come up with it in the five days remaining before his speech? Obviously it would not do to tell the assembled prospectors that Eldorado intended to raise its price, but was still thinking about how to do it. That would be tantamount to admitting that the Americans had not consulted the company about their price rise, and such an admission might diminish Eldorado's psychological advantage in dealing with its potential clients in the Canadian mining industry. So there was only one way out, Bennett decided. In the five days he had left 'we could attempt to develop a formula which would bring the Canadian price to approximate parity with the American price.' Friday, 2 March, was a busy day. Bennett got on the phone to Johnson in Washington, explaining, cajoling, and proposing. Eldorado could not easily live with so great a difference between

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the American and Canadian prices. No new production could be expected from Canadian mines until the situation was rectified. Johnson, in response, apologized for the failure to notify the Canadians in advance. It was because the commission itself had not decided what to do until the very last minute. He had not meant to implement price discrimination against Canada, and if Bennett wanted to raise his price to match, the Americans had no objection to absorbing it. On Saturday, 3 March, Bennett gave this news to Howe, and got his consent. And on Tuesday, 6 March, Bennett told the delighted prospectors that the Canadian price offering was going up by $1.25 across the board, along with a few incentives thrown in for good measure. Parity and harmony were preserved but it had been a close-run thing, and Bennett was angry and embarrassed not to have been consulted in advance. He had, he later told Bateman, 'stated rather bluntly that the situation could have been avoided' had Johnson taken him into his confidence. Johnson, ever the gentleman, had been embarrassed in his turn, and in Bennett's opinion that factor, 'plus the impressive figures we had been able to develop' did the trick.43 Approval by the USAEC was practically automatic. No issue of policy was raised, and the only explanation proffered by the Raw Materials Division to the commissioners simply restated the terms agreed upon with Bennett. Commission approval did not in fact occur until after Bennett had gone ahead with his own announcement, but it was a measure of Johnson's strength within the commission that this could be done.44 The result of this latest revision of the USAEC—Eldorado agreements was that the commission was still in the position of promising to buy all the uranium oxide produced in Canada, up to a total of 8000 tons. (It should be recalled that current production was between 200 and 250 tons per annum.) It was agreed that the Government of Canada could reserve any amount it needed for its own atomic program, but in practice that meant that Canada would get back from the United States what it needed in the form of uranium metal. The price established was not to exceed $11.25 (u.s.), and this was, substantially, the final price. The question of American loans was derailed, and Eldorado continued in all things

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to act as the intermediary between Canadian mining companies and their ultimate customer, the United States government. This was a point that Howe insisted upon, and that Bennett stressed. It was, possibly, the most important feature of the price schedule negotiations to emerge down to the spring of 1951. V

Eldorado's own dealings with the Americans were segregated from the question of a price formula. Unlike any other Canadian uranium company, Eldorado acted as its own representative, a situation that imposed special advantages as well as special responsibilities on the company and its management. Eldorado was, at one and the same time, a mining company endeavouring to survive on a commercial basis by selling its product at a profit, and an agency of government with responsibility for shaping and implementing a national uranium policy. Before 1951 the company had not had to do much beyond acting in an exhortatory capacity, up to the minister, and down to the mining companies; but in that year things were changing. The lines of Eldorado's responsibilities were not as they were sometimes assumed to be. The company reported directly to a minister, C.D. Howe, and through him to a cabinet committee on scientific and industrial research. Howe chaired the committee, and the committee almost never met. There was still the cabinet, but there too there was little to say and less to report. Because the company was now making a profit, Howe did not have to secure a parliamentary appropriate for it, and therefore there was no regular parliamentary debate held on its affairs. This differentiated Eldorado from the Chalk River project, which regularly required infusions of money and which could therefore be debated in the House of Commons. There remained within the government three agencies that occasionally concerned themselves with Eldorado. The advisory panel of senior officials met sporadically during this period, but contributed little to policy; it received, in return, very little information on Eldorado's affairs, a natural enough situation since the company was unrepresented on the panel. The Atomic Energy

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Control Board met regularly, and from time to time received reports on uranium mining from Bennett or Bateman. Although the AECB was kept informed of the trend of price negotiations and sometimes received copies of Bennett's correspondence with the Americans, it contributed nothing to their progress or result. It did, however, perform a useful function in doling out awards and grants for research in several universities on ore dressing and metallurgy. There was, finally, the auditor-general of Canada. The auditorgeneral assumed the responsibility of passing on Eldorado's accounts as soon as the company was publicly nationalized in 1944, and certainly no one would have denied that his services were badly needed. The company's past remained cloaked in a mantle of wartime secrecy, and the task of sorting out Eldorado's complicated accounts took Grant Glassco's special team of accountants two years, an expenditure of time that might have daunted even the auditor-general. But finally Glassco and his investigation were done, and more regular procedures took their place. The auditor-general of the day was Watson Sellar, a long-time fixture in Ottawa who had experienced government as a political appointee, as a high-ranking civil servant, and finally as auditorgeneral. Sellar made annual reports on the government departments and crown companies under his jurisdiction, and these reports were then examined by the Public Accounts Committee of the House of Commons. The Public Accounts Committee reflects the majority of the day, in 1949-51 the heavy parliamentary majority of the Liberal party. Its chairman was David Croll, a Toronto Liberal. The auditor-general's recommendations were never taken lightly, either by Bennett or his board, and the board minutes for the years 1946-50 show several occasions in which the company's practices were changed to conform with Sellar's recommendations. On occasion, Sellar was happy to co-operate when adjustments had to be made to the company's accounts. An example was the increase in Eldorado's depletion allowance from 30 cents per pound (an amount agreed with the Manhattan District during the war) to 11 % of the selling price of uranium black oxide, which, in 1949, would have been $1.65 per pound. A depletion allowance is a term used

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only in the mining industry and it reflects the rate at which a company's principal asset, its ore, is used up. Ordinarily, depletion was 17% of a company's taxable income; since the procedure followed by Eldorado was different, it required Sellar's consent. It formed an aspect of Eldorado's contracts with the USAEC, as it had with the Manhattan District, and it appeared in the company accounts year after year. When the issue arose, in February 1949, Bennett first cleared what he proposed to do with Sellar, and then announced to the board that he would like to alter the 'purely arbitrary' depletion allowance. Haydon furnished a memorandum justifying the change. The next year, 1950, it was Charlie Williams who, as a member of the board, argued that the depletion allowance should be upped again, this time to $g.65.45 As is commonly and properly done in accounting practice, an accountant may query practices or entries in a company's balance sheet; and in Eldorado's case the Public Accounts Committee was ready with its own questions. It took on Eldorado in June 1950, just before the parliamentary recess; just before, too, the outbreak of the Korean War. It happened that one of LaBine's pre-war transactions was still sitting on Eldorado's books. The El Bonanza Mining Corporation was a thirties promotion that had never gone anywhere, but whose shares had mostly ended up in Eldorado's hands. To Sellar, El Bonanza was an anomaly, and its appearance as a $7 credit item on Eldorado's balance sheet a messy reminder of things past, especially since 'due to the state of the books and records an audit has not been possible.' Surely the stock was totally worthless, the auditor-general argued, and it should be written off. Sellar took up the matter with Bennett, and was relieved to discover that 'consideration is being given to winding it up.' Before that could happen, an unexpected windfall occurred in the person of JJ. Gray, mining promoter, who on i December 1949 bought up 2.4 million shares of El Bonanza for $25,000, or $24,999 more than they were worth to Eldorado. It was $25,000 more than they were really worth, since a geological survey by Gillanders and Buff am showed no ore of any value. This would appear to be a transaction that should have been cited under the heading of unqualified good fortune, but it attracted criticism from opposition members on the Public Accounts Committee.

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The Conservative leader, George Drew, was on the committee. Drew had once made a name for himself as Ontario securities commissioner, and he seems to have believed that this was a golden opportunity to parade his understanding of the world of penny stocks. Drew was joined in the pursuit by Donald Fleming, a Toronto Conservative. Their point, as it developed, was that Eldorado's board had approved the sale of 'property owned by a crown corporation ... without public notice and without reference to the government.' In reply, Bennett was at pains to show that the decision was not sudden, and that it had not been made without ascertaining that the property had no geological interest, and no apparent value. Drew's argument overrode this reply. 'His point,' Bennett later wrote, 'and of course this was directed at Howe, the responsible Minister, was that a Crown asset had been disposed of without appropriate approvals.' Since one item of the opposition's stock in trade was the legend that Howe acted as a dictator in arrogant disregard of the public interest, it was clear that Drew was really chipping away at a small corner of the dictator's empire. When Bennett pointed out that he was discussing a thing of no value, Drew simply repeated his point until Ross Thatcher, a CCF member from Saskatchewan, deflated his argument. T do not find myself in agreement with Mr. Drew,' he bluntly told the committee. T think that if we set up a crown corporation, as we have done in this case, we should hire the best possible men to run it and leave them alone to run it. Mr. Drew suggested that every time they wanted to sell some property or shares, the officials of the company would have to come to parliament or to a parliamentary committee. I do not think so. From what I have heard in this case I think they acted in a proper manner and made a pretty good deal.'46 It was a breath of common sense and it blew Drew's case away. The target in any case was Howe, not Eldorado, and not especially Bennett. It did not behoove Bennett or Eldorado to be either partisan to the Liberal side or antagonistic to the opposition, and in other cases Eldorado's relations with the opposition were considerably warmer. Howard Green, Conservative MP for Vancouver-Quadra, was interested in atomic energy, and appreciated, later in the 19505, the testimony of Bennett and his officials before a special Commons committee set up to look into the atomic

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projects Canada was bodying forth. Many years later, Green still thought well of Eldorado. John Diefenbaker, the maverick Conservative MP from Lake Centre (and later Prince Albert), Saskatchewan, also took an interest in Eldorado's Beaverlodge mine. In his case, Bennett welcomed a visit, laid on a flight to Beaverlodge from Edmonton, and 'told our Manager to roll out the red carpet. I think I may also have told him that in arranging any social event, he should keep in mind that John was a teetotaller. Diefenbaker never forgot the visit and invariably brought it up every time we met in subsequent years.'47 The opposition never again posed a serious threat to the manner in which Eldorado was being run and indeed there is some question whether Drew's posturing can be taken seriously. Yet there is a genuine question of accountability, and it is useful to pause and reconsider the procedures the company established to maintain contact with the politicians. It was, in the first place, the minister, not the cabinet, that counted. As far as the ordinary administration of the company was concerned, this was inevitable, and even on questions of major policy the cabinet seldom had time to do more than receive Howe's recommendations. Major policy questions were of two kinds, those involving the company proper and those that involved its function as the government's uranium procurement agent. Matters of the first kind were discussed by the board and the executive committee; before they were considered, however, Bennett let Howe know what was in prospect. 'This gave him an opportunity of expressing his views,' Bennett wrote, 'which I, in turn, would present to the Board during discussion of the item in question. However, for the most part, he simply stated that the Board should use its best judgment in determining a particular policy.' The board having exercised its best judgment, the results were packaged up and sent to the minister. This was a second opportunity for ministerial input, and allowed Howe to question the wisdom of any board decision 'which,' Bennett wrote, 'as I recall, he never did.' Howe had more, much more, to do with the larger question of ore procurement. That involved billions of dollars and a heavy impact on the economy. As we have seen and will see, Howe made

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periodic announcements in the House of Commons on the subject; and the most crucial negotiations between Eldorado and the USAEC - as well as, later, the British - commanded Howe's attention, participation, and support. 'Frequently,' Bennett commented, 'he was asked to indicate his agreement to a particular course of action which he invariably did in writing.' These were ad hoc procedures; nowhere do they appear in statute or regulations. They were not unduly burdensome to Eldorado, and they depended in part on a close and trusting relationship between Howe and Bennett, as well as on Howe's apparently perpetual tenure as the company's responsible minister.^8 The burden of accountability threatened to grow, from Bennett's point of view, when the government introduced a Financial Administration Bill in the House of Commons in the fall of 1951. The government had in mind the rationalization of the system of government agencies that had grown up over the previous thirty years, and the strengthening of the ties that bound them to Ottawa's so-called 'central agencies' — first and foremost being the Department of Finance. The bill listed crown corporations under three schedules, labelled B, c, and D. B corporations were effectively extensions of government departments; D were proprietory corporations operating as businesses; and c were somewhere in between. Eldorado was a D corporation, a company which was supposed to fend for itself under the overall supervision of its minister. One aspect of the bill took away from Eldorado the immunity from taxation it had enjoyed as a crown corporation: all Schedule D corporations were henceforth to pay income tax, as well as provincial imposts including corporation tax. But crown corporations of the D kind were not entirely free to do as they wished, since another provision in the bill permitted the Department of Finance to request that surplus funds held by such a company be turned over to itself, rather than invested in short-term securities as Eldorado had previously done. This provision, Bennett later commented, 'went on to stipulate that a Company could request the return of these funds when needed, [but] I was concerned that once the funds got out of our hands, we would never get them

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back.' Once this kind of a relationship was established with the Department of Finance, Bennett worried, that department would start interfering with the way Eldorado was run, in effect forcing the company to report to two masters, its own minister, and the minister of Finance.49 The Financial Administration Act passed just the same, and Bennett's protests to Howe were unavailing. It may have been intended, even by Howe's colleagues in the cabinet, to provide against the day when he was no longer there. And it may, as a Conservative MP suggested, have been intended to make a distinction that Howe did not often make. One day, J.M. Macdonnell recalled, Howe was listening to the leader of the CCF in the House praise a report he had just given as 'a pretty good recommendation for public enterprise.' Then, Macdonnell continued, 'The Minister of Trade and Commerce gave an answer which I really think should, in some way or other, be immortalized. He said "This is different. This is my enterprise.'"50 The last word should go to an official of the Department of Finance: asked about the distinction between Howe and his executives and the rest of the civil service, he mused, 'Those boys thought C.D. would live forever.' VI

Howe did not live forever but until he left office in 1957 his realm remained intact. In the case of Eldorado, the minister of Trade and Commerce (and since the spring of 1951 the minister of Defence Production as well) dominated almost all the relevant policy bodies. Those he did not dominate he ignored, and left, like the advisory panel, to wither on the vine from ignorance and impotence. Some people considered Howe's managerial style dictatorial and arbitrary. People who actually worked with the minister, however, did not share that opinion. Eldorado had a large, but not unusual degree of freedom to do what it wished, and what was true between minister and company was also true between head office and the several company divisions. Head office was small, and remained so. The experts were elsewhere, either on retainer, like Williams or James or Buffam, or on the spot, like Gillanders, Spice,

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Lake, Ross, or Thunaes. Like other large mining firms, Eldorado was sometimes cautious: ore development was a tricky business, not to be rushed. Sometimes, however, it took considerable risks. The location of a mine shaft at Beaverlodge, or the design of the mill there, were such risks. It was worth taking the risks because Beaverlodge was the company's future. At the beginning of 1952, Eldorado promised much. It had built up a considerable technical expertise. It had explored, developed, and brought into production one mine and was on the verge of doing the same with another. It handled its own marketing with both aplomb and profit. It was, above all, profitable and dividend producing. By comparison with other Canadian mines it was small, and the industry it dominated was far down the list of Canadian money-makers. Events in the next few years would change all that. It needed another set of events to start things off; it needed another discovery like Gilbert LaBine's in 1930. It needed what LaBine used to call 'an elephant.'

8 Beaverlodge and the Boom Between 1952 and 1955 Eldorado witnessed the greatest expansion in its history. From being a 2oo-ton a year producer of uranium oxide, the company by 1955 had passed 1000 tons and was still moving up. The cause of this growth was the Beaverlodge mine, on the north shore of Lake Athabasca. There, in the early 19508, Eldorado created a mine, a mill, a transportation system, and a town. Eldorado already had 754 employees in 1951, reflecting the development at Beaverlodge, and nearly 1000 at the end of 1955. Sales and other income, a mere $7.5 million in 1951, rose to $25.7 million in 1955. Running the company became more complicated too: the 1954 Annual Report displayed, for the first time, a full-time vice-president and no less than five division managers, not counting the subsidiary companies, Northern Transportation and Eldorado Aviation, the latter established in !953This may seem like the standard story of company finds mine, finds ore, finds profit, finds happiness. To some degree, however, it is also the story of a company discovering the true complexity of corporate life, and not for the last time. In this chapter we examine the question of what kind of mine Eldorado found, how it came to excavate the mine it did, what technology it used and, of course, what it did with its product, and how it managed to sell it. But to begin with we must turn to the question of where the mine was located, and what its location meant.

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The location of Eldorado's Beaverlodge mine was a matter of geology, geography, and history. Geology placed a considerable amount of uranium-bearing ore in the basin of Lake Athabasca, the third largest of the northern great lakes, and the one furthest to the south. The fact that Lake Athabasca lies at 59° 30' north places it to the south of the Northwest Territories — about 30 miles south, to be precise. When, in 1905, the cartographers and the politicians convened to carve two new prairie provinces out of Canada's Northwest Territories, they pushed the territorial boundary all the way up to 60° north. Then a boundary was run along the noth meridian, dividing Alberta from Saskatchewan, and neatly bisecting Lake Athabasca, two-thirds of which is located in Saskatchewan, and the westernmost third in Alberta. The only settled point on the 1905 map of the north country was Fort Chipewyan, at the westernmost extremity of the lake, a trading post since 1788, and still a trading post purveying Hudson's Bay Company goods to the local Chipewyan Indians. Past Fort Chip, as it was called, steamed shallow-draft boats en route from the Athabasca River to the Slave River, carrying freight to the sparse settlements to the north. Because of the rivers, Lake Athabasca's connections ran south and west, eventually to the railhead at Waterways and ultimately to Edmonton. This phenomenon was reinforced in the 19205 and 19305, when Edmonton became north-west Canada's great aviation centre. The Alberta—Saskatchewan boundary, on a political map, and on a transport grid, appears more theoretical and fanciful than it actually is. Oddly enough, the Saskatchewan end of the lake is different from the Alberta end. The name Athabasca derives from the Cree language, and means 'where there are reeds,' an apt enough description for miles and miles of marsh and swamp through which the Peace, Athabasca, and Slave rivers meander on their way to the Mackenzie and the sea. This end of Lake Athabasca is part of the Mackenzie basin and may be counted as a northern extention of the great plains of the south. Nearby bison roam, mingling with herds of caribou from the north; the federal Wood

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Buffalo National Park embodies the fact. The gentle hills of the western end give way abruptly to the rocks and boreal forest of the Canadian Shield some distance to the east, and while the caribou roam, the bison do not. Archeologists have even identified two quite different Indian cultures along the lake, the one at the east end being Chipewyan - still the dominant group.1 Beaverlodge Lake is situated towards the eastern end of Lake Athabasca, just where the big lake begins to narrow towards Fond du Lac. It is separated from Lake Athabasca by a short portage, and it was across the portage that supplies were dragged in 1948 to Eldorado's base camp on level ground at the north end of the smaller lake. The existence of level, or comparatively level, ground, helped the choice of first a camp and then a town site, and finally of an airport, even though the nature of the terrain was suc as to create a slight hill in the middle of the runway. But since the ground was at any rate smoother than it was at Port Radium, the Beaverlodge operation would never face the same extraordinary transportation difficulties that confronted Port Radium; virtually from the first it could count on being in year-round contact, by air or water, with the outside world. The north was the preserve of the Indians, of the fur-traders, and of the occasional prospector. Besides Fort Chip, there was only one other white man's settlement, at Goldfields on Lake Athabasca, near Cominco's abandoned Box mine; its product, from 1939 to 1942, was gold as the name proclaimed. South of the lake there was nothing, barring miles of forest, until Buffalo Narrows on the Churchill River, 250 miles as the crow flew, and from there it was another 150 to Prince Albert, the northernmost large town in Saskatchewan. Almost all of Saskatchewan's population lay south of Prince Albert, and the province's politics and policies reflected this inescapable reality. Wheat from the south was Saskatchewan's priority. It was not that Saskatchewan was bereft of mineral resources. There was lead and zinc from Flin Flon on the Manitoba border. But Flin Flon's output could not outweigh agriculture in the political and agricultural balance, and it is not surprising that Saskatchewan's few northerners felt distanced from the provincial capital at Regina. In Regina there ruled, since 1944, the socialist

FIGURE 3

Beaverlodge area

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Co-operative Commonwealth Federation, better known as the CCF. It leader, Tommy Douglas, was still in his early forties when Eldorado began operations in Saskatchewan, and since Douglas remained in power until 1961 he was, apart from C.D. Howe in Ottawa, the politician with the greatest capacity to influence the company's development. In Canada natural resources belong to the provinces. Eldorado had not had to worry about this before, since in the Territories there were no provinces to intervene between the company and the Ottawa goverment. In 1943, when the federal government banned all private uranium prospecting in its territories, it asked the provinces to do the same and Saskatchewan, which then had a Liberal government, was one of the provinces that complied. Nor were there any objections from socialist Regina to Eldorado's prospecting parties from 1944 to 1948. When Howe announced in 1948 that private enterprise would get a crack at uranium, however, there was puzzlement and no little resentment in the provincial capital. It appeared that Howe's announcement had created an anomalous situation. He had restored the right to control prospecting, staking, and even mining to the provinces. Yet through its Atomic Energy Act and the instrumentality of the Atomic Energy Control Board, the federal government continued to determine the circumstances in which uranium could be mined, and through Eldorado it controlled absolutely its sale. Moreover, Eldorado was itself active in the search for uranium. Just possibly, if an offhand remark by Howe is to be credited, the minister still expected that only Eldorado would ever establish a profitable new mine.2 Mines south of the 6oth parallel were subject to taxation by both the provinces and the federal government. Provinces set conditions on claims and grants, collected royalties and other taxes, and established such regulations as seemed necessary to govern the conduct of mining companies. Eldorado, which was owned by the federal government, might have been considered exempt from taxation either by the federal or the provincial government, but as a matter of policy Ottawa drew back from the creation of a vast, tax-exempt crown economy. If Eldorado was to be a Schedule D corporation, and if those corporations were to conduct themselves

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as commercial entities, then it followed that they should face the same taxes and duties as their commercially owned peers. Government ownership, in such cases, would be treated as both accidental and incidental. Ottawa nevertheless retained an advantage that Saskatchewan could not at that point command. Only Howe and his officials, including Bennett, knew anything about the market for uranium. They therefore also understood what was, and what was not, economical. If, for particular reasons of policy, Saskatchewan still had a financial interest in seeing its uranium deposits developed, for other reasons it was not allowed to intrude on the federal agencies that set the terms for their development. A request from the Saskatchewan government, in 1948, to sit in on either the advisory panel or the Atomic Energy Control Board was snubbed decisively as an intrusion into federal affairs; but it would take months, even years, more before the two levels of government reached a saw-off in their jurisdictional concerns.3 From the point of view of the Saskatchewan government, the development of the north would be highly advantageous. The province had suffered greatly in the 19305 through a combination of low wheat prices and drought that reduced the wheatlands to a dustbowl, and in the 19405 it was still considered a have-not province with a thin margin between apparent prosperity and real distress. It is not surprising that the Saskatchewan government regarded the discovery of uranium on Lake Athabasca with a pleasure alloyed only by its anxiety at the slow pace of its development. But the development of Beaverlodge took time. It was not until 1949 that Eldorado felt able to risk a large expenditure of money at the future mine site, and then only on the strong advice of the company's consulting geologist, B.S.W. Buffam. Buffam had faith in the existence of a large ore body there, no matter how discouraging its initial manifestations might prove to be. Even Gillanders, who was both a geologist and mine manager, the man on the spot, let his enthusiasm flag from time to time in the face of repeated disappointment. And although expenditures at Beaverlodge between 1949 and 1953 increased steadily, not to say exponentially, so also did the concern of Eldorado's executives and

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directors for their investment. When to their existing burdens was added the alternating enthusiasm and complaints of the government of Saskatchewan, it is not difficult to discover how Eldorado's own version of federal/provincial relations oscillated between cordiality and acerbity. There were also doctrinal considerations. The CCF highly approved crown corporations, and some members of that party even adopted Howe as an unwitting hero who had shown the way to a government-owned and operated millennium. Eldorado was therefore, in a sense, good. At the same time, it could not be denied that Howe was strong-willed if not pigheaded in getting his own way, and that characteristic could encroach on the sovereign, or quasi-sovereign, rights of the Province of Saskatchewan. The skirmish over representation on the advisory panel (or AECB, since the object is unclear) showed what Howe would do, if he got his way entirely. And Tommy Douglas, who had sat for nine years opposite Howe in the House of Commons, was by no means an uncritical admirer of Ottawa's Minister of Everything, and was not prone to place his whole trust in the adage, Howe Knows Best. And if Douglas was not, his advisers were even less inclined to follow Ottawa. In June 1948, as the Douglas government was getting itself re-elected, the premier's economic adviser, George Cadbury, wrote to a friend in the British Ministry of Supply, which was responsible for the British atomic program. There was uranium in the north, but 'we cannot persuade the dominion' to pay for developing it, and the province itself could hardly afford it. Since that was the case, Cadbury continued, 'Would the British Government be interested in this development?' If they were, Saskatchewan would frame its mining regulations accordingly, 'to give us or them certain rights in the ore and its development.' Even if Saskatchewan had to concede token possession of the uranium to the AECB there should then be no problem for the British to take 'eventual possession.' The British, however, did not want 'eventual possession.' They were short of dollars, which they preferred in any case to spend on wheat. They had plenty of uranium, and they had it cheaper from the Belgians. Moreover, they were not anxious to be injected into

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the middle of a dominion/provincial squabble in Canada. For these cogent reasons the Saskatchewan initiative was quietly discouraged. Douglas was not finished yet. In September he came east to Ottawa, on the first stage of a trip to Europe. He was going to London for business and pleasure, separately or combined. Part of his business was uranium, and he hoped to have the pleasure of selling it to his fellow-socialists, the British Labour government. The British high commissioner felt it best to consult Howe about Douglas's proposed uranium negotiations, and what Howe had to say alarmed him. In the first place, Howe stated, Douglas wanted money to develop uneconomic deposits. 'This,' in Howe's words, 'was [a] crazy notion, all the more so as Federal Government under their act had complete control.' It was too bad about Douglas, the minister added, who was 'well meaning but trouble was that he "did not know his way around," and had exaggerated idea of value of deposits.' Howe had put his views on uranium to Douglas, or, as he phrased it, had tried 'to put him right.'4 Howe was, strangely enough, successful, perhaps because of a twist he gave to his argument. The only promising deposits in Saskatchewan were already being mined by Eldorado, he told the Saskatchewan premier. Only the marginal ones were being left for private development. When Douglas asked if he could raise funds for the latter, Howe wished him good luck and apparently gave the matter no further thought. He did not have to. Although Douglas mentioned uranium to both the British Ministry of Supply and the British Westminster Bank as a suitable subject for investment, he did not get any money. For the time being, as the Saskatchewan government now realized, Eldorado was the name of the game at Lake Athabasca.5 II

While Regina was subsiding into post-election politics, Eldorado was seeing about its mine, or, to put it as some would have preferred, seeing whether it had a mine. The direct responsibility for Beaverlodge lay with Gillanders who spent more and more time managing the Beaverlodge Project, and less and less at Port Radium, which became the province of his assistant manager.

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Though Gillanders appears as Beaverlodge's first manager, the creative influence there was really B.S.W. Buffam, PH D Princeton and the company's consulting geologist. Buffam was Bill James's partner in Toronto; appropriately he had once been James's student and protege, and had followed his friend to Princeton. Buffam may once have had a first name, but by 1948 it was 'Buff to his friends, and Dr Buffam to everyone else. The years that contracted Buffs name expanded his waistline, but girth was no obstacle to scrambling up and down manways at Port Radium or Beaverlodge, greatly to the disgust of some of those he forced to follow his example. Buffam could be a severe taskmaster. Even Bennett, who dealt with Buffam as an equal in discussion, considered him 'a perfectionist' who wielded 'an ivory-handled bull-whip.'James, his partner, remembered him a little differently. 'His thinking wasn't geological,'James remembered, 'it was mathematical,' which was not surprising in someone who charted the rise and fall of mines by the tonnage in their reserves. (That would be Port Radium's fate, when in 1955 Buffam told the Eldorado board that there was 'now little chance of finding large ore bodies' and placed the mine's life expectancy at four years. It would, in fact, be five, but then it would be over.)6 At Beaverlodge exploration proceeded in several stages. The first underground work was an adit driven through a ridge at Martin Lake, just west of Beaverlodge Lake. Buffam told the board in October 1948 that Martin Lake had turned up some uranium, but there were other showings, too. Also promising were drill results from Ace Lake, east of Beaverlodge, and Eagle, to the north. These justified continued development and the establishment of a semi-permanent campsite at Beaverlodge. 'There was, of course, no certainty that we would have a mine,' Bennett wrote in 1982. 'Buffam was optimistic but Gillanders was considerably less so. I finally came down on Buffam's side.'7 Ace proved to be more important than Eagle. Drilling there turned up considerable traces of uranium, but they were erratic and discontinuous - 'anomalies' as geologists called them. 'The problem was,' as Don Bell, then a summer student on the exploration crew, said, 'that from the surface we couldn't keep in

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the ore.' The ore body stopped, started, wandered. Elsewhere it had not been worthwhile continuing. Buffam, however, thought differently. To find where the ore really was and to make a realistic estimate, he recommended excavating an inclined shaft at Ace Lake, to line up with the upper hanging wall and lower foot wall of the St Louis fault. An inclined shaft is just what the term suggests, a shaft angling into the rock neither straight up and down nor horizontal. Such a shaft is also highly unusual, but Buffam argued that in this case it was absolutely required to plumb the ore bodies usually associated with such faults. The shaft would be sunk to a depth of 450 feet with lateral development both east and west at the 175-foot and the goo-foot level. Such a development would involve considerable resources in men and machinery - $500,000 in all — and it could not then be used for production. The board approved, and underground work at Ace and Eagle began in 1Q49.8 'Try putting equipment in an inclined shaft,' a 1949 veteran later complained. 'Try working at an angle of 50 degrees!' Hauling equipment up and down the shaft took a lot of power, as did the underground work at Eagle Lake and at Martin Lake. The demand made diesel units uneconomically costly; fortunately an alternative existed. The pre-war Box mine had been powered from a hydro station at Wellington Lake, ten miles west of the Beaverlodge town site, as the crow flew. Cominco, its owner, was happy to lease it out, and Eldorado had a ready-made source of power.9 Buying the power was easier than getting it to the work-place. 'Improper supervision,' not to say downright incompetence, forced the company to restring the power lines and call in outside consultants to do it. The result was time lost, and three weeks' delay underground. Delays notwithstanding, Buffam was cheerful when he faced the board to report on 1949*8 accomplishments. There were two groups of claims being investigated, Ace and, to the west, Fay-Ura. Work proceeded on both, and on the half mile of terrain in between. On 10 December Buffam told the board that he could visualize Ace supporting a gooo-ton-per-day operation, with an average grade of 0.1% U3O8. Admittedly, not all the news was in, and Bennett cautioned his colleagues to regard Buffam's estimate as tentative. It would remain tentative until all the underground work was completed.

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Shaft sinking was completed in March 1950 and drifting east and west from the shaft, on two levels, began. The result, Buffam reported in September, was favourable and confirmed his earlier estimate as to grade and tonnage. A test sample of 50 tons would be sent to the Bureau of Mines in October to determine whether the ore was amenable to economic treatment.10 Buffam's work was not yet over. He hesitated to pinpoint a location for the production shaft; as late as February 1951 he told the executive committee that the ore reserves might not be as large as previously estimated. Accordingly, he strongly recommended that no decision be taken with respect to the size or location of the production shaft until the development program for 1951 was completed. The USAEC, which was pressing for production, would have to await events. The executive committee did, however, decide to engage Russell Way, a Toronto consulting engineer, to prepare preliminary plans for a mining plant of 2000 tons capacity. The committee also decided that no decision would be taken on the milling process until the results of the test work then under way at the Bureau of Mines were available.11 Based on the development done to date, it appeared that the average grade of the Ace ore body would be 0.23%. But how best to treat the ore? A process based on acid leaching could be used, but the high carbonate content of the ore would require a high and costly consumption of acid per ton of ore treated. The other possibility was the use of a process that came to be called a 'basic leaching.' Parsons, who was the key adviser on the metallurgy problem, was familiar with work that had been done in this field by Frank Forward, a professor of metallurgy at UBC. Forward was a consultant to Sherritt Gordon in the development of its ore dressing and refining process for the Lyn Lake property. The process had been developed in a pilot plant acquired by Sherritt Gordon in Ottawa, and was carried out in close co-operation with Parsons and his staff. Ross was also familiar with the process since, as a highly competent chemical engineer, he kept abreast of such developments. Parsons recommended and the executive committee agreed that Professor Forward and Ross would be responsible for the development of the basic leach process, using the Sherritt Gordon pilot plant in Ottawa, and that Thunaes would be assigned

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the task of developing a flow sheet using the acid leach process. While, at the time, there was much optimism about the basic leach process, there could be no certainty that it would work until tested in the pilot plant, hence the decision to have a back-up process in the form of the acid leach. Both programs would be directed and co-ordinated by Parsons who would report results to the executive committee for the board when these were available.12 Time and technology were evidently on a collision course. Time was, in a sense, part of Eldorado's stock in trade. Much of the company's importance to the Americans was the simple fact that through Eldorado they saved time — time spent in exploration, development, and experimentation. Much of the advantage of Eldorado's American connection to the company was also time: a prompt and secure purchaser saved both time and motion in sales and complicated corporate planning. Good mining practice, however, did not put as great a premium on time as did good sales practice. It took time and money to prove the existence of an ore body. When an ore body was like the one at Beaverlodge, rambling and irregular, extreme caution was indicated. Metallurgical analysis of the ore was also difficult and time consuming; and as it had done before, Eldorado found it advisable to seek advice from a number of sources. There was also a time-lag involved in implementation. Decisions made in the winter of 1951 determined whether there was any hope of production at Beaverlodge in 1952. Unless orders were placed before spring (and preferably long before that), there was no expectation of inbound shipping before the close of navigation on Lake Athabasca in October. The items needed for a mining plant were, to say the least, heavy, and air transport was therefore not an appealing and probably not a possible option. In any case there were shortages of both material and labour, because of the strain that the Korean War and rearmament placed on commodities; and there was inflation as well. The final decisions on the shape of Beaverlodge were taken in the fall of 1951. First, in September, the executive committee opted for a mill using basic leach and with a capacity of 500 tons per day of feed. It was risky, but the USAEC'S need was urgent - so urgent that they agreed to participate in the risk, as Bennett told the committee

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when it next met, in late October. The risks were not, however, at an end. The location of the mining plant was next to be decided, and in December, at successive executive committee and board meetings, it was. The same urgency that governed the selection of the partially tested basic leach process applied to the location of the shaft and mining plant. Plans for the plant, which included headframe, shops and mine offices, were still preliminary. Construction would have to start in 1952, but as yet there was not enough engineering data available to permit a contractor to prepare a bid. Under the circumstances it was agreed to select a contractor; in consultation with Defence Construction Ltd — another of Howe's crown companies — Burns and Dutton of Calgary was selected. How large should the shaft and mining plant be? The ore reserves on the Ace property would support a 5OO-ton-a-day operation. While Buffam was optimistic that other ore bodies would be located along the St Louis fault, there could be no certainty of this. This was a problem, Bennett told his board, that he had already discussed with Jesse Johnson of the USAEC. As Bennett later wrote, if Eldorado actually went ahead with a 5oo-ton plant, 'it would be time consuming and very costly to enlarge the shaft and the mining plant in the event that further underground development warranted mining at a higher daily rate. Obviously, such an expansion could not be carried out without shutting down mining operations.' Faced with the risk of shut-down or the risk of over-capacity, Johnson chose the latter. The USAEC, he told Bennett, would share in the risk of providing for a shaft and plant with a capacity of 2000 tons per day. The plant and production shaft were planted on top of the Fay-Ura zone, west of Ace along the St Louis fault. Fay-Ura at the time looked most promising, and it was only two years later that exploration revealed that the Verna zone would be the one that would finally push Beaverlodge to its full 2ooo-ton capacity.13 The principal figures in the building of Beaverlodge were Bennett, exercising overall control, Buffam, Gillanders, Gillanders's assistant Robert Sexsmith, R.M. Way, the consulting engineer, and the construction firm, Burns and Dutton of Calgary. Bennett received strong support from his executive committee. Eldon

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Brown, the president of Sherritt Gordon had been invited by Bennett to join the board in September 1950 and a short time afterwards, became a member of the executive committee. Brown was a mining engineer with a very high reputation as an operator and he, together with James and Williams made a formidable team at the board level. At the operating level were Buffam, Gillanders, Gillanders's assistant Robert Sexsmith, R.M. Way, the consulting engineer and the contractor Burns and Button. Eldorado had never had so big a project before, nor one so expensive, and a certain amount of disappointment and recrimination were only to be expected because of the inevitable deadlines missed, budget overruns, and occasional minor catastrophes attendant on a complicated construction exercise. Looking back thirty years later, Bennett took a philosophical view of the three years it took to build the mine. The wonder was not that it went over budget, but that it was as successful as it was. And so, in 1952, the mining plant rose on a hilltop just beside the St Louis fault. A newly built airstrip was just over another hill, and the company's town site was down the road, on the lakeshore. As construction began to wind down, permanent staff began to arrive, and another set of variables came into play. What kind of human environment would Beaverlodge have? What kind of community would it be? Could the success, in human terms, of Port Radium be duplicated on a larger scale? The ability to answer these questions lay only partly with Eldorado; for by 1952 there were other mining companies in the area, and over them all there hovered the Saskatchewan government. For good or ill, that government had some answers. Ill

The CCF government of Saskatchewan was a progressive government in a progressive country in a progressive decade. The 19505 were, in most of Canada most of the time, a prosperous decade, and it showed in what people had come to expect and what they were prepared to expect. They wanted more economic security, and they got it through a variety of social programs. They wanted mobility, and they got it in the form of new cars and highways to

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drive them on. The people wanted to be delivered from outhouses and the backyard pump and oil lamps and, by the end of the 19505, they were. They wanted to own houses in the suburbs, bright little bungalows they could call their own; and, as a result of changes in government regulations and a more forthcoming attitude to development, they usually could. These changes in attitude had their impact on mining and the north, as elsewhere, and on the attitudes of governments attempting to satisfy or gratify what they thought their northern citizens wanted. It was, for example, well understood that mining communities were often unlovely to look upon. Little thought was given to planning of dwelling space, or to creating a family environment. Mining communities were, often, company towns, and in advanced circles company towns brought with them a whiff of feudal capitalism, to be discouraged if at all possible. This view was not discouraged by some of the companies that ran isolated communities in the Canadian bush. The privilege of owning all the land in sight brought with it the responsibility to service it, and to provide for those who dwelled upon it. There were no local taxes, only charges on the company treasury. If the costs could be split with someone else, or if local government could be persuaded to assume some of the burden, a sensible company with an eye to the future would not be likely to object. There were occasional examples of how to do better. In 1919, for example, the Farmer government of Ontario decreed a Town Beautiful at a pulp-and-paper site in northern Ontario: Kapuskasing. The result was, in fact, pleasing to look upon, and all shanty activities of the kind that disfigured so many northern settlements were strictly banned. Of course, just outside the boundaries of Kapuskasing there was a shanty town of precisely the kind the town founders had wished to prevent, but the point, surely, had been made. In fact, two points were made: planning was possible, and the result would not be ugly; but there was a high propensity for local initiative to make a mockery of the best plans that southern bureaucrats could devise. So it would be in Saskatchewan.14 Saskatchewan boasted a hard-working, bright, and imaginative civil service, infused with the idealism of the CCF. Some of them

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may have gone beyond sympathy for the party in power, and it was reputed that the Department of Mines demanded active allegiance to socialist principles from its officers. In Bennett's recollection, 'The staff, including the Deputy Minister, in this Department had little experience and were not particularly well qualified.' The regulations that they administered pre-dated the arrival of the CCF. Saskatchewan law stipulated that mining concessions could be granted to mining companies. In practice, this meant mining companies which could afford the obligations that a concession entailed. They had, in return, a 25-square-mile block of land, which was theirs to explore and develop unhindered for three years. When Eldorado first made its discoveries, concessions round about Beaverlodge were put out for bid. 'It was my view,' Bennett subsequently argued, 'that the granting of large concessions was not contributing to discoveries and I frequently expressed the view to Vernon Hogg, the Deputy Minister, that the Government should discontinue the concession policy and throw all the ground open to individual prospecting and staking.' It was the same dilemma that had confronted the federal government in 1947-8, when it had decided to open uranium prospecting to all comers. The efforts of many in prospecting were preferable to the efforts of a few.15 As we have seen, there was a flurry of interest in uranium prospecting in 1948, after the government abandoned its claim to exclude all private interests from the field. There was another flurry in 1950 and 1951, after Bennett raised the ante. In 1950, the Goldfields area had no fewer than 42 blocks of concessions and 800 individual claims. This was impressive to the uninitiated, and hopeful for those who believed that the law of averages must eventually prevail. 'There have certainly been many damp squibs from Canada in recent years,' a British official minuted on the latest set of rumours from the Canadian backwoods. The lack of attraction shown by uranium mining stocks only confirmed the sceptics in the investment community, regardless of frantic activity in the field. But there were a few promising signs. Gilbert LaBine was reported to have found a property near Beaverlodge, and it was named after LaBine and Johnny Nesbitt, an Eldorado pilot: Nesbitt-LaBine. After the Beaverlodge mine itself, Nesbitt-LaBine

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was the prospect observers rated highest, and its existence gave some credence to the view that Beaverlodge would be only the first among many uranium properties.16 This belief was of some importance in estimating future production, but it was of at least equal importance in shaping contemporary opinions of the direction that mining settlement on Lake Athabasca ought to take. The possibility of a larger mining community was certainly on Bill Bennett's mind when, early in 1951, he flew to Regina to discuss the organization of northern settlement with Premier Douglas, the Saskatchewan minister of Natural Resources, J.H. Brockelbank, and Vern Hogg. The meeting went well. Douglas added charm, but it would be Brockelbank and Hogg who would have to handle whatever conclusions resulted. Bennett presented two alternatives. There could be company towns, one for each mine, inefficient, expensive, unco-ordinated, and ultimately uneconomic. Or there could be one central town site, from which miners would travel to their place of work. Excluded from the town site would be 'key personnel' and single miners, who would continue to live, in Eldorado's case, at the Beaverlodge town site. Naturally Eldorado would make a contribution to any central town site - what Bennett called its 'fair share.' But it would not pay for it all, since central to Bennett's proposition was the idea that cost would be parcelled out among the various interested parties. Saskatchewan's representatives responded warmly. A central town site was a good idea. A well-planned one would be even better. Nobody wanted to see an Ontario-style shack town grow up in the north. Much better would be a planned community that would be a credit to its inhabitants, and incidentally to its planners as well. In Regina, Hogg and his staff set to work estimating requirements and costs, and Bennett flew home under the impression that he had made real progress.1 Progress, however, was slow. It was too slow for the company, which during 1951 was having to build its own facilities simply to get supplies to the mine site. The federal Department of Transport built an airstrip. A port was established at Black Bay, about 15 miles distant, replacing the time-consuming portage between Lake Athabasca and Beaverlodge Lake. The new port was christened Bushell, and Saskatchewan immediately doled out land for ware-

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houses and port installations. The establishment of Bushell, however, led to the next problem, which was how to get from there to Beaverlodge. The obvious solution was to build a road, but what was not obvious was how to pay for it. In February 1951 an arrangement was made. Saskatchewan would build the road, and its cost would be split three ways, with the province, the federal government, and the company each taking an equal share. The cost, estimated at $150,000, was prudently inflated to $200,000, just in case.18 February's prudence became September's 'guesstimate.' The Bushell road's designers had not allowed for muskeg and permafrost. What could be graded in the south had, in the north, to be banked with timber and tons of rock. On that substructure there ran, by the fall, 'a passable road for light traffic,' costing $270,000. Saskatchewan proposed that the cost overrun be shared with Ottawa, but Ottawa declined. Eldorado, which had contributed labour and equipment over and above its cash contribution, does not seem to have been approached, and Saskatchewan bore the extra burden alone. There was never any doubt that the road was needed. During 1952 the road supported 60 local vehicles, from cars to very heavy trucks which rumbled back and forth day and night bringing supplies to the mine. In one 24-hour period, 900 tons of machinery and other material were moved from Bushell to Beaverlodge; by the end of the year the total freight carried on the road was one million tons. The freight was not all consigned to Eldorado; some went to other companies in the area, including Nesbitt-LaBine. Those that could not be reached by truck transhipped onto float planes and flew in what they needed.19 Developments in 1951 and 1952 pointed up the urgency of coming to a firm conclusion on the character and location of the proposed central town site, but other developments simultaneously impeded progress. The most important of these was the failure of any other company to prove a large ore supply. No ore, no mine; no mine, no miners; no miners, no town, or at least no contribution to a town. Simultaneously, there were considerably more than 1000 people working daily on the north shore of Lake Athabasca and making large sums of money with little of a local nature to show for it.

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The existence of money in quantity stimulated an interest in its transfer to entrepreneurial hands. The entrepreneurs, during 1951, tended to hang out in Goldfields, which was still a base for government and other mining companies. There was a liquor store in Goldfields, and soon there was a thriving business for ski-taxis — snowmobiles — ferrying cases of hooch to Eldorado's bunkhouses. Gillanders was not amused at the addition of one more timeconsuming element to his problems, but through an ingenious application of the Atomic Energy Act of 1946, he was able to ban the bootleggers from what had suddenly become a security area. Excessive drinking was made a cause for dismissal, and as far as Eldorado was concerned, the traditional ration of a bottle a month of liquor or a case of beer was all the men were entitled to. Any employee caught bringing illicit liquor back from Goldfields would henceforth be dismissed forthwith. When the Saskatchewan government complained on behalf of its aggrieved taxpayers (the taxi bootleggers), Eldorado responded with a sharp reminder that defence and security took priority over local interests, pointing out for good measure that even the road to the airport, which passed over Eldorado land, could be deemed 'secure' under the Atomic Energy Regulations, forcing Saskatchewan to build its own road around.20 Disputes over the right of company employees to drink liquor in whatever manner they chose were more symbolic than substantive. The main act was lurking just over the horizon, and its effects would still be visible a full thirty years later. Saskatchewan wanted a beautiful town in the north. Its officials investigated town planning in Manitoba and the fully planned company town of Arvida, Quebec. Arvida came to seem almost ideal to the planners in Regina and by October 1952 a full report on that town was ready. The only problem was that by October 1952, an unplanned town had been in existence for almost a year.21 The name came first. Just who named Uranium City is a matter for dispute. What is certain is that the name was fixed by September 1951. Like 'Eldorado,' it was a promoter's name. It conjured up visions of a mining metropolis sitting atop a great lode of uranium, and for prospectors and promoters looking ahead to public stock issues, that was just the ticket. The Saskatchewn government hesitated, but only briefly. One civil servant complained that the

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town would inevitably be called 'Urination City' instead. Why not some name more in keeping with the region, such as 'Fredette' or 'Beaverlodge'? As for the humble Bushell, it could be renamed 'Peace' or better still 'Port Peace' in tribute to the deterrent qualities of nuclear weapons. Confronted with these suggestions, the Department of Mines and Resources decided that on balance Uranium City had much to commend it. Perhaps 'city' was ambitious, considering that 'there is nothing there at present except a road.' But it might well be a city, especially if advertised as such, and if any 'immature mind' wanted to pervert the name, there was nothing to be done about it. The name stuck even if it betokened 'a typical mining boom town built on solid rock... rather than the beauty spot that it is or will be.'22 The beauty spot still had to find somebody to pay to make it so. In Regina's collective mind, somebody meant anybody else. T think it proper,' one civil servant wrote, 'to state that in my opinion we have passed a turning point in the thinking of the people of this Province. No longer are they prepared to allow speculators and industrialists to harmfully, and for their own selfish pecuniary interests, to [sic] exploit the renewable and non-renewable wealth of Saskatchewan.' Happily, 'Saskatchewan is fortunate in having in its department of natural resources an administration which has the vision and foresight to support a worthwhile development' in order to benefit not only investors but also 'the people involved in making a success of a plant whether mine, sawmill or factory.' What these lofty principles added up to was the demand that Eldorado fork out $600,000 (actually, because of a mistake in addition, $700,000) for water mains, sewers, power lines, a community centre and recreation grounds, and a lo-bed hospital. The government would set the standards to be applied, and would appoint a local administrator to carry them out. This investment was just the beginning. Eldorado would in the future be responsible, under direction, for road repair and snow removal, fire protection and electricity, as well as all other normal municipal services.23 This situation was just what a central town site was supposed to avoid. In Saskatchewan's proposal, Eldorado would not own or control the town, but it would pay for it nevertheless. On meeting

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Deputy Minister Hogg in November 1951, Bennett told him that the company could not contemplate signing Saskatchewan's terms. Eldorado had never planned on picking up all of Uranium City's expenses, but on sharing them. That was the crux of his discussion with Douglas and Brockelbank in January; unfortunately it had not registered. Admittedly Eldorado was for the time being the only viable company in town, but that was because other companies had been discouraged by Saskatchewan's policy of exclusive three-year concessions, which had not helped but actually hindered mining development. Under the circumstances, Bennett concluded, Eldorado would have to delay; possibly it would have to keep its work-force entirely on its own property at Beaverlodge.24 That might solve Eldorado's problem, but it would still leave a massive headache for the Saskatchewan government. Goldfields was inconveniently located, and it was inevitable that squatters would move from there to the main axis of transportation. Since no action had been taken to survey lots at the Uranium City site, just beside Martin Lake to the west of Beaverlodge, the squatters would undoubtedly settle down at Bushell. 'There is no way,' Bennett pointed out, 'that you can prevent squatting at Bushell unless you are prepared to police the area. This may sound easy in theory; in practice, I am quite sure that it would lead to great embarrassment ...' That embarrassment would be public and political.25 Brockelbank responded by saying that it was all a 'misunderstanding.' All he and his department wanted, he told Bennett, was to avoid spending their own funds on 'a townsite in an isolated area which is primarily required to service a mining development.' It was possible to find money for a modest expenditure on surveys, but only if Eldorado would agree to a per capita grant for its employees living in Uranium City. Never, Bennett replied. How could there be any agreement when his company had actual or planned expenditures at Beaverlodge of $13,278,312, while to date Saskatchewan had contributed one third of a road - $91,000? The only point of agreement was for the province to grant industrial leases at Bushell to users like Northern Transportation, which had until then (July 1952) been denied even a storage area.26 By July 1952, eighteen months after the subject of Uranium City was first raised, it was too late. Belatedly Saskatchewan surveyed

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100 lots, and Eldorado cleared enough bush to open seven or eight blocks. With or without the surveys, Uranium City was about to be peopled, as officials at Goldfields had been warning since the previous fall. As one official wrote in March 1952, 'It is going to be very difficult to keep people from moving regardless of what stand we take.' People in the north took the view that it was their government's job to provide for them, and not Eldorado's. Northern people, the same official wrote, 'think our idea of a "model town" is very nice but they say they are the ones who are going to live in it and if they are satisfied to start out without water and sewer and modern conveniences they do not see why we should stop them. The entire blame for any delay in the movement is definitely being placed upon the Government and our Department [Mines and Resources] in particular.' Unless the department moved fast, 'the people will move' anyway. How would the department like the publicity that would attend tearing down unauthorized buildings, however squalid?27 Once the movement started, it went very fast. A hundred lots became three hundred. Streets were laid out and buildings erected. In one respect, the Saskatchewan government proved to be abreast of the situation: the liquor store was one of the first buildings in town. According to a contemporary government report, some of Uranium City's new citizens simply moved over from Goldfields (the Goldfields buildings were hauled over in the winter of 1952—3), while others filtered in from Yellowknife to the north. 'Mining people came from everywhere, chiefly Ontario. Numerous natives, mostly Metis, came from surrounding villages of Goldfields, Camsell Portage and Fond du Lac.' These tended to stay out of the town proper, 'in cabins in the woods beyond the survey.' No survey meant no services, but it also meant no taxes. It came to pass, therefore, that Uranium City's first inhabitants were 'white people in business or intending to be in business.' To encourage its employees to move there, Eldorado offered lowinterest mortgages covering 90% of house costs, and to explain this policy, Bennett himself came to Uranium City to address a public meeting. So far, by the winter of 1952-3, local initiative with a minimum of public assistance had created Uranium City. None of the

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outstanding issues between the province and the company had really been settled, and with a small town now on its hands, the province was getting itchy. It happened that for reasons unconnected with the town site, Eldorado was in the process of replacing both Gillanders, the local manager, and Sexsmith, his deputy. (We shall examine what happened below.) Gillanders' successor as manager, Dick Barrett, would not arrive full time until the spring of 1953. It is not surprising that Saskatchewan officials discerned 'a poor relation between Eldorado Director, Mr. Bennett, in Ottawa and his subordinates in charge of field operations. These individuals do not appear to be aware of head office policy in some instances, and their decisions made locally are occasionally not supported in head office.' Despite the confusion, Saskatchewa proceeded to install a local administrator, moved over from the vanishing Goldfields, and established a mining recorder's office. The federal government contributed a post office, and private enterprise established two stores, a garage, and a restaurant. There were enough children in evidence to justify a school, and when it opened it was swamped with 60 pupils.28 As predicted, Uranium City's citizens had great expectations matching the optimism of their town's name. Those who came from Yellowknife, in federal territory, pointed out what Ottawa had done up there, with a reputed expenditure of $6 million. This led some, at least, of Uranium City's inhabitants to expect 'a major contribution' from the province. 'The local people,' according to a provincial analysis, 'are inclined to be over enthusiastic and optimistic.' Probably they were; but the province's attitude towards them was anything but receptive. When a delegation came up from Regina to review local complaints, they described their reception as a mixture of common sense and downright abuse. When, in February 1953, the local people complained that the province had established a liquor store but not a hospital, an official was inspired to reply that he would gladly equalize matters by closing the liquor store. 'Needless to say,' he happily reported, 'all opposition in that regard collapsed.'29 The apparent ingratitude of the new northerners did not enhance Regina's regard for Eldorado, which was viewed as the root cause of the government's northern troubles. This

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attitude certainly informed a letter Brockelbank sent to Howe on Valentine's Day 1953. In it Brockelbank claimed, wrongly, that Eldorado had made an agreement with the province back in 1951. Since then, all Bennett had done was reject the fair and reasonable proposition that his company pay most or all of the administrative freight at Uranium City. Now the company was building its own town site and even considering establishing its own school there. If it could not get the money one way, Brockelbank continued, it would get it another, through assessment and taxation. Since Bennett was absent when Brockelbank's letter was received, Howe could only respond by cautioning Saskatchewan not to kill the mining goose that laid the golden eggs, and by arguing that it was customary that a province should bear 'a considerable part of the capital expenditure involved' in developing new settlements.30 Delay did little to clarify matters. Since no accommodation was reached, Saskatchewan proceeded to amend its Northern Administration Act, creating the Local Development Area of Beaverlodge. It then proceeded to assess mine property for taxation, said taxation to begin when mine production did. Since it was by then the spring of 1953, Eldorado's start-up was only a matter of weeks away and the concession, as far as the company was concerned, was not particularly generous. To prevent Bennett from taking shelter inside his own town site at Beaverlodge, the government prohibited all commercial development there, and forbade accommodation at the mine for anyone except senior staff and single men. An advisory council to the local administrator was also established, and the mines were granted representation on it.31 Once Saskatchewan had taken decisive action in regulating government in the north, relations improved between province and company. A meeting between Churchman of the resources department and Bennett in June 1953 produced what the former called 'a very interesting and pleasant discussion.' Eldorado, Churchman was assured, would happily pay its share of road maintenance costs, in the hope and expectation that other mines, such as Nesbitt-LaBine, would pay too. The provincial administrator could count on the company's co-operation; presumably with all his other problems, he would have his hands full.32 With this happy denouement the reader may well be wondering

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just what the preceding two years' fuss was all about. As was the case with the mine's own internal development, its external relations were a classic example of time and circumstance being out of joint. Because company towns were becoming unfashionable, and because they were administratively cumbersome and expensive, there was a predisposition on both sides, Saskatchewan's and Eldorado's, to avoid repeating Port Radium's experience to the south. In any case, the clumsiness of the company-town arrangement increased directly with the size of the anticipated population as well as the extraneous factors - other companies, other mines that were expected. And so it made some sense to establish a town that, in property arrangements, appearance, and eventually government would reproduce the garden suburbs then springing up all around Canada's southern cities. In the case of a distant northern settlement far beyond the usual settlement line, a heavy initial capital investment was necessary. Split four or five ways, as Eldorado had originally hoped, the burden would not be great; but as other mining companies in the area either despaired or delayed production, the burden landed squarely and solely on Eldorado. It was not unreasonable that the company pick up much or even most of the capital expenditure on schools and hospitals, since there was no corps of local-property taxpayers to pay for them, but it sometimes seemed that the government's reluctance to share the burden went beyond what was customary in developments further south. Saskatchewan's reluctance may be explained as the reaction of a province that considered itself to be relatively poor and relatively disadvantaged, compared to the vast resources of the federal government and its crown companies; it may be, too, that the sudden flowering of the north upset the province's own scheme of priorities, threatening it with unexpected and unwanted expenditures.* However difficult the province's financial position was, it is undeniable that a considerable gap existed between planning and * One obvious precedent, and one noted at the time, was Yellowknife. At Yellowknife, in 1947, when a hospital was established, it received 'a sizeable contribution from the Federal Government' as well as from the mining companies, the Red Cross, and the local community. See Ray Price, Yellowknife (Toronto 1967), 228.

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reality in the north. Uranium City was a perfect example of a planner's dream turning into a nightmare, and for that Saskatchewan must bear most of the responsibility. The province moved too slowly in preparing for Uranium City, and was caught without much more than a town site. Even the streets might not have been laid out in regular fashion had Eldorado not hastily lent construction crews and bulldozers. Aesthetics, however, gave way to growth; as Brockelbank's officials reluctantly recognized, it mattered not at all to Uranium City's inhabitants whether their house was beautiful as long as they had a house and an opportunity to hold a job, run a business, and make money. IV

From the first, Uranium City was run on different lines than Port Radium. Yet Eldorado people moving down found the place strangely familiar. There was plenty of community spirit, as there had been further north, and lots of co-operation. Neighbours helped put up or pull down one another's houses, set up rinks, established teams, and enjoyed a summer almost as spectacular and slightly longer than the one at Port Radium. Those who lived at Eldorado's town site near the mine found most of the amenities that Port Radium's inhabitants enjoyed, along with all the usual paraphernalia: mine manager's house, staff house, barracks and the like. At Beaverlodge, unlike Port Radium, married miners could bring up their families, and they could even own their own homes. At home, their connections would most likely be with their own immediate neighbours, who might or might not be Eldorado employees. Food could be procured at the Hudson's Bay store, and cooked at home, but for those who desired it there were restaurants. Since there was a provincial liquor store, the old prohibitions went by the boards; but then so did the exorbitant prices extorted by the sober during the parched periods of breakup and freeze-up. As for its appearance, Uranium City was about average for a northern community, which is to say unappealing to the southern eye. Lest the reader think that this is simply the normal opinion of a captious southern aesthete, we will simply cite the impressions of

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Saskatchewan's provincial treasurer, Clarence Fines, who visited the place in June 1953. Fines bluntly characterized Uranium City as 'a shack town.' Why should this be so? Part of the blame, he wrote, was the province's policy of conceding 33-year leases. 'You and I,' he told his colleague Brockelbank, 'can probably appreciate the fact that a thirty-three year lease is just as good as a title, but I heard dozens of complaints in the short time that I was there.' To people who wanted to own their own homes, it seemed pointless to build something that might last longer than thirty-three years, and they met the challenge by building structures that would last a great deal less. All this, Fines added, was despite the fact that 90% mortgages and an extra 5% contribution by Eldorado made the immediate cost of housing derisory. Water supply was another difficulty. Water came from Martin Lake, either in a water truck or by the bucketful. Since there were no water mains, there was very little fire protection. As if to emphasize the point, on the night of Fines' arrival the local bakery burned down. It would have been better, the treasurer drily commented, to have built the water main (possibly even if the government had paid the shot) because all of Uranium City's insurance was with the Government Insurance Office, 'so that two or three good fires could cost the Government, indirectly, more than the cost of providing a water tower.' The government had insisted on some local improvements, remnants of its plan to make Uranium City a City Beautiful. There was, for example, a row of parched trees down the middle of the streets. 'I would recommend that these be removed immediately,' Fines wrote. 'They are not only a fire trap but they make parking practically impossible... They ...are a real menace.' This was because the main road from Bushell to Beaverlodge passed through the centre of town, and because the Athabasca county is, in terms of rainfall, a semi-desert. Dust coated the trees, causing Fines to suggest that the province could probably spare the money to oil the roads occasionally. There was one bright spot in the treasurer's catalogue of mishaps. Soon a new hotel would be opening, he wrote, and in his opinion, 'it is going to be a real credit to the community. In fact, it will be a better hotel than you will find in Price Albert.' It

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would also, along with the liquor store, be Uranium City's most consistently profitable institution.33 We may at this point anticipate what was going to happen in Uranium City in the next four or five years. The town grew. By 1958 it boasted 5500 inhabitants (some of whom lived outside the town at mine sites). It had taxis, movie houses, banks, and several kinds of stores. It had buses, which commuted to mine sites several times a day. The married men travelled on the buses to work, and in the early years, before water mains, to have a hot shower. As a special service, the company allowed miners to drop off orders for grocery at the commissary, and to pick up their orders at the end of their shift. Eventually the volume of business outgrew the space available at Beaverlodge, and Eldorado opened its own retail operation in Uranium City — a comprehensive supermarket with prices kept comparable to prices in Saskatoon, the closest large city. To run the town, there was eventually an elected town council. At first the Eldorado manager sat on the council ex officio, but that situation did not last. The company did, however, help finance the town through debentures and later built its own housing, which was rented at far below market rates to Eldorado employees. Rental accommodation would prove extremely important to the future of Eldorado and of other local mines, since the mining population in the north tended to move on as opportunity and higher pay dictated. Many stayed, of course, and for a number of years Eldorado profited from the services of a stable inner core of employees; but there was seldom a year in which the company did not exert itself to recruit new employees and to keep old ones. This was a familiar story at Port Radium too. There was one element in Eldorado's relations with its employees however, that had not existed at Port Radium, and which we shall consider later in the chapter: a labour union. In looking for the origins of the labour union we must return to the summer and fall of 1952. V

The increasing complexity of Eldorado's affairs, which now included the necessity of dealing diplomatically with a second government, stimulated several refinements to Eldorado's organ-

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ization. What had been a small head office — Bennett, Harry Haydon, and Bert Powell, Haydon's assistant — which functioned with the assistance of specialist members of the board of directors, started to grow. As Beaverlodge loomed larger and larger, Bennett gave thought to hiring a special assistant, someone knowledgeable in mining, who might shorten the reaction time between information and action between mine and head office. It may well have been, as Saskatchewan observers believed, that communication between Ottawa and the western divisions of the company was faltering, a sign that the system was becoming overloaded. Certainly Bennett was confident that he had enough work to parcel out. The man Bennett settled on was a veteran mining executive, Roy Henry. Henry had effectively retired from active work as a mine manager, but he was still shy of retirement age, and not averse to providing Bennett with what he thought would be technical advice. Bennett had other ideas, and from the moment Henry joined the company, in August 1952, he was called on to fill in as a kind of roving crisis manager. The principal crisis that he had to deal with was at Beaverlodge. Gillanders's relations with Bennett and the board had been showing signs of strain. As manager, Gillanders had four responsibilities, apart from his authority over day-to-day operations. He had, first, to oversee the development of the mine, that is, the development of ore faces to feed the mill its daily tonnage. Next, there was the construction of the mining plant, including shaft, hoist, and the primary crusher for the ore. Third, there was the mill, and lastly the town site. The construction of the mining plant and mill were the responsibility of Russell Way and Burns and Button, the contractor. The mine development program and the town site, Gillanders delegated to Robert Sexsmith, his deputy. The entire project was plagued by cost overruns, but progress on the mining plant and mill was steady and, in the board's view, satisfactory. The mine was another matter. The mine development program was lagging badly, so much so that there was a real danger that ore would not be available to feed to the mining plant and the mill on their completion. As the situation deteriorated, pressure on Gillanders increased. Gillanders was not the only executive under

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fire. 'I may say,' Bennett later stated, 'that I had been under some pressure from Charlie Williams and Eldon Brown' — executive committee members - 'to do something about the situation.' Bennett did, and Gillanders departed as did Sexsmith.34 The situation was simplified by the inclination of the USAEC to participate in the risk, but the strain of financing an extensive plant on the basis of a calculated risk at a time when the Port Radium mill had just burned down was considerable. If anything, the circumstances increased the pressure for completion of the Beaverlodge plant and mill. Russell Way, the consulting engineer, bore some of the consequences. The 'Way Programme,' which became the master plan for the mining plant, set the cost at $5.9 million. By February 1953, the price had risen to $8.6 million, and there was no end in sight. It could not all have been predicted. Rock ledges were lower down than expected, and therefore more concrete had to be poured as a foundation. Low water on Lake Athabasca and the Athabasca River prevented Northern Transportation from getting through, and its cargo had to be flown in at heavy cost. Estimates for room and board for the construction crews, for tradesmen's wages, and of course for air and water transport were all too low. That was beyond Way's control. Other problems reflected on the manner in which Beaverlodge was being managed. A subsequent report by Roy Henry singled out the 'cost of handling materials and equipment in the yard and inadequate warehousing.' This was a delicate way of saying that cargoes arrived, were raced to the mine site at great speed by truck from Bushell, and dumped to permit the truck a quick turn-around back to the docks at Bushell and the next load. What happened to what the truck dumped was occasionally a matter of speculation. Bill Gilchrist, a Weyburn native whom Bennett hired to be assistant manager in January 1953, remembered that blind luck and blind faith seemed to be the principles on which warehousing was carried on. It did not help that the warehouseman had been fired, and in revenge had taken his records with him. Winter covered the piles of supplies with a light dusting of snow, which made the search for the various items in demand picturesque as well as time consuming. There were other problems, this time personnel-related. There

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were two different sets of workers on site. There were Burns and Button's employees, flown in from Alberta, and paid an isolation premium. There were Eldorado's own employees - 321 by December 1952 - who did not get isolation pay. They did not care that Burns and Button's people were seasonal not permanent like themselves. 'This caused dissatisfaction amongst Eldorado employees, both junior staff and hourly rated.' The dissatisfaction was reflected in labour turnover. Buring 1952, 551 of Eldorado's Beaverlodge employees departed - a 170% turnover. Asked why, the mine management replied that 88 had been fired, and that of the rest 82 blamed 'general dissatisfaction.' Another 92 cited wages, and 137 'personal or family reasons.' It did not help that the miners were expected to sleep in rows of sleeping bags on barracks floors or even large tents: as Henry later explained, 'Sleeping accommodation was inadequate both for hourly rated men and salaried personnel.' And although Eldorado allocated more money for bunkhouses and staff apartments, it also reduced their quality because of uncertainty over ore grade and reserves. This may have increased dissatisfaction among the normally stable complement of junior staff at the mine: 71 left during 1952 and 11 were actually fired.35 Eleven dismissals among junior staff, confusion in the handling of supplies, escalating construction costs, and reports of selfdefeating management policies were signs of a crisis of at least a moderate order of magnitude. To deal with it, Bennett turned to Roy Henry, his new assistant. For the next six months Henry found himself helping to plug the gap. For the longer term, Bennett selected the professor of mining engineering at the University of Toronto, R.E. (Bick) Barrett; to assist Barrett he chose Bill Gilchrist, another engineer with considerable managing experience in western and northern Canada and the United States. Barrett and Gilchrist would see the mine into production, and production was scheduled to start in April of the next year. It was only just that good news should follow bad, and the tenor of reports from Beaverlodge began to improve. Poor progress on the production shaft was ascribed to incorrect procedures in hauling rock. But ore reserves were increasing, and the grade of recovered ore was relatively high. Stockpiles were beginning to

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accumulate, ready for the start-up of the mill in April. Tuning up of the plant duly began on 18 April, and on i June continuous production started. This was good news. It gratified the USAEC, which as principal customer was delighted to see the increase in Canada's uranium-producing capacity that Beaverlodge represented. It pleased Eldorado's board, which must have regarded the risks it took as worrisome, however justified they might have been. By forcing the pace, Eldorado naturally anticipated difficulties. These were probably no greater than at any other fast-moving construction project; inevitably everything can be planned, as the experience at Beaverlodge showed. But the discontent with living and working conditions among the work-force was a more lasting legacy than the company would have wanted — more lasting even than the anticipated start-up quirks of the novel milling process. Finally, there was the question of why the Way Program had gone so far over budget. In Bennett's view, thirty years later, it was principally a question of faulty estimates, rather than of any great defect in the program itself. Way never had enough time to complete his plans; working under great pressure, he nevertheless did the best he could with much less time or information than is normally available. The Way Program finally produced a mine that would function successfully for twenty-nine years, a considerable span in an industry dependent on the exploitation of a wasting resource. It was not only Eldorado that was busy in Beaverlodge in the spring of 1953. With Uranium City an open town, accessible by air and, in summer, water, there was no one to prevent ordinary citizens going about their business. Some of that business was union organizing. There were two competing unions. First there were the Steelworkers, a non-Communist union approved by the AFL-CIO to supplant the existing Communist-influenced Mine, Mill and Smelterworkers' union. Mine Mill, as it was usually called, had a long history of activity in the United States and Canada. It had gone into a decline in the 19408, in the wake of charges that it was heavily infiltrated by supporters of the Communist party and the charges had considerable substance. It was sustained by the loyalty of its members and particularly by its Canadian locals, which were not as inclined as its American branches to desert an organization that in their view had served them well.

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Mine Mill had taken note of the expansion pending in Canadian mining as early as 1951. In June of that year, the union's British Columbia District executive board had noted with dismay that for some time their union's record had consisted of little more than holding its own. Now, if it was to progress, it must go on the offensive. Organizing in the north looked like a good target, and it was duly approved. But nothing much was done until January 1953, when the executive board again reflected that 'Mine-Mill had been criticized in the past for waiting too long and then finding other organizations well-established.' The best place to try was in Saskatchewan, which had extremely liberal labour legislation, and mentioned among the targets listed was Uranium City.36 (The fact that Eldorado came under federal labour law was not, at that point, considered.) Eldorado was not blind to the likelihood of union organizing; its management would certainly have preferred that any union on its property not be Communist-tinged. In 1953 there was still a strong perception that war with the Soviet Union was entirely possible. The American nuclear weapons program was aimed at deterring the Soviet Union, and at defending Europe and North America from the possibility of Soviet aggression. It was logical to assume, as their record demonstrated, that domestic Communists shared more than a sentimental attachment to the Soviet Motherland. In the relatively recent past, certain European Communist parties had ordered industrial action in support of their political objectives, and it was not beyond the realm of possibility that Canadian Communists might do the same. In the Great Lakes, the Canadian government was in the early 19508 planning the downfall of the Communist-dominated Canadian Seamen's Union by the antiCommunist, though brutal, Seamen's International Union. It was not unnatural under the circumstances for a Canadian crown corporation to hope fervently that it would be spared the pain of dealing with a group of men whose leaders subscribed to the infallibility of the Communist Pope in Moscow, Joseph Stalin. Mine Mill organizers were not at first encouraged by what they found at Uranium City. They made progress at Nesbitt-LaBine and at the tiny Beaverlodge mine (not to be confused with Eldorado's own property). But at Eldorado, the largest mine, they discovered the son of an eastern labour official, 'working on the

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company's office staff while trying to organize for the Steelworkers. At the same time, Eldorado barred the Mine Mill organizers from their property, using the provisions of the Atomic Energy Regulations. These initial disadvantages notwithstanding, it was Mine Mill that prevailed, and in very short order. An application for certification was made on i May, indicating that a majority of the men had signed up. Certification took place, and bargaining began.37 Because Eldorado was the largest company in the Beaverlodge area, Mine Mill attached special importance to negotiations there. The negotiations, however, did not go smoothly. Eldorado exercised its powers under the Atomic Energy Regulations to ban known Communists from its property. Under a compromise, union representatives who submitted to a security screening were allowed on; others, such as Mine Mill's chief bargaining agent Harvey Murphy, were confined to Uranium City. This did not preclude contact between company officials and Murphy; Dick Barrett, the general manager, found Murphy engaging and not entirely unreasonable. But that did not mean, in Bennett's view, that the company should or legally could forego its right to enforce security regulations. Murphy, for his part, complained of the 'horrible language' of what he styled the Atomic Secrets Act, adding that insistence on the company's absolute right to dismiss anyone for security reasons as 'almost needless,' because 'we certainly are not going to interfere or be able to.' Both sides were probably right. Bennett could not abrogate Eldorado's duty to demand security guarantees from its employees. Eldorado was a defence industry, and its product was used to make nuclear weapons. Under the circumstances, it would have been wildly negligent not to have demanded security screening of its employees, not least because certain subjects such as the actual tonnages sold to the Americans were still regarded as strictly secret. Yet there is no evidence that Murphy was lying when he argued that security, as far as Mine Mill was concerned, was 'almost needless.' Mine Mill signed up members in Uranium City because it had a reputation as an experienced and capable union, dominant in nearby mining areas such as southeastern British Columbia. Not all of the union was Communist-dominated; the Liberal MP for

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Kootenay, Jim Byrne, was a member, and union locals in his area were emphatically not Communist. In practice, company officials conceded that the Byrne side of the union was what counted in Uranium City, and that Mine Mill's attractions for local miners did not include its sponsorship of peace rallies or concerts by Paul Robeson. Byrne acted as a go-between in negotiations, and while the first contract went the whole legal route from local bargaining to the appointment of a conciliation board, both sides found it possible to reach a satisfactory agreement. Mine Mill's main point in bargaining was the achievement of wage parity between Eldorado and Cominco at Kimberley and Inco at Sudbury. The company argued that its operations belonged in a different and less secure category from those of the two Canadian mining giants. The conciliation board tended to agree with the company rather than the union on that point, while conceding the validity of a higher wage scale. Bargaining took ten months in 1953—4, and the final contract was not signed until fourteen months after the formal application for certification in May 195 3-s8 It is fair to say that company officials, and particularly those at the mine, did not welcome Mine Mill with open arms. The presence of a union was complicated, time consuming, and occasionally productive of tension. Company officers at Uranium City were sternly and strictly instructed as to what they could or could not do, much to the disgust of some of them. But relations between company and union lurched along all the same. During the period covered by this history, there were no strikes and only occasional disputes that demanded very much in the way of negotiation or conciliation. VI

All this development at Beaverlodge had to be paid for. The amount, rate and kind of payment exercised a major influence on the development of the mine, and these subjects were the focus of an extremely complicated series of negotiations between Eldorado and the United States Atomic Energy Commission. Both sides wanted a mine, but the USAEC wanted it faster. Their anxiety derived from the latest perceptions by the u.s. Chiefs of

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Staff that the American bomb program must be accelerated. When, in the fall of 1951, the military told the USAEC that ore procurement totals should rise to 10,000 tons of uranium oxide a year, the Raw Materials Division, which thought it was doing well to get 3600 tons, was nonplussed. The military, after referring the matter to Truman for a decision, succeeded in getting its way.39 Truman's decision was taken on 17 January 1952, and it leaked almost immediately through a congressional conduit. The leak did not come soon enough to affect a discussion between Bennett and Johnson on 19 January. Johnson learned from Bennett that the Eldorado board had calculated the loss from the Port Radium fire at $4 million. This was so large a sum that it could well imperil the speedy and complete development of the Beaverlodge operation. Bennett added that he did not think that the Canadian government was ready to step forward with $4 million; it had its own priorities, and Eldorado's accidents did not rank high among them. Johnson took Bennett's opinion under advisement, since it would be of considerable concern to the USAEC.4° This was the first step in an elaborate financial minuet that lasted for many months. The principal point at issue was, of course, at Beaverlodge. The greatest risk that Eldorado faced was that the basic leach process might not be effective. As the reader will recall, the design and engineering of the flow sheet was based on a pilot plant test in Ottawa of only 50 tons of ore. Under normal circumstances, the process would have been tested for a period of at least a year and in a pilot plant located at the mine. This, in fact, was Parsons's recommendation. While sound mining practice dictated such a course, its adoption would have delayed the commencement of production for a period of at least 18 months to 2 years. Bennett put the problem to Johnson. Eldorado was prepared to proceed immediately with the construction of the new mill but only if the USAEC would agree to share the financial risk. After some hesitation, Johnson agreed but in private wrote, T believe that the Canadian Government should finance all, or part, of the Canadian program as its share of the common defense of the hemisphere. It is quite likely,' he added, 'that the Canadian Government will be willing to do this.'41

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It was, in fact, quite unlikely. Howe had settled the uranium business on a sound commercial footing. He seldom had to ask his colleagues for funds, and they needed to do little more than nod when Howe told them what Eldorado would be sending in any given year. (For example, on 24 January 1951 Howe formally asked his colleagues to approve Eldorado's 1951 expenditures of $3.5 million. Although not the least important item on the cabinet's agenda, this subject vied with the Anglo-Canadian wheat agreement, immigration, security, the Korean War, and distant radar warning lines for attention.) The minister was unwilling to change this happy situation, especially in a year when a large-scale defence program was stretching the budget to unprecedented peacetime levels. Bennett, for his part, was happy with his mandate, and he was unwilling to open the possibility of having to justify his costs and his administration to an agency of a foreign government however friendly that government might be. It was not surprising that under the circumstances the first negotiations that looked to some kind of u.s. guarantee of Beaverlodge production were unsuccessful. Every kind of assistance was examined, but they all carried a price tag: American scrutiny of costs. As the executive committee's minutes put it, 'the basic principle of our contractual relationship [was] that all production shall be sold at a fixed price.' To get a fixed price, Eldorado would rely on its own resources and on a bank loan until it had concentrate to sell. True, the company knew that it would then have a willing buyer. Johnson and Bennett now worked out an agreement that provided that the company would sell the USAEC, subject to Canadian needs, all the uranium it produced for a ten-year period. As regards price, during the first year of operations, the breaking-in period, the price would be based on the estimated cost. Following this period and for the balance of the contract, there would be a fixed price. This agreement, the executive committee approved, but in so doing, expressed some concern as to the advisability of fixing a price for a ten-year period. This concern does not seem to have affected the basic principles that had already been established.42 By 1952, Eldorado had been dependent on American business for ten years, and in hindsight it would seem natural that the

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relationship continue without interruption. The Americans were good customers, they had no exchange problems, and they were a growth market. But 1952 marked a turning point in a number of ways. American demand was about to balloon the Canadian uranium industry into a resource giant. From a small entry in the balance of payments, uranium would become a very large one. From a working force of under 1000, uranium would move to one of 10,000. It would not have caused much political distress if the government had been forced to close one small company town on Great Bear Lake. But what if the bottom fell out of the uranium market and the government had to close two, three, or more towns? In setting up Beaverlodge, Eldorado had done more than expand its own horizons. It had opened a new era in the uranium industry as a whole. It was now up to the government and, in particular, C.D. Howe, to weigh the consequences, and to decide if the political risk was worth the immediate economic gain.

9 Beaverlodge and the Boom: II In the middle of August 1952, C.D. Howe set out from Ottawa to tour the small empire of the u.s. Atomic Energy Commission. From the USAEC'S standpoint, there was no better time to host a visiting fireman. The commission had embarked on a multibillion dollar expansion program, responding to Truman's decision to accelerate nuclear weapons production. Vast, costly, brand-new plants were approaching completion. Collectively sprawling over thousands of acres, they symbolized American determination to build a nuclear stockpile second to none. Gordon Dean, the USAEC chairman, attached great importance to the impression the commission would make on Howe. Howe was the man who would ultimately decide the shape and extent of Canada's contribution to the u.s. atomic program. In the view of some commission officials, Canada ought to be ready to make a direct, public contribution to the expansion of uranium mining north of the 4Qth parallel. But if Canada was unwilling, they were ready to step forward with up to $25 million in subsidies for exploration. For various reasons, however, the Canadians were reluctant to accept. One sticking point was Howe himself. As Bennett later remarked, 'While Howe was interested in the success of the Beaverlodge project, to put it frankly he was not excited about the possible development of other, privately-owned properties.' Dean already knew this. Talking the situation over with Bennett,

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Dean discussed what kind of personal approach would engage Howe's enthusiasm. The best way, Bennett told him, was to stimulate Howe's interest as a professional engineer in one of the largest engineering projects on earth. A tour and a proper, frank, briefing might turn the trick. At least, the Eldorado president argued, it was worth a try. Back in Ottawa, Bennett broached the idea to Howe. Dean would like him to come down for a tour, he told the minister. That was a good idea, Howe responded. He was particularly interested in inspecting the USAEC'S military production, he told Bennett, though he would also like to see what progress was being made in the peaceful application of atomic energy. After Bennett reported Howe's willingness to Dean, a tour was scheduled to start in Washington on 18 August. Before it took place, Dean and Jesse Johnson, the Raw Materials director, conferred with Bennett and then, just before Howe arrived the whole commission met to discuss what they would show and tell their Canadian guest. Howe did not come alone. Bennett came too, naturally, and so did George Bateman, Eldon Brown, and Charlie Williams from the Eldorado board. Johnson had urged Dean to work out a joint exploration and development program, up to and including the construction of mining plants 'without awaiting full development of ore reserves.' That had been done at Beaverlodge; apparently it could now be tried elsewhere. Next Dean should explore the prospect of injecting 'additional capital' into exploration, mine development, and plant construction. Johnson hoped that Howe 'might suggest that Canada is prepared to take care of this financing. If Canada is unwilling, I would assume that the Commission would agree to finance, by advances or loans those projects which it approved; Possibly a joint program could be worked out, something which in Johnson's opinion was 'most desirable' because it would allow the USAEC 'a greater voice in the program and, at the same time, provide for an adequate contribution by Canada.' Lastly, Johnson hoped that Dean would find an occasion to discuss the prospects for getting Canadian mining companies more actively interested in uranium. He held out no great hope that such a thing was practicable, since as far as he knew, Canada was most unwilling to contemplate either

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government exploration or production loans. But there was always hope. Dean and the commission received Howe and his party in Washington on 18 August. Dean had promised Bennett that he would bend American security restrictions as far as he could and, as Bennett later said, 'he did this to the greatest degree.' The USAEC chairman told the Canadians how much uranium the United States needed, and why. The next day, Dean took the Canadians over the Blue Ridge to Oak Ridge Tennessee to inspect the USAEC'S gaseous diffusion plant. Then it was on to Fernald, Ohio, where a new uranium refinery and metal plant were under construction. Dean then turned the Canadians over to Dr T. Keith Glennan for the last stage of their tour, to Augusta, Georgia, where the USAEC was building a huge reactor and heavy water complex along the Savannah River.As Bennett explained to the USAEC commissioner, the visit had 'accomplished even more than he thought it would.' As an engineer, Howe had liked what he saw; he was intrigued by its complexity, and impressed by its cost. In September, C.D. Howe and Bennett exchanged letters confirming Eldorado's sales policy. Howe approved uranium sales to the United States for the next ten years. As he wrote, T see no reason why [Eldorado] should not sell uranium to the United States provided the price is as good as can be obtained elsewhere.' And that, he knew, was a foregone conclusion.1 I

The price to the Americans would be determined by the cost of production at Beaverlodge.There there were several variables to consider. Would experience show that the mine was properly sited and mining practice well established? Would the mill function well, or adequately, or at all? Would Eldorado be able to produce sufficient uranium to justify its investment? The mine was the first item to consider. The dominating feature of the mine was the St Louis fault, running north-east from Beaverlodge Lake. The fault line was at an angle of 50 degrees, inclining south. At times the fault was little more than a crack in the rock; at times it had more than a foot of mud packed between its

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hanging wall and its footwall. Nestled up against the fault was ore; not all of the ore by any means, but always enough to remind geologists and mining engineers of Beaverlodge's origins in a geological upheaval millions of years ago. The hanging wall is on the south side of the St Louis fault, and from the beginning it presented special problems. 'Enough has been seen of the ore bodies to know that they will have to be mined by cut and fill,' Gillanders reported in 1951. 'This is primarily due to the shattered 50° hanging wall.' On the insistence of Eldon Brown an outside consultant was brought in to advise on the mining plan and he indicated his approval of the Gillanders proposal. Cut and fill means literally that. The ore is cut away, and as the ore is removed the resulting space is filled with sand or tailings. This simplified explanation only begins to describe a complex process. In the first stage, miners drill and blast out ore which is dumped on the floor below. This ore is then cleared (slushed) out into an ore passage leading to an ore crusher located below the seventh level. As the miners work up, wooden timbering is constructed underneath them, and into this timbered structure are poured deslimed tailings. The water eventually seeps out; the tailings stay, becoming hard packed, and furnish a firm foundation for the work now proceeding above. Very little was wasted at the mine. Mill tailings were first sent to a large outdoor machine called a Dorr clone, which separated unusable waste from sand, or deslimed tailings. The deslimed tailings were then recycled back into the mine, to assist in further mining. The residue continued on into a tailings pond located some distance east of the Fay shaft and the mill. The mine was extensive, following the fault all the way from Beaverlodge Lake to Ace Lake.The Ace shaft, which the reader will remember was an inclined shaft at an angle of 50°, was never designed for production. Instead, it did duty hauling men and equipment up and down, using a large compartment with a step system inside on which men and machines perched.The Fay shaft was, of course, the main one. Once it was completed, men and equipment were moved down its lifts and dropped off at the sixth level, 750 feet down (each level was 125 feet below or above its neighbour). At this level a tram line took men across to the Ace ore

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body, using a miniature train with 'man-cars' which in principle if not in comfort resembled streetcars in the world outside. As the mine developed it involved travelling more, because on lower levels the ore was angling away from the plane of the Fay shaft. Thus, as time passed, mining moved south following the angle of the St Louis fault. Time spent travelling is time not spent mining, and thus the location of the production shaft and the distance between it and the ore are important factors in calculating the economics of a mine.2 A third shaft, Verna, was now sunk, after diamond drilling disclosed what the Annual Report called 'a favourable formation and interesting values in the hanging wall of the St. Louis fault.' A haulageway was then run along the sixth level all the way from Ace to Verna, a distance of 6000 feet.3 The shattered hanging wall had to be dealt with because of the danger of rock falls onto the miners working beneath. Rock bolts (steel shafts of up to eight feet long) were driven into the hanging wall and often bolstered with wooden timbers or, later, with steel mesh. In Ace and Fay, geologists, mine captains, and miners had comparatively few problems. Those ore bodies, Ted Smith, a geologist, later explained, 'were straightforward. Both of them had well-defined networks of vein.' To get at the ore a straight tunnel called a line drive was driven on each level about 100 feet parallel to the fault. Holes were then drilled vertically and horizontally to define ore limits. The mining engineers would look at what the geologists had uncovered, and make plans for mining it. In case of dispute, higher authority up to the mine manager could be called in; and dispute was not unknown. 4 The basic mining plan was fixed by Buffam, and to some extent was followed from the beginning until the mine ceased to operate in 1982. Buffam laid down a procedure for exploratory drilling on the surface starting with drill holes 800 feet apart, narrowing to 400, then 200, and finally, if results were at all promising, to 100. Each hole helped to define more and more closely the ore body, if any, underneath. Because of Buffam's authority, geologists may have found the going easier at Beaverlodge than at other mines; when disputes arose it was more likely, though not certain, that they would be resolved in a geologist's favour. But, as Murray Trigg, senior geologist at Beaverlodge in the late 19508, pointed

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out, 'if Buffam had been unable to convince senior management that "grade control" was the essence at Beaverlodge it would have been next to impossible for the geologists alone to convince the mine department.'5 Buffam's mantle did not extend from the mine to the mill. The mine produced between 500 and 700 tons of ore a day and the ore entered the mill from an underground crusher set at 5—6 inches via a conveyor. It was then crushed by two Symons crushers in series and sorted by screens.At this point the ore was no larger than one-half inch in size. This much was standard practice. What followed was much more controversial. The decision to use carbonate leach instead of acid leaching made sense in virtually everyone's eyes. But how best to go about carbonate leaching? Experience at the pilot plant stage suggested using autoclaves (in effect huge pressure cookers) as the crucial stage in leaching. The autoclaves were as expensive as they were large. In certain circumstances they ought to have worked, but those circumstances did not prevail at Beaverlodge. Using pressures of 85 pounds per square inch and functioning at a temperature of 2350F, the autoclaves agitated the pulp, which was mixed with sodium carbonate, for between 16 and 20 hours. 'The trouble with the autoclave carbonate process,' Thunaes later commented, 'is that sulphur in pyrite is completely consumed, forming sodium bicarbonate which is very corrosive.' Under certain circumstances, if the Beaverlodge ore had had uniform sulphur content, or had been very low in sulphur, there would have been no corrosion, and that is what the company's experts expected. 'All the bloody experts who were in the picture,' Bennett reflected, 'none of them ever mentioned the word corrosion.' Bypassing the autoclaves for the moment, let us finish our description of the mill. The solution emerging from the autoclaves was precipitated with caustic soda, then pressed and dried. The result was known as yellowcake, a yellow powder resembling nothing so much as an exotic cake mix. (Yellowcake's chemical description is NO 2 U 2 O 7 ; it is about 70% pure uranium oxide.) Much purer than the gravity concentrates from Port Radium, it was itself a notable advance in Eldorado's technology. The yellowcake was pressed into 45-gallon drums weighing about half a ton

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each, and flown or shipped out. The mere fact that a similar cargo tonnage now contained six or seven times more U3O8 — and was being shipped a much shorter distance - was also a tremendous saving. First reports were rosy. C.S. Parsons, though retired from the Mines Branch, stayed on as senior consultant to the company. After visiting the mill in June 1953, he cheerily told the board that 'the autoclaves have given no trouble.' Despite the risks incurred in short circuiting the pilot-plant process, the mill was actually working 'reasonably well.' The board naturally concluded, as one of its members later put it, that 'everything was wonderful.' 6 The autoclaves were eighteen in number, in two rows of nine. They had been designed to permit numbers of them to be taken out of the circuit for inspection and necessary repairs, and in the fall one of them was opened up for examination.The inside was not merely worn but pitted by corrosion, 'and there was great consternation,' in Thunaes's words. Efforts were naturally made to repair the autoclaves by insulating them, first by welding a nickel alloy, Inconel, and then by coating the sides with an epoxy developed at the Battelle Institute in the United States. These efforts took time, and in fact the autoclaves were not entirely removed from the mill until much later. Thunaes, who had moved over from the Mines Branch to become first head of Eldorado's own research and development unit, had a different idea. In December 1953, he told the board about a device developed in the Mexican silver mines at Pachuca. There the Mexicans had developed what is described as 'an air-agitated, solid-liquid mixing vessel in which the air is injected into the bottom of a centre draft tube; air and solids rise through the tube, with solids exiting the top of the tube and falling through the bulk of the liquid.' These mechanisms, which were very large, were naturally called pachucas, a term which Eldorado's staff had considerable difficulty pronouncing. Unpronounceable or not, they became a fixture of the Beaverlodge mill until it finally closed in 1982. With Roy Henry's support, Thumaes urged that four pachuca tanks be installed to leach at atmospheric pressure (as opposed to the pressure-cooker effect of the autoclaves). It was not merely that the autoclaves entailed some

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risk of continuing failure. Pachucas, Thunaes reported, would be less sensitive to sulphur in the ore, and would also save on materials - possibly as much as $ i to $ i .50 a ton worth of soda ash would be saved. The board, which at this stage was willing to try anything that would solve the problem, agreed, and four pachucas were installed. The capacity of the mill, pachucas plus autoclaves, rose from 500 tons to 700. The later history of the mill was a projection of its first two years, and can be summarized here. The development of the new Verna ore body in the mid-19505 added considerably to the mine's reserves even though the new ore was of a somewhat lower grade. With this addition to the reserves, it became possible to expand the capacity of the mill to 2000 tons per day. Because ore from Verna was high in pyrite, a new flotation unit to handle the separate leaching of pyrite concentrate was installed. Because oxygen worked better than air in the pachucas, Eldorado found itself in the oxygen-plant business, using a second-hand unit. Some of these developments occurred after the end of our period. At the time we are considering here, Beaverlodge was steadily expanding. In 1957, the mill hit 2000 tons a day. In 1959, at the height of the boom, Beaverlodge was producing and treating 686,334 tons of ore to make 2,535,451 pounds of contained U3O8, and the mill was continuing to work at full or nearly full capacity. The pay was good — $1.61 an hour and all the overtime anyone could stand — but earning was gruelling. In a typical intake of 2 7 men in the mid-19505, only one was left after a week. That one endured to become assistant mill superintendent; the rest presumably found their way back to Edmonton, where they had been hired off the streets. 'Any new plant has bugs,' Vince Dolan, a mill veteran, recalled, but the problem wasn't simply technical. 'My feeling at the time was that it was letting a bunch of kids into a pot of jam.'7 Confusion, high turnover, and experimental styles of management were to be expected in an era of high growth and low unemployment. So few Canadians were willing to take jobs in a mine by the mid-1950s that Eldorado dipped into the overseas labour market. It got, in return, a stable and hard-working immigrant labour force, mostly from central and eastern Europe. More stability meant more efficiency and ultimately lower man-

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ning levels as more and more workers got better and better at their jobs. Some of the credit for this development belongs with local management. Dick Barrett, who came in 1953, and stayed just over two years as the first full-time manager at Beaverlodge, had the task of working out kinks in the operation. There were so many facets to the job, he discovered, that the effort was exhausting, particularly when labour negotiations were piled on top. Barrett yearned for a quieter life and found it when in 1955 Bennett offered him the chance to move to Ottawa to handle the company's new ore procurement division, the fruit of the ultimate success of Eldorado's incentives to private production. To succeed Barrett, Bennett appointed Bill Gilchrist, who had come as assistant manager in January 1953. Gilchrist proved to be a competent mining engineer; equally important, he stimulated loyalty among staff and miners, who appreciated his knack of remembering their names and background, and his habit of inquiring after their circumstances. The improvements in Eldorado's labour relations, and the fond memories that old-time employees have of that period are due in no small measure to Gilchrist's personal skills, and to those of his successor, Hal Lake, who moved down to Beaverlodge in 1957 from Port Radium.8 What Eldorado learned from Beaverlodge it was prepared to pass along. The first in a new generation of uranium mines, Beaverlodge had an importance that went beyond its own production record or its contribution to the Eldorado company. But the first contribution it made was price. II

The economic basis of Beaverlodge was the same as for all other aspects of Eldorado's operations in the years since 1942. The cost of exploration, it will be recalled, was included in the cost of Port Radium ore to the USAEC in the late 19405.The risk that Beaverlodge might prove hasty or ill considered was weighed against the Americans' willingness to assume the cost of the risk. The cost of speed, which Henry deplored in a report on Beaverlodge in 1953,

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was nevertheless not ultimately chargeable to the company, but to the Americans who had wanted it, and who had been prepared to pay for it. The terms Bennett settled on were outlined to the Eldorado executive committee on 25 August 1953, that is five months after production began. Bennett told the committee that 'tentative agreement' had been reached on five principles: a There would be a five-year contract, to run from 1953 to 1958. b The first year's price would be based on an educated guess of the first year's production costs, c The cost would include the amortization of all Eldorado's expenditures in the Beaverlodge area since 1948. d Eldorado was guaranteed 'a fair and reasonable rate of profit.' These words in fact masked real disagreement in principle, since Bennett admitted that there was no accord on 'whether the profit would be based on operating costs or on a fixed rate of return on the capital invested.' e After a year the price would be re-computed to take into account the actual costs experienced during the first year.9

As always Bennett and his directors were firm in their position that the contract should be for a fixed price and that this should provide for a fair and reasonable profit. After what Bennett called 'a lot of strenuous negotiations' with Johnson, a contract price of $9 per pound was agreed. Under the contract, 5,000,000 pounds were to be delivered by the end of June 1958; this amount was later increased to 8,000,000 pounds. In 1955, when it was decided to bring the mine production up to 2000 tons per day and to expand the mill capacity to handle that tonnage, the amount of the contract was increased to 16,800,000 pounds with deliveries to be completed by 31 March 1962.10 While the price of $9 turned out to be lower than the price paid to other producers under the purchasing formula which we will describe later, in Bennett's view it was an equitable arrangement. After all, the USAEC had agreed to underwrite several risks which we have described. All in all, as Bill James later put it, 'we made a good profit on this' - a good enough profit for the terms to be attractive to others as

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well. For by the time the final Beaverlodge contract was firmed up, in 1955, Eldorado was finally no longer alone in the Canadian uranium game.11 The transformation was in the first place a matter of geological knowledge. What had been a vague certainty that there must be uranium out there, somewhere, to be uncovered somehow and made profitable, changed in the space of three years. Northern Saskatchewan finally lived up to the hopes of the Eldorado geologists; enough traces of uranium were identified to justify a mine near Great Slave Lake; the old Bancroft fields in Ontario were expanded to the point of economic mining; and, best of all, a huge uranium deposit was staked in the Blind River area of Ontario. The succession of public price offers made by the governments of Canada and the United States in the years after 1948 was intended to spread risk and mobilize resources. To some extent it succeeded, but it was not enough to satisfy even speculators and large established mining companies that they could reasonably hope for an adequate return on an expensive initial investment. Through the early 19505, speculators succeeded one another in poking around the fringes of Eldorado's Beaverlodge property. The first one to prove an interesting quantity of ore was just on the limit of Beaverlodge: Radiore, on the south side of the St Louis fault. Its ore body was to all intents and purposes an extension of Beaverlodge, and it was a simple matter for Eldorado and a profitable one for Radiore to agree that the crown company would mine the whole deposit in return for an annual guaranteed royalty of $50,000, with more at the end of the year if results justified it. For Radiore's owners, the Byrne family, it was the best kind of mine: little risk, few expenses, and no labour force, apart from bookkeepers, to keep up.12 The next property to be developed, Rix-Athabasca Uranium Mines Limited, lay west of Beaverlodge, near Bushell on Black Bay. Rix-Athabasca was the work of enterprising prospectors, who marketed their discoveries in Toronto. There they encountered Joseph H. Hirshhorn, an American mining promoter who for many years had established a base of operations in Toronto. Hirshhorn took their concessions and in return gave them money

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and stock in the future company. The company took longer than Hirshhorn calculated to float, and en route the New York State attorney-general insisted on holding a highly public and embarrassing investigation of its affairs. But finally, under the name of Rix-Athabasca, it got its mine, hauled its ore, and delivered 100 tons a day to Eldorado's Beaverlodge mill for processing. Since the ore then passed from Rix-Athabasca's control, it never appeared as a separate item of discussion between Eldorado and the USAEC. Rix-Athabasca never produced more than a small drop in the Canadian ore bucket. Its greatest importance, retrospectively, was that it brought together Hirshhorn's promotional talents with the geological skills of a British Columbia geologist, Franc Joubin. The two men would soon astonish the mining community with a notable coup, thousands of miles away to the south-east, a discovery which would make — or in Hirshhorn's case increase — their collective fortune. Diagonally across Black Bay, Saskatchewan had granted another mining concession, labelled GG. GG was the concern of Gilbert LaBine, who had returned to the uranium fields determined to make his second fortune. His interest in GG had led to the final severance of ties between LaBine and Eldorado, since he could not remain as a director of a company with which he might eventually be negotiating a contract. There had been a brief period when he did both, by taking an interest in a set of claims near Eldorado's Eagle shaft; these claims were developed as the Nesbitt-LaBine mine, and LaBine appointed as manager none other than Emil Walli, the former Port Radium manager. Nesbitt-LaBine was a small mine, and LaBinejudged it disappointing: 'the operation was not financially successful,' according to a 1959 commentator. But Nesbitt-LaBine brought Gilbert LaBine to Beaverlodge.13 In 1952 LaBine assigned a veteran prospector, Albert Zeemel, to the GG concession at the south end of the Crackingstone Peninsula, a hilly promontory jutting into Lake Athabasca. Zeemel's reports brought LaBine to the property in a hurry.14 For the second time in his life, LaBine's luck and his prospecting instinct had led him straight to a large, profitable uranium deposit. As he had had with Eldorado, the old promoter had a defunct gold mine, Gunnar, ready to assume title to the discovery. The parallel

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went even further, since one Eldorado director, Fraser Reid, sat on the Gunnar board while another, John MacAulay, had only recently resigned. Dropping 'Gold' from Gunnar's name, LaBine set to work to develop funds to disinter his new bonanza. (Naturally, LaBine called it an 'elephant.') Unlike either Port Radium or Beaverlodge, most of Gunnar's ore lay close enough to the surface to be mined in an open pit - a much cheaper method of operations than the costly underground workings Eldorado was completing at Beaverlodge. Gunnar's share capital ballooned from $3 million to $5 million, while excited press reports reminiscent of the 19305 helped set the mood. 'Uranium Project Suggests Big Tonnage,' the Northern Miner told its readers in February 1953. In April, the Miner learned that 'Gunnar Results Big, Important.' A week later, 'Gunnar Drilling Extends Ore,' and at the end of the month, 'Gunnar Ore Body Spreads West.'15 Gunnar's publicity boom was catching. Rix-Athabasca stocks soared along with the clouds of press-agentry. 'All over the area,' the Northern Miner reported, 'work camps are being set up and work gangs settled on the outlying properties so that exploration can proceed during the break-up period.' When, in April, Eldorado held the official opening of Beaverlodge, it was congratulated on 'a Major Prize' and for 'money well spent.' In May, 'large sums of money went into the treasuries of companies located near the Gunnar properties.' Taking the long view, the Northern Miner observed that during the winter and spring of 1953, uranium stocks had led all the rest in popularity. 16 The money raised was soon spent. It was estimated that $6 million had been spent in diamond drilling alone around Lake Athabasca in the summer of 1953. The local storekeeper at Uranium City accumulated claims just by sitting in his tent store and accepting them in lieu of cash. Early in 1953, he sold 200 claims for just over $210,000. He promptly chartered a plane to fly himself and his family to London to see the coronation of Queen Elizabeth n.17 Most of the mines in the Athabasca country would always be small operations. The first ones developed a kind of satellite relationship to Beaverlodge, on which they relied for the custom refining of their ore. Later mines were encouraged to co-operate to build a common mill, and for a while such a mill managed to

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operate. But Gunnar was a very different proposition. It was a saucer-like ore body which could be mined without going underground. It was geographically isolated, 25 miles from Uranium City and far enough out not to be able to rely on Uranium City for its ordinary services. The size of its ore body and the remoteness of its location justified Gunnar in planning its own mill, for which Al Ross, late of the Port Hope refinery, was the consultant. The presence of LaBine, Walli, Ross, and several other ex-Eldorado men in the several LaBine companies suggests that their feelings towards the older company may not have been entirely free of rivalry, as a story in Maclean's hinted. Told that Eldorado officials had described Gunnar as 'a geological freak,' LaBine snapped back that 'all great mines are freaks.' He was, as Maclean's observed, 'not averse to twisting the harpoon.'18 LaBine's elephant was a baby compared to the mammoth that was about to appear in Ontario. 'Uranium Again for Ontario,' the Northern Miner proclaimed in June. On the north shore of Lake Huron, between Sault Ste Marie and Sudbury, a new rush was under way. That uranium existed there was, in a sense, not news. Claims were staked as early as 1949, but they were inconclusive at best; at worst they were actively discouraging.The results intrigued Franc Joubin. The fact that surface showings were disappointing, he came to reason, was not enough. South African experience showed that uranium near the surface could have leached away; only drill holes would furnish conclusive evidence as to whether there was economic uranium or not. Joubin through his connection with Hirshhorn, could find money enough for drilling; as drilling proceeded, the cores were airlifted to Frank Forward, for testing.An anxious wait followed, and then good news. Fifty out of 56 specimens showed an average grade of 0.11% uranium, and that was enough to sell a mine. Staking proceeded through April and May, culminating in a blitz at the end of May. When the smoke cleared, Hirshhorn and his associates had staked over 1500 claims. The resulting mines were labelled 'Pronto' (south end), Algom Nordic (middle), and Algom Quirke (north) - Algoma being the name of the district in which the mines were situated and, incidentally, the parliamentary constituency of Lester B. Pearson, Canada's minister of External Affairs.

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In the end there were eleven producing companies in Algoma. Of those, seven were controlled by Hirshhorn and Joubin or their eventual corporate descendant, Rio Tinto. But one of the richest mines got away. That mine, Consolidated Denison, appeared late in the day, because of the efforts of a Slovakian immigrant, Stephen Roman.Those efforts would ultimately be worth hundreds of millions of dollars. Two other uranium occurrences are worth noting here. Between Peterborough and Ottawa, north of Ontario's Highway 7, was the site of Canada's original uranium deposits at Wilberforce. The small town of Bancroft, nearby, became the focus of a new rush, which spawned three more mines, Bicroft, Canadian Dyno, and Faraday. They were small by comparison with those at Beaverlodge or Algoma, but they turned a steady profit, not least because of all Canada's uranium zones, Bancroft was the closest by road and rail to Canada's industrial heartland.19 By the end of 1957, there were seventeen uranium companies in Canada. Of the seventeen, only Eldorado was authorized to deal in uranium; all the others sold their product, milled or not, to the crown company, which then, in parallel contracts, sold the uranium to the USAEC. It would be Eldorado that advised on those contracts, and Eldorado which would help set their terms. By the end of 1957 those terms would be worth a cool $1.425 billion. Until 1953, Eldorado had not had to worry very much about the attitude of the Canadian mining industry. The crown company was doing a job for defence, which commanded almost universal support in Canada's political community. It was doing a difficult and expensive research project, and its pioneering efforts in milling were regarded with awe, but not envy. In any case, as Bennett told the Prospectors and Developers' annual meeting in 1951, Eldorado had been a 'guinea pig' for the rest of the industry, which could expect to share not only its experience but, if they asked, its people as well.20 Gilbert LaBine, ironically, would be the first private producer in the field. His Gunnar mine would most likely come into production in 1955 and he regarded it as a rival to Eldorado. As Bennett wrote in July 1953, 'Our relations ... are not entirely cordial.' Eldorado's ex-president and founder regarded his former company as a kind of

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government pet with a 'preferred' position, and he lost no opportunity of voicing his suspicions on the subject. LaBine had left Eldorado before any serious consideration had to be given to the terms to be offered private producers, so he had no undue advantage from that direction in carving out a negotiating position for his company. He did, however, have an advantage of quite a different kind. Some American companies were already in business selling uranium to the USAEC. LaBine needed cash and he may have needed experience. He turned for both to an American mining company, Climax Molybdenum. This fact came to Bennett's attention in an unusual way. On 30 June 1953, Bennett was preparing for a meeting of the Atomic Energy Control Board. Unexpectedly a figure from the past appeared. Carroll Wilson, the former general manager of the USAEC, wished to see him. Bennett could hardly refuse, and what he learned in the next few minutes proved intensely interesting. Wilson now represented Climax Molybdenum which, as Bennett knew, had extensive interests in uranium mining in the United States. Climax had been negotiating for the past three weeks with Gilbert LaBine and Wilson believed that matters had gone far enough to involve Bennett — and Eldorado. Climax's tentative agreement with LaBine stipulated that the American company would lend Gunnar as much as it needed to develop its Athabasca property. In return, Climax would receive 20% of Gunnar's equity and a management contract for the mine. Naturally Climax wanted a good return on its investment, and its directors had to bear in mind that profits remitted from Canada would be subject to American tax, though free of tax in Canada. Climax therefore had certain expectations of the return that it wished to receive from Gunnar, and Wilson had come to explain to Bennett how those expectations might be realized. There were three ways, to Wilson's mind. First, Climax should be allowed to enter into negotiations with the USAEC for the sale of Gunnar's product. Should that prove unappealing, there was a second way, namely joint negotiations, Climax and Eldorado on one side of the table and the USAEC on the other. Finally, if that proved unfeasible, Climax should simply get the same price for

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Gunnar ore as it was already receiving for its existing mines in the United States. Bennett found Wilson's proposition peculiar, not to say offensive. He took Bateman aside after the AECB meeting and discussed the matter with him, and then phoned Jesse Johnson in Washington to tell him what was afoot. All three men took a dim view of Wilson's activities and Climax's proposals. The AECB also turned up its collective nose. Climax's proposals, it concluded, were contrary to established policy and should be firmly rejected. There were broadly two reasons for rejecting them. First, it was not in the Canadian national interest to allow control of uranium policy to slip from the hands of the government or its agencies. Climax could not be allowed to set up an independent little kingdom of its own just because Wilson, as its representative, knew from his own past government service what the competitive situation vis-a-vis the United States actually was. Second, and equally important, Climax was asking for a very large profit indeed. Its profit taking would be so large that it would violate the tacit convention on profits that existed between Eldorado and the USAEC. The reason that it wanted large profits was to secure a quick return on its capital, and because of its unusual tax position by comparison with purely Canadian mining companies, which were not taxed during their first three and a half years of operation. Bennett urged Howe not to agree to anything that Wilson, Climax, or LaBine might propose. Gunnar was, by comparison with Beaverlodge, a very cheap mine to operate. A glance at the economics of open-pit mining proved that. In July 1953, as Bennett was writing, there was still no certainty that Eldorado's ore reserves at Beaverlodge would prove sufficient to support a aooo-ton a day operation, whereas the nature of the Gunnar ore body made it possible to estimate with reasonable accuracy the total tonnage available. Pre-production costs were much higher in Eldorado's case than in Gunnar's because of the need to provide facilities for underground mining. Under the circumstances, there was no chance of pleading with the USAEC that Gunnar's costs justified a higher price of the kind that Wilson and Climax were demanding.21 The deal, not surprisingly, was aborted. Climax suspected that

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LaBine was playing the field in negotiating with it, and in any case it was obvious by the end of the summer of 1953 that the American mining giant would not get the terms it wanted. It vanished from the scene, leaving Gilbert LaBine to make the best terms he could with Eldorado. To assist, Bennett authorized tours of Beaverlodge for LaBine and Ross, reminding Barrett that LaBine was likely to be particularly sensitive to any hint that Eldorado was not cooperating as fully as it might. Roy Henry, as vice-president in charge of operations, was given carte blanche to discuss Eldorado's costs with LaBine or his representatives. One thing that was obvious to both companies was that despite his low mining costs, LaBine would still face very considerable expenses for what Bennett termed 'the installation of large chemical processing plants, with high capital and operating costs.' Gunnar's peculiar circumstances made it possible to believe that it could absorb these costs with some minor adjustments to the public price schedule; but it was certain that other companies could not.22 Adjustments to the public price schedule automatically involved consultations with the Americans, whose money, ultimately, was at stake. The topic was explored in discussions in Montreal between Bateman, Bennett, and Jesse Johnson at the time of the Climax offer in June 1953. It was explored again in September and October 1953, at which point Johnson seems to have suggested that the USAEC'S experience with South African producers offered a guide to dealing with Gunnar.23 These terms were conveyed to LaBine in a letter of intent on 29 October 1953, and were confirmed in a contract signed on 11 March 1954. Gunnar was to supply 8,100,000 pounds of U3O8 between 1955 and 1960, at $9.50 per pound, for a total of $76,950,000. All sales were to be made to Eldorado, which then signed an identical contract with the USAEC. Security restrictions still in force kept the tonnages contracted secret, but the sums involved were not. This arrangement greatly facilitated Gunnar's financing, and indeed the company promptly announced 'Financing no Obstacle,' according to the Northern Miner. So favourable was Gunnar's position that it was able to resort to the unusual tactic of selling debentures totalling $ 19.5 million in the summer of 1954. The largest single purchaser, the press reported, was an insurance

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company, sure evidence of the high reputation Gunnar had achieved.24 The reader will recall that in the price formula first announced by Howe in March 1948, there was a provision that 'under special circumstances' a higher price might be paid than that provided in the formula. The Gunnar contract was the first contract negotiated under the 'special circumstances' provision and the factors used in establishing the price of $9.42 per pound were to be the basis for the 'special price' formula which was established subsequently for all other producers. The discoveries of the summer of 1953 ensured that there would soon be more applicants for positions at the uranium trough, and Eldorado had soon to face up to the problem of dealing with them. Roy Henry first raised the issue in a memorandum to Bennett two days after the letter of intent was sent to LaBine, on 31 October 1953. Henry had been asking himself why investment in uranium promotions had come so late, and proved so shaky. The answer lay in the circumstances of the mining industry. Exploration and development were always costly. Raising money for development and pre-production expenses was an uncertain business made palatable only by firm predictions about market prospects. In the case of uranium, however, the selling price was determined in negotiations far down the road. Naturally investors did not find the prospect of future and uncertain negotiations an enticing foundation on which to build a mine. It would help if they could refer to a formula that would tell them in a simple and understandable way what to expect. That was the theory behind the public price formula, of course, but since it was universally understood that the public price was obsolete, it surely made sense to develop a new, and more realistic, pricing policy. Gunnar, in Henry's opinion, pointed the way. In arriving at the $9.50 per pound price for Gunnar, negotiators had agreed on a base price of $4.00 per pound of U3O8 content in ore ($2.75 plus $1.25 development allowance). Then they allowed for estimated operating cost, a five-year amortization for mining and milling plant, and a profit of 25% on estimated operating cost. That had produced $9.50. Henry suggested boosting the base rate of $4.00 to $4.75, which he considered economically more realistic.25

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Bennett and Johnson mulled Henry's proposal over in meetings in Washington in November. Johnson found Henry's idea simultaneously attractive and repellant. It was attractive because it was so obviously realistic; but it did not take into account the consequences of publicity. A new Canadian published price, backed up by the USAEC, would raise havoc in the latter's relations with its own domestic producers. Yet the USAEC desperately wanted more Canadian production, and was alive to the financing problems that Canadian uranium companies were encountering. To Bennett, the solution lay in making the same offer to all comers; that would avert multiple commercial headaches later on. He conceded, however, that confidentiality might be the key to the problem.26 Speed might also be a factor. Toronto newspapers were speculating on the possibility of a change of the public price formula, and Bennett was questioned by reporters when he returned from Washington. Naturally the Eldorado president denied that he and Johnson had talked about any such thing, but he was unsure how long he could maintain that bluff. Several contracts were in his in-basket, including those from Rix-Athabasca and Pronto, and Bennett would be greatly comforted if they could be dealt with on a basis of equality. The Toronto newspapers had already scented just how that might be achieved, and were drawing parallels between Canadian and South African experiences. Since that was, in fact, the basis for the Gunnar contract and therefore a close relative of Henry's proposal, the press was getting dangerously warm. George Bateman now weighed in. Writing to Howe in November, Bateman argued in almost the same terms as the Northern Miner. It seemed that there would soon be plenty of commercially viable ore in Canada, he told the minister, and if this were so 'there should be little difficulty in negotiating five-year contracts with the u.s. at prices which would include provision for the amortization of all capital expenditures within the contract period and also allow a reasonable profit.' The result would be a healthy, debt-free, and up-to-date uranium industry which, he hardly needed to point out, was intensely desirable.27 Johnson, meanwhile, was taking the hint. Tt would appear,' he wrote to Bennett on 10 December, 'that procurement contracts should be based upon an estimate of the cost of the marketable

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product, taking into consideration the combined mining and milling costs.' Johnson proposed to offer $5 per pound for contained U3O8 plus 70% of estimated mining and milling costs, including amortization. Using figures available through Eldorado, the USAEC calculated that this formula would render a Gunnar price of $9.42 per pound, slightly less than had been contracted for. This was not to be taken as reopening the Gunnar negotiation: that was over and done with and there must be no basis for complaint by LaBine. As for quantity, Johnson wrote, 'It is my opinion that the Commission would favourably consider underwriting any procurement contracts involving a price of $12.00 a pound or less.' It might even go higher, though in such cases the formula would still have to apply.28 Henry was favourably impressed. It was true that Canadian mining companies were used to a different mode of calculation, but the unfamiliarity would soon pass. However, it was also true that reliance on estimated costs might open Eldorado to abuse by an unscrupulous mine owner who would 'twist his estimates to obtain a more favourable price.' Indeed, dependence on estimates introduced an incalculable variable in determining an equitable price before actual operating experience showed what costs would be.29 After meeting with Bateman and Henry in Montreal on 29 December, Bennett wrote to Johnson agreeing with his proposal. The proposition had the advantage that it would not require any renegotiation with Gunnar. And, as Bennett explained to Eldon Brown in January 1954, Johnson had at last agreed to 'a common formula.' Henry's misgivings carried weight, Bennett admitted, but with due care and prudence it should be possible to arrive at 'fairly accurate figures.' As a concession to Johnson, however, the new formula would be kept confidential.30 Howe naturally approved. He and Bennett both understood that the formula's confidentiality was a matter of form, since it would obviously reach anyone who needed to use it. Howe did not need to be reminded of the stimulus that such a formula would offer to the uranium industry: it was already sufficiently active without 'the further incentive that would be given by publicity for this formula.' Howe knew very well that not only mines, but towns and roads would be springing up in the aftermath of expansion; he hoped

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that they would not soon be un-built, and abandoned in the wake of a short-term speculation.31 Spectacular results of the new dispensation were predicted. The actual tonnage of uranium produced in Canada in 1952 was 210 tons, worth $6.7 million; and in 1953, 225 tons, worth $8.2 million. In October 1953, Roy Henry worked out an estimate of reserves and annual production by the six most likely mines in Ontario and Saskatchewan. By 1955, Henry estimated, Canada would be delivering 950 tons of uranium oxide to the Americans. This figure would rise to almost 4500 tons in 1958, peak for a couple of years, and then dwindle to 900 tons in 1962, the last year in which the USAEC guaranteed purchase. Reasonably assured production between 1955 and 1962 would be 24,090 tons, but that figure increased to 33,000 tons if probable and marginal production were added. The least that uranium would be worth to Canada, if Henry were right, was $500 million; using the higher figures, uranium's value over a seven-year period soared to $715 million.32 Henry's figures were soon revised, revised again, and then rewritten. By the end of 1957, four years later, contracts covering 70,000 tons worth almost $1.5 billion had been written. These figures even then were approximate, but the magnitude of the deals was not unimpressive. By then Eldorado's own annual gross revenue was touching $40 million, a significant figure, but one that paled beside the billion-dollar exports that the company, wearing its governmental hat, was compelled to supervise.33 It was this miniature empire that Dick Barrett was called back to supervise in 1955. Henry by then had other duties and other worries, and Bennett himself had to divide his time between Eldorado and Atomic Energy of Canada Limited, of which he had become president in 1953. The board was not directly involved, since except for bookkeeping and financial charges and the salaries of Barrett and his staff, the contracts between the USAEC and Eldorado and between Eldorado and the private producers did not bear on Eldorado's performance as a mining company. After a certain point, however, Bennett decided that it might be a good idea to keep the board generally informed about the state of affairs between Eldorado and its private competitors. Ray Birks, still on the board after fifteen years, had remained a friend of LaBine's.

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He reported that LaBine believed, and was saying, that Gunnar had got a raw deal from the late development of the formula. Stimulated by Birks's report, Bennett told the board what he thought of LaBine's arithmetic. Gunnar was lucky to have preceded the formula. The company would get a lower price, not a higher, if the formula were applied. And from that point the directors got, informally, a run-down of the activities of Barrett and his ore procurement division. What did Barrett's job consist of? He had, first of all, to apply his existing experience to assessing the promoters, engineers, and speculators who paraded through his office. He, along with other Eldorado executives, had to know, or be able to find out, whether so-and-so's reputation was spotless, whether engineer x had a history of reckless cost overruns, and whether promoter Y had the connections that would allow for reliable finance. Next, he had to investigate and if possible determine whether a given mine actually had the U3O8 that it claimed to. Were its pre-production costs accurately estimated? Were its capital costs well conceived? Finally, were its estimated production costs in the ballpark? These were the elements that went into the formula, and it is as well to pause at this point and scrutinize what the formula was. It started with the total cost of setting up a mine and mill complex, as well as the estimated cost of production. All this was added up and multiplied by 70% on a per pound basis. To the resulting figure was added $5. More simply, you took the cost per ton, and divided it by the number of pounds of oxide estimated to be contained within it. Multiply the result by 0.7. Then add $5. The result is what your company can expect under the formula. As Barrett later wrote, Tn theory this was all very beautiful, but most mining engineers would say that it was very impractical — so much so that one of the large well established Canadian companies got into the program.' For them, a mine that would last five or seven years - the maximum they could expect if, like Gunnar, they started producing in 1955 - had too short a life expectancy. Tt complicates your life only for the short term,' Barrett explained. 'They talked to us, but they walked away.' So Barrett dealt with what he found - mostly new companies. His initial inspection and assessment was in many ways the most

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important. On it depended whether he felt able to give encouragement or discouragement to an applicant. It was, he added, 'mostly on judgment' that he worked, with the assistance of Roy Henry, Bert Powell ('Bert was excellent because he thought as an accountant'), and Guy Jarvis, the AECB secretary who doubled as Eldorado's lawyer. At this stage, or just after, the Americans would be notified. 'In fact,' Barrett remembered, 'my opposite number, Mr. Thomas L. Wells, and I made many field trips together, at very frequent intervals, and all my collected data was submitted to him so that he and his staff could vet them as we went along.' Given the cordial atmosphere reigning between the USAEC'S Raw Materials Division and Eldorado, this was to be expected. Both the American agency and the Canadian found that they had much in common. 'We wanted a fair deal for our mines,' Barrett said, 'but we didn't want the Americans to be rooked.' As the project advanced, more people became involved. Consulting engineers and geologists sent in reports along with ore samples. These were sent along to Eldorado's R&D division (as Thunaes's team had become in 1953), 'and they, together with the Canadian Government's Mines Branch Lab, did tests to determine the reagent consumption and percentage of recovery to be expected, in the milling of that particular ore.' This information, and more besides, was then fed back to the applicant.34 This picture, as Barrett described it, was ideal. It presumed that the applicant wanted advice and felt able to profit by it. Some did not, 'and then later pressed very hard for a contract which we would not give. In our position, particularly as a Government Agency, we could not be cavalier nor dogmatic — especially as we realized that our judgment was not necessarily perfect, but these die-hards did take up a great deal of our time, and to some extent they tried to bring politics into this matter. Fortunately I can say that such tactics did not affect the outcome in these cases.'35 The results, admittedly, were not perfect. But with a limited staff supervising a mining explosion without precedent in Canadian history, Barrett succeeded in keeping the lid on. Contracts were written, investment made, and production started. From virtually nothing, Canada had built a uranium industry. It had done a number of other things, too. By calling into being a uranium

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industry financed by private enterprise, Eldorado and the USAEC had created a mining group with an obvious interest in perpetuating their industry. What had been a defence industry owned and managed by government now became diffused and to some extent free of government control. But not entirely free, as we shall see, and certainly not independent. From being a political instrument, the uranium industry was becoming a political actor. Ill

Beaverlodge and the uranium boom were only two of Eldorado's concerns in the mid-1950s. Vying with Beaverlodge in cost, and with the Americans in productivity, was the refinery at Port Hope. The refinery had its ups and downs. Its radium circuit was finall discontinued. Its space was becoming more and more cramped, and its equipment was getting older. In the late 19405, the refinery was still doing essentially what Pochon had programmed it to do fifteen years before, and the result was a uranium black oxide of a purity that required further refining in the u.s. With the completion of the new refining and metal complex at Fernald, Ohio, not unnaturally the USAEC began to look at the economics of its refining arrangement with Eldorado. Under these arrangements, Eldorado was paid a fixed fee but, as noted previously, the product did not meet the required specifications for metal production and this necessitated further refining and further costs in the u.s. At a meeting in Washington on 19 June 1951 attended by two of the members of the commission, Bennett was asked whether Eldorado would be prepared to restrict its product to a black oxide of between 30% and 35% purity. Figures were furnished to Bennett in support of the proposal and these indicated a considerable saving to the USAEC in refining costs. As early as 1949, Ross had advised the board of a new refining process called 'solvent extraction,' which would produce an oxide of the purity required for metal production. The British had done some work in this field and their results had been made available to Ross. At a board meeting on 5 May 1950, Ross made a further report on solvent extraction and the board approved his recommendation that a pilot plant be established at the refinery to

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undertake large-scale tests of the process. By March 1951, Bennett was able to inform the board that work on the solvent extraction process had demonstrated its feasibility. He recommended and the board approved the engagement of an engineering consultant who would prepare preliminary plans for the design and engineering of a refinery using the new process. At subsequent meetings of the board and the executive committee in 1951, Bennett reported on the work carried out by the consultant. In some respects, this had been satisfactory but not so in the most important respect, namely the design and engineering of the process. While the consultant was experienced in the design and engineering of ore-dressing processes, his expertise did not extend to the design and engineering of a highly sophisticated refining process. In Ross's judgment, in which Bennett and the executive committee concurred, such expertise did not exist in Canada. In other words, when the USAEC proposal regarding refining arrangements was made to Bennett in June 1951, Eldorado had already expended considerable effort and money in developing a new refining process. In its pilot-plant operation it had established clearly the feasibility of the solvent extraction process, but design and engineering was another matter. Following the meeting in Washington, Bennett called a meeting of the executive committee to which he also invited George Bateman. The meeting was held at Bill James's farm near Milton. Bennett advised the committee of the discussions that had taken place in Washington and pointed out that agreement with the proposal would, in effect, mean that in due course Eldorado would no longer be in the refining business. The committee was unanimous in its decision that Eldorado should continue to refine and that every effort should be made to improve the refining process to the point where an oxide acceptable to the USAEC could be produced. The immediate question, therefore, was one not of principle but of tactics. The status quo was obviously untenable, involving as it did a higher cost to the USAEC. Should Eldorado insist on this, it might well prejudice the company's generally good relations with the USAEC. It appeared to the committee that the obvious course would be to seek an arrangement with the Americans whereby Eldorado would obtain access to design and engineering

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data on the solvent extraction process installed in the Fernald plant. To this end, it was agreed that Bennett should seek an early meeting with the chairman of the USAEC for the purpose of arranging a full and free exchange of information between Eldorado and the USAEC with respect to all aspects of refining, including the production of uranium metal. In support of the proposal, two points would be stressed. First, it was a matter of national policy that minerals produced in Canada should be processed to the highest possible degree. Second, since Canada, through its agent Eldorado, had given the USAEC an undertaking that it would do everything possible to expand the production of uranium and that such uranium would be sold to the USAEC, it followed that this undertaking could best be fulfilled if there was a full exchange of information in all aspects of uranium mining and processing. The executive committee's deliberations were drawn to Howe's attention, asking him to 'define the ultimate objectives of the national policy.' Bennett, who drew up the committee minutes, later reflected 'Why I added [that] I cannot say.' But add it he did, and later he would make the same point.36 Howe had been, on the whole, a passive rather than an active minister as far as Eldorado was concerned. He had never visited any of its facilities, never inspected Port Hope, never gone underground at Beaverlodge. When required, he mustered support for Eldorado's enterprises, and on occasion he could be relied upon for cautionary political direction.This was not, however, one of those occasions. Paradoxically, though, there was a genuine political problem. In June 1951, Bennett had put it to the USAEC that it was established Canadian policy to refine raw materials inside Canada. 'There is,' he was to write in 1957, 'an understandable desire in this country to process raw materials which are produced here for export, where this can be done competitively.' The desire was even embodied in legislation: Section 102 of the Ontario Mining Act, passed during World War i, stipulated that ores and minerals mined in Ontario must be 'treated and refined' in Canada, failing which a mining claim could be forfeited. It was at this point that Eldorado's good relations with the USAEC came in handy, perhaps within the much larger context of

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Canada's generally good and co-operative relations with the United States at this time. Bennett had told Dean in advance what he intended to say, and Jesse Johnson had helped in explaining what was involved. Dean was inclined to be reasonable, not to say friendly, and when he summarized the USAEC'S reaction to Bennett's presentation he did so in terms calculated to make an impact on his congressional watchdogs. The USAEC, he said, 'wanted to obtain as much uranium as possible in the shortest time.' To get it, it would furnish 'every possible assistance, including financial grants and aid in procuring machinery and equipment.' As for technical data, it was up to the USAEC to discover a means of providing it. In the meantime Eldorado should go ahead and plan for its refinery with the understanding that it would produce 'U3O8 of sufficient purity to be used in the metal chain of operation without further refining.'37 To give the Canadians the information they wanted, Dean had to ask Congress to amend the u.s. Atomic Energy Act. It was an indication of the USAEC chairman's considerable political skills that he got exactly what he wanted, and in less than two months. Dean explained to the Congressional Joint Committee on Atomic Energy that Canada was a reliable, if small, supplier that had every prospect of getting bigger. Moreover, he told the congressmen, 'Canada does not find any legitimate reason why it should not produce a high purity product in her own plant, and the commission agrees with the logic of the Canadian reasoning.' The United States could of course choose to be unco-operative, but it would do so to its own cost, since it was altogether probable that Canada would go ahead with its refinery improvements using what the Americans considered to be inferior British techniques.To the joint committee, Dean added that Eldorado was a reputable company owned by the Canadian government and officered by 'men of considerable distinction in the mining field.' It had 'large resources.' In the near future its production was going to expand, and by 1954 and 1955, he predicted 'we should think of Canada and the Congo ... as running neck to neck.' Although the congressmen had some misgivings over security (another British spy scandal had just occurred), they regarded Canada as the best possible venue for a co-operative gesture. So did

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Dean, who was in fact using Canada to prise open the legislative door to a more open American stance. The USAEC'S official history commented that at this point progress 'seemed agonizingly slow. The Canadians had all but lost hope.' In fact, progress seemed amazingly speedy, as Bennett acknowledged in a letter of appreciation sent to Dean on 20 October. On 30 October, Dean's amendment became law, and the USAEC officially licensed to share refining data with Eldorado.38 The information would come through the Fernald contractor, the Catalytic Construction Company of Philadelphia. Jack Burger, who would have much of the responsibility in any new refinery, began commuting there, while Catalytic established a Canadian branch with offices in Port Hope. Their mandate was to make recommendations on the design, engineering, and cost of a new refinery. The preliminary estimate indicated a cost of $7.5 million for a new plant at a new location. At the time the estimate was submitted, Eldorado's financial position had altered for the worse. The Port Radium fire very seriously affected Eldorado's revenues through the year 1952, at a time when the company was faced with major expenditures at Beaverlodge. Beaverlodge was already under way, and Port Hope was not. Beaverlodge represented an imminent hope of revenue, in 1953 at the latest; Port Hope would take much longer. Accordingly, Beaverlodge had to take precedence. Possibly the financial problem could have been surmounted but there was a further problem which suggested strongly that the new refining project should be postponed. Beaverlodge was not yet in production. Consequently, there was no refining experience with the Beaverlodge mill product. It therefore seemed advisable to postpone the final decision on the design and engineering of the new circuit until such time as refining tests had been carried out on the Beaverlodge mill product. There was also the question of capacity. Should a new refinery be designed to handle all of Eldorado's known and estimated production - the output of Port Radium and the output of Beaverlodge - based on a mill with a capacity of 500 tons per day, or should it be designed for a larger Eldorado production given the potential for increasing the ore reserves at Beaverlodge to a point where the mill might be expanded to a rate of 2000 tons per day. For these several reasons,

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it was decided to postpone the refining project. Al Ross, very disappointed at this decision, was offered and accepted a position with another company, while in Washington, USAEC officials registered varying degrees of shock and dismay. This was hardly surprising. Jack Burger, somewhat to his surprise, was offered the position of refinery manager.39 There matters rested in November 1952. Eldorado had a plan, which it considered too expensive. It had access to new and useful information. The basic situation had not changed, however, and it was clear that something would have to give before too long. The beginnings of a solution occurred when Jack Burger started examining the existing space occupied by the refinery. It might, he told Bennett, be possible to revamp the refinery within its existing limits. 'Burger, you've got three months,' Bennett responded. Within three months, at the beginning of 1953, Burger had a plan.40 Thunaes and Burger then set to work to elaborate it. Its most attractive feature was its low capital cost, $2.1 million, as against the $7.5 million outlined by Catalytic. Discussing the project with his executive committee in August 1953, Bennett suggested putting the matter off until he had a chance to discuss with Atomic Energy of Canada Limited (AECL), of which he was also president, their requirements for uranium metal. Technical discussions between the two companies did take place, discussions which tended to confirm the desirability of refining to the metal stage, but in Bennett's opinion the whole issue of metal production was a secondary one. T must have been looking for reasons to postpone an immediate decision since our pressing problem at the refinery... was the production of a product acceptable to the USAEC.'41 Certainly the investigation of metal requirements did have the desired effect of putting off a decision until December, when the executive committee again met and approved the Burger-Thunaes proposal. Catalytic, which would still be handling construction, was instructed to proceed. Two features of this decision are of interest. First, the refinery was designed to handle 500 tons of feed per month. Henry's calculations indicated that Eldorado could expect all known properties to produce 440 tons a month, and so, with a margin for error, the refinery was designed to handle all anticipated Canadian production. This situation was consistent with

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Bennett's contention to the USAEC that a national policy of refining or manufacturing Canadian-derived raw materials applied in the case of uranium. Second, Eldorado decided to go ahead with the production of what Bennett called 'a high purity product' (99.8% pure) — 'regardless of the type of fuel ultimately used by AECL.' American, not Canadian, requirements were dominant, not surprising considering that Canada was absorbing less than 50 tons of uranium metal in any given year.42 Design and construction went ahead on the new uranium circuit through 1954 and into 1955.The estimate gradually climbed from the initial $2.1 million to $2.8 million. Thunaes's R&D divisio carried on parallel experiments to determine whether Eldorado could actually produce uranium metal for AECL cheaper than the USAEC could supply it; in this connection R&D found the Americans' own Fernald data extremely useful. Indeed, the connection between R&D and the refinery was close enough during this period that Bennett gave some thought to moving their laboratories to Port Hope. That idea was, however, abandoned in favour of keeping them in Ottawa close to the Mines Branch, and housed in a new R&D building in Ottawa's west end.43 The new refinery circuit officially started up on i June 1955. It is technically described as a 'solvent extraction' plant, meaning that it uses a method for upgrading elements in ores to a high-grade product. The high-grade product was UO3, uranium trioxide; with its achievement, the old UBO, uranium black oxide, became a memory, except, interestingly, as a unit of exchange in dealings with the USAEC, who insisted on computing raw material supplies by the old method of U3O8. We shall, therefore, continue to refer to .U3Os even though it no longer figured in Eldorado's refining process.44 The reformed refinery took a higher grade of feed from Beaverlodge, while still contending with the gravity concentrates from Port Radium. The difficulty of two kinds of feed was solved by blending the two just before the dry mixture was fed into a tank containing nitric acid. The result, no longer dry but a slurry of uranyl nitrate, moved on to the extraction circuit, where impurities were removed, leaving only uranyl nitrate. This was accomplished in 'pulse columns,' which agitated the slurry in tubes, several inches

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at a time, many times a minute. A solvent, tributyl phosphate, was pumped in at the bottom of the column while the slurry was pumped in at the top. A second pulse column repeated the purification process, and then a third. In the third column de-ionized water was introduced to attract the uranium and draw off the solvent, producing an 'aqueous solution' or, colloquially, the 'OK liquor.' The OK liquor was then boiled in steam heated evaporators until it reached a very heavy density (2.5 times that of water). It was next transformed into 'a doughy mass of uranyl nitrate' which, when further heated, became uranium trioxide. The last stage of heating drew off oxides of nitrogen, and the final product had the form of an orange powder: orange oxide or UO3. The ability to produce orange oxide or UO3 was a major step in the history of the refinery. First, it satisfied what the Americans wanted — a product of metal specification. Second, it enabled the refinery to produce, through further stages of refining, the uranium products required for nuclear power reactors whether they be fueled with natural uranium or enriched uranium. In these further stages of refining, the emphasis was on the production of uranium metal for use in Canadian reactors, which are fueled with natural uranium. The first step in the process was the production of UF4, commonly known as Green Salt (the technical term is uranium tetrafluoride). To make green salt, Burger was authorized to build further additions to the refinery. Its equipment was complicated and expensive, with a control panel all its own, necessary because the process required constant monitoring. The next stage, uranium metal, was achieved by a chemical reaction between UF4 and magnesium metal. UF4, which was pelletized, was ground up and blended with magnesium, and the mixture placed in a reactor vessel lined with a slag compound that would not melt at high temperatures. After heating, the pure uranium metal flowed out the bottom. The resulting ingot (or dingot as it was baptized from its resemblance to a derby hat) weighed around 4500 pounds. From ingots were fashioned fuel rods for the Chalk River reactors.45 Arrangements for producing metal were completed just in time for Chalk River to change its mind about the desirability of

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uranium metal as a reactor fuel. Tests had indicated that uranium oxide known as UO2 provided a more effective fuel element for the Canadian reactor. Placing pellets of uranium oxide inside a tube made out of an alloy of zirconium and then bundling them together converts the oxide into an effective fuel, much better behaved at high temperatures than pure metal would be.46 This change posed no great problem for the refinery. On the contrary, the production of UO2 was a much simpler process than the production of uranium metal. Oxide, green salt, or metal were not the only products issuing from the refinery. There were a number of by-products, and most of them undesirable. The company attempted to render these into a neutral form before disposal, but it was not always successful. During the 19505 the greatest problems arose in connection with a dump just outside Port Hope, near the village of Welcome. There waste was trucked and dumped, and there farmers noticed that their cattle were sickening and dying. The operative factor was arsenic, not radioactivity. It was not that the dumps were not radioactive; they were, but the radioactivity was judged to be at a low level and well below approved tolerances. Burger recommended that the company settle out of court, at a cost of $10,000 in 1955 and another $10,00 in 1956, the latter figure having been helped along by a sensational series of articles in the Toronto Telegram*1 There was another case which would not emerge for some years. A contractor hired by the company to haul away its residues to dumps took it upon himself to sell a few loads of contaminated earth for land fill. It was this land fill that, in the 19708, would cause considerable — and not unnatural — concern in Port Hope and set off a major clean-up of radioactivity in the area, a clean-up that, at the time of writing, is still under way. Nevertheless, Eldorado's dumping activities were not unusual for the time and the company believed that they conformed to established and indeed universally accepted standards.48 The refinery, therefore, remained an integral part of Eldorado's operations. It did not close down, or operate in some diminished form, as the USAEC suggested; rather, it was expanded and upgraded to process what Eldorado believed would be all available

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Canadian uranium as it emerged from the boom fields of Algoma and Athabasca. In this estimate Eldorado was wrong. As a consequence, Eldorado was not able to refine all of Canada's uranium; in the peak production years, 1958-60, it refined less than half. This fact of life was recognized in an amendment to the American production contracts in December 1955. 'Uranium,' it was decided, 'may be sold to the commission in concentrate form ... or ... the concentrate may be shipped by you to your Port Hope refinery for conversion into an orange oxide.' The refining fee paid by the Americans returned a hefty profit ($0.72 per pound as against costs of $0.325 per pound) but it was evident that most Canadian uranium would have to go south innocent of any treatment beyond the yellowcake stage — all but 3300 tons per annum. 'Canadian uranium,' Eldorado's Annual Report for 1956 confirmed, 'is now marketed as a high-grade concentrate, except that part of the production which is converted to a purified oxide (UO3) at the Port Hope Refinery.'49 There was no doubt, Bennett told the executive committee in November 1956, that the refinery was 'under-designed.' Part of the blame lay with deteriorating relations with the USAEC'S refinery division, relations that Bennett later termed 'unsatisfactory.' 'They did give us access to Catalytic,' Bennett concluded, 'but after that, nothing.'50 Was the refinery under-designed? Certainly Eldorado lost a lucrative opportunity to secure profits. The efficiency of the Port Hope refinery improved steadily through the 19505. Eldorado could therefore take advantage of better costs, and to that extent the company benefited. The company could not be blamed entirely for being overtaken by events. The magnitude of uranium discoveries in 1953 and after could not have reasonably been predicted, and it should not be forgotten that the very size of those discoveries was in itself a problem. Eldorado had to weigh very carefully whether it wished to expand its capacity to serve a possibly short-term American demand. Given the expansion in the Americans' own refining capacity, such a decision could not have been taken lightly. Given the future shape of uranium markets, it was probably wise not to take it.

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IV

The years between 1952 and 1955 were the high point of the Canadian—American uranium trade. Eldorado enjoyed excellent relations with the American USAEC, relations founded on the United States' itch to buy, and Canada's inclination to sell. The Canadian uranium industry remained regulated by the federal government, and Eldorado kept close control over its output because of uranium's importance as a strategic mineral. American purchases were for defence, and while the edge of crisis and panic that had characterized the first years of the Korean War had worn off, uranium was still treated as an essentially military commodity. Civilian participation in production was nevertheless admitted. Sixteen private Canadian companies eventually mined uranium, or held contracts that allowed them to do so. If they fulfilled their contracts, their costs would be met, and a profit added, but in the nature of things, some of these companies would hope to go on even after the military justification for their existence dwindled or vanished altogether. Thus, the expansion of the uranium industry into the private sector suggested at least the possibility of uranium becoming an actor in the politics of Canadian trade. The federal government had its own views as to how uranium should be developed. It should, in the first place, be developed under Canadian control. That did not mean - as we have seen in the case of Climax — that the government objected to foreign ownership or management as such; foreign-owned companies resident in Canada could expect to be treated just as Canadian companies were. But it did mean that the government deprecated the possibility of ownership, participation, or control by any foreign government. In Eldorado's own case, aid from the u.s. government that could have implied American inspection or direction was firmly rejected. Eldorado borrowed from the bank rather than from the USAEC, because it did not wish its arms-length relationship with its sole customer to be complicated by obligation. Eldorado also discouraged private companies from borrowing at the USAEC wicket. As Bennett explained in a letter at the end of 1954, 'This

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policy was based on our concern that financial participation by the United States Government or any of its agencies might create ownership rights. This, in turn, would complicate the carrying out of our procurement policy whereby all uranium sold in Canada must be sold to Eldorado.'51 The expansion of Canada's uranium industry was therefore as remarkable for how it was not accomplished as for how it was. There was very little government participation, except for a loose kind of certification through Eldorado's ore-procurement division. There was very little government money. Eldorado itself was financed through its own revenues or through bank loans. Other companies were financed in the same way. The financing was successful because of the virtual guarantee that costs would be recovered and because of the prospect, after amortization of investment, of considerable profit. As long as the American military demand lasted, there would be a seller's market for uranium. In 1952 and 1953 the United States was still making up a uranium shortage. But in 1954 and 1955 the signals were beginning, ever so slightly, to wobble.

Main Street, Uranium City, 20 April 1957 (courtesy, Eldorado Resources Limited)

The installation of pachucas in the mill at Beaverlodge (courtesy, Eldorado Resources Limited)

Dredge bringing up tailings, Port Radium, 1955 (courtesy, Eldorado Resources Limited)

Eldorado's board of directors and senior officers, 1960. Bill James is seated, right; Bruce Hunter is standing next left; Bill Gilchrist, wearing a tan cap, is seated in the centre; Frank Broderick is standing next left, and beside him is Arvid Thunaes. Eldon Brown is extreme left (courtesy, Arvid Thunaes).

OPPOSITE A.Y. Jackson and Hal Lake at Port Radium, 1950 (courtesy, Eldorado Resources Limited) At left, Buffam, the company's consulting geologist; on the right, with his hand to his cap, Gordon Dean, chairman of the USAEC (courtesy, Eldorado Resources Limited)

Prince Phillip and Bill Bennett at Port Radium, 1954 (courtesy, Eldorado Resources Limited)

Frank Broderick and Ted Spice in front of the leaching plant, Port Radium, 1951 (courtesy, Eldorado Resources Limited) Arvid Thunaes, Eldorado's research and development chief, and Jess Johnson, director of raw materials for the USAEC, 1955 (courtesy, Arvid Thunaes)

Port Radium, looking south across LaBine Bay, 1948. Bunkhouse can be seen on top of the cliff, along with the headshaft (courtesy, Eldorado Research Limited).

Springtime near Great Bear Lake. Note rocky terrain and sparse vegetation. The difficulty of landing an airplane is demonstrated (courtesy, Eldorado Resources Limited).

Dog teams are used to carry the silver-radium concentrates from the Eldorado mine on LaBine Point out to an arm of Great Bear where they are loaded by the company's Bellanca monoplane for shipment in winter to railhead (courtesy, Eldorado Resources Limited).

Eldorado's Bellanca, the Radium Silver Express, circa 1936 (courtesy, Eldorado Resources Limited)

Crashed DC-g at Beaverlodge. Dick Barrett, the mining manager, standing in front with hat (courtesy, Eldorado Resources Limited)

The Radium Gilbert, docked at Port Radium. The Gilbert had a 6-foot draft to cope with travel across Great Bear Lake (courtesy, Eldorado Resources Limited).

One of Northern Transportation's barge convoys (courtesy, Eldorado Resources Limited)

Alf Caywood, Eldorado's aviation chief, docking one of the company's Norseman planes, 1948 (courtesy, Eldorado Resources Limited)

10 Getting There Is Half the Fun Eldorado would not have existed - could not have existed — without adequate means of transport. Gilbert LaBine first came to Great Bear Lake by plane in 1930; thirty years later, the last inhabitants of Eldorado's Port Radium settlement took the plane out. In between, supplies shuttled in by aircraft and by boat and barge. The company could never forget that its ability to carry on its business depended absolutely on regular and reliable transportation in and out of the north. Most Canadians, between 1930 and 1960, relied on railways and highways to move around, and for getting their goods to market. Railways were an irrelevance in the Canadian north. The railhead at Waterways was half-way up Alberta; not until the 19605 would a railway snake up to Great Slave Lake. As for highways, they came to the Northwest Territories only in the 19508, and only in 1961 was Yellowknife finally linked to the outside world by an all-weather land transport system. Great Bear Lake and Lake Athabasca, the one isolated by distance, the other by swamps, could only be reached overland during the winter, when frozen terrain and ice roads permitted a modicum of traffic. Transportation and communications in southern Canada were maintained, for the most part, by the government. The government built highways and subsidized railways as part of the national commitment to overcome, as far as possible, Canada's excessive geography. But just where the geography really became awesome,

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north of the 55th parallel, the government's interest began to flag. There were not enough people to justify a truly large-scale investment in transportation, and there was never enough money in the budget, federal or provincial, to encourage a broad attitude to government assistance. Transportation in the north was, therefore, a private affair when Eldorado started to scratch at the rocks of Great Bear Lake. Private companies plied the rivers, where demand justified it, and private flyers droned overhead in their bush planes carrying prospectors like the LaBines to their improbable destinations. It was a situation ill adapted to the demands and needs of a mining company; because of those demands the system began to change. I

The Mackenzie River dominates the geography of the western Northwest Territories. Navigable from the Arctic Ocean to Waterways on the Athabasca, it dwarfs the St Lawrence, the Columbia, the Churchill, and any other of the great rivers of Canada. Its drainage basin, at 682,000 square miles, is the largest of any Canadian river. All of Eldorado's western operations were conducted within its ambit. The Mackenzie was the early fur-traders' highway to the sea. In 1789 Alexander Mackenzie sailed down it to the Arctic Ocean, and in the next generation other merchants and explorers followed where he had led; but not many, for the resources of the territory appeared to dwindle the further north one got, while the difficulties in travelling multiplied. Settlements, such as they were, centred on the fur-trading network of the Hudson's Bay Company, on missionary churches, or on the RCMP; in no case were they far from the river that linked them with the other, greater world of the south, from which their sustenance flowed. Bringing in supplies were the steamers of the Hudson's Bay Company that travelled downriver from Waterways to the first great set of rapids on the Slave River at Fort Fitzgerald. The rapids were too formidable an obstacle to be navigated, but, unlike the south, there was not enough traffic to justify a canal around them. The only alternative was to move freight north by road to Fort

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Smith, just north of the Goth parallel and the administrative centre of the Northwest Territories. Freight was re-embarked at Fort Smith for points north, as far north as the Arctic Ocean and the Mackenzie delta settlement of Aklavik, but until the 19208 there was never much of it and therefore little incentive to diversify the components of the delivery system. Navigation was not merely a matter of steamships and rapids. Just as important, navigation was by shallow-draft steamships. The Mackenzie basin does not, from a map, look like a water-starved area. It is, however, one of the drier sections of North America, with a level of precipitation equivalent to certain sections of west Texas or New Mexico. The Mackenzie River system is fullest in May and June, when its tributaries bring the spring runoff down from the Rockies. By August, the southern part of the river system is getting low on water, and instead of rain-bearing storms, the skies above are full of clouds of smoke from forest fires. Local inhabitants watch the water level, for as it falls so do their chances for a complete range of supplies for the approaching winter. The margin of safety can be as little as 18 inches; if the water level goes below that, the tugs and barges cannot get through and supplies may end up sitting on a sand-bar until the next spring flood. October marks the end of navigation north of Waterways, as boats are hauled up on shore out of range of gouging ice. The vessels that pass over the Athabasca and upper Slave rivers are necessarily shallow-draft. The typical barge, during the period we are considering, had to draw less than 18 inches in order to cope with low water in the Athabasca delta. Otherwise, barge and crew could expect to spend a certain amount of time admiring the ducks and muskrats with which the area abounds. Barges moving on the rivers were 'snubbed,' pushed from behind and closely tied together; on the lakes, however, it was a very different matter. At Fort Resolution, at the mouth of the Slave, the tug would move from back to front; the barges would then be towed, with loose and long tow-ropes between them, across Great Slave Lake. Barge design evolved over time. The first barges were small and narrow, and therefore inefficient late in the season, when low water levels diminished their carrying capacity. On the advice of a naval architect, North Transportation began to widen its barges, spread-

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ing the load as far as river channels could bear it. This permitted more cargo to be loaded in the later part of the season and increased the company's efficiency. For many years, the great variety of transportation conditions was matched by a paucity of traffic. Most traffic was connected, in one way or another, with the fur trade, and the fur trade did not require great volumes of freight or very frequent service. The Hudson's Bay Company held a near monopoly on the Mackenzie, and in the late 19205 the company shipped some 5000 tons down the waterway. Navigation was by tugboat and scow along the river proper, and, after 1926, by motor boat on Great Bear Lake. By the time LaBine arrived in the north, small shipments into Great Bear were no novelty, portaging past the impassable rapids on the Bear River and on beyond Fort Franklin into the lake. It was time consuming, and it was expensive. All this changed with the arrival of Eldorado. In 1932, the first full year of operation at LaBine's mine, no tons of freight were shipped in from Waterways, plus 125 tons of oil from Norman Wells on the Mackenzie. In exchange, 35 tons of ore concentrates went out. These figures would have to be multiplied to account for other mines and prospectors in the area. By the mid-19308, Eldorado was bringing in over 1000 tons of freight annually, not counting oil from Norman Wells.1 The cost was not small, either for Eldorado or for its competitors. Eldorado's first solution was to buy, in 1934, a Bellanca airplane, the 'Radium Silver Express,' to ferry its concentrates out and its groceries in. A competing company, White Eagle Silver Mines, preferred to rely on the water route, and bought out a small shipping company, Northern Waterways Limited. Northern Waterways was the ultimate product of a series of companies begun by Cy Becker, an Edmonton lawyer, who had had a bush airline, Commercial Airways, to support and service. In 1931 Commercial Airways' boats began to advertise for general cargo and the next year, when Commercial Airways was acquired by Canadian Airways of Winnipeg, the Northern Waterways company was born. The LaBine brothers observed the success White Eagle was having with its shipping subsidiary, and in 1936 they offered to purchase Northern Waterways from its owner, Colonel Mac-

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Alpine. MacAlpine was agreeable, and Northern Waterways, renamed Northern Transportation, became the property of Gilbert and Charles LaBine, with Gilbert as president. The next year, 1937, the LaBine brothers turned their interest in the company over to Eldorado for $87,500.2 Two consequences flowed from Eldorado's formal acquisition of Northern Transportation. First, with ownership and top management transferred to Toronto (for the next nine years either Gilbert or Charlie would serve as president of Northern), the fortunes of Eldorado and 'NT,' as it was usually called, became entangled. We need not follow here the complicated financial dealings between the two companies, but it should be noted that until 1946, Northern's bank balance, and even its ability to pay its employees, depended on Toronto's ability to come up with the necessary cash. It always did, but sometimes nerves in NT'S own head office in Edmonton were frayed in the process.3 The second consequence was of more lasting importance. Eldorado set about augmenting NT'S small fleet of tugboats and barges. The LaBines commissioned two steel tugs, the Radium King and the Radium Queen, at Sorel, Quebec, and had them shipped to Waterways and Fort Smith in prefabricated sections for assembly. A motor barge, the Bear, was despatched to Great Bear Lake, and with it a fleet of eight barges suitable for hauling oil from Norman Wells. The oil was initially portaged in; later it passed through a pipeline owned by Northern Transportation from the Mackenzie to Fort Franklin on Great Bear Lake. Two more steel tugs, the Radium Cruiser and the Radium Express, made their appearance in J 939While head office in Toronto decided NT'S overall policy, operations were confided to men on the spot. On the spot meant Edmonton, where Frank Broderick, a commerce graduate from the University of Western Ontario, sat, and the several agencies from Waterways to Norman Wells into which NT'S territory and business were divided. Directly under Broderick there came the operations officers: Kelly Hall, a failed stock broker from Winnipeg, who had taken what jobs had come his way during the Depression and finally qualified as a marine captain, and Jack Hewston, a Belfast Protestant who headed up NT'S marine engi-

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neering from his base in Waterways. An NT tug typically carried a crew of three, a captain and a mate, who came under Hall, and an engineer, who reported to Hewston. NT'S top-ranking personnel reflected their origins and preoccupations: Broderick, a Dublin Catholic, and Hewston, the Belfast Protestant; Hall, the operations man, versus Broderick, the financial manager. Broderick's work showed a tendency to expand over time, and he brought in from the field Bruce Hunter, the Bear River agent. Hunter, a graduate of the University of Alberta, had been with the company since the mid-19305. These four men, with assistance from head office, made up NT'S high command down to 1960, and it was thei responsibility to conduct the company's yearly planning exercise.4 The exercise was essential because of the limited number of ships and barges available for freighting cargo, and because of the limited shipping season in northern waters. Each year Broderick, Hunter, and Hall would have to calculate what cargo would be shipped downriver from Waterways, what its destination was, and how many ships could be available to carry it. Customers in the north were asked to work out their requirements for the next year in the fall, as soon as navigation was over for the current season. Based on those requirements, Broderick and his assistants could arrive at a budget and, as far as possible, a schedule for their tiny fleet. Cargo would arrive at Waterways by train during the winter and early spring, ready for loading and shipment as soon as the ice broke up. The greatest intangible at the beginning of any shipping season was the condition of ice on Great Slave Lake. The river ice generally broke up by the end of May, but the lake could, and did, take longer. Once the lake ice was gone, however, the Mackenzie was generally clear all the way to the sea. Under the best of conditions, cargo leaving Waterways would arrive at Yellowknife, on the north shore of Great Slave, between seven and ten days later; the shipment time of course included two days for portage between Fort Fitzgerald and Bell Rock, the shipping point adjacent to Fort Smith. Shipping times further down the river naturally were longer; Aklavik in the Mackenzie delta absorbed between 18 and 25 days' travel, a circumstance that limited the number of trips that could be made there in the course of the summer. To handle the traffic, NT maintained three river fleets. There

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were boats that plied between Waterways and Fort Fitzgerald. There was another fleet based on Bell Rock, which handled the Mackenzie all the way to Aklavik and later beyond, to Tuktoyaktuk (universally known as Tuk Tuk) on the Arctic Ocean. Finally there were river boats on the Bear River and lake boats for Great Bear Lake. All this, as might be imagined, consumed manpower and generated expense, especially the transhipment facilities between Fitzgerald and Bell Rock where, it was estimated, cargo had to be handled seven different times in moving from one barge to another. All cargo was handled manually, by locally recruited labour; volume did not justify any mechanization at this stage.5 NT'S appearance on the scene was credited with revolutionizing freight rates on the Mackenzie. In 1930 the prevailing rate between Waterways and Aklavik was $9.75 a hundredweight; in 1939 the cost had descended all the way to $2.50 for the same weight. The breaking of the Hudson's Bay monopoly benefited everyone in the Mackenzie valley, except possibly the Hudson's Bay Company itself, and naturally the reduction in rates benefited Eldorado in particular as its shipments increased and as the mine continued to demand new consignments of heavy, expensive equipment.6 The closing of the Port Radium mine in 1940 was a blow to NT. It reduced the company's volume of cargo at a stroke; there was not even any carry-over, since Eldorado simply abandoned its stocks of concentrate wherever they happened to be, in docks, warehouses, or simply on the shore. There was no need for it in Port Hope, and no desire to incur a penny more in cost. In these desperate circumstances the federal government stepped in. As an official explained a few years later, 'if the N.T. Company had not received ... Government freight they would in all probability have gone out of business.' If NT had gone under, the Hudson's Bay Company would recover its monopoly and that, in the opinion of the Northwest Territories' Council, was highly undesirable. Accordingly, the RCMP, the Department of National Defence, the Department of Public Works, the Department of Transport, and the Department of Mines and Resources gave NT their business, and continued to do so during the lean years of 1941, 1942, and 1943, until Eldorado and its mine were effectively back in business.7 Eldorado was by no means the only company expending its

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operations in the north during the war. Imperial Oil at Norman Wells found a ready customer in the u.s. military - so ready in fact that the u.s. Army built a pipeline, known as Canol, to transport its product to the Alaska coast. A second project, the Northwest Staging Route, was designed to handle air supply to Alaska in case of a Japanese attack. Coincidentally, they helped supply NT, and facilitated its operations. Expenditures soared, and freight volumes rose proportionately. In 1943, total traffic for all companies was 22,000 tons, rising to 44,000 the next year. Peace, and the departure of the military, brought traffic down to 29,000 tons in 1945, but 1946 saw a record: 50,000 tons. What the u.s. Army brought in, it did not want to take out. Surplus was sold at a low price to the highest bidder - NT. The bulk of the traffic was sti carried by the Hudson's Bay Company, although Eldorado's heavy concentrates gave NT the edge in southward-bound shipments.8 At the end of the war NT, like its parent company, came under scrutiny from the government and its agents. Lesslie Thomson, Howe's atomic factotum, severely criticized the management of the company — then under Charlie LaBine's presidency. Referring to LaBine, Thomson told C.D. Howe that T am extremely doubtful of his capacity to be president of anything requiring organizational talent or ability to plan ahead.' An on-the-spot investigation in September 1945 revealed that 'the Edmonton office was often ignorant of many decisions on matters of policy,' a circumstance which could be (and was) blamed on LaBine, but which also suggested that policy and operations be more closely combined.9 It was the end of the line for Charlie LaBine, who left both Eldorado and NT early in 1946, but it was an opportunity for Frank Broderick. Lesslie Thomson endorsed the devolution of responsibility upon Edmonton and upon Broderick; Bill Bennett, on becoming NT'S president in May 1946, continued Broderick in his position. Broderick, he later recalled, was a necessary brake on local enthusiasms, especially in the shipping department of the company; but at the same time he could be sure that if a recommendation got past Broderick, its antecedents and its justification were impeccable. Not everyone in NT appreciated Broderick's style of management, which some viewed as conservative and unimaginative to a fault; but Broderick maintained his

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ascendancy until his death in 1960. Caution, thoroughness, and persistence were qualities the company needed, and they did not preclude, as we shall see, necessary innovations.10 II

The post-war period posed a very difficult and very different set of problems to Northern Transportation. For NT, the fact that it was now government-owned had considerable significance. Since transportation was an essential feature of life in the north, transportation owned by government took on an added significance. What was once a luxury, and later a convenience, had become a necessity. Should it not, like other common necessities, become a government service, like the post office, the radio, or the police? As long as NT served Eldorado alone, its activities were not likely to attract attention. But NT had never confined itself to Eldorado. It was a common carrier, serving private customers from Fort Smith to Aklavik. It was not the largest carrier as yet, and it had competition, in the shape of the Hudson's Bay Company's river fleet, as well as the more recently founded Yellowknife Transportation. The competition was wasteful. The Hudson's Bay Company and Northern Transportation maintained parallel networks all the way from Waterways down to Aklavik, with the exception of Yellowknife, where the Bay did not run. As early as 1946, Bennett considered the duplication to be a fine example of pure waste, and he undertook discussions with the competition to discover whether the two companies could not profitably share some of their land-based facilities. Broderick, coming east to meet the new management, was, as Bennett recalled, 'horrified at the idea of getting into bed with the enemy,' and although the Hudson's Bay management was more receptive, for one reason or another the idea came to naught. The Hudson's Bay Company did not give up the idea of reducing competition, however; the next year, 1947, was its last on the river as a common carrier. By 1948 its river fleet had descended from 11 to 5 motor vessels, and its barges from 40 to 20. The Bay continued to carry its own cargo, but eventually that too was wound down, and it switched entirely to the services of its

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erstwhile competitor, NT. At the beginning of the 1948 shipping season, therefore, NT found itself dominant on the Mackenzie.11 It had by then become a rather large enterprise. It boasted 17 motor vessels, tugs, motorized scows of varying sizes. It had 61 barges, totalling 12,000 tons, to carry its cargo. Most of its vessels were made of steel, although three wooden tugs remained to remind it of its humbler origins. At Fort Smith, NT kept an assortment of trucks, trailers, and tractors to haul freight over its portage road. A similar collection was stationed at the Bear River, where it hauled equipment in and concentrates out over a road originally built (and subsequently re-built) by the federal Department of Public Works. There were, besides, 'offices, repair shops, living quarters for personnel and slipways for the repair and wintering of vessels.' Each major destination or transhipment point was designated an agency: Waterways, Fort Smith, Yellowknife, Bear River, and, later, Beaverlodge on Lake Athabasca.12 The little company that had broken the Hudson's Bay Company monopoly was now in a near-monopoly position itself. Its closest competition, Yellowknife Transport, was left far behind. This situation would have presented perils even had NT remained in private hands; now that it was a public company, its natural enemies multiplied. The most important factor, but by no means the only one, was cost. Costs in the north were high. NT'S shipping season was about half that on southern waters. Its equipment could be utilized only half as much as that further south. Its work-force was seasonal, it is true, but the expense of head office, capital investment, and permanent technicians had to be borne by a fleet that could work for less than a third of the year. Two approaches were possible to this situation. NT, like its parent, could become self-financing. Howe and Bennett naturally preferred this approach. Admittedly, profit-making transport companies were not the universal rule in Canada. Canada's nationalized railway system laboured under an inherited debt load that insured that it could never make a profit. Western farmers shipped grain to eastern markets under concessionary rates fixed by statute. Other special interest groups clamoured for similar treatment. Along the Mackenzie it was public policy to keep some kind of transportation network functioning, and to the local inhabitants

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the possibility that the government might help out in paying their freight bills had an irresistible allure. These issues were fought out before the relevant government authority, the Board of Transport Commissioners. Until the late 19305, common carriers on the Mackenzie had been responsible to no one; only in 1938 was water traffic on the river brought under a federal agency by any kind of legislation. No rates were established at that time, and it was only in the late 19405 that the board moved to investigate what kind of tariff public traffic on the Mackenzie River should bear. It was part of the Board of Transport Commissioners's powers to license common carriers on Canada's waterways, and to record the rates they charged. If there was a complaint, the board could then adjudicate. The organization, in its various forms, had been set up to deflect and defuse political agitation over the multifarious aspects of Canada's transport policy; in particular, Canada's politicians had wished to be relieved of the dangerous burden of creating endless local enemies by saying no to demands for subsidy. Bennett, sensing that Northern Transportation might soon be facing a formidable collection of would-be clients along the Mackenzie valley, decided that it would be best to regulate the northern barge traffic sooner rather than later. C.D. Howe had once been minister of Transport, and in any case official Ottawa was small. Bennett got to know, and to understand, several of the higher officials who worked under the politically appointed transport commissioners. He believed that they would be susceptible to an appeal for rates based on actual costs plus a modest profit, and he prepared Northern Transportation's case with this in mind. The board's officials were, to say the least, not wildly pleased at the idea of adding the Mackenzie to their mandate. Hearings were set for Edmonton at the end of January 1950, and the several parties to the hearings set out for the distant Alberta capital, including three transport commissioners. Not all of them made it. One commissioner was snowbound in British Columbia. Another promptly retired to his hotel room with a bottle of spirits and was not seen again. Only one commissioner would be in the right place at the right time to hear the Mackenzie River freight rates case. Should the board proceed? Certainly,

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Bennett argued. The commissioner present might not know much but the relevant officials did and they were there. And so, with several officials flanking him, a single transport commissioner opened two days of hearings on 30 January 1950 with the temperature down at — 5O°F. Everyone concerned was present: the competition, the Yellowknife Transportation Company; the customers, Cominco and Giant Yellowknife Gold Mines; the Yellowknife business community, through its Board of Trade; the territorial government; and the Northern Transportation Company, in the persons of Bennett, Harry Haydon, Frank Broderick, Bruce Hunter, and William McCreary, the company accountant. The board hearings consisted of the presentation of briefs, and cross-examination of witnesses by interested parties. As was to be expected, the customers plumped for lower rates, arguing that NT'S increasing efficiency allowed the company to take a lesser profit. The competition naturally did not argue for lower rates, while Mervin Hardie, speaking for the Yellowknife administrative district, created a minor stir by repudiating the brief he was supposed to present. Hardie's point, as far as he could explain it, was that NT was making a profit out of the Northwest Territories, and that the precedents set by the government's money-losing railway system ought somehow to be applied to the north. It was not especially difficult to reply to Hardie. The business complaints were in a different category. Their most prominent theme was that NT ought to reduce its rates on the Norman Wells—Yellowknife run; no reduction was sought on the route from Waterways to Yellowknife. The reason for the difference, NT responded, was obvious. The company lost money from Waterways to Yellowknife, and made it up from Norman Wells to Yellowknife. The two routes were connected, not coincident. In the previous year, 1949, no more than a 2.5% profit had been earned on Yellowknife business, a rate of return that few businesses would envy.13 The board evidently agreed. When formal freight rates were approved for water traffic on the Mackenzie, they were set above, not below, NT'S existing tariff. The solution to Yellowknife's grievances did not lie in the board's power, and certainly not by

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artificially reducing freight rates to an uneconomic level. The board's findings did not satisfy everyone. Six years later, when Saturday Night sent a reporter to Yellowknife to sound out opinion, he found that local citizens believed NT to be 'efficient,' but, as a territorial council member put it, 'the time was long overdue for a realistic reduction of its profits.' In an argument reminiscent of Hardie's, the councillor continued, 'We in the north don't want to see the company subsidized by the people of Canada but we can't see why those who are working to open up this area should subsidize the Canadian government through the profits gleaned from the freight rates we pay.'14 Viewed from the standpoint of profits, it was obvious that NT was a very successful company. Beginning in confusion and chaos in 1946, NT had required only one infusion of capital from its parent company, Eldorado. The infusion was sizeable, to be sure — $1.1 million — but it was fully repaid in 1950 and thereafter the company reports glowed with regular reports of after-tax profit: $33,000 in 1952, $156,798 in 1954, $466,450 in 1955, $380,222 in 1956, and $401,307 in 1957. The company was even able to help out Eldorado with a $1 million loan in 1952, in the wake of the mill fire at Port Radium. The company fleet showed a similar tendency to grow. Kelly Hall told the Board of Transport Commissioners that NT had begun 1949 with 17 tugs and 56 barges, a figure that included 13 new steel barges and a new tug, the Radium Yellowknife, , shipped up from the Yarrows yard in Victoria. From time to time, wear and tear required replacements, and, more infrequently, disasters took their toll. The year 1948 saw the sinking of a barge on the Athabasca River (it was salvaged) and an explosion on Great Slave Lake sent three steel barges to the bottom on the last trip of the year. The only other serious loss occurred in 1956, when the Clearwaterwent down on Lake Athabasca with the loss of the lives of its crew.15 The Clearwater, a shallow draft boat, had ventured out in a storm on the lake, and turned turtle. The expansion of the fleet, and the improvement of shore facilities, were all self-financed. The improvements, in turn, fueled higher profits and greater efficiency, not to mention shorter journeys north and less complicated handling. The most notable

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improvement came early: the installation of 'palletization' at the company's shore facilities to improve handling of cargo. Palletization meant the handling of cargo on wooden platforms, or pallets, which could then be lifted and carried by forklift trucks. It was a wartime innovation and it soon became widespread. It saved on labour, handling, and breakage — and time. Palletization was already a commonplace in eastern Canadian ports, and it was to an eastern shipping company, Canada Steamships, that NT turned for advice on the new system. Broderick was doubtful. Pallets and forklifts worked on pavement. What about gravel, earth, and mud? Receiving a favourable report in September 1948, the board decided to proceed. A forklift operating on pneumatic tires was suggested and adopted. It was too late for the 1949 season - pallets were in scarce supply, and could be reliably purchased only in eastern Canada - so 1950 saw the transformation. (The pallets were made of birch, and birch grew only in the east.) In the summer of 1950 palletization was implemented at Fitzgerald, Waterways, Bell Rock, and the Smith portage; the next year, 1951, it was installed at Bear River. The results were dramatic. At Smith Portage and Fort Smith, for example, labour requirements sank from 30 men in 1949 to 14 in 1950. The handling cost per ton of cargo fell from $24.62 in 1949 to $20.04 in 1950 — a reduction of 18.6%. NT passed on the savings to its customers, and abolished, as well, many special rates that had previously applied to delicate cargo. Breakage was less likely with machines than with men. In a minor recognition of the fact, George Inglis, the company agent at Yellowknife, applied for 121 pallets in October 1952. They were needed, he explained, to store empty beer bottles through the coming winter.16 The length of time consumed in shipping was also affected. What had taken 14 days to ship in 1949 took 7 in 1950. In a time of inflation and rising labour costs (15% in 1951), NT was able to save in its spending on casual labour, mess costs, wages, and employee transportation. From Ottawa, Bennett sent congratulations to Bruce Hunter: 'Since it is generally presumed that any comments I have to offer are critical,' he wrote in November 1952, T thought I would surprise you this time.' Hunter, he added, had sent in 'an excellent analysis'; better still, Hunter had revealed an unexpected

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drop in cost per ton shipped of 4 cents between the 1951 and 1952 shipping season.17 NT had other functions to perform. It was Eldorado's western junction point, as far as the long-distance telephone would reach. From Edmonton, urgent messages would be wirelessed on to Port Radium or, after 1947, to Beaverlodge; through Broderick's office passed the most confidential communications to the western mines. Relations between NT and the rest of Eldorado were not always placid. In August 1952, Broderick complained to Bennett that Beaverlodge had estimated 1300 tons of cement would be required that season. At the time of writing he had forwarded 1300 tons, and now an order had arrived for 1500 tons more. Bennett relayed the complaint to Lake Athabasca, and added a few of his own. It hardly indicated a foresighted management; but then, he might have reflected, the management was within weeks of being replaced. Beaverlodge was, of course, afflicted with all the unpredictable problems that any large, new engineering project might face. When construction lagged, the Beaverlodge project responded by demanding new supplies as soon as possible, and blaming NT for their failure to arrive. 'Do not think you are any judge to advise us whether ice is off lake,' an exasperated Broderick wired in May 1952. 'Suggest you confine your efforts and worries to more accurate freight estimates and priority lists [and] leave worries of boat movements to us.'18 NT'S operations during the 19505 showed two distinct trends. Until 1960 the tonnage of goods shipped continued to rise, while the proportion of tons destined for Eldorado tended to fall. Thus, in 1950, Eldorado and other federal government agencies accounted for 80.19% of NT'S revenue; in 1953, 71%; and in 1956, 37.19%. Tonnage always lagged behind revenue, a discrepancy that provoked some discussion between 1949 and 1951, but the direction events were taking was clear.19 A major factor in the expansion of NT'S business was the decision by the governments of Canada and the United States to construct a Distant Early Warning (DEW) radar line across the Canadian north. NT received a contract to haul in both heavy equipment and fuel for the construction sites, and, afterwards, a contract to supply some 25 DEW stations. Plans were accordingly laid to expand the NT fleet;

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they had to be scrapped when the Hudson's Bay Company finall abandoned the transportation business entirely, selling the residue of its river fleet to NT. The DEW line brought NT out of the Mackenzie delta beyond Tuktoyaktuk for the first time; before long the company became the common carrier for the entire western Arctic, and for eastern Alaska as well.20 What the government dispensed, the government could also dispose of. The completion of the Mackenzie Highway to Yellowknife finally transformed the environment that NT had grown up in. There was no need, any longer, for Yellowknife to depend on air and water for its substance. Goods could now be shipped in 365 days a year, weather permitting, and cheaper than they could be by water. The emergence of this alternative ironically marked the end of the line for NT'S official competition, Yellowknif Transportation, which was finally acquired by NT in 1965. The contraction of Eldorado's business to Lake Athabasca after 1960 kept the parent company confined to NT'S southern division; eventually, when the Beaverlodge mine closed in 1982, the connection between Eldorado and Northern Transportation ceased altogether.21 Had the connection worked? Eldorado got reliable transport at reasonable rates. It got it first by breaking the Hudson's Bay Company monopoly, and then by out-performing its competition. By instituting mechanization in 1950, Bennett started a decadelong decline in freight rates; by expanding the fleet out of NT'S profits he continued to out-pace the competition. From the parent company's point of view, therefore, the connection was decidedly advantageous. On balance, the same seems to be true if the link is assessed from the other end. The fact that NT was a nationalized subsidiary of Eldorado probably saved the company from being wound up at the end of the war, and secured it a million-dollar capital injection. It got priorities for scarce equipment during post-war material shortages, therefore allowing NT to buy ships when other companies might have faced delays and obstructions. Most important of all, however, was Bennett's assessment of the political environment in which NT was going to live. The attempt by NT'S Yellowknife clients to rewrite the rules of the northern transporta-

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tion game in the late 19405 left the company exposed to the possibility of arbitrarily low freight rates. Alternatively, NT could have become an instrument of broader government policy, in effect a social welfare agency whose primary function would be to spread social betterment and employment, and to relieve the boredom of northerners through frequent and subsidized service. In Bennett's opinion the Department of Northern Affairs and Natural Resources (and its predecessor, the Department of Mines and Resources) regarded NT not as a transportation company but as a service agency. Against Northern Affairs, the Board of Transport Commissioners was a necessary bulwark; a steady reduction in freight rates, Bennett hoped, would do the rest. In his view, NT would not forever remain subordinate to Eldorado, and his view was confirmed by NT'S success in attracting other business at the same low rates it offered to its parent firm. NT linked 1700 miles of waterways in Canada's north-west, steadily expanded its business and its field of operations, and made a profit. In this it resembled its parent. But there was no disguising the fact that by 1955 or 1956, Northern Transportation and Eldorado were proceeding on parallel rather than converging lines, and when Bennett and Howe began contemplating the future of Eldorado, Bennett made clear his view that their destinies were different. Northern Transportation, he told the minister, performed such a range of services for the Canadian north that it might properly be regarded as an essential national agency, like Trans-Canada Airlines or the Canadian National Railways. He did not, of course, mean that NT should be run on anything other than business lines, but it was evident to Bennett that since NT had created a transportation monopoly in the valley of the Mackenzie, it was in the public interest for the company to remain in public hands. Howe had not finally pronounced on the subject when his authority was unexpectedly terminated in June 1957. There is some evidence, nevertheless, that NT was due for a separation from Eldorado. In December 1957, Bennett relinquished the presidency to Frank Broderick. For the first time in 25 years top management had moved west. Circumstances did not, in the end, keep it there, for on Broderick's death in 1960, NT'S presidency was resumed by

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Eldorado's then president, Bill Gilchrist. The two companies were not finally divorced until 1974. Ill

For seven or eight months out of twelve boats would not float in the waters of the subarctic. Between freeze-up and breakup, Eldorado required the airplane. It was by air that Gilbert LaBine and his competitors first reached Great Bear Lake. Without aircraft it is unlikely that Great Bear could have been developed at all, far less explored. Aircraft going north to Great Bear usually followed the valley of the Slave to Great Slave Lake at Fort Resolution, and then moved on via Fort Rae to Cameron Bay. A regular air mail service was inaugurated in 1932, and in 1933 it was extended to the shores of the Arctic Ocean at Coppermine. The Royal Canadian Corps of Signals followed the air routes with a series of wireless stations including, as we have seen, one at Port Radium. During the 19305, there were tentative efforts at establishing a network of regular airstrips in the north, but such improvements as there were were directed further to the north-west, where the air route to the Yukon and Alaska promised more immediate advantages and profits. Eldorado had to make do with pontoons in the summer and skis in the winter, since the terrain around Port Radium offered little hope for a viable airstrip. It would not be until the 19705 that Port Radium secured a proper landing strip, at Glacier Lake; until then the nearest serviceable all-weather landing field was at Sawmill Bay, 40 miles to the south-west on the Leith Peninsula. This restriction limited the size of planes that could get right up to Port Radium. Eldorado's Radium Silver Express was an impressive aircraft for the mid-19305, carrying, as it did, 4000 pounds of cargo and travelling at 165 miles per hour (maximum). Made by the Bellanca Aircraft Corporation of Wilmington, Delaware, various models of Bellancas served all over the world as multipurpose freight and passenger aircraft. But the Bellanca was outclassed by the development in the late 19308 of the 003, the Dakota, which became the transport work-horse of World War n and possibly the most universally successful airplane of all time.22

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Eldorado had no need of aircraft between 1940 and 1942, but when the mine first reopened, the American government was only too happy to oblige with priorities and requisitions to get Port Radium operational again. By then the various frontier air companies had been consolidated under Canadian Pacific Air Lines and it was CP'S Punch Dickins who discussed with the u.s. government the means whereby Eldorado could become airborne again.23 It was not transport but exploration that brought Eldorado back into the aircraft business. Allied needs for uranium were matched in magnitude only by the perceived shortage of the substance. As we have seen, this led to increased exploration for uranium in the Northwest Territories during 1943, and to the assumption of control over all radioactive substances by the federal government in September of that year. Eldorado was the natural choice to substitute for American-sponsored geological parties in the northwest, and by the end of 1943 efforts were under way to expand the company's capacity for exploration. To be productive, exploration had to be conducted on a large scale. The best way to do that was from the air. Aircraft were hard to come by during the war, and the secret nature of Eldorado's business suggested that exploration should remain, as far as possible, an in-house affair. To establish an aviation division required expert advice, and to get it LaBine hired Alf Caywood, a Canadian Pacific pilot operating out of Edmonton. Caywood had got into aviation the hard way, working as a grease monkey on the ground until he qualified to fly. Flying in the Canadian north-west placed a premium on ingenuity, which Caywood had in abundance. It was also a skill that demanded close attention to costs. Caywood, Bennett later recalled, had 'a fine head for figures,' which meant that he could keep tabs on office work and inventories as well as on flying and maintenance. Caywood's unique combination of skills meant that he could set the pace for Eldorado's aviation division. The fact that he could work on any aspect of aviation helped him to maintain discipline in his crews, since it was obvious that they were not being asked to do anything that the boss wasn't ready to try for himself. Technically, Caywood was on temporary assignment to Eldorado for the duration of the war emergency. His leave from CP Air

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had a habit of extending itself, and finally, much later, he officially transferred to Eldorado. By then he had a number of years' experience in running his own little airline. It started off small. Eldorado, in Caywood's opinion, needed two aircraft for its exploration program, and the best one for the job was made in Canada, in Montreal, by the Noorduyn company. The Noorduyn Norseman was the first bush plane made in Canada from an entirely original design. According to the historian of Canada's aviation industry, the Norseman 'appealed to many of the bush operators because it was faster and offered considerably more passenger comfort.' Two Norsemen, with parts, cost $110,000, a sizeable sum, but one which Howe had no difficulty authorizing. Since the Norseman's engines were not made in Canada, priorities had to be obtained from the American authorities, as well as from Howe's own director-general of aircraft production, who controlled the dispensing of airplanes in Canada. The RCAF'S Air Observer School in Edmonton promised all aid short of spare parts, Caywood recruited some ground staff and a second pilot, and Eldorado's aviation arm was in business.24 Two Norsemen were handed over to Caywood and 'Westy' Westergaard, another pilot, in Montreal at the beginning of May 1944, and were duly baptized CF-BXK and CF-BXL. They received registration as 'state' rather than commercial aircraft — a matter which was referred to Bill Bennett as Howe's executive assistant and, on 7 May, Caywood took off for points west. Aviation set up its headquarters in Edmonton and in June, after pontoons arrived from Montreal, Caywood started flying north. His first summer's work involved ferrying passengers to and from the mine, servicing exploration parties, and carrying geologists from place to place, as well as minor freight. According to LaBine, Eldorado's two-plane aviation division was being 'worked to capacity'; at the same time, he noted, it was being forced to live hand to mouth in terms of spare parts.25 The two Norsemen constituted the company's air fleet only until 1946. By then what had been scarce during the war had become surplus, or at any rate, cheap, and Caywood heard that a DC-g was available. A 003 was a very diffrent kind of plane from the Norseman. It was a work-horse, capable of handling three-ton loads of cargo and therefore able to undertake regular drop-offs

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and pick-ups at Port Radium. On the other hand, while a 003 would work on skis or wheels, it would not work on pontoons. It would, in other words, need a runway. The nearest and most suitable place for a runway was, as we have seen, at Sawmill Bay, across the lake from Port Radium. With his runway identified, Caywood went off to buy his plane. They sold a Norseman (a third had been acquired the year before) for $29,000, and bought a 003 for $22,000. Its first trip was in the spring of 1946, carrying u.s. Army surplus over to Port Radium from Wrigley Field in the Mackenzie valley. To Caywood, Bolger, and Walli, who was then working on exploration, the 003 was the greatest convenience since the reopening of the mine. To LaBine the idea of a mining company owning a transport was unfamiliar, to say the least. 'He started to rave,' Caywood chuckled, 35 years later. 'Hell,' LaBine shouted, 'we won't need that airplane. Alf, I don't know what's wrong with your head.' By then there were rumours that LaBine's authority was no longer quite what it had been, and soon word came that Bill James was bringing out the new vice-president and executive director for a look around the properties. Caywood decided that he had just enough time to finish his runway. He borrowed a cat and two ground crewmen from Bolger, and shipped them across to Sawmill Bay. Then he cut a line from one end of the runway to the other, 5000 feet long, and told them to clear it. For the $2000 Caywood promised, plus $ i a lagging, they were ready to do it in jig time, and they did. Nine days later the airstrip was ready, and Bennett flew in.26 It was, as Caywood proudly reported the next year, a considerable success. The 003 delivered personnel, perishables, and packaged goods to Port Radium, and concentrate to Edmonton. It flew eleven months out of twelve (omitting November because of freeze-up). In 1947 it flew 220 round trips and carried 783.44 tons of freight, 171.6 tons of personnel, and 694.66 tons of concentrate, at a cost per ton of approximately $146. Tt is believed,' Caywood pointed out, 'that this operating performance represents a new record for the utilization of this type of aircraft.' It was the first extensive use in Canada of the 003 for freight and passenger haulage. Life at the mine improved substantially. Except during Novem-

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her and June the miners got fresh food and regular mail, and allowed the company to reduce the inventory it kept on hand at the mine, with resultant savings. As Eldorado's 1947 Annual Report noted, 'The transportation of concentate on return trips has also assisted in the maintenance of the Company's ore control system inasmuch as it is doubtful whether the entire tonnage produced in 1947 could have been cleared by boat to railhead at Waterways before freeze-up.' The DC-3 worked so well that in December 1947 the company picked up another one. The government's War Assets Corporation had one ready to sell, for the bargain price of $5000. The company's own mechanics converted it at a cost of $28,000; when the first aircraft, DGJ, came in for overhaul, the second was ready to take its place.27 To keep the aircraft aloft, Eldorado had a staff of 25: 7 pilots and co-pilots, 2 flight engineers, a maintenance crew of 10 mechanics, and an administration staff of 6. The glamorous end of the operation was the pilots, although every pilot doubled as a baggage handler and stevedore, but equally important was the maintenance program inaugurated by Caywood, Roland Morin, Clive Macpherson, and the maintenance crew. The crew was ready to handle everything except engines, and strove to keep the aircraft in top shape at all times — 'preventive maintenance,' as Caywood called it. Preventive maintenance had also to be creative maintenance: scarce parts could be, and were, produced on the spot. Sometimes, as time passed, they had to be.28 The exploration program continued. During 1946-7 Eldorado exploration parties were as far afield as Bathurst Inlet, on the Arctic Ocean, and the Norsemen made regular trips to keep the prospectors in supplies. One plane was based at Port Radium, to handle the central and northern Arctic, and the other at Fishhook Bay, close to the future Beaverlodge mine. It looked after the terrain between Great Slave Lake and Lake Athabasca. Once a week, a prospecting party could expect the Norseman to drop in, bringing food and taking out samples and reports. If the reports were sufficiently discouraging the plane would be back to carry the explorers somewhere else. Flying so far and so frequently, the Norsemen sometimes ran into problems. There was weather,

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which once kept Bennett and his party grounded at Bathurst Inlet for four days, sitting on top of a diminishing store of food. The Eldorado air fleet did not survive unscathed. With so many trips and so much time spent in the air the pilots were, as Cay wood said, 'breaking records every day.' It was not unusual to fly 150 or 200 hours a month, and in the spring it was 6 trips a week. The cost of shipping the concentrate was absorbed by the USAEC; in any case, Caywood claimed, they got it cheaper by plane than by boat: $ 150 a ton as against $175. In return, there were accidents. The first, on 20 November 1948, deleted one of the Norsemen from the company roster, when it plunged through the ice at Leith Point on Great Bear Lake. On the other hand, as the Annual Report noted, 'the depreciated value of the aircraft was $1,565.03. Insurance recovery amounted to $35,ooo.oo'29 For the next three years Eldorado aviation operated with two 0035, the surviving Norseman, and a smaller Fairchild more suitable to exploration work. It could rise to special occasions, as the destruction of the Port Radium mill demonstrated in 1951. All necessary supplies had to be airlifted in. At the same time, however, the construction at Beaverlodge placed heavy demands on aviation's resources. Caywood afterwards swore that he could have done it all using nothing but Eldorado's own pilots and equipment. Whether that was so or not, he had the assistance of the United States Air Force, which Bennett, acting through General McNaughton, had procured for the task. To handle increased demand, Eldorado leased a €-46 transport in 10)52. It was the largest twin-engine transport plane in the world, and bore the nickname 'the flying whale.' Tonnage increased in 1952 to 4000, up from 2200 the year before and 1600 in 1950. Company aircraft were now flying a triangular route, from Edmonton to Port Radium to Beaverlodge and back, on a regular, twice-a-week schedule. It was on one of these flights that Eldorado lost a DC-3 coming in to land at Beaverlodge. It happened afte dark, on an airstrip that, strictly speaking, should not have been handling night traffic. But it was convenient, and from time to time planes could land, using ground flares for guidance. On the night of the crash the flares were out as usual, and the plane was coming in to land when a truck drove onto the airfield. Its headlights

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confused the pilot, who slewed his plane off the runway. The 003 was 'damaged beyond repair.' Its fuselage was still more or less intact, and for years thereafter it serviced the community of Uranium City as a picturesque, cigar-shaped, diner. The federal Department of Transport took a dimmer view of the proceedings. Night landings at Beaverlodge were stopped until the airport was equipped to handle them.30 Aviation received a promotion in 1953 when it was hived off as a separate company in order to satisfy the requirements of the Air Transport Board, the federal agency that regulated Canada's airways. The board was concerned to keep Eldorado within the terms of its licence, and the licence stipulated that the company use its air arm for internal services only. Eldorado had established the practice of charging its employees their air fare to and from Port Radium and Beaverlodge if they did not complete their work contract of 350 shifts. The chairman of the Air Transport Board advised the company that its flying licence did not permit this practice. The problem was solved by creating a subsidiary, Eldorado Aviation Limited, which could obtain the appropriate licence. Alf Caywood became president and general manager, but as president of a wholly owned subsidiary, he responded to the policy directions of Eldorado's own board.31 Caywood's organization was always small. The air fleet suffered accidents and attrition: a Norseman went through the ice at Port Radium in 1952, and was salvaged. It survived another five years, only to meet its demise in a clump of trees near Fort McMurray in 1957. The €-46 was also gone. Eldorado was faced with the task of replacing them. Replacement took the form of a 004, bought in 1957 from Alaska Airlines, and another DC-3, purchased in February 1958.32 The 004 doubled the DC-3's carrying capacity, and dwarfed the 003 on the runway. Given the extraordinary longevity of Eldorado's aircraft, it is not surprising that the 004 remained in service until 1980, long after most of its peers had been retired to scrapheaps and museums. The extraordinary care taken of Eldorado's airborne fleet, the long service of its employees (out of 34 employees in 1964, 16 had been with the company for over 12 years), and the adoption of palletization helped to reduce the cost of flying to one of the lowest

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levels ever achieved in Canadian flying. Caywood's crews regularl moved cargo for less than it would have cost by ship and train between Edmonton and Port Radium, and it went without saying that they could do it in a fraction of the time. At its peak, Eldorado aviation averaged 15 cents per ton-mile, and did even better under favourable conditions. It could do so because its cargo handling was cheaper and simpler than that of its competitors. (Typically, Caywood made the pallets in the hangar at Edmonton; later, when he discovered that poplar made the best pallets, he moved the operation to Fort McMurray, in the middle of what he called 'poplar country.') It helped that Eldorado flew into Port Radium or Beaverlodge fully loaded, and that it flew out in the same condition. Very little space was wasted, contributing greatly to company aviation's economical operation.33 Unlike Northern Transportation, Eldorado Aviation was never called upon to fulfil a public role. Suggestions that the airline become a common carrier were firmly discouraged on the ground that the company was already doing very well just as it was. Its parent would do no better from expanding its subsidiary, and the experience of NT showed what could happen once common-carrier status was attained and politics came through the door. For Eldorado management the cost per ton-mile figures achieved by its aviation arm spoke for themselves; it did not seem, on the face of it, that the management of the company would be improved by diversifying its functions or on the other hand that the company would be better off if it disposed of its aviation division and went back to a condition of dependence on other carriers. When, around 1960, the possibility was raised of disposing of the aviation arm, an appraisal of Eldorado's subsidiary showed that it was running as efficiently as any company in the business, and that Eldorado was as well served under these circumstances as it could be under any other imaginable ones. IV

The history of Eldorado's two transportation arms demonstrates interesting contrasts and similarities. Northern Transportation predated Eldorado, and by the time it was bought by the company

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it had already injected itself into the role of a common carrier along Canada's last great unregulated waterway, the Mackenzie River. It remained a common carrier in order to survive, especially in the bleak years between 1940 and 1942 when its parent company could give it little but sympathy and no traffic. NT expanded under the impetus of Eldorado traffic, but its expansion also enabled it to compete effectively, and finally successfully against its rivals on the Mackenzie River water route. There was probably room for only one full-sized water transport company in the Mackenzie valley - unless, of course, subsidies were employed, and from 1948 on NT enjoyed a quasi-monopoly of commercial traffic on the river. Under the monopoly, rates declined as the company reinvested its profits in new equipment and mechanized cargo handling. That fact helped NT to beat off the demands of special interest groups among its clientele; paradoxically, spending money helped keep the company firmly placed as a profit-making organization rather than an aquatic social-service agency. Eldorado Aviation Limited (EAL), as it became, was always much more closely tied to its parent company. To a greater degree than NT, it was dominated by the personality of its general manager and founder, Alf Caywood, and while other personalities played an important role in the organization over time, it is difficult to avoid the conclusion that Caywood's presence at EAL was a particularly fortuitous circumstance. For years EAL was in the habit of settin records of one kind or another. Operating with two 0035, EA carried more air freight than all other Canadian airlines combined in 1947. Operating in Canada's most difficult terrain, it nevertheless steadily reduced its costs per ton-mile of cargo carried. And while it had accidents, it never lost a life.

Interlude Atoms for Peace

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THE YEARS BETWEEN 1951 AND 1953 were a time of great political change. The British voted out Attlee and Labour, and voted in Churchill and the Conservatives. The Americans threw out the Democrats, and chose instead the Republicans under General Dwight D. Eisenhower. In Russia, the dictator Josef Stalin died and was succeeded, briefly, by a 'collective leadership' that showed a tendency to become less collective over time. The Korean War ended, possibly because Eisenhower threatened to use nuclear weapons to end it. And in Canada the Liberal party, under Louis St-Laurent and C.D. Howe, was re-elected. The governments of the United States, Great Britain, and Canada were, on the surface, more committed than ever before to keeping up Western defences and North Atlantic political unity. Eisenhower had been NATO'S first supreme commander, and he was known to value the United States' overseas alliances. Churchil liked to remind the Americans of their wartime comradeship, and to cast a sentimental haze over Britain's weakened economic and military situation. St-Laurent hoped to build bridges between Canada - and, by extension, other rich Western countries - and the emerging nations of Asia, an effort which his energetic Minister of External Affairs, Lester Pearson, seconded on every possible occasion. Diplomats in Canada, and not only in Canada, were contemplating the possibility that the termination of the Korean War and the death of Stalin might make it possible to unfreeze parts of the West's relations with the Soviet Union. Peace would be strengthened thereby, and military budgets could be reduced. Below the highest level, and sometimes even there, the election of so many new people to office added uncertainty to the conduct of international relations. The Eisenhower administration had its internationalist wing, which the president himself represented and sometimes led, but it also kept track of its domestic political debts. It was prone to sacrifice certain foreign interests - in agriculture, for example - in order to solve thorny political problems at home. It listened to American producers of food, of raw materials, and sometimes of manufactured goods, but it had trouble hearing their foreign competitors. There was a suspicion, too, among foreign diplomats that the American government went out of its way to

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create dramatic pseudo-events in the belief that a day or two's favourable publicity was worth a foreign policy triumph any day. Sometimes the impulse to grab headlines coincided with an equally strong impulse to do good by making a dramatic gesture of principle. Eisenhower had such a principle in mind during the fall of 1953. He hoped to restart talks on atomic disarmament or international control of atomic energy, stalled since the collapse of the Baruch Plan at the end of 1946. He was impressed by the evident progress of nuclear technology, which he also believed was bound to be a scarce, difficult, and expensive resource for the future. It was something of a luxury item, in part because of what Eisenhower called the 'limited available supply of raw material,' in part because reactors designed to turn atomic energy into usable power were still very much in the development stage. It seemed to the American president and his advisers that the United States had a great deal to offer, and very little to lose, if it shared some of its rare atomic resources for the benefit of mankind. Mankind in return might then eventually agree to place the power of the atom in restraint.1 The idea even now has its attractions. Eisenhower seems to have run it past the British and French at a conference in Bermuda. They presumably agreed, or at least offered no serious objections. On his return to Washington, Eisenhower set his speech writers to work on an oration with the necessary power, drama, and lack of specifics to carry a case-hardened audience with him. He would present his speech at the United Nations on 8 December 1953-2 The speech did everything the president hoped. It was a powerful, moving, and inspiring presentation of the case for international atomic collaboration. The catch-phrase he offered was 'Atoms for Peace,' and it immediately caught on. How would Atoms for Peace work? Eisenhower had a couple of suggestions. There would be an International Atomic Energy Agency, authorized to receive contributions from the atomic stockpiles of the existing atomic powers. This 'atomic pool' would be used to promote the peaceful uses of atomic power which, Eisenhower told the world, were just as awesome as its better-known military applications. Awesome, and sometimes just as fantastic. Headlines

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in the months after the speech catch the mood Eisenhower succeeded in evoking: 'Nuclear Device in Fight Against Cancer' (true); 'Forestry Expert Predicts Atomic Rays Will Cut Lumber Instead of Saws' (false); 'Atomic Locomotive Designed' (false). Propaganda was not restricted to print. Radiation and its effects also caught on in Hollywood, as viewers of the movie short Atomic Zoo could attest; there was a vogue of pleasurably implausible atomic monster pictures for the next couple of years.3 Eisenhower's speech did not stop the nuclear arms race. Both the Soviet Union and the United States continued to increase their nuclear arsenals, as did, on a lesser scale, the British. The French decided to develop atomic weapons of their own, using their already formidable scientific knowledge. But Eisenhower did go some way to opening up an international dialogue on atomic research. Conferences would be held; scientists and technologists would exchange information in an open international forum, the first since 1946. What they had to say was unexpected; and as a result, the international standing of atomic research was revolutionized in a very few years. This movement inside the international atomic community had implications for Canada as well. The structure of atomic energy in Canada had been determined by the Cold War and the consequent military importance of uranium and atomic energy. For the first time in a decade, a significant civilian aspect had been discovered in atomic research, and with the re-emergence of the civilian side of atomic energy there came the renewed interest of the 'civilian' side of government in the subject. The world of 1953—7 was therefore a more complicated world, both from the standpoint of Canada and from that of Eldorado. The complications were not entirely unwelcome, because of another, parallel, circumstance. As the civilian side rose, the military began, slowly, to decline. It was certainly not that the American or any other government lost faith in nuclear weapons either for defence or for deterrence. But even the Americans, as their weapons stockpile passed the 10,000 mark, began to wonder whether they had not surmounted the worst of their defence problems. Nuclear weapons were comparatively cheap — compared to the expense of maintaining a huge, unwilling, and

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expensive overseas conscript army. The Soviet Union thought the same way. Nikita Khrushchev, who after 1955 held the reins of power in Moscow, succeeded in bringing the levels of the Soviet armed forces down from 5.7 million men in 1955 to 3.6 million in 1958. This might be taken as comforting, but it was accompanied by a commitment to make the war of the future an exchange of nuclear-tipped rockets.4 The USSR, therefore, continued to develop its rocket forces. By 1961 their stockpile was estimated at about half that of the Americans. The Americans were building more slowly. As the rate of the American program slowed, so did the rate of American demand for raw materials. What would finally happen was difficult to predict with any certainty, but it became an increasingly reasonable guess that the USAEC goose would eventually run out of golden eggs, as far as Canada was concerned. Under the circumstances, Canada was anxious to diversify its uranium markets. The new depressurized international climate of the late 19505 gave it the opportunity to do so.

11 The Politics of Peace

In 1959 uranium was Canada's principal mineral export, ahead of aluminum and iron ore and nickel, too. Only lumber and timber, pulp and paper, and wheat were more important. Uranium had become a principal entry in Canada's balance of payments, and its importance to the government increased proportionately. The contracts negotiated between Canadian uranium companies and Eldorado, and between Eldorado and the u.s. Atomic Energy Commission, were intended to deliver uranium to the United States at a date no later than the 3ist of March 1962, a date later revised, in some cases, to 31 March 1963. A billion and a half dollars worth of uranium, therefore, would move south in a comparatively short space of time, with the maximum impact occurring in 1958, 1959, and 1960. That circumstance alone would have brought uranium to the attention of the cabinet. There were, however, other factors that also demanded cabinet time. Eldorado was promising to purchase a very large amount of uranium for a very large sum of money. Behind Eldorado stood the u.s. Atomic Energy Commission, but the USAEC was not alone. Should the USAEC fail to meet its commitments to Eldorado, the Government of Canada would have to step forward to assist the company to meet its obligations. It was, to be sure, a very remote possibility, but a prudent government would consciously have to be engaged in the matter, and consciously grapple with a possibility, however remote, that would

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commit it to pay out a sum equal to one-quarter of Canada's annual budget. Eldorado would, therefore, be on the receiving end of an unusual amount of scrutiny between 1953 and 1957. It became a matter of great importance to the company to get the USAEC to set down its commitments, and to define precisely what it would want to buy. Eldorado was seeking the freedom to plan its future, and that of the Canadian uranium industry as a whole. The company began to explore ways of diversifying its sales, both in kind and in destination, and to look for means of broadening its mandate. In doing so, it would have to cope with the beginnings of an uncontrolled international market in uranium, and with the dismantling of the cozy three-nation club that had overseen uranium sales ever since the Manhattan Project. I

Let us begin with the USAEC. The u.s. Atomic Energy Commission had changed its commissioners (but not its direction) when the Eisenhower administration took office at the beginning of 1953. Gordon Dean left office, and Lewis Strauss, a prominent Republican investment banker and sometime admiral, replaced him. Strauss was known to be a difficult personality, personally charming but also rigid and unbending; to this list some would have added partisan and vindictive. He was, however, aggressive in his agency's behalf and influential in the White House, where he helped originate the Atoms for Peace speech. Strauss was looking for a political triumph rather than for any particular scientific benefit in encouraging Eisenhower along the road of Atoms for Peace. He did not anticipate that the Russians, with their secrecy mania, would ever be able to respond in kind to a generous American offer of information and materials. In this matter, and in some others, he would prove to be wrong. While Strauss's attitude to the Soviet Union lacked imagination, his view of the British was virtually the opposite. There, Strauss built on well-publicized examples of leaky security to justify a continuing and unforthcoming attitude to the sharing of technology. Canada did not confront Strauss with the same problems the

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British did. Canadian security policy was tighter than the British, and it proved no trouble in 1955 to negotiate a security accord between the USAEC on the one hand, and Eldorado and Atomic Energy of Canada Limited (AECL) on the other. Strauss and Bennett got along well and, equally important, Strauss and Jesse Johnson, Canada's principal contact in the USAEC, also saw eye to eye. From Eldorado's point of view, the successful security negotiations only confirmed the company's generally good relations with the Americans. The Americans were almost too cordial, unwilling to contemplate the possibility of change, of slippage, of alteration in the character of their purchases in Canada. And thereby hangs a tale. It begins with the success of the USAEC'S various procurement programs. It will be recalled that the USAEC dealt with its suppliers in three ways. Canadian producers were handled through Eldorado, that is to say, through the Canadian government, American producers were dealt with directly, and overseas suppliers came under the aegis of the Combined Development Agency (CDA). These suppliers were located in the Belgian Congo, South Africa, and Australia. Each of these categories displayed a steady growth. In 1953, the year in which Beaverlodge entered production, the USAEC procured 225 tons of U3O8 in Canada. It also got 824 tons domestically and 2623 tons overseas through the CDA. By 1957 the situation had been revolutionized. That year, domestic u.s. production was 7582 tons, Canadian production 3371 tons, and overseas supply 5206 tons. In 1958, Canadian production surpassed overseas supply for the first time, while American production also continued to move up. Overall totals moved from 2887 tons in 1953 to 16,159 tons in 1957 to 26,375 tons in 1958. Through the CDA, Canada had access to these figures as well as contractual information and geological projections.1 George Bateman continued to serve as Canada's representative on the CDA, and as a member of the Canadian Atomic Energy Control Board (AECB). His assessments were consistently optimistic. True, uranium purchases were passing the limits of rational military use, but Bateman was alive to the strides science was making towards producing an economically feasible nuclear power reactor. Others shared this view, in varying degrees, but those

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degrees had some importance. Granted that nuclear power would prove to be the source of the electricity of the future, how soon could that happy future be brought to happen? Would it dovetail neatly with a decline in military needs, or would there be a hiatus? This puzzle troubled C.D. Howe. At a lecture in the University of Toronto, the minister predicted a rosy atomic future. He had just underlined the importance to be accorded to atomic energy by constituting a separate crown corporation, Atomic Energy of Canada Limited. C J. Mackenzie, who was a year from retirement, was persuaded to move from the National Research Council to AECL; then, in July 1953, Bill Bennett added the AECL presidency to his portfolio. Mackenzie stayed on as chairman of the AECB; he would last, in fact, until 1961, a remarkable tenure. Bennett was concerned to explore the potential market for nuclear power in Canada and promptly commissioned a study to see what it might be. (At the same time he received another study telling him what he already knew, that it would make little sense to merge Eldorado with AECL.) The investigators reported positively on the need for nuclear power in Canada, so in 1955 Bennett recommended to Howe that a demonstration power reactor be built and Howe approved. The NPD, as it was called, would be built and operated jointly by AECL and Ontario Hydro. Bennett made an appropriate announcement in a speech to the Toronto Board of Trade in January 1955. There would be a power reactor program, and it would keep Canada in the forefront of nuclear research. But Bennett found it necessary to add that the requirements for uranium to fuel Canada's own atomic program were not, and would not be, very large. There was also a possibility that what he termed 'the military requirement' would also diminish, while export markets were unpredictable. Yet it might well prove to be export markets that Canadian producers would have to aim for; and in that case, Bennett warned, they must 'expect to meet the same conditions which prevail in the case of other base metals which are not in short supply.'2 Given what came later, it was a gentle warning. Bennett had good reason to give it. The month before, in a letter to Sir Edwin Plowden, the head of Britain's Atomic Energy Authority (AEA), he wrote that it was 'my impression from informal conversations in

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Washington that production, as now forecast, will be sufficient to meet the military requirements as they are now estimated.' That would not have an immediate impact, since the USAEC had guaranteed purchase up to the end of March 1962. In the fall of 1954, Bennett and Bateman had begun to nudge Jesse Johnson to make a decision, or a promise, about post-1962 production. Would the u.s. extend the period of its purchases and at the guaranteed price? Johnson was as aware of the difficulty the USAEC faced, as Bennett was. He found it advisable to examine, in public, the prospects and prices of a hypothetical post-military market. At the same time, Bennett wrote, 'I understand Johnson has recommended that the period of the guaranteed price be extended until March 31, 1965.' If that happened - and the USAEC had made no decision - then Bennett thought it likely that Canada would continue to make deliveries to the United States. He did not think it likely that the United States would want all of Canada's uranium, but as long as it wanted some, Bennett argued that the mere fact that the pre-1962 contracts allowed for a complete write-off of investment created an obligation to supply uranium as long as it was needed or wanted.3 Bennett began to worry about keeping Canada's export commitments unfettered. Early in 1955, when the u.s. sought to amend the Atomic Energy Act to permit co-operation in atomic matters with other countries, through bilateral agreements, Bennett noted that the amendments provided that, as a condition of such bilateral agreements, the export of uranium would be restricted to the United States or the United Kingdom, the old trilateral arrangement, or to a future International Atomic Energy Agency, as envisaged in Eisenhower's Atoms for Peace speech. Bennett took the opportunity to remind Lewis Strauss that the control of uranium was rapidly becoming a commercial rather than a military question. Canada must be free to dispose of nuclear fuels on a commercial basis, as and when they were permitted and required. Naturally the United States could assume that Canada, as a good ally, would not ship atomic materials to unfriendly countries. The Americans conceded the point. Uranium moved one more step from the military realm and towards that of trade.4

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Bennett continued to press Johnson for a concrete statement of what the USAEC wanted. The Americans were asking the Canadians to offer them, before anyone else, any and all uranium produced. Bennett preferred to have an agreement that specified, in writing, a realistic figure for American procurement, with a ceiling price. Johnson asked for a 'realistic' estimate of what Canada could produce. Told that it was 18,000 tons between 1955 and 1962, he promised to buy that amount with a ceiling price of $12 a pound. (The highest price under the special price contracts turned out to be $10.85,to Bicroft.) On 8 June 1955 Bennett accepted Johnson's proposition.5 That solved the immediate problem, but it did little to abate longer-term concerns about the effects of the onrushing uranium boom. So flush was the uranium market that it was automatically assumed that the American demand for uranium would go on forever, or, if not forever, then at any rate well past the 1962 deadline. When the USAEC announced that it would buy domestic uranium until 1966, that clinched it. Of course the United States would go on buying. Every previous purchase offer had been duplicated in Canada, so why not this one? Bennett's muted warning of January 1955, therefore, fell on deaf ears. As he explained to Strauss, the fact that nothing was being said about the 1962 cut-off, on an official level, was being 'construed as consent to the prevailing opinion that the military market will continue beyond March 3ist, 1962.' June 1955 was almost a month of miracles in the uranium business. Bennett had suggested an 18,000-ton limit in May, and confirmed it at the beginning of June. Now, three weeks later, he wrote to Strauss to tell him that production estimates had skyrocketed. Canada could deliver not 18,000, but 47,000 tons in addition to Eldorado's own estimated production of 10,000 tons. The increase posed no problem for the USAEC but it was of concern to Bennett. He felt strongly that the time had come to place a limit on the tonnage Eldorado was prepared to buy and that this limit should be announced. This concern was shared by Howe.6 Through John Deutsch, one of its assistant deputy ministers, who also happened to be a close personal friend of Bennett's, the Department of Finance was kept informed of Eldorado's increas-

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ing financial commitments. Deutsch and Bennett agreed that the time had come to bring the cabinet into the picture and that this could best be done by setting up a special committee of the cabinet for atomic affairs. 'I put the matter before Howe,' Bennett stated much later, 'and my distinct recollection is that he was not too enthusiastic.' Typically, Howe was worried about meddlesome bureaucrats poking around in 'his' empire, but finally he agreed. It would be dealt with by a committee of cabinet, and a very high-level one at that. The Uranium Committee of the cabinet would be chaired by the prime minister, Louis St-Laurent; its other members included Howe himself, Walter Harris, the minister of Finance, and Lester Pearson, the External Affairs minister, whose constituency included Blind River and the new uranium boom town of Elliot Lake. A subcommittee of senior officials assisted the ministers. Bennett and Bateman took a leading role as they had been doing for the previous ten years; joining them were Jules Leger, Pearson's deputy minister, and R.B. Bryce of the Privy Council office, as well as John Deutsch from Finance. Leger reported to Pearson that he had learned from Bennett that Howe 'was concerned over the possibility that the u.s. Atomic Energy Commission might, without warning, cancel contracts in which case the Canadian Government would be seriously involved.' Perhaps, Bennett quoted Howe as musing, the Canadian government should withdraw from the field altogether and 'allow the us Atomic Energy Commission to negotiate directly with Canadian producers.' This would have been a considerable departure from the policy Bennett had established, with Howe's approval, over the previous couple of years. Howe was given to off-the-cuff remarks which, because he was a powerful minister, had to be taken seriously. He usually thought better of them. It was a relief to the official subcommitte that there was no sequel to this particular thought. The civil servants tended to think that the government's existing uranium policy was working out well enough. If private Canadian companies were left to make their own terms with the Americans, it was always possible that the USAEC would impose a system of options to purchase that would effectively control future Canadian production, something that 'would make it difficult for the

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Canadian Government to arrange for exports to other countries if this should be deemed desirable.' The most obvious way to bring order into the existing speculative situation was to make a public announcement of the pricing formula and current production figures, so as to allow investors 'to make an intelligent appraisal of the risks they were undertaking in developing new mines.'7 This advice went forward to the cabinet committee, which met on 22 July 1955. The committee had before it a memorandum from Bennett reviewing the history of Canadian uranium policy since 1942 and discussing the policies in force since then. Bennett thought two alternative courses of action should be considered. First, it might be possible to discontinue all purchases under the special price formula. This option, which was clearly the one that Howe had been voicing earlier, would leave domestic producers free to make whatever arrangements they could for the sale of their ore. Bennett did not think much of that policy, which to his mind mortgaged too much of a lucrative national resource to the vagaries of a foreign-directed market, or rather, a market controlled and directed by a foreign government. It would be better to continue with the status quo, accept purchase guarantees by Eldorado in the order of a billion dollars, and trust 'in the good faith of the us Government. Assuming we are satisfied on this score,' Bennett continued, 'the arguments are strongly in favour' of continuing existing arrangements, but with one substantial difference. The difference was to make an announcement of a cut-off date of the kind Bennett had proposed in his earlier letter to Lewis Strauss. The effect would be to limit the exploration, development, and promotion of new Canadian uranium properties. Bennett, who presented his case in person, prevailed. The government would keep its hand in the uranium industry and would not withdraw from control of the uranium market. Bennett was instructed to enquire 'how much uranium the us is willing to contract for under the special price formula. When this amount is determined, an announcement should be made of the amount, and contracts will be signed on the basis of first-come-first-serve up to the stated amount.' In the immediate future, before the u.s. could respond, Bennett was authorized to sign contracts with Stephen Roman's

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Consolidated Denison and with Bicroft for 24 million pounds of U3O8, valued at $238 million.8 The Americans got what they wanted — almost. They asked for a price ceiling, $10.50 a pound of contained U3O8. They agreed to a deadline for the signature of contracts, i April 1956, and they agreed that all such contracts would stipulate a start-up date no later than i April 1957. The special price formula would of course apply, and each producer was to give the USAEC an option to purchase its post-1962 production. However, the USAEC did not want to announce publicly a tonnage limitation; as Howe told the House of Commons, they were sensitive on that score because of the 'end-use' of the uranium. Howe's announcement, which he made in July, stressed the fact that Eldorado had no obligation to make special price purchases, but that it was doing so under an agreement with the USAEC. The minister then repeated the salient points of Eldorado's agreement with the USAEC, repeating for good measure Bennett's warning that there was 'no information' on the continuation of military demand after 1962.9 This announcement marked a turning point in the uranium boom. A limit had been set, a line had been drawn, as Bennett had wished. The USAEC went along with his wishes, but it hedged its bets by placing options on all post-1962 production. By doing so, it made the turning point less apparent to the uranium companies involved, and created an illusion of security for the future. Why did the USAEC go out of its way to create this illusion? Why was it reluctant to confront the increasingly apparent reality of a uranium glut, and to draw conclusions from the rapid development of a domestic American uranium industry? A variety of factors were at work. In the first place, though the Cold War was thawing slightly, there was no inclination to trust the Russians more than was absolutely necessary. A strong defence relying on nuclear deterrence was accepted policy, and if that were so, who could tell the military what was enough for nuclear defence? Moreover, though u.s. domestic production was rising spectacularly, American ore reserves were not. A continuing dependence on foreign supply was indicated. Finally, the Canadian discoveries were almost too good to be true. T was surprised that the Blind River

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formula worked as well as it did.'Jesse Johnson wryly admitted. 'So much was uncertain there, especially as compared to Gunnar.' Probable or not, Blind River was a roaring success. Blind River, Bancroft, and Beaverlodge would go on producing until the ore ran out — or until someone told them to stop.10 II

Bennett's deadlines lasted for about eight months. So did his estimated ore deliveries, which rose from 58,220 tons in July 1955 to 78,015 tons by November of the same year. (The final figure would be around 70,000 tons.) Not all companies could get funds easily or promptly — Canada was going through a period of tight money and investment funds were scarce — and interest rates rose. Miners and engineers were in short supply and the immigration department had to send special recruiters to Europe to round up experienced underground men. Steel was also hard to find, because of a steel strike in the United States in the summer of 1956. Prices of mining equipment rose as mining companies elbowed one another away from the trough.11 At least one Canadian producer, Viola MacMillan of Lake Cinch mines, took her troubles directly to Washington. She had to have an extension, she told the USAEC, and the USAEC listened. Soon afterward Bateman was told that 'this time limit of April i, 1957 could be relaxed as far as they were concerned.' This, Bennett told the senior officials committee, 'was a different attitude than the one we had found during this spring and summer.' If exceptions were going to be made, then fairness dictated that they should be made for all. Eldorado and the USAEC eventually agreed on the new terms to offer, and on 2 March 1956 Howe informed the House. The new deadline for starting production had been moved from April to September 1957, he said, doubtless hoping that this announcement would be the last. It wasn't.12 It became necessary to extend production deadlines when it became evident that a mining company would not get five years of full production if the original deadline was maintained. It may seem strange that this was a matter of great importance, since the quantities they were to produce had only become available, in a

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notional way, very recently. But the USAEC seems to have incorporated the rising Canadian estimates so quickly into its production schedule that by the middle of 1956 it had become quite inflexible in desiring a minimum delivery of between 68,000 and 71,000 tons of oxide from Canada over the duration of the special price contracts. This stimulated a new order of difficulty for Eldorado, not to mention the private companies. Eldorado proceeded by first issuing letters of intent to mining companies. Without a letter of intent, which legally has the force of a contract, an applicant could not hope to get 'the millions needed to develop the ore body.' The decision to issue a letter of intent was no guarantee that an ore body, economically viable, could be developed. But with the Americans demanding a firm 68,000—71,000 tons, Eldorado's choices suddenly became very important. 'The difference between 68,000 and 71,000 tons,' Dick Barrett wrote, 'a matter of 3,000 tons, or only 4%, allowed for very little error.'13 The situation, already delicate, became confused when, in the mid-fifties, another actor entered the scene. The British had been moving fast to close the gap between themselves and the USAEC. They had already exploded an atomic bomb in 1952. In 1954, on Anderson's recommendation, an independent Atomic Energy Authority was constituted; its first chairman, Sir Edwin Plowden, had large ambitions for his authority, and a considerable faith in the potentialities of British nuclear technology. Plowden and Bennett met in Washington in October 1954, when the British were trying one more time to interest the Americans in a freer exchange of information. They failed, to no one's very great surprise. The Canadians, as usual, were interested spectators at the ritual, as they waited for the more concrete topics under discussion to reach the top of the agenda. Getting no joy from the Americans, Plowden next turned to Canada, and to Bennett. Casually, he asked Bennett how uranium production was going. Bennett's response may have been surprising and must have been encouraging. From being a small producer, Canada was on the way to becoming a very large one. Plowden stored this information away.14 It resurfaced less than two months later, and in a roundabout way. Joe Hirshhorn controlled a number of properties in the Blind

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River area. Hirshhorn had been able to finance the first of these, the Pronto, which was the first mine to come into production in the Blind River area. His next mine, the Algom, was a much larger project and because of that, he had to look outside his own resources for its financing. He met Bennett in Ottawa and inquired whether there would be any objection to his taking in a foreign partner. Bennett replied that this would depend on the nationality of the partner. Hirshhorn then told Bennett that the partner would be Rio Tinto, a company based in the United Kingdom, whereupon Bennett stated that there would be no objections to the proposed partnership. The next step was described in a cable from Plowden to Bennett at the end of November 1954.The Rio Tinto mining conglomerate, headquartered in London, had been in to see him. 'They have informed us,' Plowden wrote, 'that there is a possibility of their taking an interest in the company who control the uranium deposits at Algom.' Rio Tinto had not told Plowden this simply for the pleasure of keeping him informed. Britain was still labouring under a system of strict exchange control, and money of the kind that Algom needed could not be found without the approval of the British Treasury. One route to the Treasury's approval was through Plowden, but better yet, from Rio Tinto's standpoint, was the possibility of actually getting money from the Treasury, on Plowden's say-so, for the purpose of securing uranium for Britain, on Rio Tinto's account. Plowden responded cautiously. Yes, he was 'interested in obtaining supplies of uranium from Canada.' No, he could not do it without consulting the Canadian government Eldorado - first. This he did, at the same time asking Bennett to clarify the possibility of getting uranium from Canada before 1962.15 Bennett had two responses. He discouraged any official or public participation by the British government in investing in Canada, citing the precedents already established with the Americans, although he had, in principle, no objection to Rio Tinto investing in Pronto. As for the possibility of getting uranium before 1962, that was up to the Americans, who had been promised all the uranium Canada could produce in that period. The signals Bennett was getting from the American capital were mixed, and he still found it

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hard to credit that the military contracts would expire entirely seven years down the road. He had, nevertheless, to concede the possibility. The recent meetings in Washington seemed to Bennett to offer a means of solving the problem. There it had been agreed that the CDA would begin to allocate uranium for civilian purposes. 'While Canadian production is not now subject to allocation by the CDA,' Bennett wrote, T would have no objection to including Canadian production in the CDA pool for the purposes of determining allocations for civilian programmes. In fact,' he added, 'I see some advantage in such a step from our standpoint, having in mind that we are most anxious to develop an export market in the U.K.'16 This was encouraging, within certain well-defined limits. Plowden thought he spotted an opportunity, and promptly despatched the AEA'S procurement officer, John Clarke, to spend Christmas in North America. Clarke was not too pleased at the prospect, and was even less so when he got to Ottawa. His mission was vague: Plowden expected him to get Canadian uranium, but had not suggested how. Bennett could tell him little more than he had already told Plowden, that Canadian production was still promised to the United States. Clarke later laughingly recounted that he had 'crawled on bended knee all around the room trying to get Bill Bennett to sell us some uranium.' But Bennett had none to sell. Clarke then moved on to Washington, where Jesse Johnson was as non-committal to the British as he was to the Canadians. He would keep the British in mind. The British, however, had a different timetable. Negotiations proceeded with the Australians and the South Africans through the CDA, and their production seems to have sufficed for the moment.17 Plowden did not give up. Perhaps a change of personalities would be salutary. He sent over William (Bill) Strath, appointed in October 1955 to be AEA member for external relations and commercial policy. Strath had enormous presence and enthusiasm, and his relations with his Canadian counterparts were, on the personal level, highly successful. They were, for other reasons, successful on the business level, too. Plowden used every approach he could think of. St-Laurent and Howe were nudged by their British counterparts. St-Laurent responded by telling the British

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they were 'absolutely first on the list, in return for a promise that we'd never use the stuff for war. — the first time but not the last that such a restrictive condition would enter Canadian uranium sales.18 It did not seem logical to restrict British end-use of uranium. They were an original member of the nuclear club, the three inner-circle originators of the atomic bomb. Whatever St-Laurent may have thought of restricting the British to peaceful uses, no one else tried to tell the AEA what to do with its uranium. The rise in Canadian production made it possible to think of including the British in Eldorado's delivery schedule. In October 1955 Bennett formally proposed, at a tripartite meeting with the British and Americans, that the USAEC cut the British in on their deliveries. Lewis Strauss of the USAEC was non-committal, but promised to give an answer before the end of March 1956. When the answer did not come, Bennett reminded the Americans of their promise. Suddenly, the whole issue became unblocked. The Canadians were told that indeed the British could take some uranium - 2500 tons. The arrangement would be confirmed at a meeting of the CDA in Washington in May. At the CDA, the Americans were even more forthcoming. When the British representatives suggested that 2500 tons be increased to 5500, the Americans agreed. They asked only that Eldorado guarantee to deliver to them not less than 68,000 and not more than 71,000 tons before the end of March ig62.19 It remained only to allocate the 5500 tons among deserving Canadian producers. Rio Tinto, which would have liked to be the preferred supplier to the British, did not get any of the tonnage. All arrangements were complete by the end of August 1956, and the AEA duly became Eldorado's second customer. It was the firs time since 1952 that Eldorado had sold any significant quantity of uranium to anyone but the United States government.20 As the deadlines for Canadian production varied during 1956, so did the quantities and delivery dates assigned to the United Kingdom. The commitment to the United States, and the contract with the United Kingdom could be fulfilled, so the Ore Procurement Division concluded, but only provided all companies in receipt of letters of intent from Eldorado (all but one were signed by the end of July 1956) managed to get under way. Therefore, in

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Barrett's words, 'the financing of these mines became absolutely essential.' To get financing, the companies needed more sales, and a longer delivery period. The USAEC and the AEA pitched in and offered to purchase a further 12.5 million pounds of U3O8, of which the British were assigned 10,000,000 pounds, or 5 tons. This became the second British contract. The deadline was 31 March 1Q63-21 As of the end of 1956, therefore, the United Kingdom was committed to the purchase of 10,500 tons of Canadian uranium before the end of March 1963.But, as Bennett learned, the British wanted even more. The Suez incident of November 1956 highlighted the vulnerability of western European economies to interruptions of Middle East oil supply. When the British and French briefly invaded Egypt, Middle Eastern countries retaliated by cutting their pipelines. It was a stringent reminder that oil supply for Britain was no longer under firm control, and it encouraged the British to look elsewhere. They looked to atomic energy, and they looked to Canada. In the fall of 1956, Bennett learned that the British were interested in buying 3000 tons a year of uranium from Canada. This news came just as more uranium reserves were reported, and it seemed a propitious time to negotiate for a contract that would go beyond the 1962 or 1963 cut-off points. Since the price formula provided for the retirement of debt and the full depreciation of assets, the cost in the post-contract period would be substantially lower. This was reflected in the option provision of the contracts which specified a price of $8 per pound should the option be exercised. Bennett would have preferred to merge the new British request into one big contract which would include existing commitments, but extraneous circumstances made that impossible. When Bennett used the British request to pressure the USAEC regarding its intentions on its post-1962 options, the USAEC replied that it could not possibly make up its mind on that until it had clear direction from the military. The subject was under study but there was no indication when the u.s. Defense Department would reach a conclusion.22 The United States for the moment stood by the options in its existing contracts, to continue purchases after 1962. As Bennett

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explained to Howe in March 1957, that need not make a great deal of difference in dealing with the British. The British wanted 15,000 tons — 3000 a year — between 1962 and 1967. 'The further development of ore reserves, particularly in the Blind River area, which has occurred in recent months, indicates clearly that Canadian production could be increased by the amount necessary to meet the UKAEA requirement after 1962 even if the USAEC decides against the proposed diversion,' Bennett wrote. 'This increase could be obtained by expanding the production capacity of some of the existing mines.'23 In the meantime, Anglo-Canadian uranium harmony was celebrated at a conference in Bermuda at the end of March. Prime ministers Louis St-Laurent and Harold Macmillan, accompanied by several of their ministers, announced the completion of the second British contract, specifying deliveries over the next five years for a total of $115 million.This harmonious spectacle was quickly followed by an exchange of letters between Bennett and Plowden clarifying the details of what was to be the third British contract. Bennett originally envisaged a contract for 30 million pounds (15,000 tons) of oxide. That figure became redundant when the second contract, for 5000 tons, was agreed to. Plowden applied the 5000 tons to Bennett's 15,000, came up with 10,000, and added 2000. The final quantity the British were asking for would be 12,000 tons. Plowden's attitude seemed agreeable, but because of a certain vagueness of phrasing in the AEA chairman's letter, Bennett thought it desirable to make the nature of the deal clear. 'You will note,' he wrote to Plowden on 14 May, 'that we are prepared to give you an undertaking to sell on the understanding that you give us an undertaking to purchase. This was intended to be a firm undertaking for both parties - and not an option on your part.' Plowden, in a letter of 27 May 1957, explicitly agreed with Bennett's definition of the Anglo-Canadian understanding.24 The negotiating stage of the three Anglo-Canadian uranium contracts was now concluded: 22,500 tons of uranium oxide would be delivered to the United Kingdom between 1957 and 1967. It was a very large sale, and a notable coup. Eldorado, though at very strong British insistence, had established what it hoped would be a

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lasting commercial link across the Atlantic. The third of the British contracts, it was assumed, would be directed to the British civil power program. This was another new departure and, Eldorado hoped, the first of many. But in another sense, the British contracts were the last of their kind. They were written with no strings attached. The British could do with the uranium as they pleased, and if it pleased them to use the stuff to make atomic bombs, then Canada would accept the fact as part of the price it paid for the general defence of the West. In the world of 1957, however, there was a less easy acceptance of the nuclear arms race, and a belief was growing that Canada ought to do nothing more to encourage it. This belief was associated with a growing sense of Canadian virtue in the face of a world where armaments were said to be running amok, but it had some practical considerations to its credit as well. The fact that nuclear technology was beginning to spread could not be disguised. The possibility of a world overrun with nuclear-tipped mini-states was becoming much less implausible. It was a reasonable end of diplomacy to seek to limit or abort that possibility, and the Canadian government was coming round to the point of view that its sales to the Americans and the British were becoming an anachronism — an honourable anachronism, but also, potentially, a dangerous one. It was a time of new initiatives. Ill

Eisenhower's Atoms for Peace speech had started the ball rolling. The technological marvels that the American president predicted in a nuclear-powered future had fired a certain enthusiasm around the world. At any rate, there was enough interest expressed to cause various countries to ask the Americans for details of their president's proposals. There were, unfortunately, none to be had. The one clear sign that remained was Eisenhower's suggestion of an International Atomic Energy Agency (IAEA), and to that sign Canadian diplomats pinned their hopes. The advisory panel, which for years had eked out a dismal half-life, sprang into action. It had recently admitted Bill Bennett to its membership and so had at least the possibility of

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learning what was going on. On 5 January 1954, the panel agreed that Canada should endorse the concept of an IAEA and accept an obligation to promote it. As for what shape the IAEA should take, the panel favoured the model of the International Monetary Fund (IMF). The fund, apart from its central office, had no substance, no operating capacity. It received contributions from its members, and it dispensed them as needed. The IAEA, accordingly, should not operate reactors or hold piles of uranium in stockpiles, but rather act as a clearing house for nuclear information and materials. Only George Bateman entered a demurral. In his view, an agency without any operating functions would be a sham. The very first concern of any IAEA should be to get its hands on a stock of uranium 'as soon as they are able to look after it.'25 The Canadians were anxious to discuss their thoughts with the Americans, only to discover that the Americans had not settled on what they wanted to discuss. Finally, in March 1954, the u.s. government agreed sufficiently among its several selves to place a proposal for an agency before the Soviet Union. They told the Canadians what they had in mind, and because it was not very different from the Canadian sketch, the panel could endorse it without undue delay. The panel did comment that the American proposal was rather grandiose and cumbersome, but it approved all the same.26 As the IAEA was assuming a certain shape, the other side of Atoms for Peace was moving forward too. On 19 April, Lewis Strauss, the USAEC chairman, announced an American decision to convene an international scientific conference on atomic energy. Strauss and Bennett had discussed this proposition before the announcement and subsequently Strauss tried the idea out on Plowden. 'We agreed with the idea,' Bennett subsequently wrote, 'although ... I had some concern about how a free exchange of information would be possible under the current us security regulations. More specifically, I thought there was a risk in holding the conference unless some of the wraps were taken off.' Strauss, however, believed that such a conference offered a golden opportunity to counter Soviet charges that the American atomic program was a warmongering scheme exclusively devoted to producing atomic warheads. So his proposal went forward.27

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A steering committee was formed, consisting of Isidore Rabi for the United States, Sir John Cockcroft for Britain, and W.B. Lewis of Atomic Energy of Canada; and it was then that Bennett learned that Strauss not only proposed to hold a conference but that he wished to place it under the auspices of the United Nations. Bennett believed that in that case the conference would have to be held outside the United States, but that removing it from tripartite direction would ensure that Strauss's purposes would be submerged if not altogether forgotten. The Americans, however, wanted the publicity value of a United Nations announcement, and as before they had their way. The British, who also had misgivings, made a last attempt to revive the Combined Policy Committee instead, but they eventually fell into line.28 The conference, to be held in Geneva, was scheduled for the summer of 1955. A secretariat was established, the UN'S member countries were invited to submit papers, and a deadline was set for submissions to permit other countries to study and comment on the research to be discussed. As arrangements for the conference went ahead, the IAEA proposal hung fire. This was perhaps just as well, for as it turned out the Geneva conference would have a major impact on the potentialities of atomic power. Canada sent a well-furnished delegation to Geneva in August 1955. Bennett headed it, and supporting him were Lewis and a team from AECL, and Burger, Barrett, and Thunaes from Eldorado. Thunaes presented a paper on metallurgy, Barrett on uranium procurement, and Burger on the refinery. The British, too, fielded an impressive delegation, justifying their claim to be among the most advanced developers of atomic power. The Americans had planned to present a series of papers that would reconcile the claims of security with their boasts of technological virtuosity. They would, in any case, be certain to be ahead of the Russians. The Russians, however, were the surprise of the conference. They delayed until the last possible minute sending in their papers; when they did, it was discovered that they were more candid and more adventurous than the Americans. The Americans scrambled to recoup, with more information and new papers of their own, and the result was a very different conference from the one Strauss

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had envisaged. 'Much to the surprise of the Western scientists,' two historians have written, 'their Soviet counterparts were open and co-operative. They gossiped their secrets away on the ornate couches of the Palais des Nations and, after the close of each formal daily session, happily continued their conversations over dinner in Geneva's expensive restaurants.' The results of the conference, as far as the Canadian delegation was concerned, were twofold. First, atomic energy was considerably demystified, and to contribute to that process Canada, Britain, and the United States considerably expanded their declassification procedures. After what they had heard in Geneva, there was no point in maintaining secrecy over large areas of their atomic programs. Secondly, members of the Canadian and other delegations were vastly impressed by the advances that had been made towards making nuclear power economical. What had seemed to be at least a decade away now seemed much closer and, as a result of the publicity surrounding the conference, the governments of the world were much more inclined to treat atomic energy as a practical matter requiring infusions of money rather than as a research project to be kept on a shoe-string. Atoms for Peace had borne more fruit than Eisenhower could ever have anticipated.29 The apparent diffusion of atomic knowledge made the proposed IAEA in most respects a somewhat more routine proposition. Countries with any scientific base at all could begin to think of establishing their own atomic energy programs. They were assisted by bilateral agreements with the United States, and, as a result, they were perhaps less susceptible to direction from any international agency of the IAEA type. Where the IMF model had something that its less wealthy members wanted very much — money — it was becoming unclear just what the IAEA would be able to dispense in return for membership and an agreement to comply with its regulations, especially if those regulations restricted rather than enhanced a given country's atomic options. At Geneva, the Canadians concluded, 'it was made clear tht a number of countries have reactor programmes which will require significant quantities of natural or enriched uranium in the near future and, one way or another, intend to obtain what they need.' It would be an exaggeration to say that Canada was prepared for this develop-

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ment, although the Canadian government's lack of preparation was no greater than that of any other country. The trouble was that the need for nuclear supplies and information was revealed long before there was any agreed international system for coping with such an eventuality.30 That other countries would need uranium in some quantity before very long posed certain problems with Canada's existing commitments to the United States and the United Kingdom. Canadian uranium was bound up with the American nuclear weapons program. There was no disposition to withdraw from that obligation, and if the Americans chose to exercise their options, there is little doubt that Canada would have gone along with continued shipments. The Canadian government accepted the American nuclear umbrella, as embodied in the American nuclear deterrent, just as the Canadian government accepted other alliance obligations and strategies. Without having to discuss the question, the government also accepted that the Americans were unlikely to misuse their nuclear weapons — as indeed were the British, even though the Canadian government on specific points of policy differed with either or both of its senior atomic partners. Yet how many other countries was Canada prepared to trust? Bennett, Leger, Bryce, and Deutsch reviewed the situation at year's end. As the government's most senior advisers on atomic policy, they had to anticipate likely problems in atomic sales or exchanges, problems which might well have an impact on larger questions of Canada's relations with one state or another. They hoped that 'a system of controls' could be established, something they termed 'most desirable'; at the same time, the civil servants anticipated 'serious difficulties' on the way. 'The two most important of these,' they minuted, 'are first, that it would necessitate the acceptance of a "double standard" since it would apply effectively to all nations not now possessing weapons manufacturing facilities.' The second difficulty was getting all uranium-producing countries to agree to a single program of safeguards, whether they embodied a double or single standard. Naturally the Canadians hoped that uranium producers would agree to respect such standards as might be set by any future International Atomic Energy Agency, but they had no good reason to expect that this would be so.31

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Canada was, in the mid-fifties, closely associated in other ways with two would-be nuclear powers. France was an ally in NATO, as well as a scientific contributor to the success of the long-ago Montreal laboratories. French atomic science was well advanced and had deliberately been shaped in the direction of a weapons capability. It was true that French governments had not agreed to build a bomb, formally speaking, but by 1955 their Commissariat a 1'Energie Atomique (CEA) had created the nucleus of a bomb project. With or without the approval of the ephemeral governments of the French Republic, France was going to have a bomb, though the bomb itself would not be exploded until 1960. Because of an expansion in the French atomic program in 1955, it made sense for the CEA to look around for possible sources of uranium, and one of these sources would be Canada. India, Canada's other proto-nuclear associate, was a partner in the British Commonwealth of Nations. Prime Minister St-Laurent and External Affairs Minister Pearson attached the highest importance to Canadian-Indian relations, viewing India as a necessary bridge between what would now be called the First World of Western industrial democracies and the Third World of developing and impoverished states. India had some considerable scientific capacity, and an inestimable scientific treasure in the person of the physicist, Homi Bhabha, whose eminence was recognized by his selection to preside at the Geneva conference of 1955. Bhabha took a straightforward view of attempts to impose safeguards on nuclear weapons: in so far as they perpetuated the nuclear monopoly of the developed nations they constituted a most offensive form of hypocrisy. Thus India, in spite of a constantly repeated public refrain of peaceable oratory, was nevertheless not committed to avoid the development of nuclear weapons.32 This attitude was of some importance because Canada sought to develop scientific co-operation with the Indians using nuclear technology. Such technology would be of enormous benefit to an impoverished, people-rich, and resource-poor country, and it seemed altogether suitable that an atomic reactor program should serve as one of the bridges that St-Laurent and Pearson envisioned, connecting East and West. In 1955 it was agreed that Canada would, as part of its aid under the Colombo Plan, help India build a

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research reactor outside Bombay. It had also not gone unnoticed that other nuclear powers, such as the United Kingdom, might be interested in peddling their own nuclear technology, and thus it might be hoped that Canadian aid would at the very least derail someone else's trade, in the interest of a longer-term benefit to Canada itself.33 The Indian conundrum was inextricably intertwined with the development of a final Canadian position on an International Atomic Energy Agency, and therefore on safeguards. Chronologically, Canadian nuclear contacts with India antedated the IAEA, and in a sense they may be said to be subject to a kind of atomic grandfather clause. Canadian officials, contemplating the prospective atomic relations with India, attempted to weigh the desirability of applying universal standards against the desirability of appeasing the Indians. There was no hope of avoiding the issue by assigning control over uranium exports to the future IAEA, when and if the latter was created. There were too many uranium producers, and their product was too important for the individual countries who exported it.34 Though aware of the possibility, indeed the probability, that India would reject safeguards, Canadian ministers, Pearson especially, persevered. India entered a kind of transitional zone. It could not build a nuclear device immediately or for some considerable time; it had a peace-loving government; it was politically important. It would therefore be trusted not to sign an agreement on safeguards, on grounds that resembled the confidence placed in Britain and the United States. It was not stressed that those two countries had at least some relevance to Canadian defence, and that their deterrents played a very large role in the working out of Canada's overall defence posture. India, except in the most general sense, had nothing to do with the defence of Canada. It got its nuclear technology regardless. Uranium was not a major consideration in working out Canadian nuclear donations to India. The Indian nuclear reactors would consume relatively small quantities of the stuff and from Eldorado's point of view — though not that of other Canadian nuclear agencies - it was the principle, rather than the immediate practice, that counted. The principle was that Canada had three

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uranium export policies, as the year 1956 dawned. The first was for the United States and the United Kingdom: unfettered exports, which certainly in the case of the United States and probably in the case of Great Britain went straight into nuclear weapons. Next there was a policy for India, which was assumed not to be making nuclear weapons but which could not, out of politeness, be asked to stop. Finally, there was a policy for everyone else. The policy for everyone else was a policy of asking for a promise that uranium sold by Canada would not be used for the purpose of making nuclear weapons. This policy was embodied in the statute constituting the International Atomic Agency when that organ was finally set up by a United Nations conference in New York in 1956. France and India, it is true, objected strenuously, and in public, to a policy that created two classes of states: those with nuclear weapons, and those without. The IAEA was constituted nevertheless, and in 1957 it opened its offices in Vienna, under an American director-general. From the first, the IAEA was a disappointment to its founders. It was crippled at birth by the failure to embody within it any substantive powers. To establish a division of safeguards took a major political battle between West and East, with the Indian delegation firmly supporting the Eastern, non-regulatory, side. A safeguard agreement was not even signed until 1960, and then only over fierce opposition from the Soviet Union, its satellites, and India and Egypt. The Indian attitude was a major disappointment to the Canadian delegations to the IAEA; the belief of the Canadian government that Commonwealth solidarity and peace-loving rhetoric would triumph over a narrower conception of Indian atomic self-interest was ill founded. As far as India was concerned, moralism, not morality, was the key to international conduct.35 The later history of Canada's relations with the IAEA does not concern us here. It is enough to underline that the principle of safeguards was subscribed to by the Canadian government, but that the principle was not reinforced by any kind of genuine international consensus. During the mid and late 19505, it was up to the Canadian government to impose its views on safeguards in bilateral treaties. For some countries, such as Japan, this did not imply any great hardship. For other countries, however, the contrast between Canadian treatment of Britain, the United States,

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and India, on the one hand, and themselves on the other, was extremely painful. The issue did not take long to surface, for even as Canada was negotiating in New York and Vienna on universal safeguards for nuclear exports, potential customers were beginning to nibble at the Canadian stockpile. One was France. IV

There was something oddly reminiscent about Eldorado's French connection. Marcel Pochon had founded Eldorado's refinery on the technology developed in the Curies' laboratories in Paris. Boris Pregel had based himself in Paris during his long service for the Union Miniere, and in 1942 had secured a job at Eldorado for Bertrand Goldschmidt for the few months that the latter was between employments. Goldschmidt was well liked and well regarded as a member of the Montreal project from 1942 to 1945, so much so that General Groves made him an exception to his mistrust of the French, suggesting that Goldschmidt stay on in North America and forget about returning to France. Goldschmidt, however, refused, and returned to France at the beginning of 1946. French atomic energy passed through some troubled times in the late 19408 and early 19505. But when the smoke had cleared in the early 19505, Goldschmidt found himself strategically located as head of the Commissariat a 1'Energie Atomique's foreign service. It was in some respects a fortunate choice. International atomic energy in the decade after World War n was still dominated by the three Anglo-Saxon atomic powers and their little atomic 'club.' Like other Frenchmen, Goldschmidt was sensitive to France's exclusion from this privileged circle; unlike some others, he did not allow the circumstance to poison his attitude to the Anglo-Saxons and their peculiar ways. He did, nevertheless, resent the double standard that the three Western atomic powers erected against the rest of the world, and it was known that France was not likely to support restrictions on the end-use of nuclear materials supplied by any other country, such as Canada. Canada was, however, concerned about its post-1962 uranium markets and no reasonable request for uranium was allowed to pass without being examined. So it was that when Bennett and Goldschmidt met at Geneva in

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1955 and Goldschmidt inquired after Canada's uranium supplies, Bennett did not discourage him. Bennett had more than uranium in mind, as he afterwards testified. 'We were interested in establishing a close relationship with the French in the reactor research and development area,' he wrote, 'and this would explain why I did not turn a completely deaf ear to his request for uranium supplies. I say completely,' he added, 'since I was certainly aware that it was highly unlikely that the French would agree to effective safeguards.' The CEA wanted 1000 tons of Canadian uranium, to be purchased over three years, 1958, 1959, and 1960. That posed problems. The British were already bidding with their 55oo-ton order, and it had taken a great deal of time to bring the Americans around to sharing Canadian uranium with their junior partner. There was no great probability that the Americans would agree to move over again to satisfy a country that was not even a member of the atomic 'club' and whose bomb program they hoped to discourage. The French were strongly critical of the initial American plan for the IAEA - so strongly that the State Department let the French embassy know that Goldschmidt's speeches in New York were not appreciated.36 Bennett and Goldschmidt met next in February 1956. Again, optimism was expressed. Again, nothing much happened. In January 1957 the subject resurfaced, in conversations between Lome Gray, an AECL official, and Goldschmidt. Gray coolly told Goldschmidt that Canada had placed a soo-ton limit on uranium exports to countries other than the United States and the United Kingdom. This quantity would be released to virtually all comers in the interests of research, but Canada (and the United States, which otherwise controlled Canada's production) would not sell more. The West Germans, who had also been inquiring about uranium, were told exactly the same thing, so that there was no discrimination as between Canada's European allies. If there were to be a sale, Gray added, a visit of inspection would be attached, although he added that it would be sufficient to show the Canadian inspector 200 tons being used for peaceful purposes and he would be satisfied. Goldschmidt urged Canada, through Gray, to make haste, and repeated his plea in a letter to Bennett at the beginning of February, telling him that the lengthy delays in concluding an

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agreement with Canada had solidified the arguments of his opponents inside the CEA, who accused him of being 'a great optimist as far as French purchases of Canadian uranium were concerned.'37 Goldschmidt was a great optimist. It was not clear what uranium Canada had to sell, but it was abundantly evident that Canada would attach conditions that the French would find unpalatable, even if a Canadian inspection should prove symbolic. The French did manage to concoct an ingenious offer. They did not like safeguards. Uranium destined for purely peaceful purposes was clearly not as useful to them as unrestricted uranium. Since it was of less use, let them buy it at a discount -25% off the u.s. price. Such a discount, if accompanied by 'liberal' safeguards, would be acceptable. Goldschmidt presented this package to Bennett at a meeting later in February. As far as price was concerned, the two sides were not terribly far apart, since Bennett was prepared to offer a 19% discount on sales to France, but on safeguards there was, and presumably could be, no agreement. The negotiations therefore failed.38 It can be seen that there was never any serious hope, on the Canadian side, that the French could be signed on as Canada's first large-scale, post-military customer. France had much to offer Canada in reactor technology (it was in that area that Gray was meeting with Goldschmidt in 1957). French business would have been attractive to Eldorado after 1962. It was true that Canada had not consulted with France when it evolved its policy on nuclear exchanges, and true, too, that France was not as well treated as the United States or the United Kingdom. The French knew it, just as they knew that Canada's attitude was not confined to the question of atomic weaponry but applied across a broad spectrum of this country's external policy. It may not have been true that France was a blind spot in Canada's diplomacy, but it was certainly the case that Canada proceeded with no undue regard for French interests. For the moment, Eldorado suffered no loss through the French contretemps. The company had all the business that it could handle, even if the future remained gloomily vague. Against financial temptation, Canada had stuck to its announced policy on safeguards. Howe himself had made the announcement, coupling

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it with an offer to supply uranium in aoo-ton lots to countries that might desire it. What Canada proposed to apply to such sales was Article xu of the statute of the IAEA, negotiated in New York the previous fall. As Bennett gloomily wrote in April 1957, 'The response to the announcement has been most discouraging. While we have been approached by a number of governments regarding the possibility of obtaining small quantities of uranium, in every case except one these governments have stated that they are not prepared to accept the type of control provided in Article xu.'39 Another option had closed. Eldorado had not hoped to sell much uranium - at most a few thousand tons - but such sales might have paved the way to larger ones in the days ahead. It did not matter that the United States was applying exactly the same policy to its uranium exports. The Americans had a large domestic market, and it could be anticipated that u.s. domestic producers would be able to supply it for the indefinite future. Canadian producers, Bennett feared, would not be in the same happy position. V

At the beginning of 1957, Eldorado was faced with no urgent problems. With the development of the Verna ore body, it had become possible to raise the production target to 2000 tons per day and to expand the mill capacity accordingly. The company's balance sheet was healthy. The ore-procurement program was moving ahead as smoothly as it could. Most of the technical problems at the Beaverlodge mill had been resolved, and the refinery was enjoying a new lease on life, thanks to its recent renovation. An Eldorado press release in December 1956 drew attention to the most recent estimates of Canada's uranium ore reserves, 225 million tons, and to the 14,000 to 15,000 tons per annum that Canada expected to be exporting to the United States. By the time all the uranium producers started up, Eldorado told the world, more than $300,000,000 would have been spent in pre-production, in buildings, and services. Uranium would soon employ 12,000, and support a total payroll of $60 million a year.40 It was no mean boast, and it was all true, as far as it went. Yet, Eldorado's situation was not entirely satisfactory. The company

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had comparatively little in the way of orders after 1962. The International Atomic Energy Agency, which some had hoped would bring order to a future civilian market for nuclear materials, including uranium, was being castrated at birth. It would be just another ineffectual international agency, useful principally for exchanges of information and for the promulgation of rules that nobody was obliged to follow. Canada, which tacked the IAEA'S safeguards to its masthead, would not be able to benefit from those rules for many years. Canada was not wrong to negotiate and then impose safeguards. The danger of the proliferation of nuclear weapons is too great to permit any possible avenue of approach to the problem to go unregarded. Unfortunately, the capacity to build nuclear weapons cannot be dissociated from more general nuclear knowledge. The same technology that lights homes can be diverted, or perverted, into the construction of 'nuclear devices.' It was, therefore, not unreasonable to try to dissuade nations from experimenting with the explosive power of the atom. But it must also be admitted that such efforts have not borne much fruit. France, against which Canadian safeguards were applied in 1957, was not inhibited thereby in building its atomic bomb. The French had other supplies of uranium, and where mines did not exist, they developed them. All this was in the future. And the future would turn out to be very different from what Val Duncan, the chairman of Rio Tinto had in mind when he addressed his Canadian uranium shareholders in May 1957. It was a time of accomplishment, Duncan announced, rehearsing the familiar statistics of uranium's growing importance as a Canadian export. It was also a time of hope. The United States had recently announced a stockpiling program for uranium. It was a good sign, he continued, a sign that 'Canadian producers will shortly be put upon the same footing by the u.s. exercising its options on Canadian production up to 1966.' His interpretation was not entirely unreasonable. But it was not the only interpretation available. For what the United States was stockpiling it would not immediately need.41

12 Too Little, Too Soon

Canada's nationalized uranium industry had known no other minister than C.D. Howe. But did the minister know the industry? He had never visited a mine, dropped in on the Port Hope refinery, or called at head office. In the latter case he had no need to. Eldorado's executive suite was only a couple of blocks from the minister's own inelegant quarters in Temporary Building Number One on the cliffs overlooking the Ottawa River. Across the street a new and more imposing building was going up to house Trade and Commerce, Howe's principal department. It would be ready for occupancy early the next year, and Howe's staff were looking forward to the move. But it was in familiar surroundings that Bennett saw Howe one day in the fall of 1956. The minister received Eldorado's president with his usual cordiality. Bennett was, he told Howe, concerned for the company's future. It did not take exceptional prophetic powers to predict that the uranium industry would face a decline in its markets. American uranium stockpiles were growing, and although the British were signing on as Eldorado's second customer, it was altogether unlikely that they could replace the Americans. At the same time, the nuclear power industry, through growing, was too small to absorb the volumes of uranium that Canadian mines were now equipped to produce. The prospects for the Canadian uranium industry were not entirely wholesome, and there might not be much that Canada could do about it.

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The industry's problems were one thing but, in Bennett's view, Eldorado's future might be quite another. The company was doing well and its immediate prospects were good. It faced a basic problem, however. Its activities were confined to uranium mining. Unless the company was allowed to diversify into the production of other minerals, its future would be bleak when the market for uranium collapsed as Bennett predicted it would following the completion of deliveries on the USAEC contracts. In these circumstances, the company could not expect to hold its highly qualified personnel and the expertise they brought to the company's operations. Bennett felt strongly that the company should diversify its activities, but he was equally strong in the view that this was not likely to happen as long as the company was owned by the government, and for two reasons. First, he did not think a government company should be in the highly speculative business of mining, exploration, and development; and second, he anticipated that the mining industry would take strong objection to Eldorado becoming involved in the production of other metals. He therefore proposed to Howe that a plan should be worked out for moving the company back into the private sector. In substance, the plan would involve the sale of the company's shares to the public. Bennett's plan, which will be described in detail later, appealed to Howe. It was probably true that the government had no direct reason for staying in the mining and refining business. Northern Transportation, the shipping subsidiary, was another matter, and it might have to stay in the public fold, but the mine, the refinery, and even Eldorado Aviation might be sold. Of course the manner of disposal and the identity of the purchasers were matters of at least political concern, but there were ways to guarantee that Eldorado would not be bought by any large and doubtful syndicates and that the company would remain in Canadian hands. There was only one problem, Howe told Bennett. Timing. The St-Laurent government was well on in the fourth year of its mandate. Its legislative schedule was crowded, and precious parliamentary time had to be reserved for measures that would, the cabinet hoped, attract votes and tidy up crucial adminstrative details. The Eldorado plan should wait until after the election when there would be plenty of time for its implementation.

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The election was called for 10 June 1957. The Liberals had no qualms as they headed into the campaign. They had a popular leader, prime minister St-Laurent. Their legislative record was respectable and responsible, if a trifle unimaginative. The opposition had a well-established record of shooting itself in the foot and there was no particular reason to fear even the well-honed debating skills of the Progressive Conservative party's new leader, John Diefenbaker. Even the public opinion polls promised sunny electoral weather. The results were quite different. Though sustained by a narrow plurality of the electorate, the Liberal votes were badly distributed for picking up a plurality of seats. Diefenbaker and the Conservatives had the largest number of seats in the new House of Commons. C.D. Howe was defeated in his own riding of Port Arthur. On 22 June a new government was sworn in under Prime Minister Diefenbaker. The new minister of Trade and Commerce was Gordon Churchill, MP for Winnipeg South Centre, a wartime army officer, school principal, and lawyer. Eldorado's future would be in his hands - and Diefenbaker's. It was no easy task moving into C.D. Howe's office, and it was made no easier by a heavy agenda of trade questions that demanded speedy answers. It took time for Churchill to come to grips with Eldorado. He later remembered a schedule so overcrowded that crucial meetings took place as late as 10 at night, if no better time was available. It was well known that Churchill's relations with some of Howe's senior officials were glacial, and it was also well known that Bennett was Howe's first appointment after his arrival in Ottawa. Nobody's career was more closely linked with that of the vanished minister. In fact, Bennett's relations with Churchill proved to be polite and even cordial. The prime minister was well disposed. Diefenbaker had taken an interest in Eldorado when he had been a mere MP from northern Saskatchewan.The company had extended him its co-operation and hospitality, and he appreciated it. Churchill assured Bennett that he had his own confidence and support; he did not, however, assign a smoothly functioning organization like Eldorado a high priority on his agenda. The company's status as a

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crown corporation remained undisturbed. Years later Churchill could not recall the issue of denationalizing Eldorado even arising, and it seems reasonable to suppose that it never occupied a high priority with him. In Bennett's recollection the remaining months of 1957 were a frustrating time. He was unable to get any kind of decision or even opinion about the kind of future he had in mind for Eldorado. Diefenbaker was leading a minority government into a fall session of Parliament. It was, moreover, a government none of whose members had ever served in a cabinet before. They believed that they were reversing years of Liberal arrogance and laying the groundwork for a second and more decisive election. It was no time to worry about Eldorado. By January the government's electoral plans had matured, and so had Bennett's plans for his own future. He intended to resign, he told Churchill. He had an excellent job offer from the private sector and he felt that now was the time to make a move. Churchill was taken by surprise. He did not want Bennett to go, and neither did Diefenbaker. But if Bennett was determined to leave, could he postpone the date of his departure until April 1958? The government was planning on calling an election very soon, and it would appreciate Bennett delaying his resignation until afterwards. It was a reasonable request, and not much was lost by acquiescing. Bennett therefore retired in mid-May 1958. At Churchill's request he remained on the Eldorado board, another sign that his departure was peaceful and friendly. There was no question who should succeed Bennett. Roy Henry, vice-president, had five years of intimate experience of Eldorado operations. He had worked on sales and pricing policy; he had acted as temporary manager at Beaverlodge; he had a general knowledge of the company's other operations and budgeting; and he had the confidence of the board. It was true that some members of the board saw Henry as safe and unadventurous to a fault, but at least no disaster was to be anticipated.1 In anticipation of Bennett's retirement and Henry's advent, Eldorado reassigned certain senior officers. Bill Gilchrist, formerly manager at Beaverlodge, moved to Ottawa to become vice-president in charge of western

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operations. At the June annual meeting he became a director. To succeed Gilchrist, Hal Lake, his assistant manager at Beaverlodge, became manager. That was just the beginning. Gordon Churchill, Eldorado's principal shareholder as minister of Trade and Commerce, set a precedent by attending the annual meeting. There he had the ironic pleasure, as a long-standing Winnipeg Conservative, of nominating John MacAulay, Eldorado's most senior director and a close associate of C.D. Howe, to a new term of office. 'My disappearance from the political scene would not have disturbed [MacAulay]' Churchill later wrote. Churchill was formally signalling his interest and support. Informally, however, members of the board were uncertain that their concerns were being reflected in Churchill's crowded agenda, and in particular in his discussions with Prime Minister Diefenbaker.2 Apart from voting a dividend of $50 per share, totalling $3,525,000, the June board of directors' meeting was largely routine. Shortly afterward, Henry was taken ill, and on 6 July 1958 he died. Gilchrist, as sole vice-president, filled in and on 9 July was duly appointed president by the board. Henry had died too soon to have an impact on Eldorado as president. Greatly liked and trusted inside the company, his contribution was as a trouble-shooter and chief of staff under Bennett. From 1953 to 1958 much of the routine business of the company was his to handle, and the smoothness of operations owed much to Henry's capabilities. Gilchrist became Eldorado's third president in as many months. He had been a highly successful manager at Beaverlodge, but he was new to Ottawa. He had, nevertheless, to face some of the most critical problems that the company had ever had to contend with. It was true that to an outside eye some of the problems were not evident. Eldorado was making a good deal of money and had every prospect of making more. Its money-making potential depended on its contracts to supply the USAEC with refined uranium; as long as these lasted the company's stability was assured. But there were few, if any, of the company's senior personnel who believed that the Americans would renew their contracts by taking up their options on future production. The board shared the same gloomy conviction. It was Bennett's presentiment of impending trouble

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and present opportunity that had impelled him, in 1956, to suggest to Howe that it was time to take the government out of the uranium business. The opportunity, in July 1958, was still there, but time, in the Eldorado directors' opinion, was getting short. I

Eldorado's problems had a tendency to reinforce one another. There was, first, its position as a crown company, located inside a highly competitive industry unused to governmental participation, if no stranger to government encouragement or subsidies. It did not matter that Eldorado was in the business of making a profit by selling its uranium as long as anyone who wanted to could get a piece of the action, and as long as the American market was expanding no other company could claim to have lost business through Eldorado's sales. By July 1958 the American market was no longer expanding. The USAEC was reluctant to embark on new commitments, and it had been with difficulty that they had been held to their commitment to buy 68,000 tons. It was quite reasonable to suppose that the u.s. market was going to shrink, and the latest estimates of American purchases were extremely depressing. Back in 1955 it had been estimated that American nuclear power stations would start up slowly but expand rapidly between 1962 and 1964. By 1965, it was suggested, nuclear-generated electric power would be rising at the rate of 3000 megawatts a year. Three years later, there was a very different prediction. It was possible that nuclear-generated electricity would expand, by the mid-19605, at a maximum rate of just under 500 megawatts a year. World demand until at least 1963 would be far less than world supply of uranium, and it would be only the termination of the Canadian supply contracts that could reverse the surplus. The stockpile of uranium was going to rise to a peak, in 1962, of almost 40,000 tons (the figures are for all countries); by 1966, the last year for which a prediction was ventured, the stockpile would still be substantial.3 Demand was shrinking, if not vanishing altogether. The repercussions in Canada were not hard to imagine. The private mining

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companies would not wish to share the diminishing market with the government's own company. The first step the government would be asked to take in bailing out the private companies — though not the last - would be the dismantling of Eldorado. Thus, shrinking markets tended to make Eldorado a political liability. Eldorado had a number of options. The company could go out of business with the expiry of its American contracts, leaving the field — or what remained of it — to the private producers. The company could, on the other hand, become private itself, as Bennett and the board argued it should. It could then compete with the other private mining companies and, given Eldorado's technical expertise and its existing profitable position, it could probably do so successfully. It could also, if it wished, diversify its operations in order to limit its dependence on uranium. Again, this had been Bennett's wish. Such a strategy would be difficult, if not impossible, as long as Eldorado had to confront the organized hostility of the Canadian metal mining industry to government competition. Admittedly it was possible to contemplate adopting this last strategy while continuing to function as a crown company, but it was a risk. These considerations faced Eldorado's board when it met in Ottawa in July 1958. It was Gilchrist's first meeting as Eldorado's president, and in fact his appointment came after what was called 'the future status of the company' on the agenda. Eldorado had always been a commercial company. Yet circumstances endangered its status. Although the company could close down, the termination of its Beaverlodge operations would in all probability also spell the end of Uranium City, with all the private and public investment that had gone in there. As a commercial company, Eldorado was confined to uranium, 'unlike other mining companies which follow a policy of diversifying their interests.' This was a painful situation, particularly when Eldorado had ample money available for exploration and development. The fact that Eldorado did not have a large exploration and development program underlined to its senior employees that the company was not able to make provision for its future - and theirs. This fact, the minutes of 9 July pointed out, 'is already having a serious effect on the morale of the senior staff.' It could be anticipated that the staff would leave unless or until the

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company took steps to preserve itself in the anticipated uranium drought. What could be done? There was, it was noted, 'an excellent opportunity' to establish an exploration base at Port Radium. The mine there was still a going concern, and all the necessary facilities existed to base a geological team at the mine: transport, housing, communications, and supply. True, the life of the mine was limited, but the presence of a geological party even after it closed down would save at least some of the company's investment in its facilities. An exploration program was not only desirable, it was economical and efficient given the company's existing establishment and immediate plans. Turning from the question of 'why sell' to the equally important consideration of'how,' the board established that the company wa expected to generate about $80 million in cash (net of tax and capital expenditures) over the next five years. All or part of this amount could be taken by the government as a dividend should the company be sold. In such a sale, it was entirely likely that the government would wish to retain some parts of Eldorado's empire. The Northern Transportation Company, for example, performed a service for the entire Northwest Territories. It was undesirable that it leave the hands of the government under the circumstances. Research and development was 'performing a function for the uranium industry as a whole.' It could easily be handed over to Atomic Energy of Canada Limited whose research program it complemented. The administration of the private producers' contracts could also be handed over to another government agency. As for the refinery, which admittedly performed a service for the uranium industry as a whole, the board conceded that 'there might be reasons for retaining it as a Crown-owned company.' The board did not think these reasons sufficient ones, or so it seemed, but it was not up to the board to decide. Once it was decided to sell, the company might simply be put on the block and tenders invited from Canadian corporations or syndicates — for political reasons it would be unreasonable to admit foreign ownership in this case. This arrangement, in the board's view, would result in the sale of the company for less than it was worth, and the government might not be willing to face the

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Eldorado

resulting embarrassment. Alternatively, 'the company might be sold to the public.' A precedent existed in the sale of the Alberta Gas Trunk Line to the public, restricting sales to bona fide residents of Alberta or, in this case, Canada. Eldorado's capital stock would be increased from the existing 110,000 shares to a hypothetical 5 million. This stock could then be sold through the chartered banks or handled by a Canadian underwriting syndicate. The share price would be set by establishing the company's liquid value, less its working capital. The proceeds would be paid to the government, and the company would retain its assets plus its working capital. It was this latter arrangement that the board preferred, but it suggested an imaginative variant. Common shares could be offered to the public, but preferred shares could be issued to the Canada Council, the federal government's newly established cultural development agency. These preferred shares would take precedence in respect of earnings after the u.s. contracts expired in 1963.4 The directors took their concerns to the minister that same day, 9 July 1958. They thought the matter urgent; but their minister disagreed. Nothing happened, although the reasons for this remain unclear. Even though nothing was forthcoming from above, the company had its own internal agenda. For the sake of its future, and for the morale of its employees, Eldorado had to make provision for the post-contract period. When the executive committee met in September in Toronto, Gilchrist again raised the question of the company undertaking a general exploration program. Those present — James, Brown, Buffam, and Gilchrist — found themselves 'in general agreement' that 'if Eldorado is to continue in existence, it should carry out exploration for new properties.' Gilchrist had prudently consulted Churchill, and, he reported, 'had already obtained ... his verbal agreement to proceed with an exploration programme in the Northwest Territories.' The exploration would not concentrate on any single mineral, and would be conducted by plane.5 Buffam, as Eldorado's consulting geologist, undertook to work out an exploration program. Originally projected to cost $100,000 in its first year, exploration for 1959 was estimated at between $200,000 and $250,000. Churchill

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approved the program on 5 November, and the board followed his lead when it met at the beginning of December.6 It would appear that at the end of 1958 Eldorado had averted the dismal scenario predicted in the middle of the year. The company had been disappointed in establishing its saleability, but it had nevertheless persuaded its minister to authorize the investment of a sizeable amount of money in a long-term exploration program of a kind more apropriate to, or more typical of, a private mining company. The executive committee embodied the new direction by appointing Hal Lake, the Beaverlodge manager, vice-president in charge of mining and exploration. At the same time Jack Burger, the Port Hope manager, became vice-president in charge of refining.7 The most urgent worries expressed by the board had apparently been answered. The contradiction between private exploration programs and public ownership had been resolved, or so it seemed. But while the board had been unanimous in recommending the 'privatization' (to use the coinage of a later Conservative government) of Eldorado in July, it was not whole-hearted in approving the exploration program. R.T. Birks, in particular, remained sceptical, and from time to time reminded the board that in his view 'the programme should be abandoned since the Company would not be in a position to exploit a mine even if the exploration were successful.'8 The 1959 season was the first of a three-year cycle. Eleven geologists and technicians duly flew up to Port Radium, with their families, and in the course of the year surveyed the terrain east of Port Radium through a combination of aerial surveys, ground geophysics, geological reconnaissance mapping, staking of claims, and some diamond drilling. The cost had advanced considerably over the revised budget Buff am had projected in December 1958: exploration expenses all in accounted for $358,542.9 The relatively higher profile of exploration came at the opportune moment. As predicted, the USAEC had finally had to decide what it would want from Canada after its contracts expired. The news came in November 1959 that the Americans would not exercise their options. The existing contracts would be the last.

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In Elliot Lake and Uranium City, Canada's two largest uranium mining centres, there was shock. On Toronto's Bay Street and in the head offices of private uranium companies, there was confusion. 'I feel that it is discriminatory against Canada,' Robert Winters, a former Liberal cabinet minister and president of Rio Tinto of Canada Limited, told the press. 'I just didn't believe the Canadian government could let this happen to us.' Or to us, the Steelworkers' Union chimed in. What about workers' investments in homes, schools, and churches? Winters did not let matters rest there. He mobilized his former cabinet colleague, Lester Pearson, to raise a ruckus in the House of Commons. Elliot Lake, after all, was in Pearson's own constituency of Algoma East. Winters next telephoned Bill Bennett. The two men were not particularly close, but both were out of government and there should be no trouble getting the real story out of Bennett. Bennett, who was by now in private business in Montreal, was mildly surprised to get Winters's call. What could he be thinking of? Hadn't he been a member of the cabinet? There was, he told Winters, a world of difference between a guarantee and an option. An option involved a choice. The United States had been free to choose, and nobody had any right to be surprised. The signs had been there all along for even the most obtuse to read. It would be better if Rio Tinto waited to learn what the government had to offer it, better still if the uranium industry's professional optimists had stopped to listen to what Bennett, Roy Henry, and Dick Barrett had been saying for the last five years.10 With the announcement from Washington, the end of Eldorado's guaranteed market finally came into plain view. It seemed like the end of an era, but in fact the signs of change had been obvious for some considerable time. The first indication had been the opening of uranium claims to private mining companies on federal lands back in 1948. Although the federal government still claimed a paramount interest in uranium as a matter of national interest and importance, its case rested ultimately on national security. The war, and military procurement, justified Ottawa's ownership of a large and profitable mining company. Yet national security was not so important as to justify excluding private initiative from the industry, and Eldorado's position as Canada's

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sole government-owned mine therefore became a matter of some delicacy. Now the military contracts were gone, or soon to be gone. II

It remained to pick up the pieces and efforts to do so were well in hand. There were three sources of demand for Canadian uranium in 1959. There were the demands of civilian research in various countries: Japan, West Germany, Switzerland, Italy, among others. Their aggregate demand, however, was minuscule, and would remain so until at least 1966. There were the American contracts which, it will be recalled, were individual ones, firm by firm, between the companies and Eldorado, and between Eldorado and the USAEC. Finally, there were the British contracts for the supply of uranium both before and after 1963, of which the largest component, the i2,ooo-ton contract, was negotiated in the spring of 1957. The i2,ooo-ton contract would apply to the period between April 1963 and December 1966, precisely when, in the opinion of Eldorado's analysts, the Canadian uranium industry would need it most. It came as an unpleasant shock to discover, on the day after Bennett left office, that the British had had second thoughts. A British delegation announced, on 22 May 1958, that the British were cutting back their capital expenditures and reducing their projected uranium requirements. 'Canada's main problem,' Roy Henry had told the British, would be 'the period '62-'66'; unfortunately, as Bill Strath, the British representative, pointed out, that was 'also the period of U.K. embarrassment.'11 Tedious and sometimes painful negotiations followed before the British commitment was finally worked out. It is useful to bear in mind that the British commitment to buy 12,000 tons was legal and binding, but that it is a difficult matter to coerce a sovereign and friendly government to respect a commitment that it has come to regard as excessively expensive and indeed wasteful. As a 1961 memorandum to Gilchrist put it, the i2,ooo-ton commitment was 'of extreme importance to the Canadian uranium industry and the dependent communities.' The quantity must be maintained at all costs. 'Nevertheless,' the memorandum continued, 'the Canadian

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attitude should be one of co-operation with the British since in the long view, the British market will be of major importance to Canada.' It followed that Canada made adjustments both to its price and to the rate of delivery of uranium to the United Kingdom, with the effect of prolonging until 1970 (and in one case 1974) the shipment of uranium originally contracted in a distinctly earlier and more optimistic period. This stretch-out of British deliveries was the first to appear, but it was not the most important. What should be done with the American contracts was central to the survival of the Canadian uranium industry as it approached its time of maximum vulnerability. That the United States was unlikely to take up its options on Canadian production between 1962 and 1966 had been tacitly accepted in Eldorado's head office for some time. It is true that some voices, such as Gordon Dean's, sounded a more optimistic note, arguing that common sense and reciprocal obligation should encourage the USAEC to buy some, at least, of Canada's expected uranium surplus. The delays and hesitations of the USAEC also gave cause for hopes. As late as January 1959 that organization's acting chairman could only promise a future answer to Gilchrist's urgent demand for more information.12 The USAEC had troubles and problems enough of its own. Its chairman, Lewis Strauss, resigned to accept President Eisenhower's nomination to be secretary of Commerce, only to discover that his past attitudes and present performance did not commend him to the u.s. Senate, which rejected his candidacy. It was not until early 1959 that Eisenhower put in his place a permanent chairman for the USAEC, John McCone. Shortly afterwards, McCone received a visit from Gordon Churchill, Eldorado's responsible minister. Eldorado's problems, which in this case were the concern of the entire Canadian uranium industry, had not gone unnoticed at higher levels of authority in Ottawa. The cabinet Uranium Committee, with the ministers of External Affairs, Finance, and Trade and Commerce as members, met from time to time, and under it sat a committee of senior officials chaired by R.B. Bryce, secretary to the cabinet and Clerk of the Privy Council. Eldorado's previous experience had reversed the old adage that success has many parents; as we have seen, the company had, with Howe's

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support, kept its business to itself with a minimal necessity for consultation outside. The imminent peril faced by the Canadian uranium industry now multiplied the officials and agencies familiar with Eldorado's condition and prospects. The public noises from Washington had been uniformly discouraging. Jesse Johnson told a Denver audience early in 1957 that the requirements for the u.s. government's military and civil power programs had been satisfied. Congressional hearings in Washington in February 1958 called forth a procession of witnesses hostile to the 'premium' paid to foreign uranium producers, a 'premium' that ignored special bonuses and subsidies available only inside the United States, while urging the protection and perpetuation of the United States' own growing uranium mining industry. The bleating and breast-thumping of American mining interests, centred in the u.s. south-western states, need not raise eyebrows in Canada, for within a few years Canadian uranium producers would repeat some of the same arguments with some of the same political impact. American politicians were naturally sensitive to the possibility that a large and relatively recent industry, employing many of their constituents, might become an economic liability, to say the least. Some of the politicians affected sat on the Joint Committee on Atomic Energy of Congress, to which USAEC officials had to turn for funds. As an Eldorado memorandum on the situation put it, 'if the options are exercised, the u.s. Congress would have to approve the use of u.s. public funds to the extent of $912,000,000 to support a Canadian industry.' The logic of that observation spoke for itself. Equally telling was the phrase that followed: '... the production of which the Commission does not require and the continuance of which would mean added competition for their own producers.'13 If this was so, why did the USAEC continue to hesitate in the spring of 1959? The answer to that question is still not entirely clear, but it seems reasonable to ascribe the commission's delay to uncertainty within the American military establishment. 'Opinion in the high command in the United States,' an Eldorado position paper claimed in June 1959, 'is even now divided as to what is required after 1964 — it could be less, it could be more, for it must be remembered in connection with the military use that there are the elements of stockpiling and salvage.' Improvements in the

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technology of nuclear weapons in the 19505 had cut the requirement of uranium on a per-unit basis, and it was 'quite possible' that improvements in the near future to weapons design would cut the military demand for uranium 'drastically.'14 These considerations were doubtless rehearsed in Gordon Churchill's meeting with John McCone in mid-April 1959. It would seem that McCone did not give Churchill a definitive answer, but the impression registered could not have been encouraging. Within the next two months probability shaded imperceptibly into certainty. When Eldorado officials next met with their USAEC counterparts, in the middle of June, the question they faced was not whether the United States would fail to pick up its options, but how that fact was to be handled. Eldorado's interest was twofold. As a company it naturally looked to its own preservation, if at all possible, but as the government's agent it had also to safeguard the Canadian industry as a whole. As we have seen, the company perceived the possibility for contradiction between these two roles, and, as we have seen, the private producers were not insensitive to the issue either. In discussions with the Americans, Dick Barrett of Eldorado took note of the USAEC'S anxiety to extend its deliveries beyond 1963. That was eminently acceptable to the Canadian side, which had in mind the extension of Canadian deliveries until 1966 — through a period of anticipated uranium glut. The USAEC also had in mind the possibility of permitting the rearrangement of Canadian suppliers to allow the survival of the strongest and the absorption of the weaker units. This could be done by consolidating the several contracts and allowing the several companies to trade their supplies among themselves.15 Back in Ottawa, Gilchrist and Barrett worked up the major points of the American proposals, and these were duly transmitted to Churchill, to senior officials outside Eldorado, and ultimately to the various ministers concerned. Months of secret discussions and interchanges followed, first inside Eldorado and the Canadian government, then between the Canadians and Americans, and finally among the Canadians, Americans, and British, since the consolidation of the British contracts and their simplification to exclude the Americans was a key point in the Canadian

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government's preferred solution.16 The crucial consideration for the government and its officials was the survival of the Canadian uranium industry. Next, there was the preservation of the three communities — Elliot Lake, Uranium City, and Bancroft — most directly affected by a slow-down in production. The government also considered, and rejected, a demand by the Ontario government that no uranium contracts be transferred out of Ontario; and, with some misgivings, the government also agreed that the preservation of Uranium City meant that Eldorado had to be involved in the acquisition of contracts in that area. What emerged was described in retrospect by Barrett in a memorandum for George Hees, Churchill's successor as minister of Trade and Commerce, in April 1962. The Stretch-Out Plan announced on 6 November 1959 had as its object the prolongation of deliveries to both the United States and the United Kingdom, without increasing the amount of uranium to be delivered. As an incentive, the USAEC and the AEA agreed to make substantial interest-free cash advances to their suppliers, to assist them in liquidating their funded debts. Suppliers were encouraged to reduce their production rates, and required not to use any purchased contracts to increase the rate of supply under their existing ones. In other words, purchased contracts could be used only for extending the life of a mine or a company until the crisis of excess supply passed away.17 The stretch-out plan was, as Barrett put it, 'successful to the degree hoped for by its sponsors.' By 1962, four mining companies survived: Eldorado, which took over the quota of the shaky Lorado mines; Gunnar, which took over Rayrock and Canadian Dyno's quotas; Consolidated Denison, which amalgamated with Can-Met, which incidentally was the only company whose bonds were not redeemed at par or better as a result of the stretch-out offer; and Rio Tin to, which consolidated its existing holdings and then absorbed Stanleigh's quota. Some investors did well, indeed very well, by the deal. Rayrock, which had run out of ore, instead had something more precious than ore, a licence to mine and then sell the stuff. Its investors benefited far more from the stretch-out than they could have from a continuation of the contracts. It had been a notable negotiating triumph. As Gordon Churchill later wrote,

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'Full credit should go to Mr. Gilchrist whose ability in negotiating the settlement was deserving of the highest praise.'18 Naturally employment in the uranium industry declined. Uranium City lost half its population, Elliot Lake more than half. Houses were abandoned, businesses failed or closed up, and mortgages were foreclosed. There was considerable public vituperation, but the government endured the new situation. It also agreed that Eldorado should continue to form part of the uranium industry. Gilchrist was informed that the cabinet Uranium Committee regarded Eldorado as an important link in the industry, and that the cabinet had no intention of selling it. It was a mixed blessing. Eventually, to preserve the industry, the government began stockpiling uranium purchased from the remaining private companies. Eldorado, however, as a crown company, received a loan to keep it in business. It was certainly true that its position was different from those of its private competitors, but as Bennett, Gilchrist, and the board of directors had predicted, it was not better. Ill

After 1959, the hopes for the company's future — or at least the vision of that future held by its principal officers and most of its board - were bound up in the possibility of its sale and, pending a sale, in its ability to explore and then mine for other minerals besides uranium. Port Radium was the base for the company's first major exploration program in a decade. Since Eldorado wished to explore the territory in the central Arctic, Port Radium was a logical base, at least until the ore in the mine ran out. That, Buffam decided, would probably be at the end of the 1960 season, but until then it would be most efficient and economical to add the company's geological parties to the existing community. Like many such marriages, it made economic sense but its impact on Port Radium's collective psychology was not entirely what the company wished to achieve. Port Radium in the late 19405 and early 19505 was a preferred posting for rising young professionals. The social life was intense, and extremely active. The exploits of

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camp characters were legendary. The appearance of royalty in the person of Prince Philip in 1954 was an occasion to be treasured and polished over the next thirty years. Under Hal Lake's cool hand as manager and with Ted Spice, the mill superintendent, as the resident backyard inventor and social animator, Port Radium had a unique character that commended itself to its inhabitants. Tort Radium was a great place,' one of its staff geologists, Lisle Jory, recalled. And for recreation, besides the curling league, the baseball games between the 'Young Crocks' and the 'Old Crocks,' there was tennis at 2:00 am and Ted Spice's choir, trained by the master to sing a capella.19 But the spirit had gone out of the place by the late 19508. Jory, like other company geologists, took time out for graduate school. When he and his wife Sheila returned to Port Radium it was 1959, and he was part of the Exploration Division. 'There was a division,' Sheila remembered, 'between those who were staying - Exploration Division — and the rest.' As a young mother she could stay sane by closeting herself with her babies. But outside, the atmosphere was at best tense and at worst unbearable. Presiding over Port Radium in its last stages was Jock McNiven, a veteran mine manager and the first mayor of Yellowknife. McNiven was affectionately nicknamed McPhoo by his staff, who understood his tendency to blow off steam. McPhoo was a widower and his assistant, Charlie Nancarrow, was a bachelor. Neither man was any the worse for that, but it did mean that the traditional role of the manager's wife was left unfilled and that Port Radium's little society was proportionately unsettled. Every day workers in the mine confronted the fact that their job was one day shorter, and that there was no obvious future for them inside Eldorado. They gazed enviously at the secure geological staff, professionals with a future either inside or, if they chose, outside the company. As 1959 drew on into 1960, it became obvious that Port Radium had entered the last year of its life as a uranium mine. In December 1959 Buffam placed the date for closing down at the end of July 1960; the deadline was extended by a month. As far as Port Radium was concerned the closure was no secret, and it gave the 150-odd employees in the mine an open agenda against which to plot their futures. What they did not know was that events were

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conspiring to bring the geological party as well to an unexpected termination. In October 1960 Lisle and Sheila Jory left Port Radium to go south. Since they would soon be back, they left furniture and other belongings for their return on freeze-up in December. They flew out with some of the departing miners. Some of the miners, a few, were going to Beaverlodge; most were heading back to Edmonton or to whatever their point of departure had been when they were first hired by the company. The Jorys, however, never returned. On i December 1960, the Eldorado board of directors gathered in Toronto, where they heard Bill Gilchrist report on pending matters. As was customary, Buffam reported on geology and exploration during the past year, and outlined what he proposed for the year to come. Gilchrist next told the board what exploration would cost and then added a surprise. 'Contrary to earlier plans,' the president told the board, 'it was now considered advisable in the interests of economy to move the exploration division headquarters to Edmonton.'20 The Exploration Division wound up its files, packed them in wooden crates, and flew them out to Edmonton. The staff followed, leaving three caretakers at Port Radium. Behind them, Great Bear Lake was left just as it had been, the preserve of the local Indian tribes. It was not quite the end for Port Radium. Years later a silver mining company returned to Echo Bay. The mine was still there, and so were most of the Eldorado buildings, preserved by the dry climate. Freight now moved in and out by air alone in the summer and, in the winter, both by air and over an ice road carved through the wilderness south to Yellowknife. The mine was not quite alone in the region, either. Hunting and fishing camps for those who could afford them lurked around the corner. Contact Lake, a mining property from the thirties, reopened, and further out, in the Barren Lands, there was other mining activity. Port Radium did not, however, survive a dip in the price of silver, and in 1982 it closed again. IV

The closing of the Port Radium mine and the coincidental end of the American military contracts completed a period in the life of

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Eldorado. We have, in this book, covered two episodes in the company's history: its years as a radium speculator, and its years as a supplier for allied military forces. The periodization is neither easy nor automatic. Eldorado was a military supplier before it was publicly nationalized, in 1944, and it remained a commercial source of radium and subsequently of isotopes long afterwards. Though a crown company, Eldorado was instructed to act like a commercial enterprise and, if possible, to turn a profit. That it succeeded in making money helps to explain its survival. Its political godfather, C.D. Howe, assessed the viability of Eldorado by its ability to attract customers of the paying variety. Howe and the men around him were never completely at ease as the managers of the Canadian government's only mine. They justified their role and their policy in terms of national defence and national security, but at the same time recognized that a thoroughgoing policy of government ownership and management of Canada's uranium was beyond the capacity of any government that they wished to be associated with. It is possibly true that they could envisage a state-owned uranium industry of indeterminate size, but, if they had such a thing in their mind's eye, they did not like what they say. They saw the speculative nature of mining and the risk rewarded by profit as more appropriate to the experience and capacities of the existing mining industry. In this they were disappointed, because established Canadian mining firms regarded uranium as too risky to be worth even a very large profit. The resultant period of drought, between 1948 and 1953, left Eldorado as the unintentional, sole actor in Canada's nascent uranium industry. The lack of private initiative in the area precluded any serious clash between crown company and private enterprise. Even after private firms entered the field, the abundance of American enthusiasm expressed in an open-ended purchasing policy allowed Eldorado to use American money as a useful incentive in propelling Canada's would-be uranium tycoons in the direction of prompt and economical production. The great uranium boom of the mid-19508 accomplished all that the Canadian and American governments wanted, and then some. The American government was impelled by fears for its strategic security to build up an arsenal of nuclear weapons. It was encouraged to do so because it believed that uranium was scarce

432

Eldorado

and rival nuclear technology even scarcer. It was proved wrong in the latter case, but it took until 1955 or 1956 for the USAEC to accept that it had an adequate supply of uranium in hand. Canadian uranium was crucial to the solution of the American uranium shortage; paradoxically, from being a solution it moved to being a problem as shortage turned into surplus, and surplus into glut in less than three years between 1956 and 1959. The approaching disappearance of its American customer unsettled Eldorado. The company had begun in the mid-1950s to diversify its customers, but it was handicapped in a number of directions. Only one customer, Great Britain, qualified as an ally close enough to merit the unrestricted sale of uranium, that is, uranium that could be used for any purpose the customer chose. Another ally, France, was firmly told that its purpose of building an independent atomic force de frappe rendered it ineligible. Without guarantees of civilian use, there would be no uranium sale to France. India, a partner in the Commonwealth of Nations, was not an ally, but it was a target for Canadian diplomacy, economic and political. Despite misgivings, India got uranium and more besides. It took until June 1965 for the Canadian government to announce its policy that Canadian uranium was available only for peaceful use. This sequel to these diplomatic episodes is, of course, beyond the scope of this work. While the feasibility of nuclear power had been demonstrated by the late 19505, the design, engineering, and construction of large-scale nuclear power stations took much longer than originally anticipated. As a result, there was at least a ten-year gap between the completion of deliveries on the USAEC contracts and the building up of a substantial demand by the nuclear power industry. This bore heavily on the uranium industry as a whole. Poverty followed plenty. It created a special problem for Eldorado because, as a crown company, it had to contend with the political opposition of some of its mining entourage, who were determined that in a time of declining markets their public patron should not become their competitor. It was in this context that Eldorado's executives and board of directors became converts to 'privatizing' their company. They could only do so because the company had developed resources of

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its own that made it at least a viable competitor with private mining companies. In the company's view, to continue as a public enterprise meant accepting political risks and economic handicaps. Far from being the creature of privilege that its competitors depicted, Eldorado had simply the doubtful privilege of turning back its profits to the government instead of investing them in further development. Public ownership, the salvation of a bankrupt or uneconomic firm, had in the eyes of Eldorado's executives mortgaged the company's future. It is difficult to know what weight to give to intangible factors such as morale in the history of a company. Each locality, each division, each specialty, each rank and, especially each individual, would furnish a different answer. It is logical to assume, as Eldorado's officials did, that a company with a future in its area of specialty is more likely to stimulate good morale than one without such a prospect. Eldorado already drew heavily on the commitment and loyalty of its top-ranked employees, whose salaries lagged further behind private industry the higher one went in the company. The drift of Eldorado's skilled employees to other mines during the 19505 can be attributed to a large number of factors, and morale is only one, as is rate of pay. But one cannot escape the conclusion that broader horizons in the public service were not proportionate to tangible reward. The history of Canadian uranium mining is the story of a highly political, if not politicized, industry. At its origin, Eldorado received support and encouragement from the federal government in order to promote a clear national objective: the development of the wonder substance radium for the fight against cancer. Both government and Eldorado expected several kinds of reward: prestige for scientific progress, and cash from the sale of a scarce commodity, for radium was as restricted in its supply as it was longed for by its potential customers. The supply of radium was dominated by a single Belgian company, the Union Miniere. Eldorado hoped simultaneously to break the Union Miniere's monopoly and to cash in on its price. Not surprisingly, it failed and, failing, joined with the Union Miniere in an international cartel to regulate, on a scientific basis, its markets and its profits. The personnel of the cartel, and to some extent its structure,

434

Eldorado

survived into the Second World War, when uranium rather than radium became the world's most desirable commodity. The nationalization of Eldorado between 1942 and 1944 occurred by coincidence rather than by design; as a consequence the ultimate control of Canada's uranium ore remained in Canadian hands rather than in those of an international, and probably Americandominated, syndicate. The Canadian government was unprepared for the acquisition of a company like Eldorado. Moreover, during the war, the company brought the government no profit and considerable administrative headaches. Because of the war emergency, the Canadian government had at hand considerable powers for dealing with Eldorado. Because of wartime secrecy and post-war defence preoccupations, Eldorado's affairs were, for the most part, regulated behind closed doors. The government had two objectives with Eldorado at the end of the war. Unlike most other wartime crown corporations, Eldorado had a continuing importance for the common defence of Canada and its principal wartime allies, the United States and Great Britain. The continuation of a ramshackle mining company that had taken a corps of accountants two years to sort out, whose ore reserves were dropping, and whose refinery had been put together out of ingenuity and baling wire would not otherwise have been a high government priority, especially when the government was called upon to ante up some million dollars to keep the company out of insolvency. It was at this point that the government's second objective manifested itself. If Eldorado was to be more than a short-term salvage operation, it had to be established on a firm commercial basis. The company was reorganized by 1947 to make it viable as an organization, with normal management practices, accounting procedures, and appropriate investment in technology. But to survive over the long term it must make a profit, and to make a profit it must have a customer. Politics determined that the customer must be an allied government, and circumstances produced one: the United States. Already the sole customer for Eldorado's uranium output during the war, the United States remained in that position for the first twelve years of the peace. The United States' purchasing agency, the Atomic Energy Com-

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mission, was bidding for uranium in a seller's market, and despite its occasional craving for a monetary contribution from the Canadian government, it always met the seller's basic terms. Those terms kept the USAEC at arm's length, out of Eldorado's books, and out of the direction of the Canadian uranium industry. The result was highly profitable to the Canadian government. Regular dividends flowed into the public coffers from Eldorado, repaying the government's initial investment in the company with interest. In return the government was able to swallow the political risk involved in developing a uranium mining galaxy in the 19508, at the cost of half a billion dollars in private and public investment. The size, cost, and duration of the American contracts guaranteed that the investment would be repaid; but the government remained uneasily aware that a simple balance sheet of uranium gains and losses would not be enough to deflect all criticism of its policy. So it proved. The political consequences of the American departure from the Canadian uranium market were considerable, even though mitigated by the imaginative and successful stretchout program worked out by Eldorado in the summer of 1959. In its last major assignment as supervisor of the Canadian uranium industry, Eldorado rationalized the industry into four major companies, the ones most likely to survive as competitive units in the lean years projected for the 19605. Eldorado itself was one of those companies, and under Gilchrist the company succeeded in fending off the worst and most damaging initiatives of its private competitors, who attempted, through politics, to rid themselves of a 'privileged' competitor. It was fortunate that Eldorado continued to enjoy some bureaucratic and political support; it was less fortunate that the company was not released from its public role to seek its future as a private mining company. The dichotomy between public responsibility and competitiveness benefited both the Canadian uranium industry and Eldorado; but it was and would continue to be a handicap to the company in establishing a place for itself as a Canadian mining corporation.

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Notes

AECB AECL CIMM CIMMT CPC CDT DEA DOE EP FECB FP FRUS NA NRC NT OSRD PAC PAO PC PRO RG SAB USAEC USNA

Atomic Energy Control Board Atomic Energy of Canada Limited Canadian Institute of Mining and Metallurgy Canadian Institute of Mining and Metallurgy Transactions Combined Policy Committee Combined Development Trust Department of External Affairs Department of Energy (u.s.) Eldorado Papers Foreign Exchange Control Board The Financial Post Foreign Relations of the United States See USNA National Research Council Northern Transportation Office of Scientific Research and Development Public Archives of Canada Public Archives of Ontario Privy Council Public Records Office Research Group Saskatchewan Archives Board United States Atomic Energy Commission United States National Archives

43^

Notes to pages 9-25 PROLOGUE

1 New York Times, 14 Jan. 1930, 5 2 Rudolf Brunngraber, Radium, English translation (New York 1937), 443-4. The information in the prologue is derived from Edward R. Landa, 'The First Nuclear Industry,' Scientific American (Oct. 1982), 180—93, and 'The Great Radium Mystery,' Fortune (Feb. 1934), 70-5, looff. CHAPTER 1

1 George Keith to Roderick Mackenzie, 19 Nov. 1812, in L.P.R. Masson, ed., Les Bourgeois de la Compagnie du Nord-Ouest, n (New York 1960), 100—6 2 John Franklin, Narrative of a Second Expedition to the Shores of the Polar Sea (Edmonton 1971), appendix, ii—iv 3 Charles Camsell, 'Discovery and Development of Radium at Great Bear Lake,' Journal of the Franklin Institute (June 1942), 545-57; Camsell, Son of the North (Toronto 1954), 113-27 4 Morris Zaslow, 'The Development of the Mackenzie Basin, 1920—1940,' PH D thesis, University of Toronto, 1957, i, 164-7 5 G.G. Duncan, 'Using Plane Speeds Work of Finding Mine,' Financial Post (henceforth FP), 26 March 1931, p. 7 6 On Gilbert and Charlie, see D.M. LeBourdais, Canada and the Atomic Revolution (Toronto 1959), 43—4; George Lonn, Builders of Fortunes (Toronto 1963), 24, 29; on Gilbert alone, Peter C. Newman, Flame of Power (Toronto 1959), 149-68 7 Eldorado Papers (henceforth EP), Board of Directors Minute Book, W.J. Duncan to Charles LaBine, 29 Jan. 1929. Duncan, from Seaforth, wrote on behalf of shareholders with 11,000 shares. 8 Doug Fetherling, Gold Diggers 0/1929 (Toronto 1979), 24 9 EP, Board of Directors Minute Book, J.S. Millenbach to Gilbert LaBine, 30 Nov. 1928; board minutes, 13 April 1934 10 EP, 5 Jan. 1929; W.J. Duncan to C. LaBine, 29 Jan. 1929 11 EP, J.A. MacAulay to C. LaBine, 20 Dec. 1928 and R.A. Purves to C. LaBine, 14 Jan. 1929; with resolution of western shareholders 12 EP, board minutes, 31 Jan. 1929 and 18 Feb. 1929; LaBine quoted in George Lonn, Builders of Fortune (Toronto 1963), 29 13 EP, speech by LaBine at a complimentary dinner tendered by Eldorado, 12 Nov. 1932; Peter Newman, Flame of Power, 155-7 14 Newman, Flame of Power, 157; Lonn, Builders, 29 15 In reconstructing these events I have relied on a variety of sources. The Eldorado Papers contain two speeches by Gilbert LaBine, the first to company employees in 1932, and the second dated November 1934. LaBine also pro-

Notes to pages 27-46

16 17

18 19

20 21

22

23 24 25 26 27 28 29

30 31

32

439

vided the company magazine, The Refiner, with an account for its September 1960 issue. Ted Nagle put together his reminiscences of the summer of 1930 in J.D. Abbatt, ed., 'Historical Description Appendices of Main Work Sites' for the company epidemiology project (Ottawa, Dec. 1982). Charlie's account is in Lonn, Builders, 29. EP, board minutes, 7 Feb. 1931; FP, 12 Feb. 1931, 18 EP, Glassco Series, Document 106, B.P. Coyne and J.S. Godard, 'Analyses and Experimental Tests on a Radium-Bearing Ore from the Great Bear Lake District, N.W.T.,' 16 Feb. Ibid., 9 Apr. 1931,20 Canada, House of Commons Debates, 7 May 1931. The question was asked by Peter Heenan, who therefore receives the honour for Eldorado's public political baptism. Ibid., 11 May 1931, 1444; London Times, 16 Apr. 1931 FP, 16 Apr. 1931, 23; 16 July 1932, 14; 18 July 1931, and 25 July 1931; 30 Apr. 1931; The Refiner, Sept. 1960, 7-8: 'Port Radium: Story of Its Beginnings as Told by Gilbert LaBine' FP, 21 May 1931: LaBine's message was evidently sent some time in April; FP, 26 Sept. 1931, 20; LaBine to Nagle, 30 Dec. 1931, in Abbatt, 'Historical Description,' 22 FP, 20 Feb. 1932, 20 Department of Mines, Annual Report, 1931-32 (Ottawa 1932), 2 Ibid., 1932-33 (Ottawa 1933), 1-2 Canada, House of Commons Debates, 23 May 1932, 3273—85 FP, 2 July and 20 Aug. 1932; ibid., 17 Sept. 1932 New York Times, 29 May 1932, ix, 14 Contemporary versions of the rush are in J.A. McRae, 'Progress at Great Bear,' Saturday Night (17 Sept. 1932), 13, 24; New York Times, 20 Aug. 1932, 2 and 21 Dec. 1932; London Times, 21 Dec. 1932; FP, 3 Sept. 1932, 14, and 22 Apr. 1933, 6 May 1933 for BEAR Ray Price, Yellowknife (Toronto 1967), 44—5 FP, Survey of Mines (Toronto 1933), 156. The best account of the Great Bear rush is Frederick B. Watt, Great Bear (Yellowknife 1980). Watt was both a participant and an observant journalist. 'The Great Radium Mystery,' Fortune (Feb. 1934), 70-5, looff CHAPTER 2

1 PAC, RG 22, vol. 185, file 40-3—1, Hugh Spence, 'Operations of Eldorado Gold Mines Limited, LaBine Point, Great Bear Lake,' 30 Sept. 1937 2 F.B. Watt, Great Bear (Yellowknife 1980), 72-3 3 Ibid.

440

Notes to pages 47—63

4 EP, board minutes, 7 March 1933 5 I am grateful to R.E. Barrett, former professor of mining engineering at the University of Toronto, for sharing his experience and his insights on mining conditions in the 19305. On Eldorado, the best single source is a series of articles by the mine staff in the Canadian Institute of Mining and Metallurgy Transactions XLI (1938), 61-76. 6 See Spence report, note i 7 Articles in the Sunday Times, December 1937, quoted in Janet Adam Smith, A Biography of John Buchan (Boston and Toronto 1965), 415 8 Edgar Laytha, North Again for Gold (New York 1939), 16 9 FJ. ('Tiny') Peet, 'Great Bear, Eldorado and Briefly Port Hope in the igso's,' in J.D. Abbatt, ed., 'The Eldorado Epidemiology Project: Historical Description Appendices of Main Work Sites' (Ottawa 1982), 55-6; mimeo 10 Ibid., 63 11 Ibid.,68 12 See CIMM Transactions (1938), 69 13 Peet, 'Great Bear, Eldorado,' 58—9 14 Spence report, 1937; see note i 15 Kathleen Connell,yam Yesterday (New York 1945), 138, 144-5 16 G.H. Armstrong, Origin and Meaning of Place Names in Canada (Toronto 1930), 228 17 W. Arnot Crack, Port Hope Historical Sketches (Port Hope 1901), 121 18 EP, Pochon Collection, Charles LaBine to Marcel Pochon, 8 May 1931 19 EP, Glassco Series, NA, report 're: Marcel Pochon and South Terras Mine, St. Stephen-in-Brannel, Cornwall,' 28 June 1945 20 EP, Mingay Series, file Port Hope (OD), Pochon to Eldorado, 21 May 1931 21 Ibid, and Pochon Papers, Charles LaBine to Pochon, i June, 3 July, 29 July, 5 Sept., 24 Sept., 25 Sept., 13 Oct., 29 Oct. 1931 and 8 March 1932; Memorandum of Agreement, 2 March 1932 22 EP, Board of Directors Minutes, 26 July 1932 23 EP, Mingay Series, file 'Port Hope Refinery, purchase, setting up':,'Inventory of the Morrow Seed Company, 27 July 1932' and W.J. Crowhurst, mayor and clerk, to 'C.A. Sabine,' 25 July 1932 24 R.J. Traill, 'Extraction of Radium from Great Bear Lake Pitchblende,' CIMMT (1933). 448-67 25 EP, Mingay Series, Mingay interview with Percy Phillips, Feb. 1977 26 PAC, King Diary, 16 Nov. 1936 27 London Times, 18 Nov. 1936, 13 28 EP, Board of Directors Minutes, 7 March 1933; FP, 15 and 22 July 1933 29 FP, 15 and 22 July 1933. The lucky syndicate was supposed to have been Ne York and Canadian mixed. 30 EP, board minutes, 7 May 1934; FP, 12 May 1934, 22

Notes to pages 64-75

44 l

31 EP, board minutes, 10 Oct. 1934. Interest at 6% was standard for the period. 32 EP, Lesslie Thomson, 'Re: Report on Eldorado Mining and Refining,' Feb. 1946, 65 33 Saturday Night's Analyses of Canada's Active Mines and Mining Atlas (Toronto 1936), 23; EP, board minutes, 25 June 1936 and 2 Dec. 1936 34 Laytha, North Again for Gold, 94—5 35 EP, annual meeting, minutes, 14 July 1936; FP, 18 July 1936, 2 36 FP, Nov. 1936, 26; Laytha, North Again, 95-6 37 Tiny Peet: see n^te 13 above; Percy Phillips interview, 1977 38 Financial Post Corporation Service, 'Eldorado Gold Mines,' 5 May 1938 39 EP, Pochon Collection, Laboratory Records, 1936-1942 40 PAO, RG 10/18/15-3-11, memorandum to minister, 31 Jan. 1935; FP, 3 March 1934, 16 41 PAO, RG 10/18/15—3—11, chief inspector of health to minister, 31 January

!935 42 Ibid., John Leitch to W.J. Bell, 29 Apr. 1935; Toronto Star, 4 Jan. 1936, recording the actual delivery 43 PAO, RG 10/18/15—3-11, Ont. government Radium Report, 13 Apr. 1942; Canadian Public Health Journal (Feb. 1940): Hardisty Sellers, 'The Contribution of the Ontario Cancer Clinics to the Control of Cancer' 44 Fourth Annual Report of the National Radium Trust and Radium Commission 1932— I 933i Cmd 4427 (London 1933), 9; Fifth Annual Report..., Cmd 4711 (London 1934), 9; Sixth Annual Report..., Cmd 5112 (London 1936), i 45 Ibid., Eighth Annual Report..., Cmd 5612 (London 1937), 9-10 46 EP, board minutes, 25 Sept. 1937; Mingay Series, file 'Radium Sales, Original Dox,' Carl French, 'Analysis of Sales Representation in England and the Continent,'June 1937 47 EP, Snyder to Gilbert LaBine, 22 April 1938. It took from about September 1937 until April 1938 for these events to mature. Italics are in original. 48 Interview with Bertrand Goldschmidt, Washington, November 1979; EP, Mingay Series, file 'Radium Sales (original Dox),' 'An agreement made this thirtieth day of April, 1938 ...' 49 FP, 9 March 1940, 19: 'How Eldorado is Operating in Wartime' 50 Ibid., 25 May 1940, 14 51 EP, board minutes, i and 5 June 1939 (the last Snyder attended); minutes of annual general meeting, 29 June 1939. Snyder was actually nominated by a shareholder, W.R. Sweeney, who then inspected the official register of shareholders to confirm that Snyder indeed held no stock and was ineligible to run. 52 Ibid., board minutes, 26 March, 14 June, 1940; minutes of annual general meeting, 16 April 1940; FP, 8 June 1940, 27 53 PAC, RG 22/59/346, Charles LaBine to Charles Camsell, 19 June 1940

442

Notes to pages 76-95

54 Ibid., Charles LaBine to Camsell, 21 June 1946; EP, board minutes, 17 July 1940 I N T E R L U D E : THE ATOM 1 H.L. Anderson, Enrico Fermi, Leo Szilard, 'Neutron Production and Absorption in Uranium,' Physical Review LVI (i Aug. 1939), 284—6 2 Herbert L. Anderson, speech to the Canadian Undergraduate Physics Conference, Ottawa, 10 October 1976 3 Ibid.; Frisch quoted in Ronald W. Clark, The Greatest Power on Earth (London 1980), 45 4 Quoted in ibid., 50 5 New York Times, 3 Feb. and 5 Feb. 1939, and 'Highlights of Science during the Year,' 31 Dec. 1939 6 Quoted in Clark, Greatest Power, 58—9 7 Quotations in text, ibid., 58—60; PRO, AB 1/37, N/A, 'Uranium: History of Action up to loth May, 1939.' Clark (Greatest Power, 60) adds that on his return to Belgium Sengier had 'about 1,200 tons in 2,000 steel drums' sent to the United States, presumably to be added to the 200-300 tons mentioned above.' 8 Clark, Greatest Power, 81 9 F.D. Roosevelt (FDR) Library, Hyde Park, NY, 'Atomic Energy File,' Einstein to Roosevelt, 2 Aug. 1939 10 Ibid., Sachs to Roosevelt, 11 Oct. 1939 and enclosure; S.R. Weart and G.W. Szilard, Leo Szilard: His Version of the Facts (Cambridge, Mass. 1980), 82—6 11 Margaret Gowing, Britain and Atomic Energy (London 1965), 85, 95—6 12 Ibid. 13 EP. Company records for the war are confused and fragmentary. One file, 'Sales — Radium & Uranium 1939—40—41-42-43,' summarized Eldorado's sales for war purposes and lists customers. 14 On the American uranium program, see Richard G. Hewlett and Oscar E. Anderson, A History of the United States Atomic Energy Commission, vol. i: The New World (Washington 1972), and Martin J. Sherwin, A World Destroyed: The Atomic Bomb and the Grand Alliance (New York 1977) CHAPTER 3

1 EP, Directors Minutes, Annual Report (Toronto 1941) 2 EP, board minutes, 8 Nov. 1940 3 There are many sources on the subterranean history of the Union Miniere and Boris Pregel for this period. The u.s. Treasury seems to have prepared, and handed on to u.s. Military Intelligence, an account of Union Miniere's

Notes to pages 95-112

4 5 6 7

8 9 10 11 12 13 14 15 16 17 18 19

20

21 22

23 24 25

443

activities entitled, 'Memorandum: General Considerations,' which seems to date from early 1949. It is to be found in the u.s. National Archives (USNA), RG 77 (Records of the Corps of Engineers, Manhattan District), file 'Boris Pregel.' British Intelligence's biography of Pregel is in the PAC, C.D. Howe Papers, vol. 13, file s-8—2 (312), 'B. Pregel and G. Chilowsky.' Glassco's analysis is enclosed in a letter to C.D. Howe dated i April 1947, in the Eldorado Papers. FP, 3 Nov. 1945, 'Who is Boris Pregel?' USNA, RG 227, box 85, file 'Canadian Radium and Uranium Corporation,' Briggs to Pregel, 21 May 1941 and Pregel to Briggs, 7 July 1941 EP, Glassco Series, document 434, Briggs to LaBine, 26 Dec. 1941 USNA, RG 227, box 85, file 'CRUC,' Pregel to R.J. Lund, 9 Dec. 1941; Briggs to Pregel, 24 Dec. 1941; EP, Glassco Series, doc. no. 434, Pregel to LaBine, 5, 6, and 11 March 1942 USNA, RG 77, file Boris Pregel, Compton to General L. Groves, 21 Sept. 1945 Ibid., RG 227, box 85, file 'CRUC,' Pregel to Irvin Stewart, 27 May 1942; Stewart to Briggs, i June 1942 EP, board minutes, 24 March 1942 Wilfrid Eggleston, Canada's Nuclear Story (Toronto 1965), 45 Murphy interview, Toronto, May 1982 USNA, RG 227, OSRD s—i, Bush-Conant files, folder 73, Marvin L. Faris to Irvin Stewart, 17 April 1942 Murphy interview; Bert Powell interview Murphy interview USNA, RG 77, file EIDM o-23 MS, Phillip Merritt, 'Visit to Eldorado Mine, Northwest Territory, Canada on 22-23-24-25 March 1944' Ibid.; Murphy interview USNA, RG 77, file EIDM 0-3—3 MS, Merritt to Groves, 5 Jan. 1944 A. Cave Brown and C.B. MacDonald, eds, The Secret History of the Atomic Bomb (New York 1977), 59. Despite its melodramatic title, the editors in this case are reprinting the 'Smyth Report,' published originally in 1945, an official account of the deeds of the Manhattan Project. EP, Glassco Series, doc. 434, Boris Pregel to Eldorado, 16 July 1942; PRO (Kew), AB 1/80, British Purchasing Commission, Washington, to Sir E. Appleton, i May 1942, noting forthcoming u.s. orders, after i July EP, Glassco Series, doc. 434, Pregel to Eldorado, 22 Dec. 1942 R.G. Hewlett and O. Anderson, The New World: A History of the US Atomic Energy Commission (Washington 1972), 86; interview with General Kenneth Nichols, May 1981 EP, Glassco Series, J. Grant Glassco to C.D. Howe, i April 1947 Ibid., doc. 434, Carl B. French to CRUC, 31 March 1943 Brown and MacDonald, Secret History (Smyth Report), 58

444

Notes to pages 112—29

26 EP, board minutes, 5 Oct. 1942; Jack Burger interview; Farmer interview, Nov. 1982 27 Farmer interview 28 EP, Pochon Papers, NA, 'Basic Plant Wages,' n.d., The Canadian Unionist, Jan. J 943' 205; May 1943, 251; July 1943, 38 29 Farmer interview. The information in this paragraph summarizes information found in the detailed contract files in the EP. CHAPTER 4 1 See Margaret Cowing, Britain and Atomic Energy, 1939-1945 (London 1965), 108-10 2 This narrative is based on British, American, and Canadian documents. British plans for the 15 June meetings are spelled out in a telegram from Sir John Anderson to Malcolm MacDonald, 12 June 1942, PRO CAB 126/103. A first telegraphic report of the conversations (MacDonald to Anderson, 16 June 1942, ibid.) is supplemented by detailed minutes dated 15 June of the three Ottawa meetings, and of subsequent meeting with Bush on 17 June (ibid.). The best Canadian sources are the diaries of C.J. Mackenzie and Mackenzie King for 15 June 1942, both in the PAC. The slight American involvement (consent to others' arrangements) is documented in FDR Library (Hyde Park, NY), Atomic Bomb File, folder 2, Bush to Roosevelt, 19 June 1942 and Roosevelt to Bush, 11 July 1942; USNA, RG 77, OSRD Papers, BushConant file, Bush to Mackenzie, 15 July 1942. 3 PAC, Howe Papers, v. 13, file 8—8-2(31), LaBine to Howe, 7 July 1942; Howe to LaBine, 7 July 1942; Howe to MacDonald, 15 July 1942 4 Ibid., Howe to LaBine, 7 July 1942; John Proctor interview, Toronto, 1980 5 Ibid., vol. 6, file 5-8—2(5), Brown to Howe, n.d., but undoubtedly early July 19422 6 EP, Lesslie Thomson, 'Report on Eldorado Mining and Refining,' February 1946 7 Howe Papers, vol. 7, file 5—8-2(10), John MacAulay to Howe, 28 Nov. 1947; W.E. McElhone interview, Victoria, BC, Aug. 1981 8 PC 6083 of 1942, quoted in C.P. Stacey, Arms, Men and Governments (Ottawa 1970), 516 9 See Robert Bothwell and William Kilbourn, C.D. Howe: A Biography (Toronto 1979), especially chapter 10 10 PRO, AB 1/80, Anderson to MacDonald, 15 July 1942: 'Decypher yourself; MacDonald to Anderson, 17 July 1942 11 EP, file 1—75—0—12, LaBine to Howe, 28 May 1943; interview with General Kenneth Nichols, May 1981 12 W. Eggleston, Canada's Nuclear Story (Toronto 1965), 51-62

Notes to pages 129-39

445

13 PRO, AB 1/80, Akers to Perrin, 2 Nov. 1942; Akers to Perrin, 29 Nov. 1942; Akers to Howe, 4 Dec. 1942; Howe to Akers, 5 Dec. 1942; AB 1/120, Akers, to Perrin, 6 Dec. 1942 14 Pregel came early to British notice, and in July 1942 he was actively engaged in trying to sell them uranium. His past clung to him, however. On 7 Aug. 1942, Perrin wrote to Akers to tell him about the pre-war radium cartel on the basis of Ministry of Health information. The Ministry of Aircraft Production, he added, was also satisfied 'that Union Miniere also controls the Eldorado Company' (AB 1/47). The controversial report on Pregel was presented to Howe by Malcolm MacDonald some time after his return from London. See Howe Papers, vol. 14, file 8-8-2(32), record of a meeting held in the Lord President's Room, 12 Oct. 1942; NA, memorandum, 'B. Pregel and G. Chilowsky,' 23 Oct. 1942; Howe to LaBine, 27 Oct. 1942; LaBine to Howe, 31 Oct. 1942; Howe to LaBine, 9 Nov. 1942; Howe to MacDonald, 11 Jan. 1943; MacDonald to Howe, with end., 19 Jan. 1943. The enclosure in the last letter is the LaBine/Pregel rebuttal, entitled, 'Memorandum Re: Boris Pregel' 15 EP, file 1-75-11-12, C.B. French to Pregel, 24 March 1943 16 PRO AB 1/80, Halban to Akers, 31 March 1943; AB 1/131, R.E. Newell, 'Probable Metal Supplies and Oxide Requirements,' 24 June 1943 (40 tons estimate); AB 1/80, Akers to Perrin, 17 June 1943 (120 tons) 17 Goldschmidt interview 18 AB 1/80, Goldschmidt to Akers, 'Second Report on the Eldorado Gold Mine Company,' 4 May 1943 19 PRO, CAB 126/103, Akers, 'Tube Alloy Project: Note on talk with Dean C.J. Mackenzie,' 14 May 1943. 20 Ibid., PREM i3g/8A, 'T.A. Project: Supply of Materials,' n.d. [spring 1943]; CAB 126/163, minute by Gorell Barnes, 29 June 1943 21 EP, file 1—75-11-12, Howe to LaBine, 26 May 1943; LaBine to Howe, 28 May *943 22 USNA, Col. John Ruhoff to Brig. Gen. Groves, 5 Jan. 1944 (RG 77, file EIDM 0-3-3 MS). The cumulative total of ore supplies from all sources was estimated at 5728 tons by July 1945; requirements down to Nov. 1944 were set at 4096 tons (the comparable figure for supply, Nov. 1944, was 5608 tons.) 23 PRO AB 1/80, Akers to Perrin, 17 June 1943 24 Ibid.; PAC, Mackenzie Diary, 30 June 1943 25 Ibid., 7 and 10 July 1943. In 1941 in similar circumstances Howe had sent in his resignation to Mackenzie King: Bothwell and Kilbourn, Howe, 162-4. 26 PRO CAB 126/103, Akers to Anderson, 30 June 1943 27 Mackenzie Diary, 13 July 1943 28 PRO AB 1/81, Akers, 'Points for Discussion with Canadian Authorities,' with minute by MacDonald; Anderson to High Commission, no. 1585, 2 July 1943 (CAB 126/103)

446

Notes to pages 140—50

29 AB 1/82, Perrin to Akers, 12 July 1943; AB 1/81, MacDonald to Anderson, 6 July 1943; MacDonald to Anderson, 10 July 1943; MacDonald to Anderson, 30 31 32 33 34 35 36 37 38

39 40

41

42

43

44

iTjuty !943 Ibid., Akers to Perrin, 23 July 1943 Ibid. Gowing, Britain and Atomic Energy, 170 PRO AB 1/81, Akers to Perrin, 23 July 1943 Ibid.; see also Hugh Keenleyside, Memoirs n (Toronto 1982), a-b A. Cave Brown and C.B. MacDonald, The Secret History of the Atomic Bomb (New York 1977), 191 EP, 1-75—u—12, Howe to LaBine, 26 May 1943; Howe Papers, vol. 13, file 5-8-2(31), LaBine to Howe, 28 May 1943 Howe Papers, Howe to LaBine, 12 June 1943 RG 77, file MI—13—33, Col. K.D. Nichols to Brig. Gen. Groves, 8 and 11 Aug. 1943. One possibility is that some of the stock manipulation was the result of the disposal of a block of shares (reputed to be 600,000) by Charles Bohn and William Sweeney, associates of Irving Babcock. Bohn and Babcock were former directors and their holding, though large, is believable. PAC, Mackenzie Diary, 26 July 1943 Ibid., RG 28 (Munitions and Supply Records), vol. 173, file 4-1-491(4); Ruhoff to Thomson, 29 July 1943; Guarin to Thomson, 31 July 1943, recording a visit the previous day; RG i, Camsell to Morrow, 13 Sept. 1943; PC 7168 and PC 7167, 15 Sept. 1943 USNA, RG 77, file 'Boris Pregel,' 'Recording of a Conversation between Brigadier General Leslie R. Groves and Mr. Boris Pregel at a conference Monday 25 October 1943' Nichols interview. The most vocal reaction to the orders-in-council came from Thayer Lindsley, the president of Ventures. Lindsley complained to Howe, who referred him to LaBine. LaBine gave Lindsley no sympathy, at which point Lindsley demanded to know, 'How will you justify yourself in the face of the mining fraternity if you undertake this job for the Government?' The fact that Lindsley had undertaken 'this job' for the American government did not seem to strike the indignant promoter as relevant or important. See PAC, Howe Papers, vol. 14, file 8—8—2(32), Howe to LaBine, 22 Nov. 1943; Lindsley to Howe, 14 Dec. 1943; LaBine to W.J. Bennett, 18 Dec. 1943 Howe's statement was copied verbatim in several Canadian newspapers. In contrast to their stories of the previous year, they added little in the way of comment. A formal letter to Eldorado's shareholders appeared over LaBine's signature in the FP, 5 Feb. 1944, and the Globe and Mail, 29 Jan. 1944. PAC Mackenzie Diary, 18 Jan. 1944; PRO, CAB 126/103, MacDonald to Anderson, 29 Jan. 1944, with minute by Anderson attached

Notes to pages 150-68

447

45 PAC RG 28, vol. 173, file 4—1—491(5), Thomson memorandum, 2 Sept. 1943 46 Ibid., file i—75—u—7, Carl French to Lesslie Thomson, 22 June 1944. The contract numbers were w—74O5~eng-252 (Sept. 1943), —264 (Oct. 1943) and-281 (Jan. 1944). 47 RG 28, file 4—1-491 traces the tedious story of these negotiations. On the FECB, interview with Supt. Terry Guernsey, RCMP ret'd, Oct. 1980; EP, Thomson, Report, Feb. 1946, 42 48 PAC RG 2&A, vol. 175, file 4-1-491(18), Birks to Thomson, 8 Dec. 1944; Birks to Thomson, 18 Dec. 1944; Pregel to Birks, 18 Jan. 1945; Birks to Thomso 31 Jan. 1945 49 PAC, Mackenzie Diary, 24 Nov. 1944 50 EP, Glassco to Howe, i April 1947 51 Newsweek, 31 Dec. 1945 and 25 Feb. 1946 52 EP, Annual Report, 1946 53 PAC, Mackenzie Diary, 16 Aug. 1945; W.E. McElhone interview, Victoria, Aug. 1981

I N T E R L U D E : COLD WAR 1 This paragraph is based on the account in James Eayrs, In Defence of Canada in (Toronto 1972), 274—5. 2 Regina Leader-Post, 6 Aug. 1945; Toronto Star, 7 Aug. 1945 3 Daily News cited in Star and Leader-Post, 8 Aug. 1945. On the 1945 spy scandal, see R. Bothwell and J.L. Granatstein eds, The Gouzenko Transcripts (Ottawa 1982) 4 Quoted in Eayrs, In Defence in, 277—8 5 PAC, Howe Papers, vol. 13, file 5-8-2(30), Bateman to Howe, 10 Aug. 1945; Howe to Bateman, 17 Aug. 1945 6 PAC, RG 77, vol. 284, file 'RR,' v. 2, Wrong to Mackenzie, 22 Oct. 1945 and Mackenzie to Wrong, 26 Oct. 1945 7 Summarized in Eayrs, In Defence in, 278-9 8 This account of the Washington conference is based on Margaret Gowing and Lorna Arnold, Independence and Deterrence i (London 1974), 68—86; Richard G. Hewlett and Oscar Anderson, The New World (Washington 1972), 459-69; Eayrs, In Defence in, 279—81; and PAC, Mackenzie Diary, 13,15 Nov. 1945. Mackenzie King's diary, usually so reliable, is missing for this period. CHAPTER 5 1 Quoted in William Taubman, Stalin's American Policy (New York 1982), 146 2 PAC, RG 77 (NRC Papers), vol. 284, file RR, vol. 2, 'Preliminary memorandum of content of proposed act to safeguard uranium and atomic energy.' The memorandum was unsigned, but style and content point to Wrong.

448

Notes to pages 169—89

3 RG 2/18 (Privy Council records), file w~46-A(i), Wrong to Heeney, 15 Oct. !945 4 Ibid., file w~46-A(2), Wrong to Robertson, 22 Oct. 1945; House of Commons Debates, 5 Dec. 1945, 2959 5 Howe Papers, vol. 5, file 8—8—2(4), Heeney to Howe, 20 March 1946; RG 2/18, file R-ioo—A(I), Howe to Heeney, 23 March 1946; John Swettenham, McNaughton in (Toronto 1969), 108, citing a 1947 article by Ignatieff 6 External Affairs Records, file 201—E(S), Minutes of the Advisory Panel, 16, 26, 30 April and 7 May 1946 7 Howe Papers, vol. 13, file 8-8-2(30), Howe to Bateman, 18 Oct. 1945 8 U.S. Department of State, Foreign Relations of the United States, 1946, i (Washington 1972), Kennan to Dean Acheson, 18 July 1946, with enclosure, 860-5 9 Ibid., Fred Searls to secretary of state, 24 Oct. 1946, 964-5. The most concise Canadian account of these discussions is John Holmes, The Shaping of Peace n (Toronto 1982), 45-56, and especially 48-50. 10 Howe Papers, vol. 5, file 8—8—2(3), Bateman to Howe, 8 Nov. 1945 11 External Affairs Records, file 201(5), Howe to Pearson, 30 Nov. 1945; Pearson to Robertson, 4 Dec. 1945; Howe Papers, vol. 13, file 8-8-2(30), Bateman to Howe, 4 Dec. 1945 12 Howe Papers, ibid., Bateman to Howe, 7 Dec. 1945 13 The subcommittee is covered in Hewlett and Anderson, The New World (Washington 1972), 478—79; Heeney's comment is in External Affairs Records, file 201(5), Heeney to Pearson, 31 Jan 1946. 14 External Affairs Records, ibid., Pearson to Heeney, 12 April 1946 15 D. Page, ed., Documents on Canadian External Relations xn (Ottawa 1977), Howe to Bateman, 15 April 1946, 422 16 External Affairs Records, Howe to Bateman, 18 April 1946 17 M.J. Trebilcock and J.R.S. Prichard, 'Crown Corporations: the Calculus of Instrument Choice,' in J.R.S. Prichard, ed., Crown Corporations in Canada (Toronto 1983), 13 18 On Bennett, see R. Bothwell and W. Kilbourn, C.D. Howe (Toronto 1979), 131-2 19 Bennett's first appearance in Eldorado's story is in EP, file 1-75-11-12, Bennett to Carl French, 23 Oct. 1942. 20 Mackenzie Diary, 25 March 1946 21 EP, board minutes, 29 March 1946 22 EP, Annual Report, 1946. The annual reports for this period were unpublished, and secret. 23 Ibid., board minutes, 13 June, 22 July, 9 Sept. 1946 24 Interview with WJ. Bennett, Eldon Brown, and W.James, Toronto, June 19811 25 EP, Mingay Series, file 'Gaudin,' Gaudin to Bennett, 12 Aug. 1948

Notes to pages 189-205

449

26 Bennett, Brown, and James interview, April 1981 27 EP file i—75—u—i, Bolger to Merritt, 19 Jan. 1945 28 Powell to author, 5 April 1982; USNA, RG 77, file 'Eldorado Mining & Refining,' Merritt to Groves, 17 Dec. 1946 29 Bennett interview, 3 June 1982; USNA, RG 77, file 'Eldorado,' Bennett to Groves, 13 Dec. 1946; EP, Annual Report, 1946 30 EP, Annual Report, 1946; W.J. Bennett interview, 17 May 1982 31 Howe Papers, vol. 8, file 8-8-2(11), Bateman to Howe, 13 Jan. 1947; Howe to Bateman, 25 Jan. 1947 32 Ibid., Bennett to Howe, 25 Jan. 1947; Howe to Bennett, i Feb. 1947 33 PAC, RG 60 (AECB Records), vol. i, AECB minutes, 15 March 1947 34 PRO, AB 16/69, D.E. Peirson to Roger Makins, 23 May 1946; Peirson to W.L. Gorell Barnes, 7 Sept. 1946 35 Bennett interview, 17 May 1982; PRO, AB 16/69, R-A- Thompson to Peirson, 15 Feb. 1947 36 PRO AB 16/69, Clutterbuck to Dominions Office, 5 April 1947: Howe told him that 'more uranium was being mined all the time and would be available.' 37 Ibid., note by D.E. Peirson on a conversation with Howe, 19 Aug. 1947 38 Bennett interview, 2 June 1981: 'By the time he refused [to stockpile] the Americans were back in the market.'

CHAPTER 6 1 Foreign Relations of the United States (FRUS), 1947, i, George Kennan to Robert Lovett, 24 Oct. 1947. David Allan Rosenberg, 'u.s. Nuclear Stockpile, 1945 to 1950' in The Bulletin of the Atomic Scientists xxxvin (May 1982), 25—30 2 Margaret Gowing, Independence and Deterrence i (London 1974), 102—3; PAC > AECB Records, CPC minutes, CDT, 'Memorandum to the Combined Policy Committee,' 12 Dec. 1947 3 U.S. Department of Energy Archives, USAEC Collection, Secretariat, Box 1225, W.E. Kelley to Carroll Wilson, 14 April 1947 4 EP, binder =tt=i, correspondence, Bennett to Howe, 23 Aug. 1947 5 Figures on Eldorado's prices and deliveries are taken from EP, file 'Uranium Sales: USAEC Washington Discussions,' Bennett memorandum of July 1952; figures on u.s. and foreign supply are from R. Hewlett and F. Duncan, Atomic Sheild (Washington 1972), appendix 5. 6 FRUS, 1947, i, 835—7, Alan Kirk to Robert Lovett, 2 Sept. 1947; FRUS, 1949, i, 528, R.G. Arneson to Dean Acheson, 13 Sept. 1949; interviews with General Kenneth Nichols and R.G. Arneson, Washington, May 1981 7 PAC RG 28A, vol. 175, file 4-1-491(20), F.A. Paneth to Lesslie Thomson, 7 March 1945

45°

Notes to pages 205—28

8 Ibid, LaBine to Thomson, 16 Feb. 1945, with enclosure, Houston to LaBine, 16 Feb. 1945 9 PRO, AB 2/7 for Pontecorvo and May; EP, Port Radium files, R.W. Thompkins (of Teck Hughes), 'Ventilation and Dust Report,' August 1945; EP, Thomson to Howe, Report on Eldorado Mining & Refining, Feb. 1946, 48-51 10 EP, Mingay Series, file 'A.M. Gaudin: Research and Development,' Gaudin to Parsons, 6 Sept. 1946 11 Ibid., Parsons to Bennett, 8 Nov. 1946; EP board minutes 29 Oct. 1946; R.H. Farmer interviews, Nov. 1982 and April 1983 12 Pat Stevenson, 'Quonset Huts gave birth to uranium industry,' Canadian Nuclear Technology (spring 1962) 13 Ibid.; EP, Mingay Series, file 'Gaudin,' Bennett to Gaudin, 4 Feb. 1949 14 EP, file 'Port Radium Correspondence, 1946-1950,' Bennett to Gillanders, 5 Aug. 1947 15 Murphy interview; EP, Annual Report, 1947, 2-3 16 R.E. Barrett interview, Sept. 1982; Barbara Stack, Handbook of Mining and Tunnelling Machinery (Chichester and Toronto 1982), 272—3; J.C. Heaslipand T.N. Dawson, 'Light Weight Drill Combination Used in Canadian Mines,' Mining CongressJournal (Sept. 1951), 40—4; A.H. Hubbell, 'Tungsten Carbide Drilling Takes the Lead,' Engineering and Mining Journal (Feb. 1953), 111—6 17 Saunders interview, Vancouver, Oct. 1982 18 PAC, RG 28A, Vol 176, file 4—1-491(24), Bolger to LaBine, 24 Sept. 1945; Thomson to Bolger, 26 Sept. 1945; ibid., file 4—1—491(2) Bolger to Thomson, i Oct. 1945; EP, board minutes, 25 Sept. 1946; Ken Donald interview, Calgary, 20 April 1982; Campbell, Saunders, Boynton, Imrie interview, Vancouver, 5 Oct. 1982; Bennett interview 19 PAO, RG 10, box 2, file'Port Hope 1945-1947,'internal memo to Dr Cunningham, director of industrial hygiene, 27 Dec. 1945 20 Ibid., F.M.R. Bulmer and R.G. Elson to Cunningham, 15 Oct. 1945, giving minutes of the Royal York meeting 21 EP, Annual Reports, 1946, 1947, 1948, and 1949. These reports, labelled 'secret' included reports by each division manager, arranged in appendices at the end, and it is from Ross's appendices that the quotations are taken. 22 Frank Melvanin, 'The Port Hope Refinery,' in 'Historical Description Appendices' to the Eldorado Epidemiology Project, December 1982, 114-5 23 EP, Annual Reports, secret, sales manager's reports, 1946-9 24 EP, Annual Report, 1950, sales manager's report. It should be stressed that the unpublished secret report presents a much fuller view than the published one. See also W. Eggleston, Canada's Nuclear Story (Toronto 1965), 255—71, from which the Mitchell quotations are taken. 25 EP, board minutes, 19 March and 17 June 1948

Notes to pages 2 2 8—4 8

451

26 Ibid., 9 Feb. 1949. Bennett revealed that the cost per pound of oxide was $2.35 in 1948, compared to $1.17 in 1947.

INTERLUDE: SECURITY 1 Quoted in Peter Pringle and James Spigelman, The Nuclear Barons (New York 1981), 61 2 Material in this chapter is based on Peter Pringle and James Spigelman, The Nuclear Barons (New York 1981), 57—70 for the Soviet Union; they in turn based their work on studies by Arnold Kramish, and by David Holloway; Samuel Wells, 'The First Cold War Buildup: Europe in u.s. Strategy and Policy, 1950—52' (unpublished paper, Oslo, August 1983); on Canada, see R. Bothwell, I. Drummond, and J. English, Canada since 1945 (Toronto 1981) CHAPTER 7

1 Bennett to author, i Sept. 1983 2 PAC, RG 2/18, file R—100—A(I), Marcel Cadieux to Arnold Heeney, 11 Oct.

1947 3 Howe Papers, vol. 12, file 5-1-8(27), minutes of the advisory panel, 3 Dec. 1947 4 EP, file 'AECB (OD),' Bateman to Bennett, 31 Dec. 1947 and Bennett to Bateman, 3 Jan. 1948. The committee had actually met several times before it was formally appointed by PC 1068 of 16 March 1948 to be an advisory committee to the AECB. 5 John Swettenham, McNaughton in (Toronto 1969), 131; AECB minutes, 31 March 1948 (PAC RG 60, vol. 13). 6 Bennett to author, i March 1982; EP, file 'AECB (OD),' Howe to Bateman, 31 Jan. 1948; Bateman to Bennett, 16 Feb. 1948 7 EP, ibid., Bennett to Bateman, 24 Feb. 1948 8 Figures from the Report of the Raw Materials Subcommittee of the Joint Committee on Atomic Energy (Washington 1952), 2 9 EP, file 'AECB (OD),' Bateman to Howe, 2 March 1948 10 Canada, House of Commons Debates, 16 March 1948, 2284—5 11 Ibid., 18 March 1948; USNA, Suitland, MD, RG 84, file 800, bi-weekly embassy report, 6-20 March 1948 12 Department of Mines and Resources, Annual Report for 1948—9 (Otawa 1950); ibid., 1949-50 (Ottawa 1950), 40—1; Department of Mines and Technical Surveys, Annual Report for 1950-51 (Ottawa 1951), 77—8 13 J.L. Gaddis, Strategies of Containment (New York 1982), 80—2

452

Notes to pages 249—65

14 EP, file 'AECB (OD),' Bennett to Bateman, 19 Oct. 1949; ibid., binder series, binder no. i, C.H.E. Stewart, Transcontinental Resources, to Bennett, 20 March 1950 15 Bennett to author, 20 Sept. 1982 16 Howe Papers, vol. 11, file s—8—2(11), Bennett to Howe, 29 Dec. 194 17 Ibid., Bateman to Howe, 22 Dec. 1949; Bennett to Howe, 29 Dec. 194 18 Ibid., Bennett to author, i Sept. 1983 19 Department of Energy Archives (DOE), 326 USAEC Records, Secretariat Collection, Box 1233, folder Canada, AEC 175/2, 'Canadian Proposal for Increasing Price of Uranium Ore,' n.d. but March 1950 20 James Boyd, 'The Pulse of Exploration,' in Henry Jarrett, ed., Science & Resources (Baltimore 1959), 98. Boyd was vice-president in charge of exploration for Kennecott Copper, ex-director of the u.s. Bureau of Mines, and former Defense Minerals administrator in 1950-1. 21 EP, binder series, binder no. i, Bennett to Johnson, i April 1950 22 DOE, 326 USAEC, Secretariat Collection, Box 1233, folder Canada 175/2, 'Canadian Proposal for Increasing Prices for Uranium Ore,' 11 April 1950 23 Alan Cottrell, An Introduction to Metallurgy (London, 2nd ed. 1975), 96 24 Pat Stevenson, 'Quonset Huts gave birth to uranium industry,' Canadian Nuclear Technology (1962), 36—7 25 EP, file 'A.M. Gaudin,' Gaudin to Bennett, 12 Aug. 1948. 26 Ibid., file 'Port Radium Correspondence,' Bennett to Gillanders, 3 Feb. 1950; Jack Burger interview, 17 June 1982; Board of Directors Minutes, 9 Feb., 10 Dec. 1949 27 EP, Board of Directors Minutes, 5 May, 28 Sept. 1950. 28 DOE Archives, 326 USAEC Secretariat, Box 1225, folder Uranium Procurement, Bennett to Johnson, 6 Oct. 1950, Johnson to Bennett, 11 Oct. 1950 29 Murray Trigg to author, 25 Nov. 1982 30 Bennett interview 31 Ken Donald interview, Calgary; Gillanders, 'Summary of Western Operations,' November 1951, EP, Port Radium files 32 Bennett and Cay wood interview, Vancouver, 17 Oct. 1981 33 EP, board minutes, 10 Dec. 1953 and 26 March 1954 34 External Affairs Records, file 14002-1-1: Note on the decision by the Chiefs of Staff Committee on 12 Nov. 1953 to approve the defence of Canadian uranium 35 Ken and Sylvia Donald interview, Calgary 36 FRUS, 1950, i, 573: meeting of the American members of the CPC, 7 Sept. !95° 37 R. Hewlett and F. Duncan, Atomic Shield (Washington 1972), 443 38 Ibid., 466-7, 447-8 39 Johnson interview, Washington, Dec. 1980

Notes to pages 265—8'7

453

40 EP, binder series, binder no. i, Howe to Bateman, 17 Jan. 1951 41 Ibid., Bennett to Bateman, 20 Jan. 1951 42 Johnson interview; Merritt interview; EP, binder series, binder no. i, Bennett to Howe, 16 March 1951, giving a resume of events between January and March 43 EP, ibid., Johnson to Bennett, 28 Feb. 1951; Bennett to Johnson, 3 March 1951; Bennett to Bateman, 9 March 1951; Bennett to Howe, 16 March 1951; Bennett to Johnson, 16 March 1951 44 DOE Archives, 326 USAEC, Secretariat Collection, Box 1233, folder Canada, AEC 175/5, 26 March 1951; Decision on AEC 175/5, 3° March 1951 45 EP, board minutes, 5 Feb. 1949 and 28 Feb. 1950 46 Canada, Public Accounts Committee Minutes, 6 June 1950 and 8 June 1950, 599-629; Bennett to author, 8 July 1982 47 Bennett to author, 8 July 1982 48 Ibid. 49 On Sellar as auditor-general, see Sonja Sinclair, Cordial but not Cosy (Toronto 1979), 43—53; C.A. Ashley and R.G.H. Smails, Canadian Crown Corporations (Toronto 1965); M.J. Trebilcock and J.R.S. Pritchard, 'Crown Corporations: The Calculus of Instrument Choice,' in Pritchard, ed., Crown Corporations in Canada (Toronto 1983), 15-22; Bennett to author, 8 July 1982 50 Canada, House of Commons Debates, 27 Nov. 1951, 1359 CHAPTER 8 1 J.V.Wright, The Prehistory of Lake Athabasca (Ottawa 1971), 136-7 2 PRO, AB 16/686, Sir A. Clutterbuck to F.C. How (Ministry of Supply), 29 Sept. 1948, citing an interview with C.D. Howe 3 Because Saskatchewan's request was imprecise in its phrasing, Howe pretended not to understand it. 4 AB 16/686, George Cadbury to George Strauss, minister of Supply, 21 June 1948; minute by minister's secretary, 26 June 1948; Strauss to Cadbury, 5 July 1948; F.C. How to Clutterbuck, 24 Sept. 1948; Clutterbuck to How, 28 Sept. 1948 5 AB 16/686 and Clutterbuck to How, 28 Sept. 1948; Clutterbuck to Howe, 29 Sept. 1948; minute of meeting between minister of Supply and Premier Douglas, 20 Oct. 1948 6 EP, board minutes, 18 May 1955 7 Bennett to author, 8 Sept. 1982 8 Bell interview, Edmonton, April 1982; EP, board minutes, Feb. 1949 9 Bell interview 10 EP, board minutes, 10 Dec. 1949, 5 May, 10 Sept. 1950; Bennett, Brown, and

454

11 12

13

14 15 16 17 18 19

20

21 22 23 24 25 26 27 28

Notes to pages 287—99

James interview, June 1981: 'To save money, we lost money,'James said of the power project. EP, board minutes, 7 March 1951 The process was not without its own history — first used at Joachimsthal in the 18905, tried out in Sweden later on, and brought up as a promising technical innovation at a Raw Materials Conference in Ottawa in October 1948. PRO, AB 16/975, Davidson to R.E. France, 29 Nov. 1951; S.W.F. Patching to France, 6 Dec. 1951. Davidson attempted to claim the whole credit for the idea for the British, but was corrected by Patching. EP, Executive Committee Minutes, 20 Sept. 1951, 25 Oct. 1951, 13 Nov. 1951, 17 Dec. 1951; board minutes, 18 Dec. 1951; EP, file 'Commitment by USAEC to Purchase Beaverlodge Product and bail out Company if venture proves unsatisfactory,' Bennett to Johnson, i Oct. 1951; Bennett to Howe, 19 Oct. 1951; Johnson to Bennett, 19 Oct. 1951; Howe to Bennett, 20 Oct. 1951: T am quite prepared to stand behind your decision, whatever the outcome may be.' My thanks to my colleague, Professor Ian Drummond, for furnishing this ' information. Bennett to author, 9 Sept. 1983 PRO, AB 16/893, C.F. Davidson to P.J. Eaton, 3 Jan. 1950; Davidson to R.A. Thompson, 2 Jan. 1951 SAB, Kuziak Papers, file 17, Bennett to Hogg, 18 April 1952 Ibid., file 16, Robert Winters to Brockelbank, 27 Feb. 1951 and Brockelbank to Winters, 5 March 1951 A.H. Lang, 'Uranium in Canada, 1952,' CIMM Bulletin (May 1953), 309-10; Kuziak Papers, file 16, Brockelbank to Winters, 19 April 1952; Winters to Brockelbank, 23 June 1952; Brockelbank to Winters, 9 July 1952 Kuziak Papers, file 16, George Michalow to J.H. Brockelbank, 7 March 1952; R. Sexsmith to Michalow, 6 March 1952; Bennett to Brockelbank, 28 March 1952; Howe to Brockelbank, 28 March 1952 SAB, Brockelbank Papers, Hogg to Brockelbank, 8 Oct. 1952 and Brockelbank to Hogg, 14 Oct. 1952 Ibid., M. McConnell, Bureau of Publications, to Brockelbank, 11 Sept. 1951; A.I. Bereskin, controller of surveys, to Hogg, 24 Sept. 1951 Kuziak Papers, file 17, Berezowsky to Churchman, 7 Sept. 1951, enclosing draft memorandum of agreement Ibid., Bennett to Hogg, 13 March 1952; Hogg to Bennett, 21 March 1952 Ibid Ibid., Bennett to Hogg, 18 April 1952; Hogg to Bennett, 5 May 1952; Bennett to Hogg, 7 July 1952 Ibid., Churchman to Hogg, 11 March 1952 Ibid., undated memo (but 1953); Lang, 'Uranium in Canada,' 310

Notes to pages 299—324

455

29 Kuziak Papers, file 17, C.S. Brown to Churchman, 19 Feb. 1953 30 Ibid., Brockelbank to Howe, 14 Feb. 1953; Howe to Brockelbank, 21 Feb. !953 31 Ibid., Churchman to mining companies, business men, and residents of Uranium City 32 Kuziak Papers, Churchman to Brockelbank, 23 June 1953 33 Ibid., Fines to Brockelbank, 3 July 1953 34 Bennett interview 35 EP, 'Annual Report for 1952' (mimeo). This report, by Roy Henry, is not to be confused with the official annual report, which was printed. 36 University of British Columbia Library Special Collections, Mine Mill and Smelterworkers' Papers, box 31, file 3, Executive Board Minutes, 26 June 1951 and 23 Jan. 1953 37 Ibid., box 5, file i, report by Wm. Longridge dated 15 April 1954 - but actually 1953 38 Ibid., box 7, file 20, Murphy to Nels Thibault, 26 Sept. and 20 Oct. 1953; Bennett interview; EP, Beaverlodge files, Conciliation Board report, 21 May 1954; Collective Bargaining Agreement, 14 July 1954. 39 R. Hewlett and F. Duncan, Atomic Shield (Washington 1972), 559—78 40 EP, binder series, no. 2, Bennett memo, 're Contracting Policy,' 23 May 1952 41 DOE, Secretariat Collection, AEC meeting 661, 13 Feb. 1952; ibid., Johnson to Roy Snapp, AEC secretary, 31 July 1952 42 Ibid., AEC 378/30, 'Chronology on Canadian Raw Materials'; EP, Executive Committee Minutes, 15 May 1952; binder series, no. 2, Bennett to Charlie Williams, 15 July 1952 CHAPTER 9 1 USAEC Records, Jesse Johnson, 'Notes on Conversation with Mr. W.J. Bennett,' 31 July 1952; AEC 378/29, Snapp 'Itinerary for C.D. Howe and Party,' 12 Aug. 1952; Gordon Dean, Diary, 13 June, 11 July, 23 July, 15 Aug., 19-21 Aug., and 25 Aug. 1952 2 Ted Smith interview, 3 Sept. 1982 3 Annual Report, 1953 (Ottawa 1954), 7; Annual Report, 1954 (Ottawa 1955), 4 4 Ted Smith interview; Beaverlodge interviews 5 Trigg interview 6 James interview 7 Dolan interview; Eldorado, Annual Reports, 1953-58, passim 8 In discussing Beaverlodge I have relied, for impressions, on the memories of a number of veterans: Dick Barrett, Bill Gilchrist, Vince Dolan, Edmund Koenigshofer, Gus Rosta, Walter Rusinek, and, of course, Arvid Thunaes. 9 EP, Executive Committee Minutes, 25 Aug. 1953

456 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36

37

Notes to pages 324—42

Ibid., 2 Dec. 1953, n Nov. 1955 Bennett, Brown, James interview, June 1981 D.M. LeBourdais, Canada and the Atomic Revolution (Toronto 1959), 61, 64 Ibid., 68-71; Barry Hyams, Hirshhorn:The Medici from Brooklyn (New York !979)> 7°-3 LeBourdais, Atomic Revolution, 76 Northern Miner, i, 8 Jan., 26 Feb., 2, 9, 23 April 1953 Ibid., 5, 12, 19 Feb., 30 April, 21 May 1953 Ronald Schiller, 'Athabasca's Atom Boom,' Macleans' (\ March 1954), 12-3, 51-22 Ibid. LeBourdais, Atomic Revolution, 131—7; Hyams, Hirshhorn, 72—81 Bennett Papers, Speech to Prospectors and Developers' Association, 6 March 1951 EP,file'Uranium Sales - Private Producers,' Bateman to Guy Jarvis, 29 July 1953; Bennett to Barrett, 30 July 1953; Bennett to Howe, 30 July 1953; Howe to Bennett, 7 Aug. 1953 Ibid., file 'Uranium Purchasing - Special Price Contracts,' Bennett, 'Memorandum on Uranium Purchasing Policy,' 22 July 1955 Bennett and Johnson interview, Washington, 30 Nov. 1982 EP, file 'Bicroft,' table showing 'Uranium Contracts,' probably dating from Dec. 1957; Northern Miner, 15 Oct. 1953; n March, i and 22 July 1954 EP, black binder no. 2, Henry, 'Proposed Revised Price Schedule,' n.d. Ibid., Bennett to Bateman, 16 Nov. 1953 Ibid., Bennett to Johnson, 16 Nov. 1953; Bateman to Howe, 16 Nov. 1953; Northern Miner, 29 Oct. 1953 EP, file 'Uranium Purchasing Policy: Negotiations with Producers,'Johnson to Bennett, 10 Dec. 1953 Ibid., Henry to Bennett, 18 Dec. 1953 Ibid., Bennett to Johnson, 30 Dec. 1953; Bennett to James and Brown, Jan. 1954; Bennett to Howe, Jan. 1954 Ibid., Howe to Bennett, Jan. 1954 Ibid., Henry to Bennett, 23 Oct. 1953; black binder no. 3, Henry to Bennett, 2 Dec. 1954 EP, file 'Bicroft' table 'Uranium Contracts,' approximately December 1957 R.E Barrett, 'Memorandum' for author Sept. 1981; interview, Sept. 1981 Barrett interview EP, Executive Committee Minutes, 10 July 1951; Bennett to author, 8 Sept. 1982; EP black binder, Bennett memorandum, 'Memorandum re Refinery,' 8 Sept. 1982; Bennett to R.W. Cook, 29 Jan. 1957; see H.V. Nelles, The Politics of Development (Toronto 1974); Bennett interview AEC Records, Secretariat Collection, AEC 378/30, 'Chronology on Canadian

Notes to pages 343-56

38

39 40 41 42 43 44 45

46 47 48 49 50 51

457

Raw Materials,' 14 Aug. 1952. On 9 Aug. 1951 Johnson briefed the AEC on the background to the Eldorado visit, pointing out that 'another refinery capable of producing metal grade oxide would contribute to the security of Canada and the U.S.' It would also conform to 'Canadian industrial policy,' and it would save on transportation costs. DOE Archives, 326 USAEC, Secretariat Collection, AEC 378/5, Dean to Senator McMahon, 16 Sept. 1951; 'Statement by Chairman Dean at hearing before the Joint Committee on Atomic Energy on September 12, 1951'; R- Hewlett and F. Duncan, Atomic Shield (Washington 1972), 483; EP, binder no. i, Bennett to Dean, 20 Oct. 1951 Burger interview, Port Hope, Sept. 1982 Burger interview, Dec. 1981 EP, Executive Committee Minutes, 25 Aug. 1953; 2 Dec. 1953; Bennett to author, Jan. 1983 Bennett to author, Jan. 1983 EP, board minutes, 15 June 1954, 18 May 1955; the new R&D building cost $500,000 Thunaes to author, 12 Nov. 1982 Refinery operations are described in W.M. Gilchrist, 'Submission to the House of Commons Special Committee on Research,' 1961, appendix c, and in a useful series of articles in The Refiner, Eldorado's Port Hope house organ, in 1958 and 1959. See Gilchrist, 'Submission,' appendix c; W. Eggleston, Canada's Nuclear Story (Toronto 1965), 318-9 Frank Drea, 'Fear Radioactivity in Port Hope Area,' Telegram, 10 March 1956 Penny Sanger, Blind Faith (Toronto 1981), 11-4; Burger interview EP, black binder no. 3, Johnson to Bennett, 30 Dec. 1955; board minutes, 27 March 1958; Annual Report for 1956 (Ottawa 1957), 10 EP, Executive Committee Minutes, 26 Nov. 1956; Bennett interview EP, file 'Uranium Sales: Special Price Contracts Correspondence,' Bennett to Plowden, i Dec. 1954 C H A P T E R 10

1 See the comprehensive account of Mackenzie River transportation in Morris Zaslow, 'The Development of the Mackenzie Basin, 1920—1940,' PH D thesis, University of Toronto, 1957, chapter 4 2 EP, Lesslie Thomson, 'Report on Eldorado Mining and Refining,' Feb. 1946; Zaslow,'Development,' 173 3 Kelly Hall interview, Edmonton, April 1982 4 Hall interview; Hunter interview, Edmonton, August 1981

458

Notes to pages 357-75

5 Northern Transportation Company Records, Edmonton, Ed Bolger, 'Report on the Mackenzie River District Transportation System,'July 1948 6 K.J. Rea, The Political Economy of the Canadian North (Toronto 1968), 215 7 PAC, RG 22 (Northern Affairs Records), vol. 247, file 40-2-39(1), L.T. Sayer to Mr Gumming, i Feb. 1943; Charles LaBine to C.W.Jackson, 19 Jan. 1943 8 NT Papers, Bolger report, July 1948 9 EP, Thomson, 'Report,' Feb. 1946 10 Bennett interview, Gilchrist interview 11 NT Records, Bolger report 12 Ibid. 13 PAC, RG 46A, vol. 422, Hearings of the Board of Transport Commissioners for Canada, Edmonton, 30 Jan. 1950 14 Ibid.; David Oancia, 'Supply Lifeline of the Northwest,' Saturday Night (29 Sept. 1956), 15-6 15 NT, board minutes, 17 Jan. 1949 and 5 Dec. 1956 16 NT, Records, reel 11, Inglis to Hunter, 20 Oct. 1952 17 Ibid., Hunter to Broderick, 16 Oct. 1952; Bennett to Hunter, 5 Nov. 1952 18 Ibid., Broderick to Bennett, 6 Aug. 1952; Bennett to Sexsmith, 5 Sept. 1952; Broderick to F. Mancantelli, 30 May 1952 19 NT board minutes, i Feb. 1951, 15 Dec. 1953, 5 Dec. 1956 20 Hunter interview; NT board minutes, 15 Dec. 1954 21 A.W. Currie, Canadian Transportation Economics, 2nd ed. (Toronto 1967), 588-9 22 See Zaslow, 'Development,' chapter 5, for a useful account 23 National Archives, Washington, RG 227, OSRD, s—i, Bush-Conant Papers, folder 73, M.L. Faris to Irvin Stewart, 17 April 1942 24 Alf Caywood interview, Vancouver, Oct. 1981; EP, file 'Aircraft no. i,' Caywood to LaBine, 15 Feb. 1944; Fred T. Smye to C.B. French, 25 Feb. 1944; Frank H. Brown to French, 7 March 1944; K.M. Molson, Pioneering in Canadian Air Transport (Winnipeg 1974), 214 25 EP, file 'Aircraft no. i,' LaBine to L. Thomson, 8 Sept. 1944 26 Caywood interview, Vancouver, 17 Oct. 1981 27 EP, 'Annual Report,' 1947 (mimeo), 7-8 28 Dick Field interview, Saskatoon, 19 Oct. 1981 29 Caywood interview; EP, Annual Report, 1948, 9 30 Caywood interview 31 EP, board minutes, 16 April 1953; J.R.K. Main, Voyageurs of the Air (Ottawa 1967), 250 32 Stephen Piercey, 'Uranium City Fours,' Propliner no. 6 (April—June 1980), 28-99 33 Main, Voyageurs, 249-51; Caywood interview

Notes to pages 380-93

459

INTERLUDE: PEACE 1 R.H. Ferrell, ed., The Eisenhower Diaries (New York 1981), 261-2 2 DEA, file 50219—AC—40, Canadian embassy to secretary of state, 7 Dec. 1953. The embassy's usual contacts in Washington had no idea what would be said, and expressed surprise that Canada had not been consulted. 3 Peter Pringle and James Spigelman, The Nuclear Barons (New York 1981), 122—4, based on material culled from the Eisenhower Library 4 David Holloway, The Soviet Union and the Arms Race (New Haven and London 1983). 37-9

CHAPTER 1 1

1 u.s. Atomic Energy Commission (USAEC), Major Activities in the Atomic Energy Programs (Washington 1962), 168 2 Bennett speech file, speech to Toronto Board of Trade, 24 Jan. 1955 3 EP, file 'Uranium Sales Special Price Contracts,' Bennett to Plowden, draft, i Dec. 1954; see also DEA file 50219—AC—40, Ben Rogers to under secretary, 9 Dec. 1953, noting American repletion and British anxieties 4 EP, black binder no. 3, Bennett to Strauss, 17 May 1955 5 Ibid., Johnson to Bennett, 20 May 1955; Bennett to Johnson, 31 May 1955; Bennett to Johnson, 8 June 1955 6 Ibid., Bennett to Strauss, 30 June 1955 7 DEA Records, file 50219—0-40, Leger to Pearson, 20 July 1955, with enclosure. The subcommittee secretary was William Barton, a diplomat in whom Bennett had particular confidence. 8 EP, black binder no. 3, Bennett, 'Memorandum on Uranium Purchasing Policy,' 22 July 1955; ibid., Howe to Bennett, 22 July 1955 9 Ibid., K.E. Fields, general manager, USAEC, to Bennett, 2 Aug. 1955 10 Johnson interview, 28 Dec. 1982 11 EP, black binder no. 3, Henry to Bennett, 3 Dec. 1955; Bob Hunter interview, 8 Dec. 1982. Hunter was involved in uranium securities in 1955—7. 12 EP, file 'Federal Government Cabinet Uranium Committee,' R.E. Barrett, 'The Elliot Lake Uranium Contracts,' draft no. 2, 29 Dec. 1960; Canada, House of Commons Debates, 2 March 1956 13 EP, file 'Cabinet Uranium Committee,' Barrett, 'Elliot Lake' 14 DEA, file 5O219-AC-4O, Canadian embassy, Washington, to External Affairs, 19 Oct. 1954: 'The United Kingdom representatives were interested only in negotiations for a bilateral "agreement to cooperate" with the Americans...' Bennett and Plowden had first met in Ottawa in 1953.

460

Notes to pages 394-408

15 EP, file 'Uranium Sales: Special Price Contracts,' Plowden to Bennett, 29 Nov. !954 16 Ibid., Bennett to Plowden, i Dec. 1954 17 Ibid., Plowden to Bennett, 4 Dec. 1954 and Bennett to Plowden, 10 Dec. 1954. Clarke saw Bennett on 20 December. Clarke interview, Harwell, Sept. 1981 18 Clarke interview 19 EP, black binder no. 4, Bennett, 'Memorandum on Uranium Purchasing Policy,' 22 Feb. 1956; Bennett to K.E. Fields, 12 March 1956; Jesse Johnson Papers, 'Background of Canadian Negotiations Leading to 68,ooo-Ton Commitment,' 20 Jan. 1958: file 'Uranium Sales - UK,' Bennett to Plowden, 20 April 1956; EP, black binder no.4, Bennett to Johnson, 30 May 1956 20 Ibid., file 'Federal Government: Cabinet Uranium Committee,' R.E. Barrett, 'A History of the Canadian Uranium Programme,' 6 April 1962 21 Ibid. 22 Ibid., Bennett to Plowden, 27 April 1957, and Bennett to Howe, 27 April

1957 23 EP, black binder no. 5, Bennett to Howe, 16 March 1957. 24 Ibid., Plowden to Bennett, 18 April 1957; Bennett to Plowden, 27 April 1957 25 DEAfile50219—AC—40, R.B. Bryce to St-Laurent, 6 Jan. 1954; Bateman to Barton, 13 Jan. 1954 26 Ibid., Canadian embassy to secretary of state, 12 Feb. 1954; External Affairs to Canadian embassy, Washington, 10 March 1954 27 Ibid., Bennett to Barton, 14 June 1954: 'It is difficult to believe that any good purpose would be served by such a conference.' Bennett to author, 17 Feb. 1983 28 Bennett to author, 17 Feb. 1983 29 Bennett interview; Pringle and Spigelman, Nuclear Barons, 165—6. The latter work argues that 'practical evidence' of the capacity to generate nuclearderived electricity was lacking. The experience of the Canadian delegation, at least, was at variance with this assertion. 30 DEA file 14001—2—1, v. 8, Leger to Pearson, i Dec. 1955, enclosing a draft memorandum concurred in by Bennett and Bryce 31 Ibid. 32 Bennett interview 33 DEA files, passim 34 Ibid. 35 Harold L. Nieburg, Nuclear Secrecy and Foreign Policy (Washington 1964), 122-5, deals with the early history of the IAEA. 36 Bertrand Goldschmidt, The Atomic Complex (LaGrange Park, 111. 1982), 279— 81; Goldschmidt interviews, Washington, Nov. 1980, Paris, Sept. 1981

Notes to pages 409—30

461

37 EP, file 'Uranium Sales, United Kingdom Requirements,' Bennett to K.E. Fields, 27 April 1957; Goldschmidt Papers (Paris), Goldschmidt to Bennett, i Feb. 1957 38 Goldschmidt interview 39 EP, file 'Uranium Sales ...,' Bennett to Fields, 27 April 1957 40 Eldorado press release, 13 Dec. 1956 41 Globe and Mail, i May 1957 CHAPTER 12

1 Eldorado board minutes, 27 March 1958; interviews with Bennett and with a board member who wishes to remain anonymous; Gordon Churchill to author, 11 June 1983 2 Eldorado board minutes, 5 and 6 June 1958; Churchill to author, 11 June 1983 3 EP, Eldorado, 'An outline of the world supply and demand for uranium between January ist 1959, and December 3151 1966, the Canadian position and the expected action by the USAEC re the options it holds on Canadian production,' 30 June 1959 4 EP, board minutes, 9 July 1958 5 Ibid., Executive Committee Minutes, 30 Sept. 1958 6 Ibid., board minutes, 30 Oct. and 5 Dec. 1958 7 Ibid., Executive Committee Minutes, 9 Dec. 1958 8 Ibid., board minutes, i Dec. 1960 9 Eldorado, 1959 Annual Report (Ottawa 1960), 10, 16 10 Earle Gray, The Great Uranium Cartel (Toronto 1982), 66; Bennett interviews 11 Bennett interviews; file 'Uranium Sales, United Kingdom Requirements,' vol. 2, R.E. Barrett, 'Notes re meeting with U.K.A.E.A. in Ottawa, May 22nd, 1958' 12 Ibid., file 'Uranium Sales: USAEC Purchasing Policy, no. 2,' W.J. Libby to Gilchrist, 22 Jan. 1959 13 Gray, Uranium Cartel, 59—64 14 See note 3 above 15 EP, file 'Uranium Sales: USAEC Purchasing Policy,' Barrett to Gilchrist, 22 June 1959 16 Ibid., Barrett/Gilchrist, 'The need for two master contracts,'June 1959 17 Ibid., Barrett, 'A History of the Canadian Uranium Program,' 5 April 1962 18 Ibid., Barrett, 'Notes on the Canadian Uranium Program,' Oct. 1981; Churchill to author, 3 Jan. 1984 19 Interview with Lisle and Sheila Jory, Vancouver, 3 Oct. 1982 20 EP, board minutes, i Dec. 1960

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Index

Advisory Panel on Atomic Energy (Canada) 168, 170-2, 199, 242-3, 399 African Metals Corporation 90 Akers, Wallace 118,129-44 Algom Nordic (mine) 328 Algom Quirke (mine) 328 Anderson, H.L. 83 Anderson, Sir John 85, 118, 142, 149-50, 159, 161-2 Athabasca, Lake 278—9,351-2 Atlas-Copco drills 219 atomic bomb, research on 83—91; see also Union of Soviet Socialist Republics, United States, and United Kingdom Atomic Energy Control Board (Canada), AECB 171-2,192—3,199,23940, 242-4, 330-1, 385 Atomic Energy of Canada Limited (AECL) 326, 344, 346-7, 385, 386, 401, 419; see also National Research Council Atoms for Peace 379—81, 384—5, 399-402 Attlee, Clement 159,161-2,379 Auditor General (Canada) 270-1

Austria-Hungary 3—6 Aviation 15-6, 34, 261, 351—2, 36876 Barrett, Richard E. (Dick) 307, 310, 323. 336~9. 393' 40!. 426, 427 Bateman, George 100—1,171—2,173, 176—80, 191, 193, 201, 239, 242—6, 251, 253, 316, 331, 332, 334-5. 340. 385 Bear Exploration and Radium (BEAR) 35-6 Beaverlodge mine: construction of 288-90; discovery of 230—2, 252, 254; Eagle shaft 285, 286; exploration and development 284—7; Fay shaft 286, 319; financing 312,324— 5; geography 279; geology 317-8, 319-20; labour 307; mill 312,3202; mining 286, 288; transport 3656; Verna shaft 319,410 Becker, Cy 35,354 Belec, Joe 218 Bell, Donald (Don) 285-6 Bennett, William J. (Bill) 100, 172; becomes vice-president 182-3; and

464

Index

board of directors 187—8; western trip, 1946 188-9; negotiations with British 193—6; 1947 contract with USAEC 202-4; and Mine Mill (union) 220, 310—i; and sale of radium 2268; and AECB 240, 242—6; search for uranium 248-50; and price formula 250-1,253-4,266-8,333-5; acid leach plant 257-8; USAF airlift 261; relations with federal government 269—75; relations with Saskatchewan government 292-302; tour of USAEC 315-7; Gunnar Mines and 329-33; upgrading refinery 339—45; national uranium policy 341-3; 349-50; as president of NTCL 358; freight rates 361—3; management style 364—5; president of AECL 386; u.s. sales 387ff; UK sales 383ff; on advisory panel 399—400; and International Atomic Energy Agency (IAEA) 400-3; and international safeguards 403; negotiations with France 407-10; proposes privatization 412—14; resigns 415 Bhabha, Homi 404 Bicroft mine 329, 388, 391 Birks, Ray T. 94, 152, 186, 421 Board of Transport Commissioners (Canada) 361—3 Bolger, Ed 75, 102-5, 188—9, 210, 220, 243 Boynton, Harry 218 Briggs, Lyman 88, 90-1, 96, 108 Brintnell, Leigh 21,60 Brockelbank, J.H. 293,300-2 Broderick, Frank 103, 188, 355-6, 358, 362, 364, 367 Brown, Eldon 289-90,306,316,318, 335'420

Brown, Frank 123-5, 151 Bryce, R.B. 389,403,424 Buffam, B.S.W. (Buff) 249, 282, 2847, 289-90, 319-20, 420, 429 Burger, Jack 112,221,228-9,257, 344-5.347.401,421 Burns and Button 289, 305, 307 Bush, Vannevar 91, 97, 122, 142 Byrne, James 311 Byrnes, James F. 179 Cabinet Uranium Committee 389, 424-5, 428 Cadbury, George 283 Cameron Bay 36 Campbell, Douglas (Doug) 218—9 Campbell, M.N. 32-3 Camsell, Charles 13-14, 22, 60, 169 Canada Steamships Limited 364 Canadian Dyno 329, 427 Canadian Pacific Airlines 102, 220, 369-70 Canadian Radium and Uranium Corporation (CRUC) 95, no—11, 153, 225 Catalytic Construction Company 343— 4 Caywood, Alf 369-76 Central Trading Corporation 94 Chalk River See National Research Council and Atomic Energy of Canada Churchill, Gordon 414-17,420,424, 426-8 Churchill, Winston 137-8,142 Churchman, J.W. 300 Clarke, John 395 Climax Molybdenum 330-2 cobalt 60 226—8 Cockcroft, Sir John 401

Index Columbia University 81, go Combined Development Agency (CDA) 242, 245, 385, 394-5, 396 Combined Development Trust (CDT) 162, 169, 174-8, 200, 242 Combined Policy Committee (CPC) 142, 149,162,169,174-81, 245, 263,401 Compton, Arthur 97, 129 Conant, James B. 91, 108, 138, 142 Connell, F.M. 243 Consolidated Denison (mines) 328, 39L427 Consolidated Mining and Smelting (Cominco) 24, 129, 279, 288, 310 Cragg, Shirley 22, 23, 27 crown companies 100,101,181-2, 269-75, 360-1, 431, 434-5 Curie, Marie 4, 35 Curie, Pierre 4 Czechoslovakia 85, 88, 175, 236

465

Diefenbaker, John 273,414-15 Dolan, Vince 322 Donald, Ken 262 Donald, Sylvia 217, 219, 262—3 Douglas, T.C. (Tommy) 281, 283—4 Drew, George 272—3 Duncan, Val 411

Eggleston, Wilfrid 101—2 Egypt 406 Einstein, Albert 87-8 Eisenhower, Dwight D. 379—81,424; character of administration 379-80 Eldorado Aviation Limited 374-6; see also Eldorado Mining and Refining Limited Eldorado Gold Mines Limited: aviation 64; changes name 148; established 17-19; nationalization 123— 7, 148, 149—50, 158; Red Lake mine 19-20; remains in business 19-21; Day, Bernhard 35 stock prices 62-4, 123—5 Dean, Gordon 263—5,315-17,342—3, Eldorado Mining and Refining Lim384, 424 ited 148; and AECB 240, 244; aviaDepartment of External Affairs 159— tion division 369-74; board of dir61, 167, 173, 197, 199 ectors 186—8; budgetary problems Department of Finance 274—5,388—9 152-3, 184-5, 186-7; Commercial Department of Mines (later Mines and Products Division 224-8; contracts Resources) 25; Mineral Resources with USAEC 202-4, 324-5, 329; as Division 25; Mines Branch 25—8, crown company 269—75,431—5; di30-2, 37—8, 57-8, 208—10; Mines versification proposed 413-14; ExBureau 247, 255; Ore Dressing and ploration Division 229-32,242, Metallurgy Division 25-6; Radioac419-21,428-30; financial pressures tivity Division 247—8 343-4; management 186—7, 19&> Department of Munitions and Supply ore-procurement division 336—9, 100 393, 401; police investigate 150-4; Department of Northern Affairs 366privatization of 412—14, 418, 41921,428; profitability 192, 198, 203, 7 Deutsch, John 388-9, 403 277; public ownership and 181-2, Dickins, Punch 375 422-3; relations with Saskatchewan

466

Index

292-302; research and development (Eldorado Project) 208—10,255—8, 338, 344—5, 419;'stretch-out' 4238 Errington, Roy 224-6 Evans, Ernest 113

Gunnar Mines 19,326-8,329-33, 392,427 Gustafson.John 240-1,245-7,250-2

Hall, Kelly 188,355-6,363 Hambro, Sir Charles 178 Hardie, Mervin 362—3 Harris, Walter 389 Faraday mine 329 Farmer, R.H. (Pete) 112-13,115, 221, Haydon, Harry 187-8, 195, 305, 362 Heeney, Arnold 159,167,168 229 Financial Administration Act (1951) Hees, George 427 Henry, Roy 305-7, 332-5, 415-16, 274-5 Financial Post 18,29—30,34,62,74 423 Fines, Clarence 303 Hewston,Jack 355-6 Forward, Frank 287-8, 328 Hirschhorn, Joseph H. 325-6,328, France 404, 407-10, 411 393-4 French, Carl B. 71, 125, 152—3 Hogg, C.A.L. (Vern) 292-3 Frisch, Otto 84, 89 Howe, Clarence Decatur (C.D.) 93, 99-102, 120-3, 157, 159-60, 163, Gaddis, John Lewis 248 167-73, 176-81, 181-4, 191-7, Gaudin, A.M. 188, 206-7, 208-9, 256 199, 238, 244-8, 250, 253, 265-6, Gavsie, Charles 170 269, 272-5, 283-4, 313, 315-17, Geneva Conference (1955) 400—2 341, 358, 361, 370, 379, 386, 389, Geological Survey of Canada 13—14 390-1' 398> 4*2-14, 416, 431-5 Gilchrist, William (Bill) 306-7, 323, Hudson's Bay Company 13, 15, 35, 368, 415-1?. 4i8, 420, 423, 424, 352-4» 359-6o Hughes, Pat 259 426-8 Gillanders, E.B. (Gil) 210, 219, 256-7, Hunter, Bruce 103, 356, 364-5 275, 282, 284-5, 289-90, 295, 299, hydrogen bomb (super-bomb) 236, 246 305-6, 318 Glassco, J. Grant 95, 152-4, 183 Glennan, T. Keith 317 Ignatieff, George 170,172 Goldschmidt, Bertrand 133-4,407-9 IlsleyJ.L. 79 Gordon, Wesley 28 Imperial Oil 14, 15,35,47 India 176,404-6 Gray, Lome 408 Inglis, George 364 Great Bear Lake: climate 11, 40—2; discovery 10; geology 13-14; radi- Ingraham, Vic 36 um rush at 34-6; remoteness 351- International Atomic Energy Agency (IAEA) 399-403, 405-7, 410, 411 2 Groves, General Leslie 108, 128, 137, Ismay, General Hastings 85—6 142, 147, 159, 160, 178-9, 185, 190 isotopes 82-3, 226—8

Index James, William (Bill) 187, 243, 256, 285, 340, 420 Jarvis, Guy 338 Jenkins, Robert (Bob) 214, 218 Joachimsthal (Jachymov) 3-6, 85, 88, 175 Johnson, Jesse 251-2,257-8,265-8, 289, 312, 331, 332, 334-5- 385> 387. 392,425 Joliot-Curie, Frederic 83 Joliot-Curie, Irene 83 Jory, Lisle 429-30 Jory, Sheila 429-30 Joubin, Franc 326

Khrushchev, Nikita 382 King, W.L. Mackenzie 60—1, 98-9, 119—20, 122, 142, 159, 168-9 Klaproth, Martin 3 Knowles, Stanley 246—8 Korean War 236-8, 261-2, 288 LaBine, Charles (Charlie) 16, 17, 22, 23, 29, 39, 55, 75> 93, 354- 358 LaBine, Gilbert 16—20, 27, 28, 29, 39, 62-5, 75, 106-7, 127—8, 130—1, 136—7, 138, 145—6, 157, 189; founds Eldorado, 17—19; in Manitoba 19; discovers pitchblende at Great Bear 20—5; and nationalization 93, 99— 100, 101-2, 120-1, 122—4, 125~6, 149; loses control of Eldorado 1845; and Gunnar 19, 326—8, 329-33; poor relations with Eldorado 329— 3°. S32 LaBine Point See Port Radium Mine labour unions 112—13,220—1,304— 11 Lake, Harold (Hal) 217,261, 276,323, 421,429 Lapointe, Christian (Chris) 208

467

Laurence, George 61, 65 Laytha, Edgar 48—9, 50 Lechien, Gustave 89, 131 Leger, Jules 389,403 Lewis, W.B. 226, 239, 401 Lilienthal, David 236, 263—4 MacAlpine, Colonel 354-5 MacAulay.John 20, 125—6, 183, 186— 7.327.4i6 MacDonald, Malcolm 119,139-40, 149-5°, 157 Macdonnell, J.M. 275 Mackenzie, C.J. (Jack) 100, 120-1, 128, 134-5, 137-4L 149, 152, 1602, l68, 172-3, 226, 239, 244, 368

Mackenzie River 352-3, 356 Macmillan, Harold 398 MacMillan, Viola 392 Makins, Roger 178-9 Maud Committee 89-91 May, Allan Nunn 205 McCone, John 424 McCrea, J.G. 243 McCreary, William 362 McDerment, Robert 222 McNaughton, General A.G.L. 60,166, 171, 172, 173-4, 239, 242-4, 261, 373 McNiven, Jack 429—30 Melvanin, Frank 224 Merritt, Phillip 114, 146, 190, 202-3, 251, 265 Mine, Mill and Smelter Workers' Union 220-1, 308—11 mining See Beaverlodge mine and Port Radium Mine Mitchell, J.S. 222—3, 226 Morrow Seed Company 54, 57 Murphree, E.V 96 Murphy, Gerry 36

468

Index

Murphy, Harvey 310 Murphy, Richard (Dick) 102, 103-6, 188, 210-11, 230 Murray Hill area 144—5

Perrin, Michael 119-20,130,140 Phillips, Percy 58, 67 pitchblende 3 Plewman, W.R. 158 Plowden, Sir Edwin 386-7, 393ff, 400 Nagle, Ted 24, 25 Pochon, Marcel 55—7, 65, 67, 71, 96, Nancarrow, Charles 429 112-13, 125, 133-4, 152, 189, 221, National Radium Trust (UK) 26, 70, 339 Pontecorvo, Bruno 205 73 Port Hope: capacity 348; character 52National Research Council (Canada) 81, 120; Chalk River 226—7 4; health and safety 222—3; metal production 344—6; need for new reNesbitt-LaBine 326 finery 339; pollution 347; reconNichols, Col. Kenneth 137, 147, 148 Northern Aerial Mineral Exploration struction 344; refinery 67,81,112Co. (NAME) 24—5 16, 133—4, 221—4, 228-9 Northern Transportation Company Port Radium Mine 42-52; acid leach plant 257-9; closed 75—6; closure Ltd 35, 64-5, 66-7, 93, 103, 258, 428—30; diminished importance 284; 306; design of barges 353-4; as Elexploration at 419—21; fire 260; dorado subsidiary 366—7, 375—6; health and safety 204—5; manageequipment 355, 359-60, 363; freight ment 210, 217-18; mill 47—8, 207, rates 357,360—3; and Hudson's Bay Co. 359—60; management 358—9; 260; reopened 101-4; reorganization 210-12; security at 261—2; sonavigation 356-7; organization 3556; origin 354; palletization 364; cial life 211-15, 429-30; state of in 1946 188-9; tailings 254, 255—60; profitability 363; and politics 362; public ownership 413, 419; purunions at 220—1 Powell, R.E. (Bert) 188,305,338 chased by Eldorado 354—5 Pregel, Boris 73, 89-90, 94-5, 96-7, North West Company, 11 — 13 107—11, 130-1, 132-3, 140, 145—8, 150-4 Office of Production Management Pronto (mine) 328, 334, 394 (u.s.) 96 Purves, R.A. 20 Organization for Scientific Research and Development (OSRD) 91 Rabi, Isidore 401 Radiore 325 Paneth, F.A. 205 Parsons, C.S. 188, 206, 209, 255, 287- radium: cartel 72-4, 76—7; extraction of 4—5,58—9; in medicine 5; in On8,321 tario 26,61-2, 68—70; at Port Hope Pearson, Lester B. (Mike) 160, 161, 59—60, 224, 228; price of 8—9, 71 — 167, 170, 176-9, 183, 328, 379, 389, 4; production ceases 228; sales 95, 404, 422 224-7; and Union Miniere 7—9; in Peet, Tiny 67 United Kingdom 26 Peierls, R.E. 89

Index Reid, Fraser 46-7, 62, 63, 75-6, 102, 186, 327 Rio Tinto 394, 411, 427 Rix-Athabasca 325-6, 334 Robertson, Norman 159 Ross, A.H. (Al) 112,195,221-4,276, 287, 328, 332, 339-40 Rutherford, Ernest 82, 83 Ryan.J.P. 51 safeguards on end-use 4O3ff, 432 St-Laurent, L.S. 99, 238, 379, 389, 398,413-14 St Paul, E.G. 22-3, 27, 157 Saskatchewan 279—81; government of 290-2; relations with Eldorado 282-4 Scully, V.W. (Bill) 167, 172 security 158-9 Sellar, Watson 270-1 Sengier, Edgar 86-7, 89, 94, no, 131, 203-4 Sexsmith, Robert 289-90, 299, 305-6 Sharp, Mitchell 167 Snyder, Harry 48, 65-6, 71—3, 74 Soddy, Frederick 82—3 Solandt, Omond 170 Spence, Hugh 27,30,46,61 Spice, Ted 217,261,275,429 Stalin, Joseph 235-6,379 Standard Chemical Corporation 6—7 Strath, William (Bill) 423 Strauss, Lewis 248, 384-5, 387,388, 396,400-1,424 stretch-out 423-8 Sweden 175—6 Szilard, Leo 83-4, 87-8

469

Thomson, Lesslie 140,143,144,1504, 186, 189, 206, 222, 358 Thunaes, Arvid 208-9, 229, 255, 257, 276, 287-8, 338, 344-5, 401 Tizard, Sir Henry 86 Truman, Harry S. 159, 161-2, 200, 236, 238 tube alloys See United Kingdom and atomic bomb Tweedsmuir, Lord 48, 60-1

Union Miniere du Haut-Katanga 7-9, 37-8, 68, 70-1, 72-4, 76-7, 86-7, 89-90, 110-12, 130, 191, 200, 2014> 245' 433-4 Union of South Africa 175, 203 Union of Soviet Socialist Republics (USSR) 165,175,235-6,382,401-2, 406 United Kingdom 70; and atomic bomb 85-91, 116, 237-8; and Eldorado 116—23, 127—44! Montreal laboratory 129, 132—3; relations with Manhattan Project 131-3; and CDT 176—80; negotiations with Eldorado 193-6, 393ff; Howe's opinion of 195—6; overtures from Saskatchewan 283-4; work on solvent extraction 339; foreign policy 379— 80; Atomic Energy Authority 393ff, 427; i2,ooo-ton contract 398—9, 423ff; and IAEA 401 United Nations 380 United Nations Atomic Energy Commission (UNAEC) 163,166-7,170—1, !73-4> 197 United Nations Relief and Rehabilitation Agency (UNRRA) 225 United States: radium and 6-7, 70, Teller, Edward 88 226; atomic bomb and 87-8, 90—1, Thatcher, Ross 272 235,311-12,379-80,382,397; Army Thomson, G.P. 85, 89, 119, 123, 138 Corps of Engineers 106, 108-9; con-

4?o

Index

tracts with Eldorado 109—11, 114— 15,128,132-3,141,150-4; demand for uranium 158,232,263-4,31112, 381-2; and Cold War 165—6, 379-80; Atomic Energy Commission (AEC) 171,200,232,237,3835; Raw Materials Division 240-2, 245-6, 250-4, 265-8, 289, 312-14, 329, 338, 387ff, 417; Howe's tour of 315—17; parallel contracts with Eldorado 329, 387ff; insistence on higher grade product 339-45; domestic production of uranium 203, 385; and IAEA 399-403 uranium: abundance 336-7,382,385, 410; Canadian requirements 386; in ceramics 3; discovery of 3; experiments in 19305 81—91; glut 417; international safeguards 403; metal 268, 344; military applications 8591; national policy 341, 349-50, 383—4; opened to prospecting 245— 8; price 193-6,202—4,245-6,24950, 333—6; private companies and 249—50; radioactivity 4; reserved to

federal government 148-9; scarcity 175—6, 200—i, 263; stretch-out 423-8 Uranium City 293—304, 327, 428 Ventures Limited 145 Walli, Emil 45, 50, 326 Walli, Virginia 50 Washington Conference (November 1945) 161-3 Watt, F.B. 42 Way, Russell 287, 289-90, 305—6 Wells, H.G. 83 Wells, Thomas L. 338 White Eagle Silver Mines 354-5 Wigner, Eugene 84 Williams, Charles (Charlie) 187, 257, 261, 271, 306, 316 Wilson, Carroll 252, 264, 330-1 Winters, Robert 422 Woods worth, J.S. 33 Wrong, H. Hume 159-61, 167-70, 183