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Tears & Profit. Last week Beynon wept openly as he told Congressmen how Freeport had pried into his personal life. Said he: "The contract under which we are buying ore from Freeport is unconscionable, and I am going to do everything I can do to remedy this situation. These kinds of deals destroy confidence."
In rebuttal, Freeport argued that it had opened up the ore supply, run the Nicaro plant for the U.S. in World War II, and developed many nickel-production techniques that the Government now uses. But it also profited. Freeport has collected $13.7 million in Nicaro royalties from the Government since 1952, now gets about $3,500,000 per year. More than that, the Government last year made it possible for Freeport to get financing for a huge $119 million nickel-and-cobalt operation, abuilding at Moa Bay, Cuba, near Nicaro. The U.S. did so by signing a contract, which the committee is also investigating, to buy up to 271 million Ibs. of Freeport's Moa Bay nickel at 74¢ per Ib. and 23,835,000 lbs. of cobalt at $2 per Ib. Since then, the nickel market has suddenly softened.
As for the Nicaro deal with Freeport, the Government next month will complete a 15-mile railroad from the Nicaro plant to a Government-owned mine that holds 43 million tons of nickel ore, enough to supply the nickel plant for 17 years. The Government can then cancel its royalty contract with Freeport on six months' notice, and it probably will do so unless Freeport slices the price. In any case, the U.S. will be able to supply Nicaro from its own sources, or sell the Nicaro plant. At least two companies are interested: National Lead and Freeport itself.