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PLAINTIFF'S EXHIBIT
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RECEIVED
APR 71982
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New York Office Office of the Secretary
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April 2, 1982
Mr. W. R. Kelly:
The following appropriation was approved at the Advisory Committee meeting held March 24, 1982:
El Paso New York No. 5657
Plant No. 677
Enlarged Converter Shell. Replacement.
$ 950,000
FJG:dap Enc. cc: A. L.
F. R. W. A. W. T. A. O.
Labbe/L. C. Travis McAllister - w/enc. Bennis - w/enc. Sweat Marsh, Jr.
F. i/T^oldthwait Assistant Secretary
w/enc.
ASARCO ELP 0006497
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Mr. Lee C. Travis, General Manager Western Department New York, N. Y.
February 9, 1982 El Paso, Texas
APPLICATION FOR PROPERTY APPROPRIATION CONVERTER SHELL
EL PASO PLANT NO. 677 - $950,000
The No. 1 converter at El Paso was installed in 1913. In 1955 the converter was com pletely re-bricked. However, in the 70 years since installation, numerous burn-outs and hot spots have warped the shell and weakened it to such an extent that it is start ing to bow in the center of the converter.
The condition of the shell is such that there is a large substantial difference in the elevation of the tuyeres which makes it extremely difficult to punch with the automatic puncher. Plates have been rolled and scabbed in various spots in an attempt to strengthen it but have been unsuccessful in maintaining the configuration of the converter.
The El Paso Plant uses three converters in order to obtain the maximum converter capacity of having two in the stack at one time. Experience has taught us that a tuyere line lasts 10 or 11 months, which means either three or four tuyere line repairs a year. With only two converters available, this would mean that during the course of a year, 30-35 con verter days would be lost during tuyere line repairs which would greatly restrict the production in the Copper Department.
In addition, a new shell would eanble the operators to get a better seal between the converter shell and the hood, which.would greatly reduce the leakage and restrict the amount of flow going to the acid plant, as well as increasing the steam flow in the con verter boilers.
The installation of a 35-foot converter will enable the Plant to produce a converter charge that will make one anode charge instead of requiring two converter charges to fill the anode. By filling the anode completely with one converter charge, the tempera ture of the copper will remain higher enabling the refiners to skim the anode furnace cleaner and to produce anodes faster. In addition, there will be less downtime for turn arounds because of the larger converter.
By placing the order for the shell in early 1982, the delivery will be some time after September 1982, and the payments required on the construction of the shell would not be due until the summer of 1982.
I request approval of this appropriation in order that the productivity of the Copper Department will remain.
WRK: gp Endscc: W. T. Sweat - Ends.
W. R. KELLY
ASARCO ELP 0006498
REQUEST FOR CAPITAL APPROPRIATION FORM 302
C Mew Request | X | ^
Supplemental Request [
Scope Change
[
I. DESCRIPTION OF PROPOSAL AND REASONS FOR MAKING REQUEST:
#1 Converter Shell
N. pp. or Supp. No_____ S657
Plant App. No._______677 _________ Plant or Unit Name ^ Paso Plant
Unit No7819___________________________ DateFebruary 9, 1982
II. ADVANTAGES TO BE DERIVED FROM ADOPTION OF THE PROPOSAL:
Replacement of a converter shell that has been installed since 1913 with a larger converter enabling the Plant to produce copper faster.
III. ESTIMATED EXPENDITURES: Current Request
Capital Expenditures S950,000 Working Capital Capitalized Interest Other Expenditures
Total '$950,000
Appropriations Previous
$
$
Total $ 950,000
$ 950,000
'TOTAL AMOUNT REQUESTED WITH THIS APPROPRIATION
IV. EVALUATION OF PROPOSAL
Internal Rate of Return: Excluding Tax Credits
\3o) _%
Including Tax Credtl^JS) (~3'3~) %
Estimated Useful Life. 20
Start Date. March 1, 1982 Completion Date December 31. 1982 Previously Forecasted? $750,000 Available Investment Tax Credit $95.000
Available Energy Tax Credit $_______ --
V. APPROVAL AND REVIEW SIGNATURES:
Nature of Current Request: Maintenance $950,000 Legislative New Project Automobiles
Total s950.000
Approved by Advisory Committee:
M&R 2 4 1.9R?
Reviewed by -- Reviewed by-- Charge to Accts..
Treasurer Controller
Approved by Board of Directors:
Secretary: Date:
ASARCO ELP 0006499
COST DISTRIBUTION Form 302 A **
N.Y p. or Supp. No______________ >5V
Plam App, No_________ 677
__________
Plant or Unit Name
El Paso Plant
Unit No7819
_______
DateFphruary q1 iqa?
l. project description:
#1 Converter Shell----------------------------Years (1)
Lives 20
Amounts '$950,000
:
Non-dopreciable Total
5950,000
Note (1): If project expenditures extend beyond five years, use additional pages and show entire cost distribution by year.
R. L. Vollmer Prepared by
2/9/82 Dato
ASARCO ELP 0006500
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ASARCO ELP 0006501
INTERNAL RATE OF RETURN WORKSHEET Form 302 C
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I. project description:________ #1 Converter Shell
N.Y o. or Supp. No..__________
Plarn pp. No.______ 677
__________
Plant or Unit Name FI Pacn Plant
Unit No7819 DateFebruary 9, 1982
II. CALCULATION: Check One:
X | Excluding Tax Credits [ [ Including Tax Credits
Form 302 B
Estimated (1) Year Expenditures
0 $(950,000) 1
2
3
4
5
6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Totals
(950,000 (2)
)
Form 302 A Less
Capitalized Interest
(2)
Form 302 B
Net Cash Expenditures
Cash Proceeds
$(950,000) $ 65,550 96.140 91.770
91.770 91,770
(950,000 ) $ 437,000
Net Cash Flow
$(884,450) 96.140 91.770 91.770 91,770
$(513,000)
Discount Factor
1.000 1.380 1.904 2.628 3.627
CO CO
Present Value $(884,450) 132.673 174.767 241.178 332,826
(3,006) (3)
Notes: (1) I! project lite extends beyond 20 years use additional forms. For calculation purposes the first year of the project should be regarded as year 0 with a 1.000 discount factor.
(2) Must agree with form 302 and for calculation purposes show all expenditures as negative numbers.
(3) The sum of all annual present valuo numbers is the net present value, which should be as close to zero as possible. The interest rate at which the net present value is zero is deimed as the internal rate of return.
ASARCO ELP 0006502
INTERNAL RATE OF RETURN WORKSHEET Form 302 C
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I. PROJECT DESCRIPTION:_______________ #1 Converter Shell
N.Y. . or Supp. No___ Plant Mpp. No._____ 677
Plant or Unit Name, El Paso Plant. Unit No__________ 7819 Date____________ February 9, 1982
II. CALCULATION: Check One:
|
| Excluding Tax Credits
| y | Including Tax Credits
(1) Year
0 1 2 3
4
5
Form 302 B
Estimated Expenditures
S(950.000)
Form 302 A
Form 302 B
Capitalized Interest
Net Cash Expenditures
Cash Proceeds
5(950.000) 5 160.550 96,140
91,770 91,770 91.770
Net Cash Flow
5(789.450) 96,140
91,770
91.770 91.770
Discount^ jw/
(33)0/0
Present Value
1.000 1.330
5(789.450) 127,866
1.769
162,332
2.353 3.129
215,901 287.149
.6 7
8
9
.10
11
' 12 13
14
15
16
17
18
19
20
Totals (950,000 )
(950,000 ) $ 532,000
$(418,000)
(2) (2)
$ 3,798 (3)
Noles: (.1) If project life extends beyond 20 years use addiiional forms. For calculation purposes the first year of the project should be regarded as year 0 wilh a 1.000 discount lactor.
(2) Must agree with form 302 and for calculation purposes show all expenditures as negative numbers.
(3) The sum of all annual present value numbers is the net present value, which should be as close to zero as possible. The interest rate at which the net present value is zero is defined as the internal rate of return.
ASARCO ELP 0006503
COST ESTIMATE
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ASARCO ELP 0006504-
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ASARCO ELP 0006505