The New Uranium King

Joseph H. Hirshhorn is a fast-talking cigar-chewing promoter from Brooklyn who quit school at 14 to support his mother, was a millionaire at 29 and now, at 55 says he hasn't the faintest idea how much he is worth. "After the first million," explains Hirshhorn, "unless a man loves money, it's all meaningless." Last week Promoter Hirshhorn signed a multimillion-dollar agreement that had plenty of meaning, as well as money, for him. The deal will make him the No. 1 uranium producer of Canada, if not the world.

The deal involved Algom Uranium Mines, Ltd., a company controlled by Hirshhorn and associates, which for two years has been developing rich uranium claims in a 3O-mile-square tract of land in Canada's Blind River summer-resort area, just north of Lake Huron. Under the deal a group of international mining and financial interests, headed by Britain's Rio Tinto Co., Ltd. (whose chairman is the

Earl of Bessborough, onetime Governor General of Canada), will put up $57.6 million through stock purchases and loans. With the money Algom will build two uranium processing mills at Quirke Lake and Nordic Lake by 1956, each with a capacity of 3,000 tons a day.

All of Algom's production will go to the Canadian government. Last week the company announced that it had won a contract to sell $207 million worth of uranium to the government by Dec. 31, 1961, almost three times the amount of the contract given Gunnar Gold Mines, the biggest current potential producer.

Lawyers in the Bush. Long before Joe Hirshhorn got interested in the Blind River area, geologists knew that there was radioactivity there. But most thought it came from thorium, because the outcrops yielded little uranium ore. Geologist Franc R. Joubin, who was working as a private consultant in the area, thought differently; he believed that oxidation of the outcrops had leached away their uranium content, but that underneath there lay a treasure trove of uranium ore. Joubin told Joe Hirshhorn his theory, and Hirshhorn agreed, with associates, to put up $30,000 in 1953 to take core samples in the area. The cores proved Joubin right. The uranium deposit lay in a body extending 30 miles northward to Quirke Lake (see map). But since the discovery lay close to Canada's well-traveled Highway 17, and to the tracks of the Canadian Pacific, Hirshhorn would have to stake his claims in a hurry before the word got out.

He decided to do it through Preston East Dome Mines, a gold-mining company 20% owned by him. Preston flew a staking crew of 75 men with equipment into the Blind River area, even brought in lawyers to draw up the necessary claim and transfer papers on the spot. After seven weeks Hirshhorn and Preston Dome filed 1,400 claims to 56,000 acres, and set off a rush that brought 8,000 claims from other prospectors. To develop the claims on the south end of their property. Hirshhorn & Co. set up Pronto Uranium Mines, and landed a $55 million government contract. To develop the northern claims, they set up Algom, of which Hirshhorn owns a million shares (36%), Preston East Dome 1,250,000 (45%), Hirshhorn's friends another 100,000. and the public only 400,000 shares. Last week, with Algom stock selling at around $16, Hirsh horn's direct and indirect holdings were worth about $20 million on paper.

Cash Before the Crash. Hirshhorn, who got his start as a Wall Street market tipster and trader, got out of the market with $4,000,000 just before the 1929 crash. For more than 20 years he has commuted between Manhattan and Toronto, has set up a string of more than two dozen Canadian mining and oil companies. In 1950 New York State's Attorney General Goldstein warned investors against buying shares in American-Canadian Uranium Co., which was backed by Pax Athabasca Uranium Mines. Ltd., a Hirshhorn interest (TIME, Dec. 4, 1950), because the promoters were making too much.

Hirshhorn's new $207 million deal with the Canadian government amounts to a cost-plus contract. Unlike most other producing uranium properties in Canada, which are so remote that supplies must be flown in at tremendous cost, the Algom property has access to good transportation. Miners guess it will cost Hirshhorn less than $10 a ton to get the Algom ore out, and the government is reported to be paying between $18 and $20 a ton for it. Estimated profit to Algom under the contract: $100 million. And that, says Hirshhorn, is only the beginning: "We're thinking in terms of 50 or 60 years. Our indicated reserves are worth between $2 billion and $3 billion. I'm just sittin' on eggs, waitin' for them to hatch."

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