Part XV--Proposed New Industry Structure for Oil and Gas Extraction; Mining, except Oil and Gas; Support Activities for Mining Section A-- Structure NORTH AMERICAN INDUSTRY CLASSIFICATION SYSTEM (NAICS) Agreement Number 26 This Document represents the proposed agreement on the structure of the North American Industry Classification System (NAICS) for the following industries: Oil and Gas Extraction Mining, Except Oil and Gas Support Activities for Mining The detailed NAICS structure along with a brief description of the structure is attached (Attachments 1 and 2). Each country agrees to release a copy of the proposed NAICS structure to interested data users. Comments received will be shared among the countries and additional discussions will be held before a final decision on the structure is made. Each country may add additional detailed industries, below the 4-digit level of NAICS, as necessary to meet national needs, so long as this additional detail aggregates to a 4-digit NAICS level in order to ensure full comparability among the three countries. This NAICS structure was presented and provisionally accepted at the NAICS Committee meeting held on November 8 and November 9, 1995 in Washington, D.C. Accepted Signature Date Canada /S/ Jacob Ryten 11/9/95 Mexico /S/ Enrique Ordaz 11/9/95 United States /S/ Jack E. Triplett 11/9/95 ATTACHMENT 1-- NAICS STRUCTURE XX Oil and Gas Extraction XXX Oil and Gas Extraction XXXX Oil and Gas Extraction XX Mining, Except Oil and Gas XXX Coal Mining XXXX Coal Mining XXX Metal Ore Mining XXXX Iron Mining XXXX Gold and Silver Mining XXXX Copper, Nickel, Lead, and Zinc Mining XXXX Other Metal Ore Mining XXX Non-Metallic Mineral Mining and Quarrying XXXX Stone Mining and Quarrying XXXX Sand, Gravel, Clay, Ceramic, and Refractory Mineral Mining and Quarrying XXXX Other Non Metallic Mineral Mining and Quarrying XX Support Activities for Mining XXX Support Activities for Mining XXXX Support Activities for Mining Attachment 2--North American Industry Classification System Draft Classification for: Mining Representatives of the statistical agencies of Canada, Mexico, and the United States agree to a draft industry classification for these industries. This draft classification applies to the sector Mining. This sector is subdivided into three subsectors and five industry groups: Oil and Gas Extraction, Coal Mining, Metal Ore Mining, Non-Metallic Mineral Mining and Quarrying, and Support Activities for Mining. The five industry groups are subdivided into 10 industries. A General Outline The Mining sector includes the extraction of liquids and gases such as petroleum and natural gas by the operation of wells and the extraction of naturally occurring minerals through underground or surface mining. Also included is the beneficiating of the ores by crushing, grinding, washing, drying, leaching, and other means. The sector is divided into three subsectors, two being based on the types of minerals extracted and beneficiated and one being support activities for the extraction. The existing industry classifications of Canada, Mexico, and the United States were remarkably similar in their overall structure for mining. There were significant differences in the classifications at the detailed level, as the detailed level varied because of the specific mineral deposits that were significant to each country. The existing classifications were for the most part inherently production oriented and satisfactory to data users. The structure maximizes the comparability between the three countries and makes modest enhancements to the production orientation of the classification. Limitations and Constraints of the Classification The extraction of any mineral is conditional on the presence of a suitable mineral deposit. Generally, the extraction method varies according to the type of deposit mined as does the beneficiating process. An approach that distinguished surface and underground mining as a basis for defining industry groups was considered but in the case of many metals and non-metals the activity in each was too small to permit separation. On the other hand the difference in the beneficiating processes (agglomerating, crushing, chemical, leaching etc.) required for different ores provided the basis for distinguishing production processes. The type of mineral deposit was therefore considered to be a good proxy for the production process in most cases of metal mining. However, these deposits vary significantly among the three countries. For many types of minerals the number of deposits in any one country may be too small to permit publishing data on that industry for that country. This limited the number of possible industries. The industries are therefore based on the type of minerals that generally occur together in a mineral deposit in all three countries. For example, the occurrence of combinations of copper, lead, zinc and nickel in the same mineral deposit is common among the three countries. In the case of non-metal mining, the quarrying of stone, above ground, requires precision cutting of large blocks of stone which is a process very different from the process of extracting sand, gravel, clay, ceramic and refractory minerals. Relationship to ISIC Most 4-digit industries in this sector are contained within Divisions 10-14, Mining and Quarrying, of the current International Standard Industrial Classification of all Economic Activities (ISIC Revision 3) of the United Nations. Generally, the industries can be reaggregated to the ISIC divisions. However, there are some differences: ISIC includes peat with coal in Division 10, Mining of Coal and Lignite, Extraction of Peat, whereas peat extraction is included in NAICS industry Non Metallic Mineral Mining and Quarrying. Although peat is similar to coal in that it can be used as a fuel, the extraction and beneficiating processes are distinctly different from coal and are similar to the processes involved with non metallic minerals. It should be noted that in North America peat is seldom used as fuel but rather as a soil conditioner. ISIC Division 12, Mining of Uranium and Thorium Ores, is not supportable as a NAICS industry. Some Changes to the National Classifications For Canada, CSIC 0611, Gold Mines, has been combined with the silver part of CSIC 0614, Silver-Lead-Zinc Mines, to form the NAICS four digit industry Gold and Silver Mining. Gold mining and silver mining are separated at the national five digit level. Silver mining becomes a null set as it does not exist in Canada. Silver is mined only as a by product of lead and zinc mining in Canada. CSIC 0612, Copper and Copper-Zinc Mines, has been combined with CSIC 0613, Nickel-Copper Mines, plus the lead and zinc part of CSIC 0614 to form NAICS industry Copper, Nickel, Lead, and Zinc Mining. CSIC 0615, Molybdenum Mines, was combined with CSIC 0616, Uranium Mines, and CSIC 0619, Other Metal Mines, to form NAICS Other Metal Mining. CSIC 0811, Granite Quarries; CSIC 0812, Limestone Quarries; CSIC 0813, Marble Quarries; and CSIC 0814, Sandstone Quarries, becomes NAICS industry Mining and Quarrying of Stone. However these 4 digit industries are restored for national detail. CSIC 0821, Sand and Gravel Pits, has been combined with CSIC 0815, Shale Quarries, and the crude clays from clay pits part of CSIC 3511, Clay Products, to form NAICS industry Sand, Gravel, Clay, Ceramic and Refractory Mineral Mining and Quarrying. However, CSIC 0821, Sand and Gravel Pits, is restored at the level of national detail. There are no known establishments primarily engaged in extracting clay in Canada, although extraction of clay exists by the manufacturers of clay products. For Mexico, peat mining has been split from CMAP 210000, Mining and /or Beneficiation of Coal, to be included in NAICS industry Non Metallic Mineral Mining and Quarrying. The remaining portion of CMAP 21000 is equivalent to NAICS industry Coal Mining. Peat extraction is of little statistical significance in Mexico. For Mexico, the nickel part of CMAP 232006, Mining and /or Beneficiation of Other Nonferrous Metallic Ores, has been split out. This split will have little statistical impact as there is only a very small amount of nickel mining in Mexico. The split is combined with CMAP 232003, Mining and /or Beneficiation of Industrial Ore with a High Lead and Zinc Content, and CMAP 232005, Mining and /or Beneficiation of Ore with a High Copper Content, to form the NAICS four digit industry Copper, Nickel, Lead, and Zinc Mining. The creation of the Support Activities for Mining subsector in is an important change for Mexico, since such activities are not represented in the Mexican classification. However, the coverage of the mining sector is very close to the current mining sector in CMAP. For the United States, a structural change involved moving the support activity industries from their respective 1987 SIC Major Groups and bringing them all together in the NAICS structure under the subsector Support Activities for Mining. The nickel ore mining part of 1987 SIC 1061, Ferroalloy Ores, Except Vanadium, has been combined with 1987 SIC 1021, Copper Ores, at the national level. This has a small statistical impact as production is relatively insignificant. This national level industry plus 1987 SIC 1031, Lead and Zinc Ores, also maintained at the national level, form NAICS industry Copper, Nickel, Lead, and Zinc Mining. The bituminous limestone and bituminous sandstone part of 1987 SIC 1499, Miscellaneous Nonmetallic Minerals, Except Fuels, is moved out of Non Metallic Minerals Mining to NAICS industry Mining and Quarrying of Stone. Achievement of Objectives The classification meets the objectives for the North American Industry Classification System (NAICS). It includes industries that group establishments with similar production processes, that is, it applies the production-oriented economic concept. In the main, the hierarchical structure of the classification also follows the production concept. Other objectives of the project are not as relevant in this area of the classification as in others. These objectives are the delineation of new and emerging industries, service industries and industries engaged in the production of advanced technologies. The industrial sector in question is relatively mature and uses relatively stable technology for extraction. The industries are highly specialized, and they are economically significant. Disruptions to time series are minimal. The classification achieves comparability for the three participating countries. All countries agree on the detailed definitions of the industries. Section B-Annex: United States National Industry Detail As explained in the Structure presentation of this notice, for a number of reasons 4-digit industries in the three NAICS industry subsectors presented in Part XV, Section A--Attachment 1, contain less detail than is currently in the U.S. SIC system, and less detail than is required to meet important analytical requirements in the U.S. The three country agreement on NAICS envisions that each country may develop national detailed industries below the NAICS industry level, so long as the national detail can be aggregated to the classification, thus assuring full North American comparability. The ECPC is proposing U.S. 5-digit industry detail for the three NAICS industry subsectors covered in Part XV of this notice. For cases where no 5-digit detail is shown, the ECPC is proposing that the NAICS 4-digit industries will also represent the most detailed U.S. industries. TABLE 1 The definitions of status codes are as follows: E-existing industry; N-new industry R-revised industry; and * means "part of". The abbreviation NEC is used for Not Elsewhere Classified. 1997 NAICS and U.S. description Status code 1987 SIC code 1987 SIC description XX Oil and Gas Extraction XXX Oil and Gas Extraction XXXX Oil and Gas Extraction XXXXX Crude Petroleum and Natural Gas Extraction E 1311 Crude Petroleum and Natural Gas XXXXX Natural Gas Liquid Extraction E 1321 Natural Gas Liquids XX Mining except Oil and Gas XXX Coal Mining XXXX Coal Mining XXXXX Bituminous Coal and Lignite Surface Mining E 1221 Bituminous Coal and Lignite Surface Mining XXXXX Bituminous Coal Underground Mining E 1222 Bituminous Coal Underground Mining XXXXX Anthracite Mining E 1231 Anthracite Mining XXX Metal Ore Mining XXXX Iron Mining E 1011 Iron Ores XXXX Gold and Silver Mining XXXXX Gold Mining E 1041 Gold Ores XXXXX Silver Mining E 1044 Silver Ores XXXX Copper, Nickel, Lead and Zinc Mining XXXXX Copper and Nickel Mining R 1021 Copper Ores *1061 Ferroally Ores, Except Vanadium (nickel) XXXXX Lead and Zinc Mining E 1031 Lead and Zinc Ores XXXX Other Metal Ore Mining XXXXX Uranium-Radium-Vanadium Ores Mining E 1094 Uranium-Radium-Vanadium Ores XXXXX Other Metal Ore Mining R *1061 Ferroally Ores, Except Vanadium (other ferroalloys except nickel) 1099 Miscellaneous Metal Ores, NEC XXX Non-Metallic Mineral Mining and Quarrying XXXX Stone, Mining and Quarrying XXXXX Dimension Stone Mining and Quarrying E 1411 Dimension Stone XXXXX Crushed and Broken Limestone Mining and Quarrying E 1422 Crushed and Broken Limestone XXXXX Crushed and Broken Granite Mining and Quarrying E 1423 Crushed and Broken Granite XXXXX Other Crushed and Broken Stone Mining and Quarrying R 1429 Crushed and Broken Stone, NEC *1499 Miscellaneous Nonmetallic Minerals, Except Fuels (bituminous limestone and bituminous sandstone) XXXX Sand, Gravel, Clay, Ceramic and Refractory Mineral Mining and Quarrying XXXXX Construction Sand and Gravel Mining E 1442 Construction Sand and Gravel XXXXX Industrial Sand Mining E 1446 Industrial Sand XXXXX Kaolin and Ball Clay Mining E 1455 Kaolin and Ball Clay XXXXX Clay, Ceramic, and Refractory Mineral Mining E 1459 Clay, Ceramic, and Refractory Minerals, NEC XXXX Other Non-Metallic Mineral Mining and Quarrying XXXXX Potash, Soda, and Borate Mineral mining E 1474 Potash, Soda, and Borate Minerals XXXXX Phosphate Rock Mining E 1475 Phosphate Rock XXXXX Other Chemical and Fertilizer Mineral Mining E 1479 Chemical and Fertilizer Mineral Mining, NEC XXXXX All Other Non-Metallic Mineral Mining R *1499 Miscellaneous Non-Metallic Minerals, Except Fuels (except bituminous limestone and bituminous sandstone) XX Support Activities for Mining XXX Support Activities for Mining XXXX Support Activities for Mining XXXXX Support Activities for Metal Mining E 1081 Metal Mining Services XXXXX Support Activities for Coal Mining E 1241 Coal Mining Services XXXXX Drilling Oil and Gas Wells E 1381 Drilling Oil and Gas Wells XXXXX Support Activities for Oil and Gas Field Exploration E 1382 Oil and Gas Field Exploration Services XXXXX Other Oil and Gas Field Support Activities E 1389 Oil and Gas Field Services, NEC XXXXX Support Activities for Non-Metallic Minerals Except Fuels E 1481 Non-Metallic Minerals Services, Except Fuels TABLE 2 The abbreviation "pt" means "part of". @ means time series break has been created that is greater than 3% of the 1992 revenues for the 1987 SIC industry. 1987 SIC code 1987 SIC description 1997 U.S. description 1011 Iron Ores Iron Ore Mining 1021 Copper Ores Copper Mining 1031 Lead and Zinc Ores Lead and Zinc Mining 1041 Gold Ores Gold Mining 1044 Silver Ores Silver Mining 1061 Ferroalloy Ores, Except Vanadium Nickel Ore Mining Copper and Nickel Mining (pt) Other Ferroalloys Other Metal Ore Mining (pt) 1081 Metal Mining Services Support Activities for Metal Mining 1094 Uranium-Radium-Vanadium Ores Uranium-Radium-Vanadium Ore Mining 1099 Miscellaneous Metal Ores, NEC Other Metal Ore Mining (pt) 1221 Bituminous Coal and Lignite Surface Mining Bituminous Coal and Lignite Surface Mining 1222 Bituminous Coal Underground Mining Bituminous Coal Underground Mining 1231 Anthracite Mining Anthracite Mining 1241 Coal Mining Services Support Activities for Coal Mining 1311 Crude Petroleum and Natural Gas Crude Petroleum and Natural Gas Extraction 1321 Natural Gas Liquids Natural Gas Liquid Extraction 1381 Drilling Oil and Gas Wells Drilling Oil and Gas Wells 1382 Oil and Gas Field Exploration Services Support Activities for Oil and Gas Field Exploration 1389 Oil and Gas Field Services, NEC Other Oil and Gas Field Support Activities 1411 Dimension Stone Dimension Stone Mining or Quarry 1422 Crushed and Broken Limestone Crushed and Broken Limestone Mining or Quarrying 1423 Crushed and Broken Granite Crushed and Broken Granite Mining or Quarrying 1429 Crushed and Broken Stone, NEC Other Crushed and Broken Stone Mining or Quarrying (pt) 1442 Construction Sand and Gravel Construction Sand and Gravel Mining 1446 Industrial Sand Industrial Sand Mining 1455 Kaolin and Ball Clay Kaolin and Ball Clay Mining 1459 Clay, Ceramic, and Refractory Minerals, NEC Clay, Ceramic, and Refractory Mineral Mining 1474 Potash, Soda, and Borate Minerals Potash, Soda, and Borate Mineral Mining 1475 Phosphate Rock Phosphate Rock Mining 1479 Chemical and Fertilizer Mineral Mining, NEC Other Chemical and Fertilizer Mineral Mining 1481 Non-Metallic Mineral Services, Except Fuels Support Activities for Non-Metallic Minerals, Except Fuels 1499 Miscellaneous Non-Metallic Minerals, Except Fuels Bituminous Limestone and Bituminous Sandstone Except Bituminous Limestone and Bituminous Sandstone Other Crushed and Broken Stone Mining or Quarrying (pt) All Other Non-Metallic Mineral Mining Description of Changes to the U.S. System There were no new industries added to the 1997 industry structure for this industry sector. Oil and Gas Extraction - All oil and gas field services (1987 SIC's 1381, 1382, 1389) were transferred to the new 1997 subsector Services Incidental to Mining. There were no changes in the existing 1987 industries. Coal Mining - 1987 SIC 1241, Coal Mining Services, was transferred to the new 1997 subsector Services Incidental to Mining. There were no changes in the existing 1987 industries. Metal Ore Mining - 1987 SIC 1061, Ferroalloy Ores, Except Vanadium, has been split into two new industries, Copper and Nickel Mining and Other Metal Ore Mining. 1987 SIC 1081, Metal Mining Services, was transferred to the 1997 subsector Services Incidental to Mining. There were no changes in the other existing 1987 industries. Non-Metallic Mineral Mining and Quarrying - 1987 SIC 1499, Miscellaneous Non-Metallic Minerals, except Fuels, has been split between Other Crushed and Broken Stone Quarrying and Mining (bituminous limestone and bituminous sandstone) and All Other Non-Metallic Mineral Mining (all other miscellaneous non-metallic minerals). 1987 SIC 1481, Non-Metallic Mineral Services, except Fuels, was transferred to the 1997 subsector Services Incidental to Mining. There were no changes in the other existing 1987 industries. Support Activities for Mining - This new subsector was created to include all incidental mining services. No new industries were created within this subsector; however, six existing industries were transferred out of the 1987 SIC industry groups based upon the mineral/ore mined into this subsector. The number of Mining Industries decreased from 31 in 1987 to 30 in 1997. For time series linkage 30 of the 31 1987 industries are comparable within three percent of the 1997 industries.