nor have we included in the backlog an agreement signed in april to provide 78 million tons of coal to a group of utilities planning a new electric generating plant near craig colorado this contract provides for coal deliveries beginning in late 1977 and continuing for 35 years at an average rate of approximately 2.1 million tons annually the coal would be provided from a new mine which utah would develop utilizing its reserves near craig part of these coal reserves are leased from the federal government and the ability to utilize these deposits could be affected if pending legislation passed by the senate were to become law in its present form the house version of this bill has not yet been acted upon and its final outcome is uncertain while the matter remains in doubt we will not include this contract in the sales backlog new shipping venture in arranging coking coal sales with european customers utah has retained responsibility for fulfilling the ocean shipping requirements long-term con tracts with shipping companies have been concluded to provide for the bulk of these needs however it has been decided that some portion of this transportation should be accomplished in utah ships for this purpose affiliated companies have been established in which utah will own 50 and companies with complementary back haul shipments will hold the other 50 through these affiliates orders for two new 126,000 ton bulk carriers have been placed with completions expected in several years ladd petroleum merger in view of the favorable outlook for suppliers of energy-related materials utah has moved to extend its resource extraction interests into oil and natural gas through a merger which became effective on november 30 ladd petroleum corporation a denver-based firm special izing in acquisition and development of oil and gas properties became a wholly owned subsidiary of utah although ladd is a relatively new company it has or ganized an experienced and imaginative staff which has proven its ability to build an inventory of petroleum reserves in the united states and canada at an attractive cost we are pleased to have the additional capabilities represented by the ladd personnel as a part of the utah organization and to welcome those who have become new shareholders as a result of this transaction officers to retire albert l reeves senior vice president and secretary of utah and a director has indicated his desire to retire from full time service early in the new year mr reeves joined utah in 1958 and has played an important role in managing the con duct of the company since that time charles e mcgraw senior vice president and manager of construction activities also has elected to retire mr mcgraw who leaves with 22 years of utah service is particularly noted for his years as manager of utah's worldwide construction interests appreciation and good wishes are extended to both outlook as this report is being written curtailment of middle eastern oil deliveries raises questions about the adequacy of energy supplies in europe japan and the united states and the potential impact of an energy shortage on the level of economic activity if the disruption in energy supplies is short-lived and the economic impact moderate utah international would expect satisfactory improvement in net income in 1974 even if copper prices retreat from the very high levels now prevailing new projects scheduled to come on stream in the next several years and additional capacity to become available at existing operations provide the basis for our optimism when considering the outlook for utah in the near-term the record of progress of the company over the past decade testifies to the skill and dedication of company personnel in carrying out the duties assigned to them personally and on behalf of the share holders and the board of directors we express our sincerest appreciation to those who have contributed so signifi cantly to the success that the company has enjoyed respectfully submitted distribution of mineral products f the board j &¦ mineral production and sales by utah and its subsidiaries and affiliates include steam coal coking coal uranium iron ore copper and as by-products saleable quantities of gold molybdenum silver and rhenium the mine sites and the markets which they served in 1973 are illustrated here