| January 22, 2020
From the Sixteen to One Archives
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|The following is a message from California’s governor. Can you identify which governor or when it was published? What a great message!
“May I confess that, while I have never engaged in mining, that earliest and most picturesque of California industries has always had a strong appeal to my imagination. One of my urgent ambitions as governor is to accomplish something in the way of stimulating and reviving that languishing industry. I would like to see the entire mother lode and all the mining regions humming with activity. Legislation, of course, cannot put gold into the ground. But I shall be responsive to all sound suggestions for the benefit of the mining industry and the mountain counties.
The gold in California’s streambeds and mountains was responsible for her birth both economically and politically as a member of the family of states. California’s gold was an important factor in sustaining the federal finances and credit during the stress of the Civil War in the 1860’s; and in spite of recession in annual yield in recent years, this commonwealth is still one of the leading states in production of the yellow metal. The decreased production of new gold is due to the nation-wide and world-wide economic conditions over which the gold miner himself had no control; and because the price of his product is a basis of our (and other nations’) monetary system, the gold miner is entitled to special consideration at the hands of our law-making bodies both of the state and nation to the end that whatever statutory or taxation burdens are now hampering the flow of new gold from out of the ground may be either eliminated entirely or at least ameliorated to the maximum degree. California should be in the forefront of the movement to help. We need more gold. In the United States today we are consuming in the arts and industries more than twice as much gold as we are taking out of our mines each year. Unless something is done to help, it is conceivable that the foundation of the financial system with sooner of later be affected.
But gold is not California’s only bid for fame and attention. This state is prolific in available minerals of commercial value, and the diversity of her products is not approached by any other commonwealth. Mining in California marches alongside of and goes hand-in-hand with agriculture, as one of the great basic industries upon which our people depend. Our wealth in structural and other industrial mineral raw material is widespread throughout California and in great variety, and if properly fostered and adequately supported by governmental promotion, will continue to grow in importance and will continue to support an ever-increasing industrial population in this state.”
|This a very important agency of the past: the O.M.E and should be reinstated. It sounds like a government organization needed again for the development of strategic metals relative to our national security. We have a national reserve for oil, but gold is too needed to be expanded in a national reserve.
There has been some reports about how the Bullion reserves of Canada are being depleted. It makes me wonder our own Nations Reserve.
|For you readers, something from the historical archives:
When the miners’ operation turned from gold production to survival at the Sixteen to One after the disruptive shaft fire, all management united to prolong the hunt for gold. For the underground crew and its surface support, the mine’s gold was their livelihood. For the owners and management preserving the mine became the highest priority.
This began late 1950’s. Gold could be found, that was not the problem. All concerns and hope for the future rested in its price per ounce. By now the 1934 freeze and federal takeover caused operations to cease throughout the world; but California felt the slow decline of its gold economy less than other states. Aerospace was booming and real estate development and new home construction intensified as the population crept towards that of the most populace state.
An obscure federal agency saw the merit in the United States as a gold producer. It was the OME (Office of Mineral Exploration. Money was available to match development and the sixteen to One was a taker. I became intimately familiar with the OME work, which ended in 1965. It was ten years after the fact, but its history was as valuable as it is important today. Original Sixteen to One Mine, Inc and the OME joined financially to continue exploration of the central Sixteen to One vein. It is referred to as Red Star and has been my target for gold since I first studied the maps in 1975.
Gold must be sold to the government buyers. There were two joint venture agreements between the mine and OME. The US treasury was locked in to $35 an ounce or the same price the company received thirty years past. However, the costs of mining increased as inflation surged through the economy. Gold smuggled into Mexico and other locations brought a lot more cash than what the government paid. Smuggling for the directors was not a choice so the miners were laid off. Some miners continued drilling and blasting but left the broken rock underground. And yes, Sixteen to One gold found its way into Mexico.
All the veins of Alleghany are siblings. They are related and just like brothers and sisters act differently under stress. The Red Star section of the bolder Sixteen to One is as close to virginal can be without being virgin. The people who invest time money or care resemble me. We are confident gold remains, untouched by human hands, and waits for the miners’ hand on his drill. The Sixteen to One vein is not exhausted. At $35 an ounce one jut could not stay operating.
Thanks to this small but mighty band that call up this forum from time to time. Stay tuned. Now is the time to help the California gold miners. It is not the economic past. The federal government will not succeed in gobbling all the gold next month. The price is not a concern. Have some fun with us. Mike
|My own personal archive:
Just before the CDAA assault, I'd been helping assess the highgrade potential within the mill-rock, so that the quality specimens wouldn't be crushed and would be preserved, as all high-grade rock brought to the surface was being assessed.
Somehow I'm writing an entry under "Archives".... while this super activity was ongoing at the mine, only a few years ago.
How far in the past is an archive? Relatively speaking, this was yesterday. The team was bringing major-big gold to the surface, and I was simply helping to identify a few missed ones.
The mine was so successful at this time in our "now"-past, that it boggles the mind...this was happening and then the crap shut it down.
Is an archive a "past" accounting of history? I know it's a "now" accounting of real potential....as the potential today as it was 150 years ago. I saw the gold in the rocks. Awesome.
|When the Company decided to sell its own gold collection to raise much needed working capital last year, I wrote the following descriptions for some of the pieces for the producer of the catalog to use as he felt fit. He used none.
The collection did not gain the attention it deserved. As one shareholder said at the 2008 annual meeting, "Lets hope that someone realizes what this collection will mean twenty or fifty years from today. People will say thanks for preserving it."
I just stumbled across my comments about the collection and decided that maybe, just maybe some hearty soul's curiosity will be stirred into action to keep the carvings in tact.
Comments of collection:
Imagine carving a block of glass only this glass is composed of different elements with different harnesses. This block is natural quartz, the geological home of lode gold. The carvers’ troubles continue because the material will crumble under the grinding wheel without warning, thereby undoing hours of planning and tooling. It does not help matters that his material, formed 135 million years ago, is layered, faulted and went through the miners’ drilling and blasting. “It’s like a car hitting bumps in the road or an ice skater hitting a patch of sand,” says carver Buddy Miller. Buddy created both the Sesquicentennial Series and Saturday Life of the Miner Series.
Francis Musser who was the first lapidary to carve the quartz and gold felt other initial concerns. He just was unable to put the quartz rock in his saw. Francis created the trilogy of The Bear, The Eagle and The Trout (or call it the Fish). “I had never carved quartz with gold and never had seen it carved before. Mike gave me this large rock that contained $60,000 of gold and said, “Go make a carving’. It took me weeks before I had the nerve to clamp it in the saw and make my first cut.”
Ron Martinez approaches his quartz and gold specimen in another way. Ron loves to work small. His carvings are of natural things, leaves, shells and freeform design. “I avoid the hard rock/soft metal problem by simply letting the gold dictate where I carve: anywhere except where there is gold!”
Martin Butler, the youngest of the carvers, is a metal smith by trade. His unconventional beliefs about artistic creation told him to make his own tools for the Dragon and Two Hearts carvings. He shunned all power tools, spending countless hours grinding his masterpieces by hand. The result is a very tactile experience when his carvings are dropped into your hands.
1. #005, 006, 007 are in the Sesquicentennial Series. It is called Discovery (1848).
2. #002, 003m 004 are in the Sesquicentennial Series. The two carvings are called “ the Rush” (1849).
3. #001 is in the Sesquicentennial Series. It is called Statehood (1850).
4. # 008, 009, 010, 013 are in the Saturday Life of the Miner Series. If he was lucky, he took a bath once a week or once a month. Details include the pile of cloths, his golden toe prominently displayed and the ore car. He still wears his beloved hard hat, probably lite with carbide gas.
5. # 014, 015, 016 and 017 are in the Saturday Life of the Miner Series. The rugged grizzly-faced miners are rejoicing around a mound of gold. Even without the stimulation of gold, the men would join together in song and dance. During the gold rush and beyond men outnumbered women by thousands to one. Yet the joy of a dance persisted. The dress and physical appearance, the detail and of course the ever present hard hat deserve close attention.
6 # 011 and 012. The Phoenix is a symbol of immortality: a grand example of the matchless beauty of nature’s birthplace of gold.
7. #018, 019, 020 and 021. “A Rare Beauty”. With only the respect and admiration for the sight of a woman, this gold miner approaches a woman resting deep in thought. He brings a bouquet of fresh roses, gently reaches out to touch her hair. She is unaware of his presence but accepts his honorable intentions towards her for she realized how lost and lonely most of the miners feel in the untamed west.
8. #022, 023, 024, and 025. “The Jug Band”. The music livens the campsite; but the two dogs hear only noise. One howls and the other lies down and covers its ears. Note the detail in this six piece series, including what the miners are sitting on. The Jug Band elicits smiles. You can almost hear their music.
9. #026, 027 and 028. “The Law”. Lawyers and mining history are recounted in the early years of the American Western gold rush. The weight of the law book crushes the miner, bending but not breaking his neck. The city hat and miner’s hard hat represent an ongoing struggle between the producer and the regulator, the blue collar and the white collar.
10. #029, 030 and 032. “one of the most strikingly colored trout in the world”
at both the state and federal level have attempted to protect and preserve this beautiful native fish various means including:
1. designating the California golden trout has the State Fish of California in 1947;
2. creating the 300,000 acre Golden Trout Wilderness in 1978;
3. including the California golden trout on the U.S. Fish and Wildlife Service’s Endangered Species List candidate list as a category 2 species in 1991; and, most recently, by
4. adding the California Golden Trout to the Forest Services Sensitive Species List.
11. #032, 033, 034,and 035. Found throughout the Northern Hemisphere, the Golden Eagle is common in western North America, but rare in the East. It is one of the largest birds of prey in North America; only the Bald Eagle and California Condor get larger.
The Golden Eagle is the national emblem of Mexico.
12. #036, 037, 038, and 039. Francis Musser’s first carving is the Bear. Every view and every angle of this remarkable creature is inspiring. Featured on the 1995 annual report, the Bear please young and old.
13. #040 and 041. The Dragon. It seems that every dragon has its own personality just as each of the earth’s elements has its own energy. Perhaps by its size or the richness of the polished gold, the Dragon seems to pulsate when it is dropped into your hands.
14. # 042 and 043. Fred, we called this Two Hearts or Hearts on a Foot or Two Hearts on a Foot. This is another really fun piece. I tell people to close their eyes and hold out their hand and tell me what they are holding. Men or women stutter because it feels like a couple of balls, the ones we have. Maybe this is too risqué for the catalog but on the other hand….
15, # 044. A hand carved precious box of ebony wood with a large cabochone of quartz and gold on the cover.
Fred, I’m stopping now. Don’t even know if any of this is appropriate but we are here to educate the rich and adventuresome. You said they want “bragging rights”, well this collection will give them a bunch. MMM
|Yesterday, I sent the article (see 12/04/08 entry below) to some business friends and acquaintances. Four sent back comments. Here is my introduction to the Bonham release:
To: Director Scott Robertson
Scott: I'm sorry the collection will no longer be on display at the bank in Nevada City. It is short sighted of the trustees. MMM
Two people recognized the loss to the public from this sale, one suggested getting the Ghidottis to invest the proceeds in a plan to mine more gold from the Sixteen to One (both are deceased and the foundation will put the proceeds into education) and the other well wisher took a different meaning from my mentioning “shortsightedness of trustees”. I want to clear this up now and sent him the following:
No,the trustee remark did not feel good nor is it a reason why I included it in the brief introduction I sent about the upcoming auction. The shortsighted remark is my reflection on the loss of history with this sale. It is directed to anyone who is aware of the current Sixteen to One collection on the chopping block with money or contacts with people or organizations that work towards the conservation of history. The Ghidotti collection is historically relevant in a minor way. Our collection is historically relevant in a miner way. The loss to our grandchildren is an awareness of how the great American West came into being. A collection is just that. A collection broken individual pieces is something else. That is the basis for my remark about shortsighted. After the first of the year I will be examining ways to break up our historic collection. It will not be a shortsighted decision because the money is needed for our survival as a gold producer not any other reason.
I appreciate your comment and continue looking to the date we set to show the mine to the investors you mentioned. Light a candle or better yet a torch under their bed. MMM
|I looked at the offerings on lone and must say there are some real treasures to be had. I plan on attending and may bid on several of the specimens. I particularly admire the gold "slickenslide" example. All of you should check out this amazing collection being sold. Go to the link below for details, and then start viewing the individual lots at #1278: http://www.bonhams.com/cgi-bin/public.sh/pubweb/publicSite.rsContinent=USA&screen=catalogue&iSaleNo=16155
|Bonhams & Butterfields is delighted to offer the distinguished William and Marian Ghidotti Foundation Gold Collection in its upcoming Natural History auction on December 7 & 8, 2008 in Los Angeles. Initially accumulated over a 50-year period by owners of the famous "Original Sixteen to One Mine, the collections legacy harkens back to the historic California Gold Rush of the 19th century. Additionally, it represents William Ghidottis legendary philanthropic vision as a Californian.
A renowned collector, William Ghidotti’s name is intimately linked to the history of Nevada County, California, where, among other philanthropic projects, he and his wife Marian Ghidotti devoted themselves to the improvement of education in the region. Mr. Ghidotti’s acquisition of the acclaimed gold collection followed his discovery of an advertisement in the classified section of a San Francisco newspaper in June of 1965. The ad read: “To be sold. 25 beautiful irreplaceable quartz and gold specimens suitable for museum or private display.” A simple announcement, but beneath the modest offer lay the heartbreaking story of the decline in the fortunes of one of California's most acclaimed gold mines, the "Original Sixteen to One Mine" of Alleghany. The mine was faced with such rapidly increasing operating costs in the mid-20th century that the owners were forced to sacrifice their collection of choice showpiece nuggets.
Interestingly, the gold mining company sold the collection of natural gold specimens for 400% more than if the gold and crystal had been crushed and sold as bullion, illustrating the profitability in collecting gold specimens of historical importance and aesthetic appeal. Offered publicly for the first time since 1965, more than 20-lots of gold specimens, weighing a total of approximately 230 troy ounces, come to auction in Los Angeles.
Top lots within the collection include a specimen weighing more than 36 troy ounces described as magnificent, displaying distinct perfect cubes (est. $125/150,000).
Another lot maintains a mass of large outstanding gold crystals, weighing more than 35-ounces, estimated at $100/125,000. Considered a rare find is a gold slickenside specimen. Slickenslide refers to a specimen displaying a vein of gold growing through quartz, the offered example weighs more than 36-ounces, with multiple veins and blue quartz seen beneath the layers of gold (est. $60/70,000).
This extraordinary private collection not only represents William Ghidotti’s deep and abiding passion for this distinctive precious metal, its sale will now become the means to continue the Ghidotti Foundations funding of college scholarships, reflecting the original collectors philanthropic spirit.
In addition to the William and Marian Ghidotti Foundation Gold Collection, a selection of gold in quartz cabochons and mounted rings from the famed Sixteen to One Mine will also be featured, one examples is a gentleman’s ring adorned with diamonds and gold in quartz, estimated to bring as much as $1,500.
According to Department Co- Director Thomas Lindgren, This is the largest section of gold Bonhams & Butterfields has offered in its Natural History sales since the 1994 auction of specimens from the Sixteen to One Mine. We are pleased to offer such a rare assortment to the public.
|Please go to NEWS for an historical treat: the exact copy of a letter from Fred Searls, JR to the president of our Company (October 30, 1961). (Searls later founded Newmont Mining, now America’s largest gold producer) This along with a letter sent by and signed by Bernard M. Baruch are two of my favorite documents in our archives. According to Donald R. Dickey, owner of the Oriental Mine in Alleghany, Mr. Searls, known for his eccentricity and pompous arrogance cut his teeth for underground surveying at the Sixteen to One sometime around 1923
Mr. Searls goofed his survey and lost his way on the 250-level, which is why there is a sharp turn on the 250-level far north in Red Star ground. Fred admitted that this was his only mistake in his highly successful career. For any miner that line is hard to swallow.
Well, years later Searls and two friends took pity on the struggling Sixteen to One. Most gold mines had closed but the Sixteen knew that a good gold showing in the north would keep the mine operating. The trio put up some money and later forgave the debt. Oh, if Fred Searls were alive today. Could we have some fun!
|Does anyone know anything about "Chain O'Mines, Inc."? I hold in my possesion many stock certificates for them and "Midwest Operators, Inc.". These certificates were issued in the early 1900's and are probably useless, but if someone could point me in the right direction, it will be much appreciated. Thank you
|Is the Balfour Holdings, Inc report useful today (see following entry for more about Balfour and Doug Silver)? Was it an accurate forecaster as we look back into the Gold Sector?
Affirmative, I say. Big gold companies as well as cash rich American corporations (individuals also) continue to shy away from good junior gold mining companies, such as ours (#3 in report). Billions of dollars were lost in the high tech and dot com feeding frenzy. The Gold Sector has some shame as well but nothing like the ridiculous market cap ratios for public companies that had no sales or income. Our plans for the future are getting more attention from entities capable of meeting the financial risk. Two reoccurring reasons I hear for this interest are: the mine is permitted and operation;
the company produces gold and has income. These are major and significant reasons why the Sixteen to One stands apart from almost all junior gold companies seeking fresh capital to broaden its development.
This entry concludes excerpts from the 85 pages of the Balfour report that has been in my library since 1992. Hope you find it interesting.
Exploration or Extinction?
An Analysis of the Supply Crisis Facing the Gold-mining Industry
11.5 Recommended Strategies for Success
A number of strategies can be implanted in today’s business climate to enhance the probability of corporate survival, while also minimizing both the cost and risk. The following list offers proven strategies and perceived approaches.
1.) Increased exploration efforts. Since most mining companies have severely restricted their exploration budgets and activities, now is the time to be counter-cyclical and invest in exploration activities. The competition is less and potential still exists. Insightful companies should consider rethinking exploration target concepts and attempt to develop new targets by testing variations on conventional model themes.
2.) Almost all of the currently known gold deposits in the U.S. reside in historic mining districts. Consolidating large land positions within historic mining districts could enhance the probability of discovery while also facilitating the use of centralized processing facilities. Successful examples of this approach have been seen at Nerco’s Cripple Creek, Colorado operations and within the Carlin trend in Nevada.
There is an old saying that “if you want to hunt for elephants, go to elephant country.” Never has this been more true than for U.S. gold exploration. Companies seeking virgin targets in unprospected areas face almost insurmountable odds against success. Given today’s lean budgets, this approach may not be appropriate.
3.) Investing in Junior exploration companies with superior projects. This approach has long been shunned by American companies, to the competitive delight of their Canadian counterparts. American companies tend to take the position that investing in Junior companies will not only create additional tax liabilities, but also make them appear as holding companies, a title which could result in lower P/E ratios or suppressed share prices. Additionally, American companies seem pre-occupied with being in absolute control of their investments at all times. The concept of being a minority partner or conducting a creeping takeover is seldom considered a viable path for growth.
Canadians have demonstrated that investing in smaller companies has no impact on their trading prices or P/E ratios and allows them to participate in many exploration plays at a fraction of their normal costs. The premise assumes that the Major company takes an initial minority position in the Junior, but requires the Junior to raise public funds to cover the cost of high-risk exploration. As success is achieved, the Junior’s shares increase in value, thereby offering the Major the opportunity to sell and realize profits. Alternatively, if the Junior’s project is scientifically advancing towards the developmental stage, they will eventually require additional infusions of funds. This permits the Major to increase its ownership in the Junior through future private placements. When the project advances to the point of requiring capital project financing, the Major, now a significant, if not controlling, shareholder either absorbs the Junior or swaps its position for direct equity in the project. Companies such as Teck Corporation, Corona Corporation, Placer Dome, and Noranda have partially built their empires from the successful application of this technique.
4.) Grubstake proven ore finders. Successful ore finders often decide that there is more profit in finding ores for themselves rather than for an employer. Consequently, it is not uncommon for these people to be independent. Companies seeking success should identify and grubstake these people as an alternative to expanding their acquisition and/or exploration teams. Offering an ore finder a small overriding royalty makes commercial sense as it provides important incentives while not dramatically effecting the economic of the project. Grubstaking ore finders also escapes the need to spend precious corporate funds on training, health benefits, pension plans, and severance packages, etc.
Companies should also consider grubstaking individuals with proven track records in acquisitions. These individuals tend to be extremely well-versed in the intricacies of the mining industry, have widespread networks, and the ability to find or generate opportunities before the asset is put on the auction block.
5.) Searching internationally. The exodus of traditional American companies to Latin America has been the most predominant trend in the past twelve months. Companies are sending teams across the southern hemisphere in search of opportunities. Partially drawn by the emergence of pro-mining business in the U.S., these companies hope to replace their resources by tapping into the enormous potential of underdeveloped countries. Unfortunately, Latin America is not a panacea, and its problems and pitfalls are often overlooks, underestimated, or viewed as subordinate to those already known in the Unites States.
It appears that some companies are heading south of the border because of the mentality that the “grass is greener on the other side of the fence”, rather than because the United States is exhausted of quality opportunities. There companies should beware the costs of investigating foreign investments, including multiple trips by various corporate teams, relocation of corporate personnel, legal, political, environmental reviews, and cultural and lingual differences as well as accounting for opportunities lost at home, can prove to be quite expensive.
|I am a junkie for mining data and history, which is why this topic is on the FORUM. The successful pursuit of mining gold, investors and hobbyists is greatest for those with an historical perspective. There will always be charlatans, soothsayers, self proclaimed brilliant analysts, quacks and outright frauds in any sector of our society, including the Gold Sector. There are brilliant professionals and some scholars, advisors or writers who are just ignorant of aspects of their trade. That is okay. That is one reason to study. Most everyone but the severely arrogant has been in an ignorant situation before.
The following excerpt comes from a very high-end report published in March 1992 and prepared by Balfour Holding, Inc. Its author, Douglas B Silver, still operated his company from Colorado (www.dugag.com). We met as a result of his research, which circulated among the highflying gold people and remains a valuable tool for us.
Exploration or Extinction?
An Analysis of the Supply Crisis Facing the Gold-mining Industry
1.0 Executive Summery and Conclusions
The past decade of gold exploration and mining activity in the United States has witnessed one of the steepest growth rates in history. National gold production levels have increased by ten-fold, with more than 130 new gold mines having been commissioned. Companies have also grown with this additional capacity, with several now producing in excess of one million ounces of gold per year. This growth was made possible due to a combination of factors during the 1980s, including:
1.) The favorable investment markets for shares of public companies and the high price to earnings ratios enjoyed by the gold mining industry.
2.) The abundant project and corporate financing available through equity offerings, conventional debt, and well as by gold loans.
3.) The successful discovery of epithermal gold deposits in the Great Basin region.
4.) The liberation of gold prices from a fixed standard.
Collectively, these four aspects created a strong demand for gold shares and allowed companies to build with unrestrained growth.
Today, the world’s financial structure has changed dramatically from the “golden days” of the 1980s. Precipitated by the Stock Market Crash of 1987, companies are becoming hard pressed to service their high annual production levels because:
1.) The equity market for gold shares has evaporated. Lackluster gold prices continue to hurt corporate earnings, many companies do not deliver on their promises, and the industry’s anti-dividend attitudes inspires investors to support or maintain their interests relative to other investments.
2.) Efforts to reduce costs have several impacted exploration spending. Consequently, fewer discoveries are being made, even though there is no evidence that there is lack of opportunities or that the U.S. is “picked over”.
3.) Business development teams are finding fewer opportunities worth pursuing because the low gold price adversely affects project economics, even before consideration for acquisition costs. The difficulty of financing acquisitions in today’s markets is highlighted by the fact that the number of transactions completed in 1991 involving U.S. gold resources is half the number seen in 1988 (and occurs in levels comparable to 1985). The paucity of new discoveries is causing the acquisition pipeline to dry up, as acquisition opportunities are recycled without significant changes in their technical advancement status.
4.) The largest mines are depleting their finite resources faster than they can replace them.
5.) The attitude by corporate management that they must continue to increase their annual gold production levels in order to attract investor interest and remain on mining analysts’ coveted research lists. This is forcing corporate decisions to mine large ore bodies at a rate that exceeds the size of deposits offered by Nature for replacement.
Collectively, these attitudes indicate that the largest, pure-gold producing companies must take steps to attract investor attention, but on a basis other than sustained growth in production. Possible survival strategies include diversification to other commodities, overseas expansion, transforming companies into holding companies and redirecting analyst’s attentions from production levels to other, more appropriate investment criteria.
The future and fate of the U.S. gold mining industry rests solely on the shoulder of the companies involved in the exploration, development, and production of gold. No government subsidies are currently being considered and public support for the environmental movement may prove too powerful and ultimately eliminate mining in the Unites States. However, this race is neither rigged nor over, and many constructive options are available to innovative or foresighted strategists. Hopefully, this study will provide quantitative information upon which successful strategies can be built while also dispelling common misconceptions.
|Thanks, Mr. Pres. By the way,
does anyone know the geological
composition of the Bellvue
Tunnel in the Laporte mining
district? In my younger days
I went to boy scout camp near
|Hi Martin. I took geology twice at UCSB and still find much of the Sierra Nevada and particularly the Sixteen to One vein system a mystery. So here is the third (see below) excerpt from the Jack Havard report of 1980. Have fun with the host of gold, quartz.
The quartz veins of the Sixteen to One Mine are typical of the Alleghany district and have been the most productive of gold in the district. The Sixteen to One vein is the dominant feature at the mine, but it is joined by several other veins originally considered independent: the Twenty-One, the Ophir, the Tightner, and others.
The Sixteen to One vein occupies an east-dipping reverse fault, with several hundred feet of displacement, which is part of the en echelon east-dipping reverse fault system of the district. The veins, here as elsewhere, are dominated by structure and ignore the county rock except for its mechanical properties. The country rocks are mostly the schists of the upper Tightner, the Kanaka conglomerate and some significant serpentine bodies. Most of the rock is hard and brittle, the exception being serpentine, which behave in a plastic manner.
The vein strikes about N 21 W and has been mined over 4000 feet on its strike. It dips at an average of 38 to the east and has been mined to 3000 feet on the slope.
The relationship of the vein system to events of the Sierra Nevada orogeny are not pertinent to the report, but the sequence of mineralization is interesting in the consideration of gold occurrence. H. R. Cooke, Jr. made a thorough study of the Sixteen to One vein (H. R. Cooke, Jr. The Original Sixteen to One Gold Quartz Vein, Alleghany, California, Economic Geology, Vol 42, No. 3, 1947).
Concerning the ore minerals, he writes:
Occurrence – Ore minerals form less then 2% of the volume of the vein, and are about equally common in massive quartz and in fractures, inclusions, or ribbons. They generally are clustered around large grains of pyrite, sphalerite, or tetrahedrite, but arsenopyrite, gold, and galena often occur alone or in combination. The only ore minerals in appreciable amounts in wall rock are fine-grained pyrite, arsenopyrite, and pyrrhotite. All ore minerals are hypogene except for traces of covellite and possibly a little chalcopyrite or bornite. The only evidence of zoning is unusually abundant pyrite in the schist of several lower levels, accompanied by a slight tendency for gold to be more evenly disseminated through the vein.
Five factors seem outstanding in localizing ore minerals:
1.) Fractures: the main channel-ways for the flow of ore solutions.
2.) Carbonate: the mineral probably most replaced by ore minerals.
3.) Quartz: controlling deposition of ore minerals by its resistance to replacement.
4.) Early ore minerals: tending to be replaced by later ore minerals.
5.) Graphitic gouge: tending to restrain ore solutions from invading wall rock.
Gold – Gold was the last ore mineral to be deposited and displays marked inability to replace quartz and earlier ore minerals. Gold generally occurs alone in quartz on grain boundaries or in fractures, and in very rich specimens of flood quartz, where it probably replaced carbonate inclusions; occurs with galena, often partly surrounds and fills fractures in arsenopyrite.
The average grade of the whole vein is too low for profitable mining, which means that more high-grade must be found than in random mining of the vein, The Sixteen to One high-grade is richer than any other for with I have seen comparable data. Scattered in a vein otherwise assaying about 0.04 oz., several hundred shoots have been mined, producing up to 78,000 oz. Each and running from 2,000—6,000 + oz., or on the order of 100,000 times richer than adjoining vein areas.
Dr. Cooke points out that 608,012 plus tons had been mined from the vein through 1942, yielding 749,179 plus ounces of gold. The hand-sorted high-grade, weighing only about 164 tons and constituting only 0.027% of the tonnage mined, produced 548,759 plus ounces of gold or almost three-fourths (73.25%) of the gold yielded.
In summery, when pockets are found the mine is rich; when pockets are not found the mine is destitute. This is the history of the Sixteen to One, and many of its smaller neighbors.
|It would have been easier for
me to understand things had I
taken geology in my college
days but I didn't.
|History of the District
The history of the Alleghany mining district begins with the discovery of coarse nuggets in the bed of a creek by a group of Hawaiian sailors in the spring of 1851. Appropriately the creek was called Kanaka Creek. Its deep canyon has been the scene of intensive gold mining continuing to the present time. In the general area, gold was found in the streams probably as early as 1849.
The river bars were first mined, followed by exploitation of the Tertiary river gravels. Drift mining of the buried channels, first at Alleghany and then on a larger scale at nearby Forest, reached an initial production peak in about 1861 but continued with another peak in the 1930s at the Ruby Mine.
Mining of lode gold began in 1853 with a stamp mill placed in operation in 1858 at the Rainbow Mine in Kanaka canyon. Some veins, including the Rainbow, were discovered by miners exploiting the auriferous channels on bedrock. Lode mining was spotty from mine to mine because of the nature of the ore shoots. Peak production from the lode mines in the Alleghany district is report in the year 1922 as 50,231 tons valued at $1,710,521. With the gold price fixed at $20.67 and ounce, this meant a value of $34.05 per ton or 1.65 ounces per ton. Later discussions in this report will explain this high value.
In 1942, the gold mines were either shut down or extremely limited in production because of the War Production Board Order L-208. After the war, gold mining resumed on a reduced scale, gradually fading due to the fixed price of gold and increasing inflation of costs. The last major mine to shut down was the Sixteen to One, which ceased regular operation in December 1965 not only because of high costs but also because of lack of ore. Only recently has gold mining been revived substantially because of the high price of gold, but much of the activity in the district has been speculative and all of it has been on a small scale.
The following quotations are from Gold Mines of California, by Jack R. Wagner, Chapter 14, The Original Sixteen to One Mine:
The Twenty-One was the first to be developed and was in operation prior to 1868, but never made any notable production. About 1914 it was reopened by Hunt, the cannery man, who found high-grade ore in a new vein. What looks like good prospects were soon dashed to bits when a crew from the Sixteen to One suddenly broke into Twenty-One workings, clearly showing, to the embarrassment of all, that both mines had been working on the same vein. The Sixteen to One brought suit for trespassers against the Twenty-One in a Federal Court in San Francisco, which in 1919 resulted in a judgment for $93,000 against the Twenty-One. The owners found it simpler to dispose of the property and the mine was purchased by the Sixteen to One for $60,000. The Twenty-One tunnel now forms part of the 800 Level of the Sixteen to One.
…A three-way partnership was formed in 1891, motivated by an old-timer by the name of Jim McCormick. McCormick had remembered that bedrock vein that had been uncovered and ignored in the Knickerbocker (channel) tunnel nearly forty years before. The partners soon located the Contract and Contract Extension lodes that ran north and south of McCormick’s remembered vein. After driving further north a small winze was sunk but the vein tightened, causing the mine to be dubbed the “Tighter’ner” by the townspeople.
In 1903 Henderson L. Johnson took a lease and bond on the Tightner Mine. Johnson decided to drift south; his first blast dislodged $20 worth of gold and it was soon apparent there was more where that came from. This discovery was firmly established quartz mining at Alleghany…
Later, a property known as the Eclipse Mine, situated north of Kanaka Creek, was purchased and the present Tightner Tunnel was run. This tunnel cut the vein at about 400 feet vertical depth below the old Knickerbocker Tunnel and later was cut through the connect with the Sixteen to One Mine at the 250-foot level.
In 1908, Johnson added a number of other properties including the Rainbow, Red Star, and Eldorado--- Johnson sold out in 1911.
The New Tightner Mines Company continued to be a profitable operation under the direction of J. M. O’Brien and A. D. Foote. Foote and O’Brien operated the Tightner Mine and its twenty-stamp mill until 1918, producing a total of $3,000,000 from which $500,000 was paid out in dividends.
In 1919 the Tightner Mine was reopened by the Alleghany Mining Company, an organization put together by Fred Searls, Jr., who later became president of the worldwide Newmont Mining Corporation. Under their direction the Tightner produced some $600,000 in gold during the next four years. Unfortunately for the Tightner people, it soon became apparent that the Tightner and the Sixteen to One veins were one and the same. Costly litigation was avoided when an agreement was reached---the entire mine was sold in 1924 to the Sixteen to One.
For a mine that was destined to produce millions, the Sixteen to One Mine has a rather inauspicious beginning. The property was originally owned by the Rainbow Mine, but was never deemed worthy of development. The portion later to be known as the Sixteen to One was located by Thomas Bradbury from an outcropping in his own backyard. That was in 1896, the same year William Jennings Bryan, as a delegate to the National Convention, wrote the Silver Plank in the platform which advocated that coins be minted with 16 parts of silver and one part gold…
In 1911 the Bradbury brothers and Yeates Lawson made an agreement with J. G. Jury and W. I. Smart to lease the property with an option to buy. Jury and Smart, with the addition of H. K. Montgomery, organized that same years as the Original Sixteen to One Mine, Inc. It was this company that operated the mine for 54 years, right down to its final days.
During its heyday, it was not uncommon for a pound of ore to yield $50 in gold and single shoots would produce anywhere from $200,000 to a million! Dividends totaling $1,238,501 had been paid to 1924. In 1934 alone, bullion receipts were $578,000 with dividends of $287,000.
During the postwar years the Rainbow and Sixteen to One Mines were purchased. Also acquired was the Tightner Mines Company, which still controlled the Red Star property. (Thus the Sixteen to One gained control over the old Bald Mountain channel mines. – JFH)
The Sixteen to One now owned the most promising group of mining properties in the Alleghany district, but unfortunately continually rising costs and the gradual exhaustion of the developed portions of the mine resulted in depletion of working capital.
During the last year or so of operations, the mine payroll had been reduced to 12 to 15 men and the work had been more or less exploratory rather than producing. The management sought that one long chance of finding ore of a high enough grade to warrant continued operation in the face of terrifying costs.
The end finally came at the December 9, 1965 meeting in San Francisco of the mine’s board of directors. With President Walter Stinson presiding, the directors reluctantly voted to close the mine.
End of Quote
When the Sixteen to One acquired the Tightner Company, with its Red Star property, the Sixteen to One gained control of the Bald Mountain lands and the old channel mines. The same stockholders, or their descendants, some 300 of them, still own the Original Sixteen to One Mine, Inc., a California corporation, but the officers have been wracked with dissension and troubles persisting into June, 1980. Additional problems surrounded the lease to the Sixteen to One Mining Corporation, a Nevada corporation, now in bankruptcy court.
The manner in which the Sixteen grew is the preferred way taught in all good mining schools. Mining districts go through periods identified as: Youthful Mature, Old Age, much the same way geological periods are defined. I believe the Alleghany Mining District is in the Mature Period at this time.
The above recap was included in the Jack Havard report to Rayrock mines in June 1980. (See following entry). Jack’s words, “the officers have been wracked with dissension and troubles persisting into June, 1980” tells of my activities, which began in 1974. I was the dissension “wracker” and continued until the 1983 shareholder meeting, when the old management was finally booted off the board. The lessee called themselves the Sixteen to One Mining Corporation. It continued fiddling in the federal bankruptcy court in Reno Nevada until 1983, when Lucky Chance Mining expressed an interest in the mine. Lucky Chance “ponied” up $2 million and I negotiated a new lease with its management. It also failed but hung on in a series of joint ventures with Royal Gold as the ultimate major player. We bought the lease back with all the equipment in June, 1991. Two more Alleghany mining properties were acquired since then: Plumbago Mine and Gold Crown.
|Being a gold owner and operator continuously for over 100 years, the Company has a tremendous amount of data. Below, are excerpts from a report prepared for Rayrock Mines, Inc by J.F. Havard, Engineer of Mines, written in 1980. These records are just as valuable today as when they were written. It is not practical or prudent to send our historical information to people who express an interest in joining our plans for development and production; however, I have always extended an invitation to qualified inquiries about financial participation. This is not a gold deposit or program that should be dismissed as too speculative or not worth the investment. The following are taken verbatim from Mr. Havard’s report.
Possibilities for Additional Ore
The principle reason for studying the properties of the Original Sixteen to One Mine, Inc. is to assess the possibilities for the presence of additional ore – commercially minable ore reserves.
Two entirely different types of ore must be considered:
Lodes – Mostly exploited near Kanaka Creek in the Sixteen to One Mine, mostly included in the present lease, but perhaps extending northward in to unleased area.
Channels – Mostly exploited in the Bald Mountain area, mostly explorable in that area and mostly free of the present lease.
The Sixteen to One Mine was closed in December 1965 after desperate efforts to locate new ore bodies without a comprehensive well-financed exploration plan. The mine even participated in a government-financed program in 1965 as an aid to finding more ore. Today, the Sixteen to One can show no proven, probable or possible ore.
Nevertheless, it is worthwhile to examine theories offered by geologists and mining engineers on how best to search for additional reserves:
USGS Professional Paper 172, Page 60 (1932)
The Alleghany district stands alone among the districts of the Californian gold belt in its peculiar type of ore shoots, so that no analogy based on the persistence of ore to great depths in districts such as Grass Valley and the Mother Lode region is pertinent. The gold has been deposited from hypogene solutions and is in no way dependant upon either the present surface or the surface that existed prior to the outflow of lava, and there is no reason to anticipate impoverishment in depth on this account. It is possible, however, that there may be a change in the character of the ore with greater depth. The wider distribution of gold in the lower levels of the Sixteen to One Mine, as shown by the data given on page 52, is perhaps an indication that with greater depth the gold will tend to occur in larger shoots of lower grade…
In conclusion, the authors are of the opinion that there is no reason indicated by the present study why the mines should not prove equally productive to a much greater depth than had been reached at the time the field study was made. This opinion is, of course, not meant to be taken as an encouragement to deep exploration of a vein in which shallow development has revealed nothing of promise.
Report on the Rainbow Mine, by M. R. Lancaster, 1909
(The Rainbow is part of the Sixteen to One property south of Kanaka Creek.)
I should say therefore that the only manner in which to prospect for pay ore would be to select points where the ledge shows a good body of quartz and open these blocks by drives and raises.
Willard P. Fuller, Jr., San Andreas California, August 29, 1965
(In a letter to the president of the Sixteen to One from a mining geologist who spent 2 ½
years at the mine (1951-1953))
…It is my opinion that the Alleghany district in general and the properties of the Sixteen to One Mine in particular probably represent the most favorable ground in California for the exploration for new gold ore bodies that can be mined profitably in today’s economy.
Utilizing the surface plant and existing mine openings, Mr. Fuller proposes development as follows:
1.) Northerly, down the rake of the north ore bodies below the 1500 Level, in the Red Star claim.
2.) Southerly, down the rake of the ore bodies in the southern part of the mine, below the 2400 Level and south of the “49 winze”
Then he goes on to say:
A much more comprehensive exploration campaign should. When finances permit, be undertaken to prospect the northerly continuation of this entire vein zone. With more than 1 ½ miles of a major vein system barely touched by mining up until now because of the deep Tertiary cover, and with geological conditions very similar to the mile already developed by the consolidated Sixteen to One workings, this exists as one of the most promising areas for development of gold-bearing quartz veins in the district. It would probably be more feasible to develop this portion of the Sixteen to One holdings from the town of Forest rather than from the Alleghany side of the ridge.
C. W. McClung, Mountain Copper Company, 1960
“Recommendation and Conclusions”
Basically, our proposal for reviving the Sixteen to One Mine is to have the present mine to provide funds for the major share of the cost of exploring and developing a new mine. This would be accomplished by doing first limited renovation of underground working, surface plant and mill, and then systematically stripping the mine of possible ore shoots (second guesses), shaft and stope pillars, and drift stills and crown pillars. It is assumed that this program, which cannot be evaluated by conventional means, would provide the money from short-range operating profits needed for extensive exploration and development which must be done if the Sixteen to One is again to become a long-lived, profitable mine.
Eldon Dennis, Geologist, two reports on the Rainbow Mine, 1935
After diamond drilling, dip needle surveying, and geological mapping, Mr. Dennis makes recommendation for some detailed small-scale exploration in the Rainbow and then writes, “I am inclined to look with more favor on the possibilities of production from the unexplored area beneath the lava cap.” He refers to the ridge south of Kanaka Creek.
H. R. Cooke, Jr., The Original Sixteen to One Mine Quartz Veins, Alleghany, California, Economic Geology, Vol. 42, No. 3, 1947.
Extracts from the abstract:
Extremely rich gold shoots are scattered in the Sixteen to One vein in otherwise barren quartz. The main result of this study is the recognition of some structural features that might guide exploration of the ore shoots.
The most common significant findings are:
1.) High-grade commonly follows late shears on or near wall veins, especially the foot-wall, or crosses the vein diagonally up-dip on intravein shears and ribbons.
2.) The high-grade distribution accords with that of openings expectable from the reverse movement indicated: high-grade is most abundant where the vein is flatter than adjacent areas along both strike and dip, and virtually lacking in corresponding steep areas; serpentinite and cross-faults partly localized by serpentinite steepened in the vein sheer zone. Much high-grade occurs in complementary flats and near cross-fault intersections.
This paper, condensed from a Harvard Ph.D. dissertation, is outstanding for its detailed observations, but is not helpful in regard to major deposits.
R. W. Wittkopp, A Hypothesis for the Localization of Gold in Quartz Veins, Alleghany District, California
(Presented at a conference on California minerals sponsored by the Sierra Nevada Section of the Society of Mining Engineers, A.I.M.E, March, 1980.)
…The present hypothesis proposes that ore bearing mineralizing solutions did not move up the quartz veins, but moved up along the serpentinite contact forming the mariposite bearing rock. When the ore bearing solutions came in contact with the quartz veins, mineralization took place near the contact…
The location of the high-grade pocket within the quartz veins in usually related to much structural features as change in thickness of the vein, split in the vein, intersection of the vein with other veins, or fractures or change in dip or strike of the vein.
|Below is the last of three reports I found in our achieves, which paint a good picture of activities a dozen years ago. This was the year the company issued a stock dividend. Hope you find them interesting.
~ Executive Summery ~
Third Quarter, 1995
· Increased pump storage on the 2400 Level
· 5,000 fozt from the 1719 heading
· Tailings dam on the 1900 Level broke
· Gold on the 2600 level in the 2483 Winze
· Significant labor turnover
· Sixteen to One is on the Internet
· Rainbow exploration
1995 probably represents the highest turnover of underground employees to date. Ernie Locatelli and Walt Grimes are out on disability for prior employment back injuries, Scott Robertson went to Newmont in Nevada, Dave Brown got a job as a trainee mineral officer for the Us Forest Service, Jason Bell and Tom Alling went mining on their own, and Glenn Knapp went to Brushcreek.
We are still competitive in the local employment field, especially with respect to Siskon and Brushcreek. Out wages are lower ($15 versus $20), however our working conditions and bonus program are far better. Also, this turnover is far less than what Siskon and Brushcreek are experiencing.
The only two terminations that concern me are Scott and Dave’s. I have discussed this with Mike and the general approach is to create a form of a reward system whereby people are compensated with increasingly greater 401K (i.e. company stock) depending on the length of employment. There should be at the same time some form of punishment for early leaving/
Present labor force consists of:
· Mark Loving
· Billy Joe Van Meter
· Dan McCloud
· Britt McDaniels
· Tony Langdon
· John Covert
· Sam Griffith
· Jeremiah Farrell
· Fred Lacey
· Jake Venable
· Jay Noble
· Mark Fussell
· Ray Standring
· Steve Shappert
· Dan Stafford
· Gar Cochran
· Kenny Newell
· Mike Gray
· Rick Harmon (office)
· Ian Harey
· Chuck Baird
· Mike Lucas
· Jonathan Farrell
Rick Harmon has moved from the specimen department to the mine in capacity of administrative assistant/office manager as well as company information administrator on the Internet.
Over 5,000 troy ounces was recovered in June 6’ in from the old timer’s face in the 1719 heading above the 1700 level. This target was delineated from metal detector signals and reported historic production. High-grade from the preceding month came from a spot immediately above the 1700 Level as located by metal detectors.
An old tailings dam from the Royal Gold days gave way at the same time. Heavy rains over winter saturated previously dry tailings, causing the wooden bulkhead to fail and spreading 600 tons of tailings along 350’ of drift on the 1900 Level. This access became important to us in order to continue mining the 1719 Level and two large blocks of ground below that area. Our present crew expects to complete this clean-up work by the end of November 1995.
The 2483 Winze project incurred setbacks due, again, to increased influxes of winter storm generated ground water. Our pumps suddenly became marginal in keeping up with demand. We dealt with this by building a reinforced concrete bulkhead on the 2400 Level. The advantage is increased pump storage from the 2400 Level to the 2200 Level. The disadvantage is loss of target areas on the 2400 Level north of the 2483 Winze.
Gold is expected to come from two areas and hopefully more: the 1719 and the 2483.
PRESENT AND PROPOSED HEADINGS
· 2600 Level drifting north and south
· 1585 Raise (almost completed)
· 2211 Raise (one more month)
· 1900 Level tailings removal (one more month)
· 1719 Gold stope on hold until 1900 Level is cleared
· Proposed headings include the 1571, 1900 M drift, and the Rainbow
For the purpose of testing geophysical instruments underground we have constructed a test zone off the 1500 Level south. It consists of a series of holes drilled in a measured pillar at various depths from the face.
Geonics – In September 1995 we rented an EM61 from Geonics, Canada. We have used the EM61 before underground with some success, however the instrument was new and changes were in the works. The EM61 can see a 6# rockbolt through 9’ of rock. At the same time we sent two high-grade specimens to Geonics, which they used to measure signal responses from. The Electro Magnetic signal produced by the machine generates eddy currents in the target. The signal strength and time taken for the eddy current to drop off is measured. High-grade gold has a very fast drop-off rate. (10 microseconds) The EM61 is not capable of handling such a fast gate. New instrumentation they are working on will. Time frame is 2-3 months.
Acoustic Tomography – Bill Honjas from William Lettis & Associated, Inc. is very eager to employ high resolution Tomographic Imaging Techniques underground. Bill seems to be very qualified and the project has merit. My hesitations are discussed below.
Jim is an individual from Yreka that the company has entered into confidentiality agreement with to test his Pocket Gold Locator I and II. His background is in radar techniques. Contrary to some other radar experts, Jim is persistent enough to overcome early obstacles and obtain encouraging results on the surface.
It has been our experience over the past three years that the field of geophysics is vast, complex, and expensive. Due to the aforementioned observation, various “experts” all have their own narrow field of interest and knowledge. This leaves us with two alternatives:
1) Continued hiring experts until we have blanketed the field and crossed a suitable system for this deposit, such as the conventional metal detector.
2) Retain either a consultant or the university system to identify all geophysical parameters of our deposit and research principles of geophysics as they apply to this deposit. Then mathematically determine what parameters would be suitable for locating and identifying high-grade pockets, and research what instruments are commercially available to fit those parameters.
Proposed costing for this research would be around $20,000. This figure is a fraction of what has been spent in that direction to date.
I propose to delay milling until some time in 1996. There are still two months of work to complete the fine ore bin and be ready for processing. Several thousand tons of or ore is stored on the surface and underground. It would unnecessarily stress the work force to rehab the mill, surface underground ore, process ore, and deal with tailings.
The Rainbow target, once delineated, may be reached by conventional drifting and raising. Put into balance with some viable small block targets and a well-running 2483 Winze, this exploration target would make a lot of sense.
Rock from the 2600 Level is handled 7 times before it enters the mill flow sheet. My philosophy is to verify and block out the ore continuation below the 2400 Level down to a 2800 Level. Once blocked out, do some long-term planning of how to improve material handling from the level by i.e. a vertical shaft, before mining that block and deepening the 2483 Winze below the 2800 Level.
I feel very confident that the ore zones will continue down depth. Once we verify that extrapolation, it would be too easy to continue mining with the present inefficient system in place. Remember, multiple handling of rock was one of the main pitfalls of the old company when it ceased operations.
|Second of three reports for your review during a very exciting time in Alleghany. Our metal detector technology changed every aspect of how to mine the Sixteen to One high-grade pockets. Many of the specimens now for sale in the gold colection were found during this time. ~
Executive Summery ~
Third Quarter, 1993
Labor force - Personnel at the office have increased from two to three, and the mine from 12 to 13. During this quarter and into the next, we are doing major evaluation of long-term projects and upgrading of mine maps onto a CAD system.
Short-Term Development Mining Projects:
2203 – This area, mined by Ernie and Glenn, has produced some the most beautiful and highest grade gold encountered by us so far. It is expected that this crew will remain there until at least the end of this year.
1333 – A new block of ground discovered by Randy. It is located in the vicinity of the Ophir and Sixteen junction with the hanging wall mined out. Randy and Tom have underhanded approximately 500 ounces of heavy gold with arsenopyrite. They have set up a slusher and are ready to start raising up the gold. This block is approximately 100’x 100’.
1783 – Gordon and Fred have virtually completed this area, which produced 323 tons of good mill rock and 70 ounces of high-grade.
849 – Comically also know as the $8.49/ton slope, this was a GPR target with some high-grade in the face. We spent a month on verifying the target, which proved to be wall rock inclusions.
2283 – Mark and Scott have almost completed rehabbing this area and are getting ready to continue this raise for another 60’ to the 1700 level.
RIMtech – It is anticipated that during the next quarter Mark and Scott will have evaluated the three major targets in the 2283 area.
High-grade – As may be seen from the enclosed monthly gold production table, in the third quarter we produced 1880.42 fozt in bars and 579.41 fozt in specimens. Year to date gold production is 2945.32 fozt in bars 759.35 fozt in specimens for a total of 3704.67 fozt. A sample high-grade lot report and summery of monthly gold production are included in this report.
Specimens – Tom Woodfin will be spending more time on cleaning and marketing specimens. He will accountable for all specimen gold, with crosschecks by Mike and myself. I will process the high-grade lots at the earliest opportunity after the volume accumulates to 230lbs, but will not be responsible for specimen gold kept in the vault beyond the maximum value to be determined.
It is my estimate that we have between 1335 and 1558 fozt in the bank and vault in the form of specimens. At present we have an estimated 400 fozt of specimens in the mine vault.
Mill Rock – At this time 900 tons of mill rock, minimum grade 0.2 fozt/ton, are stockpiled on the top landing.
Mill Concentrates – We reworked three barrels of mill concentrates and then sent a total of 16 barrels (gross weight 16,760lbs) to Asarco in Montana. Estimated gold value is $35,000.-
Metal Detecting – This quarter we commenced a program to drill and shoot weaker signals in a systematic manner. This program has been put on hold with the gold find in the 1333.
Safety and Compliance:
CalOSHA and MSHA – We continue to get excellent reports from rigorous inspections. This crew’s member one priority is safety, and we remain free from lost time accidents since Butch’s mishap during the 90-day program.
Water Quality – The EPA has mandated a new series of compliance figures for water discharge. These figures are being forwards to us in our new permit and we will be given 2-3 years to bring this facility into compliance or approach the legislature to change these values.
SMARA – We continue to get out from underneath the classification on Surface Mining and Reclamation Act with its accompanying $2,000 annual fee.
BLM – We have paid the $100/unpatented claim as well as performed a $100 worth of annual assessment work per unpatented claim for both our land in Alleghany and the Brown Bear.
Security – Two elaborate security systems were purchased and installed. These systems are concealed and will record motion around the lower portal, the upper landing, and inside the vault. Tapes are reviewed on a weekly basis or whenever foul play is suspected.
Gold – For the month of October it is expected that gold production will be minimal because of the amount of deadwork in the 2283 and 1333. However, the 1333 and the 2203 have excellent potential for gold discovery.
Targets – Again, we are rapidly running out of areas to go mining along this line of targets. This may change at any time with the discovery of additional mining blocks or the success of alternative exploration methods such as RIMtech.
Chuck Baird will be giving a presentation on the merits and status’ of several long-range development programs. All of these programs would create an unnecessary burden on the Company if we were to start them with resources at hand.
First of some past reports prepared for director meetings by mine manager, Johan Raadsma.
Executive Summery ~
2nd Quarter, 1993
Personnel at the mine have increased 11 to 13. Chuck Baird was hired to delineate targets below the 1500 and 2400 levels, and Scotty Robertson is a new miner. There were no resignations or lay-offs.
Ernie and Glenn are raising from the 2200 to the 2050 level, a distance of approximately 150. 100 ounces of solid slugs were found on the footwall, raking flatly up dip to the North.
RIMtech has completed the survey on this level.
Mark and Scotty broke the 1584 raise into the 1250 level. Utilities were extended from the 1500 into the Red Star stope, through the 1584 raise, for future work. The level is now well ventilated.
The 1500 level is surveyed and mapped. Chuck has made cross sections of the ore zones in that area to determine drilling targets, if any.
Gordon is minimg above the level in the 1785 area, when his other engineering duties permit.
On June 1, Randy and Tom commenced a program to selectively drill and blast weaker signals. This entails running airline to a block of ground and drilling all signals within the range of influence of the utilities. Their starting block is the Eagle Raise area.
Small Block Mining:
We have five small blocks that will be mined and the ore taken to the mill. There are numerous other small blocks that will be mined, but the ore may need to remain in the stope. These blocks all show gold or metal detectors indicate signals. Mark and Scotty heave set up on the 800 level to tackle the first one.
The level is pumped out, however a permanent pumping station has not been installed yet. Gordon has run some utilities to the level and is prepared to survey. Chuck will map the level and delineate drill targets.
Over the period of 4/1/93 thru 6/7/93, 258 tons of ore and 306 tons of waste were stockpiled on the surface.
Exploration Methods and Equipment:
Gordon is keeping detailed accounts of all the exploration techniques and equipment employed in the mine. The following is a brief summery.
1) Ray Wyatt – electron activity Adapting
2) San Jose GPR Phone check
3) Mad Hungarian – electron activity Inactive
4) Tom Fenner – GSSI GPR Exploring
5) RIMtech – Radio Imaging Modeling
6) Psychics I Inactive
7) Psychics II Inactive
8) Geonics EM61 – Canadian MD Adapting
9) Jim Allen – Consultant In contact
10) Lawrence Livermore Lab Call
11) Menlo Park Technology Call
12) Cosmic Ray Monitors Adapting
13) Prof. H. Frank Morrison – Cal Berkeley Coming
14) Microwave dielectric meter Inactive
15) RIMtech – 3’ detector Discussing
16) Deliverance Brothers – adapted White In use
17) GISCO Sending info
18) EG & G Geometrics Inactive
1) Minelab In use
2) Garret Gold Stinger Call
3) Midas Call
4) Compass – Gold Scanner Call
5) White’s Gold Master II In use
6) Tenetics/Bounty Hunter Call
7) Hot Head Profession Search Coil Call
8) Omnitron 2/Filter King Data rec’d
9) Laser Temperature Sensor Sending info
10) Hand-Held EM equipment Call
11) In-Hole MD – Falcon Gold Probe Sending info
The attached diagrams represent data collected by four RIMtech employees over a four-day period. Radio imaging waves were transmitted and received between the 2200 and 1700 levels, and the 2200 and 2050 levels. The result are difficult to interpret due to the many factors such as vein thickness and splits. So far we know the system works, but we don’t know how effective it is until we mine some targets. We will meet with two RIMtech employees all day June 22nd to discuss these results and prioritize targets.
GSSI sent their best man, Tom Fenner, out for two days. Although he is very encouraged by the data he received, we yet have to fulfill that encouragement. One target on the 1700 Level proved to be a wallrock inclusion. Another target at the 800 Level shows promise and we will mine that this month because we have MD signals on three sides.
With one crew detecting/mining we expect to maintain a 200+ monthly production. This will hopefully be supplemented by gold from two other mining crews working “long shots with large pocket possibilities”.
Besides going for the “sure thing”, we will remain flexible and use the two mining crews to prove or disprove new exploration targets such as determined by RIMtech and GPR.
We are progressing from metal detecting to metal detecting/drilling to small block mining to long-term development. Chuck is mapping and analyzing the area below the 1500 level Red Star and 2400 level Sixteen vein for future development. This will include the suggestion for 300-400 foot drill holes with a core drill that we own. The method of mining the development targets will depend on how successful we are in our small block mining program.
~ Other Projects ~
· 577 acres of patented, 400 acres of unpatented.
· Historical production of 500,000 ounces Au from 500,00 tons.
· Ray Wittkopp indicates potential of 10,000ozs/year for 5 years.
· 30 minutes outside Redding, CA.
· Environmentally friendly district.
· No known existing environmental hazards.
· Property has a minimum of $50,000 net timber value.
· Optional at $600 for two or three months.
· Indicated purchase price at $300,000.
· Patented property tax of $1,927.19/year
· 16-1 has this property.
· Good time to attract joint venture partner.
· Management costs will be shared with Sixteen to One mine project.
· Sixteen to One mine will not be able to do this for many years.
· All permits are in place.
· Ore can be milled at the Sixteen mill.
· Buildings are in good shape.
· This company needs activity in Forest on its unpatented claims.
· Strong vein system and past production in Forest.
· Unpatented claims.
· History of museum quality high-grade specimens.
· Possibilities of lease option.
· Warrants quick, low budget look.
Upon further development of other technologies we need to be ready to acquire other properties exhibiting similar favorable vein and gold characteristics as ours.
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© 2020 Original Sixteen to One Mine, Inc.
PO Box 909
Alleghany, California 95910
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