June 22, 2018 

From the Sixteen to One Archives


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07/01/2004  10:15AM

Two Ways to Look for Gold
San Francisco Chronicle September 2, 1980
By Stephen Magagnini
Gold mining on a small scale is relatively hassle-free: “Pick a river, any river, any place on that river,” advises one pan-and-dredge salesman.
But the more grandiose your golden dream, the denser the thicket of local, state and federal agencies you’ve got to penetrate, as two 20th century Argonauts, Mike and Michael Miller, have discovered.
By coincidence, these romantics, who bear the same name but are unrelated and a little wary of one another, have both invested a lot of time, sweat and money re-activating long-dormant commercial mines – Mike was jailed in the process – and both have yet to hit paydirt.
Both are 38 years old, both are fascinated by gold, both are gamblers who have done their homework, hired geologists and staked their careers and fortunes in pursuit of buried treasure.
There the similarities end.
Mike Miller, a native Californian, is secretive, cautious and shuns publicity. He lives in a free-flow log cabin he built for himself down a dirt road not far from one of his mines.
He had mixed success running restaurants and selling real estate in Santa Barbara before he “got tired of dealing with people.” In 1974 he began scouting gold properties in Sierra County’s Alleghany Mining District, five square miles that contain some of the richest gold deposits in California but have hardly been worked since World War II.
The district’s only active mine, the Oriental (a 10-man operation), has been among the largest gold producers in the United States over the past five years.
In 1975, Mike bought the Morning Glory Mine and leased the Osceola Mine. The Morning Glory, which opened in 1891, had been submerged in water for some 40 years and several of the tunnels had caved in.
But there’s a gold-bearing quartz vein anywhere from half-an-inch to a yard wide that runs through the hill at a 30-degree angle, said Mike’s partner, Tom Woodfin. The trick is to follow the vein until it leads you to the gold.
“This area here is what they call a ‘pocket area,’ which means you can be following along the vein and not find anything,” Woodfin said. “ You go in, you drill holes, you load them up with dynamite, you light the fuse at night and you go home and you never know what you’re going to find the next morning – it could be a streak of gold as thick as your finger or it could be nothing. I’ve been in a lot of old mines where I found gloves, picks, shovels… like they just didn’t come back the next day.”
Steve Rosenbaum, Mikes’ geologists, compared gold mining in the Alleghany to hunting for “a raisin in a pudding. There hasn’t been a good correlation between any element or mineral that will increase the halo (the chance of finding gold).
“Eighty percent of the gold in this district came from veins 100 feet from serpentenite is no guarantee there’s gold to follow.
Miller and Woodfin pumped out the water from the Morning Glory, reconstructed the 300-foot tunnels and built a wooden bridge over a creek so trucks could haul the rock tonnage from the mineshaft to the rest of the 40-acre property.
But in November of 1977, Mike was arrested and charged with illegally using federal timber, doing “ substantial” work without a permit, dumping material into the creek that threatened fish and plant life and causing a barrier in the waterway that prevented run-off.
He was jailed and bail was set at $1000 on the misdemeanor charges, which were advanced by the state Department of Fish and Game.
Twice, Miller was prosecuted.
The first time, the j8ury was split 10to 2 in favor of conviction, said Sierra County District Attorney Jim Dremman; the second time, Miller was acquitted. Miller has since sued Dremman, Sierra County, the Fish and Game Department and the federal government for $6 million, charging illegal trespass, abuse of process, malicious prosecution, conspiracy and violation of his civil rights.
Last September, Miller and Woodfin finally got back on track and rehabilitated the main shaft. They plan to hire a dozen men to excavate between 15and 30 feet of rock a day.
Mike won’t say exactly how much money he’s invested so far – “less than $1 million”—or predict how much gold he expects to mine. “If we could match the production of the past (two ounces of gold for each foot) I’d be very happy,” he said.
Mike doesn’t know if he’ll be able to start production before he runs out of money. The state Department of Corporations prevented him from setting up a limited partnership of small investors “in a misguided attempt to protect widows and orphans from bad gold investments,” he said. “I was going to pay dividends in gold.”
For the last six months, Miller and Woodfin have been working day and night burrowing into the mine and examining mineral samples under the microscope. “We’ve taken a lot of risks but I think they’ve been calculated,” Miller said. “We watch out for the ‘foolkiller’ – we don’t go in without our hard hats.”
Mike and his family spent one summer living in a cabin without any electricity, and recently ordered several 100-pound sacks of beans. “You can live for six months on beans,” he said. “We could run out of money and even that might not stop us…”
The other Miller, Michael, hasn’t run out of money despite bureaucrats, floods, quicksand, and most recently, a fire in the tunnel that threatened to came in his mine.
Before he started the Miller Mining Co., the flamboyant Brooklynite – who attended New York Law School at night – practiced law for a dozen years, argued cases before the U.S. Supreme Court and “was successful in the academic sense, but not the financial sense.”
Michael went west in 1975 and discovered he had the Midas touch, at least when it came to producing television shows. IN three years, he produced a series of “self-help” shows on such topics as sewing and ethnic cooking he says grossed $80 million and netted him in excess of $10 million.
“IN 1978, I started looking at the tings to do with cash and was convinced gold was the way to go,” he said.
Michael toured Calaveras County in a Roll-Royce until he settled on the 100-year-old Altaville and Calaveras Central Mines. He lives in a Bel-Air mansion, jets up and down the state in a Cessna Citation and has autographed pictures of neighbors like Shawn Cassidy, Steve Martin and Suzanne Somers hanging in his office.
Michael thrives on publicity – reporters are handed a glossy package of Miller Mining Co. reprints – because he wants to “establish a market position – I want to build this into the gold company in California.”
Without the environmental restrictions, Michael said he could have opened his mines for $2 million. But the required settling ponds, water discharge plant and environmental impact report ran the bill to $6 million -- $3 million of it Michael’s. “So they’ve upped the ante considerably,” he said. “If I had bought gold futures contracts at $180 an ounce, I could have made $10 million on a $250,000 investment, but what fun is it?
“IN August (1979) I had to gamble on two factors: One, is the gold down there, and two, will gold go up? People said I was a lunatic. It took a big set of nuts to put the money up.”
Besides the U.S. Mine Safety and Health Administration and the California Occupational Safety and Health Administration, Fish and Game Department and state air and water quality control boards, Michael had to contend with the suspicious citizens of Calaveras County. For months, the county threatened to revoke his building permit over supposed water and noise problems.
Ultimately, however, the citizenry realized that Michael, who has hired 105 persons, was doing the county – whose economy was suffering as a result of few housing starts and failing timber industry – more good than harm.
“Our independent… report indicates our operation will be responsible for 650 to 900 service and retail jobs – stores, restaurants, etc.,” Michael said. His payroll is $150,000 a month and each dollar generates $7 worth of business in the county.
Oliver Garcia, mayor of Angels Camp, remarked, “everybody wants it (the mine) as long as you don’t put it in their backyard. We like to see people gainfully employed. You can’t have your cake and eat it too.”
Once Michael had extricated himself from the bureaucratic quicksand, he ran into the real thing.
After his miners, averaging 10 feet a day, had bored about 489 feet into the Altaville Mine, they found themselves below the waterline. First there were floods and then there was quicksand.
“At one point I fell in up to my wais t and they had to pull me out with a tractor,” Michael said.
Then one August afternoon, when Michael was within tasting distance of the ancient river channel’s bedrock with its fabled “paystreak,” disaster struck.
Sparks from a cutting torch ignited the bales of straw used to fill up voids in the walls about 550 feet into the tunnel. Underground fires are extremely dangerous and difficult to put out; in 1922, 47 miners lost their lives in a fire that caved in the Argonaut Mine in Jackson.
Fifteen minutes after the fire started, 14,000 gallons of water were dumped down a drill hole above the fire. That didn’t work. The next day, 20 tons of liquid carbon dioxide were poured into the tunnel. That didn’t do it. Neither did 55-gallon drums of foam with an expansion ration of 100 to 1.
Benny Licari, Michaels 28-year-old project manager, said there was enough oxygen in the bale hay to keep it burning for months.
After more than a week of frustration, Michael’s miners poured a bulkhead of cement on either side of the fire, than plugged the smoldering area with 25,000 cubic yards of grout.
The next sep will be to drill through the cement.
No one was hurt in the fire, but production has been delayed by at least a month. “It don’t take a mathematical genius to say it’s (cost us) over $250,000,” Licari said.
Before the fire, Licari said “We hit a little pocket of it (gold). We took about a 40-pound sample and recovered a nugget a twelfth of an inch in diameter.”
Norm Brown, a Sacramento engineer who earns $400 a day as a mining consultant, said Miller “really is a pioneer. Michael’s got a lot of guts. There will be more like him. He only has to bring out 12 ounces of gold per day to cover his costs.”
Michael expects to do a lot better than that. His miners, using diesel-powered buggies, will be able to remove 1000 tons of ore a day – each ton yielding a quarter-ounce of gold, for the nine-year life of the mine, Michael said.
Since his existing sand and gravel operation already covers about 60 percent of his costs, he stands to clear bout $200,000 a day – if the paystreak is there.
“I have no doubt it’s there,” Michael said. “Between you and me, it’s an absolute sure thing.”
 By Michael Miller

03/03/2004  11:25AM

The following reminiscences of Noble were written in 1925. These stories are some of my favorites, which I never tire of rereading. The company owns the Hanley, Graves and Noble claim, which comer Lafayette Ridge and Chips Flat. We know where the upper tunnels are located and have prospected the open areas.
Compiled by M. Miller.

Reminiscences of H.H. Noble
From 1877 to 1883 the stock brokerage business declined so that for many months it was difficult to make even the expense of the office.
I was interested in a number of mines and among them the Rainbow mine, near Alleghany, Sierra County, and as its history is rather remarkable, I will relate it.
It was some time in the ‘50’s that a company of miners was running a bedrock tunnel to drain the gravel deposit in an old channel at Chipps Flat, which lies just across Kanaka Creek from Alleghany. When the tunnel was in, immediately under the channel, they struck a very rich quartz vein from which they took out about $300,000.00 in free gold and a large amount of arsenical sulphurets that were then supposed to be of little value, in fact there was a large piece of over 30 lbs. that lay at the door of an old cabin for twenty years, until one day a metallurgist came along and in burning a piece on a blacksmith’s forge, he showed the owner that it contained more than $2.00 per lb. in gold.
This had the effect of reviving interest in the old mine.
After working out the ore above the tunnel level, they got to quarreling over the division of the money and future working of the mine and finally, after many years of litigation and the death of the original owners, Mr. W.E. Hanley and his son-in-law, J.O. Groves, acquired title to it and incorporated under the name of the Rainbow Gold Mining Company, which I believe was in 1878.
A number of us took stock in the Company and assessed ourselves to equip and sink a shaft and drift for the ledge, about 90 ft. below the old workings. This we did in 1879 and got to the point where we believed we would find the ledge.
It was late in the fall and there came a heavy storm that prevented us from getting in our winter’s supplies and wood to run the hoist and pump. Therefore, we took out pump and allowed the drift and shaft to fill with water.
We had spent over $35,000 and most of the stockholders got cold feet and abandoned it for good, but I had great confidence in the truth of what had been told me of the history of the mine, so I bought out one or two of the weak-kneed stockholders.
The next spring, (1880) the rest of us assessed ourselves to pump out the shaft and drift and continue the search for the ledge and on the very next day, after commencing work in the face of the drift, we struck the ledge and took out nearly $40,000 in free gold.
In this lot was one piece about 2 ½ ft. long by 1 ft. in diameter and at a little distance it resembled a sleeping child and was named “the baby”, and I believe produced about $9,000.
We bought the Twenty-one Mine and the water rights for $5,000 and later sold it for $25,000.
We then erected a 10 stamp mill on Kanaka Creek and then connected the hoisting works with the mill with an aerial tramway and I believe it was either the first or second one that was ever erected. It was erected by A.S. Hallidee, the inventor of the cable street railroads in San Francisco,
In passing through Nevada City on one of my trips to the mine during the construction of the mill, an old man by the name of Pelton called on me and asked me to go with him to the foundry and see a new water wheel he had invented. I immediately saw its advantage over the old style and gave him an order for a wheel for our mill. It was the first Pelton water wheel that was ever used and today they are used all over the world.
We continued to take out ore above the drift and some of it was very rich and Mr. Groves was convinced that much of it was being stolen and many years after, we found tons of tailings in an old cellar at Chipps Flat that had been pounded up in a hand mortar.
After the mill was completed and running smoothly we concluded to run through the rich ore we had saved and ran the mill for four hours and thirty-three minutes. We cleaned up the mill retort and melted the gold, which weighed 149 lbs., -exactly my weight at the time.
We worked the pay shoot up to the old workings and were troubled with a great deal of water and when we commenced to work below the drift, the flow was so great that our pump could not handle it. We then concluded to run a tunnel from the side hill to connect with the bottom of the shaft. This is now known as the Groves Tunnel, - some 700 ft. from the shaft out.
This had to be done by hand and was very slow and expensive, but when completed of course drained that drift and the upper workings and enabled us to work below that level and when we were down 14 ft. we struck some exceedingly rich ore and between 6’clock one night and 6 o’clock the next night we took out $98,000. Pretty good for twenty-four hours.
We continued working to a depth of 70 ft, when we struck an underground flow of water that drove us out of the winze. I had gone down just after the blast and flooding of the bottom of the drift. I was anxious to know what the blast had thrown out and reached down to get a piece of the ore, which I could only do by going under water all but my head. I got the sample that you have all seen and can testify to its richness. (That piece of ore was loaned to the State Mining Bureau).
Just before this time we had shipped two lots of ore to Thomas Price & Son. See his certificate stating that 1962 lbs. of ore produced $116,662.28.
During this time I had increased my holdings to a little over two-thirds of the stock; Messrs. Hanley and Groves had the balance.
And now comes the other side of the picture. We found we could not drain the mine without installing powerful machinery and pump that would be very expensive. Therefore concluded to run a tunnel from our mill on Kanaka Creek to the ledge, about 2500 ft., which was quite an undertaking in those days, as we had to install a compressor, pipe line, power drills, etc. We were nearly two years at this work and when we got to the ledge we found it barren and then the only thing for us to do was to upraise the old workings.
In the meantime my business had dwindled to almost nothing, owing to the exhausting of the Comstock Mines and I decided to close my office and go to the mine and make the upraise, where it seemed almost sure we would find pay ore and I could soon recover my fortune. I think it was early in July 1884 that I left for the mine. Messrs. Hanley and Groves joined me and we hired men enough to work two 9 hour shifts, - I agreeing to work on each shift, which I did for over a year; in the up raise in the dayshift and running the compressor on the night shift, which was rather an easy job as I could sit with my hand on the lever and doze comfortably but with the slightest change of speed or rhythm of smooth running, I was as wide awake as I am at this moment.
The men used to joke me by saying that I turned on the water, set my alarm clock and went to bed. At breakfast the last day of the year, one of them said, - “Just to prove that you don’t go to bed, wake us up at midnight and wish us a Happy New Year.” The bunkhouse was just across the road from the compressor room and had bunks two high on the three sides of the room, with more upstairs, with a large stove in the center. There was a large steam whistle in our storeroom that had formerly been used in our hoisting works and when blown, was heard for miles distant. None of the others knew of our still having this. So after they had all retired I got the whistle out, connected it to the compressor with a long length of hose and placed it on the top of the stove; then got up 110 lbs. pressure and at 12 o’clock turned her loose. There was about 3 ft. of snow on the ground at that time and out they came, - the most frightened lot of men you can imagine.
I shut off the air and went out and wished them all a Happy New Year. One old fellow said, “Well Noble, I really believe you are awake.”
When I left home I took with me one of our dogs, Juno. She was a large and beautiful St. Bernard. We went by train to Nevada City, then by stage to Moores Flat, about 20 miles, and from there we walked to the mine, --8 miles. After a few days I missed her and the following day she returned, hungry, footsore, and just able to crawl. Later I learned that she had returned to Nevada City and boarded the outbound train and as she did not have her ticket she was put off the train and returned to us. She evidently got homesick and went back as far as she knew the way.
On the 15th of August I said to the men, - “Tomorrow will be my birthday and of course I will expect a present from you all.” When I came out of the tunnel the next day Juno met me and almost forced me to go with her to a secluded place in the mill, where I found ten beautiful puppies. Quite a birthday present!
Late one night in January I received a telegram that Mother was sick and for me to come home at once. It was storming at the time and during the night over 2 ft. of snow fell. Notwithstanding, I started at daylight for Moores Flat, with a good pair of skis and plenty of lunch. It was impossible to follow the trail so I followed the line of least resistance to our old hoisting works and then to the summit of the ledge and then down to the Middle Yuba and there found that the bridge had been carried away by the high water.
I selected the least turbulent place, undressed in the snow, wrapped my clothes in my rubber coat, tied them to the curved end of the ski then plunged in, pushing the ski ahead of me and swimming to a point about 200 yards down stream. This proved a wise thing to do as the current was so strong that I could not have made it had I attempted to swim anywhere near straight across and below the point there was no place to land on account of the boulders and precipitous banks. No one can fully appreciate the difficulties I had who has never seen mountain streams after a storm.
After landing I was soon dressed and on my way up the mountain, but not at a very rapid gait as it seemed I was like the frog that jumped out of the well, -going ahead one yard and falling back two, or was it the other way? Anyway the effort was so great that I was soon warm and arrived at Moores Flat just before dark. That was a long day’s journey.
The upraise was a two compartment; one for a man way, the other for an ore chute. As the ledge was perfectly barren and when we were near the old workings, we commenced to get a little discouraged, especially as we had to climb nearly 470 ft. from the tunnel, (the height of the upraise when completed) and pack the drills, timbers, etc.
Meanwhile the tunnel and upraise had drained the upper workings so we could get to the place where we had been driven out by water and found the rich ore we expected and took out about $5,000 and then discovered that was the bottom of the pay shoot and had we been able to sink 5 ft. deeper we would have abandoned the mine and never run the tunnel, as there was a distinct fault in the vein.
You can imagine our disappointment and after running a number of drifts and not finding even a color of gold, we shut the mine down and as there was a revival in the stock brokerage business, I came back to the City and opened up my office again. This was in 1885 and I did a fairly good business until 1890.
I had kept some men at work in the Rainbow prospecting. In January 1891, I went up again myself and worked there for about six months and at all times I had at least one man working for over 16 years and finally I found the ledge and took out about $20,000. At least that was what I received down here. Messrs. Hanley and Groves had died many years before, also a trusted superintendent and as I was informed that the one I had in charge was buying valuable really estate back in Canada and my time was so occupied, I concluded to close the mine down and soon after sold it for $65,000.
The End
There is more to the story. The first Pelton wheel is still located where it was originally installed. Its significance qualifies it as a candidate for National Historic recognition. Parts of Hallidee’s aerial tramway still exist above the Rainbow portal. His design was the precursor to the construction of the aerial ski lifts found throughout the World.
 By Michael Miller

02/25/2004  4:16PM

From the Sixteen to One Archives
Our company files contain letters and reports that many of you will enjoy. They should add to your sense of mining and living in the gold country. The following compilation from “Men and Miners of Nevada County and Adjacent Territory” may tickle your fancy. The awesome historical values of the Sierra Nevada gold belt are as rich and deep as our valuable veins.
The author, Arthur B. Foote with George Starr collaborating, wrote the report in 1936. Foote was born in New Almaden, California in 1877. He was awarded a B. S. degree in civil engineering at M.I.T. in 1899. He died in Grass Valley in 1964.
At my first directors’ meeting in 1977, we completed merging the Tightner Corporation into Original Sixteen to One Mine. During my proxy fight, which began in 1976, I met all of the Tightner shareholders. They never agreed to the exchange of shares with the Sixteen to One. What a lesson in tenacity they were! They believed the Red Star, which the Tightner owned, held the greatest concentrations of gold in Alleghany. Each one gave me his proxy to vote against Original Sixteen to One Mine’s management. They all believed they were cheated out of their mine through the Compromise Raise, which Foote calls “the boundary raise.” Enjoy a rare moment of history, as I have.
Michael Miller

When Mines Are Flooded
For a mine to be flooded so that its pumps are under water is a major disaster, and may cause a shut down lasting many months. New pumps must be obtained, and, in those days you could not get a pump that would go in a 5-foot by 5-foot shaft capable of lifting a large volume of water 1500 feet on short notice. The winter of 1907 had been wet, so that there was already a large flow of water when it started to rain on March 6 and continued steadily and sometimes very hard to March 26, ending up with snow. Toward the last, the electric power kept going off and on the 22nd was off for 13 hours. The pumps at the upper end of the North Star shaft could not begin to take care of the water, and it was running down to the bottom of the mine. The air pumps at the bottom of Central Shaft were started again and what other air pumps that were available.
All drilling was stopped and men put to work building dams across the drifts to hold back the water. Steam was got up and used for hoisting water to save compressed air for the pumps. Then things began to happen. First, the water falling down the 1600-foot vertical shaft, from the baling tanks, reversed the draft so that the fumes from the heaters filled the pump station. Then the S.P. Bridge went out, and we could not get fuel oil. We burned mining timbers under the boilers, but could not do that in the heaters for the pumps, so put a pipe down the shaft and turned steam into the heaters; the pipe was put in, in a hurry without expansion joints, and the heat of the steam buckled it out into the shaft so the cage would not go through. Finally, when we did get fuel oil, it could not see a lighted candle two feet away. The pump men went around with a hose blowing air in their faces. But the water was held below the pump station, and there has never been such a flood as that since.
Profits in Tightner Shares
The latter part of 1911, J.M. O’Brien of San Francisco got A. D. Foote interested in the purchase of the Tightner mine, in Alleghany, from H. L. Johnson. A company was formed with 100 shares of stock, with A.D. Foote as president, and 35 stockholders, most of them were Nevada County men. The list of stockholders contains quite a number of the names already mentioned in this narrative. Each share of stock was to be assessed $50.00 a month to pay the expense developing the mine. Abe Hall was superintendent. I find that I did not keep my personal accounts very carefully in those days, but I think the final result of that enterprise is about as follows: Assessments were paid for five months, making $250.00 per share as the total investment. Then the mine began making a profit and dividends were declared soon after. The 25 percent royalty paid to Johnson took care of all payments for the mine and mill. Dividends amounting to $2,270.00 per share were declared, and then the mine was sold to a company headed by Fred Searles for $300,000, amounting to $3,000 a share more.
A new ten stamp mill, designed by Foote with solid cast iron battery posts, was erected. Taylor’s Foundry built the mill. In 1912, 10,000 tons were crushed, of which one half averaged about $2.00 a ton. This was quartz taken out searching for the high grade. The month of February 1913, there were 990 tons crushed that averaged $86.68 a ton, and the 15,000 tons crushed that year averaged $37.48. In three years, the mine produced about $1,000,000, and not much more than that before it was sold.
16 To 1 Bonanza
The common boundary between the Tightner and 16-to-1 was rather indefinite, and it was necessary to define it before the property could be sold. The line passed through a part of the vein that was considered to be barren, and therefore not very important. After and agreement made by the two companies, a raise (called the boundary raise) was put up on the line agreed upon and produced little ore of value. Later on, the 16-to-1 discovered within 60 feet of that line, probably one of the richest small bodies of ore ever found. William Simkins, who was making a geological survey of the mine, was responsible for the finding of that bonanza. If that boundary line had been 120 feet further south, two million dollars would have been taken out by the Tightner instead of by the 16-to-1.
When Fred Searles had charge of the Tightner, with A. F. Duggleby as superintendent, it produced a good profit, but nothing spectacular, and it was then sold to the 16-to-1.
Foote Road
When Foote was president of the Tightner, he built the Foote road, to make it more accessible. There have been accounts written about that, so I will not go into it any further, except to give what credit belongs to George Scarfe, Jr. He was on the job all the time supervising practically all of that job, re-located the road as far as possible to make it less expensive, and devised the means of doing the best job for the least money.
I will relate in aftermath of the Tightener episode that happened in 1931. I received a registered letter with return address of A. Man, Sacramento. When I opened the letter there were $2700.00 in bills and the following note: “The enclosed is money borrowed from the Tightener mine in the years 1914 to 1915 now entrusted to you as a stockholder at that time, to divide among you and the rest of the stockholders of those years and it is the hope that none of this will bring the misery it has brought to me. A. Mistake.”
Praise For Early Prospectors
This gives me an opportunity for paying my respects to the early prospectors of this region. In all the years that I have been here I have never seen or heard of a vein that outcropped being discovered that was not already known, or showed signs of having been investigated by one of the early prospectors. Did any of you hunters or fishermen ever go anywhere that you did not see some indication that a prospector had been there before you? There are thousands of quartz veins, but it is a safe bet that every one has been prospected, and when you see a nice looking outcrop, it is a waste of time and money to sample it, because some one has done it before. Think of all the work and hardship it took to do the job! There is a lot of talk nowadays about the government being the rightful owner of the natural resources, but does anyone believe that these early prospectors would have worked the way they did if they had not known that the gold mine would belong to them, and not to the government, when they found it?
Crash of 1929 And Its Effects
When the crash came in “1929,” prices dropped, and there were almost no market for anything except gold, a new interest was aroused in both placer and hydraulic mining. Most of the Placer mining was done by snipers with a very small reward. The principle hydraulic mines that I can think of that started up were those at You Bet, the Remington Hill, the Relief Hill, the Omega, and the one at Smartsville. New interest was also shown in quartz mining and many old mines were re-opened and new prospects investigated. Then when the price of gold was advanced to $35.00 per ounce, it encouraged still more capital to come into the district until now there are something over 3,000 miners at work. I think there were almost as many men at work back in 1912 or 1914 as there are now, but the payroll now is over 70 percent greater for the same number of men. This, of course, has stimulated business in the district much more than the smaller payroll would have done and that accounts partly for the great increase in population.
I have mentioned a good many names of men who started in this district and went on to other parts. I think some mention should be made of those who stayed at home. Thomas Marshall, I believe started working at the North Star some time in the ‘80’s as assayer and accountant and he did all the melting and shipping of the bullion at that time. He continued in that position, as the company grew larger and more prosperous until 1929. Toward the latter part of this time, he had too much to do to attend to the assaying and meting, but I cannot even remember the time when he failed to take the cleanup into town for shipment, altogether, he must have taken over thirty million dollars to town. I drove him in myself all the time that I was connected with the company. For many years, the company paid out one half million or more a year, and there was not ten cents of that amount that Mr. Marshall did not account for.
Better Class of Miners Here
I would like to mention a lot of the old miners, mill men and mechanics that have worked faithfully and steadily in the mines for thirty years or more, but there are too many of them to mention in so short an article. If I began I would not know when to stop. It is admitted by every one who is in a position to know that there is a better class of miners in this district than in any other mining camp in the world.
Before closing, I cannot refrain from pointing to a moral. In the early days, I think my readers will agree, men worked harder, worked longer hours and for less money, and many luxuries and pleasures that we now enjoy could not have been bought for money. As a result of inventive genius and the improvement of machines, the production per man increased enormously and the miners got the largest share of that extra production. It is being argued now that machines are putting people out of employment. It is certain if machinery had not been improved, the mines of this district would have been forced to close years ago. It is claimed that the rich are getting richer and the poor, poorer. Since 1884 the North Star Company has produced $30,900,740. All but $6,000,000 of that was paid back to the employees and, except for what was paid for machinery, etc., in other places it was all spent in California.
Capital Always Needed
The prospectors know when they have found a mine that they cannot develop it themselves—they have to have capital from outside. That capital must come from people who have saved up money and wish to invest it and make a profit. It seems to me that $25,000,000 paid out is worth the $6,000,000 profit that the people who supplied the capital received.
 By lynwood

09/03/2003  7:21PM

The US Forest service works under the Department of Agriculture. Its leader workd under the Executive branch. Current bureaucratic actions with regard to America's precious natural resources appear to weaken the security of Americans. The topic of the meeting I summarize below confirmed the that Smokey the Bear has inhaled too much smoke. Here's my column to the local newspaper.
September 2, 2003
Downieville, California

Chairman of the Sierra County Board of Supervisors, Pat Whitley, spoke from her heart and trust in those attending the regular meeting in Downieville, when she said, “I am very proud of you and the manner conducted here today by you in this audience and speakers.” At issue is the continuance of rural cleansing for the residents of this high mountain county. The latest attack comes from the destruction of their culture by agents of the federal government. Testimony after testimony directed specific facts and evidence against the actions of the district overseers of the Tahoe National Forest, the US Forest Service. The room was packed. In addition to local familiar faces, the audience was stocked with members of the white hair, cue-tip club of summer folks, who were lingering in the county a little longer than their summer vacations of the past.

Federal employees sat amongst the audience in the small wood paneled public chamber. Some wore their customary green and others were un-uniformed. The courthouse entrance was also packed with those who expressed their support by their presence alone. They did not speak, possibly because they could not squeeze inside. They chattered amongst themselves or took turns poking their heads inside for an ear full.

The meeting was a public forum of elected officials, the forest service employees and the public. As a bystander, albeit one with a solid opinion, the facts presented by the government people conflicted with the locals’ presentation. The noon siren broke up the gathering before everyone could complete speaking. An architect named Bill related that the loss of the miners’ way of life being destroyed and plundered in the name of benefiting the publics’ best interest is seriously flawed. He compared it to attitudes in other countries where great appreciation of their cultures is in the publics’ best interest and preserved not destroyed by the government.

When C.K.Smith stood up and spoke, he said that the forest service has been hostile to the residents for eight decades. He noted it was from first hand experience from when he was a boy. He is past eighty and worked at the Sixteen to One mine as a youngster. He lives in Sierra City and has great stories about the mine. Although these were not her exact words, Sandy Bowman expressed concern from the intimidation and the fear of the forces of the United States government exerted by the forest people. The forest people protected themselves with a mantle of policy justification for their actions. Those speaking for the forest service interspersed “the Law” with regulations, standards or policy in their offense of righteousness. Forest service behavior is ultimately ruled by law not internal policies when they conflict. Clearly everyone else speaking was defending the further loss of miners’ heritage or the culture represented by the carnages inflicted by the forest service.

Several noted the Sierra County General Plan as the guiding public document for consideration in Sierra County by the public, including the forest service. Supervisor Brooks Mitchell and Supervisor Arnie Gutman both participated in the formation of Sierra County’s General Plan when they served as planning commissioners. Michael Miller, who shared and chaired the commission during the years the plan was developed in a county wide traveling show, stated that the quality of life was featured as the dominant concern, interest and guiding principle by everyone. Ranching, farming, logging, mining and recreating are specified as the foundation of Sierra County’s definition for the quality of life so highly prized by these rugged Californians. He said that the planners recognized that, “Our culture over the next twenty years is our greatest endangerment. It’s not the trees; they are doing well. It’s not the critters; wildlife abounds throughout the county. We must protect the living evidence so our children know their heritage.”

Donna Hayes, a former county supervisor, was called. She was visibly ready to explode after hearing the misstatements made by forest service personnel. She passed when it was her time to speak and sat down to collect herself. U.S. Congressman John Doolittle sent a representative, who offered to look into any type of conflict the public had with the law. It was pointed out that the U.S. Secretary of Agriculture is the appropriate branch of government to express concerns because the executive branch oversees the forest service personnel. Congress passes laws and the executive branch under the overall responsibility of President Bush is responsible for their execution.

Planted at the head table with the county supervisors was Steven Eubanks, who introduced himself as the district supervisor over the Tahoe Forest. He was the main spokesman for his six underlings present. He stated his goal is, “to be consistent in how we approach the issues.” He said he moved into this position five years ago. He said, “Word was out to do what you want” in the Tahoe National Forest. It was not clear if he meant just in the local area or throughout the forest.

Charges were made that certain district forest service employees were removing artifacts in violation of the federal Antiquities Act. Trees used to blaze an old miners’ trail through the Eureka Diggings were unnecessarily cut down by the forest service. Eubanks’ employees were carting off other long existing mining artifacts from public land and taking the artifacts home. The main issue to rally the large turnout was the systematic destruction of buildings. Eubanks’ position is, “where occupancy is occurring unauthorized, or in trespass, we are obligated to eliminate inappropriate and exclusive use of public lands.”

Eubanks says that this is not unique to Sierra County. The people here are not singled out or being picked on. Miller, president of the oldest operating American gold mining company, took issue with Eubanks. “What is unique with Sierra County is our great mineral wealth, and the residents of the county have recognized this. When it comes to gold mining, this place is unique.” He said the forest service employees did not use Best Management Practices, which they are lawfully required to do. He recited the purpose of the Multi-Use law was not to exclude one of the few statutory rights that Americans have to use the public lands: the exploration and mining of minerals. Many in the room may have missed what next occurred. Miller presented Eubanks a claim for damages of $512,000 to the U.S. Forest Service for the loss or destruction of property at the Telegraph Mine. He sat down to boisterous and broad applause.
 By Oak

07/25/2003  2:12PM

I am new to the 16 to 1, a stockholder, a reader of this very interesting Forum, and a first time contributor to it. Gold sure brings out the passion in everyone. I have been following the exchange between Gold Master, Mike, Rick, et. al. and there is a lot going on. Passion is what is needed to drive a company or any endeavor, but passion and emotions need to be tempered in making and executing the decisions that run the company. Ten Lb. has some valid points. I personally don't know if Mike is running the company properly or not. My gut says he is - which is not to say he or the Directors can't run it better. There is always room for improvement in any venture or pursuit. I attended that last annual meeting for the first time and was very impressed by the mine and Mike's presentation - so impressed that I invested in stock - I got the fever - so there is my committment to the cause. I have to agree with Ten Lb. though on keeping a low profile with regulators. I work for one of the largest design/build construction companies in California and two of the first rules of construction are; 1. never assume anything, and 2. NEVER piss off the building inspector! It is a fact of life that we all live in a regulatory environment - there is no getting away from it - so get over it and deal with it. The old days of just going out and doing it are over. I can identify with Mike and Rick about wanting to get even for wrongs done - but what is the long term gain and is it good for the mine? Yea, there would be a lot of satisfaction in doing so if you win, but in the process of either winning, or losing, a lot of exposure to the mine will result. A lot of that exposure could be negative - which goes back to pissing off the inspector. Safety codes, procedures, and inspections in mining or construction are a given. The best way to stay off a regulator/inspectors radar screen is to pro-actively comply 100% with the codes. That way when they show up they will have very little to find. And they will find something, no matter what you do - it's their job and mission in life. A little something is ok - it justifies their trip out. What I am suggesting is don't rock the boat - think about the ramifications.

Gold Master, you obviously have mining experience and have brought up a lot of points for all to think about, but what is your ultimate point of doing so?If it's just to get the Forum to wake up then you for sure have done that!

At the annual meeting, Mike mentioned several other income producing ideas such as selling rock to landscapers and bottling the water etc. (actually a damn good idea - it sure would cut the water quality regulators off at the pass if you were selling some of the best in the west - and it came right from the mine). I again agree with Ten Lb. that creativity will go along way in helping to pay the bills.

Mike a suggestion. It would be a very positive step if the News letters were more frequent. You mentioned in one of your last responses several days ago about finding some gold down in the Ballroom which I take is the dig you were doing at the time of the annual meeting. Finding gold is what the 16 to 1 is all about and keeping the stockholders appraised on a regular basis as to how the effor is going sure would relieve a lot anxiety about how our investment is going. Just a suggestion - we ARE interested!

And in the words of CCR - "Keep on Chogglin'"
 By gfxgold

07/15/2003  5:04AM

Man, oh man!!! A guy goes to the mine for a week to see how his crew is doing and all hell breaks loose! Dead bodies on the Forum is just not acceptable. Play nice! Everyone has their opinions and insights. All are welcome. Disagreements are allowed but, if the topic gets to hot, start another one. Sometimes, I get the feeling that some of you are mistaking Forum participants as being connected to the 16 to 1 management. The only one that I know of is Mike Miller and he rarely participates in the discusions. However, He does read the Forum entries. I'm sure he enjoys the numbers and percentages you guys throw around. It's a bit too much for me to understand. It felt like I was at a masquerade ball at midnight when Gold Master and Rick took off their masks and revealed a little more about themselves (Topic-Big Whopper;No Problem). I guess I could do a little of that... I am not connected with the 16 to 1. I do not own stock in the 16 to 1. I do not own any kind of stock. My investments are mainly Real Estate, Timber and Mining. I own several gold mines in Alleghany. I've known Mike Miller for almost 25 years. If I didn't have my own mines to invest in, I would seriously think about the 16 to 1. Speaking of stocks, there is another large operation underway in Grass Valley, CA. Emgold is opening the Idaho-Maryland Mine. Reading their mining plan reminds me of an earlier operator of the 16 to 1 mine. He thought that bigger was better. Mill more ore, get more gold. It worked on paper but... The 16 to 1 is stuck with that oversized milling equipment. Emgold is looking for $45 million to make their plan work. So far, the Canadian mining companies who have come to the Sierra's have not had the best long term track record. I wish them luck. As for the 16 to 1, the talk around the mining industry is that the 16 to 1 has been setting the example for standing up and not rolling over whenever an agency levels a fine. More mining companies around the country are starting to fight back instead of just paying the fine and not making waves. I think if Mike can personaly afford to take the CDAA to court and win, then the 16 to 1 would have an open path to pursue the same venue at a later date. As for the "X" factor, to me, "X" marks the spot. Finding a good sized pocket of gold is what needs to happen right now. The miners that are working underground know it's there, somewhere. They are making the least amount of money in their careers in search of it. It's not easy on them or their families. They have faith in the 16 to 1.
 By auriferous

06/30/2003  7:32PM

I do not contribute often to the ongoing discussions on this forum, but I read with great interest the various opinions and ideas set forth in the many topics. It seems that some topics invite more profound reaction than others. A common reaction as of late has seemed to be one of nostalgic romanticism regarding the potential of the Sixteen-to-One and the many struggles which it has faced. I felt the need to contribute a little something from a book that I picked up not too long ago titled “Mining Engineers and the American West”, published in 1970 and focusing on the active roles played by mining engineers, managers, superintendents, financiers, speculators, and investors in the growth and maturation of the mining industry during the period of 1849-1933. I think it fits quite well with the latest discussions, as many folks are interested in seeing the mine persist just as it has since 1896. I think it is important to note that most of the “radical” ideas proposed for expanding the mine and allowing it to survive as a focal point of gold production in California are based on old philosophies and proven practices, albeit clothed in modern technology and jargon. Anyone who becomes motivated to invest money into the mine to realize a return on their investment would be wise to consider the technical methods behind the visionary ideas.

The following is an excerpt from the above-mentioned book. I think it illustrates the point that operating a mine is not child’s play. It is a complex, expensive, and dangerous business. If it is done correctly, it is a rewarding endeavor and a solid connection to our collective history. If it is taken lightly, it can become deadly in a short matter of time.

The work of the mine manager was many-sided. Basically, his task was to take charge of a property, direct exploration and development, and make provision for the extracting, processing, and even sale of its ore. In seeking out ore and following its course, he had to have some knowledge of geology, mineralogy, and surveying. In extracting it, he had to know something of tunneling, drifting, shafting, and other underground work. In addition, he had to be enough of a mechanical engineer to plan for the use of hoisting, ventilation, or draining equipment, and some means of underground transportation. He must be able to weigh the virtues of steam power versus electric or air drills versus electric drills. In order to supervise treatment of ore, he had to be something of a chemist and metallurgist, with an understanding of milling or perhaps smelting machinery. Frequently, he assumed the role of a civil engineer and built roads, tramways, or flumes. At the same time, he was a business manager, constantly concerned with costs, purchasing, accounting, ore sales contracts, or perhaps leases. He was the supervisor of a large labor force and concurrently responsible to his own corporate or individual employer, whose rights, both property and legal, he was expected to protect. On top of all this, he also served a public relations function and was expected to “live an exemplary life so as to command the confidence and respect of the camp and the company.”

That last phrase in quotes was taken from the Northwest Mining Journal of June 1907. I believe it still holds true today – even in the age of metal detectors, MSHA, and the EPA. What other means do we have as supporters of the mining industry to show we are serious about our positions as respectable citizens and protectors of our history.

Thank you,
Jason Burke
 By auriferous

01/01/2003  8:27PM

Without being an expert on global economies and the establishment of central banks, I would like to add a few cents' worth of my thoughts on the issue.

First off, I think that the world is full of power-hungry, rich, ruthless people. These folks are in the minority. Do they hold real power? Do they influence the daily lives of the "masses"? Do they hold sway over the courses of nations and entire populations? Probably. But as one of the "masses" myself, let me say this: my own personal economy (i.e., I go to work and get paid, with which money I am then able to purchase the things that my family and I need or want) doesn't rely directly on whether Alan Greenspan is wearing a polka-dot tie or whether the central bankers in London are having a good day or not. Sure, my job depends on the world prices of platinum and palladium to remain at a level at which the mining method that has been chosen for a tiny geological anomaly in Montana remains profitable. But you know what? If they don't and the mine closes forever, then I can go get another job. Will it be a hardship? Will the economy of the town, the state, and the country be affected? Will the miners be left with nothing? Most likely not, or at least for a relatively short time. What does it mean to say that the rich central bankers acquire that which will appreciate in value while they distribute that which does not or will not? Does it mean they are constantly investing in beachfront property and Las Vegas casinos while I am doomed to buy a new GM vehicle every year? Not in the least.

My economic situation includes, for example, a 401(k) plan. A modest way of deferring not only taxes, but also personal use of my own income. What? Am I letting some rich central banker decide the best way to invest my money? Yup. Am I concerned? Nope. "Why?", you ask. Because, frankly, that's what he does best. I would not trust him to survey my property or draft a set of civil engineering plans and I expect that he would not use me as his financial advisor. Does that make us unequal in status? Well, we're both professionals. His services are valued a little higher than mine, however. Are we both ethical people? I should hope so. But how far do ethics get you in the investment world? At best, I am asking him to predict what economic sectors will have a good year and which ones will not. How is he supposed to know for sure? He doesn't, really.

There is much to be said about whether the price of gold is being "manipulated" and to what extent. But we acknowledge that the very same valuation method is used for things like oil. That is a commodity whose price we, and most of the world, have little or no control over. Is gold different because it is a world currency and the basis for many governments' money? I would venture to say that the American economy is more dependent on price fluctuations of light, sweet crude than on gold. Anyway, what if the price of gold were "deregulated"? What if it rose back up to, say, $600/oz (assuming that a free market would even value it above about $300 anyway)? Would many of the mines in Nevada reopen? You bet. Would the Sixteen-to-One be debt free and loose of all the bonds of political strife and regulatory mire that afflict it now? No. Right now, the mine is troubled not by rich central bankers whose will becomes the guiding light of nations. No, it is troubled by a handful of lawyers and government staff who collectively couldn't agree on a place to eat lunch, let alone regulate a global economy. It wouldn't matter a whit to those people if the Whopper was sold today for a half-million dollars. They would just be pleased as punch to get their share and then stick it to the mine again tomorrow. Because they are evil-doers who would like to destroy the last remaining corporation operating a hardrock gold mine in California? No. Because that's their job, they don't have anyting better to do, that's what the governor wants, that's what 51% percent of the voting population will support, etc., etc., and because, sometimes, democracy stinks when you're in the minority.

The Sixteen-to-One has been and will be a symbol of the [revisionist] history of California and the Gold Rush. But so is the Empire/North Star complex in Grass Valley. Even the State thought so when it bought it and made it a state park. Now, publicly funded, it can demonstrate and educate for a few dollars a day. Michael Miller is getting an education from the State, too. The State is teaching him something that he doesn't want to learn. It is teaching him that most people just simply don't care anymore what exactly brought them or their ancestors to California in the first place. They don't care if the mine remains open or not. They don't care whether Mike goes to jail. They don't care whether the price of gold is $300 or $500 or $1000. Frankly, they probably don't care whether the arsenic level in Kanaka creek is above or below standard. It's the same way that they don't care where their roads, cars, computers, shoes, airplanes, forks, houses, lawn mowers, toothpaste, keys, bridges, light bulbs, space shuttles, aircraft carriers, or nickels come from. Just as long as they have them . . .

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