Original Sixteen to One Mine, Inc. - Forum Topic: "How to Approach Thin Veins & Cost"



	June 22, 2018 Friday

Forum
Topic:
How to Approach Thin Veins & Cost

By Michael Miller
01/05/2015 3:11PM

Yes, Hans, much has happened the last year and the last five years as well. This 2015 year has the likelihood of historical importance for our 103 year old company. We will have a different look but what look remains unknown by 2016. The international gold market is of no concern to me. How is the money industry holding out in Germany? I laugh no snarl when I read about the depressed price of gold and how it is predicted to change. Who are these writers and what id their background? I doubt many are gold mining producers. A twelve hundred dollar exchange for one ounce of gold makes me wonder. The wonderment is not that it isn’t higher or lower. My wonderment is why does California have only one commercially operating gold mine in one of the world’s most spectacular and proven gold deposit?

We all know that the international banker’s crash in 2008 set the character for the following years. Does anyone recognize the start of basic economic activities that will end this speculative boom and bust? I have some ideas and it isn’t the record number of the DOW.

One of my good friends and mutual shareholder of this great little undervalued company figured a process to mathematically find “key neutral” positions. Bets can be placed (either up or down, for or against or other quirky opposites) minimizing risk once the key neutral point is reckoned. I remember our discussions that took place many years ago on this process of contemplating a risk/reward endeavor. We may come to the same conclusions but the factors used to reach those conclusions can differ greatly. This becomes somewhat personal. This is a good thing for many. Finding your key neutral position is a start.

Well, Hans, I am so pleased to see your input back on our FORUM. I also cut back my participation last year but continue to check it daily. You will see more from me in 2015 than last year.

By Hans Kummerow
01/04/2015 12:05PM

Happy New Year from Germany to you all, dear California gold-seekers. Has anything of importance happened at good old Origsix during the last five years?

By fredmcain
05/30/2014 9:26AM

Michael,

A most interesting post from you as usual. I have a couple of thoughts on this. The first one is that I think I can see somewhat of an analogy here between mining and agriculture. There are many “BIG” farmers today who are using these absolutely humongous machines, many of which sell for a hundred or even TWO hundred THOUSAND dollars (or more) a copy. Needless to say, these guys end up taking on a lot of debt.

Many of the smaller farmers who are STILL farming with 1950’s era tractors (or at least 1950’s sizes of tractors) are doing every bit as well as the big guys, never mind some of the Old Order Amish who are still farming with horses!

The second thought is that I am still puzzled and bothered by the difference between so-called “trackless mining” and more traditional, rail-based mining. As you know, most if not all of the “Big Guys” have gone completely trackless. And, as you know, trackless mining demands absolutely HUGE adits and drifts to allow the trackless machines room to maneuver and pass each other. And the trackless machines themselves are not exactly small ticket items. How can this be more profitable than using rail haulage? My suspicion is that it might not be. So, why are they doing this?

To return to the agriculture analogy, why are big farms using quarter million dollar farm machines bought on credit? Does “herd mentality” play a role here? Or, is there an element of pride of farmers (and mining companies) all wanting to be the best at doing the “LATEST thing”?

One thing that would seem obvious to me is they go for this stuff in order to increase their volume. The big machines do indeed succeed at that. But if those huge machines increase your volume by a factor of ten and also increase your costs by a factor of ten, how much further ahead are you?

I am reminded of the old joke about the farmer who was driving watermelons to the market in his old, beat-up Ford pick-up truck. He found that he was losing about 10 cents per melon. Then he found what he thought was an obvious solution. He went and bought a much larger truck so he could haul more melons!

Is this what might be taking place with trackless mining? I also belong to a couple of other mining forums. One small coal miner from Pennsylvania told me that he likes the quaintness and the history of rail haulage but as a miner he’d rather work with trackless equipment (possibly in an air conditioned cab, eh?) because it’s more “flexible”. There’s nothing that’s worse, he told me, than dealing with a strategically placed derailment in a rail mine.

Another hard rock miner from Arizona told me there’s no way he’d even consider going trackless if for no other reason than he didn’t know how he’d deal with the fumes. He’d have to put in a much larger and more expensive ventilation system. So, right there you have two conflicting viewpoints from miners.

I still haven’t found what I feel are satisfactory answers to my trackless vs. rail questions but there is one thing I am sure of. The Original Sixteen To One mine is doing just fine using the methods that you’re using. Good for you! “If it ain’t broke don’t fix it”.

Regards,
FMC

By Michael Miller
05/28/2014 10:34AM

Even though my mining in California spans forty years, it still surprises me when the need and importance of defining our work becomes an “Ah ha” realization. No wonder so little of the general populace is in the dark about this vital industry. I just had an “ah ha” experience with the hidden costs of employing a miner. California has a very suppressive workers compensation history. The rates are high. Several governors tried to improve the system yet it remains a big reason why industry moves to another state.

State Fund notified us the base rates (per $100) will increase for underground miners ($41.38 to $52.85). Surface miners decrease ($22.86 to $22.16). Clerical decreases ($1.06 to $1.03.

I submitted the following work description for our miners during the construction stage of mining. It coincides with exploration and development, those methods of work prior to production. Tunneling is less expensive. The reason is somewhat clouded but I was told that there is a lot more tunnel work in California than underground mining. Therefore, accidents are spread over more hours in computing the risk for the insurer.

“Tunneling is an adjunct to or fore work to mining. It is a horizontal or inclined drivage for development or to connect mine workings, seams or shafts. It may be opened to the surface at one end and used for drainage, ventilation or haulage or as a personal egress (walking or riding) from mine workings. The tunnel miner is experienced in the use and handling of rock drills and shovel loaders and in tunnel blasting methods.”

My “ah ha” is the realization how much gold mining has changed to big automation equipment. The ‘miner’ sits in an air conditioned cab all day each work day operating his machine. It is skilled work and I’m not critical of the ‘miner’; however, he does not resemble the miners of the past. Our miners are a slice of the past. They multi-task, work in a small environment and the machines they operate are those used years ago. Why do the traditional California gold mines resemble the miners of the past? The gold deposit dictates how we mine the most efficiently. The 21st century is alive and well in the Sixteen to One but the method of mining reflects a prosperous past.

By fredmcain
03/17/2014 9:19AM

Does anybody on our forum know of any other companies doing underground mining in California with trammers, ore cars and tracks? I have stumbled over a couple but they are dog-gone hard to find. I suspect they are out there but how do you find them?

I have this theory about underground mines that mine with tracks. I see or perceive, a company using rail to mine as having an honest, long-term commitment to their operation(s). I suspect that some so-called “trackless mines” are attempting to do business by getting in quickly, recovering any remaining resources that they can, also quickly, and then get out again.

Surely this is not the case of all trackless mines but I suspect it may well be the case for many of them. Does anybody else have any ideas on this? Is there a connection between mining with underground railways and commitment?

Regards,
Fred M. Cain

By fredmcain
03/17/2014 9:18AM

I would like to add a recent development to my post below on North Bay Resources and The Ruby Mine. I found out today that North Bay is planning to “spin off” The Ruby Gold Mine Co. with a new I.P.O. of stock. The proceeds of the sale will go to paying a one-time “stock dividend” to current North Bay shareholders. It will be interesting to see how this pans out.

North Bay’s common stock is now around two cents. (OSTO shareholders take comfort!). Obviously investors don’t seem to enthusiastic about this.

However, from what I can tell Ruby Gold seems to have some good people working there. Of course, I don’t know them personally so maybe someone on our forum can expound on this.

I can tell you one thing, though, when I e-mailed them at their website they were responsive. Surely that’s at least a step in the right direction.

Regards,
Fred M. Cain

By fredmcain
03/04/2014 11:06AM

David & Group,

Yes, that's true! To this I could only add that you might look at the really nice photos on this page here:

http://www.northbayresources.com/ruby/rubytunnel.html

Please take note that in order to visit that page you have to copy and paste the address to your browser 'cause URL's do not "highlight" on our forum.

If you can find it, scroll down and check out that awesome switch just outside the adit! I'd love to visit this mine someday, too, although I don't know what their attitude is on mine tours. Hardly as liberal as Mike Millers! :(

Regards,
Fred M. Cain

By David I
02/28/2014 6:17PM

If you have interest in the ruby mine, you need to look up the web site for NBRI. Clik on the Ruby mine project. Read the geoligist report. The ruby is in Production.

By fredmcain
02/28/2014 9:29AM

I just recently learned of the Ruby Mine also located in Sierra County. I guess North Bay Resources has been involved in project to reopen the mine.

I sent them an e-mail asking if they would continue to use their mining railway in the mine and the response I got back was something like "Yes, absolutely".

Like Emgold,their stock is currently trading around 3 cents. But like the Sixteen To One it may be undervalued.

I am thinking about getting some. Comments?

Regards,
Fred M Cain

By fredmcain
12/09/2013 5:45AM

And here is a simlilar article focusing on track:

http://www.miningweekly.com/article/track-will-result-in-savings-on-rolling-stock-2004-04-02

Track will result in savings on rolling stock

By: elizabeth rebelo

2nd April 2004

TEXT SIZE

In South Africa, the total yearly tonnages hauled on underground rail systems exceed the tonnages hauled on surface rail systems by about 30%.

However, South Africa’s underground rail infrastructure is infamous for its water-related problems, lack of maintenance and poor haulage performance.

Tubular Track, a Pretoria-based company, has developed a ballastless railway system, which is used in both surface and underground applications, with rails that are continuously supported on reinforced-concrete beams.

To further consolidate Tubular Track’s position in the South African market, a black economic empowerment company, Afri Technologies, has been formed to install tubular track, with George Negota as chairperson and Alex Mzizi as MD.

Tubular track has been installed in mines in South Africa, Zambia and the US, says CEO Peter Kusel. The first tubular track was installed in President Brand mine, in Welkom, in 1989. The system uses standard rail and turnouts, which are consistently supported along their length by a concrete beam under each rail that is held in place by specially-designed steel-gauge bars.

The gauge bars consist of steel channels that are welded to steel gussets and straps. For underground applications the gauge bars can be dished to enable a continuous drain to be cast between two rails for the effective disposal of water, adds Kusel.

The system is designed to suit the prevailing geotechnical conditions that occur in underground mines.

One of the most significant benefits of installing this product in underground operations is that smaller volumes of material are required for the construction of the rail.

“Owing to the fact that the mining industry is predominantly a mining and tunnelling one, it is important to improve the efficiency of transportation,” says Kusel.

He tells Mining Weekly that, with tubular track, hoisting time is decreased by 70%.

An enhanced by-product of the locally-patented tubular track is the iMPi modular- section mine-track system, which has shifted away from in situ cast track to precast modular track and turnouts, says Kusel.

The iMPi system, which was developed about two-and-a-half years ago, has undergone intense analysis and testing at the University of Pretoria’s faculty of engineering’s railway division.

Extensive lifecycle testing also took place at the Spoornet track-testing centre. The iMPi system is being installed on an ongoing basis at various gold and platinum operations.

Africon Engineering International is the system designer, and the same consultant administers and audits the quality-assurance programme.

Africon’s contract manage-ment director, Terence Kelly, tells Mining Weekly that the company has installed an underground management system at Mponeng which is in line with the ISO 9001 standards.

Kusel describes the modular-track system as a technological improvement on tubular track, which can be installed in all mine railway applications.

Further, no slinging is required as the modular sections are loaded onto standard flatcars and transported to the site.

“This means that shaft time can be reduced by up to 85%,” says Kusel.

The product can also be in-stalled by mine personnel after training.

All installations are quality assured by Africon International Engineering.

As with most other new technology, the modular-track system is still facing some resistance in the mining industry, in which sustainable production and returns on investment are significant priorities.

Often, mining companies want to see the immediate benefits of new technology.

Kusel says that tubular track provides operations with long-term benefits, which include substantial savings on rolling stock, due to the design of the rail, which, in turn, reduces the total cost of the operation.

With regard to surface applications, extensive testing of tubular track for main-line conditions has taken place at the Spoornet track-testing centre over the last 18 months. “Because of the good results obtained, it is hoped that a number of orders will be obtained from Spoor- net and the SA Rail Com-muter Corporation,” Kusel reports.

A contract for manufac-turing precast modular 1:12 turnouts for installation and testing under coal traffic in Ermelo yard is under way, he continues.

“There is no doubt that tubular track is becoming, and will continue to be, a viable and popular alternative to conventional sleeper systems,” says Kusel.

Tubular Track was founded and developed by Kusel, the incumbent CEO of the company.

Kusel is a railway engineer who spent much of his career as a railway contractor on the coal line to Richards Bay.

By fredmcain
12/09/2013 5:42AM

Group,

It's been a while since anything has been posted on this. Here is a piece from an online mining magazine. Although the focus is in South Africa, it clearly points out that in at least some parts of the world, mining with tracks is still important. Here we go:

http://www.miningweekly.com/article/the-status-of-underground-rail-transport-2000-06-23

The Status of Underground Rail Transport

By: System Author

23rd June 2000

TEXT SIZE

Transportation systems have been found to be responsible for 26 % of fatalities and 49 % of all reportable injuries within gold-mines, Robertson and Hitchins underground GM Neil Maslen tells Mining Weekly.

In addition, Department of Minerals and Energy (DME) mine equipment safety acting principal inspector Fred Wilmans reports that the Leon Commission of Inquiry into safety and health in the mining industry in 1997 identified haulage and transport accidents as the second- largest cause of accidents in mines.

“Within our hard-rock mining industry, rail-bound transport can be identified as the weak link, with the current utilisation level of locomotives and hoppers estimated at 28 %, compared with the 92 % level for vertical transportation,” says Maslen. He is disappointed with the status of underground rail transportation within South Africa’s hard-rock mines, specifically because railway technology had its origin within the underground coal-mining environment in the UK with great success.

Underground Railway Association chairperson Murray Franz maintains that there has been a steady decline in standards in South African underground transport since the years of high gold prices.

He believes that a general lack of regular maintenance is responsible for the dilapidated systems.

Similarly, he maintains that trackwork conditions, track installation and maintenance, communication, training and control constitute the most significant problem areas within underground transport systems. Maslen believes that the problem has developed because current management structures do not consider the logistical process with the same focus as the other two core mining activities; rock-breaking and mineral extraction.

In an initiative to solve these problems, Wilmans reports that a tripartite task group was established under the auspices of the Mining Regulatory Advisory Committee (MRAC) to revise the existing Department of Minerals and Energy (DME) guidelines for underground railbound transport, as well as the existing railbound Minerals Act regulations.

Such standards are necessary to ensure that the 37 000 km of track underground, as well as all the related equipment, is managed, controlled, maintained and operated in a safe manner.

Maslen is certain that established process-system management, coupled with superior standards of trackwork, will enable successful underground rail-bound lateral transport.

Furthermore, Maslen stresses that it is imperative to consider the important role of risk-assessment within the logistical process when considering the current situation with respect to health and safety.

In terms of the newly-promulgated Mines Health and Safety Act, it is the responsibility of mine management to initiate risk assessments, involving State, employer and employees, which will identify all potential hazards. Wilmans reports that the tripartite task group has submitted the draft guideline to the MRAC for comment and approval.

“This document, once approved by the Mine Health and Safety Council, will be issued by the Chief Inspector of Mines to the mines in terms of section 9(3) of the Mine Health and Safety Act,” he says.

“Draft legislation has also been forwarded to MRAC for approval, which includes proposals on brake performance, ratio of unbraked mass to locomotive mass, speed indication and illumination,” he adds.

“Progressive change is required in the form of a dedicated transportation management structure, responsible for all horizontal movements of people, material and rock.

By fredmcain
07/26/2013 9:31AM

Group,

I belong to a different underground mining forum where we have also been discussing “mines with tracks”. One guy from Canada responded stating that there are a number of Canadian mines still using rail. Among them are the Dome Gold Mine, Kirk Lake Gold also has a rail mine, “Xtratra’s” Kidd Mine and Goldcorp’s Hoyle Pond Mine.
The forum can be found here if anyone is interested:

http://www.ironminers.com/mineforum/index.php (you will need to copy and paste that address to your browser.

The forum also had gobs and gobs of beautiful color photos taken in underground mines – many of them abandoned. I might also add it was from that forum that I first learned about the Original Sixteen To One Mine.
I truly believe that the forum is worth checking out.

Regards,
Fred M. Cain

By fredmcain
06/14/2013 4:11AM

Michael,

I wish you the very best with the meeting. I only wish I could come. My thoughts and prayers will be with you nonetheless. Hopefully I can come next year!

I hope you are able to give us a full rundown of the developments at the meeting on the forum.

Best Regards,
Fred M. Cain

By martin newkom
06/13/2013 10:01AM

Interesting activity in recent oil
and gas exploration: You all have
perhaps heard of "fracking". Well
they are using the process and with success and they have further refined theprocess with a new method known as "octopus" ie using the same drilsite to bore in several directions thus increasing the output of a single site.

By Michael Miller
06/12/2013 2:38PM

Fred,
I sure appreciate your interest to details. I have answers but right now not much time. We are preparing for the annual meeting (my thirtieth as president). While it has become a fun day for me, there is much to do to make the grounds comfortable for the owners. Some will be first time visitors to the mine and others show up on a regular basis. We expect over 130 and less than 200.

We allowed the water to rise almost to the 1300 level about six years ago. Miners worked below the 2400 level in late 1990’s. We sunk a winze below the 2400 level to visit the quartz below the fault…found gold but the price dropped significantly and it was more expensive to mine that location than other targets. Pumping is like having a baby for a women or a kidney stone for a guy. While it may be always uncomfortable, the first time is the worse. Dewatering the mine will not be a problem and there is track along the lower levels.

I’ll catch up with the FORUM after this weekend. Always enjoy everyone’s input.

By fredmcain
06/12/2013 4:38AM

I was wondering if someone could tell me how much of the Original Sixteen To One Mine is actually open. If you click on "MINE" on the sidebar of the website, you will be taken to a page that offers a Map of The Sixteen To One Underground from 1998. I must say, that is a very impressive network of underground drifts and winzes! But how much of that is actually in current operation or eligible for operation?

Further back in this thread I found a post from 2010 which stated that "The current operation and the long range plan concentrate in the North Central. We will be there for another 100 years. The South Central is idle with no plans for immediate mining."

Unfortunately, I don't know what that means. What and where are the "North & South Central" districts?

I'm afraid that the deeper recesses of the mine might be flooded with water like the Empire & Idaho-Maryland Mines. Indeed, Michael Miller alluded to such in our annual report where he mentioned that parts of the mine need to be "dewatered". The map shows a 2400-foot level, a 2700-foot level and a very deep 3000-foot level. Are those all flooded?

If that is the case, it would be really exciting to get the deep levels dewatered and send someone down there with the GPR equipment. Since these levels are so deep, it would be my guess that they haven’t been nearly as thoroughly explored and the possibility of a major strike would be higher down there. Then again, perhaps I’m wrong about that. Perhaps the gold-bearing quartz veins are only found at more shallow levels. Does anybody know?

Finally, what do the heavy lines and very faint lines on the map signify? Do the heavy lines signify the presence of rail car tracks or do the faint lines merely indicate that those passageways are abandoned and unsafe?

Regards,
Fred M. Cain

By fredmcain
05/21/2013 4:11AM

Michael,

If you have time, I'd like to hear more about your experience getting disoriented in a mine when you were young. That must be an interesting story!

On the mountain lion, it is my understanding that mountain lions can actually be very shy and are usually no threat to human beings unless cornered, trying to protect their kittens or rabid. That being said, though, it is easy to see how a big cat could suddenly feel cornered if you encountered her in a mine.

If that animal was healthy, and she probably was, I agree that she has almost certainly left the mine by now.

Regards,
Fred M. Cain

By Michael Miller
05/20/2013 6:01PM

Going back to Scoops entry on 05/18/2013 at 2:07PM and later comments, I agree that it is unlikely for a lion to wander deep in a mine. If tracks were found on the 800 foot level (portal level), the oddity of the current situation would disappear. But the 800 level has lights intermittently along the strike of the vein to the deep Tightner Shaft. Once at the Tightner Shaft, there are lights down to the 1000 foot level. It is reasonable for a wandering lion to go south on the level. It could decide to travel down a stope and reach the 1100 level. But what next? There are no lights. It is total blackness.

If I’m that lion and just took that trip, I want to get out of here. Years ago I got disoriented in a mine. Panic set in immediately, especially since I thought I knew where I was walking. The lion did not panic or only for a nanosecond because of its superior survival skills. I believe it smelled its way out. I trust the lion has left the mine. The crew will discuss this situation tomorrow. Guns are not allowed in the mine unless a procedure is followed. The crew is safe from stray bullets; however each member of this crew is capable of protecting himself with a weapon.

I like your comments. I’ll make a waiver, check for gun and find a live deer to take into the mine right after I call the game warden again. I admit that this most unusual find on the 1100 foot level sent a chill up the back of my neck.

By David I
05/20/2013 11:58AM

May be the Couger was looking for a place to have cubs. I recommend that you set a trap for the cat with live bait type of trap with a cage containment. It would have to be well built.

By cw3343
05/20/2013 10:09AM

You better add that to the disclaimer/waiver for the shareholder meeting - ha ha!!

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