Original Sixteen to One Mine, Inc.
ORIGINAL SIXTEEN TO ONE MINE IS OPTIMISTIC ABOUT FUTURE - Miners News
While some Americans are pessimistic about the future of mining in the United States, especially in California, the Original 16 to 1 mine management sees a great future for its operations. It should know. In the last 107 years, the Original Sixteen to One Mine has seen depression, recession, high gold prices and low gold prices. It has seen California evolve from a pro-mining, wild frontier into the politically correct, mine-hostile haven it is today. Yet, despite all those changes, the mine has survived and is looking towards many more years as the country’s oldest publicly listed gold mine.
The mine began in 1896 when Tom Bradbury discovered the outcropping in his backyard was gold bearing. Ironically, it was named after the silver/gold ratio proposed by pro-silver Presidential candidate William Jennings Bryan, who was advocating policies that would hurt gold miners. Unlike most mines, it was a high-grade gold mine where there is about two to three ounces of gold per pound of quartz matrix. The gold was so rich that in early years the gold was hand picked out of the rock, sacked, and sent directly to the San Francisco Mint. Today, some of the ore, which shows gold strings running through the quartz like a rich web, is polished and sold as jewelry.
The mine has gone through several booms and busts over the last decade. In most cases, it was innovative thinking, not rising gold prices, that helped lift the company out of the red. Twelve years ago, the company had laid off its crew and was seeking investment capital to open up the flooded 2,400 foot level, when two part time miners came to them with a proposition to explore the mine in return for the bulk of the gold that they found with commercial gold detectors. Although the method was an unconventional way to explore traditional gold mines, it was ideal for the type of rich gold deposits found in this mine. As a result, the company rehired some of its crew within a month and equipped them with specially calibrated metal detectors. Thanks to this new technology, they immediately found gold and, since this method of exploration was cheaper than traditional methods, the company showed a profit in 1992.
Much of 1992 and 1993 was dedicated to renovating the mine and exploring existing tunnels with the hand held gold detectors. The detectors could find gold within 12 to 36 inches of the face and during those years the mine successfully explored 70% of the tunnels with the detectors to see what gold deposits lay just beyond the face. By using such methods, in December 1993, the mine found a gold pocket that contained 2,500 ounces. In addition to detectors, the mine also uses ground penetrating radar and radio imaging to get a better idea of what lies underground.
The good years encouraged the mine to expand and in 1995 the company began operating below the 2,400-foot level and began digging into new ground. However, the declining gold prices once again struck and the Sixteen to One had to retreat. However, many of the employees had enough faith in the company and the mine that they went to work as independent contractors, who were paid a percent of the gold recovery. “This is where entrepreneurship works<” Company President Mike Miller said. He noted that the next few months were some of the most productive.
Although operations were scaled back, the company wasn’t dead. Directors refused to take cash payments in order to save cash reserves and the mine also started to harvest timber on its property in 1999. “That timber got us going again,” Miller said. With the money, the company was able to rehire its core employees. Unfortunately, just as things began to look better, the company was hit with a manslaughter charge from the accidental death of a miner. Although the judge recently dismissed the charges, partially because the California prosecutors withheld evidence of innocence from the grand jury, the actions of this politically motivated district attorney occupied management’s attention and scared potential investors.
Despite these past problems, the company is optimistic about the future. It has survived over one hundred years thanks to innovation – from paying workers a percentage of the discoveries to using metal detectors for prospecting underground. It was also one of the first mining companies to fully exploit the Internet to stay in contact with its shareholders. “The mining company of the 21st century can not be run like the 20th century,” Miller said.
The company is currently seeking investment capital for future development. The plans for 2003 include work on the Red Star Shaft – an idea that has floated around since World War One. The goal is to expose the central part of the company’s claims under a thick lave cap. The shaft will pass through the rich auriferous river called the Blue Lead. “Personally, I am smacking my lips about this placer target,” Miller noted. “My heart has always been in the Red Star.”
Despite volatile gold prices, the company’s future looks good. “Our company owns a large underdeveloped area in the Alleghany Mining District,” noted Miller. “There are always numerous choices of where to mine.” The red Star Shaft will be a gateway to gold veins of Bald Mountain to the north. He also notes, “California has the most proven gold deposits with the fewest people working it.” In addition, the gold quartz matrix is becoming more popular in jewelry and is found in more stores than ever before. This helps protect the company from the fluctuations of the gold commodities market and sells for as much as $1,000 an ounce.
In the long run, no one knows what will happen. Unlike most gold mines, the Sixteen to One doesn’t have traditional reserves because of the nature of its deposit. “It’s a unique mine and our reserves look the same way they have always looked.” Miller said. He did note that geologists have stated the mine has only mined about ¼ of the vein system over the past 100 years, that means that there remains plenty of potential for the future.
Miller remains very optimistic. “I’m a true believer, not just of the 16 to 1, but the gold industry.” He feels that the mine that began operations when Mark Twain was still entertaining crowds about his own gold prospecting adventures in California, will still be going when the politically correct politicians and lawyers of California are gone.
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