The Trail of Gold and Silver

by Duane A. Smith

  In some Colorado locations, the industry faced no-win scenarios. In 1976, Allan Bird, superintendent of Silverton’s Sunnyside Mine, put it in perspective, when his company encountered opposition to the destruction of trees for expansion of a tailings pond: “The EPA people looked at it. The water quality people looked at it. They all approved the plans. It was a situation where it was the choice of preserving 30 acres of willows or putting a town out of work.” Vocal critics thought that was no excuse for destroying the willows—or the land that the mine company owned.

  Silverton’s old Sunnyside Mine had gained new life when operations resumed in 1961, and had become Colorado’s largest gold producer by the early 1970s. Standard Metals placed its mine in full operation, working six days a week to produce silver, gold, and base metals. In 1973, for example, it yielded nearly $5 million. Bird and his staff faced environmental issues, however, that would probably have driven old-time managers over the cliff. In June 1974, the snow runoff washed about 100,000 tons of “grey slime” off the dump and into the nearby Animas River. In stepped regulators and agencies; only after hearings and studies were concluded, a shut-down for repairs completed, and a fine levied and paid was mining resumed.

  Four years later, the company suffered a major accident with serious environmental impacts. Working a profitable gold stope, mining moved upward toward the bottom of Lake Emma. Gradually, the miners noted seeping water trickling down the shaft. The seepage became a flood on June 4, 1977, when the lake broke through into the workings, shooting thousands of gallons of water and millions of tons of mud out into the valley and then into the Animas River. Along with that mess, it carried along timbers, mining equipment, and anything else that could be flushed out. The only extremely fortunate thing about this disaster, “one of the most dramatic mining catastrophes” in San Juan mining history, was that it happened on a Sunday afternoon when everyone was home.

  The shocked residents of Durango and Farmington, forty and eighty miles downstream, saw the mess race by. It would take two years of demanding, difficult, dangerous work to clean it up and get the mine reopened. Neither Standard Metals nor the Sunnyside Mine would ever be the same again. They sold the mine to Echo Bay in 1985, but that company could not make work there profitable either. The Sunnyside—the last major operating mine in the San Juans—eventually closed in 1991.

  For a while before it finally closed in the late 1970s, the Idarado mine, whose workings tunneled from Red Mountain through the mountains to Pandora, near Telluride, where the mill was located, gave the San Juans two major operating mines. Although it yielded both gold and silver, its main products were zinc and lead. The Colorado Division of Mines’ 1979 report observed that the Idarado “simply continued to retain a maintenance crew,” with some development work being done. San Miguel listed no gold or silver production that year, compared with, for example, more than $2 million in the last year of full production in 1976.

  What got Telluride people all upset, once skiing replaced mining as San Miguel County’s principal industry, was the dust blowing off the tailings pile, just outside of town up the valley toward the mill site at Pandora. This led to a joint environmental cleanup effort by the company and the town that covered the long-stretching dump with vegetation.

  Over in Mineral County, the Homestake Mining Company operated its Bulldog Mine and mill at full capacity. By 1979, the mine was Colorado’s largest silver producer, showing more than $14 million worth of silver and employing a crew of nearly 170 men. To the shock of Creede, Homestake closed the Bulldog in 1985. The company blamed its failure on not finding new ore bodies, the high costs of mining, and the fluctuating price of silver.

  Meanwhile, the federal government stepped out of the gold market and allowed gold to seek its own price level on the world market. The removal of the government cap on gold (and the price fluctuations on the open market) sent a new jolt of potential throughout Colorado. As of December 1974, for the first time since 1934, Americans could legally buy, sell, and own gold.

  Understandably, this renewed some interest in gold, but there were other factors that had to be considered before venturing into late-twentieth-century precious-metal mining. Miners’ wages had risen steadily, with some earning $100 or more per day. Also, fewer skilled miners remained in the state, a problem that had bedeviled the Homestake operation at Creede. Costs of supplies, equipment, and transportation had continued to climb as well, and Uncle Sam’s regulations were omnipresent and expensive to satisfy. The high-grade gold and silver ore of the early rushes had disappeared, and only the lower-grade rock deep in the earth remained in Colorado’s mines. Taken together, all these factors placed the miner in the age-old bind of higher expenses versus declining ore value. Furthermore, once the Carlton Mill closed in 1962, ore had to be shipped to Canada, Mexico, or El Paso, Texas, to be refined, adding further costs to the already chancy proposition called mining. All this weighed heavily against any new rush. Also, in this situation, the small miner had little chance. The big corporations, with skilled geologists, more equipment (including the latest technology), and the financial resources to withstand initial losses to gain eventual profits, continued their domination.

  Colorado’s centennial year, 1976, illustrated the new era of gold and silver mining. Only the increase in price of the former accounted for an increase in value mined ($14 million-plus), not a corresponding increase in ounces of silver. Gold production had actually decreased from previous years to $5.4 million. Production would not even have been that high except that gold and silver generally came as byproducts from mines that produced other minerals. Compared to crude oil’s $376 million, coal’s $143 million, molybdenum’s $183 million, and even sand/gravel’s $41 million, gold and silver were bit players on the total Colorado mining scene. The precious minerals industry had fallen far.5

  The largest gold producer in the last years of the twentieth and the first years of the twenty-first centuries was the Cripple Creek & Victor Gold Mining Company. In the mountainous area between the two towns from which it took its name, the company conducted extensive exploration, including geological studies, drilling, and construction of a model of the deposit to determine whether it could be mined efficiently, safely, and profitably. Environmental issues, no longer in the background, had to be studied and a reclamation plan prepared. The drilling disclosed that the district still contained large quantities of low-grade gold-bearing ore, previously seen as uneconomical for mining and milling. The company decided that an open-pit operation would be the most feasible, but that quickly raised red flags. Open-pit mines were not popular anywhere in Colorado.

  Because of those concerns, Cripple Creek & Victor had to work its way carefully through numerous federal and state agencies. Such issues as miners’ health and safety, the impact on the communities (Cripple Creek and Victor), air and water quality, archeological surveys, and blasting and processing procedures had to be studied and reports prepared. Finally, the company had to pay for an outside third-party review, secure its mining permits, and post a bond ($53 million on the Cresson Mine alone), payable to Colorado to ensure that reclamation would be accomplished not only on the present working site but also on older mines owned by the company. Environmental protection proposals were submitted and public meetings were held to inform—and discuss and sometimes argue. This obviously was not the way that Stratton and his friends had approached mining back in the 1890s in the district.

  Nor would Stratton, or his contemporaries, have recognized all the new ins and outs of a mining operation. Following a “thorough geologic investigation,” feasibility studies, an “extensive permitting process with local, state, and federal agencies,” and posting of a reclamation bond, actual mining could finally began. In this modern style of mining, location drilling was conducted initially to confirm gold content. Then, after blasting, the muck was surveyed and marked with flags indicating gold ore. Non-gold-bearing rock would then be backfilled in previously mined areas or moved to a storage si
te.

  At this point, old-timers would have been able to recognize the procedures, if not the magnitude of the operation. Large excavators loaded rock into 300-ton-capacity haulage trucks, which delivered the ore to the crusher to be ground into smaller pieces in preparation for the next stage. After placing the crushed rock on a leach pad, “like a large bathtub,” a “very weak, alkaline based, sodium cyanide solution is dripped on the rock.” This slowly dissolved the gold, which percolated to the bottom of the pad. Thus captured, the gold-bearing (“pregnant”) solution then drained into the recovery building to await the next process. Using a carbon-absorption process, a goldrich “mud” was heated to separate the gold and silver from any nonmetallic substances. Finally, the gold-silver mixture went to a specialized refinery for final separation.

  In 2009, the company, with 300 employees, was the only major mine operating in Colorado, as it has been throughout the first decade of the twenty-first century. Cripple Creek & Victor’s operation included more than just mining a mountain away. The company was sensitive to various problems, including historical and archaeological research, roads and transportation, and the aforementioned environmental issues. Trails for hiking and riding were built, historical exhibits and a history trail developed, and buildings refurbished in Victor. Archaeological work was conducted on threatened sites, a state highway was moved, and taxes were paid to Teller County. All of these things helped underwrite a variety of county and community projects. These efforts showed a great appreciation for mining’s history, the community and county, and the environment. Still, there was another side to the story. Several old mining campsites disappeared, including Altman, made famous in the Cripple Creek strikes. Also gone was the mountain it sat upon.

  Even if Stratton had taken all this in stride, he probably would have been stunned by another development within the industry. It took a long while, but women finally went underground in mining, as well as working above ground in the industry. Our friend Prunes made one of his pithy comments about it, “I wonder where the Tommy knawkers were hiding when WIM went underground?” Some of these women “pioneers” had organized themselves into Women In Mining and were active there, as well in as historic preservation and helping the public to understand and appreciate Colorado’s mining heritage.

  It was not easy being a pioneer. One young lady, who was the first to work in Silverton’s Sunnyside Mine, said that she remembered facing passive—and sometimes active—hostility from her male coworkers. A couple of male coworkers quit because of that long-held superstition of its being bad luck to have a woman underground. Others made remarks about women not being able to “carry their weight.” Sexual and other scribbled comments appeared here and there within the mine, and gatherings in the “dog house” for a meal could be quite tense. Finally, her fellow workers grudgingly accepted her. It took a while, but women mining engineers, geologists, and others eventually found work in Colorado mines, both above and below ground.

  By the twenty-first century, women were found in a variety of mining-related posts. For example, a report on the Cripple Creek & Victor Company pointed out that “[w]omen comprise an integral part of the mine work force, not only in the office but in the mine as equipment operators and in many technical, professional and engineering positions.” Progress over the past generation had been steady, albeit in an industry that continued declining within the state.

  Denver, however, was revived as a national and world mining center in the last decades of the twentieth century, as companies used it as headquarters for mining operations throughout the world. While this brought mining people to the city, it did not benefit state mining except in a few instances. The Colorado Mining Association continued to call Denver home, as it had for more than a century. Its annual meeting provided the opportunity for the public and mining folk to become more informed about a wide variety of developments within the industry. The Association was also the mining spokesperson at the state legislative sessions and promoted mining in various ways throughout the year, including teachers’ summer institutes and publication of the Mining Record.

  Despite the predominance of corporations in mining and in mineral exploration, Colorado still offered a place for the “small” miner. Tom Hendricks, mining at Caribou, proved this with his successful Cross Mine, just east of the old town site. Mining in environmentally active and sensitive Boulder County took patience, concern, and determination. As Hendricks pointed out, “Mining is not a get-rich-quick scheme anymore. Those days are over. But with hard, dedicated work, you can operate one mine as an ongoing business.” Hendricks conducted tours for schoolchildren and others through his operation to introduce them to modern mining and its concern for the environment. “Even though you have environmental restrictions, you can still work within them and produce,” he stated.

  Hendricks was the prototype of the environmentally concerned modern miner. Unfortunately, and tragically, Colorado also presented a terrible example of the old-fashioned, pillaging, “rape, waste, and run” extreme. In 1986, the Summitville Consolidated Mining Company started an open-pit mining operation, using a cyanide heap-leaching process to recover gold and silver from the Summitville District. This district had been mined off and on since the 1870s, with varied success; most attempts were generally not overly profitable. Located high (11,500 feet) in the eastern San Juan Mountains, with long, snowy, cold winters and potential snow slides, Summitville was a disaster waiting to happen, unless every precaution was taken to keep the cyanide solution contained in the heap-leaching pits.

  Right from the start, problems plagued the project. Pollutants from the drain system were detected in nearby streams as early as the first summer of operation. The next year, again during the summer, nine cyanide spills occurred and other reckless practices were found to be taking place in the mining operation. Sadly slow on the uptake, both state and federal regulatory agencies eventually started investigating illegal discharges into streams and other violations. Their foot-dragging, plus general bureaucratic inefficiency, tragically allowed the situation to get worse. From May 1, 1989, through June 20, 1991, mine water laced with copper, zinc, and cyanide was released, or leaked, into nearby creeks and eventually threatened the Rio Grande in the downstream San Luis Valley. Because of a bad design, snow took out part of the pit where the ore and cyanide pile percolated and allowed cyanide to escape, a fact that only exacerbated the contamination problem. The acidic leakage threatened ranching, farming, and the communities in the vicinity of the mine.

  Then, on December 4, 1992, the company and its parent (Galactic Resources Inc. of Vancouver, Canada) filed for bankruptcy protection. By that time, it faced $40 million in environmental stabilization costs. Sneaking out at midnight on December 15, the irresponsible, “not give a damn,” arrogant company walked off and abandoned the site, leaving the cyanide and other toxic material to percolate through the now-deserted operation. An estimated 150 or so million gallons of spent cyanide processing solutions remained in the heap. The EPA took over the site the next day and declared it a Superfund cleanup site. It was discovered that documents had been falsified about environment matters, among other things. The recriminations started immediately. Who was to blame? Why had this been allowed? How could it be cleaned up?

  In the end, the American taxpayer rather than the erring company paid for the cleanup, which by 1998 had cost $120 million, with another estimated $50 million more to come, before the mess was resolved. Hearings were held, fines set, plea agreements reached, and company personnel placed on probation. The company pleaded guilty to forty felony counts, the majority related to the discharge of unauthorized pollutants. According to Ken Fimberg, the assistant U.S. attorney involved in the case, the result “sets a tone that significant crimes were committed at the mine.” As the Denver Post (June 16, 1995) correctly pointed out, “Summitville came to symbolize what environmentalists saw as everything wrong with the mining industry and the laws that govern it. It became a rallying point for ef
forts to reform mining laws.” The fallout resulted in Colorado’s mine-permitting laws being changed and strengthened, but yet again federal mining reform efforts failed.6

  The EPA received a share of the blame as well. As a Denver Post editorial (February 3, 1996) bluntly stated, “there’s a worrisome lack of understanding in Washington about the need for strong, but efficient, environmental protection.” In the same editorial, the state received its share of blame for not monitoring the gold operations, because it “didn’t have the staff, money or political will to deal with the emergency.” Although the Colorado mining industry in general was not involved in this awful episode, in the public’s mind it stood in the dock, guilty as charged. It would take years to overcome the Summitville black eye; meanwhile, opponents of mining had gained a wonderful weapon with which to club the industry.

  Cyanide continued to be in the public eye because of problems elsewhere in the United States. In other places in the world with less environmental concern and regulation, the problem often was worse. An attempt to ban the use of cyanide to extract gold died in a Colorado senate committee in January 2003. Both sides marshaled the familiar arguments, and, of course, Summitville was dragged into the debate. One side saw problems to come “once mines closed”; the other “felt the problem did not exist.” The debate drags on, awaiting another day or another accident.

  Colorado mining did much better in other environmental arenas. A pollution problem (both drainage and blowing dust) existed on Red Mountain, which led to Superfund litigation. It took nine years to resolve this issue; parties included the state, San Juan and San Miguel Counties, and the Newmont Gold Company that owned the Idarado mine. In complete contrast to what had happened at Summitville, and after a bit of wrangling, an agreement was reached and reclamation was started. It included stabilization of tailings piles, revegetation, remediation of mine portals, and, interestingly, a blood lead screening program at Telluride for local children under the age of 72 months.