What is the true value of gold?

What is the true value of gold?

There’s something about gold. It possesses us, sometimes entire nations to accumulate more and more of it. Humans have had a strong affinity for gold since the times of the ancient Egyptians and the Aztecs. Gold has been used as currency for thousands of years. Wars have been fought for it, entire civilizations slaughtered for their gold.  Pindar, the ancient Greek poet, described gold as “a child of Zeus, neither moth or rust devoureth it, but the mind of man is devoured by this supreme possession.”

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It’s hard to describe the feeling of finding your first gold nugget in an old stream bed.  It sits there in your pan shimmering, the way that only gold can.  You immediately recognize it’s power, it is intoxicating.  This is what drives prospectors past and present to take great risks in the search for gold.  There’s more than just the value of gold that attracts us to it.  The word “placer” itself comes from the Spanish word meaning “pleasure”. For some it is an addiction, for others it symbolizes wealth. You’ll be hard pressed to find a member of the human species who wouldn’t be interested in some gold.

Gold has several properties that make it desirable.  Most importantly it does not rust or tarnish.  Gold artwork discovered in the tombs of Egypt looks just as lustrous today as it did 5000 years ago.  Why is that?  Gold belongs to a group of metals called the “Noble Metals”.  They’re called noble because like nobility in old time monarchies they don’t associate with others.  It’s fancy way of saying that the metals don’t readily react.  Conversely iron will readily react with oxygen to form iron oxide (aka rust).  Gold and other noble metals, such as platinum, possess a very strong atomic structure that requires a lot of energy to disrupt.

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The ability to maintain over time is common of all valuable substances.  A diamond for example produces a characteristic glow when cut and faceted properly but what good would it be if it disintegrated a month later?  Diamonds are extremely hard and have a rock solid crystal structure.  Other valuable gemstones all share similar properties, emeralds, rubies, sapphires and garnets all sit at the high end of the hardness scale.  While gold isn’t hard in a geological sense it maintains it’s shape and luster indefinitely.

Gold is also very malleable.  Meaning that it can be hammered or pressed into various shapes without cracking or losing its consistency.  You could stretch an ounce of gold into a wire 80km long or produce a sheet of gold leaf 80 meters by 80 meters wide.  Gold is also an excellent conductor.  Not quite as good as copper but a better conductor than nickel, brass, iron, tin, and aluminium.  Gold conductive wire is used in many critical electronics applications such as computer motherboards, smart phones and satellites.

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Carajás iron mine, Brazil

What really makes gold valuable though is it’s scarcity at the earth’s surface.  Approximately 165,000 metric tons of gold have been produced in the entirety of human history.  While that may sound like a lot the amount of gold produced by mining is extremely small in comparison to other metals.  For example the Carajás Mine in Brazil produces an average of 300 million metric tons of iron per year and has a deposit estimated at 7.2 billion metric tons.  And that’s just one mine.  All the gold ever produced would fit inside one Olympic sized swimming pool.

It is often stated that you can’t eat gold.  While that’s not entirely true, (see gold covered pizza) an all gold diet wouldn’t provide much nutrition, and you’d probably have some digestive issues.  The yellow metal doesn’t appeal to our basic needs for survival but neither does money or a smartphone.  That doesn’t make any of these things less valuable.

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We typically think of value in dollar terms.  When evaluating an investment such as stocks or real estate it’s hard to think of anything else.  Dollars are not constant though, they are subject to manipulation and inflation.  For at least 6000 years gold has been used as currency and unlike modern currency is not subject to inflation.  Modern currencies are what is called “Fiat Currency”.  There is no standard on what a modern currency note can be exchanged for.  Their value relies solely on people’s faith in it.  Or more correctly their faith in the government.  Inflation rates can severely affect the spending power of a dollar.  There are countless examples, the most striking is the inflation of the German Reichsmark which rose from 4.2 marks to USD in 1914 to a peak of around 4.2 trillion marks to the US dollar by November 1923.  At that time a wheelbarrow full of German marks wouldn’t even buy a newspaper.

Historically world currencies were backed by the gold standard which meant that by law any amount of paper money could be exchanged for a specified amount of gold.  In the 1920s each US dollar was backed by 1.5 grams of gold.  The dropping of the gold standard in Germany during WWI allowed for the hyperinflation that followed.  The United States dropped the standard during the great depression to avoid the federal gold supply from being completely depleted.  Canada followed suit in 1933.  There’s much debate on the merits of dropping the gold standard.  What resulted though is the ability for the government to completely control the currency without requiring tangible assets (ie. gold) to back it up.

Gold bars
Gold bars

So if the dollar is backed by nothing and can be manipulated at will how do you gauge the value of gold.  Or anything for that matter.  True value depends on what people are willing to trade for your goods.  Money makes it easy to barter and trade goods since it’s ubiquitous and there is an agreed upon value at any given time.  For example if you want to sell your car on craigslist you’ll have an idea of how many dollars you want for it.  Lets say you have a used Honda Civic.  You could sell that easily for $4000 CAD.  That same Honda Civic could be traded for a 1 carat diamond engagement ring.  50 years from now a used car might sell for $25,000 dollars due to inflation but the exchange rate of car to diamond ring would remain the same.

The old adage that an ounce of gold will buy you a nice suit still rings true today.  In the gold rush era (1848-1900) an ounce of gold would trade for about $20 USD, and would also buy a nice suit.  A typical suit today would cost you about $450 USD.  So it would seem that today’s gold would buy you 3.5 nice suits.  You have to consider that in the 1800s nice clothing was not mass produced.  To compare accurately you’d have to look at a tailored suit.  A mid range tailored suit made in the United States costs between $1650 and $1800 today.   At present gold is trading at about $1250 USD so the suit adage falls just above the quoted dollar value of gold.

Indian River Yukon

What really gives gold it’s value is the cost of exploration and production.  Being very rare it takes a lot of effort to find gold.  Once it’s found it is expensive to produce as well.   For example Barrick’s Cortez mine in Nevada has an average grade of 2.11 grams per ton.  That means that for every ton of ore processed they average 2.11 grams of gold.  Barrick’s published production cost at the Cortez mine is about $900/oz.  It really is remarkable that they can move and process the 15 tons of rock required to obtain an ounce of gold for $900.

The cost of producing an ounce of gold varies for each mine.  In a placer operation it is a constant cat and mouse game to keep costs low enough to make production economical.  When gold commodity prices fall below production costs mines shut down and less and less gold is produced.  The production cost, driven by scarcity is the single most important factor that drives the price of gold.

RC Drill in Action

Gold exploration is also very expensive.  In the times of the North American gold rush placer and hard rock gold was discovered all over the Western part of the continent.  From the 1840s to 1900 new gold districts were popping up every year as discoveries were made.  Trending almost in sequence Northward from California to the Yukon as explorers made their way through the wilderness.  In more modern times most of the easily reachable areas have have been at least partially explored.  Exploration today mostly takes place in more and more remote areas, such as the Canadian Arctic or other places with a small human footprint.

To properly explore a claim in these areas requires a camp. helicopters and all kinds of equipment.  A typical small exploration program in the Northwest Territories can cost well over $1,000,000 per season with slim chances of success.  While advancements in exploration technology such as geophysics and aerial imagery can provide information that wasn’t available to previous explorers there is no silver bullet.

The costs of thousands of exploration ventures that didn’t amount to a mine are factored into the price of gold as well.  For the estimated 100,000 explorers that took part in the Yukon gold rush only a select few managed to recoup their costs.  Some made made great discoveries but many more spent their life savings on an adventure but returned with no gold.

Big Al Jig

Gold’s value is based on it’s unique properties, people’s desire for the very special metal and the work required to find and produce it.  The value has nothing to do with the the dollar value attached to it.  For every ounce of gold produced tons of rock had to be excavated, the deposit had to be discovered and mapped, and the ore milled and smelted to extract the gold.  As you gaze upon your gold ring and admire it’s beauty think about the story that it could tell you.

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Placer Exploration in the Yukon

Placer Exploration in the Yukon

In the spring 2016 I was hired to help on a large scale placer exploration program in the Yukon. The property is located in a part of the Yukon where very little placer activity has taken place. We had a small team of three guys and a lot of equipment.

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The Yukon, like BC and Alaska, was explored and settled by prospectors in the late 1800s.  The Klondike gold rush of 1896-1899 was the largest and most storied gold rush in history.  It is estimated that over 100,000 gold seekers migrated to the Arctic territory from places like San Fransico and Seattle.  The Yukon’s economy is still driven by mining and the local culture is completely saturated with gold rush era influences.  A great example is Yukon Gold, the flagship beer of the Yukon Brewing Company, has part the the famous poem “The Cremation of Sam Mcgee” on the label.

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The Robert Service poem is part of Canadian heritage and is part of the school curriculum across the country.  After several trips prospecting in the Yukon it takes on different meaning than a quirky poem that you have to read out loud in grade three.

There are strange things done in the midnight sun
By the men who moil for gold;
The Arctic trails have their secret tales
That would make your blood run cold;
The Northern Lights have seen queer sights,
But the queerest they ever did see
Was that night on the marge of Lake Lebarge
I cremated Sam McGee.

On a Monday night in early April at 9PM I received a phone call. “Your flight leaves Vancouver in the morning for Whitehorse. We’ll fill you in on the way.” Typical for this kind of job. I had been expecting the call for a few weeks but it still caught me a little off guard.

Approximate location of the camp
Approximate location of the camp

On arrival to Whitehorse I had been advised that one of our crew would meet me there. I had never met this guy before but I knew he was an old placer miner. The Whitehorse airport is small and we were the only flight. There were several people waiting for passengers so I had to guess. I noticed a guy wearing rubber boots and looked like a placer miner to me. I introduced myself and luckily he was the right guy.

Aerial shot of the placer claims
Aerial shot of the placer claims

We spent a couple hours rounding up additional gear before catching the charter to the camp. I was crammed in a Cessna 206 with the pilot and a bunch of gear. We had all the 5 gallon pails we could buy at the Whitehorse Home Hardware, drill bits, my gear, a 45 gallon drum of diesel, and a bunch of other stuff.

Soon after leaving Whitehorse we flew over Lake Lebarge which is the location where Sam Magee was famously cremated.

LakeLabarge
Lake Lebarge

The pilot warned me that the runway was a little rough. We took a couple passes and lined up to land. It was rough all right, made of gravel and ice, we bounced so hard that we almost took off again. My two crew members were waiting to greet me at the plane. They were excited to meet me, especially since I brought a 24 pack of Kokanee. The beer didn’t last the night.

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The two guys that I was working with had already been there for several weeks. It’s a rustic camp and there was no water available for showers or anything. I thought my team mates smelled pretty bad when I arrived but after a few days we all smelled the same. A few weeks later temperatures were high enough to rig up a pump system and a shower. This is not the first rustic camp that I’ve been to where we have satellite internet and no showers.  These are interesting times to be an explorer.
TheCamp

The camp consists of three canvas tents, a seacan and an outhouse.  The tents have “hippy killer” stoves that burn wood.  They work well most of the time but you have to chop wood every time you want heat.  Wood floors had been constructed which is certainly a luxury over dirt floors.  Our kitchen is in the same tent as the office.  There’s a propane stove/oven and plenty of food.  We used paper plates so we wouldn’t have to wash them, they worked great for starting the stoves when we were done with them.

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The main goal of this program was to carry out a sampling over the property.  The drilling and sampling will allow us to find and evaluate economic placer deposits. Our primary tool was a Nodwell mounted drill with a 12″ auger. Some areas were sampled by excavator where the ground was not suitable to drill. Material was collected with the drill and excavator and processed on site with a small wash plant. In addition to gold values we developed an understanding of bedrock depth, characteristics and the distribution of placer gold.

Our Auger Drill
Our Auger Drill

Most of the gear was brought in on the winter trail. The trail is about 100km from the closest dirt road and requires the ground to be frozen and snow covered. Our two Nodwells, Toyota track truck, quads, fuel and everything was brought in over the trail. With a light load it can be travelled by snowmobile in about 4 hours each way. With the heavy equipment it takes 3-4 days. There are impromptu camps along the way but nothing with heat and very little shelter. The guys were prepared of course.

On the trail
On the trail

Nodwells are pretty cool machines.  They were invented in the 1950s to service the oilfields of Northern Alberta and the Arctic.  These beastly machines have super wide tracks to spread their weight on soft terrain.  They have a unique drive system that uses rubber tires on the track.  Operating one is similar to driving a tank.  You pull levers to brake the track on either side.  We had two of them, a big Nodwell for the drill and a smaller one for a support vehicle.  The Nodwells have a lot of character, check out the yellow plywood interior and gun rack.  The small one is named “Picasso”.  The photos will expand when clicked.

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We located and mapped several trenches that were used for ground sluicing dating back to the 1898 Yukon gold rush. The old timers diverted the creek to flow through hand cut trenches. The water was then controlled via a series of gates to strip away overburden. Sort of like hydraulicking. There’s not much left of the old workings today but it gives us an idea of where the pay streaks are.
Old Timer's Trenches
Old Timer’s Trenches

Sampling is key to any placer operation.  Sloppy or inadequate sampling spells the death of many mining operations.  After all you wouldn’t get married without going on a date first.  We collected samples with a rugged 12″ auger drill.  Each sample had a set depth interval and a measured volume.  With accurate measurements we can extrapolate the sample data to evaluate the deposit over large areas.  For example if we sample 500mg (1/2 gram) from 10 pails of material,  that equates to just over 3 grams per cubic yard.  We did have some just like that, and better.

Fresh Drill Samples
Fresh Drill Samples

After collection by the drill our samples were run through a mini wash plant.  We were using a cool machine called “The Prospector” by Goldfield Engineering.  The Prospector uses a water driven pelton wheel to create a vibration.  That’s awesome because all it needs is a 2″ pump to run.  The wheel rotates an eccentric weight similar to the way the a cell phone vibrates but on a larger scale.  Using this machine I processed over 15 cubic yards of samples over 7 weeks.

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The Prospector really eats through material.  The shaker screen breaks it up almost as fast as you can feed it. It struggles when there is a lot of clay though.  After each sample interval is run a cleanup is necessary.  With this machine it’s a quick procedure.  The concentrates from each sample are panned out with a gold pan.  The gold is then dried out and weighed to be used in grade estimates.

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As the summer solstice approaches the days get longer in the Yukon.  In the summer the sun does not set in the Arctic it is after all the land of the midnight sun.  The lack of darkness takes a little getting used to.  In early May we had a couple of Northern lights shows that were pretty good.  At that time there was about 2 hours of darkness where the Northern lights were visible.  A week later it would no longer be dark enough.

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OLYMPUS DIGITAL CAMERA

We encountered few animals on the trip.  This is described as a “hungry” part of the Yukon.  One bear tried to enter our camp.  It was a very large black bear, the electric fence slowed him down but it took a few bear bangers to scare him off.  A huge mangey wolf casually pranced right in front of us one night.  All the animals are big in the Yukon.  Even the mosquitoes.  They are so big that they often get up and fly away after you swat them.  Unless you are willing to really smack yourself in the face, they are not going to die.

Mosquito

For some samples we had to use the excavator.  The auger drill does not work well in areas where the permafrost has melted.  We tried a few spots and the mixture of water and loose gravel would not stay on the auger flights.  The excavator does not have that problem since it scoops up a bucket full of material, water and all.  We used a huge 4″ pump to drain the holes first then sampled the bedrock and regolith with the hoe.  The samples were of course put into pails and we measured the volume before processing.

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We had a few other machines to help out as well.  A couple of bulldozers, some quads, a side by side and a ’96 Toyota pickup with tracks instead of wheels.  We took the tracks off once the snow was all gone using the hoe to lift the truck.  Why bother with jacks when you have those Tonka toys kicking around.

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The winter trail conditions rapidly deteriorated as the weather warmed up.  The ground here is like muskeg with lots of water and mud.  Just about everything got stuck at some point, except for the Nodwells.  We had to cross a few creeks, mud and sometimes straight trough the trees.

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DrillTowDozer

The pursuit of gold will make men do strange things.  In our case it involved a ton of work travelling over unforgiving terrain to drill holes down to bedrock.  Our persistence and determination paid off though and we discovered a pay channel that extends over much of the drilled area.  It is going to take some more work to map out the full extent but we already have clear evidence of a great deposit.

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After 50 straight days it was time to go home.  Our ride out was a DHC-3 Turbo-Otter, an impressive aircraft designed by de Havilland, a Canadaian company, in the 1950s.  The Otter took our whole crew and all our gear without any issues.  The turbine engine gives it the STOL capabilities to takeoff and land in a rugged bush airstrip like the one in this camp.  We stopped along the way to drop off one of our guys and pick up some much needed beer before landing in Whitehorse.

I had a wild night in Whitehorse to close off the trip before heading home to BC.  It was a good time in the bush but it is nice to return to the comforts of modern civilization.

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Introducing WCP Placer Mining Club

Introducing WCP Placer Mining Club

Hey guys, I am pleased to announce that West Coast Placer is starting a mining club.  There have been a number of inquiries from people who want to prospect and mine on WCP claims.  So we’re starting a club that will provide the opportunity for members to use our claims.

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Club members will have access to all of West Coast Placer’s claims.  Currently that includes 12 placer claims and two mineral claims in BC.  Access to some of my partner’s claims is also available.  We have claims all over BC including the Tulameen, Similkameen, Fraser River, Cariboo and Kootenays.
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Members will be able to work the claims as if they own them.  You can run a sluice, pans or whatever you want.  Of course members can keep all the gold that they find.
You will be able to camp on the claims in tents or with an RV (where accessible).  Family members are automatically included in your membership.  Gold panning is a great activity for the whole family, kids love it.  You can bring your friends too, the more the merrier.
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There are a few obligations that will have to be met.

  • The first rule of prospecting club is you do not talk about prospecting club.  Just kidding I had to throw that in there.
  • Members must follow all the regulations regarding placer mining in BC.  If you don’t know all the regs don’t worry, information will be provided.
  • Activities will have to be recorded.  This will help with our reports to the MTO.  It’s not much work, just keep some notes on the work that you do.  Keep track of things like, hours spent working, size and location of holes, and take pictures.  This information will also be shared with the group.
  • If you plan on running a sluice or highbanker you will need to have a Free Miner’s Certificate.  If you need help getting one, just ask.

There will be an annual fee of $50.  Why a fee?  That is required to limit club membership to people who are truly interested.  $50 is pretty much free compared to similar clubs.  The others are looking for $300 and up.  We’re not interested in making money off of memberships.

As a member you will also have the opportunity for instruction in the art of gold prospecting.  This is great for novice miners.  You can join myself and more experienced members on prospecting trips.  That is the best way to learn, you can watch youtube videos and read books all day but nothing beats hands on training.

The Map Lies

Members will have support from experienced miners.  You can even get help with your own MTO reports for your own personal claims.  You can ask advice at any time and we’ll try our best to get back to you as soon as possible.

As a member you will be entitled to a discount on the purchase any of West Coast Placer’s claims.  There will be more perks as the club grows.

If you are interested please send an email through the WCP contact form on this link, Contact Form.  Please share any suggestions or comments that you might have.

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Mining the Ocean Floor with Robots

Mining the Ocean Floor with Robots

Mining under Earth’s oceans is just starting to happen.  We have gotten pretty good at mining deposits that are accessible by land but 71% of the Earth’s surface is covered by water.  To date no large scale mining operation has succeed under the ocean which means that it’s all virgin ground.

Amazingly the human race has spent more time and money exploring outer space than we have under our own oceans.  Over 500 people have been to space while only three have ventured to the deepest part of the ocean, the Mariana Trench.  We have better maps of the surface of Mars than the bottom of the ocean, although the ocean maps are pretty cool.

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The same geological processes that happen on land also take place under the ocean.  There are volcanoes, mountain chains, faults and earthquakes.  All the same types of mineral deposits occur under the ocean such as epithermal gold, porphyry, and placer.  There are also diamond pipes, massive sulphides and everything else that we mine at the surface.

Deposits

The ocean also has types of deposits that we can’t find on land.  One special mineral deposit is called Polymetallic Nodules.  These are concretions of metallic minerals that occur under the ocean.  The nodules grow sort of like stalactites do in a cave, over time layers of metallic minerals precipitate out of seawater and add to the nodule.  The growth of nodules is one of the slowest known geological processes taking place at a rate of one centimetre over several million years.

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Polymetallic nodules are roughly the size and shape of a potato and contain primarily manganese as well as nickel, copper, cobalt and iron.  They can be found on the sea floor or buried in the sediment.  Nodules can technically occur anywhere in the ocean but seem to be in greatest abundance on the abyssal planes around 5000m deep.  Nodule mining would be similar to placer gold mining except under water.

Anouther resource that is unique to the ocean floor is Ferromanganese Crusts.  These are similar to nodules but occur as a coating on other rocks.  These crusts can be found all over the ocean with thicknesses ranging from 1mm to 26cm.  Ferromanganese crusts typically occur in the vicinity of underwater volcanoes called seamounts or near hydrothermal vents.  Crusts with mineral grades that are of economic interest are commonly found at depths between 800m and 2500m.

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Ferromanganese Crust

Ferromanganese crusts are composed primarily of iron and manganese, hence the name.  Typical concentrations are about 18% iron and 21% manganese.  Cobalt, Nickel and Copper occur in significant quantities as well.  Rare earth metals such as Tellurium and Yttrium can be found in metallic crusts at much higher concentrations than can be found on the surface.  Tellurium is used in solar panels and is quite valuable.

Sea-floor massive sulphides (SMS) are a younger version of volcanic massive sulphides (VMS).  The two deposits are similar except that VMS are typically ancient and SMS are currently forming.  SMS deposits occur where superheated hydrothermal fluids are expelled into the ocean.  They typically form around black smokers near continental rift zones.  SMS are know to hold economic concentrations of Gold, Copper, Silver, Lead, Nickel and Zinc.

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BlackSmoker

Black smokers create SMS deposits by expelling superheated sea water that is rich in metallic elements.  Cold sea water is forced through the sea floor by the pressure created from the weight of the water column above it.  The water is then heated to temperatures in excess of 600°C when it is brought close to the magma that lies below.  The heated water becomes acitic and carries with it a high concentration of metals pulled from the surrounding rocks.  Once the hot, metal rich, water comes into contact with cold sea water the metals crystallize and deposit on and around the black smoker.

Mining

Large scale ocean floor mining has not taken off yet.  Attempts have been made since the 1960s and 70s  but failed due to technological and financial challenges.  Small scale shallow ocean mining has been a lot more succesful in recent years.  A great example is the popular TV show Bering Sea Gold.  The miners in Nome Alaska are using modified suction dredges to comb the sea floor in shallow waters.

Currently proposed sea floor mining ideas are essentially super high-tech placer mining.  They involve ways to dig through the surface layers of the ocean floor, bring the material to the surface and ship it to a processing facility.  Its a lot like dredging but on a massive scale.  As mentioned above, normal hard rock deposits also occur under the ocean but no plans have been proposed to build open pit mines under the ocean.  That would involve all the challenges of building a mine on land with the added complexity of operating under the ocean.

Why is ocean floor mining possible now when it wasn’t 20 years ago?  The answer comes down to one word, robots.  The world of under water mining is the domain of autonomous drones and human controlled ROVs.  Robot submarines are nothing new, they have been around since the 70s and have been used to explore depths of the ocean that are very difficult for humans to get to.  UUVs or unmanned underwater vehicles are a little bit newer, they are basically an autonomous version of ROVs.  Ocean mining robots have just been invented and share a lot of the technology used in these devices and they look like something straight out of science fiction.

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The Cutter

The first deep sea mining project is currently being developed off the coast of Papua New Guinea.  The project is called Solwara 1 and is being developed by a Vancouver BC mining company called Nautilus Minerals.  Solwara 1 is a copper/gold SMS deposit with estimated copper grades of 7% and gold grades in excess of 20g/t and an average gold grade of 6g/t.  The property sits at about 1600m depth.

Nautilus has developed a suite of underwater mining robots and a complete system to mine the precious metal and bring it to shore.  There will be the bulk cutter pictured above, an auxiliary and a collection machine.  Please take a moment and marvel at these amazing achievements of engineering.

Transporter Bridge TeessideTransporter Bridge Teesside
 After the robots dig up and collect the ore a custom designed Riser and Lift System (RLS) will bring the material to a giant ship that acts as the mine control center dubbed the Production Support Vessel (PSV).  The RLS is basically the world’s most powerful suction dredge.  It’s pretty complex, this is the description on the Nautilus Minerals website:

The Riser and Lifting System (RALS) is designed to lift the mineralised material to the Production Support Vessel (PSV) using a Subsea Slurry Lift Pump (SSLP) and a vertical riser system. The seawater/rock is delivered into the SSLP at the base of the riser, where it is pumped to the surface via a gravity tensioned riser suspended from the PSV.

Once aboard the Production Support Vessel the mined slurry will be dewatered and stored until anouther ship comes to take the material on shore for processing.  The removed sea water is pumped back down the RALS which adds hydraulic power to the system.  Pretty cool stuff!  Check out the video below for an visual explanation of how it will all work.

Exploration

Ocean floor prospecting is not a good place to be gold panning or hiking around with a rock hammer.  It is also difficult to take usable photos due to poor light and lots of debris in the water.  So how do you explore for minerals in the ocean?  Geophysics and robots.

Geophysical exploration is not unique to the ocean.  The same techniques are used routinely on land to find every type of mineral deposit.  Ocean geophysics is also not new.  The main workhorse of mining exploration is magnetometry.  Which means mapping changes in earth’s magnetic field using a specialized sensor.  The technique was actually developed to detect enemy submarines during World War II.  Since then magnetometers and the science behind them have evolved into accurate tools to measure geology.

I’m using a proton precession magnetometer in the photo below.  There is some sample magnetometer data on the left.  Mag maps look similar to a thermal image except the colour scale represents magnetic field changes (measured in nanoTesla) instead of temperature.

Walk Mag in ActionSampleMag

Magnetometers are excellent tools for ocean mining exploration.  They are not affected by the water and are excellent at detecting metallic anomalies.  There are now underwater drones that can collect ocean magnetometer surveys without the need for human intervention.

Autonomous Magnetometer Drone
Autonomous Magnetometer Drone

Other geophysical techniques have been used in ocean mineral exploration.  Electomagnetics (EM) techniques are also great tools for exploration under water.  EM works in a similar way to magnetometry except that they emit their own source.  Conventional metal detectors are actually a small version of an EM system.  While mag passively measures Earth’s magnetic field EM measures the difference between a source and received pulse.  EM also works great for discovering metallic anomalies and is being incorporated into autonomous drones as well.

There are other types of ocean geophysics such as seismic refraction which uses a giant air gun to send a sound wave deep into the crust and measures the response on floating hydrophones.  Sonar and other forms of bathymetry can provide detailed maps of the ocean floor.  Bathymetry techniques can create imagery similar to LiDAR that is used on land.

Sample Bathymetry
Sample Bathymetry

Ocean mining is just in its infancy and some really cool technology is being used.  Advancements in the robotics have allowed mining and exploration to be completed without a person having into enter the water.  As technology advances further we will be able to explore vast areas of the ocean floor and discover immense mineral reserves that are presently unknown.  It is estimated that we have only explored about 5% of the ocean floor, who knows what we’ll find down there?

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How Much Gold is Left on Earth?

How Much Gold is Left on Earth?

Is the world running out of gold?  That seems to be a common theme in investment circles in recent years.  This eye catching article on Visual Capitalist estimates that we’ll be out of gold by 2030. This article based on a report from Goldman Sachs claims we’d hit “peak gold” in 2015, GoldCore.
Gold_reservePeak gold is the same idea as peak oil.  Where the peak is the moment when maximum world production is reached and declines from then on, eventually reaching zero production.  Unlike oil though gold is not used up in consumption.  It is typically stashed away in a vault or worn as jewellery.

Estimates for all the gold in the world mined to date hover around 165,000 metric tons.  Some estimates go as high as 1 million tons but most experts would agree that under 200,000 is accurate.  World gold supplies are difficult to quantify. That is because gold reserves are not always reported accurately.  Over 50% of gold above ground is used for jewellery which makes it difficult to track.  Gold rings, necklaces and such can change hands without any records.  About 35% is stored as bullion for investments and reserves.  Large holders of gold give misleading numbers regarding their reserves, presumably for security reasons but who knows?

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The United States, Germany, Italy and France are the worlds largest holders of gold respectively.  Each has their share of controversy surrounding their claimed gold deposits.  There are conspiracy theories about the amount of gold stored in Fort Knox.  Some believe it is empty and the government is just pretending its full of gold.  Without seeing it for ourselves we’ll just have to accept the disclosed numbers.

To further add uncertainty to global gold production small scale miners do not typically report their take.  This is especially true in third world countries.  A lot of gold is mined in this way, primarily placer but hard rock as well.

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How much gold is left in the ground?  Nobody really knows.  Mining companies of all sizes spend their exploration budget to map out potential deposits.  They are a long ways from mapping the entire earth.  The peak gold estimates are based on proven and indicated reserves that are reported by public mining companies.

There is no shortage of gold on earth.  The problem is that it is much deeper than we can mine.   Current scientific theories estimate that there is enough gold in the core to cover the surface of the earth with a 4 meter thick layer of pure gold.  The density of the core is measured using several techniques including seismic geophysics.  Seismic waves are measured from earthquakes all over the world.  The wave properties change as they pass through the liquid outer core and the super dense inner core.  S-waves can’t travel through liquid, that is how the outer core is mapped.  The density of the inner core is greater than iron at 5,515 kg/m3.  Clearly there are large amounts of substances that are heavier than iron to achieve that density.

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We are limited to several thousand meters below the surface as far as mining is concerned.  Check out this blog post on the origins of gold.

Lets do a little math.  The average concentration of gold in Earth’s crust is estimated to be between 0.0011 ppm(source) and 0.0031 ppm(source).  Now we can calculate the volume of the portion of the crust which can potentially be mined.  The deepest gold mine in the World is TauTona Mine in South Africa which reaches 3.9 kilometers below ground.  The TauTona mine, operated by AngloGold Ashanti, is a gold mine so its a good yard stick for how deep we can go.

The volume of the earth (approximated as a sphere) is 1,086,832,411,937 cubic kilometres.  The calculated volume for the earth with 4km stripped off the top is 1,084,788,886,213 km3.  Subtracting the two and using the average abundance of 0.0031 ppm we arrive at 6.3 billion cubic meters of gold in the top 4km of the crust.  One more calculation, gold has a known density of 19.3 tons per m3.  Which gives us a total mass of 122,264,143,828 or 122 billion metric tons.  That is a lot of gold.

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Our calculated estimate of 122 billion metric tons of theoretical gold includes the entire surface of the earth.  Currently we are not equipped to mine the oceans, although technology is advancing quickly.  Check out this article on sub-sea mining robots, LINK.  The same processes that accumulate gold into deposits occur in the ocean just as they do on land.  With 71% of the surface covered by ocean that is a significant area that is yet to be explored.
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Lets adjust our estimate to account for only continental land which can be mined with today’s technology.  So by subtracting the oceans we are left with 35 billion tons of gold on dry land.

Global production throughout the entirety of human history is 165,000 metric tons as previously mentioned.  So in a very theoretical sense we have mined 0.00047% of the world’s surface gold.  That’s very encouraging.  Although not all of that gold is accumulated in mineable deposits.  Typically you need at least 0.5 ppm to make a mine profitable.  Depending on logistics, location, overburden and other factors that cut off grade can rise quite steeply.  So all of that 35 billion tons is not really available to us.

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Once gold is discovered it will be mined.  We are too greedy to leave it in the ground.  Take a look at the gold rushes of North America between 1849-1900.  There are some great blog posts on the subject here, Gold Rushes.  The hoard of gold hungry prospectors would descend on a creek once a discovery was made.  They would move in, erect a town and mine it for all its worth.  Within 2-3 years all the easy gold is gone and only the tenacious miners would remain to mine the small gold.  The rush would continue elsewhere and repeat the cycle.  The same thing happens with hard rock mining but on a longer time scale.

Peak gold takes this phenomena into account.  Much like peak oil we’ve picked the low hanging fruit wherever it has been found.  Gold is a little different because it is very hard to find.  When it comes to oil reserves the big ones stick out like a sore thumb.

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Typically it takes about 20 years to go from discovery to full scale gold mine.  That involves all the steps to test a property using prospecting, geophysics, and diamond drilling.  Delineating the reserve and all the stuff that it takes to build a modern mine (permits, studies, infrastructure and so on).

With the current state of the mineral exploration that 20 year lead time is going to come back to bite us.  Over the last few years mineral exploration has dropped off to the point that it is almost non-existent.  That seems counter-intuitive if we are running out of gold.  Exploration is a high risk investment and people don’t take the risk unless commodity prices are high.  The good news is that when prices spike again like they did in 2010 there will be a massive feeding frenzy.

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So we’ve estimated that within 4000m of the surface of Earth’s crust there is 35 billion tons of gold.  With a remaining 87 billion under the ocean.  Only a small portion of that is concentrated enough to mine.  Its a big world out there and we’ve only properly explored small pockets of it.  The super easy stuff is largely gone but with advancements in technology and some ingenuity its there for the taking.  For those explorers who are willing to put on their thinking cap and step outside of their comfort zone there is a bonanza waiting for us.

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The Search for Klondike Lode Gold

The Search for Klondike Lode Gold

In the summer of 2010 I was hired to work with a team to find hard rock gold in the Klondike.  We explored a group of claims on the Indian River.

IMG_1741My crew stayed at a camp operated by a character called Big Al.  That name might sound familiar because he has been featured on the popular TV show Yukon Gold on the History Channel.  Of course at that time we had no idea he was going to be a celebrity.  During the trip we heard a rumour that Hoffmans working a few claims over were filming for a TV show, it turned out to be the hit series Gold Rush on Discovery.  We were surrounded by gold mining TV stars but didn’t know it yet.

Klondike Tailings Piles
Klondike Tailings Piles

Indian River Yukon

The Klondike is a place that has a very storied history and was the site of the greatest gold rush of them all.  California, Oregon, and British Columbia had their gold rushes and stories but the Klondike was like no other.  Between 1896 and 1899 over 100,000 adventurers made the journey from all over the world to the largely uninhabited Yukon territory in search of gold.  What made this rush different is the long journeys and overall inexperience of the Argonauts.  At the time of discovery El Dorado and Bonanza creek were the richest creeks in the world.  Some claims on El Dorado were getting $27 to the pan once they hit the pay streak.  That is equivalent to about $750 per pan in today’s money.

My team met up in Whitehorse the capitol city of the Yukon Territory in early August 2010.  We then rounded up some remaining gear and drove in a rented truck up to Dawson City.  As you arive in Dawson City you can see the remains of over 100 years of placer gold mining. Before you reach the town you can see large tailings piles lining the sides of the highway.  When looked at from above they look like something that was produced by a giant insect.  The tailings piles were put there by humongous dredges that scoured the Klondike drainages until 1966.  It is estimated that each of the dredges were producing as much as 800 ounces of gold per day!

Aerial View of Kondike Tailings
Aerial View of Klondike Tailings

Dawson City is a cool town.  The residents have maintained the look and feel of Dawson’s heyday during the Klondike gold rush.  The streets are dirt with wood plank sidewalks.  Most of the buildings are original in the downtown area and many commercial buildings have the false front that was the norm during the gold rush era.  There is even a law that all signs have to be hand painted.

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There are no corporate stores or businesses in Dawson.  Everything is locally owned and operated.  Some of the original establishments from the 1890s are still in operation today.  Diamond Tooth Gerties is one such establishment which offers games of chance and nightly can can dancers 7 days a week.  Anouther is Bombay Peggy’s which operated as a brothel during the gold rush.  It has turned into a classy bed and breakfast now.

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My Crew posing with the Can-Can girls

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Dawson has several historic bars as well.  One such bar is the Downtown Hotel.  We stopped in there one night after visiting several other bars and took part in a local tradition.  It is called the Sourtoe Cocktail.  Only one of my crew was willing to take the shot with me.  The Sourtoe Cocktail is a shot of Yukon Jack whiskey taken with an amputated human toe in the glass.  They keep the toe in a jar of salt above the bar.  Apparently the tradition started with a bootlegger losing his toe due to frostbite.  I was informed that this was their 6th toe which makes you wonder where they new ones came from.

Bombay Peggy'sThe Toe

The Bonanza Creek Road is the main access to Indian Creek.  Along this historic route there are plenty of relics of past mining adventures.  Most notably the historic Dredge No. 4 which mined Bonanza Creek until 1959.  There are other dredges as well and plenty of old heavy equipment that was abandoned by miners of the past.  There are abandoned bulldozers, excavators, trucks and other random big machines.  There is such a surplus of iron that many bridges use large dozer shovels as retaining walls.

Dredge No. 4
Dredge No. 4

We were tasked with finding the source of the placer gold in the Indian River.  We stayed at Big Al’s camp and were exploring mineral claims that overlapped his placer claims.  His knowledge of gold bearing benches as well as historical research was very important in our search.  Likewise our findings were beneficial to Al in exploring new placer areas.  Most of our time was spent exploring old miner’s trails on quads and by foot.  I’d be lying if I said it wasn’t a great time.

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We came across several old mine shafts and evidence of placer mining was everywhere.  My crew participated in some of Big Al’s cleanups too.  It was exciting to see the amount of gold that he was pulling out.  We participated in all the steps of his cleanup process from cleaning the sluice to the concentrator jig and so on.  At each stage a fair amount of rum was consumed it seemed fitting when surrounded by hundreds of ounces of gold.

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Yup, that's exactly what it looks like.
Yup, that’s exactly what it looks like.

In our hard rock exploration we employed several techniques utilizing traditional prospecting as well as soil sampling and statistical pebble counts.  The soil sampling was conducted with helicopter support which made it a lot easier.  We were bagging close to a hundred samples per day each which was more than we could carry in the bush.  At the end of the day we’d chop out a helicopter landing area and radio the chopper.  Then we’d pick up the samples that we cached during the day.  Hard work but a lot of fun too.

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We spent a total of six weeks prospecting the area.  We took a lot of samples to be sent in for assay from all over the claims.  Prospecting in the Yukon is similar to BC, there is not a lot of exposed rock around.  Unlike the barren lands of the North West Territory and Nunavut there is plenty of forest and vegetation covering the rock.  We spent a lot of time in the helicopter scoping out rock outcrops.

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There seemed to be a correlation between the garnets that were showing up in the placer operation and high grade gold.  When the placer miners hit the paystreak they got a lot of garnets with it.  We started prospecting up a creek called “Ruby Creek” assuming it was named for the abundance of garnets.  The hunch turned out be be right.  We chased the garnets up to some large outcrops near the top of the mountain.  The samples contained a lot of garnet but not a lot of gold.

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From an old mineshaft that we found near a cabin we discovered that the miners hit a layer of pure quartz conglomerate.  And it was loaded with gold.  We then knew what to look for.  The search for the source of the Klondike gold continued for several weeks.  We encountered giant moose, grizzly bears, Northern Lights and some great people.  On several occasions we thought we found the fabled mother lode but the samples returned disappointing assay results.  Some of the more random samples showed the highest grades.  They say gold is where you find it.  We did not find the source of the klondike but we did manage to have a great time and got paid for it.

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Top Ten Gold Rushes of BC – Part 2

Top Ten Gold Rushes of BC – Part 2

In part one of the top ten gold rushes of BC we covered the early gold rushes primarily in the Southern regions.  As time went on gold hungry adventurers pushed further in the wild North of the Canadian West coast.  Their adventurous spirit was rewarded greatly and eventually led them into the Yukon and Alaska.

1865 Big Bend Gold Rush

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1897 Map of the Big Bend Area

The Big Bend refers to the shape of the Columbia River as it makes a huge detour at the continental divide.  This region encompasses several different mountain ranges including the Selkirks, the Cariboo Mountains, the Monashees and the Rocky Mountains.  In 1865 gold was discovered on French Creek which is straight North of Revelstoke.  As in other gold rushes a town was quickly erected named French Creek City.  Within the first year the town reached a population of over 4000 people.  Nothing is left today but during the rush French Creek had a general store, saloons with cabaret shows, barber shops and of course brothels.  Other important towns of the rush were La Porte and Downie Creek.  The inhabitants came mostly from the Wild Horse area and other areas in BC.

Steamboats were a major factor during the big bend gold rush.  Many of the prospectors reached the area on steamboats via the Arrow Lakes which make up part of the Columbia River.  The lake network allowed boat passengers to travel from areas as far South as the US border.

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Columbia River Steamboat, the “Rossland”

Other notable creeks in the area are Carnes Creek, Downie Creek, McCullough Creek, and the Goldstream River.  A 14 ounce nugget was reported to be found on French Creek and numerous smaller nuggets were also found.  In 1865 miners were bringing out multiple ounces per day to the man on some claims.  On McCullough Creek pay streaks averaged 1/8 of an ounce per yard for many years.  Just like other places in the late 1800s hydraulic and drift mining driven by mining companies and syndicates quickly replaced hand mining techniques.  The big bend gold rush only lasted two years but mining in the area continues to this day.  Several large projects and proposed mines are located in the big bend.

1869 Omineca Gold Rush

The Omineca is a huge region in Nortn-Central BC.  The southern boundary is marked today by the Yellowhead highway the North boundary is the Liard Mountains.  Gold was first discovered in the Omineca in 1861 but the rush didn’t take place until eight years later.  The original discoveries were made on the Finlay River.  In the early days there were very few people in the area due to a complete lack of trails, roads or maps and unforgiving terrain and weather.  Much of the area is still wild today.

Northern BC circa 1898, red symbols are known gold discoveries
Northern BC circa 1898, red symbols are known gold discoveries

One of the first claims on the Finlay called Toy’s Bar produced 4 ounces to the man each day.  Several expeditions were launched though the area searching for gold.  One such party, the Peace River Prospecting Party, found a great discovery on Vital Creek in 1869.  The creek was named after one of the party members, Vital Laforce who was also instrumental in exploring the Cariboo region.  Vital Creek produced nearly 5000 ounces in the years following the rush.

Manson Creek and the Germansen River held the best gold deposits in the Omineca.  Gold discoveries were also made on Blackjack Creek, Kildare Creek, Mosquito Creek, Slate Creek and Nugget Gulch.  In the early days of the gold rush anything less than an ounce a day was considered unworthy.  Many creeks were paying 100 ounces per week.  If the gold rush happened today that would be well over $100,000 every week.  I’d be finding my way up there any any means possible.  Travelling to the Omineca in the 1800s was a feat in itself.

The discovery of gold in the Cassiar in 1873 spelled the end of the Omineca gold rush.  As with all gold rushes those who held good ground stayed and kept mining while everyone else headed on to the next boom town.  The Omineca is one of the least explored regions in BC today and there are still gold strikes waiting to be found.

1873 Cassiar Gold Rush

Gold was discovered on the Stikine River in 1861 and a minor rush developed.  A few hundred prospectors ascended the river in search of gold.  There was an existing fur trading fort at the mouth of the river called Fort Stikine which later became Wrangell, Alaska.  Not enough gold was found to entice more adventurers to the region but the excitement was enough to prompt Britain into claiming the region as a colony in 1862.

Cassiar region circa 1893
Cassiar region circa 1893

The Cassiar gold rush really took off once the high grade gold deposits in the extreme North of BC were discovered.  This part of the country is extremely rugged with huge mountains, glaciers and a very cold winter.  The discovery was made in the summer of 1872 by Henry Thibert and Angus McCulloch on a creek that drains into Dease Lake.  The creek was named after Thibert who froze to death the following winter.  Thibert Creek was very rich, in the first year miners were getting up to three ounces to the pan.

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The 52 oz “Turnagain Nugget” from Alice Shea Creek in the Cassiar

In 1874 an even bigger discovery was made further North on Mcdame Creek.  The largest gold nugget ever found in BC was taken from Mcdame Creek tipping the scale at 73 ounces!  Another giant nugget was found on Alice Shea Creek that weighed 52 ounces.

Several towns sprung up near the gold discoveries such as Laketon, Porter Landing and Centerville.  They are all ghost towns now but in the height of the rush thousands of people were passing through the shops and saloons of the Cassiar.  Like the Omineca much of this region is just as wild today as it was 150 years ago.

The Cassiar’s rich gold reserves have not been forgotten.  There are many large mining projects under way in the region.  Due to the high grade mineral deposits the area is known as BC’s “Golden Triange”.
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1885 Granite Creek Gold Rush

Granite Creek is a tributary to the Tulameen River.  In the gold rush era of the late 1800s the Tulameen was still a remote and wild area.  Like many of the best discoveries the Granite Creek gold was found by chance.  In this case it was actually found by a cowboy named Johnny Chance.  In the summer of 1885 Chance was delivering some horses to New Westminster and took a route through the Tulameen.  True to his lazy nature he took a nap at a spot on Granite Creek on a hot day.  When he woke up he happened to notice the reflection of some gold nuggets in the water.

Granite City in 1888
Granite City in 1888

Within a year of the discovery the once vacant valley at the mouth of Granite Creek had over 2000 people living there.  At the time Granite City was the third largest town in BC.  There were over two hundred buildings, 13 of which were saloons.  The town never had a school or a mayor though.  The bars in Granite ran flat out and never closed down.  It was known as one of the wildest towns in the West.

In the early days gold nuggets weighing 5-10 ounces were commonly found.  Platinum was also prevalent on the creek.  Miners were producing equal weights of platinum and gold.  Interestingly for the first few years the Granite Creek miners had no idea what platinum was and most of them threw it back into the creek.  At today’s prices gold is going for $1077/oz and platinum is at $870/oz.

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Granite City in 2015

The Granite Creek rush brought attention to the surrounding area as well.  Other notable creeks in the Tulameen are Slate Creek, Lawless Creek, Lockie Creek and the Tulameen River.  Gold and platinum are still being produced today.  I heard from a Princeton local that the biggest nuggets to come out of the Tulameen this year were over an ounce.  I have some claims on Granite Creek and the Tulameen River myself.  Check this post from earlier this year Tulameen Prospecting Trip.

By the end of the 1890s the population of Granite City began to decline.  The easy gold was all claimed and in the process of being mined.  Those that didn’t already hold good ground headed North to try their luck in the Atlin and Klondike gold rushes that followed.

1898 Atlin Gold Rush

Atlin area map 1898
Atlin area map 1898

The Atlin gold rush was the last one to take place in BC.  It was a direct offshoot of the Klondike gold rush that took the world by storm.  The Klondike was the mother of all gold rushes, over 100,000 adventurers poured into Dawson City, YK from all over the world.  Some of the adventurous prospectors took a different route and ended up in Atlin.

The first big discovery was on Pine Creek.  A town was set up on Pine Creek aptly named Discovery.  At it’s peak there were over 10,000 people living in Discovery which was rivalled only by the infamous Dawson City.  Discovery had all the excitement of Dawson.  There were saloons, brothels, and gambling available at all hours of the day.  Discovery is a ghost town today, it was replaced by the town of Atlin.

Discovery Townsite in 1909
Discovery Townsite in 1909

The gold that was found in the Atlin area was truly legendary.  It is estimated that over 1.5 million ounces of placer gold have been produced from the creeks.  Some giant nuggets were found too.  Several creeks are known to have produced nuggets in excess of 50 ounces!  The best placer gold creeks were Pine Creek, Spruce Creek, Ruby Creek, McKee Creek, Birch Creek, Boulder Creek, Otter (Surprise) Creek, and the McDonnel River.

Atlin is a beautiful town, I had the pleasure of working up there a few years ago.  In the early 1900s it was nicknamed the “Switzerland of the North” due to the picturesque mountain setting.  In many ways Atlin is like Dawson City’s little brother.  The music festival is smaller, the gold rush was smaller, less gold was produced but the Klondike is nowhere near as scenic.

Atlin Today
Atlin Today

Gold mining in Atlin has never stopped.  Every time the gold price spikes the area receives another mini gold rush.  There are a lot of large hard rock mining prospects in the area as well.  The region is not far from the golden triangle and benefits from similar underlying geology.  Due to its remote location the area is very under explored and has outstanding potential for exploration.

The BC gold rush period lasted just 50 years.  Many of the participants experienced more than one rush in their lifetime.  It would have been an amazing time to be a prospector.  Here’s a recap of the top ten BC gold rushes:

  • 1851 Haida Gwaii Gold Rush
  • 1858 Fraser River Gold Rush
  • 1858 Rock Creek Gold Rush
  • 1859 Cariboo Gold Rush
  • 1863 Wild Horse River Gold Rush
  • 1864 Leech River Gold Rush
  • 1865 Big Bend Gold Rush
  • 1873 Cassiar Gold Rush
  • 1885 Granite Creek Gold Rush
  • 1898 Atlin Gold Rush
The history of British Columbia is the history of gold and the men who hunt for it.  It was the Fraser River gold rush that led to BC becoming a colony and later a province.  Our towns, overland trails and roads, and much of the early infrastructure was built to support gold mining activity.  Without our lust for precious metal men would not have risked their lives to explore the rugged and unforgiving wilderness of this beautiful province.
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Top Ten Gold Rushes of BC – Part 1

Top Ten Gold Rushes of BC – Part 1

Prior to the gold rushes in BC this part of the country remained almost entirely unexplored.  The Clovis people and their descendants the North American Indians were the first settlers of North America.  The Clovis crossed the Beringia Land Bridge from Siberia to present day Alaska approximately 13,500 years ago.  When Europeans began exploring the area, first by sea in the late 1700s and later by canoe, they encountered aboriginal groups covering much of the province.  Many Indians had seen gold in creeks but had little use for it.  They did not have the knowledge or motivation to mine gold until they came into contact with Europeans.  After learning the value of gold to the British they began to mine it and trade for goods.

Map of British Columbia Goldfields circa 1858
Map of British Columbia Goldfields circa 1858, click for larger image

The Spanish explorers on the other hand were completely obsessed with the yellow metal.  Spanish explorers were motivated primarily by legends of “El Dorado” in their search of the Americas.  Each Spanish explorer had the ultimate goal of returning to Spain with a ship full of gold.  Most of their attention was focussed in South America where their superior weaponry, armour and small pox allowed them to quickly decimate tribal empires and steal their gold.  There is evidence of Spanish gold exploration in BC as well.  Most of the Spanish exploration took place on Vancouver Island and other coastal areas such as Haida Gwaii.  One Spanish expedition travelled inland as far as the Okanagan and Similkameen regions.

Fur trading is what led to the first European settlement of British Colombia but the impact remained relatively small.  The first settlements were established by early explorers such as Simon Fraser, Alexander Mackenzie, and David Thompson.  Early forts were established along the river routes that these explorers used as well as along the coast.  The area became a recognized fur trading district called New Caledonia and it held that name until it became a British Colony in 1858.

Fort St. James was founded in 1806 and was the first major inland fur trading post in BC and still bears that name.  Other notable early forts are Ft. George (now Prince George), Ft. Kamloops, Ft. Langley and Ft. Victoria (1844).  During the fur trade the European population slowly grew to a few hundred people but little effort was put into exploring new ground outside of the established trade routes.

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1851 Haida Gwaii Gold Rush

The Haida Gwaii gold rush was the first recorded gold rush in BC but was very short lived due to hostilities with the local natives.  The rush began in 1851 when a Haida man traded a 27 ounce nugget for 1500 blankets in Fort Victoria.  A Hudson’s Bay Company ship was sent up there soon after and discovered a very high grade lode deposit.

The HBC crew began mining the lode deposit but the Haida Indians soon turned against them and prevented further mining.  In 1852 a ship with 35 adventurers from San Francisco set out for the islands.  They arrived at “Gold Harbour” in the Tasu Sound but did not have much luck finding gold.  They did however manage to trade with the Haida Indians for gold.

1857 Gold Found At the Nicoamen River

Placer gold was discovered in Nicoamen River which is a tributary to the Thompson River.  The Nicoamen enters the Thompson about 12 kilometers up stream from the confluence with the Fraser River at Lytton.  A local Indian discovered gold there by chance and soon the majority of the tribe was mining the area.  This discovery is credited with igniting the Fraser River gold rush.

1858 Fraser River Gold Rush

The Fraser River gold rush involved one of the largest populations of migrant prospectors in history.  It is estimated that around 30,000 people rushed to the lower Fraser River in 1858.  The rush began after an 800 ounce gold sample was sent from Fort Victoria to San Francisco for assay.

Yale in 1868
Yale in 1868

Soon after a shipload of 800 American prospectors from California arrived in Victoria to hunt for gold on the Fraser River.  The influx of American prospectors overwhelmed the small government that managed the territory.  HBC Governor James Douglas requested immediate help from Britain to control this massive foreign population .  The British Government responded by formally claiming BC as sovereign British Colony in 1858.  The new government quickly enacted mining laws to prevent the mayhem that took place in the California goldfields.  Along with the declaration came British military support and the Royal Engineers who went on to build several major road systems including the Cariboo Wagon road and Dewdney Trail.

The early work centred around the community of Hope where steamboats allowed for easy access.  The majority of the gold rushers were participants in the California gold rush that fizzled out a few years earlier.  As a result the population of Yale was largely american and the town was modelled after San Francisco.

Lower Fraser River Circa 1862
Lower Fraser River Circa 1862

A story in the San Francisco Bulletin is credited with igniting the rush.  According to the newspaper:

“In one month the Hudson’s Bay Company fort in Victoria had received 110 pounds of gold dust from the Indians … (prospected) without aid of anything more than … pans and willow baskets.”

Numerous bars were prospected and mined between Hope and Lytton.  Some communities along the Fraser are still named after the bars that were mined such as “Boston Bar”.  Like most gold rushes the men who arrived first snapped up the good claims and the the majority of the adventurers ended up working for them.

Cariboo Wagon Road in Fraser Canyon 1867
Cariboo Wagon Road in Fraser Canyon 1867

The British Royal engineers developed a route from Port Douglas at the head of Harrison Lake to Lillooet to accommodate the influx of miners.  Many new communities popped up and some are still settled today.

The Fraser rush brought people from all over the world but the bulk of the miners came from California.  At the peak of the rush there were over 10,000 miners operating on the section of river form Hope to Lillooet.  The bars depleted rapidly and by 1860 most of the miners continued on the other gold rushes in BC.

1858 Rock Creek Gold Rush

Gold was discovered in Rock Creek in 1858 soon after miners rushed in from the United States and the rest of the world.  The Rock Creek rush was also instrumental in the development of British Columbia.  The discovery was made by two American soldiers who were chased North of the boarder by a band of Indians.  Just 5km from the border where an unnammed creek entered the Kettle River they found gold.

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At the time of the discovery the colony of British Columbia was only a year old.  American miners tried to claim the area as part of the United States due to the high grades and the fact that it was discovered by Americans.  The Rock Creek claim issues prompted the construction of the Dewdney Trail as a means to separate the new colony from the United States.  The Dewdney Trail snaked its way from New Westminster all the way to Wild Horse in the Kootenay region staying just North of the Canada-US border.

Soon after the discovery an estimated 5,000 prospectors migrated to the newly established town of Rock Creek.  In the beginning there were two saloons, a butcher’s shop, a hotel and five stores.  Within the first year a revolt broke out due to tensions between Chinese and American miners and refusal to pay for mining licences.  The incident became known as the Rock Creek War.  The governor of British Columbia Sir James Douglas travelled there from Victoria to straighten out the miners.  He threatened to send in 500 British soldiers if they couldn’t behave themselves.  Sir Douglas was successful and soon the miners paid their claim fees and mined the creeks in peace.

There were some amazing claims on Rock Creek.  Adam Beame’s claim on Soldier’s Bar  in 1859 allegedly netted $1,000 in six weeks.  That gold would be worth $70,500 today!  Other bars such as Denver Bar and White’s Bar produced similar results.

1859 Cariboo Gold Rush

Gold was discovered on the Horsefly River in 1859 by prospectors who participated in the Fraser River rush.  They were guided by a local Indian and shown a spot on the Horsefly River with abundant gold and nuggets the size of wheat kernels.  The rush was on as more miners from the Fraser River rush migrated North to the Cariboo.  Soon a town was erected near the strike that exists today.

Cariboo Map Circa 1862
Cariboo Map Circa 1862

In 1860 gold was discovered on Keithly and Antler creeks to the North of Horsefly.  Other notable creeks of the region are Lightning, Lowhee, and Williams Creeks, the Quesnel River and Parsnip River.  Towns popped up all over the place with the most exciting being Barkerville.  That town was named after a British prospector named Billy Barker and had a popluaton of 10,000 at its peak.  His claim on Willams Creek was one of the greatest gold producers in history yielding an estimated 37,500 ounces of gold.  Barkerville was restored in 1997 as a tourist historic town that is a popular attraction in the area.

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Barkerville circa 1868

The Cariboo gold rush saw 100,000 people flood into the area during 1862-70 from all over the world.  By 1864 the Cariboo Wagon Road was completed from New Westminster all the way to Barkerville.  This allowed for easy travel of people and supplies, wich substantially brought down the costs.  It also allowed for stage coaches to securely move gold from the mines.  The stagecoaches operated on this road from 1863 to 1917 carrying people, mail, express packages and of course gold.  The stagecoaches saw surprisingly few hold ups, even though they carried literally tons of gold.  There are only five hold ups on record, two of which were successful.

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By 1870 the gold rush had largely fizzled out.  The good claims were now owned by mining companies who could gather the money needed to undertake underground drift mining.  Those who didn’t stick around to work in underground mines spread around other parts of BC’s North and some sparked gold rushes in new areas.  Others settled in and started up cattle ranches or logging companies.  Gold mining in the Cariboo is still active today, as a matter of fact I have a couple claims near Keithly Creek.

Cariboo Drift Mine
Cariboo Drift Mine

1863 Wild Horse River Gold Rush

Gold was discovered on the Wild Horse River in the Kootenay region in 1863 once again by American prospectors.  The Wild Horse held great gold reserves and still does today.  Early in the rush huge nuggets were found with the biggest tipping the scale at 36 ounces.  The first town that was built was called Fisherville.  Apparently after one resident found a nugget under his house the size of his fist the whole town burned their houses down to dig underneath.

A town was erected named Galbraith’s Ferry, named after John Galbraith who operated a ferry across Kootenay lake.  Later the town was re-named Fort Steele after the legendary Sam Steele.  A second gold rush broke out in the same area in 1885.  Later hard rock silver rushes spread around the region.

The Wild Horse River is estimated to have produced over $7,000,000 in the initial gold rush which would be worth about $490,000,000 today.  There is a very well preserved historic town at Fort Steel that is a popular tourist spot with many actors playing the roles of old time blacksmiths, prospectors, sheriffs and so on.  It is located North of Cranbrook at the intersection between Highway 93 and 95.

The initial gold rush ended after about 6 years but soon the great silver rush would flood the region.  Places like Nelson, Kaslo, Slocan grew out of the silver rushes that blanketed the Kootenay region.

 

1864 Leech River Gold Rush

The Leech River gold rush started with a letter from Robert Brown who was Commander of the Vancouver Island Exploring Expedition.  Yes that was the correct name of the VIEE expedition.  The expedition was launched by the British government in Victoria.

1880Leechtown
1880 map depicting the locaton of Leechtown

A letter from Brown published in the British Colonist newspaper on July 29, 1864 ignited the rush.  Here are some exerpts from the letter:

..the intelligence I have to communicate is of too important a nature to bear delay in forwarding to you, even for one hour…

The discovery which I have to communicate is the finding of gold on the banks of one of the Forks of the Sooke River, about 12 miles from the sea in a straight line, and in a locality never hitherto reached by white men, in all probability never even by natives. I forward anquarter eighth of an ounce (or thereabouts) of the coarse scale gold, washed out of twelve pans of dirt, in many places 20 feet above the river, and with no tools but a shovel and a gold pan. The lowest prospect obtained was 3 cents to the pan, the highest $1 to the pan, and work like that with a rocker would yield what pay you can better calculate than I can, and the development of which, with what results to the Colony you may imagine.

Leechtown - Berks Hotel
Leechtown – Berks Hotel

A town called Leechtown was built near the discovery.  By November that year there were an estimated 6 general stores, 3 hotels and over 1,200 miners at work in the area.  By 1866 an estimated 200,000 ounces of gold had been produced in the area and the gold rush had passed its peak.  It was over in a flash as the Leech and Sooke river placer deposits, although high grade, were limited in size.

In the span of one decade gold rushes turned the vast unexplored fur trading district of New Caledonia into a sovereign British Colony.  By the end of the 1860’s the new region had gone from a population of under one thousand people to a colony with several major wagon roads and towns covering much of the Southern half of BC.  The gold rushes continued and led to more development in British Columbia.  Stay tuned for part 2.

Check out part two here:

Part 2: Top 10 Gold Rushes

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Late Season Prospecting on the Fraser

Late Season Prospecting on the Fraser

This claim is located in the Cariboo-Chilcotin region of BC.  The location is fairly remote and there are no paved roads for quite a distance in any direction.  When you are out there you are definitely alone.  It has sort of an eerie feeling all day and night, it feels deserted.  There is a ghost town near the claim and some signs of a more active human presence from a distant time.  Check out this post for pics on of the ghost town, Southern Cariboo Prospecting Trip.

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The hike down to the river is pretty tough.  There is about a 1000 foot elevation change from the access road to the river.  We went down there the first day to sample the beach.  We came across a couple of bedrock outcrops which prevented us from travelling any further.  The bedrock had some gold stored in the cracks and we were able to get some of it out.  Near the river we saw some decent colour in our test pans.  We marked the locations on my GPS and made our way back up to the camp.

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We had some great burgers cooked on the campfire and a couple of beers.  It is getting pretty cold up there this time of year.  Once the sun goes down the temperature quickly falls below freezing.  We had a nice big fire and enjoyed the stars for the evening.  It was pretty tough to get out of our tents in the morning.  The moment when you unzip your sleeping bag and start putting on cold clothing is the worst.  I’d like to stay in my nice warm bag for a couple more hours but we came up here for a reason.
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We found an old claim post with tags from 1989/90 right in the center of the claim.  The post was actually carved out of a tree trunk and is the most creative claim post I have ever seen.  As far as industrial markers go this is a work of art.  I hope to find out more about this G. Johnson and what he had discovered on the claim.

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As we were making our way down to the river for day two of prospecting we came across a creek that seemed to appear out of nowhere.  My partner noticed some gravel near the surface and we thought we might as well pan it.  In that pan we saw a small coarse chunk of gold.  This was pretty exciting since it was located several hundred feet above the river.  We took several more pans in that spot and found a little bit of gold in each one.  Now we have to find out where that mysterious little creek is getting the gold from.

Bazooka

My partner had a Bazooka Gold Trap and we tried it out on this little creek.  The gold trap seemed to work pretty well.  It’s an interesting design that has a chamber at the back and a water scoop underneath that forces water into the trap.


That was our last trip of the season to this area.  The weather forecast says snow is coming this week and it will probably stick until the spring.

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7 Common Mistakes Made by New Placer Miners

7 Common Mistakes Made by New Placer Miners

Placer mining is an exciting activity.  It brings us out into the wilderness often to the road less traveled.  There is a certain charm associated with the hunt for gold.  In some ways it feels like an exclusive club where the only entry requirements are the knowledge, skills and the will to take on the challenge of finding precious metal on the earth’s surface.  For those starting out there is a lot to learn and all too often a novice miner’s decisions are influenced by greed or the infamous gold fever.  Here’s a list of some of the most common mistakes made by new gold miners.

  1. Buying too much equipment too early

    LotsOfGear
    Photo Source: www.tambang.id

    Placer miners are total gear nuts, myself included.  To run even a small operation you need a fair amount of gear.  Pans, sluices, digging tools, camping equipment, 4×4 truck, etc.  And there is plenty of gear on the market to spend your money on.

    However more equipment will not necessarily make you more money.  Often its quite the opposite.  In our fast paced consumer focused economy it is tempting to look for a quick fix.  There is no substitute for hard work though. You need to put in the time and effort to find that gold.  I have met several people who have purchased a brand new floating dredge with nowhere to use it.  Fortunately their equipment quickly finds its way onto craigslist at a discounted price.

    Prospecting starts with a gold pan, other tools that help are classifiers, snuffer bottles, and an accurate scale.  Once you have proven gold in an area you can look at moving on to something that can move more material.  The next progression would be a highbanker or a small diameter dredge (if they’re legal in your area).  If you have found enough gold and can’t move material fast enough the next steps are moving to a larger wash plant and possibly heavy equipment.  At each step along the way you need to assess the quantity of gold on your claim and the costs of getting it out.

  2. Buying the first claim that’s available

    ClaimPostIts pretty exciting to have the rights to your first claim.  You start dreaming of all the riches that are now yours for the taking.  Its tempting to snap up the first claim that is available.  Especially in areas with online staking, its a lot like buying concert tickets.  Unlike concert tickets though gold claims are usually available for a reason.  Perhaps the claim has poor access, little to no gold, or has already been mined to death.

    Do some research before you pull the trigger.  Read up on the history of the area to make sure it hasn’t been thoroughly mined already.  Make sure it has good access roads or trails.  Find info on previous production in the area and if possible sample the claim before you buy it.  Check some maps to make sure the claim is not on a park, reserve or private land.

  3. Poor or No Sampling

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    Effective sampling is absolutely essential to run a profitable placer mining operation. You wouldn’t buy a car without taking it for a test drive.  It is tempting to show up at a claim and start running a highbanker on the first gravel that you see.  Even some larger operations forgo proper sampling in the rush to get mining and lose a lot of money because of it.

    Sampling is not glamorous and you won’t get a lot of nuggets to show your friends but you need to know how much an area will pay before you spend time and money to produce it.Once you have thoroughly sampled an area and have calculated the pay per yard you will know how much you can spend to produce the gold.  For example if an area pays $100 to the cubic yard and your cost is $40/yd to produce it you will certainly make a profit.  Your proven reserve is sort of like a bank account.  You don’t want to spend more money on equipment than your reserves will justify.

  4. Not digging deep enough

    IMG_2420 Almost every novice prospector will sample surface gravels and expect to see flakes of gold.  Placer prospecting and mining hinges on the fact that gold is very dense.  Being heavy, gold will settle deep as it can in a gravel bed.  When digging a test hole you basically want to dig as deep as you can.  You want to reach compacted gravel before you start sampling.  In most cases your best gold will be on the bedrock.  In some areas there are clay layers or river armour layers that will trap the gold.  It will always travel down until something prevents it from sinking any further.

    There are areas where flood gold can be found near the surface.  It is important to know the history of your area.  Even if there is surface flood gold though the real paystreak will always be deeper down.

  5. Lack of knowledge of local mining regulations

    regs Just like other laws it is your responsibility to know the mining regulations for your area.  I have heard too many stories of guys panning or running river sluices in areas that they didn’t even know were claimed.  That is called claim jumping and is illegal.  In the gold rush days it was perfectly legal and acceptable to shoot a claim jumper.  Today claim jumpers can face a criminal record and imprisonment.

    The rules are not the same everywhere.  A suction dredge might be perfectly acceptable in one area and completely outlawed in another.  Dredges and highbankers area also regulated by water intake hose diameter and type of creek that you are working on.  Other regulations to look out for are environmental rules for drawing water and working in riparian zones.

    Laws regarding exploration on private land, provincial parks or first nations land must also be obeyed.  You have certain rights by holding a claim but that does not guarantee your right to dig in every situation.

  6. Unrealistic expectations

    Nuggets These days with the recent flood of gold mining TV shows it seems so easy.  They give the impression that all you have to do is show up with an excavator and a wash plant and you’ll start pulling out nuggets.  Often these shows have some arbitrary budget that the miner needs to reach by the end of the season.  Just seeing numbers like $500,000 per season will get anyone excited.  You may be thinking if they can get that I can at least get $1000 on a random claim.  Spending an hour per night watching guys pour jars full of gold flakes on shows like Yukon Gold or Gold Rush Alaska will fuel unrealistic expectations.

    The fact is gold is valuable because it is incredibly rare.  The value is largely due to the sweat equity of prospectors and miners who have spent lifetimes searching for the yellow metal.  It will be a long road to get your first jar full of gold or even a vial for that matter.  Prospecting for gold has an incredibly poor success rate.  You will put in hard work, digging, hiking and panning for long hours and won’t see more than a color.  Some days you won’t even see that.  Gold is defiantly out there but don’t expect to see any in your first pan.

  7. Improper technique with equipment

    Indian River Yukon
    Most placer mining and prospecting equipment requires skill and knowledge to operate effectively.  That is part of the appeal to prospecting, its a skill just like any other and takes time to develop.  There are a lot of people out there who are not using their gold pans properly and washing gold right out of the pan.  Likewise with highbankers, its a common mistake to mine all day with the wrong angle on your sluice.  There is a lot of info out there on proper techniques don’t just buy equipment and try to figure it out on your own.

    The best thing to do is go out with someone who is experienced with the equipment that you want to use.  You can watch Youtube videos all day but nothing beats hands on experience.  Most placer miners will welcome an extra hand to help work the claim, in the process you will learn everything you need to know.

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