Mining share

“ These deposits are naturally the first to fail in productiveness, but the neighboring hills are formed of a gold-bearing quartz which is being crushed, night and day, by hundreds of powerful machines; and the works still pay ten thousand miners fair day-wages, besides giving the organized companies who employ them satisfactory dividends. Thus mining has been largely robbed of its adventurous character in this neighborhood, and perhaps also of most of its alluring charm, having become a sort of regular industry, like coal-mining, or even brick-making. ”

“ The natural result of the existing condition of things is that the true owners of the mines are those who have invested no capital in them—the Government, the railway concessionnaires, the dynamite concessionnaires, and others. The country is rich, and under proper government could be developed marvellously, but it cannot stand the drain of the present exactions. We have lived largely upon foreign capital, and the total amount of the dividends available for shareholders in companies is ridiculously small as compared with the aggregate amount of capital invested in mining ventures. ”

“ From all of which it will be seen that nearly $4,000,000 may be given as the product of the mines up to May, 1870.
Nor are the mines, as a whole, decreasing in value. The promise of the past is the promise of the future. If results ave been encouraging, they may be fabulous. There are fields above and below unoccupied. It needs, simply, that capital, energy, and practical mining experience combine, to make this second to no hydraulic region in the State. The wealth is here, and it remains to be seen whether the forces that produce it are to bless with their coming and successful working. ”

“ All engineers must wish to have the industry under them in high repute. The writer knows of several mines paying 20% on their stocks which yet stand lower in price on account of short ore-reserves than mines paying less annual returns. The speculator, who is an element not to be wholly disregarded, wishes a rise in his mining stock, and if development proceeds at a pace in advance of production, he will gain a legitimate rise through the increase in ore-reserves. ”

“ It must be remembered that mining, though often so profitable, is nevertheless a destructive industry, thus differing from agriculture, which is productive, and manufactures, which are constructive. Every ton of stone broken and treated from even the best gold mine in the world makes that mine the poorer by one ton of valuable material; thus, to buy a mining property on its past reputation for productiveness is, as a rule, questionable policy, unless you know there is sufficient good ore in sight to cover the purchase cost and leave a profit. ”

“ No one will think of carrying ore to the power when it is far more economical and profitable to carry power to the ore. In this connection the principle of the division of labour becomes very important. In its bearing upon the mining industry generally, whether in its application to the precious metals or to those which are termed the baser, and even in the work of raising coal and other non-metalliferous minerals, the fact that nearly all mines [Pg 183] occur in groups will greatly aid in determining the separation of the work of supplying power, as a distinct industry from that of mining. ”

“ Since the extension of the railway systems and the establishment of a stable government, mining is again attracting a great deal of attention. The government encourages foreign investments in the mines. Many of the old bonanzas have been taken over by new companies with both good and bad results for the investors. The introduction of modern machinery has so reduced the cost of mining that lower grade ores can be profitably worked. ”

“ But let us ask, would any other business, even such as are less subject to unforeseen vicissitudes than mining, succeed under similar circumstances?
It is now very generally agreed that to the profitable development of mining new countries, at all events, must look mainly for prosperity, while other industries are growing. Therefore, we cannot too seriously consider how we may soonest make our mines successful. ”

“ Further improvements in the processes of reduction will doubtless increase the mining area, by making it worth while to develop mines where the percentage of metal to rock is now too small to yield a dividend. Improvements, moreover, tend to accelerate the rate of production, and thereby to shorten the life of the mines; for the more profitable working becomes, the greater is the temptation to work as fast as possible and get out the maximum of ore. ”

“ Under ordinary working conditions, it should be considered just as essential for a mine to take an occasional inventory as it is for a mercantile establishment. In truth, there is far more need in mining operations of the knowledge thus derived than in any other business. In mining, as already suggested, the business is one of selling off the stock in trade without replenishing it. The opening of more reserves of ore is not bringing more goods into the stock, but it may be likened to simply unpacking more goods in the storehouse. ”

“ The total returns from mining may not in the aggregate be far above the expenditure for exploration, development, and extraction; yet the total mineral wealth of the United States, on the basis of earning power and aside from the industries based on it, cannot be far from sixty billions of dollars, and this wealth has virtually come into existence since the 1849 gold rush to California. The mining industry supports a large population. These facts are the solid basis for the widespread popular interest in mineral investment—and mineral speculation. ”

“ It may be taken as a safe axiom that to make gold mining in the mine as distinct from mining on the Stock Exchange really profitable the same system of economy, of practical supervision, and scientific knowledge which is now adopted in all other businesses must be applied to the raising and extraction of the metal. Then, and not till then, will genuine mining take the place to which it is entitled amongst our industries. ”

“ Due consideration must always be given to the selection of some method of opening up what might be supposed will never amount to a great mine, so that, should subsequent disclosures exceed expectations, enlargement of the scale of operations can be advantageously effected. Always bear in mind that legitimate mining is just as much a commercial enterprise as is any other kind of business. The utmost concern for financial showings must be constantly borne in mind. Select a scale of operations consistent with the known—not the hoped-for—bodies of coal or ore ”

“ After a mine is once opened and preparations have all been perfected to operate [106] upon a certain scale of output, it is quite essential that exploitation and production be maintained without material fluctuations, if the greatest economy is to be attained. Exploitation, i.e., development work, must be kept well in advance of actual mining operations to assure plenty of working space for the extraction of the normal output. ”

“ The latter is a thing apart from the relation of employer and employee, which in all producing occupations is purely local in character. Extraction of coal from the mine is the aim and the completed result of local activities. Commerce in the coal mined is not brought into being by force of these activities, but by negotiations, agreements, and circumstances entirely apart from production. Mining brings the subject matter of commerce into existence. ”

“ Poor ores are now worked profitably which used to be neglected by the miners; and, as these ores occur in almost inexhaustible masses, their mining is a much less speculative affair than the old system of mining for rich veins. Moreover, the men are, in some of the largest mines, paid by the day, so that their life has become more regular. In many places, however, the work is still done on shares by the miners, who pass their lives in alternations of excessive riches and all kinds of extravagance, succeeded by times of extreme poverty. ”

“ Further than this, it is often contended that, as the capital expended in purchase and Page 39 equipment must be redeemed within the life of the mine, this item should also be included in production costs. It is true that mills, smelters, shafts, and all the paraphernalia of a mine are of virtually negligible value when it is exhausted; and that all mines are exhausted sometime and every ton taken out contributes to that exhaustion; and that every ton of ore must bear its contribution to the return of the investment, as well as profit upon it. ”

“ There is a modern idea that has taken root in the minds of mining men of the last generation to the effect that the mines with rich ore are not necessarily the ones with big profits. There are many men looking for investments in mines whose contents are of low grade but in large bodies readily worked. If a mine with rich ore can be found and the ore abounds in such liberal amounts as to warrant the inauguration of a company with the essential working equipment, such a proposition will naturally not be turned down. ”

“ Such companies, with superior mechanical facilities to do much labor, in a short space, will be enabled to go over the whole mineral field, although already dug over by individuals, and reap yet a rich reward of their efforts. And when there will be no more gold washing to be done, then a new era in the mining of the country will commence—we mean a regular system of mining by sinking shafts into the very bowels of the rocks will be entered upon. ”

“ My father knows nothing about mining himself, and he has not even had an expert's opinion upon it. He goes entirely upon the Count's word, and what the Count chooses to show him. Why, the mine isn't being worked—hasn't been worked for thirty years."
"Perhaps," I suggested, "the Count hasn't the capital to work it. Labour out here's mighty cheap, but up-to-date mining takes a lot of money." ”

“ In irregular and uncertain deposits this work of development should be kept at all times so far in advance of mining operations as to ensure a regular and uniform output. In some cases, where the barren areas are large, it may be necessary to have two or three years’ supply of ore thus blocked out in advance. A mine, however, may be over-developed, which results in loss of interest on the capital unnecessarily locked up for years by excessive development, and involves additional cost for the maintenance of such openings until they are needed for active mining operations. ”

“ Far from denying that mining is, in comparison with better-class government bonds, a speculative type of investment, it is desirable to avow and emphasize the fact. But it is none the less well to inquire what degree of hazard enters in and how it compares with that in other forms of industrial enterprise. ”

“ The system has produced an increasing class of mining speculators and investors who are finding and supplying the enormous sums required to work our mines,—sums beyond the reach of the old-class single-handed mining men. Every year the mining investors of the new order are coming more and more to the engineer for advice, and they should be encouraged, because such counsel can be given within limits, and these limits tend to place the industry upon a sounder footing of ownership. ”

“ I am told that in America all mining is done by individuals or private companies, and that four-fifths of all mining companies have no mines at all—merely samples of ores, blueprints, photographs and prospects. The genus promoter is a very modern production, and is a creation Humboldt never knew ”

“ One means of providing against an extinction of a mining company's activity with the exhaustion of the ore bodies in the mines is to provide new mining territory to which operations may be transferred at the proper time. This plan has been very successfully carried out by a number of large mining companies. When a mining company has been maintaining its identity for a considerable period, it has reached a very desirable stage of economy in the make-up of its various lists of officials, superintendents and engineers. ”

“ The wages are not high, and only those in straitened circumstances, the dissolute, and profligate, who have no homes of their own, are inclined to let themselves to labor in gold mines.
Many works are extensive, and employ a thousand or more laborers each. The government grants mining privileges to individuals on certain conditions. ”

“ The price of gold, which is itself the standard of value, could not rise to offset growing mining costs and to maintain profits, as was the case with iron, copper, and the other metals,—with the result that the margin of profit in gold mining became so small as materially to affect exploration and production. Another important cause of decreased production was the actual exhaustion of certain mines, and the lowering of the grades of ore available in many others. ”

“ Some of the ore from both kinds of mines-between 10 and 20 per cent.-is concentrated by washing or beneficiated after coming out of the mine and before starting out of the state, but our conclusion respecting the usual operations renders this deflection immaterial.
Plainly the facts do not support the contention. Mining is not interstate commerce, but like manufacturing, is a local business, subject to local regulation and taxation. ”

“ It is true that much fraud has been prevented in the practice of taking up Government lands and it is also quite true that the Forest Service is endeavoring to uplift the mining industry in the western portions of the United States.
Mining is bound to become a still stronger factor in civilization as metallurgical processes multiply and there are discovered means of more economically extracting the valuable contents of ores. ”