The annual report of the Gold Sovereign Mining & Tunnel company just issued shows that the monthly value of ore shipments ranged from $28,372 in January to $14,261 in December, January being much the largest month of the year 1906.
The average value of the ore was well over one ounce, and shipments for January of this year were in excess even of the banner month of the year before, although figures for the first month of this year are not given.
The report of President A. Rapp states that results were not as flattering as anticipated owing to "unforeseen circumstances, notably the reduction works this company had contracted with closed operation last March, after which until November your company was compelled to sell their production on the open market, not being able to make satisfactory terms as to treatment charges, and which difference for the several months amounted to over $10,000 loss to the company, besides curtailing the production.
"Your company now has a contract for two years with a new mill just started (Golden Cycle) at Colorado City, by which a good profit will remain after treatment charges. As your property contains large bodies of low-grade ore, also large dumps, and which at this time are not yet marketable, it was decided to make a contract by which your company could cancel same at any time if they became interested in a reduction works, and from all investigation now being made, it is improbable that in the very near future low-grade ore will be successfully reduced here, leaving a good profit, in which case our company may erect its own reduction plant, after thorough investigation and certainty of success.
"Shaft No. 1, or main working shaft, is operated on company account, has one set of lessees on the sixth level, and one set in the tenth level. The greatest production is from the sixth level, the company receiving 50 per cent royalty from the lessees.
"The company has done considerable prospecting on the fifth, sixth and tenth levels. There was opened up 1,320 feet of drifts and crosscuts, exposing a great deal of low-grade ore for future mining. The cost of the several drifts and levels was $10 per foot, or $13,200. There was also a new hoist installed, costing, with other improvements, machinery, etc., $5,000.
"A new vein was discovered 30 feet west of the station of the tenth level, which runs parallel to the main vein or dyke, the ore was cut there and shows it to go down, a winze about four feet of ore which averaged $40 per ton. It appears that this is the top of the ore body, and as soon as the shaft is completed to the eleventh level, crosscuts and drifts will be extended. From all showing it is confidently expected that better and larger bodies of ore will be opened than before.
"Shaft No. 2 (Whisper) is producing regularly, but not a large tonnage; values are profitable.
"Shaft No. 5 (Lovett) has also produced regularly, leaving a fair margin. The royalties from these two lessees are 25 per cent.
"The other shafts have not produced nor been operated for nearly ten months.
"At this time there are en route and to be settled for by mill 23 cars of ore, the equity to your company will be about $4,000. The year 1905 showed no profits, but referring to the treasurer's report for 1906, a fair profit was made.
"From the general showing there is no reason why dividends will not be paid this year, and it will be the aim of the management to do so, conditional that the financial showing justifies the same."