By JOHN WELLINGTON FINCH.
CRIPPLE CREEK has survived the labor war of the past year and is now more energetic than ever before. Since the first month of its existence, there has always been lurking in the most vital activities of the camp the insidious and once apparently ineradicable spirit of industrial turbulence, which became a menace to its very existence in 1894 and even more threatening in 1904.
It is greatly to the credit of the district that the community seems at last to have learned that spite and controversy between employer and employee breed a host of evils which attack the sources of maintenance and sap the very life of both.
The cost of a labor strike resolves itself into the losses to the operator and the losses of the striker. The latter involve the maintenance of the striker and his family with no wages; contribution, if possible, to the belligerent organization; and, particularly, the grave danger of being ostracized from future employment in the district affected.
The cost to the mine operator appears in the actual cessation of production, with the continuation of the usual fixed expenses; and in the enormous expenditure for the protection of property and the maintenance of his rights in the controversy.
No one not familiar with it has an adequate conception of the enormity of this combined loss in such turbulent times as prevailed last year in Cripple Creek.
No other industry could maintain for so long a period such a ruinous warfare; no other class of labor receives a scale of wages which would embolden them to undertake it. In the wicked expenditure of money and the waste of property, it ranks next to the wars of the nations.
The actions of the labor unions during the past year has discouraged capitalists from looking in this direction with a view to investment. Many specific investments definitely planned in Colorado and the Rocky Mountain States during this period have been diverted to Mexico or the Canadian provinces of the Pacific Coast.
However, the controversy is now permanently ended. The Smeltermen's Union, which instigated it, has declared its cause lost. The local authorities of the county and district have demonstrated their ability to permanently maintain order in the camp.
No reduction of wages has been or will be made by the operators; hence, there can be no justifiable basis for the renewal of hostilities by the local labor organizations, who were at no time demanding higher wages, but were striking in sympathy with the smelter and mill workers.
A REVIEW OF THE YEAR
The production of 1904 has, as usual, been somewhat overstated in the newspapers. The output was greatly curtailed during the strike period, but in the last four months of the year it increased in value to more than a million a month. For the entire year, the State Bureau of Mines shows a total of $11,862,509.95.
The month of December made the best record, in round numbers about $1,150,000.
The following summary of notable discoveries and developments in 1904 may not include everything of importance; any omissions, however, are due to lack of complete information. These individual cases are intended to show both the condition of the district and to serve as illustrations of certain important facts.
The two most conspicuous localities of new development are the east slope of Ironclad Hill and the west side of Beacon Hill, but not because they have yielded the greatest output.
The palm of production still rests with the Victor section of Battle Mountain and the Independence region of Bull Hill, as has been the case for a number of years.
Beacon Hill has been developed by strong companies, besides having a particularly large and persistent series of ore deposits.
The Ironclad region shows ore just as rich or richer, but in bodies of much less magnitude.
Beacon Hill. - The El Paso of Beacon Hill has been the feature of the year. The C. K. & N., and more recently the Beacon Hill Ajax and Old Gold properties, have shown a heavy production of high grade ore like that of the El Paso and from the same general system of veins.
This series of developments is instructive from the fact that rich ore in one mine inspired activity in adjoining property, where for years indications had been regarded as only moderately favorable.
These properties are located in the granite area south of the main volcanic mass of the district. The granite is cut by a series of northeast-southwest dikes, with associated veins which in the past had made an intermittent production.
More lately, it is understood, a vein striking northwest has been worked, which has supplied at least an important part of the year's output from these properties. It intersects the former series and, besides containing somewhat continuous ore, is characterized by particularly rich and extensive segregations near the points of intersection.
On the east slope of Beacon, the results of the prevailing leasing system began to appear only towards the close of the year. The bottom level of the Gold Dollar Cons, has recently revealed considerable ore.
The relations of the veins are not as yet fully understood, but some of these discoveries are believed to be entirely new. Reports begin to come in of successful exploration on the surface in this vicinity.
Ironclad Hill. - The W. P. H. is a good illustration of the results of the leasing system. This lease, now expired, has been one of the notable shippers of the year, both in tonnage and in the remarkable tenor of the ore.
Prospecting was inspired by the temporary success of the Damon and Jerry Johnson several years ago, in territory adjoining to the south and in the same somewhat complex system of small intersecting fissures at or near the contact of the volcanic body of the district with the older granite.
It is also an additional suggestion that the richest ore deposits of Cripple Creek are usually found along the periphery of the volcano, where the country is most intricately fissured.
The W. H. P. produced in 1904 a higher average grade of ore than ever before mined from any single property in Cripple Creek during a similar period.
Of the more recent new discoveries in this region, probably the most important has been made in the Forest Queen, north of the W. P. H., shown in the background of Fig. 2.
Although not thoroughly opened up, the promise of persistence is good and the mine has been making a production of high grade ore for some time. It is interesting to compare the equipment of these two leases with that of the El Paso, as shown in Fig. 1.
The latter is being operated on a generous scale by a strong corporation and markets hundreds of thousands of dollars worth of ore, while the leases sell tens of thousands, also probably at a larger profit per ton for the same grade of ore.
The work on these two properties has given a great impetus to the development of neglected sections.
The only other property on Ironclad Hill known to the writer as having been especially prominent in the latter part of the year is the Teutonic, no doubt chiefly because of its proximity to the W. P. H. Reports have been current of the discovery of ore in the main development workings on the easterly end of the claim, but these have not materialized in shipments and are otherwise not well authenticated.
Towards the western end of the claim, near the surface in a new shaft, a well-confirmed discovery has been made of eighteen inches of good ore.
Bull Hill. - Probably the new operations of the greatest magnitude and earning capacity in Bull Hill have been in the Shurloff claim, recently acquired by the Finley Cons. Company. This ground has been prospected under a well directed and vigorous policy, and a series of veins are now producing on several levels down to a depth of about 1,300 feet.
This, in connection with the old Findley workings, is now making a handsome distribution of dividends.
Lessees on the Hull City (Independence Cons.) are making a good showing, but there is no evidence that any new productive veins have been found.
The Vindicator mine in 1904 has developed three entirely new ore bodies on several levels and at good depth. Some of the ore-shoots contain telluride streaks richer than were ever known in the property before.
This mine, which has for a number of years maintained a rank among the half-dozen greatest producers in the district, is therefore now enjoying a renewed period of exceptional prosperity.
The Zenobia, of the Stratton Estate, one of the oldest mines on Bull Hill, has come to the front with a regular production, said to be the result of extended developments on the vein which made the earlier shipments.
The final adjustment of all serious litigation against the Stratton Estate has enabled the administrators to offer an immense territory for lease at the beginning of this year. Since much of this is located in the old productive section of Bull Hill, it may be predicted that it will make notable contributions to the production of 1905, and serve as an important factor of prosperity in the immediate future of the district.
The Pharmacist, the first dividend payer in the district, has again revived and is shipping, regularly, ore running from $20 to $30 per ton.
On the west slope of Bull Hill, the Ramona and Silver Tip claims have a somewhat erratic but very interesting ore body, which is furnishing good shipments. It is marked by the same general mineralogical peculiarities that characterized the ore from which such profits were realized in the Wild Horse.
This is supposed to be the same vein as that which created a sensation in 1903 by its production in the War Eagle, lying south of the Ramona.
Developments of importance have been in progress for some time on the Burns, of the Acacia Company, on the summit of Bull Hill. Shipments of considerable aggregate value have already been made and the outlook is very good for 1905.
During 1904, a great amount of money was expended in the development of certain parts of the old Isabella. It is now said on good authority that some of this has shown very satisfactory results, and that this remarkable old property will soon rejoin the producers with its characteristic high-grade ore.
The Last Dollar, which has for a long time maintained a steady output from the vein originally developed in company operations, has been rewarded for its recently adopted policy of leasing its non-producing territory by the development of a large body of payable ore in a vein which, though known for a long time, was not considered sufficiently strong to justify further prospecting.
The Gold Sovereign, at the head of Arequa Gulch, has made regular shipments of good ore in 1904 under lease. These are now being continued under company direction, with good reserves opened up for later extraction.
The Princess Alice, which has shown only intermittent activity for several years, with a reorganization of the company and an aggressive new management, has developed ore hitherto unknown, of exceptional value, and promises to maintain production for a good period.
Raven Hill. - On the summit of Raven Hill, the Joe Dandy, which changed hands in the early winter, has been thoroughly sampled and overhauled by the new owners; as the result of a vigorous policy of development, it has revealed important ore resources from points near the surface to a depth of nearly 600 feet.
Much of this is comparatively low grade and is being locally treated, but in the process of its extraction higher grade streaks are being saved separately, which make a smelting product returning $100 or more per ton.
Fig. 3 shows part of a region of highly interesting new discoveries of 1904, immediately above the town of Anaconda. Of these may be mentioned at least three strictly new bodies of ore in the Anaconda tunnel, just to the west of the picture.
The photograph shows the top workings of the Peggy G. M. Company; also the Sharp lease on the Colorado Boss of the Cripple Creek Cons, and the Morning Glory of the Work Company, both of which have been eminently successful.
The area shown in the photograph is in the immediate vicinity of the Mary McKinney mine, which is making a fine record from its lower levels, and the Doctor Jack-Pot, from which lessees are shipping a fair tonnage of first-class grade.
The Rose Maud, located between the last mentioned mines, has been on the producing list the past year and promises to continue shipments for some time to come.
It is a source of general satisfaction in the district to see the Elkton again producing, paying dividends, and in a generally prosperous condition. Its deep levels, once flooded with an unmanageable volume of water, have been relieved quite effectively by the El Paso drainage tunnel, and under recent development show bodies of ore first class in both size and grade.
The Thompson claim, in the southern territory of the group, operated under lease last year, found important new ore on flat north-dipping veins which intersect the main north and south vein of the property.
These, since the expiration of the lease, have been making a fine profit under company direction.
The Elkton Company owns a large territory, particularly to the west of its main workings and northward in the Tornado region, which has never been duly prospected. Much is to be anticipated from the present rejuvenation of the company.
Rose-Bud Hill. - This section of the district has never been distinguished by a great amount of attention in prospecting. It is credibly reported that a lease in the territory of the Gold Bond Company has found good ore and is at this time putting itself into shipping condition.
Gold Hill. - The Conundrum of the Anchoria Leland Company continues to make profits in spite of the particularly troublesome gases of the deeper levels. Several leases on the summit of Gold Hill began shipping in the latter part of the year, though information is not at hand as to the extent and value of their discoveries.
Globe Hill. - The Lady Stith, of the Stratton Estate, worked under lease, shows a remarkable body of medium grade, which is making a steady and gratifying profit. The development of this large ore body in a region poorly prospected was an event of 1904.
The C. O. D., at the head of Poverty Gulch, one of the shippers of early days, has been operated by an aggressive leasing company, which has made a resolute fight against the deadly flow of carbon dioxide and nitrogen gas, which is a most serious handicap to deep mining in that vicinity.
A high-grade vein has been opened and a good tonnage of ore will be marketed when connections are made with the adjoining Gold King to relieve the difficulty of "bad air."
In the last mentioned property, a new vein has been found by cross-cutting, which is destined, it is said, to make a good showing the coming year.
Battle Mountain. - There is always something of import in the wonderful territory of the Portland Company. This mine, with its record of about $20,000,000 gross production, is and will long remain the greatest mine in Colorado, not only because of the remarkable productiveness of its separate veins, but also because of their great number and the valuable and extensive territory of the company.
The policy of keeping in constant progress a plan of expanding development into new ground has been the means of keeping the mine always in ore. It has been in a steadily improving condition in this respect for three years.
The past year has shown the usual quota of discoveries in new territory, and the last quarterly dividend of 10 cents per share should be evidence sufficient of its prosperous condition.
Stratton's Independence terminated company operations after doing thorough drifting and cross-cutting at 1,150 and 1,400 feet, and demonstrating the absence of ore in the veins which had been productive in levels above.
The old workings were leased by blocks and levels. Excepting an apparently important discovery in the granite south of the main workings, lessees have made their output from remnants of ore left by the company in the breasts at various points, though some has been found by prospecting in the walls of slopes.
All together, this work has shown somewhat startling results, but, of course, can not continue on the present scale indefinitely. It has been a case, mostly, of the concentration of close methods of mining upon the many narrow streaks left standing in stopes and drifts, some of which were high grade, but required, nevertheless, the eternal vigilance of the lessee to mine them as free as possible from waste and at the same time cheaply and rapidly, with as little expenditure as possible for timbering.
A comparison with the last period of company operation is manifestly unfair, since the company was doubly handicapped by the excessive expense account in non-productive deep development and the extraordinary cost of heavy pumping.
However, the supremacy of the leaser's methods over company operation may be demonstrated, if, after something like a year's trial and the exhaustion of the ore reserve known to exist at the time leases were granted, sufficient new reserve has been established to maintain for another year anything like the output of 1904.
In the Gold Coin nothing strictly new has been discovered. The development of the ore shoot in the main vein system on the deep levels has been the chief means of maintaining a good production for the year.
The depth of rich telluride ores in this mine makes the outlook for deep ores in the large fissures along the volcanic rim in this southeastern edge of the district most satisfactory, always excepting Stratton's Independence, where deep ore deposition has been controlled by special and local geological conditions.
The Granite mine, between the Portland and Gold Coin, has again entered the shipping list with an ore body apparently new.
THE LEASING SYSTEM
Probably the most interesting factor in the renewed vigor of mining, new discovery and increased production, has been the general adoption of the plan of leasing in territory which is not being worked by the mine owners.
There is no question of the wisdom of leasing from the point of view of the owner. It is always beneficial to him, but to the lessee only under the most favorable conditions. Nevertheless, lessees are eager to try their chances on unprospected territory.
Though they often pursue the rosy delusion of some fanciful theory of ore deposits or the foolish vagaries of clairvoyance and the divining rod, and therefore frequently fail in their quests, nevertheless, the dauntless prospector has sometimes succeeded in finding rare treasure in ground which had been scorned and neglected by the management of great mining corporations.
The leasing system has been successful in two separate respects:
(1) In making a profit from ground partly exhausted and abandoned in company operations as incapable of rendering a profit sufficiently sure.
(2) In the discovery of unknown ore in ground regarded by company management as unpromising and therefore not warranting expenditure in its exploitation.
Mine operators often have the feeling that there must be something radically wrong in their methods when a company may fail, either by lack of foresight and judgment or by its system of operation, to earn profits from ground in which a lessee, even with the payment of high royalties, finds a fortune.
As to the matter of ore discovery on undeveloped tracts in Cripple Creek, the mine manager need find no cause of self-accusation. Discoveries by the prospector are more often accidental in such places than otherwise. Cripple Creek veins do not outcrop, nor in most cases are there any guides to ore in the way of float, or any other superficial indications.
Ore is found in such cases as the W. P. H., not by following up anything which shows unmistakable evidence of connection with ore shoots, but by the plan of sinking a shaft to a reasonable depth, cross-cutting the entire tract with some degree of thoroughness, then following in drifts anything in the way of vein or seam which shows the best definition and the best values.
Such work has been discouraging and often unsuccessful, as is shown in this same vicinity, and has probably achieved success much more tardily and at greater expense than would have been the case with company work in the same ground.
The claims immediately adjoining the W. P. H. have been riddled by prospective workings, lessees one after another undertaking the task of development and many of them returning to "day's pay" among the miners of the district, with little to show for the outlay of their small accumulation of money except a series of profitless shafts and cross-cuts.
Some of these older workings, at the time the last fortunate lessees made their discovery, had reached points very near the bonanza.
Cripple Creek is not a district of long, but of rich ore shoots. They are not easy to locate, but they produce fortunes when they are found. They are not great quartz lodes everywhere containing some ore, but sharply localized shoots into which a miner may drift by following the merest seam.
Why do lessees make better profits sometimes on developed blocks of ground than can a company?
(1) In the rush of centralized company operations, it seems to have been impossible to keep a proper record of all the points at which ore shoots have not been opened, but at which superintendents would certainly pursue developments if more conspicuously necessary work did not detract attention until the promising but undeveloped vein has been forgotten. Lessees have found ore in many cases in such forgotten veins.
(2) The lessee's work is cheaper, when he is actually in ore, than company operations. He does not carry the burden of a great amount of development at other points, but expense is confined to removing his own ore. The public knows only of his shipments and the apparently larger profit than that which the company has made from similar territory in the mine.
The average net profit from mining in the district under company operations may not exceed 25 per cent., yet sometimes the lessee is able to pay a royalty equal to this, or even as high as 50 per cent., and still record great profits for himself.
Only the successes in leasing are reported. The essential secret of the apparent anomaly is that a lease, to make a profit, must find ore of much higher grade than the average company shipments; else, with the payment of royalty, the enterprise becomes a failure.
One real feature of improvement in lease methods over company work, aside from usually watching in closer detail matters of current expenditure, is the stricter superintendence over labor. There is no question but that the lessee gets much better average results from a miner's shift of work than can a company superintendent.
The general lesson, however, to be learned from the past year's lease work in the camp takes the form of a rebuke to timid mining; not that money should be squandered recklessly and aimlessly in all new territory, but no new ground in a mine within the producing area can be so unpromising as not to merit some systematic development, nor any well-marked vein so hopeless that it does not deserve at least one good long drift at some depth within the horizon of best mineralization in the mine.
In the best sections of the camp, the veins are sometimes closely spaced, forming systems or networks such as are probably not duplicated in any other mining district in the world. This fact greatly enhances the chances of finding ore even by the blindest and most unsystematic methods of prospecting.
On the other hand, great wealth may lie in such restricted limits that the most thorough development by cross-cuts may miss it.
Two or three cyanide plants have been operating in 1904 upon bodies of low-grade oxidized ore. Up to the present, no assured results of any considerable magnitude have been accomplished along this line of experiment, so far as it is possible to ascertain.
It is still a question whether sufficient tonnage of the necessary character is available to admit of the pursuit of such enterprises on the somewhat extensive scale indispensable to any notable profits.
The problem of treating cheaply the unoxidized refractory ores is receiving much investigation in the chlorination mills. The next important step should be in this direction.
An effective influence in normalizing and rationalizing the industry in the district will be the final report of Messrs. Lindgren and Ransome, who have completed the field investigation in connection with the geological re-survey of the region.
A preliminary Report of Progress, recently issued as Bulletin 254 of the U. S. Geological Survey, aims to express only certain general facts of immediate interest, such as:
(1) The established limits of the best mining area of the district, which will be a safeguard to incoming capital.
(2) A brief classification of the veins on the basis of simple distinctions of structure and mineralogical character.
(3) The general conclusion as to the absence of secondary telluride and sulphide enrichment in the veins, which will, at least, by the statement of its premises, serve to dissipate erroneous conceptions of the commercial significance of the contrary theory.
(4) A general description of underground water conditions.
(5) And a discussion of the limitations of ore shoots and certain deductions bearing upon the prospects for payable ore at great depth.
On the last mentioned topic, no doubt, much more will be said in the final volume now in preparation.
The wealth-producing capacity of the Cripple Creek hills has been pre-eminently great in the past. The review of the last year's progress inspires the belief that the district may continue to be just as productive for many years to come.
The prophecy of Bulletin 254 that it may now steadily decline, was made at a time when mere statistics justified the statement. Since the beginning of the new year, however, conditions have so changed as to contradict this inference.
At the present time, the stream of wealth flowing from the district is as great as ever before in its history, and it is possible that the output has not yet reached its zenith.