USA > Colorado > History of Nevada, Colorado, and Wyoming, 1540-1888 > Part 15
USA > Nevada > History of Nevada, Colorado, and Wyoming, 1540-1888 > Part 15
USA > Wyoming > History of Nevada, Colorado, and Wyoming, 1540-1888 > Part 15
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ing 400 feet, divided into 16,000 shares, began operations in 1861 or 1862. It was down about 2,200 feet in 1875. The assessments levied amounted to $1,770,009, and the dividends to $1,598,000. Chollar-Potosí, covering 1,400 feet on the Comstock, was divided into 28,000 shares. Its assessments pre- vious to 1876 were $1,022,000, and its dividends $3,080,000. Yellow Jacket, with 957 feet divided into 24,000 shares, assessed the holders $2,358,000, and paid in dividends, $2,184,000, in the same period. Crown Point, having 540 feet on the Comstock, was divided into 100,000 shares. It assessed $673,370, and paid $11,588,000 in dividends. This mine had an unusual bonanza. In 1870 it was apparently exhausted, when the largest ore-body ever found, up to that time on the Comstock lode was discovered. In 2 years it yielded $9,944,783,57, and continued to yield largely for several years, Belcher, in-
133
ANNUAL PRODUCTION.
pending them in much the same manner. The aggre- gate production of the mines on the Comstock during the first twelve years has been estimated at $145,100- 000, which would be at the average rate of about $12,100,000 annually, though the production varied after 1861 from two to seventeen millions. In 1873 the production suddenly rose to more than double the amount ever obtained in one year, or to $35,254,507, which productiveness was increased for several suc- cessive years. The immediate cause of this advance was the discovery of the "great bonanza," whose brief and brilliant history was the wonder of the world.
There was a group of mines lying south of the Ophir, known as the Central, California, Central No. 2, Kinney, White and Murphy, and the Sides, which covered together over thirteen hundred feet.18 In the
cluding Segregated Belcher, covered 1,040 feet of the lode, divided into 104,000 shares. It was one of the deep mines, being dowu 1,900 feet. Total assess- ment in 1875, $660,400; dividends $15,085,200. Overman, adjoining the Segregated Belcher, was located in the autumn of 1859 by John Overman, an immigrant from Iudiana. He ran a tunnel in the side of the hill for a pros- pect, and sold his claim for $5,000. The mine, like so many others, was in litigation. and cost its owner a much larger sum. It was 1,200 feet in ex- tent, and had paid no dividends in 1876, though it had assessed to the amount of $1,876,680. Imperial-Empire had a depth of 2,000 feet, assessed its share- holders $1,670,000, and paid in dividends $1,067,500. Sierra Nevada, owning 3,300 feet at the north end of the Comstock, was down 2 000 feet in 1875, and had made 42 assessments previous to 1876. It has since reached 650 feet lower without reaching a bonanza. Bullion, over 1,400 feet down, Calc- donia 1,076 feet down, Andes, Arizona, and Utah, Alpha, American Flat, Baltimore Consolidated, Bacon, Best and Belcher, Confidence, Gold Hill Quartz, Challenge, Crown Point Ravine, Dardanelles, Eclipse, Empire Mill, Exchequer, Globe, Julia, Justice, Kentuck, Knickerbocker, Kossuth, Lady Washington, Leo, Mexican, New York Consolidated, Rock Island, Silver Hill, Succor, French, Union Consolidated, Utah, Whitman, and Woodville had all their place on the lists of the stock exchanges in 1875, and had ex- pended more or less large sums in development. Powell's Land of Silver, 101-20.
18 The history of these claims is given in Wells' Book of Deeds, MS., 3-4, thus: ' All the ground, from the south line of the Ophir down to the south line of the White claim, was taken up and located by various claimants, with the exception of 110 feet of ground lying between the south line of Bishop & Camp's ground and the north line of White & Co.'s 100-feet location. This piece of vacant ground was taken up by John Murphy and Lee James, who filed a notice of location calling for 600-feet; . . . but when they came to take possession they found that Bishop & Camp were in possession of 150 feet ad- joining James Cory's line on the south. . .. The White location was an older location . . 110 feet south of Bishop & Camp.' In July 1859 a settlement of
134
FURTHER DEVELOPMENTS ON THE COMSTOCK.
days of the Ophir excitement, the owners held the ground at prices higher than would-be purchasers offered, and the companies undertook the develop- ment, which proceeded slowly, and without any en- couraging discoveries. A shaft had been sunk on the Central to a depth of over 600 feet, and several tun- nels driven in, intersecting the shaft at depths of from 300 to 600 feet, two of which were costly and extensive, but which failed of their purpose, nothing being found exeept some small bunches of rich ore in the California. So persistent was this barrenness of the lode over so great a space that the fact at length attracted the attention of those who were versed in the geological features of the district.
In June 1867 four of the six companies-Central No, 2, Kinney, White and Murphy, and Sides- com- bined under the incorporated title of the Virginia Consolidated Mining company, but without attempt- ing any signal exploitation for two years longer. In 1869 they expended $161,349.41 without discovering an ore deposit of any value, their power to assess was exhausted, and the whole mine worth, at the price their stock was bringing in the board, but $18,850. The most discouraging feature of their enterprise, in the minds of the owners of the Virginia Consolidated, was that the Ophir bonanza had failed at about the depth of their latest explorations, and that the Gould and Curry had also given out 1,000 feet below the surface-coincidences which seemed to fix the depth to which they might go for rich ore bodies. At this juncture the mining firm of James G. Fair, John W. Mackay, James C. Flood, and William S. O'Brien made an offer of $80,000 for the property of the Con- solidated Virginia, which was transferred to them,
boundaries was agreed upon. Joseph Webb was allowed 50 feet on the north part of Bishop & Camp's ground; White, Hammack, & Kirby 100 feet lying to the south, James & Murphy 110 feet between the White and Webb ground, and John D. Winters and Sides & Co., got something over 300 feet on the south. This settlement was never disturbed, and was the basis of the title purchased by the bonanza firm.
135
THE BONANZA FIRM.
and soon after also a controlling interest in the Cali- fornia mine. 19
The mining experience of Fair and Mackay, with their knowledge of the leading features of the Com- stock, justified the venture which they had under- taken as much as any unknown undertaking is ever
19 The history of John W. Mackay is that of a favorite of fortune. He was born in Dublin, Ireland, Nov. 29, 1831, and there received his education. In 1850 he migrated to the United States with aspirations after a wider field of action than was afforded him in his ancestral island. For a year or two he was employed by a commercial house, but hearing much of the land of prom- ise on the shore of the Paeifie, bade farewell to steady-going Boston, and joined the army of gold-seekers, landing at San Francisco, and going to work in the mines near Downieville, in Sierra county, Cal. As a placer-miner he made small advance towards the coveted fortune, but being young, and hav- ing some claims to manly beauty, he employed a part of his time paying court to a daughter of Daniel E. Hungerford, to whom he was afterward married, and who has become known to all the world as a woman of rare social quali- ties, and benevolence of character. When the Comstock lode was discovered Mackay, along with the rest of the mining world, hastened to Washoe, where he worked at first as a common miner, but saving his money and watching his chance for an investment. He purchased an interest in the Kentuck minc at Gold Hill, and patiently worked a few years more, during which he acquired a valuable knowledge of the great lode. In 1869 he joined James G. Fair in a contract to develop the Hale & Noreross mine, which from pay- ing dividends had fallen off to requiring heavy assessments. Mackay and Fair believed the mine could be made to pay largely again, and formned with Flood and O'Brien of San Francisco the company which finally secured con- trol of a bonanza. From this period Mackay has enjoyed unparalleled financial prosperity. His family has resided in Paris, where Americans of distinetion have been royally entertained by them, and his daughter has been married to a prince of the Italian house of Colonna. Many are the deserv- ing persons and charitable enterprises which have received aid from the in- telligent application of the wealth acquired by this member of the bonanza firm.
James G. Fair was a native of Clougher, County Tyrone, Ireland, born Dec. 3, 1831. He came to the United States with his parents at the age of 12 years, residing for 6 years in Ill., and joining the Argonauts in California in 1849. His first mining was done on Feather river, but having a tendeney toward quartz, he was led to study this branch of mining, his intelligence in his regard coupled with this extensive knowledge of mechanics, placed him in the position of superintendent and manager of extensive mines in Califor- nia, and finally of the Ophir and Hale & Norcross. While at the latter mine he proposed to Mackay, Flood & O'Brien to form a partnership for the con- trol of mining property. The Hale & Norcross gave the firin its first start on the road to wealth. Fair was a man of a striking personal appearance, and a bright, aetive mind, and probably originated some of the most successful moves of the bonanza firm. His further history belongs to politics.
James C. Flood and William S. O'Brien were engaged in retailing liquors in a saloon patronized by mine operators, and having gained some useful in- formation, made capital in stock operations. To thesc men Mackay and Fair, with a full knowledge of their capabilities, applied for aid in taking the contract for the development of Hale & Norcross. O'Brien was another Irishman, and Flood was a native of New York. Neither of these men pos- sessed any other talent than inoncy. J. M. Walker was a member of the firm at the beginning, but soon sold out to Mackay.
136
FURTHER DEVELOPMENTS ON THE COMSTOCK.
justifiable. A drift from the 1,200-foot level of the Gould and Curry was continued through Best and Belcher into Consolidated Virginia in 1872. At the same time the shaft already begun was deepened, and a drift run from a depth of 500 feet, east and west, improvements made in the hoisting-works, and the shaft deepened. During all these operations the search for an ore deposit different from the low-grade ore found in drifting, and more continuous than the bunches sometimes encountered, was being prosecuted by the untiring manager Fair, who was following up in the lower drift a thin seam of ore, from day to day, of which he never lost sight, although it sometimes narrowed to a mere film. There had been expended thus far $200,000, and the miners began to think it was borrasca in the Consolidated Virginia for the new proprietors as well as the old.
In March 1873 a fifteen-foot stratum of ore, milling $34 to the ton, was reached in the drift, about eighty feet north of the south line of the Best and Belcher. The size and richness of the ore increased throughout the year, the deposit spreading out like a wedge with its apex at the top, until it showed a width of between 300 and 400 feet. The shaft was carried down to establish its extent in a vertical direction. A number of mills were employed on the ore, and the monthly shipments of bullion from the Consolidated Virginia reached in a short time a quarter of a million of dol- lars. The shares of the company went up from $40 to $400 before the close of the year; the capital stock having been increased from $7,080,000 divided into 23,600 shares, to $10,800,000 represented by 108,000 shares.
In December the California company was organ- ized by consent of the management of the Consoli- dated Virginia, which conveyed to them the ground, and took a controlling interest in their stock. The new arrangement gave the latter company 710 linear feet, covering the Sides and White and Murphy
137
STOCK VALUES.
ground, while the California company received the Central, California, Central No. 2, and Kinney claims, comprising 600 feet between the Consolidated Vir- ginia and the Ophir-between two bonanzas-the amount of capital stock and value of the shares being made to correspond to those of the Consolidated Vir- ginia.
Notwithstanding that a rich ore-body, constantly growing richer, had been found extending downward from a depth of 1,167 feet, where it was first en- countered, to 1,300 feet, yet with working expenses, costly buildings, and stock manipulating, the shares were bringing in the market in January 1874 but $85. They increased to $110 in October, and in mid- winter, when still richer ore had been found on the 1,500-foot level, to $580, the Consolidated Virginia carrying the California along with it in the market.
This enormous advance, though largely speculative, had a known wealth to justify it greater than the his- tory of mining since the beginning of time could equal, and a suppostitious wealth dazzling to the im- agination, which led stock-buyers to believe their shares might yet be worth $1,000. In January 1875 they did indeed reach $700. California shares, which were considered as essentially the same, went to $780, making the market value of these two mincs together $159,840,000. A careful inspection of the ore in sight by the director of the mint caused him to declare that it should produce $300,000,000. Practical miners saw in the two mines $1,500,000,000.20 The actual product of the Consolidated Virginia and Cal- ifornia mines for five years was $104,460,713.69. From 1878 to 1882 they produced together only $7,971,202.05, and were assessing instead of paying dividends in 1881. The Consolidated Virginia con- tinued to pay dividends down to 1880, paying $540,-
20 U. S. Mint Director, Rept, 1875, 81-3. This estimate was based on the theory that the ore-body was oval or lenticular in shape and that its greatest zone of expansion had not been reached. Powell's Land of Silver, 94.
138
FURTHER DEVELOPMENTS ON THE COMSTOCK.
000 in that year. California paid the last dividend in the year 1879.21
It is plain that rich as was the great bonanza it had reached a ruinous point of inflation in 1875, for even if the actual value of the shares had been equal to the price put upon them in the stock-market they did not represent available capital to that amount. The bonanza mines had carried up the other mines on the Comstock, and few in the whirl of excitement cared to inquire whether or not their stock was of any intrinsic worth. To-day they bought for a rise to sell to-morrow, and everybody turned stock speculator. But this could not last long. Rumor began to whis- per that the bonanza mines were not what some said they were; the fever of hope was succeeded by the rigors of fear, and panic ensued. People were as anx- ious to sell as they had been impatient to buy. The decline was rapid. Consolidated Virginia fell $200 a share within a week. California fell off more than two-thirds of its late market price. Other stocks
21 The following tables show the amount of ore and bullion taken from the Consolidated Virginia and California mines during their bonanza period:
CONSOLIDATED VIRGINIA.
Year.
Am'nt Extracted Tons.
Bullion Product.
1873
$ 645,582 17
1874
91,168
4,981,484 05
1875
169,307
16,717,394 76
1876
142,679
16,657,649 47
1877
144,400
13,734,019 07
1878
122,831
7,996,753 11
Total
60,732,882 63
CALIFORNIA.
Year.
Am'nt Extracted Tons.
Bullion Product.
1875
5,124
$ 453,060 46
1876
128,801
13,400,841 40
1877
217,432
18,924,850 27
1878
134, 888
10,949,078 93
Total
$43,727,831 06
139
SPECULATION AND DISASTER.
fell from 50 to 250 per cent; and while a few per- sons had profited by the excitement, many had been ruined, even some of those whose judgment in mining matters should have been trustworthy.22
" Who is to blame ?" the victims cried. The bo- nanza-owners were accused of speculating in their own shares, of causing declines in order to buy in, and creating a "boom" in which to sell. Vox populi is not always vox Dei. The voice of the people is sometimes the voice of the devil. The bonanza firm became immensely wealthy, and were regarded with more or less envy and suspicion by their less fortu- nate fellows. But the fact remains that they paid out $73,170,000 in dividends to shareholders, and that their works at the mines were of the most ex- pensive kind, while the force employed was large and well paid.
The haste with which the great bonanza was ex- tracted was not due altogether to the desire for sud- den riches. The Comstock lode was not one regular vein of hard quartz, with walls nearly equi-distant throughout its whole extent, but was swollen with ore-bodies of great richness at irregular intervals, and strung with smaller branches more uniformly, yet having some barren rock in places. Wherever the ore occurred there were masses of a percolating clay and crumbling feldspar, which, by swelling, flowing, shifting, and breaking down, constantly endangered the mine. It was to support the roof and walls of drifts, and prevent accidents and losses, that the Deidesheimer method of timbering was resorted to; but timbers of any form decay rapidly in the heat and moisture of the mines. The larger the body of ore, the greater the difficulty and expense of keeping it in place. The sooner, therefore, that the ore was removed, the greater the security from danger by caving, or from fire, which might attack so large a
22 Philip Deideshesmer, and a thousand others as intelligent, were brought to bankruptcy.
140
FURTHER DEVELOPMENTS ON THE COMSTOCK.
body of timber with disastrous effect.23 For these reasons, had there been no other, it was deemed the most economical mode of working a bonanza to ex- haust it quickly.
The aggregate yield of all the mines on the Com- stock down to the 1st of January, 1881, was $306,000,- 000 worth of bullion extracted from 7,000,000 tons of ore. There had gone into the mines, besides the un- productive labor, and small means of prospectors and pioneers in mining, and the timber 24 of the country, $62,000,000 in assessments. There had been paid back to shareholders $116,000,000, and the small, incorporated companies had derived profits amounting to about $2,000,000 more=$118,000,000. The differ- ence between the outcome and the costs to the share-
23 Comparatively few accidents happened on the Comstock, but these were serious. On the 7th of April 1869 a fire broke out in the Yellow Jacket, in which 45 men lost their lives. S. F. Bulletin, April 8, 9, 10, 13, 1869; S. F. Call, April 8, 9, and May 1, 5, 1869; Carson Appeal, April 8, 13, 1869. The fire communicated to Crown Point and Kentuck, the rocks in the S00-foot levels being found to be greatly heated 3 years afterward. In Sept. 1873 a second fire and series of explosions took place, by which 6 men lost their lives, and others were injured. On the 24th of May 1874 the hoisting-works of the Succor were destroyed by fire, and 2 men killed. On the 30th of Oct. the Belcher air shaft caught fire, and was burned for a distance of 1,000 feet. It was not completed, but had cost between $30,000 and $40,000. It being necessary for men to descend into the mine to close the drifts leading from the burning shaft, 18 volunteered to go. While engaged in blocking up the mouth of a drift a cave occurred, and a strong draft of air sucked back into the drift, bearing flames upon the naked men, scorching nine of them to death, and burning others. Volunteers took their places until the work of completing the bulkheads was accomplished. In May 18,5, when a new shaft was being constructed, the workmen encountered great masses of rocks still almost at a white heat, or hot enough to set on fire the new timbers. Fires broke out in the abandoned levels of the Consolidated Virginia and California, which could only be extinguished by bulkheading all commu- nicating drifts, and allowing the timbers to smoulder, until from lack of oxygen the fire was smothered. Wright's Big Bonanza. 176-196; Virginia City Territorial Enterprise, May 4, 5, 6, 1SS1; Helena Montana Post, April 30, 1869; Gold Hill News, Nov. 1, 1871; Id., May 12 and Aug. 17, 1874; Id., March 11, 1876; Balch's Mines and Miners, 799-801; Gold Hill News, Oct. 26, 1875.
24 It is estimated that the annual consumption of firewood on the Com- stock was, at the least, 120,000 cords. Browne, Mining Res, ed. 1867, makes the amount 207,320 cords, which is probably too high. The lumber used in building and mining timbers was estimated at 25,000,000 feet (board measure) yearly, including that used for domestic purposes. The cost of this wood in its several shapes was figured by Browne at $S00,000 annually. See also, Land Off. Rept, 1867, 315; Sac. Union, July 24, 1865. See also Simonin, in Revue Deux Mondes, Nov. 1875, 305-312.
141
COST OF METAL.
holders was $56,000,000, spread over twenty years, certainly not a great profit on the investment. But the other $88,000,000, besides enriching a few, had been expended in the payment of labor, and in various enterprises. Too much, it is true, had gone into liti- gation, costly machinery, in many instances almost without value-into miles of mills and hoisting-works whose usefulness in a few years had ceased-the sight of which suggests the query whether the government, which owns the mines, could not have devised some means of economical working which would have pre- served to the people for a greater length of time their benefits. 25
Coequal in interest with the bonanza features of the Comstock lode was the conception and completion of an extensive piece of engineering, known as the Sutro tunnel. The mode of working the mines by shafts, which soon collected bodies of water requiring expensive pumping machinery at an early date, has been referred to. Floods, from tapping water-pockets in Ophir, Belcher, Crown Point, Over- man, Yellow Jacket, and other mines, had frequently caused the suspension of mining, and threatened the lives of the men employed underground. To furnish drainage for the mines, a less expensive means of taking out ores from the lower levels of the deep mines than by hoisting, and better ventilation also, the Sutro tunnel was planned. 26
25 It is the argument of Alexander Del Mar, in his History of the Precious Metals, 265-266, that a dollar's worth of bullion from the Comstock cost five dollars. Del Mar had been director of the Bureau of Statistics of the United States, and was member of the Monetary Commission of 1876, his book being the result of his researches in this direction. If he reckoned in all the money that had been wasted-if money ever is wasted-in stock speculations, he might have made out a case against mining. There is, indeed, a saying, even among Californians, that 'it takes a mine to work a mine.' Undoubt- edly there are greater risks encountered in this business than in almost any other, but perhaps the failures are no more frequent, where much capital is invested, than in other lines of heavy investment. See Review of Com. and Finance, 1876, 11-12, containing tables showing bullion yield from 1859 to 1876 inclusive; also Balch's Mines and Miners, 959-61, 985-990.
26 It should be said that several tunnels had been cut on a level with the heads of the canons, which became useless when the shaft had pierced to a
142
FURTHER DEVELOPMENTS ON THE COMSTOCK.
The author of the scheme was Adolph Sutro, who had a quartz-mill on the Carson river, but was not known as a mining engineer. The Nevada legisla- ture, by an act passed February 4, 1865, incorporated the Sutro Tunnel company, with the exclusive privi- lege, for fifty years, to excavate and construct an adit intersecting the Comstock lode at a depth of 1,600 feet, 8 inches below the mouth of the Savage shaft, sufficiently wide for a double line of railway, and ex- tending fromn a point between Webber and Corral cañons, a distance of over three miles. Besides effect- ing the drainage of all the mines to that level, it would cross-cut several veins in its course, and afford means of transporting the ores to Carson river, where water-power and wood were more cheaply procured than at the mines. The four intervening cañons would afford facilities for sinking shafts to the level of the tunnel, and from these the work could be ex- tended in both directions as well as from Carson val- ley. This was the plan. The incorporators of the tunnel company were Adolph Sutro, William M. Stewart, D. E. Avery, Louis Janin, and H. K. Mitchell, Stewart being president.
In the spring of 1866 Sutro secured contracts from twenty-three of the principal mining companies repre- senting most of the capital on the Comstock,27 binding them to pay to the tunnel company two dollars a ton for ore extracted above the tunnel level after the extension of the tunnel and its lateral drifts to points within their boundaries. The privilege was granted to the mining companies of transport- ing ore, tools, timbers, waste rock, and workmen
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