The miner’s refrain
Grass Valley contemplates the return of large-scale gold mining—inside the city limits. But critics say the project is only fool’s gold.
The pasty, essentially meat, potatoes and onions wrapped in pie crust, is a relic of gold mining’s heyday. Back then it offered cheap, portable sustenance for the Cornish miners who worked underground, but also more dignity than today’s convenience-store burrito.
At Cousin Jack Pasties, owner Arlene Rice cranks them out for locals and tourists who visit her downtown Grass Valley restaurant. The pasty holds stature alongside pickaxes and donkey-pulled ore carts as mining icons, and Rice said most of her customers wind up talking about the industry that developed this area and so much of California.
So, she thinks it’s fine that a company would want to reopen the long-shuttered Idaho-Maryland Mine, which sits about a mile from her shop. It closed 49 years ago but remains the state’s No. 2 underground gold producer. The mine company also promises 400 new jobs and an environmentally clean operation.
“Having it return would be a plus for the area,” said Rice, who was born and raised in the heart of the Mother Lode. “There’s going to be a few people that are going to make a scene about it, but that’s far-out.”
Gold mining’s past isn’t all shiny, however, and this part of the Sierra Nevada foothills has seen streams and groundwater poisoned with arsenic and mercury, and residential wells drained of water by mining mishaps underground. The Empire Mine, the state’s No. 1 underground mine and now a popular state historic park in Grass Valley, still has contaminated areas that are blocked off from the public. The Lava Cap Mine, a short drive from town, is a federal Superfund cleanup site.
Also, Grass Valley, population 13,000, isn’t the same town it was in 1956, when the mine closed. The area is now surrounded by high-tech industry, a business park, a hospital and the four-lane Golden Center Freeway.
“It’s become much more sophisticated than it was during those days, meaning a lot of different cultures have come in and changed how business is being done,” said Mayor Gerard Tassone, who as a kid played in the area’s abandoned mine tunnels.
If Emgold Mining Corp., a Canadian junior mining firm based in Vancouver, gets its way, the Idaho-Maryland would open in 2007, become the state’s only mine within a city’s border and operate for about 20 years. It also would be the state’s only industrial-sized mine in operation. Plans, now going through a city-led review process, call for pumping millions of gallons of water into a nearby creek to clear miles of underground tunnels and digging up thousands of tons of ore that would be hauled to the surface. Up to four tons of ore would be processed to yield a single ounce of the yellow metal.
“All to produce gold to be used for jewelry for people in India,” said Don Rivenes, an official with the local Audubon Society chapter.
Rivenes and others have environmental concerns, but the project also has sparked debate on how best to use the land. Much of the property is zoned residential and sits next to a string of apartment complexes, said Dean Williams, a city-council member who would like to see a mix of housing, retail and office space at the site. He recently voted alone against hiring consultants to handle the review process because he thinks zoning changes should be considered first. “Basically, the strategy is anti-sprawl,” he said. “It’s the perfect spot for higher-density housing.”
Emgold insists the property remains an ideal spot for mining. It’s a proven producer that still holds at least 1.5 million ounces of gold, project manager Ross Guenther said. That kind of bounty can’t be matched by what Silicon Valley spinoffs have brought to the area, he said. “Computer industries, these can be outsourced, but mining cannot be outsourced. Minerals are where you find them.”
Steve Enos is a former city-council member who now works as a land-use and environmental planner. In the 1950s, he said, when the mines closed, Grass Valley slumped under the loss of mining jobs and all the spinoff employment. It eventually rebounded when high-tech businesses moved into the area, drawn by what some locals call “pine tree compensation,” and tourism helped diversify the workforce.
“Mining is not a sustainable endeavor—period,” Enos said. “And what happens to the economy the day the mine closes?”
He and others also question whether Emgold can pull off the job. The company dropped similar plans in the mid-1990s, after the price of gold dropped below $300 an ounce—compared with current prices around $500. Also, Emgold as a company has yet to take a mine into operation.
“It’s a penny stock. It doesn’t have anything except a hope and a twinkle in the promoter’s eye,” said John Woods, a Vancouver-based journalist who tracks the Canadian mining industry on his Web site, Stockwatch (www.stockwatch.com). “A penny stock has to have a story—it has to have something to tell potential investors—and mining works well,” he added.
What’s to stop the mine from folding up if gold prices drop again?
Guenther said the company can ride out fluctuating gold prices by converting mine tailings into profit-making ceramic products with a patented technology he developed in his garage. Basically, a machine he calls a hot-vacuum extruder would heat the tailings until they melted, allowing them to be made into floor tiles and other products. The process—which is untested on a commercial scale—is supposed to provide half of the project’s estimated 400 jobs. He also said this process would answer the biggest environmental concern at most mines: how to handle the tailings that sometimes form sulfuric acid and seep into groundwater and streams.
“We’re using the whole buffalo, so to speak,” Guenther said.
Emgold touts the technology as more energy-efficient than other ceramics processes. Yet, the company estimates it would need to burn 2.1 billion cubic feet of natural gas a year, enough to supply 25,000 to 50,000 homes, based on Pacific Gas & Electric figures.
“Energy is a big cost” in the production of ceramics, said Bob Hurt, who works for Dal-Tile, the country’s largest tile manufacturer, as the Dallas-based company’s director of environmental health and safety. “The cost for natural gas has almost tripled in the last three years, and it’s not getting any better.”
Gas-consumption issues worry Mayor Tassone. “I don’t think we have an unlimited supply of resources,” he said. “Does it really make a business viable if they’re using so much energy to make a product?”
Mining also goes through a lot of water. During the company’s last go-around in the 1990s, neighbors organized and sought assurances that they would get backup water service if somehow their wells were drained during the mine’s dewatering phase. Emgold plans to drain the tunnels to deeper than 3,000 feet below ground, yet the wells sit much higher, and hydrogeologists say the underground rock structures make it hard to know if siphoning would occur.
One of those neighbors with a well, Eric Gibbons, helped get Emgold to promise that it would provide water-service hookups if trouble occurred. He remains open-minded about the company’s latest plans. He also understands the importance of gold’s history and likes the idea of Grass Valley landing more jobs. But looking beyond the nostalgia, he worries about 24-hour traffic, dust and noise.
“Some people say the mine was here first, but I’m sorry, the mine hasn’t been here for 50 years,” he said. “I didn’t buy next to an operating mine. I bought next to a vacant lot.”