Get it by Friday, January 26
, Order by 12:00 PM Eastern and choose Expedited Delivery during checkout.
Same Day delivery in Manhattan. Details
A Fortune 500 company as a pioneer of current gold-mining technology
Jack H. Morris details how Newmont Mining revolutionized the gold mining industry and remains today the second largest gold miner in the world. He asserts that Newmont is the link between early gold mining and today’s technology-driven industry. We learn how the company’s founder and several early leaders grew up in gold camps and how, in 1917, the company helped finance South Africa’s largest gold company and later owned famous gold mines in California and Colorado. In the 1960s the company developed the process to capture “invisible gold” from small distributions of the metal in large quantities of rock, thereby opening up the rich gold field at Carlin, Nevada.
Modern gold mining has all the excitement and historic significance of the metal’s colorful past. Instead of panning for ready nuggets, today’s corporate miners must face heavy odds by extracting value from ores containing as little as one-hundredth of an ounce per ton. In often-remote locations, where the capital cost of a new mine can top $2 billion, 250-ton trucks crawl from half mile deep pits and ascend, beetle-like, loaded with ore for extraction of the minute quantities of gold locked inside.
Morris had unique access to company records and the cooperation of more than 80 executives and employees of the firm, but the company exercised no control over content. The author tells a story of discovery and scientific breakthrough; strong-willed, flamboyant leaders like founder Boyce Thompson; corporate raiders such as T. Boone Pickens and Jimmy Goldsmith; shakedowns by the Indonesian government and monumental battles with the French over the richest mine in Peru; and learning to operate in the present environmental regulatory climate. This is a fascinating story of the metal that has ignited passions for centuries and now sells for nearly $1,000 an ounce.
|Publisher:||University of Alabama Press|
|Product dimensions:||6.10(w) x 9.00(h) x 1.30(d)|
About the Author
Jack H. Morris retired as vice president, investor relations, for Newmont Mining Corporation in 2001 after spending seven years with the company. He previously held similar positions with three other Fortune 500 companies, and was a reporter and bureau chief for the Wall Street Journal and political editor of the Commercial Appeal in Memphis, Tennessee. An honors graduate of Lawrence University in Appleton, Wisconsin, he did graduate studies in political science at the University of Wisconsin, Madison, under a Russell Sage Foundation Fellowship. The recipient of numerous professional awards, including the American Political Science Association’s Award for Distinguished Reporting in Public Affairs, he is the author of Inland Steel at 100, the history of Inland Steel Industries. He is past chairman of the Denver Gold Group, the gold industry’s investor relations organization. Morris and his wife, Dianne, live in Belmont, North Carolina.
Read an Excerpt
GOING FOR GOLDThe History of Newmont Mining Corporation
By Jack H. Morris
The University of Alabama PressCopyright © 2010 The University of Alabama Press
All right reserved.
The story of gold mining in North America is told in terms of mass hysteria-the California gold rush of 1848 and 1849 that brought an estimated 90,000 fortune seekers to San Francisco and Sacramento; the Klondike Stampede of 1898 and 1899 that saw thousands more trek by mule train or dogsled into the frozen mountains of the Yukon and Alaska; and the many gold rushes in the years between into the Black Hills of South Dakota, the Colorado Rockies, Idaho, Wyoming, and Montana. Each began with the lucky find of a nugget or abundant gold flakes in a stream bed or alluvial outcropping, followed by wild speculation and an influx of young men determined to beat the odds and strike it rich.
The Carlin discovery was different. It resulted from the intellectual curiosity and meeting of the minds of two people-Newmont geologist and prospector John Livermore and Ralph J. Roberts, a geologist with the U.S. Geological Survey, who had developed a theory of Nevada geology and mineral endowment through years of observation. And once found, the deposit was exploited not by grizzled forty-niners with picks and shovels but by geologists, metallurgists, and mining engineers using the best science, technology, and deep-pocket capital of a multinational mining company.
Both geologists prided themselves on their economic rather than purely academic approach. "I was always more interested in the practical side of geology, actually finding ore bodies," says Livermore, a 1940 graduate in geology from Stanford. "There are many fine geologists who are not very good at prospecting. You have to be good at reading the rocks and seeing the signs, being a good observer. I was also very interested in studying the literature."
Roberts received his undergraduate degree in geology from Yale in 1939 and his doctorate ten years later with a dissertation on orogeny, the formation of mountains, in north-central Nevada. His work showed that mineral deposits in the area were not randomly located but found in structurally controlled zones of deformation. In meetings with fellow geologists Roberts asserted, "You can concentrate prospecting along the mineral belts and save both time and money."
Roberts theorized that gold, in hydrothermal solutions and magma, percolated up from the depths of the earth in the Tertiary period millions of years ago when the earth's crust was undergoing breakup. As mountains formed, oceanic shale and chert were moved into central Nevada by thrust faults and acted as impervious cap rocks, trapping the gold-bearing fluid, which spread into the surrounding rocks below the thrust plates. When erosion wore through this crust, the gold-bearing rocks were exposed.
In June 1961, armed with Roberts's theory, Livermore and fellow geologist J. Alan Coope began a search across the empty high desert of northern Nevada for unusual rocks and surface anomalies that might indicate the presence of gold. In less than six months they had zeroed in on the Carlin deposit. Quite fittingly, the discovery was made in Eureka County. "I guess you could say we were fantastically lucky," Livermore says.
It was luck based on hours of preparation and dog-tired days of walking over the rugged terrain and hauling out backpacks of rock samples found lying on the surface or chipped from outcrops. It was lonely work. Covering 4,180 square miles, nearly the size of the state of Connecticut, Eureka County had a population of only 775 souls in 1960.
Carlin was not the first mine to exploit invisible gold, nor was it the first in which Newmont had an interest. But it was the first discovery specifically targeted at a sub-microscopic, or disseminated, gold deposit. Very fine gold was mined at the Mercur mine just south of Bingham Canyon, Utah, in the 1880s when a fire assay detected traces of gold in the mine's silver ore. In northern Nevada, Gold Acres in Lander County, the Gold Standard mine in Pershing County, and Getchell in Humboldt County (in which Newmont was an early investor) all produced small amounts of disseminated gold in the 1930s and 1940s.
Livermore worked briefly at the Standard in the late 1940s and did field studies at Getchell as part of a summer program at Stanford. He was intrigued by both and wondered how the forty-niners who had trekked past Getchell en route to the California gold rush had missed the signs.
"The original Getchell outcrop was a very large, bold mass of silicified iron-stained material, which usually would catch a prospector's eye," Livermore told the Bancroft Library's Eleanor Swent in an oral history interview. "It was right on a main trail that a lot of prospectors and other people had passed for years, and they would bang off chunks of rock and crush them up and pan them, which was the standard way of prospecting in those days, and they never would get any colors of gold." The gold was so fine it would float out of the pan undetected. Eventually in the 1930s a prospector thought to assay the rock and the mineralization was discovered.
One of those passing the Getchell outcropping-and quite possibly Carlin as well-was Livermore's great-grandfather, fifty-five-year-old Horatio Gates Livermore, who left Boston for San Francisco in search of gold in 1849. But like many of those who participated in that piece of history, he was delayed in Salt Lake City, most likely by heavy snows in the Sierra Nevadas, and didn't arrive in California until the next year. By then the best claims were being worked and Horatio's panning along the American River above Georgetown came to naught. He turned to logging and eventually became a state senator.
John Livermore joined Newmont in 1952, and after several years at the corporate office in New York and assignments around the world, he returned to Nevada in 1960 to evaluate a lead-zinc-silver property at Ruby Hill in Eureka County that Newmont jointly owned with Cyprus and Hecla Mining. When that task ended, he decided to follow up his earlier curiosity about deposits of finely disseminated gold by researching U.S. government documents on local geology. One such paper was the 40th Parallel Survey written in 1876 by Clarence King, who later became the first director of the U.S. Geological Survey. This pioneering effort, which took six years, documented the topography and geology along the transcontinental railway that paralleled the Humboldt River and Emigrant Trail. Reports were also written between 1936 and 1939 by W. O. Vanderburg, a mining engineer with the U.S. Bureau of Mines, who had studied lode and placer gold mines in northern Nevada. Although he stated that "sedimentary gold deposits do not possess easily recognizable indications," Vanderburg concluded that other deposits similar to Getchell, Gold Standard, and Gold Acres remained "to be discovered ... where sedimentary formations, like shale and limestone lying in proximity to acid intrusives, are common."
That was enough to ignite a prospector's interest. "The big question for me was how do you find these deposits? You can't look everywhere," Livermore recalled. It was at this point that Roberts provided the key. Roberts had participated in regional mapping studies of Nevada since 1939. In 1960, he published a two-and-a-half-page professional paper on the alignment of base and precious metal mineral districts in northeastern Nevada and their relationship to major thrust faults, particularly the Roberts Mountain Thrust. The name is a coincidence, the mountains having been named for Bolivar Roberts, superintendent for the Pony Express, which crossed the area in 1860-61.
"By very careful mapping, he had concluded that there was this enormous thrust structure where the rocks had been shoved horizontally about 50 miles to the east in the central part of Nevada," Livermore told Swent. Roberts then plotted known mineral deposits on the map and showed that many occurred near "windows" where older, overthrust rocks had faulted and eroded, exposing younger, mineral-bearing rock below. "That really got me interested, because now I had a model to follow to try to find some of these occurrences," Livermore said.
In the spring of 1961, Roberts gave a talk in Ely, Nevada, which Livermore attended. After several discussions between the two men to hone in on his theory, Livermore persuaded Fred Searls Jr., Newmont's chairman and a noted geologist in his own right, to undertake the search for invisible gold in the Carlin area. Coope, who was in Nevada to investigate possible gold properties near Valmy, was assigned as his assistant.
Newmont in 1961 was still a relatively small investment company with interests in a dozen mining operations, the largest being in southern Africa. An offer late that year to increase its holdings in Arizona's Magma Copper from 21 to 81 percent was accepted in early 1962. Revenue, almost entirely from dividends and security sales, totaled $18 million. Net income, after modest expenses for salaries, exploration, research, and taxes, was $15 million, of which almost half was paid out in dividends. The market value of its stock was $200 million.
Yet, the company's office at 300 Park Avenue in New York was an exhilarating place to work. Plato Malozemoff, who would shape the company's persona for three decades, was CEO and in his seventh year as president. Including Searls, there were only eight officers and a handful of staff. Offices were open and daily discussions ranged over a multitude of issues affecting the company's various holdings. Staffers were expected to be multitasked and reporting responsibilities were vague at best. Livermore, who had worked as a roving geologist on a number of projects that Newmont did not directly own, reported to Searls. Coope reported to Robert Fulton, a workaholic mining engineer, who headed exploration.
Exploration attention in the early 1960s was on base metals, particularly copper. With the cold war and rising demand for electricity, the U.S. Atomic Energy Commission had encouraged Newmont to open a uranium mine in the mid-1950s, but within a few years the outlook for yellowcake had dimmed. Now looking for new ventures, Newmont began to think of applying the techniques of modern copper mines-large-scale open pits mined with huge shovels and trucks-with relatively cheap and highly efficient cyanide gold extraction to western gold properties. Searls had brought Newmont into the Getchell mine and Fulton, like Livermore, had read Roberts's 1960 paper with interest.
Livermore and Coope began their search in deep secrecy, sometimes working at night. But with only one small hotel, two cafés, and two gas stations in the railroad town of Carlin, the two geologists, Livermore a lanky six foot five and Coope very British in dress and speech who drove a blue MG, stood out and questions were asked. People in the larger town of Elko, twenty miles to the east, ridiculed the prospectors. The area had been "prospected for years," they were told. Newmont itself had mounted a short-lived search for lead and silver in Elko County in 1946. Years later Livermore admitted that the secrecy probably wasn't necessary. "We had the whole country to ourselves; no one else was much interested in gold in the early 1960s."
The reason was price and government policy. The gold price had been fixed at $35 an ounce in a Presidential Proclamation by Franklin Roosevelt in 1934. Then in October 1942, the War Production Board issued Order L-208, which halted most gold mining in the United States so that miners and material could be reassigned to more strategic metals. When the war ended and mines sought to reopen, costs had risen above the selling price. Livermore recalls that there were 1,100 gold mines in California alone in 1940. Most were tiny operations. Twenty years later only a handful remained in business.
The Empire-Star mine in Grass Valley, California, which had sustained Newmont during the Depression, closed in 1956. Still, in the early 1960s, Newmont was one of the top ten gold producers in the country with byproduct output from Magma Copper and Idarado, a Colorado lead and zinc mine. Carlin lifted Newmont to second place after Homestake's underground mine in South Dakota.
The focus of Newmont's Carlin exploration was the Lynn district, an empty swath of blowing sagebrush and a few scattered cattle ranches some fifteen to twenty miles north of the town of Carlin. Mining in the area had been limited and not very lucrative. Fred Lynn had opened a placer mine along Lynn Creek, about 1.5 miles from the Carlin discovery, in 1907. He and other placer miners extracted perhaps 10,000 ounces of gold from area creeks over the next fifty years. Livermore and Coope would have encountered the grizzled Hansen brothers, bachelors who lived in separate caves along Maggie Creek and always had a roll-your-own cigarette protruding from their lips and were still panning the creek each spring for a few dollars in gold. The Springers, from Pennsylvania, operated a small oxide copper mine while living in an old railroad boxcar. Bootstrap, an antimony mine, produced some 10,000 ounces of gold in the 1950s before operational difficulties forced its closure. Turquoise had been mined at Blue Star since the 1920s and traces of gold were found in some drill samples in 1960. But efforts by a Salt Lake City investor to mine this with used equipment failed after producing only four 200-ounce doré bars.
Studies of the Blue Star deposit correlated with Roberts's findings. According to Coope, "Upward-migrating hydrothermal fluids had been ponded beneath a low-dipping thrust structure." Over time, gold migrated from the ponds into the surrounding quartz rock where it precipitated into concentrations of fine-grained gold. Unable to acquire the Blue Star property, a systematic prospecting effort was initiated along similar outcroppings a few miles to the south.
"Two things that are associated with gold are pyrite and silica, so we were looking for silicification," Livermore recalls. "The pyrite breaks down on the surface to iron oxide, so you are looking for a rusty color which indicates that there is pyrite at depth. Certain types of color are quite important. We found that the darker browns tend to be more encouraging than the lighter, yellowish browns." Furthermore, they had to be the right kind of rocks, sedimentary rocks, with calcareous siltstone being the most favorable host setting for gold.
Rock samples were sent fifty miles away to Gold Acres in Crescent Valley, where Harry Treweek and his wife, Clemmie, ran the only assay lab in the area in an old shack. The samples showed traces of gold, assaying 0.03 to 0.05 ounce per ton. Sitting one day on his "chair of geology," a large rock where he often ate lunch, Coope noted a friable, spongy brown rock among the silicified limestone and wondered if it had absorbed any gold. An assay, which showed a quarter-ounce gold, proved him right. That gold constitutes less than 0.4 millionths of 1 percent of the earth's crust explains why a geologist can get excited by a rock containing nearly 8 parts per million gold. Livermore quickly invited Searls and Fulton to come out for a look.
Searls, who established Newmont's first exploration staff and had been with the company since 1925, was a tough westerner who spent his days behind his desk in New York and then visited mines on the weekend. Few mines were acquired or deposits developed without the personal oversight of Newmont's aging chairman. As a young geologist, he had a reputation of arriving by train at a mine in the evening, spending several hours underground mapping the work that had been performed since his last visit, preparing a report, and leaving it on the manager's desk before catching the first train out the next morning. Fulton, equally hard-driving, boasted of working seven days a week and was not opposed to calling a staff member at 3 o'clock in the morning if he had an idea to discuss.
Together they arrived at Carlin in late September, looked over the barren land, and reviewed the gold samples. They were not impressed. Livermore wanted to stake the area to give Newmont legal protection if gold in economic amounts was found. Reluctantly, Searls gave in. "OK, John, if you want to stake this, go ahead," Livermore recalls being told. "Besides," Liver more laughs, "he didn't have another assignment for me."
Seventeen 20-acre lode claims were staked in October with the claims filed at the Eureka County courthouse one hundred miles away. The claims covered what would eventually be the main pit of the Carlin mine. A bulldozer was brought in and trenches dug to expose the underlying rocks. An assay in one trench showed 0.20 ounce of gold per ton over an eighty-foot sample. That was the Carlin discovery.
Excerpted from GOING FOR GOLD by Jack H. Morris Copyright © 2010 by The University of Alabama Press. Excerpted by permission.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.
Table of Contents
ContentsList of Illustrations....................vii
7 Desert Gold....................108
8 Black Gold....................120
9 The End of an Era....................130
10 Shareholder Value....................148
11 Going Crazy....................165
14 New Horizons....................206
15 Culture Shock....................233
17 Faith, Hope, and Hedging....................267
19 A Good Neighbor....................303
20 Sustaining Success....................332
Appendix: Officers and Directors....................347