Historic Structures

Bald Mountain Gold Mill, Lead South Dakota

Date added: October 7, 2021 Categories: South Dakota Industrial Mill

Bald Mountain Gold Mill lies approximately four miles west of Lead, in the Black Hills region of South Dakota. Bald Mountain itself is southeast of the mill complex, which is set on the side of a hill, facing north and looking towards the bed of False Bottom Creek. For much of its operating life Bald Mountain mill was the second largest producer in the Black Hills, surpassed only by the Homestake mine. During the period from 1906 until 1959, it grew to be the center of an industrial complex that included numerous mines, transportation facilities and the workers' town of Trojan.

The development of the Bald Mountain mill over a 53 year period was directly linked to the scale of operation and success of the three successive companies that controlled it. The ownership periods of the American Eagle (1906-10), Trojan (1910-28) and Bald Mountain (1928-59) Mining Companies create three periods for study. Other important events in the history of the mill include the beginning of large changes by Trojan (c 1913), the re-opening of and subsequent investment in the mill by the Bald Mountain Company (1934-9), and forced closure of the mill during World War II (1942-45).

The American Eagle Mining Company 1906-1910

The very small amount of information which survives regarding the activities of the American Eagle Company comes from the Trojan Mining Company's records. The American Eagle Mining Company was incorporated on January 6, 1906 by a group of businessmen from Minneapolis and St Paul, with George Code appointed the first president. The company held twelve claims covering 167 acres at the head of False Bottom Creek and a small cyanide mill was constructed to process ores from the company's mines (their number remains unknown) and to take in custom work. In addition to the existing claims an ore body 14' wide was discovered during construction of the mill and an adit was driven into the hillside. The resulting Eagle Mine supplied the mill with ore from this adit entrance, immediately behind its main crude ore bins.

The mill was constructed by J. E. Downs, and completed in 1908 after a delay caused by lumber shortages. During construction the company's mines had gone into production, so ore was sent to the Hildebrandt mill at nearby Blacktail. The mill was run as a 100-ton per day plant but was thought to be "capable of 300-tons per day" by Trojan manager H. S. Vincent. That the mill was not developed to its full capacity may be due to the small scale of the Eagle operation. Although complete evidence is lacking, it is unlikely to have been a very large producer of ore. Far more probable is that the company relied upon custom milling for a significant part of its income. This aspect of the trade was very unreliable, particularly in an area well served with rail links and thick with competitors. Strikes in 1908 and 1909-10 closed down the vast majority of mining activity in the Bald Mountain area and had a disastrous effect on the smaller mining operations. It is quite probable that this situation weakened the Eagle Company, and made it ripe for takeover by the ever-growing Portland Company.

The Trojan Mining Company 1910-1928

The Trojan Mining Company was established in 1911 after the Portland Mining Company merged with the Clinton Mining Company under company president H. W. Seaman. The two organizations operated with joint management prior to this and had purchased the American Eagle Company and its mill during the fall of 1910. The new company held claims covering some 700 acres (Portland alone had over thirty claims). After consolidation of the various companies' interests, Trojan possessed assets of $5,114,117.66.

Portland had first looked at Eagle's mill with a view to developing their own integrated ore processing facility. Transport of ores to custom millers such as the Lundberg, Dorr and Wilson Company and the American Smelting and Refining Company was a highly convenient solution which Portland had been further encouraged to use by the failure of small scale amalgamation and chlorination mill experiments at their Squaw Creek site. However rail costs were increasingly becoming a significant threat to profits and an "in-house" facility was an attractive alternative.

In 1911 P. H. Bertschy, a provider of large scale custom work for the mill and possibly a former client of the Eagle Company, suspended operations, causing production to slump to 100 tons per day. A policy of increasing productivity at the company's own mines was pursued in order to remove the instability caused by the fortunes of such customers. By 1915 the Dakota, Portland and Empire mines (the company's major operations) were together producing 400 tons of ore per day while the mill was being adapted to this level of tonnage.

The custom ore problem was swiftly and successfully addressed. The first year of operation still saw the considerable sum of 11,688 tons being sent to custom mills while the Bald Mountain mill itself only processed 12,748 tons. However, by the end of 1912 the situation had been radically altered with 60,090 tons passing through the mill and only 227 tons sent for custom work. Soon custom shipments were almost totally eliminated apart from small amounts of specialized ores.

Although custom ore exports were reduced, custom imports were accepted and reductions in rail freight charges encouraged the use of the mill as a custom facility. Ores were delivered to a shaft in the Portland mine and transported to the mill from there. Although there are few records as to the amount of custom ore taken in, earnings from this source were $2,624.86 in 1916 and $9,916,561 the following year.

Vincent's intention to increase the mill's capacity was quickly put into effect and the mill was already surpassing the production of the Eagle period when it averaged 180 tons per day in 1912. It had reached about 300 tons per day by 1916. Plans were made in 1912-13 to upgrade the mill to 400 or even 500 tons per day. After significant modifications, 400 tons per day was achieved in 1917.

In addition to increasing capacity, alterations were made to the mill so that it could retrieve gold and silver in larger amounts from finely crushed ore (slime) as well as more coarse material (sand). In 1912, 35,612 tons of sand were processed but only 24,915 tons of slime. The sliming operation developed quickly, and in 1915 slime was in the majority with 41,341 tons passing through the mill compared to 38,088 tons of sand. Further improvements in sliming facilities had brought the ratio to 55,709 tons of slime compared to a mere 32,220 of sand by 1922. The faster sliming process also increased the volume of material processed. From a total tonnage of 60,527 in 1912, production was to rise steadily until 1916 when 112,837 tons were milled. The 100,000 tons plus level was then maintained steadily for several years.

During this period ore was supplied by Trojan mines such as Eagle, Empire, Portland and Decorah mine. A system of motor-wound cable hoists was constructed to pull the mine cars up and down surface underground inclines. Cars from the Empire mine descended a 1200-foot, 20% slope from the mine entrance by the Chicago and North Western Railroad while the Portland tunnel, which served a variety of Trojan properties in the Annie Creek area, discharged cars down a 2100-foot, 15% incline. Gasoline locomotives were used to bring the cars to the mill tramway which led directly to the mill's ore bins. A variety of ancillary facilities were constructed at the mill while the workers' town of Portland (renamed Trojan) received several new houses and a hotel was planned.

From 1916 to 1920 the Trojan Company expanded considerably. The Decorah and Republic mines were leased, then later purchased, and the Ofer Mining Company and the Two Johns mine were purchased as well. Ore from the Republic, situated in Blacktail Gulch, was brought to the railway in Deadwood Gulch by motor truck while Decorah was connected to the mill tramway system. Due to rich ore deposits, Trojan became the second largest producer in South Dakota during 1917, despite only being responsible for 6% of the total ore output. Gold production peaked in the following year with 23,850 ounces.

While the efficiency of recovery was maintained, the expense of running the mill increased steadily. From an annual figure of $77,479 in 1914, the cost of operating the mill climbed to $107,447 in 1916 and $147,484 in 1918. Although the mill was not forced to suspend operations during the First World War, a serious labor shortage ensued, pushing up costs both at mines and mill. Work was suspended in the Republic mine and although some custom ore was handled, tonnage at the mill declined by 5,748 tons in 1918. Despite the massive advances that had been made in the pre-war years at the mill, Trojan was unable to recover after the war. An inability to repay loans to the First National Banks of Lead and Deadwood led to the banks entering into part ownership of the company. By 1922 annual tonnage milled slumped to 87,929, and in 1924 the records declare "no tonnage mined or milled." The initial decision to suspend production in February 1923 was blamed on bad weather conditions and an announcement about re-opening in 1924 was expected but never came. Manager C. E. Dawson tried to raise funds to save the company but it finally went into receivership in 1926.

There are insufficient surviving records to explain quite why the Trojan Company was unable to rescue itself from collapse but clearly government regulation of gold prices and the shortage of labor were both factors. As far as the mill is concerned, it is clear that despite the improvements it never operated at full capacity. An estimated yearly capacity of 182,500 tons in 1917 significantly exceeded the actual 112,837 tons in that peak year of milling. Despite these shortcomings, the Trojan Mining Company processed 1,144,000 tons of ore during its operating life, valued at $4,170,991. From 1918 to 1923 it was the second largest producer in the Black Hills. Perhaps the damaging losses came from the mines and only a brief period of working rich ores could offset them. By 1924, the Trojan Mining Company's assets had been stripped to $1,356,401 and a financial salvage operation was needed to bring mines and mill back into production.

The Bald Mountain Mining Company 1928-1959

The Bald Mountain Mining Company was formed on November 1, 1928, and formally incorporated the following January. The property of the Trojan Mining Company was purchased for $87,946 and part of the holdings of the Mogul Mining Company were added. By the end of 1931 assets stood at $5,004,680.89, and property totaled about 3,000 acres. President Seaman was replaced by O. D. Collis from the company's Clinton, Iowa head office.

Apart from some development work, notably at Two Johns mine, the new owners remained largely inactive at first, employing only 30 men as a maintenance crew. An ill-timed start to milling operations in November and December 1930 foundered due to lack of financing, and work was suspended until the price of gold rose from $20.67 to be fixed at $35.00 per ounce on January 31, 1934. The first mine to go back into production was the Portland followed by the Eagle. Other mines made small contributions but many were slow to return to full production (neither Clinton or Mark Twain began work until 1937). The Portland, Clinton, Dakota, Empire and Two Johns mines were the main suppliers of ore to the mill during the pre World War II period but a host of smaller operations were also working, including the Ajax, Alaska, Trojan, Mogul, Mark Twain, May Queen and Foley mines.

Investment at the mill immediately before World War II was considerable. Major changes were made in the ore crushing and milling facilities, and the plant was turned over to all-slime processing. In 1939 a whole new sub-section of the mill was added to undertake the preparation and roasting of unoxidized, or blue, ores, mainly from the Two Johns mine (but also from Clinton, Portland, Empire and Juno). A pilot test roaster was used for two years and a full scale roaster built 1939, beginning production on June 1st at a rate of 93 M tons per day. The mill ran three shifts, each staffed by a crusher operator, mill man, and solution man. Also employed were a superintendent, foreman, repairman and assistant, an oiler, sample house operator, assayer (on the day shift only) and two night watchmen. Investment in the mines and mill paid off as production rose at a steady pace from a 1935 total of 86,760 tons of ore milled to 119,510 tons in 1937, 122,524 tons in 1939 and a peak of 134,985 tons for the year 1941. During the same period, however, the cost of running the mill rose in equally dramatic form, from $113,985.07 in 1935 to $193,633.85 in 1941.

Perhaps the two key factors in the maintenance of profits during this period were the production of high value ores from the mines and the availability of cheap labor with which to do it. As early as 1937, manager C. E. Dawson commented that "we have practically reached the limit of further extension of the ore bodies in the Portland mine." The significance of this remark lies in the fact that Portland had produced 82,421 tons of ore that year, over 50% of the company's total output. Dawson predicted a drop in production "before long" and was proved correct by the Portland's fall to 24% of the total by 1940 and 19% the following year. The pumping out of Two Johns mine and its return to service, supplying high value ores to the new roasting facilities, was an important step in off-setting losses. The Bald Mountain Mining Co. was able to maintain an increase in profits despite the additional problem of the exhaustion of high grade deposits at Clinton mine in 1940. By 1941, Two Johns was supplying 25% of the company's output. Company president Collis had himself "anticipated lower amounts of gold... [in 1941, but] ...high grade pockets of ore helped to make up the total figure." It is also worth noting that a long fought battle with the state of South Dakota to have the company's taxes reduced had resulted in partial victory in this year, further improving results.

The internal problems of the Bald Mountain Company were overshadowed by War Production Board Order L-208 which compelled the closure of gold mines for the duration of World War II to conserve resources and release labor for other work. The order was issued on October 8, 1942, but the Bald Mountain Company was allowed to continue small scale production for six months from December 7th of that year. That time was taken by the processing of ore, already broken in the mines, at a rate of 125 tons per day. Final closure was on May 25, 1943. Despite many years of litigation, compensation was not forthcoming from the government and the company weathered the war time period while a six man maintenance crew attempted to limit deterioration.

Even during the war it was understood that a post-war labor shortage was inevitable. Collis wrote in 1943 that "we [the board of directors] are in hopes that when the war is over many of our former employees will return to us," but he was to be disappointed. The war resulted in a severe drain of skilled mining labor from the Black Hills. Many miners and some of the company's key personnel who moved into other branches of the mineral industries during wartime did not return.

Work recommenced on July 1, 1945 with the Portland, Clinton and Dakota mines re-opening first. Small contributions from Foley and Mogul mines followed and the Decorah was brought back into production in 1953. Open cut mining was developed on a small scale and a scattering of pits supplied ore during summer operating seasons from 1948-59. Some custom ore was also taken in from outside mines such as the Astoria and Gold Bug. Two Johns remained closed as roasting had become uneconomical. The mill began work at 100 tons per day but was processing 322 tons per day in 1949. A peak of production was reached in 1952 with a 370 tons per day rate established. Throughout this period virtually no structural alteration of the mill took place. It is likely that the company did not consider the expense warranted in light of the declining ore values.

The company's reliance on cheap labor during the pre-war years had discouraged it from mechanizing mine work. After the war this dependance exacerbated the labor shortage problem and machines were hastily employed wherever possible. Workers were still hard to get, resulting in escalating wages in competition with the Homestake mine. The turnover of labor was exceedingly fast, in fact 100% in 1946, but the company was able to maintain its work force at an average of 118 per month, a huge improvement on the 83 that had been secured the year before. Mechanization and more efficient mining techniques had enabled the company to reduce labor requirements by 30% from pre-war levels, but this reduction proved to be insufficient as costs rose in the 1950s.

Little more than a year after operations had recommenced Collis wrote gloomily of how "there is a feeling among the executives that the life of the Bald Mountain Mining Company is very limited. In fact we should not consider its life excepting from year to year." Expenses rose, especially underground, to problematic levels. "The mining expense is climbing considerably and there does not seem to be anything we can do about it," Collis wrote in 1946. The cost per ton of ore milled in 1946 stood at $5.07. The lowest during the company's operation had been $3.47 in 1942 and the previous highest $4.41.

This situation was to worsen in the next decade and the final working mines (Portland, Clinton and Dakota) closed on July 25, 1959. The mill had been operating minimum hours on a skeleton staff through the winter of 1958-9 and milling operations finally stopped on July 31, 1959.