COLORADO DIAMOND MINING
Secured Solutions Diamond Mining In Colorado
Mining in Colorado, a state of the United States, has been an industry since 1858, and played a key role in the establishment of the state of Colorado. Explorer Zebulon Pike heard a report of gold in South Park, present-day Park County, Colorado in 1807. Gold discoveries in Colorado began around Denver, traced the placer gold to its source in the mountains west of Denver, then followed the Colorado Mineral Belt in a southwest direction across the state to its terminus in the San Juan Mountains. The Cripple Creek district, far from the mineral belt, was one of the last gold districts to be discovered.
How much active mining is there currently in Colorado?
Full Speed Ahead! American Diamonds!
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Kelsey Lake Diamond Mine
Kelsey Lake Diamond Mine is a defunct diamond mine in Colorado, USA. It is located in the State Line Kimberlite District, near the Wyoming border, and consists of nine kimberlite volcanic pipes, of which two were open pit mined. At the time it was operating, it was the United States’ only modern diamond mine, and only the second commercial diamond mining operation in North America, the first being in the Crater of Diamonds State Park, Arkansas which was mined in the early 1900s. Ever since diamonds had first been found in the State Line Kimberlite District in 1976, interest had been high in locating a viable commercial mining operation. Geologist Howard Coopersmith headed the Diamond Company L.N. which explored the feasibility of mining diamonds at the Kelsey Lake site. In 1995 Australian firm Redaurum acquired controlling interest in Diamond Co. and proceeded to lease mining rights for the land around Kelsey Lake . Commercial output started in May 1996. After mining and selling approximately 200 carats worth of diamonds, Redaurum was sued by Union Pacific who had originally sold the land in 1896 but claimed that it held on to the mineral rights. The two parties settled the lawsuit but in September 1997 Redaurum decided to liquidate its diamond properties to concentrate on exploration. The mine was operated sporadically until the operation was acquired by McKenzie Bay International Ltd. in 2000. McKenzie bought the mine management firm Diamond Co. from Chapter 11 bankruptcy, transferred all its assets to a subsidiary, Great Western Diamond Co., and invested $2 million in new equipment for the mine. In 2001, McKenzie tried to sell the mine to focus on mining vanadium after the price of that metal rose dramatically. However due to a dispute with the landowner over royalty payments, the sale fell through and McKenzie was unable to find another buyer. The mine ceased operations in 2001, and the site was fully reclaimed by 2006.
Of the nine volcanic pipes found, three were reported to contain diamonds, and two (KL-1 and KL-2) were mined. These two pipes are each approximately 10.5 acres (4.2 ha) in area, are at least 350 feet (110 m) deep, and are situated 0.5 miles (0.80 km) apart. Bulk sampling during exploration in 1990 and 1991 recovered grades of 3.4 to 4.5 carats per hundred tons (cpht) for diamonds larger than 2 millimetres (0.079 in). Of the diamonds recovered, 50-65% were gem quality, and 25-30% of those were 1 carat (0.20 g) or larger. While Redaurum ran the operation, the mine ran at half-capacity and produced almost 12,000 carats in 1996 and 9,000 carats in 1997. Due to Redaurum’s African operations taking most of their time and capital, during their tenure the mine was unprofitable. In addition McKenzie Bay estimated that due to Redaurum’s outdated equipment only 40% of the mined ore yielded diamonds, on the order of 1.5 cpht. When McKenzie Bay first acquired the mine, they estimated with their equipment improvements that they could recover 3.5 cpht from the ore. They also estimated that each of the two pipes being mined had about 340,000 carats worth of gems and could be profitably mined for about 10 years. The previous owners had a marketing agreement with local Denver diamond dealers to sell them Kelsey Lake diamonds for $115 per carat. If production had risen to the expected levels of 60,000 carats per year, McKenzie Bay expected to make $6.9 million annually. However with the rising prices of vanadium McKenzie Bay shifted their focus away from Kelsey Lake and began mine reclamation procedures in 2003.
The price of diamonds depends mainly on the 4 C’s of diamonds – carat, color, clarity, cut. Because of this pricing system large gemstones are worth more than a comparable mass of smaller stones. For this reason a successful diamond mining operation can’t rely solely on the mass of carats recovered. The Kelsey Lake mine has produced some large stones. In 1994 a 14.2-carat, gem-quality white diamond was recovered. At the time the sixth-largest diamond ever found in North America, it was described as “almost flawless” and estimated to be worth $250,000. In 1996 the largest diamond found at the mine was discovered. Named the “Colorado Diamond,” it was a 28.3-carat (5.66 g) yellow stone and the fifth-largest diamond found in North America. The gem was cut and polished by legendary New York diamond cutter Bill Goldberg which yielded a 5.39-carat (1.078 g) faceted stone that sold for $87,500. In July 1997, the company found two gem-quality stones weighing in at 16.3 carats and 28.2 carats. The 28.2 carat diamond was cut into a 16.86-carat stone, one of the largest finished stones ever produced in North America. The cut diamond is bigger than the gemstone produced from the “Uncle Sam” diamond, which was cut into a 12.42-carat stone.
Cripple Creek Gold Mining
Part-time cowboy and full-time drinker” Womack found gold float in 1879, which led him to diggin countless prospecting holes in an attempt to find its lode, earning him the name “Crazy Bob”. His efforts finally paid off in 1890, when he found the El Paso lode. Winfield Scott Stratton discovered what became his Portland Mine at the site of Victor. By 1893, 10,000 miners working the district, produced one third of Colorado’s gold output. Gold cyanidation was introduced in 1895, and used alongside chlorination in the mills for gold extraction. By 1895, half of Colorado’s gold production of 660,000 ounces came from the district. In 1897, half a million Troy ounces of gold was produced, and in 1900, 900,000 troy ounces, two thirds of the US output. By 1920, 41 mines were active, and cumulative gold production was over 500 tons. Although known as the “Pike’s Peak Gold Rush” because Pike’s Peak was a landmark visible 100 miles (160 km) out on the plains. Located a few miles southwest of Pike’s Peak, the Cripple Creek district, the most productive gold-mining district in Colorado, was not discovered until later in the “rush”. The towns of Cripple Creek and Victor were established to serve the mines and miners of the district. Among the principal mines were the Mollie Kathleen Gold Mine at Cripple Creek and Stratton’s Independence mine, at Victor, Colorado. Gold production up to 1990 was 21,000,000 troy ounces (650 t) worth about US$17 billion at 2008 prices), making it the most productive gold-producing district in Colorado, and the third-most productive in the United States (after Carlin, Nevada and Lead, South Dakota). The Cripple Creek mining district covers a Miocene volcanic caldera filled with quartz latite porphyry. The ore bodies are veins and replacement zones within the quartz latite. The ore minerals are gold and silver tellurides, with accessory fluorite. The Cripple Creek & Victor Gold Mining Company formed in 1976 as a joint venture to restart mining in the district. From 1976 to 1989, the company produced 150,000 troy ounces (4.7 t) of gold by reprocessing tailings and mining two small surface deposits. The Cripple Creek & Victor Gold Mining Company began the first large-scale open pit mining in the district in 1994. The Cresson mine open pits are located a few miles north of Victor. Mining continues today under the ownership of AngloGold Ashanti, producing about 330,000 troy ounces (10 t) of gold annually, valued at about US$270,000,000 (2008 prices).
Placer gold was discovered in the Breckenridge, or Blue River district, in 1859 at Gold Run by the Weaver Brothers, at Georgia, American, French, and Humbug Gulches on the Swan River, on the Blue River itself, and at the confluence of French Gulch and the Blue River. Harry Farncomb found the source of the French Gulch placer gold on Farncomb Hill in 1878. His strike, Wire Patch, consisted of alluvial gold in wire, leaf and crystalline forms. By 1880, he owned the hill. Farncomb later discovered a gold vein, which became the Wire Patch Mine. Other vein discoveries included Ontario, Key West, Boss, Fountain, and Gold Flake. Lode deposits were developed in the 1880s, as prospectors followed the gold to its source veins in the hills. Gold in some upper gravel benches north of the Blue River was recovered by hydraulic mining. Gold production decreased in the late 1800s, but revived in 1908 by gold dredging operations along the Blue River and Swan River. The Breckenridge mining district is credited with production of about 1,000,000 troy ounces (31 t) of gold. The gold mines around Breckenridge are all shut down, although some are open to tourist visits. The characteristic gravel ridges left by the gold dredges can still be seen along the Blue River and Snake River, and the remains of a dredge are still afloat in a pond off the Swan River.
South Park districts
Prospectors discovered rich placer deposits on the west side of South Park in 1859. The deposits were in valleys on the east side of the Mosquito Range. The principal districts were the Alma-Fairplay district on the headwaters of the South Platte River, and the Tarryall district along Tarryall Creek northwest of Como, Colorado. Important lode gold deposits were later discovered above Alma. A floating dredge worked the floor of the South Park valley east of Fairplay from 1941 to 1952, leaving the distinctive gravel ridges that can still be seen. Production from the Tarryall district was 67,000 troy ounces (2.1 t), almost all from placers. The Alma-Fairplay district produced 1,550,000 troy ounces (48 t), more than two-thirds of which came from lode deposits.
Central City-Idaho Springs district
On January 5, 1859, during the Pike’s Peak Gold Rush, prospector George A. Jackson discovered placer gold at the present site of Idaho Springs, where Chicago Creek empties into Clear Creek. It was the first substantial gold discovery in Colorado. Jackson, a Missouri native with experience in the California gold fields, was drawn to the area by clouds of steam rising from some nearby hot springs. Jackson kept his find secret for several months, but after he paid for some supplies with gold dust, others rushed to Jackson’s diggings. The settlement was later renamed Idaho Springs, after the hot springs. Gold mining in Colorado is located in Colorado Cripple CreekCripple Creek FairplayFairplay Central CityCentral City BreckenridgeBreckenridge SummitvilleSummitville TellurideTelluride Gold-mining centers in Colorado In May 1859 John H. Gregory found a gold-bearing vein (the Gregory Lode) in Gregory Gulch between Black Hawk and Central City. Within two months many other veins were discovered, including the Bates, Gunnell, Kansas, and Burroughs. Other early mining towns in the district included Nevadaville and Russell Gulch. Hardrock mining boomed for a few years, but then declined in the mid-1860s as the miners exhausted the shallow parts of the veins that contained free gold, and found that their amalgamation mills could not recover gold from the deeper sulfide ores. Nathaniel P. Hill built Colorado’s first successful ore smelter in Blackhawk in 1868. Hill’s smelter could recover gold from the sulfide ores, an achievement that saved hardrock mining in the district. Other smelters were built nearby. Through 1959, the district produced about 6,300,000 troy ounces (200 t), mostly from sulfide veins in gneiss and granodiorite. The early gold discoveries were at the northeast end of the Colorado Mineral Belt, a large alignment of mineral deposits that stretches northeast-southwest across the mountainous part of Colorado. From Idaho Springs, prospectors followed the Colorado Mineral Belt west along Clear Creek, then over the mountain passes to South Park and to the headwaters of the Blue River.
Mining in today’s times.
Colorado gold mining production was 270,000 ounces in 1892, 660,000 ounces in 1895, peaked in 1900 at 1,400,000 ounces, and reached over one million ounces in 1916 for the last time. Gold production in 1922 was 300,000 ounces, and 200,000 ounces in 1928. The Gold Reserve Act helped increase production to 370,000 ounces in 1936. Production was 380,000 ounces, before the War Production Board limitation order L-208 stopped gold mining in 1942. Production restarted after World War II with 168,000 ounces in 1947. Gold production was 66,000 ounces in 1960 and 22,000 ounces in 1967. Production reached 37,000 ounces in 1972 and 72,000 ounces in 1978. Three Colorado mines continue to produce gold. The Cripple Creek & Victor Gold Mine at Victor, an open-pit heap leach operation owned by Newmont Mining Corporation, is the leading producer, with 8.8 tonnes (310,000 oz) of gold in 2006. Other active gold mines in the state are underground Golden Wonder Mine near Lake City, and the Cash and Rex mines in the Gold Hill mining district in Boulder County, Colorado.