Gold fever reaches Upper Rock Creek

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Golden Sunlight, which produced 28,000 ounces of gold in 2009, still uses cyanide because it was grandfathered in. Its track record includes the leak of 19 million gallons of cyanide solution in 1983. Vancouver, B.C.-based Placer Dome Inc. opened the mine in 1974. Toronto-based Barrick Gold Corp., the largest gold mining company in the world, acquired Placer Dome, and Golden Sunlight with it, in 2006 for $10.4 billion. Two weeks ago, Barrick reported that its first quarter adjusted net earnings rose 32 percent to $1 billion. "First quarter operating results exceeded our expectations and combined with strong metal prices and good cost control, resulted in significant growth in earnings and operating cash flow," said Aaron Regent, Barrick's president and CEO.

To be sure, the environmental impacts of vast, open-pit, cyanide heap-leach mines like Golden Sunlight are far more severe than the impacts of, say, the arsenic-tainted water coming out of the underground Drumlummon Mine. "Some companies are doing a very good job," says economist Larry Swanson, "and others do as bad a job as you possibly can."

Montanans familiar with gold mining's toxic legacy in the state tend not to make a distinction.

'A nightmare for these guys'

Dutch Gold's Dan Hollis insists the Basin Gulch Mine's environmental footprint would be minimal.

"I know that there are people who are worried about the environment, frankly, based on some of the things that have happened in the state of Montana in the past," he says. "I understand their concerns, but the technology's changed, and one of our core values is sustainability. It's not lip service, it's something that we really believe."

Hollis says Dutch Gold doesn't have "any plans any time in the near future" to pursue open-pit mining, even though the exploration focuses, according to the company website, on "identifying a large open-pit minable reserve."

"Our intention is to stay underground so that any impact on Rock Creek could certainly be minimized," he says, "and frankly, we wouldn't enter into a program that was going to have any negative impact on Rock Creek. I mean, it's one of the most beautiful areas in the world, and when I talk about being environmentally conscious, and serving all of the stakeholders, one of the stakeholders are the fishermen."

Bruce Farling, the director of Montana Trout Unlimited, doesn't buy it. He says Dutch Gold, whose portfolio consists of three properties, none of which are operational mines, is "trying to mine investors as much as they're trying to mine gold."

click to enlarge The Basin Gulch mine would sit in the hills above Rock Creek, a blue-ribbon trout stream. - PHOTO BY MATT GIBSON
  • Photo by Matt Gibson
  • The Basin Gulch mine would sit in the hills above Rock Creek, a blue-ribbon trout stream.

"It's a real mistake to do it in Rock Creek," Farling continues, "and [Hollis] ought to know that...Trying to permit a mine on Rock Creek is just going to be a nightmare for these guys."

Farling promises that Trout Unlimited will fight the mine whenever it's officially proposed. And it won't be alone. Groups like MEIC, the Clark Fork Coalition, and the Rock Creek Protective Association will also vigorously oppose it. The RCPA has concerns about the mine sending sediment downstream and exacerbating whirling disease. Says MEIC's Jensen: "It's a real bad idea to have a mine at the headwaters of Rock Creek. Period."

"High prices encourage scoundrels in the gold mining industry," Jensen continues. "They always have and apparently always will...It's a time for people to be very cautious about small operators like this that make a mess and go away, and leave the mess. I guess I'd hark back to Mark Twain's prescient analysis on the subject, and that was this: 'The definition of a miner is a liar with a hole in the ground.' It seems to be a truism for the ages."

Jensen is in Helena. Closer to Basin Gulch, at least some are less wary of mining. One Philipsburg-area resident, Barbara Clark, says, "Floaters do more damage to the river than the mine would."

Hollis maintains that his company can mine in an "environmentally prudent way." "This isn't greenwashing," he says. "We think that Montana is a great place for us to do business, and our hope is to find additional properties in the area and that we can build a significant presence in the state, and be a real contributor to the tax base and an employer that people want to come work for."

Historically, that's been an irresistible proposition in the Treasure State, and it's essentially no different today.

Farling says it's a haul he'd rather let get away: "If we actually need gold for real things, like industrial purposes and stuff, there's plenty of gold to be mined in the pawn shops of America. There really is—especially now."

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