The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1913-06-05
THE VALUATION Of MINES
continued From Page -

stan and bigger salaries; they NEAR
and an increase Of organization. An.
other result follows and il Is result
often under estimated, namely, 8
larger width of ore is stopped under
ground. the bigger scale of operation
and the lower average cost tempting
the superintendent to stope eight feet
where he previously stopped feet, OF
Is feet where he formerly broke only
TO- From this radical departure
spring results that modify the whole
enterprise, ana not always IN the mnn
ner expected Lower costs usually do
onsue from larger scale of work,
provided ii be inteligently planned.
but increased profits are not the in
variable concomitant of lower costs
You may reduce the cost by increas-
ing the output, but unless YOU find
more ore of the Same kind as before
your profit may wilt faster than your
the beneficial effect of lowering the
cost depends on two other factors
tonnage and yield, either Of which,
may vary. Experience has shown
that the sanguine expectations of the
companies and other new purchasers
of old mines are not always fulfilled
In such cases, and In other matters.
avoid conceit
An example will illustrate In 1900
! examined the celebrated Camp Bird
mine, in Colorado. The owner was
Thomas Il. Walsh, an experienced OPP
orator He had extracted S2.535,0OO
worth of ore at cost OF $3.50 per
ton. | estimated the assured ore al
a little over s6.0oO,ooo. and | suggest
cd that the cost could be cut down to
1925 per ton, as the result of inlprov-
ed equipment and larger operations,
The mine fulfilled every expectation;
it has yielded s227S5. 500 gross. of
which s11.400,n 900 hos boon profit But
the total cost per ton has been $40
Instead of lowering the cost, the cX
ploitation of the mine by a British I
company has raised Il. The reasons /
are more obvious now than they were
10 years ago. Walsh did not debit /
the mine with his salary. but he was |
an excellent general manager His |
superint endent was as good q man a.
the company's and cost loss. The di. |
rectors, offices, taxes aud general ex'
penses in London were IN additional +,
burden on the mine. "A consulting en-
glnccr was a further luxury incurred |
by the company. Moreover, the ne /
cessity for having big reserve Of |
ore. a large part Of it actually broken |
nnd LETT in the Slopes, IN order tr !
make the shareholders comfortable all |
entaied the use of capital unproduct-
lively. In short. the company had |
small reason to observe the minor |
economies that come naturally to an
individual owner. An increase in the !
scale of operations Is not advantag
eous II it transcends the economic
unit The economic unit is that rate
Of production most profitable to the
owner of the mine.
Where the Optimist Erred.
In the case of an undcvclopcd mine
in a new district, reliable figures con-
,erning cost are not available The
position is houcycor,bcd with pitfalls
cor the unwary. Most boom camps
are new, and many of them are SC
ISOLATED as to afford unfamiliar con-
litions. The youthful and careless
among engineers are apt to accept the
igures of cost affirmed locally b,
individuals eager to make
he best showing, or else they assume
,ata quoted from old and established
listricts This was well illustrated
luring the West Australian boom ir
1897. For instance was at a place
allied Earlston in August Of that year
o examine - series of prospects that
,ad been described by the pseudo
# an expert as highly promising
mines. After carefully samplinE 2
number of shallow workings, salts
led myself that the quartz contained
bout 1-2 dwt gold per ton ton, and
hat Mr. Optimist had either taken
lis samples from dumps that had beer
allied for bin, or he had sailed him
eli by selecting rich spots. However
ven II his average of IA dwt. had
een confirmed should have advised
ny clients tn drop the business. The
aluc of mine Is not measured by
he assay value of the ore, but by
he profit It will yield. These holes
n the ground offered 40 promise Of !
aging dividend. The cost Of oper-
ton then and for several wears there
fter, was more than | o.. or $40
or tou The nearest railway WAS a
'oolgardie, 175 miles distant. Sup
lies had TO be brought ON camels
ven timbers for q shaft we're trans /
~. - t,.lt, tIt