High gold prices sparking a new kind of gold fever

Posted: Wednesday, May 31, 2006

ANCHORAGE - High gold prices have produced a rush, at least at mining supply stores.

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Stores and suppliers say they're having trouble staying stocked as people lured by $600-per-ounce gold gear up to try placer mining.

"People are dropping what they're doing and figuring they're going to strike it rich," said Steve Herschbach, co-founder of Alaska Mining & Diving Supply.

Herschbach sells dredges, sluice boxes, gold pans, picks and other mining equipment.

"Everything is running out," Herschbach said.

With the mining season in full swing, his main supplier is backlogged.

"We're running out of stuff faster than I can build it," said Mark Keene, whose family owns Keene Engineering of Chatsworth, Calif., a company that manufactures portable mining equipment. "The phone calls are relentless."

Keene said he had just hung up with a client in Sierra Leone. He ships worldwide, and his business in Liberia, Tanzania, Ivory Coast and Mali is booming.

Gold has been hovering above $600 an ounce since mid-April and people from all over are calling Herschbach, state mining officials and others in the industry, wondering where they can look for gold.

Placer miners search for gold in riverbeds with a variety of hand tools and machines. It's attractive because it does not require a huge investment to get started.

"Alaska still has the reputation as a place where the individual prospector can go out and have a shot at it," Herschbach said.

Internet chat rooms and gold forums have been busy with posts by people debating plans to move to rural Alaska to mine.

"When you get gold rush mentality, people literally get up in the morning and say, 'I'm going to go mining,"' Herschbach said.

Al Johnson, president of Hope Mining Co., said his business is up 300 percent since last year.

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