VALDEZ - A Canadian company is hoping to return large-scale gold mining to Valdez.
Western Warrior Resources of Calgary plans exploratory drilling of Cliff Mine seven miles along the coast west of Valdez this fall. The firm is investing $350,000 in the effort to reopen the former gold mine.
Mayor Bert Cottle said reopening the mine would help to diversify the area's economy. The company plans to employ from 25 to 40 miners.
Bruce Evans, president of Western Warrior, met with Valdez City Manager Dave Dengel and Lisa Von Bargen, Valdez's director of development, on Sept. 5 in order to discuss the plans for the mine.
"What they are planning is a small operation," said Von Bargen. "It must be a good incentive though considering the exchange rate (with Canada)."
Cottle said that gold prices will have to remain stable or rise to make the project feasible. Gold is currently selling for $385 an ounce.
He said then there will be the costs of pumping out the mine shafts of sea water.
Cottle said it's worth exploring the possibilities because the mine was the richest gold mine in Prince William Sound at one time.
Evans' firm contracted an independent study of the mine which said it contained "high grade mineralization over narrow widths still present in the lower mine levels."
Western Warrior bought the mine from heirs of Cliff Mine in 1997 but then gold prices fell. With the current rise in gold prices, Western Warrior plans diamond drilling 5,000 feet of core samples beginning this fall and scheduled for completion in the spring of 2004.
The six test sites will range from 650 feet to 800 feet deep.
Cliff Mine was first staked by H.E. Ellis in 1906 who sold it to the Cliff Mining Company in 1909. Gold production began in 1910.
By 1911, miners began following a gold vein under the sea floor.
The federal government closed the mine in 1942 because of the war effort. By then it had produced 51,740 ounces of gold worth $19 million by today's standards.
The mine also produced 8,000 ounces of silver.
The mine was severely damaged in the 1964 earthquake.
In the 1980s, an attempt was made to reopen Cliff Mine with the shafts retimbered and some other structures added, but the project was dropped when gold prices fell.