Diversified Mining by Mick Manns
From The Proceedings of the Tenth Annual Conference on Alaskan Placer Mining 1988. Reprinted here by permission of the author, Mick Manns. Mick owns the Paradise Valley mining operation near Bettles.
Mick Manns came to Fairbanks, Alaska in 1969 where he went to work rebuilding trucks and other pipeline support equipment. In the winter of 1976, Mick moved to Bettles, where he began mining in the summer and working for the Department of Transportation as a heavy duty equipment mechanic in the winter. In 1983, Mick went into mining full time near Bettles, Alaska.
Diversified mining in Alaska can be profitable, and simultaneously conducted without additional impact to the environment. Diversified mining can be divided into commercial placer mining, lode or hard rock mining and recreational mining. If a miner has patience and likes people, and doesn't mind setting some ground aside and providing assistance in the form of time and basic services, it can be extremely rewarding. Most important, it helps educate people from all over the U.S. and the world, on prospecting, placer mining and methods of recovering placer gold. Furthermore, in some cases, this also includes educating visitors regarding the benefits of hard rock mining of gold and other minerals.
To better understand the potential value of diversified mining, one should know a few facts. There are at least two million recreational miners in the conterminous United States. These people are often members of some type of panning club, metal detector club or prospecting organization that is active in recreational mining. Some of these clubs may have as few as a couple of dozen members, while others have several thousand.
Each year about 400 (1988) recreational miners come to Nome, Alaska. Each of these people pays about $4,900 dollars for a few weeks of recreational mining at Nome. That's about $2,000,000 dollars for that one small group to spend each year. Suddenly it becomes clear that recreational mining is not the small insignificant business some people think it is.
Large scale commercial operators should also consider what the recreational prospectors and miners are doing for our industry. The recreational prospectors and miners have developed well organized groups. Some of these clubs have purchased or leased claims from miners and mining companies, while others pay daily, weekly or monthly lease fees to come in and pan for gold, shovel into a high banker, sluice box or rocker. Many want to dive and dredge for gold, while some prefer to use metal detectors to search for nuggets.
The list of what each group or each individual prefers is endless. We should also recognize the difference between amateurs and recreational miners. Although some are beginners, most understand how to use their equipment every bit as efficiently as commercial operators know how to use their respective equipment. Many of these people are middle to upper income, retired or semi-retired, and they spend the entire year going to panning and metal detecting contests that pay big prize money.
Some of these recreational prospectors are capable of finding gold, with a metal detector, that is missed with more expensive professional equipment. These people are experts, and are as attracted to the sport of recreational prospecting and mining as a hunter, fisherman or any other outdoor sports enthusiast. Many of these people think nothing of spending four or five thousand dollars to go to Australia for a contest or for a fun trip panning, dredging or metal detecting, then coming home for a few weeks and spending four or five thousand more on a trip to do the same thing all over again in Alaska.
We should keep in mind that the number of semi-retired and retired people is growing, and they are all looking for new and exciting adventures that could include recreational mining.
Because of their numbers, and because they have organization, unity and coordination, the retired people and recreational miners are important lobbyists for the minerals community. They send people to the United States Congress every year to persuade legislators to keep public lands open to mineral entry. They openly debate the B.L.M., the National Forest Service, the National Park Service and every other federal or state agency about natural resource issues. Recreational mining interests have initiated lawsuits against many federal and state agencies, and have occasionally obtained concessions or compromises. We Alaskans should consider them friends and business associates, in our mining diversification, and allies in our effort to keep mining alive and healthy in Alaska.
In conclusion, recreational mining can be a way to diversify a mining operation and provide additional income.
PARADISE VALLEY OPERATION
In our operation at Paradise Valley, we have recognized some of the requirements necessary to diversify into recreational prospecting and mining. It takes a lot of time and patience, and there must be at least enough gold in the ground to please the majority of the guests. In our experience, some guests have returned every year for five or six years.
It is a good way for people to get out of the cities and become educated about mining. But even more important, it is an excellent way for entire families to enjoy the out of doors together.
It requires a great deal of time to advertise and build up the business - going to gold and mineral shows and meeting with panning clubs; showing slides, movies, and videos. Last year, we traveled 16,000 miles and covered nearly all of the western states. This year, we traveled 12,000 miles and covered a good part of the western states.
Thirty or forty thousand dollars is required to build eight to ten cabins suitable for this type of business. Support equipment includes suction dredges, metal detectors, hand sluices, high bankers, rockers and furnishings for the cabins. Capital outlay for the operation will range from $50,000 to $100,000, not including the acquisition of the placer claims.
Recently, there has been support for this type of enterprise. For the first time in eight years, the Alaska Department of Tourism is recognizing this industry and making mention of it in the state's tourism magazines. In addition, because these clubs are organized and have regular meetings, word of mouth travels rapidly among them. If you do a good job and satisfy them, they can make it easy for you. If you want happy guests and return clients, it is seven days a week for six or seven months. So plan well, and good luck.
THE ECONOMICS OF DIVERSIFIED MINING
In addition to the support and economic asset these people represent to mining, the companies that manufacture the equipment are important supporters of the mining industry. Garrett Electronics has several thousand dealerships worldwide that sell metal detectors. Other metal detector companies have thousands of dealerships worldwide.
Keene Engineering manufactures suction dredges of all sizes and capabilities. And when we consider gold pans, spiral wheel concentrators, gravity separators, jigs, screens, classifiers, high bankers, pumps, hoses, shovel-in sluice boxes and dozens of other types of recreational mining equipment these companies sell, and then multiply that by the several million people who purchase and use that equipment, we have to agree that recreational mining has found its way into the economic structure of the United States. In many respects, the way these people are mining today is just a modern version of the way many a pioneer Alaskan miner existed in the rugged days of frontier Alaska.
If 200 recreational miners stay an average of 14 days, and each pays $100 dollars per day, the total paid for each two week stay is $1,400. Multiplying $1,400 times 200 comes out to a total for the season of $280,000. Allowing that 150, or three fourths, of them fly round trip from Seattle to Fairbanks, and often make stops in Anchorage, Juneau, and other points, at a cost of $480 per person: 150 times 480 amounts to a travel gross from these points of $72,000.
Now that these people have arrived in Fairbanks, they must have additional travel to Paradise Valley, Bettles, and points on north to their destination and back to Fairbanks. Taking the cost of round trip tickets to Paradise Valley and return to Fairbanks and occasional sightseeing trips, air services receive about $22,000. per year in gross income from recreational miners. In addition, each recreational miner brings in his own food and personal supplies which he purchases in Fairbanks. Each individual brings an average of $200 worth of provisions. $200 times 200 people amounts to $40,000. It should be remembered that these figures are in addition to the commercial mining money spent by the company in Fairbanks.
Additionally, each of these people spends about three days in the Fairbanks area. A minimum of $200 is spent by each person staying at hotels or motels, eating in restaurants, touring the area and purchasing souvenirs. $200 times 200 people increases the Fairbanks economy by an additional $40,000.
Perhaps the largest spenders that come to Alaska as recreational miners are those who travel the highways in motor homes, pickup campers and other R.V.s. This 25% or so drive an estimated 2000 miles instate. They spend $300 or more on gas, $200 or so on vehicle services, they purchase meals in cafes and often even spend a night in a motel just to break up the monotony and have a change of pace. While in their R.V.s they purchase groceries and personal goods in Fairbanks and other towns across the state. Usually, they spend two to three weeks recreational mining and about the same amount of time touring the rest of the state.
Consider, for example, two people per vehicle and the 25 vehicles that carry the Paradise Valley guests to Alaska. Their occupants spend about $1,000 per vehicle as they cover most of the state's road systems open to travel. This accounts for a total of about $25,000. It becomes clear that the total revenue generated by recreational miners that travel to Alaska eventually ends up spread across the state, helping the economic status of all Alaskans.
Where does the money go that the mine owner and operator receives from these recreational miners? Clearly, it finds its way into Alaskan businesses and residents through the purchase of materials and supplies; the diesel fuel and gas for operating, new equipment and equipment repairs lumber for cabins, mess halls, shops and other needed buildings, groceries and supplies for the operator and his crew, flying services for the operation, phone and utility bills, office and living expenses, crew's wages-the list is endless.
In conclusion, even using the simple calculation described above, it is clear that nearly $500,000 per year can be generated for Alaskans from one small recreational mining operation.
It would not be a complete report without considering that these recreational miners take home thousands of slides, photographs, and other Alaska memorabilia - not to mention thousands of feet of movie film and videos. While the state of Alaska and Alaska tourism-related industries and businesses are spending millions promoting Alaska tourism, these recreational miners are showing their pictures to millions of people in their homes and at club meetings, gold shows and various contests and other public doings, exciting and urging other people to come to Alaska and have fun with them, or at least see and experience Alaska.
Each year, these satisfied visitors create an advertising campaign in their own way, which leads to a new and growing group of Alaskan tourists and recreational miners. These new pioneers come north to Alaska and spread the word that mining is good for everyone.