GOLDMINING

Press, Volume LXXII, Issue 21727, 9 March 1936, Page 8

GOLDMINING

TO THE EDITOR OP THE PEE3B. Sir,—Having read the letters of your correspondents, “Argus,” and P. G. Thomas upon the goldmining industry, I would like in the first place to answer “Argus’s” enquiry. Reviewing the activities of the goldmining enterprise over this last five years, you find that apart from one underground alluvial and two small sluicing claims, there has been no new profitable goldmining carried out, except by dredging. The primary cause of the lack of confidence of New Zealand investors is very apparent. They have lost considerable sums of money, and this, in my opinion, has been brought about by the incompetence and lack of technical knowledge of those who were responsible for the beginnings Of the enterprises. They have tackled forms of mining in which the cost of obtaining the gold is enormous, as compared with dredging. Take underground alluvial mining. The cost of mining and treating a cubic yard of dirt in this type of mining is anything' from 14s to 20s a cubic yard, so it is quite obvious that for this type of mining to be payable, the values have to range above these figures. When it is realised that the major Gortion of the alluvial areas left in eW Zealand only contain values ranging from 4d to Is 8d a yard, it is obvious that this form of mining is very hazardous, and to say the least, almost impossible to carry on successfully/ With hydraulic sluicing the costs are much lower, but the majority ol failures that - have occurred over the last few years have been because the supply of water has not . been great enoughin volume nor high enough in

pressure to be able to break down the gravels in sufficient quantities to put the work on what I term a "factory” basis, that is. getting continuity of operation; ’Another'factor' which has added to the failures of a great many sluicing companies has been the inadequate preliminary work of prospecting on a scale sufficient to warrant the promoters’ offering investment to the public. , , . v Getting down to dredging on a factory basis, which, in the writer’s opinion is as sound and as profitable a form of industry as - it is possible to get in this country, there is nothing wrong with this type of mining when operations are carried out in an efficient manner, . On the West Coast to-day there are several local companies operating dredges which, with one exception, have paid dividends, and at the present time are. working at a profit. If your Correspondent ; T ‘Argus” had been watching the financial page of your paper over this'last year, he would find that the average returns of these dredges have been in the vicinity of 45 to 50 ounces of gold a week, and the average profit £2OO. If “Argus” is interested in the min-, ing industry as an investment I wpuld suggest to him that if he confines his investment to dredging and, before putting money into a concern, he finds out whether the ground has been well prospected, he will not go wrong, but will be able to get his share of the golden harvest that will be won from our alluvial gold-bearing areas.—Yours, etC ” INVESTOR! March 7. 1936.