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The Bedrock of Idaho: Risk vs. Reward in Idaho Mining Country

The riches of Silver Valley come at a cost, but there's no shortage of people willing to pay

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Seth Gray is wearing his dead brother's clothes. In front of a high school gym packed with mourners, he stands in Brandon's torn jeans, yellow string holding the back pockets together, and the weathered jersey his 26-year-old brother used to wear when the two of them would snowmobile in the boonies of North Idaho.

Gray strips off the jersey, revealing a black shirt with pink writing, a memento he'd bought with Brandon at a local shop. The shirt reads: "I PUT THE FUN IN FUNERAL."

"Some of you may think this dress is inappropriate," Gray tells the assembled grandparents, mayors, union heads, mining company CEOs and co-workers, "but I don't care."

The crowd chuckles. He had told the mourners that this funeral would not be sad, and now he's delivering on that. He jokes about the '70s-porn-star mustache that his brother had been growing and how he'll have that on his lip for eternity. And he talks about Brandon's pride and joy, his Ford F-250 Super Duty, now parked outside among the many trucks of Mullan.

Brandon had tricked out his rig with money he had made at Lucky Friday Mine, and, like many mourning him that day in November, he'd benefited from a boom in silver. Prices are high. Mines are re-opening and expanding. Companies are turning record profits.

But it's come at a cost. Brandon Gray was the second person to die at Lucky Friday Mine last year. In December, less than a month later, seven miners were injured in a rock burst and later rescued.

Federal regulators shut down the mine in January while its main shaft is cleaned, and the mining company, Hecla, says it could take up to a year to complete the repairs. In the meantime, the fortune of Silver Valley hangs in the balance, as some 200 well-paid miners are out of work.

People are angry--less, it seems, with Hecla than with the feds for interfering with the mine. Indeed, in this slice of North Idaho, silver isn't just a business, it's a way of life.

Good Geology

Army Lt. John Mullan was traveling with an army of workers from Walla Walla, Wash., to Montana in 1860, when they cut through a pass and into a valley easy of present-day Coeur d'Alene.

Mullan and his workers encountered a prospector there. The man had gold. Mullan saw it and promptly gave the man provisions and money and told him to scram. He didn't want his men running off in search of riches, according to Troy Lambert, a Silver Valley history buff at the Wallace District Mining Museum.

But rumors of gold made their way out of the valley, and as prospectors flooded the area, they eventually stumbled upon outcroppings of galena, a lead ore infused with silver. The prospectors had dug out nearly all of the region's gold in the first three years of the rush, so they turned to silver.

"The Coeur d'Alene Mining District," as it became known, is now considered one of the top five silver-producing districts in the world, said Earl Bennett, a former dean of the College of Mines at the University of Idaho.

"Ore deposits are often found where you got good geology," Bennett said. "And good geology has mountains."

The valley is a narrow strip of land, running from Fourth of July Pass in the west to Lookout Pass on the Montana border. It's a place familiar with booms and busts.

There have been good times, like the 1880s and 1890s, when mines were springing up all over the valley and the wealth flowed across the Inland Northwest. Spokane, Wash., became one of the richest cities in the world, shipping the valley's silver east to Minneapolis, Chicago and beyond.

"People in Spokane thought, in 1893, that with all the wealth ... this was going to be like San Francisco," said Bill Stimson, an Eastern Washington University professor, who wrote about the city's history in his book A View of the Falls.

But there have also been downtimes, like the 1980s, when a silver bubble burst, causing prices to plummet and operations--including the valley's most productive mine, Bunker Hill--to shut down.

"Everything tanked in the 1980s," Lambert said. "Mining's always been a cyclical thing in the valley ... but that was probably the lowest."

And there have been tragedies: In 1972, a fire at the Sunshine Mine killed 91 miners, leading to new safety devices like the emergency respirator every miner carries today. Not long after, in 1977, Congress established the Mine Safety and Health Administration to regulate the industry.

Finally, in 2004, prices started to creep up, prompting new interest. Meanwhile, Hecla, founded amid the boom in 1891, announced plans for two major expansions at Lucky Friday Mine. A new shaft was proposed that would reach down 8,800 feet and, the company said, keep the mine producing silver past 2030.

By 2011, silver was hovering consistently around $30 an ounce and, at one point, nearly reached $50. Hecla announced that it would begin exploring whether to reopen the Star Mine, and U.S. Silver, which owns Galena Mine near Osburn, said it plans to reopen its mine's deeper caverns, as well as bring the shuttered Coeur Mine back into production.

New companies are also forming to reopen long-shuttered mines. According to filings with the Securities and Exchange Commission, a company called Sunshine Silver Mines Corporation is eyeing the Sunshine Mine, which has produced the most silver ore of any mine in the valley. Another company is looking at reopening Crescent Mine.

Why the boom? Just look at your iPhone. Or your shirt. Or your portfolio.

"A smartphone and a tablet and a computer, all of those take a little bit of silver," said Phil Baker, Hecla's president and CEO. "In some cases a quarter of a gram, in some cases a gram, are in those things to work."

Besides that, there are solar panels, batteries and clothing, not to mention silver's use as an investment.

At the start of 2011, Hecla announced that the $418.8 million made in 2010 was a company record. But then last month, when officials announced that Lucky Friday would be closed for repairs, Hecla's stock dropped 20 percent in a single day.

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