Venture Gold operates in the Central City/Idaho Springs gold mining District. This area is one of the premier high-grade vein type mining districts in North America. The first vein type gold discovery in this District was made in 1860 at Gregory Gulch, near Central City. A flurry of activity followed with miners flooding into the area; staking claims, digging prospect pits and developing mines. In a short period of time some 300 mines were in various stages of development and production. Some of the larger mines were developed by mining companies who had the financial and engineering ability to develop the underground. A few of the mines went to a depth of 2000 feet but the vast majority of them were small operations being worked by 2 or 3 miners. The average depth of mines in the District was approximately 500 feet. Smelters were built to process the ore. The District was just getting started when it was completely shut down by the Federal Government for World War I. All of the mines were “in ore” at the time of shut down. The price of gold was fixed at $20 per ounce and the economics were such that the mines never re-opened. Despite the brief period of time the District was operating, it produced 10 million ounces of gold equivalent (gold and silver). Based on past production history it is obvious the District was just starting to be developed and that vast amounts of gold remain to be mined.
When the mines in this District were productive in the late 1800s and early 1900s the preferred mining method was to develop the mine and mine the deposit staying in the vein itself, thus reducing dilution. With gold at only $20 per ounce, the miners had to high grade the veins. Therefore, they would try to take only the high-grade streak in the vein that ran higher than .40 ounces of gold per ton. That was the economic cut off. The average grade of these high-grade streaks was approximately .75 ounces of gold per ton. This can be verified in numerous USGS reports and various other mining records. Because many of the high-grade streaks ran less than 4 feet wide, it was necessary for the miners to take some of the adjacent low-grade ore. The miners would leave as much as possible of the low-grade ore in the mine. The low grade that had to be mined along with the high grade was brought to the surface and hand sorted from the high grade. The high-grade ore was
transported to the smelters and the low-grade ore was dumped on the surface. Examination of most of the dumps in the area of interest reveals that due to the nature of the mining, the dumps are almost entirely composed of gold ore with only insignificant amounts of non-gold bearing country rock. The district may contain as much as 100 million ounces of gold yet to be developed and mined, along with approximately 5 million tons of these surface ore piles