ASHEBORO — A second gold rush is under way in North Carolina.
Record prices for the flashy metal and a rich find just over the border in South Carolina are driving a quiet boom in exploration and land acquisition for a mineral that played a huge role in the state's early history.
Mining and exploration companies, many of them from Canada, are leasing mineral rights to thousands of acres in the Piedmont south and west of the Triangle - much of it near historic gold mines abandoned decades ago - and boring dozens of test holes to pinpoint the best places to mine.
Much of the work putting together land rights is secretive for fear of attracting competition, mineral company officials said.
"I personally know of eight different companies that are very active in South Carolina, and all of them are likely to be looking in North Carolina," said Tim Daniels, president of Erin Ventures, a Canadian mining and exploration company working in both states. "I'd expect to see pretty substantial activity there become more public as they announce land packages and more drilling results in the next year or so."
Gold prices have soared, hitting a record this week of $1,441 an ounce. That means ore that once would yield little or no profit suddenly is a bonanza. Advances in exploration and mining techniques also are making deposits that were previously uneconomical more likely to be winners.
Erin Ventures, which has mining projects in Serbia, Panama and the Yukon, has bought mining rights to about 2,000 acres in South Carolina and 1,000 acres in Moore County, about 60 miles southwest of Raleigh. It was happy with earlier tests on ore samples here but had trouble convincing investors to fund more work, Daniels said, until the scope of the Haile find in South Carolina made the Carolinas a major topic in the mining world.
Now Erin plans a "fairly aggressive" exploration program in North Carolina over the next year or so, perhaps as a joint venture with another company.
Exploration in the Carolinas is easier than many places because infrastructure such as roads and electricity is handy. It's difficult in one way, though: Nearly all the property involved is privately owned, and it takes time and money to assemble the rights to the large tracts required, Daniels said. Companies often go about this quietly over a period of years until they have pulled together the tracts they want and start to seek investors.
Some are at that stage. Another Canadian company, Revolution Resources, has gone public about its exploration at sites near old mines north of Asheboro.
A team of about a dozen Revolution geologists, technicians and laborers arrived mid-October, some of them directly from work in Alaska. They began exploring the sites where they have leased mineral rights; sites that start about 10 miles west of Asheboro and stretch across thousands of acres in Randolph and Davidson counties.
They rented an unheated metal warehouse tucked among a dozen or so others in an industrial neighborhood on the north side of Asheboro. For months, they have trucked in thousands of feet of rod-like samples of stone from their drilling.
The samples are sliced in half diagonally with screeching, gas-powered saws. Company geologists then examine each sample, recording data about the characteristics of each into dust-covered computers. Half of each sample is sent to an assay company that tests for gold content. The assay company is independent to protect potential investors.
So far, the company has drilled a few dozen test holes, some a quarter mile deep.
In February, Revolution Resources announced that it had raised more than $9 million by selling stock. On Friday, it announced that it had acquired rights to additional tracts, including old gold mines, that boosted its total land package to more than 5,000 acres.
The idea of a second gold rush here might surprise those who don't know about the all-but-forgotten first one.
The nation's first documented gold was found near Charlotte in 1799 when a 12-year-old boy stumbled over a 17-pound nugget. His family used it for a door stop for awhile. When they realized it was gold, the father sold it - for $3.50.
At first, it was just a few farmers digging and panning part-time. But word spread, and prospectors flooded in. Eventually there were hundreds of pits and mines, and for years gold was second only to agriculture as an economic engine.
The federal government built a mint in Charlotte that coined gold from the region from 1838 until 1861. At various times, gold was mined commercially in about a third of the state's 100 counties and extracted as a byproduct of copper mining in others.
Mines were dug as far east as Wilson County, by some accounts, and at one point there was one just west of Chapel Hill. Mostly, though, gold was found farther west in the Piedmont, much of it in and around Mecklenburg County.
Gold was mined commercially in the state throughout the 19th century and into the next, with interest waxing and waning.
In sites they're exploring west of Asheboro, geologists with Revolution have repeatedly run across old mining pits up to 50 feet deep and 150 feet across and other remnants of past gold operations. The old miners were able to recover only the gold that was freed from the rock by weathering, so they stopped once they got past the top layers, said Jason Olshenske, a 25-year-old exploration geologist from Pennsylvania.
They've also met people who remember when gold was mined in the area.
"You run across these people in their 80s who can remember taking lemonade out to the miners during the Depression," Olshenske said. "That's pretty cool."
Most gold mining in the state died off in the early 1940s, but interest swelled again after a successful mine, the Ridgeway Mine near Columbia, S.C., began operation in the late 1980s. Exploratory work was done in several North Carolina Piedmont counties in the early 1990s. Prices weren't high enough then to encourage mining, and interest died again.
A new gold rush
The new rush in the Southeast is along a volcanic and sedimentary formation called the Carolina Slate Belt that runs from southern Virginia to Georgia, slashing diagonally across the middle of the Carolinas. The action is centered around the Haile Mine near Kershaw, S.C., where a Toronto mining firm named Romarco Minerals has found rich deposits of gold around a mine site first dug in 1827. Some analysts believe the reserves may top 4 million ounces.
In a recent feasibility study, Romarco projected that about 84 percent of the gold is recoverable and that it will initially cost $347 an ounce to mine and refine, a figure that suggests huge profits given current gold values.
There is so much gold in the ore at Haile that it's clearly visible in some samples, a big deal in an industry that can consider it profitable to dig mines where there is less than a paper clip's amount of the metal in each ton of rock.
"They have found bonanza-grade, museum-quality specimens, and that suddenly got everyone interested in the Southeast U.S.," said Pete Evans of Fuquay-Varina, who heads two companies, Triangle Minerals and Uwharrie Resources, that explore for gold and piece together property.
Also driving interest in North Carolina is the fact that much of the best land south of the state' border is already locked up, Daniels of Erin Ventures said.
"In South Carolina, pretty much any landowner we talk with now has been approached by three or four companies and is weighing which offer is best," he said.
Timeline for mining
Prospects in North Carolina are still just prospects, but mining company officials are optimistic.
Test drilling doesn't require permits, but the state permitting process for an actual mine is complicated because of the potential for environmental issues. No one has started that process yet.
If any of the companies decide to mine, Evans said, they are probably two or three years away from seeking permits. Actual production of gold would be five to eight years away.
Even if the tests look great, other things could happen, like a fall in prices, that could lead companies to drop their plans. The local economies, though, stand to gain, as do landowners, who are paid for the rights to explore - typically a couple of hundred dollars an acre up front and more annually - but get more if and when the gold starts coming out of the ground.
Evans said that while the Ridgeway Mine was in production, into the 1990s, it pumped $30 million a year into the local economy and made millionaires out of some landowners.
In South Carolina, Romarco said in February that it hopes to begin mining by the end of the year. It now employs more than 100 people there and has said that it could employ 500 during construction and 300 when the mine goes operational, a big deal in a place where unemployment is nearly 16 percent.
The new boom is coming at a time when gold has become a flashy metallic celebrity. The record prices are generating big media attention.
And two weeks ago, Senate Majority Leader Harry Brown, an Onslow Republican, filed a bill that would recognize gold as the official state mineral.
Brown said he did so after being asked by fourth-graders at an Onslow school. He had talked to them about how bills are filed, and later a teacher e-mailed and said her students had found that the state didn't have an official mineral. Because of gold's history here, the students thought it would make a good one.
Now it's looking as if gold might have a big future, too.
"When I was in high school, gold was about $35 an ounce, and it wasn't worth your time to pan it," said Kenneth Taylor, the chief geologist with the N.C. Geological Survey. "At $1,400 an ounce, it's something worth getting interested in."
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