Black Hills Knowledge Netowork

The 1876 discovery of the Homestake gold claim led to 39.8 million ounces of gold produced.
The 1876 discovery of the Homestake gold claim led to 39.8 million ounces of gold produced.
Black Hills Knowledge Network Photo/Chelsea Gortmaker
April 4, 2016

IN HISTORY: Manuel Brothers Discover Gold Outcropping at Lead, April 9, 1876

When Fred and Moses Manuel, Hank Harney and Alex Engh discovered a gold outcropping near Lead, they claimed their find and named it the Homestake

They had located the area from which the placer gold in Deadwood Creek had eroded. More rock mining regions opened up around Lead and Deadwood because of this discovery.

For $70,000 in 1877, a trio of mining entrepreneurs -- George Hearst, Lloyd Tevis, and James Ben Ali Haggin -- bought the Homestake from the men who discovered it. Hearst arrived at the mine in October 1877 and took active control of the property.

Hearst had to haul in all the mining equipment by wagon from the nearest railhead in Sidney, Neb. Despite the remote location, an 80-stamp mill began crushing Homestake ore in July 1878.

The partners sold shares in the Homestake Mining Co., and listed it on the New York Stock Exchange in 1879. The Homestake would become one of the longest-listed stocks in the history of the NYSE.

Homestake miners crushed rock to release the gold, concentrated the gold by gravity methods, and then exposed the concentrate to mercury that would amalgamate or mix with the gold. Miners call this kind of gold ore "free milling." Gold existed elsewhere in the Black Hills, but it was not in the free-milling state. Gold chemically bound to rock and difficult to remove is called refractory gold ore. 

For many years, the Homestake operated as the only major gold mine in the Black Hills. Mining ceased from 1943 to 1945 due to World War II, and the mine closed at the end of 2001 amid low gold prices. Through 2001, the mine reached 8,000 feet deep and produced 39.8 million ounces of gold and 9 million ounces of silver.

Soon, scientists coveted the mine's extensive underground structure for research purposes, after physicist Ray Davis had won a Nobel Prize for his neutrino experiment. (See related article.) After a complex process of securing funding, negotiating scientific turfs and some political tussles, Homestake Mine became an underground research facility, now known as Sanford Lab. It is named for philanthropist T. Denny Sanford, who donated $70 million to the project. 

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