YALE
UNIVERSITY UBRARY

IBining íor IProfií.

BT
WALTER S. LOGAN,
PRESIDENT OF THE
SANTA JULIANA MINING COMPANY.

\Y)4.yíiCO

MINING FOR PROFIT.
Does Mining Pay ?
I have been met continually, since I have been engaged in
fighting the cause of Santa Juliana, with the assertion that mining
is not ordinarily a profitable business, and that success in it is the
exception and not the rule. Many people seem to suppose that
men, persistently, generation after generation, invest their capital
and employ their talents in mining enterprises notwithstanding that
such enterprises are usually attended with a loss. The United
States Census Bureau, in its report in September last upon mining
statistics, affords me timely succor, and I quote the language of the
report as my answer to this proposition :
" The labor employed in the actual production of the
precious metáis is both extremely well paid and very
productive. The average earnings of all persons employed
at the gold and silver mines during the year 1889 (57,635)
were $725 a year, while the average output per man amounted
to $1,723 a year. In the granite quarrying industry (taken
as an illustration of industries other than mining) the average
valué of the output per person employed in 1889 was $648,
and the average wages per annum $446."
However much we may criticise its enumeration of the inhabi-
tants of New York City, it must be admitted that so far as the gen
eral statistical work of the Census Bureau is concerned it has been
performed throughout the whole country with a rare degree of
fidelity and ability, and its official showing that mining pays
higher wages to the laborer and better profits to the emplóyer than

MINING FOR PROFIT.

any other business carried on in the United States, is respectfully
submitted, for the consideration of those who have so confidently
and persistently insisted that it was generally unprofitable.
How, then, is it you say that so many people have lost money in
mining ? Speak to the first man you meet about a mining enter-
prise, and ten to one he will begin to retail to you the story
of his losses. Upon the street or in the ordinary walks of life you
hear little of mining profits. The popular idea here in the East
seems to be that the business of mining is a vast maelstrom for-
ever swollen by the earnings and accumulations of the people
which are cast in and swept away year after year and decade after
decade as time goes on.
But investígate the matter a little deeper and you find that your
average citizen who thus complains about his mining losses will not
be able to stand a cross-examination upon the merits and demerits
of the particular mine or mines in which he made his investments.
He knows little or nothing about that subject. He has bought
a certifícate of stock upon the street and lost his money. Neither
he ñor anybody else seems to have paíd much attention to the con-
nection between that certifícate and any particular property which it
was supposed to represent. The principal part that the mine itself
appeared to play in the matter was to furnish a popular ñame
to the company or stock. The mining seems to have been done
mostly on Wall street, and this Icind of mining has been done inva
riable/ at a loss. But take the record, not of stock speculations,
but of actual working mines, and you reach a very different result.
The Calumet and Hecla, the Granite Mountain, the Ontario, the
Homestake — I might mention hundreds of others, large and small
situated in every part of this country and México — have not sim-
ply paid handsome profits, but have made their owners, and every
person with any considerable interest in them, rich. The Granite
Mountain alone, although yet in the infancy of its development,
has already brought into the City of St. Louis, where most of its
stockholders reside, more than ten millions of dollars, and returns
are still coming in at the rate of about two millions a year.

MININO FOR PROFIT.

Other large mines are doing just as well, and some of them
even better; while there are thousands of small properties, scat-
tered all through the mineral-bearing mountains of the continent
that are unknown outside of their immediate vicinity, do not figure
on the stock exchange, and are not talked of on the street, which
areyielding their owners every month very handsome returns, and
in the aggregate rolling up vast wealth for the country.
The sum of the whole matter is this : Speculation in this
country of late years has not been generally profitable ; mining, as
a business, has.
It isn't the speculator in mining stocks alone who has lost his
money, but the speculator in other securities as well. The rail-
road stock speculator has not fared any better. A trail of tribula-
tion has been left behind by Atchison, Union Pacific, Missouri
Pacific, Baltimore and Ohio, Richmond Terminal, and hundreds
of other railroad and kindred stocks, more terrible than any-
thing of the kind that has followed even the most reckless
speculation in mining shares. It was railroad and not mining
speculation that drove the young and plucky "Nervy" Evans
to a suicide's grave. It was not speculation in mining shares
that has so recently brought the f amily of our own heroic Cyrus W.
Field to sorrow. It is the railroad rather than the mining specu-
lators who have turned defaulters and who are filling our State's
Prisons. It was not mining speculation that broke the Barings,
carne near wrecking the Bank of England, and overwhelmed the
whole world with panic a year ago. The famous, or rather in-
famous, " Argentines," consisted of almost everything except
mining stocks.
Even the conservative investors in western farm mortgages
have not always had an altogether happy time.
This spirit of speculation which is abroad in the world has done
much evil, and Lombard street and Wall street have, in some
instances, dabbled in mining, but it has not been their favorite
field, and their greatest work of destruction has been done else-
where.

MINING FOR PR0FI7,

Mining, as a Wall street folly, has, to some extent, fared the fate
of its other follies. But it certainly has not represented its worst
phase or wrought its greatest ruin. Mining, as a business, during
the last ten years, if we may believe the figures of the United
States Census, has proved one of the most profitable of invest-
ments. Mining in México — The Past.
The volcanic mountain ridge, extending through substantially
the whole length of México, and forming the back-bone of that
part of the Continent, is the richest mining región in the world.
I quote the following from the official report on " México," by
the Bureau of American Republics, published in July, 1891,
Bulletin No. 9, page 69 :
" The Mexican Product of Precious Metals.
" It has been estimated that the annual output of silver from
" Mexican mines is now over $30,000,000, and the yield of other
" minerals amounts to fully $5,000,000 more. There are about
" 200,000 men employed in the more than a thousand mines now
" being worked in the Republic.
" The total gold and silver product of Mexican mines from 15 21
." to 1884 was : Gold, $276,970,173 ; silver, $3,570,370,247, making a
" total of $3,847,340,420.
" The yield for the fiscal year 1886- 87 was : Silver, $25,897,981.75 ;
" gold, $548,414.71 ; total, $26,446,396.46. The total exportof silver
"from México for the year ending June 30, 1889, was, in round
" numbers, $38,000,000. Since the discovery of America the mines
" of México have yielded nearly two-thirds of the silver product of
" the globe. The amount of capital invested in Mexican mines was
" estimated on Aúgust 15, 1890, to be $500,000,000, Mexican
" money. " The coinage of the mints since their establishment (1537) upto
" December 31, 1888, was as follows ;
"Gold  $122,751,291.29
"Silver  3,203,119,941.63
"Copper  6,400,214.58
"Total  $3,332,271,447.50."

MINING FOR PROFIT.

The mines of Guanajuato alone have yielded over eight hun-
dred millions. The Veta Grande vein at Zacatecas, about four
hundred millions. The mines at Tasco, in the State of Guerrero,
were being worked by the Aztecs when México was conquered by
the Spaniards, and have been worked ever since and show no
signs of exhaustion. Their total product cannot be given with ex-
actness, but it certainly goes up into very high figures.
Take out of the world the silver that has been produced from
the Sierras in México, and from the famous Potosí farther south,
and there would ¦ not be very much left. It was the producís of the
mines of México and Perú that supported the Spanish monarchy
and paid the expenses of the Spanish wars for a full century
and a half. Mining in México — The Future.
It has been under the most primitive system of mining that
México has done all this. The steam pump and the stamp mili
have been introduced into the country only in very recent years.
The oíd methods are still employed extensively in many places.
At Zacatecas, the Veta Grande vein is being worked by vaso fur-
naces and arrastras as of oíd. At Guanajuato the present pro-
cesses are not much, if any, better. It is only in the North, in
Chihuahua and Sonora, where the influence of our country is
most felt, that modern machinery has even yet made much
headway ; but wherever it has gone it has produced wonder
ful results. Under the oíd methcds mule-power was used to lift
the water and the ores were carried up in rawhide buckets on the
backs of peons climbing a notched pole. The methods of reduc-
tion were so crude that the loss was very great, and so slow
and expensive that nothing but the richest ores could be worked
at all. Under the new methods ten dollar ore can be worked
more profitably than hundred dollar ore under the oíd regime,
and ten dollars can be taken out now more easily and at less ex
pense than one dollar could then.

MINING FOR PROFIT.

The difference between the oíd and the new ways of mining in
the Sierras, in México, is as great as is the difference between our
modern spinning machinery and the hand-loom of our grand-
mothers. May we not fairly expect something like the same differ
ence in results ? The Place to Invest.
I am confronted every where, when I am preaching Santa Juliana
with the proposition, " If your mine were only in the United States,
if you were under the protection of the Stars and Stripes, you
would be all right," and I confess that I have often wished that the
treaty of Guadaloupe Hidalgo and the Gadsden Purchase had
placed the boundaries between the nations two hundred miles
farther south, so that Jesús María would be in our country. I
know how to defend the rights of person and property wherever
our flag floats. I am at home in any Court in the United States.
I understand our laws and our institutions, and I like our methods
best. But there is another side to the story. We are not alone in this
prejudice ín favor of our country. People seeking mining in-
vestments have sought for them in the United States until
most of the large and profitable mining properties here have been
taken up and are held at enormous figures. There may be more
Granite Mountains and Ontarios and Homestakes ; there may be
other Comstock lodes and Black Hills and Grass Valleys in our
own country, but they have yet to be discovered, and so diligent has
been the prospector in this country of ours, and 'so thorough his
work, that the field for future discovery is very much narrowed
and the chance of anything new that is very good, is somewhat
discouraging. México, however, until within a few years past, has been under
a cloud. The Spanish conquerors were plunderers. The Spanish
rule was a rule of plunder. It cost México years upon years
of war and the lives of her bravest and best people — the great
Hidalgo, their Washington, among them — to cast off the Spanish

MINING FOR PROFIT.

yoke. The rule of the Spaniard and the dominión of the Spanish
church was not an environment calculated to promote education or
todevelopacapacityforself-governmentamong the people, and it is
no wonder that after her successful war of independence México, with
her mixed population, with three hundred years of brutal and despotic
Spanish dominión behind her, stepping out into the world of nations
with her rude and mixed population, and without any experience
in self-government, should for a time be the home of revolution,
disorder and anarchy. It took her half a century of civil war to
establish peace and order, and it was not until that great nation-
builder, and friend and promoter of peace, Porfirio Diaz, became
President of the Republic, that she knew what a stable government
was. But the friends of México believe that she has now passed
the time of her tutelage ; that she has learned the great lesson that
every nation and every race has to learn, sooner or later, and always
at a terrible cost of blood and treasure, and that she has laid the
foundations of future peace and prosperity deep in the decades of
experience through which she has passed.
Meantime, and until the new order of things, México was not
a favorite field for investment. The best properties had difficulty
in finding purchasers. There was scarcely any market for any-
thing. Capital held aloof, talent kept away, and the development
of her great resources was in every way retarded. For half a cen
tury it may be said that México simply stood still.
The wise and prudent investor buys a thing when it is cheap
and makes the profit himself. If you invest in mining property in
the United States, you will have to pay a good price for it, and
some other fellow takes the profit. If you invest in México, you
invest at bottom figures, on a rising market, and make the profit
yourself. México to-day is the best ñ eldfor mining investment in the world.

MINING FOR PROFIT.

Jesús María.
Jesús Maria is, par excellence, a mining town ; it has no title to
existence otherwise. It is situated nearly at the top of the Sierras,.
two hundred and fifty miles from a railroad, and a hundred miles from
the nearest place to which a wheeled vehicle can be driven. Its agri-
cultural possibilities are solimited that Mr. Sexton, when he wanted
a garden, had to build it on the side of the mountain, and it wasn't
very much of a garden after it was built. For the farmer this coun
try about Jesús Maria, has but very little attraction, but to the geol-
ogist it is full of interest. In the process of world-making, as the
earth has cooled and grown smaller, the earth's crust has folded
and cracked everywhere more or less, but there are certain places
that seem to have been dynamic centres. It is at these centres,
where the terrific energies employed in world-making have been con-
centrated, that the greatest mines of the earth are found. Potosi is
one of them, and it has already yielded two thousand millions of
dollars. Our own Comstock is another, which, notwithstanding all
its sins, has been the most conspicuous among the recent causes
which have produced so many large fortunes in this country. In
Southern México, Tasco, Guanajuato and Zacatecas are such cen
tres, and each of them has already yielded to the primitive methods
of the oíd Mexicans hundreds of millions.
But nowhere on the face of the earth have these cosmical forces
left a more conspicuous record than at our own Jesús Maria. I
have at our office a mineral map of the district, showing the confor-
mation of the mineral veins in the country round about. It is a
wonderful showing. The veins, which represent the original fold-
ings and cracks in the earth's surface, cross, and run into one an
other in every direction, so that the mountain all around is a vast
network of mineral-bearing lodes.
I have never seen the Potosi district, but I am told that the coun
try about Jesús Maria strikingly resembles it ; the chief difference,
so far as practical mining is concerned, is in the altitude. Potosi,
although cióse to the Equator, is very near the line of perpetual

MINING FOR PROFIT.

snow, and work has to be suspended a considerable portion of the
year on account of the climate, while Jesús Maria has an altitude of
only about 5,500 feet and a charming climate all the year round.
If one stands on the edge of the cliff that overhangs Jesús
Maria to the east, and runs his eye over the mountain and valley in
front of him, he need not be a geologist or a mining expert to
understand that he is viewing the result of tremendous and ex-
ceptional dynamic agencies, while the trained, practical miner,
studying this network of metalliferous veins, discovers, even on the
surface, most convincing evidence of the riches that have been
found to lie so plentifully beneath.
Santa Juliana.
Santa Juliana is to Jesús Maria what the Veta Grande is to
Zacatecas and the Veta Madre to Guanajuato.
The yield of gold and silver in the Mexican Sierras in times past
has been principally in the southern part of them. This has been
so, not because the south part was in any wise the richest, but be-
cause México was settled from the South, and, until very recent
years, the mountains in the North were held in great measure by
the fierce and bloodthirsty Apaches and other wild Indian tribes, so
that their development was very difficult and attended with consid
erable danger.
This is our good fortune.
Tasco, Guanajuato and Zacatecas have yielded up a great part
of their wealth, while Jesús Maria has been to a much larger extent
spared. The Veta Grande and the Veta Madre have produced, the
one four hundred, and the other eight hundred millions of silver,
while Santa Juliana has lost not more than forty millions of hers.
If the conditions had been reversed, and the settlement of México
had been from- the North, Jesús Maria would have been reached
first, and Santa Juliana might have parted with the eight hundred
millions, and the Veta Madre with only the forty. As it is, the
other seven hundred and sixty millions that the oíd Mexicans were
unable to take out have been left for us.

MINING FOR PROFIT.

The Original Basis of Our Faith.
In a former paper I have told something of the story of Bethuel
Phelps, and his connection with Santa Juliana. In 1865, when in
California, Mr. Phelps met Matias Alsua, of Guaymas, Sonora.
Alsua had with him evidence showing the wonderful yield of Santa
Juliana, when it was worked between 1825 and 1836, and that the
Mexicans were in the richest part of the vein, when they were
drlven out by the inflow of water, which they could not, by any
engineering device then practicable in these mountains, control.
Bethuel Phelps was a keen, clear-headed, far-sighted business
man. He saw very clearly the forcé and effect of this evidence,
which Alsua presented. to him, and at once formed his plan of
action. Mr. Phelps was also a man of wonderful energy and
activity. With him, to think was to act. On the next steamer he
was a passenger for Guaymas. There he organized a little aimy
(the Apaches were so bad in these days that an armed forcé was
necessary in travelling anywhere in Northern Sonora or Chihuahua),
and marched up the Yaqui and Mayo canons, and after a long and
somewhat perilous journey, reached Jesús Maria. There he made '
a thorough study of Santa Juliana. He investigated very carefully
all the available evidence of what it had done, and examined, from
a miner's standpoint, the country round about it. He found that
both the ocular and the record evidence of its greatness and valué
were much stronger than anything that Alsua had shown him. But
he found also that he could not buy it. Poor as the people were,
who had the title to it, much as they wanted money, Santa Juliana
was the one thing they would not sell.
Mr. Phelps concealed his disappointment aud bided his time.
The story of how he occupied himself in getting options on the
other mines in that vicinity , went to France, organized a syndi-
cate with fifteen millions capital, and Louis Napoleón as a silent
partner, and how Maximilian was shot, and the French power carne
to an end before the matter could be consummated, I have told in
my annual report, published in April last. But not for one moment,

MINING FOR PR0F11.

while this French negotiation was going on, or afterwards, did Mr.
Phelps falter in his determination to finally become the owner of
Santa Juliana ; and when a man like Mr. Phelps wills a thing, he
usually, sooner or later, does it. But it was not until late in 1887,
after twenty-two years of patient, unrelenting effort, that he suc-
ceeded, and in the summer of 1888 he died, leaving to the writer of
this paper, who had been his friend and counsel during all the latter
years of his life, and whom he expected to be the attorney for his
estáte, the, task of carrying out the great and comprehensive plans
that he had formed for the working and development of this prop-
erty, which he spent his best years on earth in acquiring.
I have also written something heretofore of Don Carlos Conant,
the long-time, trusted friend and confidant, and the business asso-
ciate of Bethuel Phelps.
In Conant's veins the blood of the Puritan and the Spanish
Cavalier is mixed. He had a father from New Hampshire and a
mother from México. He was born and brought up in Guaymas,
Sonora, whieh, until the building of the Mexican Central Railroad,
was the market town for the Northern Sierras. Conant has as royal
a nature as any man I ever met. He had been a soldier under
Juárez and Diaz in the long struggle for the establishment of
good government in México, and had done a soldier's part, as he has
done every part that he has had to do in the world, well. There
never was a braver Englishman or a braver Spaniard than this man
who had the blood of both in his veins. In 1874, during a revolu-
tion in Sonora, he had been on the losing side; had been condemned
to death, and had escaped and fled into the mountains of Chihuaha.
Here, while a fugitive from his native State, he was employed by
some of the parties interested in the Santa Juliana property to
manage their interests, and he stayed several years in Jesús Maria,
having charge of the mine. It was while so occupied that he
became acquainted with Mr. Phelps, and he remained his steadfast
friend and coadjutor until Mr. Phelps' death, thirteen years later.
Conant's investigations in reference to Santa Juliana were even
more thorough and searching than those of Mr. Phelps, and he

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soon became convinced, as Mr. Phelps had been before him, of the
surpassing greatness and valué of the property.
Conant is now largely interested in the Santa Juliana Mining
Company, and is one of its best friends.
We have also a long list of the ñames of other people, living
and dead, who had shown their faith in Santa Juliana in various
ways before the present company was organized. Among these
are Manuel J. Vidal, Leonardo Siqueiros, Pedro Bustameñte, Señor
Coronado, a descendant of the great explorer, Judge Guyton,
of México, Juan Ramón Gutiérrez, Matías Alsua, of Guaymas, of
whom I have already spoken; Bezaleel Sexton, A. Willard, Charles
E. Phelps and our own Thomas B. Sexton.
What was it that led such men as Bethuel Phelps and Carlos
Conant to spend so much of their lives and fortunes in the effort
to obtain the title to Santa Juliana, and in the work of its proposed
régeneration? And what was it that induced these other sagacious
and clear-headed business men of both nations to have so much
faith in the exceeding valué of the property?
I will give you a little summary of the evidence on which they
acted, and which seemed to be so convincing to their minds.
Santa Juliana was not historically unknown. In Ward's History
of México, Vol. II., page 553, this account is given (Mr. Ward
acquired a large part of the materials for his history while acting
as British Minister in México, between 1825 and 1827, when Santa
Juliana was in her pristine glory):
" Upon the western discharge of the Sierra Madres is the cele-
" brated and recently discovered district of Jesús Maria, where
" upwards of two hundred metallic lodes were registered in one
" year, within a circle of three leagues in diameter. * * * *
" The deepest mine so far, the Santa Juliana, is not more than
" seventy yards, but it has produced ores so rich that they have
"been carried to Chihuahua, 50 leagues, andto Parral, 130 leagues,
" to be reduced, there not being any reduction works on the spot
"when the bonanza commenced."
In the first volume of the journal of the Royal Geographi-

MINING FOR PROFIT. 13
cal Society of 1860, Mr. Charles Sevin, F. R. G. S., who had been
sent from England in 1856 to examine and report upon the min
eral wealth of Northern México, says:
" The above mentioned famous mining place, Jesús Maria, is
" a town in the Sierra Madres, on the head waters of the Mayo
" River, and near the frontier of the States of Chihuahua and So-
" ñora. Immense wealth was extracted from the mines in its
" neighborhood at the time of the Spaniards. Its silver ores
" always contained gold in a sufficient ratio to make the mark (8
" ounces) of bullion worth ten dollars and upwards. The chief
" mine of Jesús Maria, however, which is the Santa Juliana, has
" been worked more extensively than any other in that section of
" the country. This mine is 278 yards deep, and is now filled with
" water. The ores have proved never to contain less than 3 marks, or
" 24 ounces of silver, and have even reached 40 marks or 320 ounces
" in one cargo of 300 pounds. To clear this mine of its water,
" power would be necessary, and it may be observed here, that
" there is no want of fuel at Jesús Maria, all the mountains of the
" Sierra Madres being covered with timber."
Other historical works give similar accounts, more or less full.
Don Mariana de Valoir, a gentleman of the highest respecta-
bility, who at one time lived in Jesús Maria, and had thoroughly
investigated the mineral wealth of the country about there, gave
evidence, as follows, near the cióse of his life, about 1840 :
" In the year 1825 a class of ore was found in Santa Juliana,
" called ' Aremillas,' abounding in loóse grains of native silver ; and
" shortly after the blue ore was struck, which kept on increasing in
" richness with the greater depth of the mine. The product of the
" ores was as follows :
" The class called chuque paid 60 to 180 marks per 300 lbs.
" At $10 per mark, these ores would represent, per ton, $4,000 to
" $12,000. " The class called ist paid, 70 to 75 marks per 300 lbs.
"At $10 per mark, these ores would represent, per ton, $4,600
" to $5,000.
" The class called 2d paid, 24 to 30 marks per 300 lbs.
"At $10 per mark, these ores would represent, per ton, $1,600
"to $3,100. '
" The class called 3d paid, 6 to 10 marks per 300 lbs.
" At $10 per mark, these ores would represent, per ton, $400 to
" $666.

14 MINING FOR PROFIT
" The class called ore dirt paid 5 to 6 marks per 300 lbs.
"At $10 per mark, these ores would represent, per ton, $330 to
" $400. " But the valué of the mark was estimated, in the time of the
" bonanza, at $30 and upward.
"So that the different classes of ore .paid from $330^0 $12,000
" per ton of 2,000 pounds.
" In the part called Compromiso were stretches of ore still
" richer. In the main shaft, which was opened for the extraction
" of the ores, rubbish and water, two pillars were worked, called
" San Pedro and San Joaquín, which were each valued at $1,000,000,
" their dimensions being 30 feet in length, 21 feet in depth, and 12
" to 15 feet in width between vein walls. Their wealth consisted
" in the abundance of the ore called chuque, which yielded from
"180 to 216 marks per 300 pounds load, equivalent, at $10 per
" mark, to from $12,000 to $14,400 per ton. In some stretches the
" ore was very much charged with native silver mixed with gold,
" each mark of which bullion was worth from $25 to $35. The
" ' Compromiso ' and Santa Juliana produced the greatest results
" in a horizontal stretch of 90 to 105 feet.
" The ' Compromiso ' part of the ledge, however, has been
" worked a length of 210 feet, and to a depth of about 600 feet in
" one shaft, but generally to a depth of 300 feet, and yielded gen-
" erally ores which paid from 12 ounces to 3 marks per 300 pounds
" load, equal to from $100 to $200 per ton of 2,000 pounds.
" Santa Juliana has been worked 75 yards in a northerly direc-
" tion, it being to the north of Compromiso, at which distance an-
" other vein, called the ' Ronquillo,' crosses it. This vein is very
" large, but has only been tested near to the surface, and appears
" of irregular formation. The works of Compromiso are those
" which will be first come at in the draining of the mine, and the
" ledge there remains in ores yielding from 1 2 ounces to 2 marks for
" 500 pounds load, equal to $100 to $120 per ton of 2,000 pounds.
" In Santa Juliana, from 360 feet depth to the bottom of the
" works, the ores paid generally from $200 to $300 per ton. In
" these ores the ledge continúes. The width of the ledge was gen-
" erally 4^ feet — seldom narrower, — and sometimes as wide as 12
" feet and more. The bottom of the different shafts are all still in
" good ores.
"Ini83i I had occasion to register officially the books of Ad-
" ministration of Rentes of the State of Chihuahua, and I found
" there that the producís of Jesús Maria, from 1826 to 1829,

MINING FOR PROFIT. i¡

" reached, in siver and some gold, the sum of $11,000,000. Of this
" amount abouí one-eighth was from the many different mines then
" worked, and $9,625,000 was from Santa Juliana and Compromiso.
" From 1835 to 1836 I was 'aviador' for one of the owners- Ac-
" cording lo my accouní-books, Sania Juliana and Compromiso
" produced, from 1830 lo 1836 (when íhe business was stopped),
" 67,000 to 68,000 marks — in seven years, 467,000 marks of silver,
" of the valué of $5,236,000; so that the yiéld, from 1826 to 1836, is
" proved to have been $14,861,000. A very considerable poríion of
" the proceeds of Santa Juliana and Compromiso went to Sonora
" and other parts wilhout being officially assayed and registered —
" in fact, they were smuggled. There is no account of them ; but
" I do not think that they amounted to less than $7,000,000. Cer-
" lainly $20,000,000 may be calculated as the total proceeds of the
" operation." Don Pedro Bustamente, who was a thorough miner, and had
had for a long time charge of the work in Santa Juliana about the
same time, says:
" Wilh our one interior mulé whim we were barely able to
" extract the water and íhe best of íhe ore, leaving in the mine, as
" filling, all the ore which did not go over two or íhree marks ($100
" lo $160 per ton) per cargo of 300 pounds."
And although he was a man of considerable property at the
time of making these assertions, he added, " that he would not fear
" to guarantee all that he possessed thal from the fillings (waste) alone
" could be exíracled sufficient ore to cover all íhe expendiíure of
" reopening the mine, let the cost be what it may, and this without
" striking one single blow in solid ground."
Hon. Manuel J. Vidal, who was for many years superintendent
of the Mint in Chihuahua, writes, in 1875, ío Don Carlos Conant,
as follows: "Chihuahua, Sept 14Ü1, 1875.
" Señor Don Carlos Conant,
"DearSir: Together with your esteemed favor dated ioth of
" the present monlh, I received also íhaí of my esteemed friend,
" Don Juan Ramón Gutiérrez. I regret beyond measure my ina-
" bility to furnish the precious map of Sta. Juliana, made by the
"Señor Petlers, and íhe descriplive leller of Don Leonardo
" Siqueiros.

i6 MINING FOR PROFIT.

"' I am enlirely ignoraní where íhey may be, although they are
" well known by the Señor Gulierrez and myself ; buí I well re-
'• member íhe essential points in íhem. The map presented a per-
" pendicular work of about 300 ' varas' (a ' vara' is nearly equal ío
" one yard) in depth from the patio of the mine, and of about 30
" varas in length from north to south, where the ruined walls of
" masonry on the surface are still to be seen. By this letíer, and
" other informalion derived from actual parlners in íhe mine, it ap-
" pears thaí íhe boílom of íhe mine,' in ils lenglh of 45 varas, has
•' average meláis of from 3 lo 5 marks to the ' carga ' of 300 pounds,
" with a valué of ten dollars per mark and upwards, and also has
" íhreads of ' chuque ' (sulphide of silver) exíremely rich. From
'• manifold accounts, and all worthy of belief, we know that from
'• 1825 to 1835 the famous Santa Juliana produced in the lower
" levéis, in a depth of about two hundred varas by 30 varas in
" length, the enormous sum of 35 millions of dollars; and estima-
" ting íhe average widlh of the vein as four varas, it produced from
" the 24,000 cubic varas $1,458 per cubic vara, riches solely to be
" compared with that of 'Potosi.' I am very glad thaí Ihe Señor
" Don Matias Alsua has resolved to begin the work of placing a
" mine of such magnificent precedenís again in a producing state,
" and I trust thaí his efforts will be crowned with the success which
" they deserve. Many have wished to do this, but in face of the
" large and indispensable advances required, they have been obliged
" to reí iré.
" I embrace íhis opporlunily to offer myself as ever .your affec-
" íionaíe friend and humble servan!,
"MANUAL J. VIDAL."
Manual Chares, in 1872, in apublic proceeding in Jesús Maria,
lesíifies as follows:
"That he is seveníy-two years of age. That he was born in
Durango, México, and is a miner by profession. That he never
¦ worked in the interior of the mine Santa Juliana, but thaí whal he
" did was ío reduce dirl from íhe wasle dump, which produced
"him from 6 ío 7 marks for six 'cargas' (1800 pounds); íhaí he
"worked íhis dirí for fourleen years, firsl in 'arastras' moved by
" water, which are still in the possession of Don Refuge's Quintana,
" and aflerward he worked íhem in a waíer power of two arratsras.
" These dirís were from the dump cast away by íhe owners of íhe
" mine. Thaí he ground íhem wilhouí sorling, íaking everything

MINING FOR PROFIT. 17
" excepí íhe large rock. That when the mine was abandoned it
"was left in meláis, and the cause of the abandonmenl was íhe
" abundance of water.
In the same proceeding, José Maria Juárez, testified as follows:
" That he is fifty-nine years of age, born in Cusihuriachic, mar-
" ried and resident in this mineral since the discovery of Santa Ju-
" liana. Thaí the mine was left in metáis. That the cause of the
" abandonment was the water. That from the Purísima downward
" the foolway is beíween íhe side walls of Sania Juliana and Com-
" promiso shafís to the San Juan shaft. That the Pillar of the
" Crosses can be worked, being very large and nearest lo íhe
" bottom. The second pillar is on the level of San Abran, which is
" equally large, and can also be worked. Both íhese pillars are
'• very rich, and are siíuated from the shaft of San Juan upward.
" That the third pillar is Sanio Domingo, and was noí taken out
" and can also be worked and is above the level of San Abran.
" That in the oíd powder or hanging wall of Santa Inez there is a
" large shell (concha) of metal of about two varas thickness exceed-
" ingly rich. Thaí it is not covered. Here his companion Dionisio
" was killed and left, and íhat he also fell, but foríunaíely caught
" on and saved himself. That íhey were then removing pillars by
" order of Don Leonardo Siqueiros. That all íhe work done in the
" shell (concha) was by Villabos, Alexandro Marungo, Victoriano
" Arroyoso and himself. Thaí íhey did not take it all out because
" the now defunct José Maria Velasquez fired off a blast above in
" San Miguel, against the timber of the shaft, which fell and
" covered them up in Santa Inez. This made them afraid, and they
" did not go in again. That this shell had metal which gave as
" high as 18 marks to the (arroba) 25 pounds (valuing íhe mark at
" $10 this would represent $14,400 per ton of 2,000 pounds) of ore
" and plenty of (azogues) average rock íhat will give more íhan íhe
" besl metáis extracted from mines in these days. That from San
" Miguel toward íhe souíh íhere is a greal quaníity of ore, also in
" San Coronado and íhe same wilh íhe levéis of Purísima and Ani-
" mas, which lasí lwo are íhe upper levéis, and are beíween íhe
" Sania Juliana and Compromiso shafís. That Don Leonardo Si-
" queiros, in his last attempt to free the mine from water, did not
" reach the botlom. Thaí he wishes lo add íhaí when he fell, Don
" Pedro Bustamenle, the mining overseer and all his men were
" digging at the crosses to escape from the mine. That this is the
" state of the mine from the shaft of San Juan upward, where
" there are some places depillared and fallen, but that from the

18 MINING FOR PROFIT.
" shafí of San Juan downward, íhere can be worked as many
" places as may be wished, all in firm ground and in good meláis.
" Thaí he worked in the mine nine years, and until the last day it
"was worked."
Francisco Rodríguez íesíified in the same proceeding, as fol
lows: " That he is fifty-six years of age. Was born in íhe valley of San
" Bartolo, and resident of this mineral since 1824. That he worked
" in íhe Santa Juliana mine since the year 1829. That the first Su-
" perintendent was Don Juan Bernardo Alverena. After his death
" Don Juan Luis de Arronstre, who conlinued for four years, and
" succeedinghim íhe citizen Francisco Armendaris, who had charge
" for lwo years, and after him Don Leonardo Siqueiros, who
" did the last work. That Don Leonardo worked one season, dis-
" continued taking out íhe waler, and when aflerward he en-
" deavored lo exlract it and reach the bottom he fáiled to do so,
" because of a disease which broke out among his mules, leaving
" him barely suíficient to work íhe interior mulé whim. That he
" therefore determined to work out the pillars where he could, as
" the water was raising. That he ordered Don Pedro Bustamente
" and Velasquez ío work up from íhe Santa Inez pillar, taking out
" what they could. Don Pedro Buslamente, Alexandro Míreles,
" Viceníi Dominquez, Marcelino Maquellanes, José Mará Juárez,
" Yreneo Outiveras and José Maria Valenzuela were íhe last who
" worked in Compromiso, belonging to Santa Juliana, to which
" place íhe waíer had risen, and since continuing lo ils present
" level. That the botlom is in metal; that the lode which forms íhe
" width of the work is a body formed by veins of ore from one
" span to a vara wide, being quite soft; that in the southern parí of
" íhe work is a soft and red looking vein, and against íhis is a
" slreak of very rich ore aboul íhree spans wide, íhis being the
" landing of the San Juan whim; íhaí all this he has seen, because
" he took waler on his shifl, and washed the vein so as to see it
" well, being interested in iaking ouí a specimen now and íhen.
" Thaí íhere exists a (labor) working of San Felipe belonging to
" Compromiso thaí in ils boííom carries about one foot widlh of
" rich metal; thaí íhis place was worked by Don Juan Luis de Ar-
" rouslre, and íhat he said that this ore gave 25 marks; estimaíing
" íhe mark al $10, this represents over $500 per ton, to three cargos
" (900 pounds), by patio process; thaí from íhere upwards, in Sanio
" Domingo, which is a level, also San Abran the same; also the Cor-

MINING FOR PROHIT. 19

" azon de Juan íhe same; also Santa Inez the same, and in which
" last Juárez carne near being killed. That íhere are large fillings
" in the mine. The first Santa Inez, the second Anacleto, the third
" San Coronado, the fourth lower San Pedro, the fifth upper San
" Pedro. That all these places are filled with ores profitable lo
" work, and in San Felipe a new mine can be opened and worked
" downward lo San Juan with 25 or 30 drillers, and that in all.
" places which he has mentioned there are ore metáis more or less
" rich and abundant."
José María Coronado testified in the same proceeding, as fol
lows: " That he was the last who worked the ores from Santa Juliana,
" and that he noticed in the botlom thaí íhe sulphide of silver had
" diminished, bul in exchange íhe azogues (average ores) had in-
" creased in quantity and valué. That the mine was only partially
" depillared, as it could not be done on accounl of water, which
" caused much disorder and confusión, wilhoul giving lime lo at-
" tempt any formal work. In every part of the mine, following the
" vein in every direction, there exist good metal in sight; and
" he feels confidenl íhat this condition will continué below the
" works, and even improve, as íhe walls are firm and íhe vein
" very formal. That he firmly believes thaí from íhe fillings alone
" can be íaken a large foríune, sufficient to cover íhe cosí of re-
" opening íhe mine many íimes."
The direcí evidence of íhese wilnesses leaves in doubí only íhe
queslion of íhe amounl of bullion which íhe mine yielded between
1825 and 1836. The lowesl esíimaíe is íwenly and íhe highest
thirty-five millions. The difference in íhese esiimaíes is caused by
the fací thaí the Government imposed a heavy tax upon bullion and
there was a great deal of smuggling done to avoid this tax. It is
easy to get the record of the amounts on which the tax was aclually
paid, bul íhe amount smuggled can be only. reached by approxima-
tion The more recent calculations of the most careful investiga-
tors, based upon evidence lalely obtained, seem to indícate that the
larger estímales are nearer the truth than the smaller. It is now
believed by many that the actual production was nearer forty mil
lions than thirty. I am quite willíng, however, to take the lower
figures, for whatever was not taken out is left for us.

MINING FOR PROFIT.

But the direct testimony of these living witnesses as to the rich-
ness and valué of Sania Juliana was by no means the most convinc-
ing evidence which we had.
When the mine was worked in the '20's and '30's, there
was not a railroad in México or a waggon road within two hundred
and fifty miles of the property. The only way to get íhere was over
an almost impassable mule-lrail through íhe narrow canons of íhe
Mayo, and over íhe worst peaks of the Sierras, from the Pacific
Coast up. It was in a country in which agriculture was absolutely
impossible. Every particle of food and clothing, every household
utensil, every piece of machinery, and all the materials used in the
reduction of íhe ores, had to be transporíed over this terrible trail,
on the backs of mules, at enormous expense; and yet, despile all
the discouragements of its environment, a city grew up around
Santa Juliana of fourteen thousand people, the largesl lown except'
the City of Chihuahua, in íhe Stale. You may sland to-day at the
mouth of the Ronquillo shaft and see the ruins of this city around
you. It was not only a city containing so many souls, but notwilh-
standing iís isolalion, ií. was a lown of greal weallh and of consider
able culture and enlightenmení. Ils public buildings were by no
means conlemplible. Ií had paved and graded streets, expensive
bridges. and miles of walls of masonry along the mountain sides.
And Santa Juliana did it. The yield of all the other mines in
the district put logether was not more than one-tenth of the
product of Santa Juliana alone. The visitor there to-day can see with
his own eyes conclusive evidence of all íhat has been ever claimed
for oíd Santa Juliana.. Did The Mexicans Take it All?
The objection, which in the early days of our síruggle for Sania
Juliana we mosl frequently met with, was that the Mexicans topk it
all. "You prove too much," the objectors said, ".you show us
very clearly íhat the mine yielded trem endously in íhe oíd times,
and does it notfollow, therefore, thaí there is litíle or noíhing lefí?

MINING FOR PBOFIT.

Why don'l you bring us a new and fresh mine, and let us have all that
there ever was instead of what the Mexicans were kind enough to
leave us after they had got what they could out of it?"
I have no doubt íhat I have spent, in íhe aggregaíe, íhousands
of hours of my time, during the last four years, in convincing in-
lelligenl but cautious men that there was no forcé in íhis objeclion.
I have spoken in anolher place of íhe crude and primiíive man-
ner in which the oíd Mexicans worked. This crudeness and primi-
liveness was emphasized in Sania Juliana by ils disíance from any
base of supplies and by íhe extraordinary difficulties of transporta-
tion. Water was encountered in the mine in considerable quanti-
ties at a deplh of one hundred and eighíy feeí from íhe surface.
This was al firsl bailed out with pails. After a while, as the march
of improvement wenl on, pumps were rñade by boring a hole
through a log, inserting a wooden pistón, and connecting it with a
treadmill worked by mule-power. This was the greatest advance
they ever made in machinery. Even a windlass was beyond them,
and they never got so far as a ladder. The metal here, as in most
mines in México at thaí lime, was íaken to the surface in rawhide
buckets strapped ío íhe backs of peons, who climbed a pole with
notches cut in each side for the foot. In this way íhey sunk eight
hundred and íhirly feeí, carrying the jjores all íhaí disíance to the
surface, and lifting íhe waíer six hundred and fifíy feet to the drain
tunnel. The nearest approach íhey had ío machinery for íhe re-
duclion of íhe ores was the arastra, a cul of which is conlained in
my last report. A pair of mules dragged a big slone over íhe
ores, and, by palience and perseverance, íhe rock was finally pulver-
ized — afíer a fashion. The ores íhat had to be smelted were worked
in little vaso furnaces, where three or four men could, by hard
labor, dispose of íwo or íhree hundred pounds a day. The lowest
estímale I have ever seen of the cost of mining and reducing these
ores in íhis way was a hundred dollars a ton; consequently, no rock
was taken out, if ií could be avoided, which did noí yield consider-
ably more íhan a hundred dollars a Ion; and where ií was neces-

MINING FOR PROFIT.

sary lo íake out the poorer ores in order to get at the richer, every-
thing less than a hundred dollars a ton was thrown aside as waste.
We can work len dollar ores now at a greater percentage of
profit than they could one hundred and fifty dollar ores then.
The mass of the ore in any great mine is of comparatively low
grade, and any large mining enterprise must calcúlate on making its
profit in reducing large amounts of these ordinary ores at a small
cost. In any mine of any considerable size, the amount of metal
which can be extracted from ores yielding less than a hundred
dollars a ton is much greater than thaí which can be ob-
lained from ores of a higher grade, and, in íhe long run, a beííer
resull is obtained from working large quantilies of ordinary ores
íhan small quaníilies of íhe very rich rock. Bul íhe Mexicans,
with their machinery and íheir methods, could only work that
which was very rich, and even in that part of the mine to which
their operalions were confined, íhey had ío leave all ordinary ores
for us who come afler íhem. We see, therefore, thaí íhere is nolh-
ing at all improbable in Don Pedro Bustamenle's slalemenl, on the
trulh of which he was willíng to stake his fortune, " That from the
fillings alone could be extracíed sufficienl ore ío cover all íhe ex-
pendilure of reopening íhe mine, leí íhe cosí be whal ií may, with-
ouí síiking one single blow in solid ground."
The Mexicans, wilh íhis primitive method of íheirs, were able
lo go down only eighl hundred and thirty feet. Mule-power and
wooden pumps could not lift the water from a greater depth, no
matter how much the richness of íhe ore mighl lempl them to do
their utmost. The direct and posilive evidence which we have
shows íhat íhe mine held out in richness as far as they went down,
and al íhe bottom the ore was as rich as it had ever been any-
where. The indirect or inferential evidence is even more con-
vincing. The Mexicans never do dead work. They will follow a
streak of pay ore like a sleuth hound, bul íhere they síop. They
do not work now in the hope of future reward, and the fact that
these Mexicans, under such great disadvantages, and al íhis terri
ble cost sunk their shaft eight hundred and thiríy feeí in deplh

MINING FOR PROFIT. 23
speaks more eloquently than the testimony of any living wit-
nesses could, as to the valué of the mine all the way down.
With our machinery, we can sink easily at least twenty-five
hundred feet lower than íhe Mexicans ever worked. We have lefl
certainly three times as much in depth to work as they had, and
there is every reason to believe íhat the ore will continué in its
richness all the way down. I know of no record in history of a
mine which was rich for eight hundred feet in depth and then gave
oul. Superficial deposits of metal are sometimes found which are
soon exhausted, bul there never yet has been known a bottom to a
strong fissure vein like this which held out so long.
The work of the Mexicans was confined lo less than onelhousand
feet in length upon the Santa Juliana vein. The property to the South
of them, now belonging to us, was then owned and worked by the
Ronquillo Company, and the Santa Juliana owners could not touch
it. The property to the north of them, which now constiluíes our
Rincón claim and Walerson División, they did not own. We have
approximately a mile in lengíh,' with considerable development
throughout íhe whole exlení, every fooí of which may be jusl as
good as any fooí of íhat part which they worked.
We may be pretly sure íhaí íhe Mexicans did not take it all.
Recent Confirmations of Our Faith.
There is nothing like an ocular demonstration. Our judgmenl
may be convinced by reason, bul our nervous sysíem responds besí
to sight. Reasoning may cause a thing to be accepted, but seeing
is believing. When we síarted we had abundance of external evidence and
pleníy of logic ío jusíify our faiíh.
t
Now we have more.
We have sunk a shafí in íhe solid rock, by íhe side of the Santa
Juliana vein, nine hundred and twelve feet in depth. We have
drained and to a considerable exíent explored, the oíd Sania Juliana

24 MINING FOR PROFIT.
mine to a depth of eight hundred feet. At every point we have found
the oíd maps and the oíd records and the evidence of these wit-
nesses I have quoted lo be in every résped true. The maps were
so accurate thaí our engineers use íhem confidently in making
their working plana Bodies of ore have been found wherever we
have been told to look for them and the yield, so far as we have
been able to work them, has been fully as good as we had been led
to expect. In all the evidence which we had of the richness, extent and valué
of the Santa Juliana property, we have not discovered a single falsehood
or even an exaggeration.
More íhan all this; from a little spot in the soulhern parí of the
oíd works, where we have been able to get in, we have laken ouí
the waste which íhe Mexicans íhrew away, mixed wilh mud and
debris from íhe surface, and from íhis, our little mili has given us
two hundred thousand dollars in bullion, al a very handsome
profit, and is giving us regularly about ten íhousand dollars a
monlh. Some monlhs, when we have been able ío geí hold of a
little solid ore, or to get into a part of the mine where the waste was
a litíle richer, it has gone as high as twenly íhousand dollars.
This amouní, allhough we have found ií quile accepíable,
is not so very much or so very important in itself; bul as
an earnesí of what we may fairly expect when we get into
virgin ground and the mine begins to be opened up in all iís
length and depth, it is very eloquent.
What chance would any of us have of escaping conviction if he
were on trial for his life, and the evidence against him were half as
strong as the evidence of the remaining wealth in Santa Juliana ?
The Present Condition of the Work.
The Ronquillo shaft is now down 912 feet, and a drift is being
run from it ío cul íhe Sania Juliana vein below everyíhing. Wilhin,
say two months' lime we shall be in virgin Santa Juliana, and it will

MINING FOR PROFIT. 25
nol be long after that before we can supply the larger mili we are
building, as well as the Waterson mili we have bought, wiíh virgin
metal instead of running it on íhe waste and refuse which we are
now working in the small mili.
The water has been drained to íhe 800 fooí level, which is with-
in thiríy or forty feet of the bollom of íhe lowest depths of íhe oíd
mine. Ai íhe time of my last report we conlemplated enlering íhe oíd
mine from above, after we had drained off the water, and then
working down. This we have been able lo do in the south part of
the mine only. In the north part, we find the condition of the oíd
works to be such that it will be practicable towork them only from
the botlom upwards, and we have to postpone our exploration here
until we cut the vein below. This north part of the mine is where the
oíd workingswere the deepest. We had calculated on finding those
works either empty or full of debris. They were neither. It seems
thaí huge platforms of timber had been conslrucled, on which
íhe miners worked, and íhese plaíforms are covered wiíh debris
and waste, and are in all stages of decay. What seems at first sight
to be solid ground really rests on íhese rollen supports, a founda-
tion altogether too dangerous to work upon. Former estimates of
time and of cost, based upon the supposilion íhaí we could gel inlo
íhe San Juan shafí from íhe lop insíead of being obliged lo enter
it from the bottom, are therefore somewhat faulty. Ií seems now
that we shall have to wail uníil we can cul íhe vein below or eníer
from íhe boílom before we shall get any return from íhis part of
the mine. The work to reach this point is being pushed with the
supreme energy of Mr. Sexton, and with all íhe resources al our
command, and íhe day of our delíverance cannot be many months
off. Meanwhile, in the south part of the mine, we are taking ouí
and milling the waste, and sinking and drifling in íhe solid melal
which has recently been found in such abundance at the bottom,
and from here we are getting enough to supply the small mili, and
if there should be any delay in getling inlo íhe north part of the
mine, which we do not anticípate, we shall probably have this part

26 MINING FOR PROFIT.
of íhe mine in a posilion lo supply the large mili as soon as it is
ready. The mine will be self-sustaining and dividend-paying as
soon as we can supply even the small mili with the rich ores which
we have every reason to expect in the new ground which we shall
soon cuí, under íhe San Juan shafí ; or without this, as soon as we
can get the larger mili up and the south part of the mine opened
enough so thaí we can supply ií from the great abundance of good
and profitable ores which we have found íhere.
We are aclually running now a mili of ten slamps. A Hunting-
lon mili has been pul in, which is the equivalent of five stamps more,
and will add materially lo our fuíure production. Then we have
ten more stamps and a new engine and boiler in process of erec-
tion, and we are making connections wiíh our Walerson mili of
nine slamps, so íhat we can run these also on Santa Juliana ores.
This will give us, wilhin a few months, the equivalent of thirly-four
stamps, and we shall be able to work from sixty to seventy-five tons
a day. Even on the poorest of íhe oíd refuse, such as we have been
working, because it was in the way and had to be moved whether
we worked it or noí, we shall have íhen a producí of someíhing
over a thousand dollars a day. When we get far enough into the
virgin ore underneath us, so that all the reduction plañí can be
kept running on this, Mr. Sexton estimates that we shall produce a
hundred thousand dollars a month.
I do not expect the production to be very much increased be-
yond íhis figure excepl as íhe resull of one or both of íhe following
causes. First. — By íhe increase of íhe milling plañí. As soon
as we geí a little farther on and see our way a litíle clearer,
we shall undoubíedly add, from lime lo time, to the mili
plant, and so, increase the production proportionately. I
have síudied the history of Santa Juliana with a great deal of
care, and I have investigated from the standpoint of a prac-
tical business man, rather than thaí of the expert miner, íhe condi-
tions and production of other mines, as well as closely following
the evidence, which we, from time to time discover as the work

MINING FOR PROFIT. 27
goes on, of what Santa Juliana can do in the future. I am con-
vinced, and many men more able to form a solid judgment on min
ing matters than I am agree with me, that when Santa Juliana is
fully opened and developed, it can supply all the stamps or reduc-
tion plant that we choose to put up, and I shall not be contenled
until we have at least one hundred slamps running every day in
the year.
This cannot be done all al once, but if the enterprise can make
as good progress in the future as it has in the past, and if our faith
meets with confirmation hereafler as ií has herelofore, íhe first
of July, 1892, ought to see us producing a very nice surplus
every month ; íhe firsl of January, 1893, ought to see us pay-
ing handsome dividends ; and in the early parí of 1894, the one
hundred slamps should be running, and Sania Juliana numbered
among the large silver producers of the world.
Second. — By the discovery of more deposits of chuque. Chuque
is the Mexican ñame for what we cali the black sulphurel of silver,
and is the ore for which Santa Juliana has been so famous. In its
puré staíe, ií is one-half silver, yielding aboul $8 a pound, coinage
valué. The largest and most valuable deposits of this ever found,
in any one place in the world, were found in the Santa Juliana
mine, near íhe Ronquillo vein. From one pillar alone in íwo
weeks more íhan a million" dollars was taken out. Some of this
was found in the very lowesl deplhs of íhe mine, and íhere is no
reason whalever why ií should not occur below eight hundred and
íhirly feeí as freely as above ií. It has been a popular theory íhat
the chuque in Santa Juliana all lies near íhe crossing of íhe Ron
quillo vein; íhaí is, in íhe norlh part of the works, but recently
Mr. Sexlon, in coníinuing the explorations to íhe souíh, has come
across small deposils of it, and one day took out a hundred pounds
in a lump, and it looks as if we mighí have ií in the south as well
as in íhe north. Ií is usual in mining counlries, where íhere is a
well developed inlerlocking syslem of melallic veins, such as we
have in Jesús Maria, lo find íhe richesl deposits near where one

28 MINING FOR PROFIT.
vein crosses another. But Ronquillo is not the only vein which
we have that crosses Santa Juliana. There is a small vein, the San
Felipe, which crosses ií near where Sexton found this hundred
pound chunk of chuque, and there is the Rincón, a large vein that
crosses it still farther south, and íhen íhere is Guadaloupe, which
crosses ií on the Waterson dvision ío íhe noríh. None of íhese
crossings have been explored ío any considerable deplh excepí íhe
crossing of Ronquillo wiíh Santa Juliana, and íhaí only lo íhe
depth of 830 feet. Chuque is so rich that if found in considerable
quantilies we should noí work it in the mili, but ship ií in iís na-
live síaíe and sell ií lo íhe smellers. Whalever of íhis we find
will noí iníerfere al all wiíh the working of the mili on íhe ordi
nary ores, and will be so much clear gain. If we should find it
below eight hundred and thirly feeí as the Mexicans found ií
above, and if ií should oceur in like quaníilies at the crossing of
San Felipe and Rincón and Guadaloupe as it has been found at
the crossing of Ronquillo, Guanajuato and Polosi will have lo take
second place and Santa Juliana lead the list of the silver producers
of the world. The Assets of the Santa Juliana Company.
In my Annual Report, April 22d last, I síated these to consist
as follows: " 1. The Santa Juliana claim, as located by Phelps and Conaní
in 1886, comprising íhe four anciení mines of Sania Juliana, Com
promiso, Providencia and Rincón.
2. The Ronquillo claim, localed by Sexton 1887, and upon which
the shaft is being sunk.
3. The Guadaloupe mili site, with the íen stamp mili in opera-
tion, and the equivalent of fifteen more slamps being erecled.
4. Other improved real estaíe al Guadaloupe - and in Jesús
Maria, consisling of several houses, &c, well rented and paying a
handsome income on the investment.
5. The machinery used in the mine, and in the sinking of the
shafí. 6. A half interest in íhe Waterson mine, being a contiñuation
of the Sania Juliana vein lo the north.

MINING FOR PROFIT. 29
7. The Waterson mili of nine stamps, with steam and water
power, &c.
8. The Santa Niño tunnel on the continuation of the Ronquillo
vein on the west side of the creek, giving us, under the tunnel
contracts, one-half interest in íhe Santo Niño mine, and a two-
thirds inleresí in íhe Balvanera.
9. About 40,000 acres of woodland, mostly in heavy limber,
stretching from Jesús Maria lo Bassaseachic Falls.
10. The Bassaseachic Falls property, consisting of the Falls
themselves, and abouí 2,000 acres of land around íhem.
11. A conlrolling iníerest in the mines Veta Grande, San Matías
and San Nicandro, situated at Pinos Altos, near the mines of
the Pinos Altos Bullion Company.
12. A large interesí in íhe La Cruz properties situaíed al Los
Olates, about 20 miles to the northwest of Jesús Maria.
13. 2,201 shares of stock now in the treasury of the Company."
The changes made since then are as follows :
As to items 1 and 2, the valué of both the Santa Juliana and the
Ronquillo claim has been very much increased. The Ronquillo
shafí is down 112 feet deeper, and in Compromiso we have got
down to solid ground, and found that the vast, unexplored regions
to the south are apparently all solid meíal, of good qualiíy.
As ío ilem No. 3, íhe machinery for the new mili is now all, or
nearly all, on the ground, and its erection nearly completed.
As ío iíem No. 5, we have added very considerablyto the amoun.
of machinery and the plañí in íhe mine.
As lo iíem No. 6, íhe exploration of the Waterson mine has
continued, andwe have very lately struck what seems to be anoíher
very promising and valuable shuíe of ore from which we expecí
handsome resulís.
As to item No. 7, a good deal of new work has been done on the
Waterson mili, and we are connecting ií wiíh the Santa Juliana
shaft so thaí we can run ií on Sania Juliana ores when ií is not
kept busy on iís own.
As to item No. 8, the tunnel has been driven in some three hun
dred feet, and some valuable ore has already been taken out, and
we are approaching near to Balvanera, where we have every rea-

3o M/NING FOR PROFIT.
son to expect a continuation of the very good results which it
' yielded in times past.
As to item No. 9, there has been some litigation over the wood-
land, but it has been finally decided in our favor, and the central
government of México has sent peremptory orders that our posi-
tion and our rights are to be respected. Its intrinsic valué inde-
pendenlly of our enterprise is very great, while iís valué ío us is
almosl beyond compuíaíion.
As lo iíem No. 10, we have had elabórate surveys made of the
Bassaseachic Falls. Several of the electric companies here are al
work on íhe proposition for transferring the power to our mili and
mine, and it has been found entirely feasible.
We cannot but get very subslaníial benefil from our possession
and ownership of íhis property.
As ío iíem No. 12, we have jusl received a valuable graní from
the government of a zone surrounding the Cruz properties, and
the developments in íhaí neighborhood have been very encourag-
ing, indeed.
The Cruz is undoubíedly a very greaí properly, and we have a
righl lo expect much from Santa Juliana's interest in it.
As to item No. 13, the expeñditures during the last six months,
in the erection of the mili and the developmenl of íhe mine, have
been very greaí, allhough íhe bullion producí has helped us out
very much. Nevertheless, we have had to raise a good deal of
money by the sale of slock from íhe íreasury, bul íhe people inler-
ested in the Phelps Estáte and other slockholders have generously
put at the service of the Company a portion of íheir holdings, so
thaí our slock resources are still ampie.
Under íhe heading of " Our Finances," in my last Annual Re
port, I stated as follows :
"The Company started out with 50,000 shares of stock in its
treasury, as its working capital. It has expended for all purposes,
since the work commenced in June, 1889, $391,200.63. This money
has been raised by the sale of íhis treasury stock, and by íhe issue
of noles, wiíh íhe slock as a bonus. The lotal funded debt of the

M/N/NG FOR PROFIT. 31
Company al íhis date is $174,350. This amount is steadily decreas-
ing rather than increasing, notwithstanding our new issue of notes,
by reason of the fact that the noteholders are all the while availing
themselves of the privilege we are giving, of exchanging notes for
stock. In addition to this funded debt there is always some floating
debt, consisting of current expenses and drafts on their way, &c,
the amount of which it is impossible togivewith accuracy, because
it varíes from day to day, being usually largest at the end of
the month and smallest at the beginning. But ií may safely be
said íhaí ií is always more íhan covered by íhe unmarkeled bullion,
and by íhe mili and mine supplies paid for and on hand, or in
process of shipmenl."
Noíwithstanding íhe very heavy expenses since íhaí íime (íhe
heaviesí in íhe history of íhe Company), íhe indebíedness has in-
creased only abouí a hundred íhousand dollars, and our íolal ob-
ligaíions al high waler mark — íhaí is, al the point just before our re-
ceipts begin to exceed our expenditures — will not be far from three
hundred thousand dollars — a sum which can be discharged in a
very few months when the big mili gets running and the develop-
ment is far enough along so that it can be supplied with virgin ore
instead of waste.
In fact, I do not expect much, if any, further increase. The
money is now raised enlirely by íhe sale of síock, and íhe noles
which we have previously issued are coming in quile rapidly for
exchange inlo síock. Everybody seems lo recognize the fact that
it is a good thing to get all the Santa Juliana stock he can before
it gets out of his reach.
The actual cash valué of our assets, entirely independent of our im-
mense mining property, is more than sufficient to pay all our indebíed
ness and all our future expenses and leave us a handsome surplus.
The Price of Silver.
Our silver is costing us to-day about forty cents an ounce. We
shall reduce this very materially as we increase the production and
diminish the expenses. A majority of the silver coming into the

32 MINING FOR PROFIT.
markets of íhe world ío-day is produced at a cost of more than
seventy cents an ounce. A fall in price, which would malerially
affecí our profils, would ruin a majority of other mines. Our ad-
vantage over our competiíors consisís in íhis: We have a very large
vein, producing a very large quanliíy of ore of a high qualily, and
it is of such a nature íhaí ií can be reduced by the most simple and
inexpensive processes.
Buí we are subsíaníially independent of the price which the
world pays for silver for another reason : The bullion from íhe
Santa Juliana vein is about 13 per cent, in valué, gold. The bul
lion of the Ronquillo vein is aboul 33 per cení., gold. Our engi
neers fell us íhat when we have put in íhe elecíric power from
Bassasseachic and have our hundred síamp mili running, our ex
penses will be so much reduced íhat the mingled ores from these
two veins can be mined and milled at a profit for the gold alone
thaí is in íhem, and íhaí we can carry on our enterprise with silver
as a waste product.
The stockholders of the Santa Juliana Company can safely follow
their convictions on the silver question withoutfear of doing violence to
their interests. We Shall Not Fail.
It takes someíhing more than a good mine — yes, more even
íhan a good mine and good managemení — ío insure success in a
mining eníerprise. The number of mines that have been exten-
sively developed and have failed ío pay handsome dividends is
small ; íhe number of mining enterprises íhaí have been disappoiní-
ing has been greaí. Men very ofíen fail, because they lose their
faith or are templed lo slop loo soon. In common parlance, they
lack sand. A friend of mine now in this city, and who will read
these pages, had a striking experience of this kind. He and a
partner years ago sunk a shaft upon a ledge in Nevada. The
work was not encouraging, and they got tired and íhrew ií up.
Four feeí direclly under where they left off was af terwards discov-

MINING FOR PROFIT. 33

ered the famous deposit which was known to miners in thaí vicinily
as "The Bridal Chamber," and which yielded, wilhin a space as
large as an ordinary room, more íhan a million dollars.
My friend's successors are rich ; he hopes to be, but some time
in the future, and from some other investment.
There are thousands of mining enterprises thaí have been given
up, either voluntarily or involuntarily, just as they were upon the
eve of a brilliant success. The Scripture tells us that faith can re-
move mountains. It is almost literally true. At any rate, great
results cannot be obtained without great faith and persistence. In
business, as well as in theology, it is the man who endures unto the
end thaí is saved.
Bethuel Phelps, as he lay upon his deathbed, and commended
to my tender care íhe inleresís of íhose he lefí behind him, and
imposed upon my humble shoulders the work of the regeneration
of Sania Juliana, feared only one íhing. His belief in the mine
was infinite. He knew as well as a man in this world can know
anything, that the mine was great and would yield great resulls.
He feared only íhaí some who mighí come afler him would lack
the courage, which all who knew Mr. Phelps knew so well íhaí he
possessed in abundaní measure, and íhat they would not daré to
follow it ío íhe end ; and I have flallered myself íhaí íhe reason
why he selected me for this work, ralher íhan some olher and more
experienced man, was íhaí he believed íhat I perhaps made up in
persislence and in courage whal I lacked in higher qualities.
His fear was not altogeíher wilhoul reason. The managemenl
of the Santa Juliana enterprise al íhat time was by no means a bed
of roses. The obstacles to be overeóme and the difficulties in the
way of success were indeed very great.
(i). There were engineering difficulties. Ií was necessary lo
drain a vast underground lake six hundred and fifty feet deep in
the deepest part and a thousand feeí long in the longest part. We
were two hundred and fifty miles from a railroad, and of this one

34 MINING FOR PR0FI1.
hundred miles was a rough mule-trail. The machinery had to be
cast in sections not exceedingthree hundred pounds in weight and
packed in on the backs of mules. Such powerful pumping engines
as we needed had never before in history been taken so far, in such
a way. The whole interior of the mine, left by the Mexicans in
the worst possible condition, had to be cleaned out, rebuilt, and
protected with an immense amount of heavy timber, and there was
not a saw-mill in the Sierras; and then we had to sink our shaft
patiently, in solid ground nine hundred feet before we could be
under the oíd works and on a sure foundation. We had to build
our reduction plant on a scale grand enough to develop the grand
resources of our mine; and all this at a distance of three thousand
miles from our base of supplies, and one hundred miles from any
place where you could plant a hill of polatoes.
(2). There were diplomatic difficulties. We were in a foreign coun
try, under strange laws and a strange language. For the future secu-
rity and prosperity of our enterprise we needed much adjacent
property owned by prívate parties, some of them rivals, and all lia-
ble ío be provoked inlo hosíility from many causes, and we needed
still more many liberal concessions from the Government, besides
its continued friendship and protection.
(3). Mosl of all, we had financial difficullies. We had to raise —
we did not know how much, but it could not be less than — half a
million dollars, to send into a country, with a hisíory, to say the
least, not attracíive lo inveslors, three thousand miles from home
and almost unknown lo our people, lo be spent in reopening a
silver mine which for fifty years had been ñooded with water.
We have surmounted the obstacles, overeóme the difficulties
and succeeded in our efforts.
The engineering difficulties have disappeared before the won
derful executive genius of Sexton and the sagacity of the very
capable and efficient engineers he has called to his assistance. The
machinery has been taken in ; the mine is drained ; the oíd works

MINING FOR PR0FI1. 35

are cleared out and protecled so far as we have gone into them,
and a system has been devised which makes the rest of the work
comparatively easy. The best reduction works on íhis Continent,
outside of the United States, have been nearly completed, and part
of them are already in operation, turning out weallh for us from-
íhe debris and wasle íhaí we supposed ío be íhe worsí obslacles
that encumbered our pathway.
The diplomatic difficullies are enlirely overeóme, We have
boughí, ai fair prices, íhe property so necessary to our success.
We are on the most friendly íerms with the Mexican Government ;
it has granted us all íhat we have asked, and is ready to stand by
us and proíecl us whenever we need iís assistance.
As to the financial difficulties, we have carried on a campaign
of education the like of which has never been done before for this
Mexican country, and brought our enterprise to the atleníion of
the intelligenl, conservative business men of our nation ; over
eóme the most natural prejudices against Mexican investments and
íhe still greaíer, but more unnatural, prejudice against investmenís
in mining, and have raised seven hundred íhousand dollars for
Sania Juliana ; and you my dear, patient, appreciative, loyal stock
holders and friends, will, I know, sland by me in íhe fulure as you
have so royally in íhe pasí, and will be only íoo glad ío help your-
selves and your friends in helping us ío raise whalever more may
be needed for íhe completion of the work, if I ask you ío do it.
The difficulties may not all be over yet ; that part of the road
which lies now before us may not be in all respeets enlirely smoolh,
but we are on the downhill side of the mountain, we have crossed
the Divide, and nothing can come up in the future which will test
our courage or try our nerves like the difficulties we have had in
the past. We are on the home stretch. The mine has proved it-
self. May I not, without immodesty, say for the men who have
been in charge of the interests of those who have invested in it,
that we too have in some measure proved ourselves and are worthy
enough of the cause we have undertaken to give you satisfactory
assurance that we shall succeed in it, that we will not beat a retreat

36 MINING FOR PROFIT.
in the moment of victory and in full sight of the promised land,
as we are, and to inspire vou with abundanf confidence that we
shall not fail, for- —
We will not fail.
The Morale of the Santa Juliana . Enterprise.
The stock gambler does not like us. We are mining for profit
and not for speculation, and he sees in our melhods and in our pur-
poses no opportunity for his fine work. We find our clientage
and obtain our support among the solid, substantial, clear-headed
and far-sighted business men and inveslors of íhe communiíy. Our
íhree hundred and mere síockholders have taken their interest in
our enterprise as an investment fromwhich they confidenllyexpecl to
get handsome and permaneni reíurns, and not as a gamble on which
they may win or lose as the cards turn. Santa Juliana has appealed
lo íhe community on its merits. Ií has asked people ío invest their
money in it because it is a business enterprise, founded upon a
rational business basis, managed on business melhods and promis-
ing solid, subslantial and exceedingly liberal business results.
It is this fact that gives us our great strength, that has
enabled us within the last three years to send from this country
into the mountains of México nearly three-quarlers of a million
dollars for íhe development of our enterprise, and which
will enable us to back it up with whatever more may be
necessary for íhe same purpose. The kind and cordial
words of confidence and appreciafion which íhe stock
holders from lime to time express, are always welcome to our
ears and inspire us with a renewed determination to conduct the en
terprise to its conclusión on the lines on which it has been
worked from its commencement. The occasional words of criti-
cism that we sometimes hear are no less welcome. If the criti-
cism be well íaken, we íry to profil by it ; if not, we are usually
able to convince the critic of his error. For myself, I can f ruly
say that Santa Juliana during the years past has been so much a

MINING FOR PROFIT.

37

parí of my life, and is so ingrained in my nervous sysíem, that the
grand success thaí I am sure will soon come will be quite as
welcome lo me, simply because ií is a success as because of the
substantial pecuniary rewards that such success brings.
The nearer we get to the end, the more I wish thaí Bethuel
Phelps and Bezaleel Sexton could have lived to have seen it.
WALTER S. LOGAN.
December 15, 1891.

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