Compass: Feds played a role, but private prospectors often led the way in Alaksa mining

To claim that the federal government had a role in the discovery and development of Alaska's hard mineral wealth is true. But to claim, as does Steve Haycox in the Daily News on Oct. 4, that the role was prior and more important seems at least questionable. Miners often led.

Alaska's first major hard mineral discovery was in Juneau in 1880 by prospectors. The resulting rapid development and growth at Juneau led to Alaska's first organic act in 1883. This act brought the first civil government to Alaska with laws from the Oregon territory. Alaska received its first judge -- one man to cover the legal needs of the vast area--and an appointed governor. By those actions, government responded, not initiated. In Alaska's Interior, the first important gold discovery was made in the Forty Mile in 1886, but it followed the lead of prospector-traders Jack McQuesten, Al Mayo, and Arthur Harper, who had been in the country since the 1870s. If there was a subsidy to Alaska it was from the Hudson Bay and other fur trading companies. The first banker along the Yukon was not a government agency. It was McQuesten.

A great deal of prospecting in Alaska was triggered by the Klondike rush in the Yukon in 1896. The gold discovery at Nome by the "lucky Swedes," close on the heels of the Klondike, brought thousands of miners to Alaska's Seward Peninsula just before the turn of the century. That and continued activity in the Interior led to the first significant Alaska legislation since 1883--two more federal judges were authorized. The judge (Noyes) sent to Nome was a crook, and the other judge, James Wickersham, had to spend most of his first two years cleaning up Noyes' mess.

The army sponsored a wide ranging expedition in 1885 by Lieutenant Allen beginning in the Wrangell Mountains where Copper River natives had mined copper for many hundreds of years. True, but Allen found an American copper prospector already in residence at Chief Nikolai's camp. A copper rush followed private discoveries in Prince William Sound in 1897.

An exceptional USGS geologist, A.C. Spencer, found a rich copper deposit that became Kennecott in 1900. The deposit, however, had been discovered a few days earlier by prospectors Warner and Smith. To develop the deposit, J. P. Morgan and the Guggenheims made the first major capital expenditure in Alaska. They invested more than $35 million, $22 million of which built a 196-mile railway to Cordova, where another few million bought a steamship line. The railroad by itself cost about three times the purchase price of Alaska in 1867. The Kennecott mine proved exceptionally rich and made an operating profit from its inception to closure in 1938. But by 1916, the mine had not repaid its capital cost which was done by smart maneuvering on the stock exchange. Before the Kennecott investment English capital had made the Treadwell mine at Juneau the largest low-grade gold mine in the world and the major Alaskan employer.

The first federal expenditure to exceed that of Kennecott's was for the Alaska Railroad in the 1920s. And a main justification of the railroad was so low-grade gold resources left from high-grade drift mining at Fairbanks could be recovered by huge dredges -- the dredges needed rail support.

There were many heroic expeditions carried out by the military and later USGS which contributed to the development of Alaska, but government surveys were not always the leaders. I don't believe that historians Haycox, and before him Morgan Sherwood, have proven their hypothesis that government efforts were the most important. Haycox's statements about importance of USGS reports are exaggerated, if not just wrong. (I worked there for 17 years.)

Moreover, the issues raised here are still important. A modern Alaskan's thinking is still influenced by his or her beliefs about the relative veracity of Judge James Wickersham or Daniel Guggenheim, and that in turn influences our opinions on current resource development in an owner state -- if it is one.

Chuck Hawley is a geologist and director of Truth About Pebble. He lives in Anchorage.