Red-Hot Resources

"Luck is not chance, it’s toil; fortune’s expensive smile is earned.”

Sunday, August 12, 2007

Gold Rush in Yellowknife

I have arrived in Yellowknife – a town steeped in rich gold mining history. I had a lot of time to reflect on that history as I walked through town today.

I went for a long walk in Yellowknife’s brisk, sub-arctic August summer because my cab driver brought me to the wrong hotel from the airport. I did not discover this until after I had walked in to the hotel and he drove off.

I tipped him well, too. I hope he uses it to buy a sandwich, and chokes on the sandwich.


The good news is that Yellowknife is small enough that I could walk across town to the correct hotel. And after indulging in a brief revenge fantasy wherein I dumped the cabbie in the middle of Labrador with nothing but his bathrobe and a map (of Guam), I reflected on Yellowknife’s history.

The history of Yellowknife starts before man walked this forest primeval, in the time of the glaciers. The glaciers gouged an irregularly-shaped,11,000 square mile depression in the earth's surface. As the glaciers receded, the Hay River and the Slave River were formed. The Hay rises on the eastern slope of British Columbia's Rocky Mountains and flows generally north-northeast. The Slave River pours out of Alberta and Saskatchewan's Athabasca Lake, flowing north-northwest. These two rivers meet at that glacier-gouged depression, and their waters created the eleventh largest lake in the world, Great Slave Lake.

The lake was named by the Cree and Chipewyan tribes, who made prisoners of the locals so often they called them the “Slavey” band of Indians.

The white man’s history begins when Samuel Hearne , an explorer for the Hudson's Bay Company, reached the shores of Great Slave Lake in 1771. Accompanying Hearne on his travels were members of the Tatsanottine, a small Athabaskan-speaking North American Indian tribe. Hearne called them the “Copper Indians,” but everyone else called them the Yellowknife Indians because the tribe made knives and other tools from yellow copper. The town of Yellowknife was named after these intrepid native explorers.

In 1896, a prospector named E.A. Blakeney passing through Yellowknife Bay found some gold samples, but quickly moved on, because he was on his way to a much bigger gold rush – the Klondike.

For a long time, the real treasure for white men in this neck of the woods was the fur pelts they took from animals who sometimes clustered so thick it was like setting traps at a petting zoo.


So gold was forgotten at Yellowknife until prospectors Johnny Baker and Herb Dixon paddled down the Yellowknife River and made a gold discovery in 1933. This date is generally viewed as the birth of the gold camp.

But the boom didn’t arrive until government geologists discovered gold on the east side of Yellowknife Bay in 1934.

In 1935, the staking rush was on. This led to development of the Con
Mine, which entered production in 1938 and produced over 5 million ounces of gold.

But even before the mine delivered its first ounce of gold, the boom town of Yellowknife sprung into being overnight. Its population swelled to 1,000 by 1940 and by 1942 five separate gold mines were frantic beehives of activity.

And in 1944, new exploration at the Giant Mine on the north side of town showed that there was a lot more gold in Yellowknife than anybody had imagined. The boom was ready to kick into higher gear.


But in 1945, gold mining slowed
drastically as all the gold miners left for a bigger cause – World War II! Operating costs skyrocketed.

The miners came back in 1946, and the boom picked right up where it left off. The Con Mine expanded and new mines started up.

Yellowknife’s boom years went through 1952, when the Negus Mine closed. Most other mines closed in the 1970s as gold prices went into a depression.

But many other operations kept on until very recently. The Con Mine, after 65 years in operation, closed in November, 2003. The Giant Mine, a producer since 1948, was the last to go when it closed in 2005.


For most of this time, Yellowknife didn’t even have its own government. It finally got one in 1953. Then in 1967, it became the capital of the Northwest Territories. The inflow of government workers proved to be as big a boom as gold ever was.

Yellowknife is considered to be one of the best places in the world from which to view the Northern Lights. But the place where I’m going from here should be even better. Stay tuned! Right now, I’ve got to go buy a hat, scarf and some other supplies. It’s gettin’ darned cold!
Check out my new gold and energy blog at MoneyAndMarkets.com