Start-up eyes Pine Nut gold project
A start-up mining company is hoping to strike it big in an area of Douglas County that has yielded little mineral wealth over two centuries.
Incorporated in Florida, and headquartered in Australia, Gold Mining USA Inc. has purchased the exclusive mining rights to the 160-acre Gypsy Mine located in the Pine Nut Mountains east of Minden.
“It’s a plot that it seems no area officials even knew existed,” said Vice President of Operations Brian Jenkins. “It could very well be a hidden treasure.”
Jenkins said the site hasn’t been actively mined since the 1970s. He estimated the company will begin commercial operations within six to eight months.
In an internationally distributed press release, the company cites an “independent” geological report that estimates the total mineral resource value of the property to be more than $360 million. Based on the report, the company believes the mine would yield 15-16 grams of gold per ton of ore for several years, which amounts to a little more than half an ounce of gold per ton.
Mining claims in the Pine Nut Mountains, however, have produced mixed results at best.
“Erratic deposits of gold, silver, copper, iron, tungsten, antimony and lead ores were opened on surface outcrops over various slopes, canyons and foothills of the Pine Nut Mountains. The surface ores usually yielded the richest values and tend to diminish with depth,” late author Nyle Nation wrote in his 1991 book, “The Pine Nut Chronicle.” “The mineralized ore veins and ledges were generally pocketed and highly fractured by faults which are predominant throughout the range. Considerable sums of money were expended in the search of the illusive vein after it faulted and was one of the major factors in preventing the success of a productive mine.”
Nation described mineral production in Douglas County as “negligible” compared to other counties in Nevada.
“The years 1865 through 1940 list a gross yield in mineral production of $292,338,” he wrote. “Later years, production of tungsten deposits in the Gardnerville Mining District and the Minnesota Iron deposits in the Buckskin District made a significant contribution during the period of 1944-1971.”
Gold Mining USA’s valuation of $360 million was based on 80 percent of spot silver and gold prices, according to the company’s press release. Company officials also believe that only 5 percent of the entire gold deposit has been extracted.
According to its website, Gold Mining USA was incorporated in 1995 and is “focused on the acquisition and development of mining properties which have the potential to produce gold, silver and other valuable base mineral resources.”
In the past year, under new management, the company has undergone a name change, a symbol change and reverse stock split.
The stock currently trades on the over-the-counter marketplace, which, unlike traditional exchanges, doesn’t require financial auditing. The company is described as being in the “developmental stage” with no discernible earnings. Last July, the company listed four employees.
As of April 24, the company’s market value, with a little more than 2 million outstanding shares, was about $2.93 million, according to OTC Markets Group Inc.
In June 2012, the company announced it acquired a 20-acre mineral rights claim in Esmeralda County.