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Copper King

As the centennial of Chino Copper Co. approaches, a son remembers how his father brought the fabled Santa Rita del Cobre mine back to life.

By John M. Sully, II

 

Native copper, pure copper, sometimes called "ferns" of copper, not needing to be refined, at one time could be found lying on the ground in a valley northwest of Santa Rita Mountain and overlooked by the rock formation known as the Kneeling Nun. This was the only place in the American Southwest where pure native copper had been found simply lying on the ground. The native copper was first picked off the ground and used by the Apaches and others for ornaments and arrowheads and for trading.

Sampling and engineering crews working at the Santa Rita Mining properties. Photograph probably taken by John M. Sully of Santa Rita Del Cobre about 1905. Reproduced by Norm Jensen from "Report On Property Of Santa Rita Mining Company."

Europeans came into the story when Lieutenant Colonel Carrasco, a Spanish Army officer, discovered the copper deposits while on an exploratory expedition. An Apache is said to have shown him the copper deposits in gratitude for an act of kindness by Carrasco. After Carrasco's discovery, King Charles IV granted the Santa Rita del Cobre region to the Elguea family in 1800.

Beginning in 1804, the Elgueas mined the copper by sinking primitive mine shafts; they established a penal colony at Santa Rita to provide labor for the mines. The native copper was taken to Chihuahua by mule train to be made into coinage for Mexico. Active mining continued off and on, depending on relations between the Apaches and the miners, until the late 1800s. By that time, the easy mining of native copper was almost exhausted. Most of what remained was copper minerals, not native copper. These minerals were not easy to refine.

The second life of the Santa Rita del Cobre copper mine — the era of modern, mechanized extraction that continues today in Grant County — would not begin until 100 years after the Elgueas family first tapped those rich veins of copper. In December 1904, my father — John M. Sully — was hired as assistant mine superintendent at Hermosa Copper Co. in Hanover, NM. His arrival in New Mexico was the start of a long involvement with the Santa Rita del Cobre mine, a struggle to raise the capital to develop the mine. "It is a story full of pathos and human interest," my father would later describe it, in an article published in 1915 for the Official State Book of New Mexico for distribution at the Panama-California Exposition at San Diego to celebrate the opening of the Panama Canal.

 

As the fame of the rich ore deposits of the original Santa Rita Del Cobre Land Grant had grown, by the 1870s the area became known as the Central Mining District. The district included Bayard, Fierro, Hanover, Central (Santa Clara), Vanadium, Santa Rita and Georgetown. At one point, this 45-square-mile area in Grant County had produced more gold, silver, copper, lead, zinc, iron, manganese, molybdenum and vanadium than all of the other metal mining districts in New Mexico combined.

By 1873 the fame of the rich copper deposits had attracted investors nationwide. A succession of investors, including J. Parker Whitney of Boston, the Hearst estate and Amalgamated Copper Co. (an affiliate of Standard Oil) unsuccessfully attempted to develop the Santa Rita del Cobre Grant. Transportation was tricky. Markets were distant. Refining the copper was neither cheap nor easy.

In 1899, the Amalgamated Copper Co. stockholders — H.H. Rogers, W.D. Rockefeller, Thomas W. Lawson, A.C. Burrage and three others — reorganized as the Santa Rita Mining Co. After just five years, they had lost interest because of low copper prices, mismanagement and adverse reports. In late 1904, the stockholders sold Santa Rita Mining Co. to Hermosa Copper Co., a subsidiary of General Electric, headquartered in Hanover.

My father's route to Hanover and the Santa Rita mine began in Dedham, Mass., where he was born on July 5, 1863. He was educated in the public schools of Cambridge, Mass. and graduated from MIT in 1888. He was employed by several companies, including Chickamauga and Durham Railway/Chickamauga Coal and Iron Co., where he worked from 1892 to 1902 as a mining engineer and general superintendent of the coal mine on Lookout Mountain, in Tennessee.

John M. Sully was employed as assistant to the general manager of the Woodstock Iron Works at Anniston, Ala., when he was hired by Hermosa Copper Co. in December 1904.

 

In late 1905, Sully was asked by General Electric, the parent corporation, to make a report on the resources of the Hermosa and Santa Rita properties. He began the study by making an accurate topographic map of the region at a scale of 100 feet to the inch. Then east and west coordinates were set up at 100-foot intervals, to mark the location of points to be sampled by drilling. The 100-foot coordinates that Sully delineated in 1906, called Chino Coordinates, are still in use by Chino mining engineers 100 years later.

In his subsequent report, Sully described how the samples were taken: "Drilling was begun near the coordinate intersections. . . . Samples of the material were taken about every three feet and assayed. . . . Records of the materials were carefully kept. When the facts collected in prospecting and sampling the ore bodies was supplemented by geologic and general mining cost data, the whole body of information systematically gathered was used in estimating the tonnage of rock rich enough to be classed as ore available for mining."

Sully and his crew took 4,300 samples from the mines and mine dumps. These were assayed by G.W. Cameron for Hermosa Copper Co. Duplicates of the samples were sent to assay offices in El Paso and Denver for confirmation.

Sully also tested the efficiency of the Hermosa and Santa Rita company mills. He found that the Santa Rita mill recovered only 46.75 percent of the copper ore and the Hermosa mill recovered 69.5 percent. Both figures were below the industry average at the time, which was a 75 to 80 percent recovery rate.

He completed his report on Sept.1, 1906, concluding that "298,000,000 pounds of copper could be produced and placed in New York at a total cost of 9.1 cents per pound."

Sully recommended in his first report on the mines that the mine shafts and drifts should be repaired and restored as needed. He also proposed building a new, more efficient mill and smelter to improve the recovery of copper.

 

In October 1906, however, Hermosa Copper Co. officials became discouraged with the mining operation. So Sully resigned in November, believing he had no future with the company because the company did not act on the findings of his report.

In prospecting trips to Mexico in late 1906 and early 1907 after he left Hermosa, Sully met W.D. Pearce, a brokerage firm representative. Pearce was acting for Standard Oil/Anaconda Copper and its investors, including A.C. Burrage, H.H. Rogers, Thomas Lawson and others.

Sully informed Pearce of his conviction that Santa Rita could be a great mine. Pearce asked to see Sully's report and possibly get an option on the mine. So Sully went to Hermosa and obtained a release of the report.

A.C. Burrage got the report from his man Pearce in late 1906 or early 1907. Burrage was so impressed with the report's findings that he sent two engineers to verify the conclusions of Sully's work. Both agreed with Sully's conclusions. Burrage then met with his associates and attempted to interest them in further development of the property. They refused, but agreed to give him options on their stock so he could proceed. Burrage asked Sully to a meeting in Boston to discuss the report.

In late 1907 Sully met with Burrage. As a result of the meeting, Burrage asked Sully to return to Santa Rita with W.H. Wiley, another mining engineer, to update the report. They completed the update in September 1908.

This time, Sully examined 10,000 samples from the mine shafts, underground works and dumps, 45,000 feet of drifts, shafts and adjoining tunnels in all. He estimated the value of the ore bodies over and above all operating expenses at $27,443,582, assuming 13 cents a pound for casted copper in New York.

Burrage, Thomas Lawson and Sully met in the fall of 1908 in Boston with Hayden Stone Brokerage to discuss purchase of the Santa Rita and Hermosa properties. Sully had completed the updated report on the train as he was returning to Boston for the meeting.

After reviewing the report, Hayden Stone asked to have another engineer, Beatty, review the work of Sully and Wiley. So the three engineers returned to Santa Rita.

Beatty spent two days examining the mines and report. Then he and Sully returned to New York to meet with Burrage and Hayden to discuss completion of the purchase. Bafflingly, Beatty refused to verify the report findings — so Hayden refused to underwrite the purchase.

After more than a century, it looked as though the saga of the Santa Rita del Cobre had come to an end.

 

In November 1908, however, Burrage asked Sully to visit the Utah Copper Co. mine operation in Bingham, Utah. to determine if the methods used there could be used at Santa Rita. While there, Sully met D.C. Jackling, founder and president of Utah Copper Co. Sully saw the advantages of open-pit mining as a result of his visit to the Bingham mining operation.

Meanwhile, Lawson issued 60,000 copies of a prospectus to finance the purchase of the Santa Rita property. The prospectus served as an introduction to Sully's third, 1909 mine report. Lawson included his own proposal for a more efficient method of copper refining. In issuing the prospectus he hoped to raise $21 million. But Lawson was no mining engineer and had no experience in the field. His attempt failed and funds that he raised had to be returned to the investors.

The value of the prospectus was in Sully's 1909 report. Sully concluded in this report, "There is a large tonnage of ore varying from 2.11 to 3.45 per cent copper." He continued, "These deposits and outcrops promise, on development, to add much to the future value of the property."

In the spring of 1909, the financial position of Burrage was critical. Burrage notified Sully that he had been negotiating with H.H. Rogers to underwrite the purchase of Santa Rita. Rogers agreed to do so. They were to meet the next day, May, 19, 1909, to sign the papers finalizing the agreement. But while Burrage was en route to the meeting he was notified that Rogers had died of a heart attack at six that very morning.

Five days later, Burrage's stock options would expire and he and his partners would lose their investment. Sully's many trips to the east by train, 25 days and 12,500 miles in all, would have been in vain.

At the last minute, the very day Burrage's options ended, Hayden Stone took over the options and proceeded to organize a new company to be operated as planned in Sully's latest report. The new company was capitalized at 700,000 shares at $5 per share. Burrage and Lawson lost control, but received 125,000 shares in the new enterprise for their 25,000 shares in the old company.

In his 1915 history of Chino Copper Co., John M. Sully wrote: "In June of 1909 the old Santa Rita Del Cobre Grant, with additions to the original ground that accumulated during all those years, passed to the powerful and intelligent mining interests who now control Chino Copper Company."

 

Prior to June 1909, the Grant County economy had been in a state of depression. Employment was low and the mining industry was stagnating. The creation of Chino Copper Co. changed the economy of Grant County and Southwest New Mexico forever.

Chino Copper would have a financial impact on about 75 percent of all residents of Grant County and southwestern New Mexico. In 1911, the first year of operation, sales were a mere $131, 231, but grew to over $4 million during 1912, the first full year of operation. By 1915 income was over $11 million with profits about $7 million.

Sales remained high until the end of World War I. In the boom year of 1917, sales hit $19 million and profits reached $9 million. Sales fell after the war and there were periods when the mine shut down.

My father's devotion to the Chino Mine and his employees — "my men," as he referred to them — showed through strongly in the years after World War I when the there were periods of shutdown. He had the company issue scrip, commonly called "Boleta," to be used at the company store to purchase necessities for those idled by shutdowns.

Boleta in the early years were cards with denominations from five cents to 25 cents printed around the edges. When these were presented to the company store cashier, she would punch out the amounts equal to the amount of the purchase. These cards had a total value of $5 each. Later scrip took the form of a coupon book with tear-out pages. Each book was worth a total of $10. The company store cashier would tear out pages representing the amount spent.

Despite some hard years and shutdowns, today, the former Santa Rita del Cobre mine — one of the largest open-pit mines in North America — is still operating, 98 years after Chino Mine began work. Considering how thoroughly John M. Sully mapped and examined the copper resources of Santa Rita Del Cobre, it is doubtful he would be too surprised the mine is still operating. Some of the men who did not trust my father's judgment, though, might be very surprised.

 

Born in New Mexico, John M. Sully, II, now lives in Oregon.

 

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