Published Friday, Nov. 30, 2012 | 2 a.m.
Updated Friday, Nov. 30, 2012 | 1:31 p.m.
There’s gold in them thar hills.
Or is it just gold fever?
The answer may come soon as Nevada Mining and Milling LLC, a company whose management includes the former CEO of a gaming products company, will seek county zoning variances to mine anew the Coyote Mine near Searchlight.
Coyote Mine is about 1.5 miles north of Searchlight, just west of U.S. 95, in hills known as the Opal Mountains. Prospectors began mining the area in 1898.
According to state documents, it was never considered a large gold producer and, like many mines established in the area in the early 1900s, its production tailed off quickly. Overall, production in Searchlight-area mines peaked around 1910.
This year, the Shuler family sold Coyote Mine to Nevada Mining and Milling, a limited liability company whose managers include Roland Gentner, according to records from the Nevada Secretary of State's Office.
Gentner was CEO of Sodak Gaming Inc., a Rapid City, S.D., company that distributes gaming products and software systems to Native American casinos. International Game Technology purchased Sodak in 1999 for a reported $230 million.
The Searchlight Town Advisory Board unanimously approved Nevada Mining and Milling’s plans Wednesday night. County commissioners likely will vote on a request for a zoning variance for the project at their second meeting in December.
County Commissioner Steve Sisolak, whose district includes Searchlight, said the company hopes to begin mining in February. Company representatives told him the operation would create 40 to 60 jobs that pay $25 per hour plus benefits.
“And not to diminish fast-food jobs, but these are jobs that I was told will pay much more, giving people a wage they can live on,” he said.
According to a permit approved by the Nevada Division of Environmental Protection, Bureau of Mining and Reclamation, the company expects to sift and winnow from 6,000 to 10,000 ounces of gold per year from the mine.
The price of gold fluctuates daily. Over the past six months, its price per ounce has varied from a low of about $1,535 to just more than $1,700. Wednesday’s closing price was $1,716.90 per ounce.
Based on price of $1,700 an ounce, revenue from the mine’s gold sales would reach between $10.2 million and $17 million annually. Clark County would see a modest increase in tax revenues of about $200,000 from the operation, Sisolak said.
Based on a variety of sources on the Internet, the cost to mine an ounce of gold ranges from roughly $400 to $700 an ounce.
“So they obviously believe they are going to make money,” Sisolak said.
He added that economic benefits from the mine for Nevada are estimated at about $8.5 million per year.
The Coyote Mine Road location is close to the site where the Tea Party held a massive rally in 2010.
The state permit says no chemical leaching, a gold extraction technique, can be used without a change in the permit. The operation is authorized to process 36,499 tons of ore per year.
Located on 38 acres, Coyote Mine consists mainly of three underground shafts that over the years were given names: Fault, Coyote and Frederick. The permit says the company has authorization to “rehabilitate” the Fault and Coyote shafts; the company also plans to initiate underground exploration.
Water from existing wells will be pumped into two 10,000-gallon holding tanks to be used in processing the ore. The permit says about 48,000 gallons of water would be used per day in the process.
CORRECTION: This story has been updated with the correct date of the beginning of mining at Coyote Mine. | (December 1, 2012)