Investors Betting Millions On Sierra Gold Mine
AMADOR COUNTY (CBS13) -- A group of investors is betting millions the gold rush isn't over in the Sierra Foothills. They're spending more than $20 million to get a mine in Amador County back up and running.
The mine goes about 650 feet underground and it's about to get a whole lot deeper.
They've done the research, and Sutter Gold Mining Inc. says there's a lot of gold in the rocks. The light-colored quartz will guide miners to veins of gold and the potential for a billion dollars.
"We'll be mining about a third to half ounce of gold per ton," said company spokesman David Cochrane.
The untapped, underground territory is about to get blasted.
"The miners will drill holes, set charges and blast it down," said Cochrane.
David says an astonishing 20 tons of gold lies within their 3.6 mile stretch of land. At today's rate of about $1,600 an ounce, that's over $1 billion of valuable rock.
"They say only 10 percent of the entire Motherlode has been explored, so there's a lot of potential in this region," said Holly Boitano, a fifth generation Motherlode miner. "I just have gold fever so it's kept me here."
That gold fever is kicking off a new gold rush and creating 100 new jobs.
"The profit potential is the drive. There's a huge profit potential here," said Boitano.
An Australian bank is willing to loan Sutter Gold Mining Inc. $20 million to dig into that potential. They expect to pay it all back in gold, of course.
"It's a great opportunity to return gold production to the Motherlode," said Cochrane.
They've spent nearly 20 years researching, sampling, and getting permits to meet California's tough environmental standards, and now Sutter Gold Mining Inc. finally got the funds to find out what these rocks are really worth.
They'll spend the next year digging out more tunnels, drilling, and blasting. They expect to pour their very first gold bar by summer of 2012.
The original gold rush ended for the Motherlode in the mid 1900's when the value of gold dropped to $35 an ounce, according to Sutter Gold Mining officials.
So at today's rate of about $1,600 an ounce, the company says exploring for gold is well worth the investment.
