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Bakers Creek Gold Mining Company (1887 - 1906)

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Location: Bakers Creek, New South Wales, Australia

Incorporated in 1887, the Baker’s Creek Gold Mining Company listed T. B. Gall, William Smith, J. R. Corpe, Alfred Walton, William Taylor and Thomas Barnfield as directors in its half yearly report of 1904. The report also noted liquid assets as of December 31, 1903 to be more than 3,000 pounds. The mine was situated in the gorge country, south east of Armidale.

Baker’s Creek Goldmining Company was formed in August 1887 to exploit the rich mineral deposits of Hillgrove, a small mining town about 24 kilometres east of Armidale in northern New South Wales. Gold had been discovered there as early as the 1850s, but it was not until the late-1870s that mining proper began. John Bracken, Peter Daly and James Elliot had opened the Eleanora mine in the early-1880s and, after experimenting with the extraction of antimony, had decided to concentrate on procuring gold. But the township - at the time known as Eleanora after the mine which provided the sole reason for its existence - remained isolated.

Then, in 1887, gold bearing reefs were discovered in the Hillgrove gorge, a spectacular valley almost 500 metres deep to the west of the township. In March that year, George Smith, a shareholder in the Eleanora, was ‘as usual’ prospecting the surrounding country and stumbled upon ‘a rich outcrop on the side of the gully much closer to the bottom than the top’. After several weeks of ‘hard toil’, as he said, Smith determined the location of the Big Reef in Baker’s Creek, pegged out a claim and invited his brother William and two others to form a partnership. He declined an offer to manage the Carrington Mine, ‘having’, as the Sydney Illustrated News put it several years later, ‘something better in view’. Within four months Smith and company had won £2,500 worth of gold using a primitive spring loaded dolly. They named it the ‘Four Brothers Mine’.

Less than six months later, Smith, recognising both the need for additional capital and the opportunity to make a handsome profit, sold the claim to an Adelaide company. On 26 August 1887, the Baker’s Creek Goldmining Company came into being with a capital of £100,000. At first a five-head stamper was installed, but by 1892 the battery was operating at eight times that capacity. In the mid-1890s, about 500 tonnes of stone was milled each fortnight. Meanwhile, a plant was built to process the mass of auriferous rock being churned out of the field’s seven reefs. Access to the mine was by way of an incline tramway, which, when finished in June 1889, wound its way down 2,660 feet of track to the plant at the bottom of the gorge. The first of its kind on the Hillgrove field, the Baker’s Creek tramway was in places almost vertical in its descent. With the necessary capital established, the company turned its attention to the task of exploting the mine’s plentiful bounty. And the results were spectacular. The Little (or Smith’s) Reef, a small vein of gold running east-south-east of the gorge, was particularly rich and in 1889 returned 24,825 ounces, the maximum production in any one year on the Hillgrove field. Overall, Baker’s Creek remained the most lucrative mine on a field where literally hundreds had been established in the fury of speculation which followed Smith’s discovery. Over the next decade, this one mine yielded 187,414 ounces of gold out of the 311,225 ounces mined at Hillgrove; by 1897 the company’s shareholders had been enriched by dividends of £247,500 on their paid-up capital of £87,000.

But the spectacular success of Baker’s Creek came at a cost. In the frantic climate of the late-1880s and early-1890s, little if any consideration was given to the company’s overly expensive mining techniques. With mineral riches beyond the wildest dreams of its shareholders, moreover, the company had failed to put aside a reserve fund. As early as 1890, a correspondent for the Sydney Morning Herald spoke of ‘bitter times’ for the mine in the forseeable future. While recognising its wealth (indeed, shares had quadrupled in value over the previous twelve months), the correspondent warned that ‘the true condition of affairs’ at Baker’s Creek revealed a mine being rapidly exhausted by inefficient mining practices and large dividend payouts. By May, the mine’s manager was finding it ‘impossible’ to produce enough gold to remain abreast of monthly rates. Increasingly, it was averred, ‘there was a disposition to get out of Baker’s Creek’.

The situation was not quite so grim. The mine continued to produce impressive levels of payable stone, but, as the Herald’s correspondent anticipated, the bountiful deposits of the first few years were now depleted and the company could no longer hope for the same spectacular returns. It was increasingly forced to sink deeper shafts (they eventually reached down 1,700 feet). To prevent the danger of rock bursts, protective timbering and wire gauze gaurds were built. As the company dug deeper and deeper into the gorge, costs skyrocketed while the availability of payable ore declined. After 1900, dividends ceased and three years later, the first ever call was made on shareholders to finance development costs in the lower levels. Declining gold values added to the company’s problems. In 1906, the Baker’s Creek Gold Mining Company was wound up.

A new company, known as the Baker’s Creek Gold Mine, was formed almost immediately with a capital of £25,000, but the enterprise was short-lived. In 1910, the mine was let on tribute, and apart from a rich shoot of gold worked in 1912, results were again poor. The plant soldiered on until 1917, when it was closed and then re-opened as the New Baker’s Creek Gold Mining Company with capital of £20,000. Disapponintment was yet again the order of the day; in 1917, the company won a beggarly 744 ounces from the mine. In May 1921, mining finally ceased and by November the following year all machinery had been dismantled.

Baker’s Creek would experience a brief revival in the 1930s and 1940s, when Thomas Snow began working the mine again. A company, the New Baker’s Creek Gold Mine was established in 1937 with Snow as manager, but within a year the mine was struggling. Income for that year was a touch over £42 in the sale of gold ore, while fuel costs alone amounted to £115. Since 1938, over £7,000 had been sunk into the mine with little to show for the efforts of its owner. The mine was sold in 1940, but it was not until May 1954 that a liquidator was appointed to wind up the affairs of the New Baker’s Creek Company.

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Sydney Morning Herald (undated, c.1890); Illustrated Sydney News (16 July 1892); RB Walker, Old New England: A History of the Northern Tablelands of New South Wales, 1818-1900 (Sydney: Sydney University Press, 1966); Ross Mainwaring, Tramways Down the Gorge: The Story of Hillgrove, 2 vols., Light Railway Research Society of Australia, vol.XXIV, nos.94 (October 1986) and 96 (April 1987)

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Structure based on ISAAR(CPF) - click here for an explanation of the fields.Prepared by: Matthew Jordan
Created: 26 June 2002
Modified: 7 July 2006

Published by The Australian Science and Technology Heritage Centre, 5 April 2004
Prepared by: Acknowledgements
Updated: 23 February 2010

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