With a gleam in his eyes, Sidney Hamden recalls the glory days ofKirkland Lake, the little Canadian mining town in northern Ontario thatwas long agodubbed "The Mile of Gold".
Hamden, a spry 82-year-old, remembers his first big break in 1947 at theLake Shore mine, then one of the deepest gold mines in the world,producing8.5 million ounces between 1918 and 1965.
"We had seven mines. I personally don't know of any other place that hadseven major mines within a radius of two miles," said Hamden. "If I'mnotmistaken, in 1948 there were approximately 50 different places to buygroceries around town. We had 17 different hotels in the Kirkland Lakeareaalone."
But Kirkland Lake's fortunes waned through the 1950s and 1960s, as costs rose and the price of gold stagnated.
One by one, the mines shut down, and by 2000 the town's population hadshrunk to 8,500 from over 20,000. Mining jobs vanished, shops and hotelsclosedand housing prices crumbled, prompting fears that Kirkland Lake -- aneight-hour drive north of Toronto -- could turn into a ghost town.
With gold now soaring to $1,700 US an ounce and higher, the town hasbegun to regain some of its lost luster. Companies are reopening minesthat weremothballed for decades, offering many new jobs and sparking an economicrecovery in the area.
As geologists hunt for the next big gold prospect among the lakes andforests of Canada's mineral-rich Abitibi-Greenstone belt that runsthroughOntario and Quebec, housing prices are soaring and skilled mine workersare in short supply.
"I became mayor when there was not much going on, but fortunately thingshave perked up." said Bill Enouy, a former schoolteacher who tookoffice abouta decade ago.
"The biggest difference I've noticed in Kirkland Lake now, besides theobvious positive attitude that we have now that we never had for awhile, is theprice of housing. It's gone crazy."
The gold rush here is partly driven by Canada's political and socialstability, even as problems like high crime rates, big tax grabs andpoliticalinstability plague many gold mining hot-beds in Africa and SouthAmerica.
"Costs of production here, on a world scale, are a little bit higher.However, geopolitically, a lot of Canadian miners have found out whatall can gowrong in the world," said Duncan Middlemiss, who manages some of StAndrew Goldfields' mines located 65 km (40 miles) northwest of KirklandLake.
"Miners are certainly quite happy to be in Quebec or Ontario becausethey are known entities and they are mining friendly and that's why youare seeingreinvestment."
EXPLORATION BOOM
Metals Economics Group, which tracks data on exploration spending, notesthat Canada's share of global gold exploration spending has doubled inthelast 10 years.
In 2001 projects in Canada accounted for some 10 percent of the roughly$900 million spent on gold exploration, while in 2010 they accounted for20percent of the $5.4 billion spent, according to analysts at theconsultancy group.
"I still think the best place to find a gold mine is beside one," saidRochelle Collins, a geologist at the Young-Davidson project 60 km westofKirkland Lake that was recently bought by AuRico Gold. "Here in Timminsand Kirkland Lake, most definitely there is more gold to find."
She added: "We are able to go deeper now than back then, when thesecamps were at their absolute peaks. And there are definitelyimprovements intechnology."
There was clearly less focus on getting all of the gold out of theground in the previous boom, because potential profits were smaller inan era whengold prices were low and stable.
"Back in the old days, when the price of gold was $35 an ounce for along time, they started high-grading the mines and just taking out thehigh gradeore and leaving a lot of other ore there, because they couldn't reallyafford to bring it out at that price," said Enouy.
"There's lots of gold left in all the mines in the area, and with theprice of gold being what it is today, it's economic to get that gold outof theground. The best part is ... they've realized they can find newdiscoveries as well."
Long-time prospector Michael Leahy and others believe the area aroundKirkland Lake may even host iron oxide copper-gold deposits on a scalesimilar toBHP Billiton's massive Olympic Dam mine in Australia.
"There is still some good grass-roots potential here," said Leahy, whohas prospected around Kirkland Lake for years. "The subterranean realmis a hugething, just like the oceans, unexplored. All kinds of things can behiding right under your nose."
JIG-SAW TOWN
As with many old Canadian mining towns, Kirkland Lake's history datesback to the early 1910s. The town grew haphazardly around the mines anditsstreets are a maze that appear to be ripped out of a jig-saw puzzle.
The north end of the town is dominated by a large dry hollow, which wasonce the lake that gave the town its name. Filled in with mine tailingsyearsago, the lake has since been dredged, but it is kept mostly dry now toavoid flooding the mine workings that extend deep below the surface.
Although many houses in the area date back to the 1920s and 1930s, housing prices have soared as the area booms.
"I follow the prices of house sales very closely to see how we're doingand a $30,000 house from five years ago is selling at $90,000 to$120,000 now,"Enouy said.
The housing market is so tight that St Andrew Goldfields took a drasticstep and bought two motels in the nearby town of Matheson to use asworkeraccommodation.
While the boom helps eateries and hotels, not all ventures are enjoyingsimilar success. Many miners are transient, with families in nearby hubslikeRouyn-Noranda, Timmins, North Bay and Sudbury, so much of the moneyearned in and around Kirkland Lake, ends up outside the area.Nonetheless localsare upbeat.
"It's been a really nice turnaround for our community, for Kirkland Lake and the whole area," said Middlemiss.
Kirkland Lake Gold was among of the first to spot the opportunitybeneath the former mining camp, buying five of the seven old mines alongthe town'smain strip at rock bottom prices in 2001 and restarting production in2005.
Its Chief Executive Brian Hinchcliffe believes old mining towns are asensible place to operate, because of the strong mining culture thatstill existsin many of them.
"One of the themes we're constantly stressing, not just on our behalf,but on behalf of all the mining companies in the area -- is that thenext 20 or30 years are probably going to be even more exciting for thesecommunities than even the '30s and the '40s were," he said. "We've got abright futureahead."
BIG PAYDAYS
The current boom comes at a time when industrial hubs in southernOntario and other parts of North America are still struggling with highpost-recession unemployment levels.
"It's a pity we can't employ all of the unemployed workers from downsouth, but with the money that's being paid here -- it would be a goodidea forsome of them to wake up and smell the roses and try mining as aprofession," said Leahy. "Miners here are making between $100,000 and$150,000 a year-- pretty good for someone with a high school education."
Kirkland Lake Gold is offering a big relocation allowance to thosewilling to move to the area and seven-day work week rotations to attractand retainpeople.
"Now we are into hiring people right off the street," said Ray Belecque, who manages Kirkland's operations in the area.
Clifford Lafreniere, who owns the local Ford dealership, is seeing hugedemand for trucks, "Not just run-of-the-mill work trucks, but luxurytrucks."
But even he concedes the boom cuts both ways, as small businesses lose good employees to cash-rich mining companies.
The boom here reflects similar revivals in former gold mining camps,like Canada's Yukon territory -- home of the famed Klondike rush of the1890s --or the Carolinas, where the first U.S. gold rush took place in the1800s. Mines dating back to the Egyptian, Incan and Roman Empires arealso beingrevived.
In the Yukon, Kinross's $139 million takeover of the high-grade WhiteGold project last year has triggered renewed interest in the region.Some $260million is being spent on exploration in the Yukon this year, two-thirdsof it on gold projects, said Patrick Sack of the Yukon GeologicalSurvey.
This surge in the number of gold projects has made it hard for miningcompanies to find talent, said Charles Page, the head of explorationcompanyQueenston Mining, which controls one of the largest land-packages in theKirkland Lake area.
With many experienced miners set to retire, the labour crunch mayworsen, as the sector, for the most part has suffered years ofnegligible investmentsand numerous job cuts. Some local colleges are now developing trainingcourses to fill the void.
Northern College, home to the Haileybury School of Mines, has startedshort-term courses in drilling and hard rock mining that are attracting alot ofinterest, especially given the many jobs and lucrative salaries onoffer, said Rose-Lyne D'Aoust-Messier, a training consultant at thecollege.
"When I went to high school there were 1,300 kids in our high school andI just watched one after another just flee, because there was nothingto do.... Now that we are in growth mode, a lot of the young locals arefinding work here and are happy to stay," said Leahy. "We may have acold winter, butoverall Kirkland Lake is heaven."