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Historical Context

In 1902 the Yale Mining Company (reformed in 1904 as the Daly Reduction Company) selected the Twenty Mile Creek basin for development of the mining infrastructure and townsite. The Similkameen Valley Gold Rush was on and hundreds rushed to Camp Hedley for work and with hopes of gold. One of the first projects to get under way was the need for a steady water supply; preliminary surveys of Twenty Mile creek for a water flume and tramline began. Clearing the right of way, bringing in milled timber that was hauled in by horse teams, and then carrying to where it was built into trestles for the flume took a lot of brawn and inventiveness. Finally, in 1904, six years after Wollaston and Arundel's lucky discovery, the mill and its infrastructure now in place, the Daly Reduction Company began full operation and the muffled roar of the machinery became a familiar sound in Hedley 24 hours a day for most of the next 50 years.

By 1907 Camp Hedley had become the most important mining operation in the Similkameen district with the Nickel Plate mine one of the largest producers in Canada. At the work site good ore continued to be located and approximately 42,000 tons per year were going to the mill. At the mill, gold was being recovered three ways: First there was the free gold that was taken directly off the bars of the large stamps that were used to crush the ore. In addition, gold was recovered from a cyanide bath process; each month a gold brick was produced from these two processes and shipped under special escort to Penticton British Columbia. Finally, the heavy concentrate from another part of the operation, after some initial drying, was being shipped in 100 pound sacks to the smelter in Tacoma, Washington for further refining. Eventually the upward mining activity broke through to the surface. Additional work produced a huge glory hole (open pit). Once the ore around this glory hole was exhausted another adit was driven, in 1908, at the 5600 foot level. This adit encountered very little ore.

Thinking that the ore was exhausted, the Daly Reduction Company sold the operation to the Hedley Gold Mining Company in 1909. The new company, which was backed and promoted by United States Steel, located ore that the previous group had missed, and for the next quarter of a century the mine did extremely well. Production was increased to over 75,000 tons per year, recovery procedures at the mill were improved, and dividends in 1912 reached 30%. With increased production came the need for more power. In 1911, in order to provide additional water for the steam plant, the only source of power generation, a 7000 foot long ditch was constructed to convey the water from the melting snow on local mountains to Strayhorse (Nickel Plate) Lake which empties into Twenty Mile Creek. More power was needed and in 1915 a 2000 horsepower dam was completed on the Similkameen River just below the outlet of Twenty Mile Creek.

Unfortunately, this power plant would sometimes be forced to shut down because of ice on the river. In 1920 and again in 1925 the entire mill had to be closed for the winter due to shortage of water and the resulting lack of power. For the first time since the mine started the future looked bleak when in 1929 new ore could not be located. Over 20 miles of diamond drilling had had been done, but nothing looked promising. For the 75 men underground and the 25 on the surface the end seemed near. To make matters worse the company had not been able to purchase the tiny Mascot fraction from Duncan Woods, the stubborn owner of the Mascot Fraction. After 27 years of operation, the Hedley Gold Mining Company shut down and offered to sell the entire operation for only $65,000.

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