By Mark S. Bassett
History goes in cycles, just like metal prices. If you live in White Pine County, you watch the price of copper, like other people watch football scores. It is no secret that the price of copper has been dropping for a while now. And the continuous drop means that there is the risk that the copper mine may close. A closure would ripple through the community and put a huge dent in our community. It has happened before and it will happen again, it’s just a matter of time.
White Pine County’s economic life has been linked to mining since the founding of the county back in 1869 caused by the silver boom in Hamilton. Hamilton boomed and busted rather quickly, in about 18 months. It managed to hang on until the copper boom at Ruth. The copper boom brought the Nevada Northern Railway to Ely as well as the county seat in 1906. There were little booms and busts over the years, but it looked like the copper dream would last forever, until, the unthinkable happened, when Kennecott shut down in 1983.
Eight years later Magma Copper bought Robinson and began work on reopening the mine in 1994. In 1996, BHP acquired Magma, and operated Robinson from 1996 to 1999. The mine was closed in 1999 due to low copper prices. Quadra Mining bought Robinson in 2004, and reopened the mine later that year. In 2012 Quadra was acquired by KGHM, a large Polish copper producer. Now four years later the price of copper has dropped from a high of $4.50 a pound to about $2.00 a pound. And the question in the back of everyone’s mind is, “Will the mine close again?” And the reality is, not if it will close, but when will it close and for how long will it be closed, the next time?
I submit after 147 years, it is time to break the boom and bust cycle and diversify White Pine County’s economy. Sounds like a great idea, doesn’t it. Everyone knows we need to do so, but the question becomes, how do we diversify? And the answer is right in front of our face – the Nevada Northern Railway. I need to stress, I’m not talking about the steam locomotives and tourism but rather the economic possibilities of opening the line for freight traffic once again.
Yes, those two rusty rails that run 140 miles across the desert are the key to not only White Pine County’s economic future but also to Eureka and Nye Counties’ economic futures too. People on this planet hardly agree on anything, but there is one thing that they do agree on and that is the size of intermodal shipping containers.
An intermodal container is a large standardized shipping container, designed and built for intermodal freight transport. That means these containers can be used across different modes of transport – from ship to rail to truck – without unloading and reloading their cargo. These containers are the backbone of the global economy. These containers are shipped around the world and it doesn’t matter where they are, they will fit on that area’s trains, trucks and ships. It’s that simple.
If you inventory the transportation assets of White Pine County, you have the railroad, three U.S. Highways and an airport where Boeing’s latest airplane, the 787 Dreamliner, did touch and goes during its testing phase. So we have rail, trucking and air all right next to one another, just waiting for that economic spark to ignite.
The key to White Pine County’s economic renaissance is opening the railroad from the mine to Shafter. Work has already started on opening the railroad. The railroad is open from Currie to Shafter. The City of Ely and the Railroad Foundation have a contractor, S & S Railroad that has opened that track. S & S also has an interchange agreement with the Union Pacific Railroad (UP) and the BNSF Railway at Shafter.
An interchange agreement is key. That means S & S can accept railroad cars from either the UP or the BNSF. Conversely, it means that both the UP and BNSF can accept railroad cars from S & S. To say that this huge is an understatement. That means at Currie, only 60 miles away, we are connected to the international transportation grid!
The next step is to get the railroad open to Ely. The first challenge is opening the railroad crossing at Currie. Once that is accomplished, then the southern half of the railroad can be reached once again. The immediate issues facing the opening of the railroad from Currie south is the Currie crossing, brush, ties and ballast. Nothing insurmountable. Reaching the mine, means repairing the Ruth crossing and making track repairs to the mine. Again, nothing insurmountable. Estimated cost to open the railroad is around $16,000,000.
Why is it so important to open the railroad to the mine? Transportation costs. Railroads are the most economical way to transport bulk materials over land. And you need to think of it as a two street. Not only will the railroad take the concentrate out to the interchange, with the transcontinental railroads but it can also bring in items that the mine and the community need.
Right now on average, 1,000,000 gallons of fuel are burned by the mine in a month. The mine also uses lime and milling media and both of these items can be brought in by rail. And of course the concentrate can move out by rail too. How efficient is rail? If you live in Ely, you’ve seen the concentrate trucks in town. Most of them have a long trailer and a smaller trailer too. The load of three of those trucks can fit in one rail car. That’s right three to one. When BHP was operating, they would be taking sixty loads out at a time. In other words, one train with a two man crew, can carry the same amount of concentrate as 180 trucks. So the train runs to Shafter, drops off the concentrate cars and then picks up the inbound loads. Fuel, mill media, limestone and empty concentrate cars. Unlike the trucks, which come back empty, the train is hauling loads both ways, in and out of Ely.
This saving in transportation costs drops to the bottom line. That means the cost of the mine to produce copper drops. The benefit is when the price of copper drops on the world market, then there is more of a cushion in the spread between the cost to produce the copper and the selling price of the copper. Hence, the mine can stay open, with a lower price for copper because their production costs are down.
As I mentioned earlier the major benefit to the community of opening the railroad is expanding our county’s economic base. If you have traveled to Elko over the course of the last few years, by the Osino exit, you might have noticed some huge buildings with a colorful diesel locomotive parked nearby. This is the Elko Rail Port. What was empty land, is now an industrial center. The Elko Rail Port started as an idea that has grown and blossomed.
The next time you drive to Reno, get off I-80 at USA Parkway and drive south. This is the Tahoe Reno Industrial Center (TRIC). A massive 107,000 acre park that encompasses a developable 30,000 acre industrial complex with pre-approved industrial and manufacturing uses. What was sagebrush a few years ago, is now a massive industrial park that is also home to the new Tesla battery plant. Their website brags about having – “Rail serviced sites.”
To a certain extent, if you build it they will come. We have the rail, the airport and three U.S. highways. The railroad has a lessor that has the experience to open the railroad to Ely. In other words, we have the raw materials in place to develop a new economic future for White Pine County.
Opening the railroad and developing the new businesses will not be easy, BUT, it is doable! The resources and the money is out there. And next time, I’ll go over those resources.
Why go through all of this trouble? I was part of the group that testified before the Nevada State Legislature when the City of Ely received $500,000 to purchase the northern portion of the railroad. One of the things that sticks in my mind from that experience is that one of the people who testified was a White Pine High School honor student. His testimony essentially said, “There is no opportunity for me in White Pine County. So when I graduate, I will be moving away.” Those two sticks of rusty rail that run from Ely to Shafter have the potential to change our economic future and provide opportunities for our youth, right here, at home.
About the Nevada Northern Railway: The Nevada Northern Railway Museum is a designated National Historic Landmark. Voted the state’s Best Rural Museum and the Best Place to Take the Kids by readers of Nevada Magazine, the Nevada Northern Railway Museum also has been featured on Modern Marvels, American Restorations and on PBS. For more information, call 775-289-2085, log onto www.NNRY.com or to get the latest news “Like” the Railway’s Facebook page.
Mark Bassett is the Executive Director of the museum. He can be reached by e-mail: email@example.com; or by first class mail at: 1100 Avenue A, PO Box 150040, East Ely, NV 89315.
Image_0004 Caption: It is January 1999, Locomotive 204 is on the point of a train of 129 empty rail cars being delivered to Ely for the mine. Each car can carry three truckloads of concentrate. That means those cars can handle 387 truckloads worth of concentrate. (Photo by Bob Timko.)