Business: Back to the Hills for Gold

Eureka! There is still a bit of gold in them thar hills. In the past three weeks three companies have announced important new discoveries in northern California and Nevada. Homestake Mining Co., the nation's largest gold producer, tapped a vein that holds more than 1 million oz. of gold in California's wine-rich Napa County. Newmont Mining Corp. has uncovered gold deposits near Elko, Nev., that should yield about 440,000 oz. Louisiana Land and Exploration Co. made known last week that it had found ore containing both gold and silver near Round Mountain, Nev.

With the price of gold still surging—one day last week it rose $30.70 in New York, to $680 per oz.—companies are finding it profitable to crush even mountains of rock to extract the shiny metal. Homestake has been spending $270 per oz. to dig gold from a Lead, S. Dak., mine that it opened in 1876. Six tons of ore must be mined in order to get one ounce of gold. Extraction in Napa County will cost between $140 and $190 per oz.

The gold rush is even attracting miners with pick and pan. Some 654 small mining claims were filed in California last month, and as many as 100,000 part-time prospectors now sift through the gravel beds of streams and rivers looking for nuggets that the Forty-Niners left behind. Big companies are having luck but individual miners say that pickings are slim.