A few days after the
Denver Post published its closely worded story about my father’s
Big Indian uranium discovery, Moab’s Times-Independent ran an
article based on the same announcement that Dad had given to the Denver
newspaper. Although the Times-Independent article actually contained
more details about the high-grade nature of the uranium mineralization
contained in the discovery drill core, not a single person among the
newspaper’s readership expressed any interest in helping Dad develop
his prospect. None of the area’s long-time uranium prospectors and miners
were convinced that Charlie Steen had really found a uranium bonanza.
Folks laughed when they heard that someone from Texas was claiming to
have discovered a million dollars worth of uranium in a mining district
that everyone knew the experts had already examined and written off
as a loser.
In early September,
Dad received a letter postmarked Casper, Wyoming from William T. Hudson,
his former boss at the Chicago Bridge and Iron Company’s Houston, Texas
office. Bill Hudson had overseen the college loans that my father worked
off during the summers and had written to congratulate him after reading
the Denver Post article.
AT LONG LAST! Charlie tries on a new pair of boots.
Dad immediately telephoned
Bill Hudson and explained the situation. He told Hudson that McCormick’s
interest was available for $15,000 and that he needed at least another
$35,000 to prove up the ore deposit. Hudson, a family man, told my father
that he couldn’t risk more than $5,000. But he was still associated
with Dan O’Laurie, another of Dad’s old bosses at Chicago Bridge and
Iron. Hudson approached the thrifty O’Laurie about raising the necessary
money. A day later Dan O’Laurie flew down from Casper to size up the
After he saw the drill
core samples and verified the chemical analysis results, O’Laurie caught
some of Charlie Steen’s enthusiasm for his uranium prospect. He put
up $15,000 and agreed to loan the venture another $30,000. Hudson came
across with his $5,000 and Bob Barrett chipped in another $4,500. Dan
O’Laurie and Bill Hudson bought out Bill McCormick and his cautious
silent partner while my father considered his options.
Instead of spending
all of the remaining capital drilling more holes to block out the ore
body, Dad decided to gamble all of the money to sink a shaft down to
the uranium indicated by his single discovery drill hole on the Mi Vida
claim. It was bad geology but good economics, because if they had drilled
more exploratory holes they would have been out of money; but a shaft
would enable them to begin production immediately.
A small crew of miners
was hired and a head frame and hoist house were constructed along with
a bunkhouse and cook shack. On October 4, 1952, a six-by-eight foot
shaft was started thirty feet southeast of the discovery drill hole.
While my father examined and recorded the geology, Bob Barrett oversaw
the shaft sinking, and my grandmother, Rosalie Shumaker, did the cooking.
Dan O’Laurie moved to Moab and handled the finances, and Bill Hudson
anxiously awaited the results in Wyoming. My mother and brothers and
I continued to live in Cisco where our friends, the Cowgers and the
Seeleys helped Mom get along during Dad’s absences.
Two weeks later, my
father drove into Moab and introduced himself to Mitch Melich, the only
lawyer in town. He wanted to form a closely held corporation and he
wanted to name it the Utex Exploration Company after the two states
of Utah and Texas. Melich agreed to incorporate the company and come
on board as corporate counsel in exchange for a small percentage of
In retrospect, it
was a good thing that Moab didn’t offer Charlie Steen a large selection
of attorneys to choose from, because Mitch Melich brought a lot of experience
and ability to Utex. Melich had grown up in the copper mining town of
Bingham Canyon, Utah. He had worked for Kennecott as a young man during
the summers in order to pay his way through college. More importantly,
he was married to Ed Snyder’s daughter. Snyder had been involved in
mining for decades, and he had many years of experience in metallurgy
and mineral processing as president of the Combined Metals Reduction
Company. Mitch Melich and Charlie Steen liked one another immediately.
Melich became my father’s closest ally in the many negotiations and
mining deals that followed this initial meeting.
The Utex Exploration
Company was formed on October 24th, with Dan O’Laurie as
president; William T. Hudson vice-president; Robert M. Barrett vice-president
in charge of mining operations; Charles A. Steen chief geologist and
secretary-treasurer; and Rosalie Shumaker as assistant secretary-treasurer.
Dan O’Laurie’s closest friend, Allan P. Darby, was later appointed assistant
to the president. My father and his mother retained 51 percent of the
corporation’s 50,000 shares in exchange for Dad’s contribution of 12
of his mining claims.
Because the soft sedimentary
rock formations had to be timbered and the waste rock hand mucked and
hoisted to the surface in a quarter ton ore bucket, the shaft sinking
progressed very slowly. Finally, at a depth of 68 feet, the miners blasted
into the Mi Vida ore horizon. My father and his mother and their partners
gathered around the slowly growing ore pile at the base of the head
frame and handled and examined the heavy uranium ore as it was brought
to the surface in the ore bucket.
When the miners had
mucked out the last drill round that had penetrated the Mi Vida ore
deposit, my father excitedly climbed down the shaft ladder and found
himself surrounded by the same grayish-black formation he had pulled
up in his drill core back in July. It was the first time any geologist
had ever seen such high-grade uranium ore on the Colorado Plateau. This
was the reward for years of hardship and privation. This was the fulfillment
every prospector dreams of when he sets out to find a fortune. It was
the first day of December, and it was Dad’s thirty-third birthday. Charlie
Steen had truly struck it rich!
Everybody took the
weekend off so that the Utex insiders could let their family and friends
know that the prospect had become a mine. My father and his mother drove
through Moab in the red jeep on their way to Cisco to celebrate and
make plans with my mother. It was 10 o’clock at night and the whole
town was locked up and fast asleep. A student of mining history, my
Dad knew that his discovery was going to change the time Moab went to
bed. The sleepy little town was about to wake up.
The shaft bottomed
after passing through more than 8 feet of primary uranium ore that ran
between 0.34 and 5.0 percent uranium oxide. During its first 12 days
in operation, the Mi Vida mine only produced 114 tons of ore, but it
averaged over $100 per ton and some of it was worth more than $800 per
ton. And it was almost all profit, because mining and hauling costs
were less that $20 per ton.
father contacted the Denver Post to confirm his discovery. After
they ran a follow-up story about the rags to riches saga of the young
prospector-geologist and his loyal wife, the press descended on the
Mi Vida mine site. In addition to the Denver Post, the Grand
Junction Daily Sentinel and the Salt Lake Tribune wrote
the first of countless articles about Charlie Steen and his uranium
strike. These articles caught the attention of the public and fueled
the rush of people that overwhelmed Moab, Monticello, Blanding and Grand
Junction in search of fortunes of their own.
In the mine: Charlie, Butch and Mark.
The articles that
appeared in mining industry magazines attracted mining companies, geologists,
mining engineers, prospectors and promoters from all points to the Colorado
Plateau in search of another Mi Vida mine. The Big Indian mining district
became the uranium magnet for most of these migrants. More millionaires
were made on the Lisbon Valley anticline than any other uranium mining
area in the United States. Charlie Steen’s assertions that he had found
a million-dollar mine ignited the Uranium Boom.
Although it was soon
obvious that the Mi Vida mine had enough uranium ore to make all of
the principal Utex shareholders wealthy, disputes about the company’s
operation and direction erupted almost as soon as production commenced.
The first disagreement arose when O’Laurie and Barrett leased a two
hundred-by-six hundred foot section of the Mi Vida claim to the G and
G Mining Company without informing my father (who was out of town) or
consulting Mitch Melich (who would have advised against the lease).
Then in the early
summer of 1953, a wealthy man named Dandridge made an offer of $5 million
to purchase the Mi Vida mine for a group of Easterners. He was willing
to pay $1 million down and the balance out of production. O’Laurie and
Barrett wanted to sell out before the mine played out. My Dad refused
to consider a sale before he knew the extent of the Mi Vida ore deposit.
By the time the offer expired, the Mi Vida mine had already shipped
more that $1 million worth of ore and production exceeded 200 tons a
day from the new decline that Utex had to share with the G and G Mining
As a geologist, my
father realized that the Mi Vida ore deposit was not diminishing in
size or grade. He firmly believed that it would eventually exceed a
million tons. A noted Canadian geologist, Andrew K. McGill, my father’s
old boss and mentor from Peru, shared his professional opinion. Andy
McGill had joined Utex and was helping Dad get a handle on the geology
and exploration potential of the extensive claim block around the Mi
Vida mine. McGill thought that the Mi Vida mine was world class, but
he didn’t think much about Bob Barrett’s ability to manage the mine.
In August, 1953, Charlie
Steen was quoted saying that "We need to build a mill down here
to process our ore. I will build a mill in Moab one of these days. It
will also help to serve the many small miners in the area." It
was estimated that a mill would cost between $3 million and $5 million.
Dan O’Laurie refused
to go along with my father’s plans to build the first independently
owned, modern uranium processing mill in America. He pointed out that
Utex didn’t have that kind of money and that the AEC would never negotiate
a buying contract with a single uranium producer. O’Laurie was also
sure that the established uranium processing companies would never stand
aside and let Utex compete with their highly profitable, government
Lines were drawn and
sides were taken. Barrett and O’Laurie thought of their interests in
Utex as an investment. Charlie Steen thought of the Mi Vida mine as
the investment of his lifetime. It represented his success against tremendous
odds. Dad viewed his discovery as proof that all of the experts who
had derided his abilities were wrong. He still harbored a grudge against
the AEC for the things that the government geologists had said about
him and his abilities. In fact, he would not allow any AEC geologists
on the property. When the government wanted to inspect the source of
all of that uranium ore that was over-crowding the buying station at
Thompson, Charlie Steen insisted that no AEC geologists could be part
of the team that mapped and sampled the Mi Vida mine. When he was quoted
as saying, "You know, it’s a funny thing. Before I hit pay dirt,
people called me crazy. When I hit it, they called me a charlatan. Now
that I’ve got it, they call me lucky," he was thinking about those
same AEC geologists. And when people called him lucky he invited them
to come try their luck. There was plenty of unstaked country on the
Colorado Plateau for people who thought that all it took was luck to
Tempers finally boiled
over in October. After a heated argument, my father told Dan O’Laurie
to get out of the Moab office. Then he had the locks changed on the
doors. Later that day, Dad and Mitch drove out to the mine to fire Bob
Barrett as mine manager. In their view, Barrett may have been a good
pinto bean farmer, but his mine management left everything to be desired.
Dad seethed every time he thought about the millions of dollars that
the ill advised G and G Mining Company lease was going to cost Utex.
Things turned ugly and got physical between Barrett and Melich before
that corporate meeting was concluded; but Barrett and most of his crew
left the Mi Vida mine after my father officially fired him. This scuffle
in the cook shack was always referred to as the "Battle of the
Cook Shack" whenever the subject of Barrett and O’Laurie came up
Bob Barrett and Dan
O’Laurie hired a lawyer to contest their ousters as corporate officers
and directors; and they threatened to tie up the Utex Exploration Company
by placing it in receivership. After things cooled down, Mitch Melich
began negotiations to purchase Barrett and O’Laurie’s shares in order
to settle the dispute. My father grew impatient and made them an offer
they couldn’t refuse. He agreed to pay Barrett and O’Laurie $175 a share
for their 18,500 shares of Utex stock.
The transaction cost
my Dad $3,272,500 plus interest. Dan O’Laurie, who had been my father’s
boss when he was a teenaged water boy on a construction site in Texas,
received $2,310,000 in principal payments for his $15,000 investment
(his $30,000 loan had been the first money paid out of Utex’s profits).
Bob Barrett, who had known my father during his hungry prospecting days,
received $787,500 in principal payments for his $4,500 investment and
his helping hand. Ten other shareholders, who O’Laurie had previously
sold 1,000 shares of his stock in Utex to after the mine began to ship
ore, received $175,000 in principal payments. And Max Cohen, a Dallas,
Texas attorney trousered $281,000 for his representation of Barrett
and O’Laurie. Mr. Cohen was the first in a long line of lawyers who
profited from the millions of dollars made at the Mi Vida mine.
The terms of the December
12, 1953 sale and purchase of the stock provided for an initial payment
of $150,000 upon signing. The balance of the purchase price was to be
paid within 10 years with interest payable semi-annually at the rate
of 2.5 percent per annum on the unpaid principal. The sellers didn’t
make much money off the interest, because they were all paid off within
a couple of years. They sold their interests in the Mi Vida mine before
more than 1 percent of the ore body had been blocked out.
An article about the
transaction that appeared in the Daily Sentinel quoted Charlie
Steen as saying, "This settles an irreconcilable conflict of interest."
The story went on to disclose that, "Mr. Steen recently announced
that he is negotiating with the Atomic Energy Commission to build a
processing plant at Moab." The Daily Sentinel also broke
the news that my father had recently optioned the Big Buck claims adjacent
to the Mi Vida mine.
In the next installment,
Mark will describe how Charlie Steen and Bill McCormick helped form
Standard Uranium in order to develop the Big Buck mining claims. And
he will tell how the Mi Vida mine’s cook made $500,000 and why the claim
jumpers missed a $50,000,000 opportunity.