Secret '63 mine discovery shocks the world

TSX trading smashes NYSE’s ’29 records

SEC cracks down on insider trading

Junior mining finance moves to Vancouver

Canada’s top female miner behind bars

The incredible story of Kidd Creek:

Timmins, Ontario, 425 miles northwest of Toronto, is a small mining town.

In 1909, Harry Preston, knee-deep in a swamp, strikes gold. Literally.

He trips. His boots tear off moss, unveiling a golden bonanza.

The “Big Three” mines—Dome, Hollinger, McIntyre—emerge that crazy year.

More than 50 mines are found near Timmins, yielding production of over 70 million ounces.

$140 billion in today’s cash. But in ’63, Timmins is in a lull.

The Big Three, once giants, stagger along.

Enter Texas Gulf

The Houston-based Texas Gulf Sulphur Company is drawn to Canada’s mineral wealth. By ‘63, they’ve burned $3 million drilling 70 duds.

Ken Darke, UBC grad, joins in ’57, craving wild geology adventures.

In ’58, Darke survives a brutal plane crash up north. 87 hours in snow, then rescue.

North of Timmins, Darke spots interesting rocks coinciding with a big geophysical anomaly.

Texas Gulf spent the next 4 years trying to secure the ground from a prospector’s estate.

In ’63, they finally get it for $500 and a 10% gross profits royalty.

Eager to explore, Darke skips his vacation for Timmins. During the fall of ’63, he’s mapping anomalies. “Maximum amplitude.”

November 11, drilling starts, plunging straight into Darke’s dream.

That night, driller Rene Gervais bursts into Darke’s motel room, panting. He’s holding rich copper drill core, covered in mud. It’s shallow, just 20 feet down. Darke’s mind races, sleepless.

Hiding the Find

The first hole completes to over 600 feet. It grades an average of 1% copper, 8% zinc, and 4 ounces per ton silver. A major base metals find.

Darke smells a stampede coming. Every Canadian miner would rush in.

He has to grab more land, fast.

Darke camouflages the drill site. Plants trees, hides tractor marks with pine.

Shifts the drill-rig to a decoy spot.

Bribes the drillers with cash and booze to stay quiet.

Texas Gulf gets sneaky. Core samples are flown to Salt Lake City, despite testing labs nearby.

Yet, Timmins’ bars buzz with rumours. News is leaking.

Reporters and sharks swarm by Christmas. Has Texas Gulf found nickel? They attempt to shrug it off, somewhat telling the truth.

Their ‘63 report barely mentions Timmins.

All winter, they’re grabbing land. Over 60,000 acres, discreetly.

Meanwhile, Texas Gulf’s own, including Darke, are buying stock. Quietly, greedily.

Anticipation Builds

March 30, ’64. Drilling’s back. Two more holes hit the jackpot.

But mum’s the word from Texas Gulf.

April 9, whispers of a big find hit Toronto’s Globe and Mail newspaper.

April 11, New York Herald Tribune blasts it on the front page.

Texas Gulf plays it cool. Exaggerated rumours, they say.

On April 16, the moment of truth arrives. In a dramatic press conference, Texas Gulf unveils the monumental discovery.

Stock Market Frenzy

Next day, Toronto Stock Exchange trading volume beats Black Tuesday ’29 in New York.

Texas Gulf shares, $17 ¾ in November, soar to $58. Soon, they’re touching $130.

Hysteria grips brokerage firms. Some penny mining stocks are up 10X in hours.

In the ensuing rush, it’s the brokers, prospectors, and promoters who come out on top.

‘This is the biggest day of my life,’ Nedo Bragagnolo, Timmins Realtor, exclaims. After staking 270 claims, tipped off by Texas Gulf’s helicopters, he earns millions selling these claims to incoming explorers.

Windfall Debacle

Viola MacMillan, a Canadian mining icon, stood barely 5 feet tall.

Prospecting since ‘23 with her husband. She grew to finance and build mines.

Serving 21 years as president, she made the Prospectors & Developers Association huge.

At 61, post-heart attack, semi-retired Viola catches wind of Texas Gulf’s score.

April 25, the MacMillans hit Timmins. Ready for action.

The MacMillans deal through Windfall Oils and Mines. Grab 12 claims near Texas Gulf from prospectors Larche & Mackinnon.

Drilling kicks off July 1. By July 7, whispers of their own big find. Potentially a major suitor.

Windfall’s shares hit $5.70 by July 27. 40 cents just a month prior.

July 30, the bubble bursts. Windfall’s got nothing. Market chaos ensues.

Shares reopen at 80 cents. Other Timmins’ stocks nosedive.

The ensuing media frenzy leads to the formation of a royal commission, putting the MacMillans under intense scrutiny.

Did they know it was a bust all along? Viola traded 40% of Windfall shares allegedly, pocketing $1.46 million.

Windfall investors lose $2.7 million.

The investigation exposes Viola’s involvement in ‘wash-trading,’ a deceptive practice where she traded shares with herself to create an illusion of market activity.

In ‘68, she’s convicted of fraud. Nine months’ sentence, nine weeks served.

Viola exits the mining scene, for good this time.

Hangover and Regulation

Post-Windfall, Toronto Stock Exchange clamps down. New rules everywhere.

Penny stocks flee Ontario. Vancouver Stock Exchange takes over.

Meanwhile, the SEC’s on Texas Gulf’s trail. Insider trading allegations.

The case redefines when companies must spill the beans, and how executives can trade.

It becomes a cornerstone of U.S. securities law.

Texas Gulf successfully defends a $400 million suit from the prospector’s kin.

The Ontario Court chops off 100 heirs.

One lucky step-child grabs the whole pie, selling the royalty back to Texas Gulf for $27.5 million in ‘69.

A Scientific Wonder

The Kidd Creek mine, however, is unstoppable, opening in ‘66.

A colossal, low cost base metals mine.

57 years later, Glencore’s running it.

It’s the deepest base metal mine ever, some 10,000 feet.

Longest ramp in the world, from top to bottom.

In 2009, a surprise discovery emerges: water deep in the mine dates back 1.6 billion years.

This isn’t just old water. It hints at deep, ancient life.

Maybe, just maybe, it’s a clue to life on other planets.

Kidd Creek Legacy

Kidd Creek, like a wild beast, unleashed a market frenzy.

Booms, busts followed. None matched its chaos. No deposit like it was ever found.

Viola MacMillan receives a full pardon years later. Her legacy outshines Windfall, she’s inducted into the Mining Hall of Fame in ‘91.

In Ontario’s muskeg, fortunes swayed, careers swung, finance shifted.

Prospecting continues near Timmins today.

Sources:
In the Muskeg with Two Billion Dollars in it (Macleans 1969)
The Billion Dollar Windfall (Mortan Shulman)
Boom Times at Timmins (Macleans 1964)
The Kidd Creek Saga (Northern Miner 1988)
Obituary: Kenneth Darke (Northern Miner 1999)
Fleecing the Lamb (1987)
The Story of Viola Macmillan (Youtube)