Editor’s note: This story on Dennis Washington coincides with the 30th anniversary of the resumption of mining in Butte on July 16, 2016.
Watching chunks of ore get crushed into money is billionaire Dennis Washington's favorite pastime when he visits the mine he owns in Butte — Montana Resources.
Not so surprising for the Montanan with a Midas touch.
Now 82, Washington has built an empire that includes not only the Butte mine but also rail and shipping companies as well as aviation technology, environmental remediation, and heavy equipment companies. Forbes magazine ranks Washington as the 241st richest man in the U.S. and estimates his worth at $6 billion. Forbes lists Washington as the richest man in the state.
But it wasn’t always so. He started with virtually nothing. The Missoula-based Washington launched his construction empire in 1966 with a D-8 Caterpillar bulldozer, a $30,000 loan, and a contract to build roads for the Forest Service.
Washington believes the key to his success came from a simple formula: hard work and a love for the work. In an emailed response to The Montana Standard, Washington described how he got MR’s — once a defunct mine no one else would buy — Butte operations off the ground:
“I believe (we benefited from) my discipline to be a very hard worker, and (that I) always did the best I could do. (And from) my passion for anything to do with equipment. I also have always pursued opportunities that have come before me with passion and discipline.”
Retired MR president Frank Gardner, 82, attributes Washington’s success — and his Midas touch — to more than that. Gardner, who has known Washington for 35 years, says Washington takes chances.
“He always said, ‘I’m not a gambler, but I’m a risk-taker,’” Gardner said.
IN THE BEGINNING
The story of Dennis Washington is also the story of Montana Resources and Butte. All three are intimately entwined.
When Atlantic Richfield Company bought the nearly 100-year old Anaconda Copper Mining Company in 1977, times were still good in Butte and nearby Anaconda. But it didn’t last.
Gardner, a third-generation Butte miner, had relocated to Butte in the late 1970s after spending a few years working in mines abroad. ARCO hired Gardner to run Butte’s Berkeley Pit — at the time one of the world’s largest open-pit copper mines — and he remembers that by 1979 the operation was losing money.
“ARCO lost $100 million over two years,” Gardner recalls. “We were asking to shut down. There was no hope left.”
By the time the shovels fell silent for good in the Berkeley Pit in June 1983, ARCO had laid off 1,300 workers in Butte. This blow came on top of ARCO shutting down the Anaconda smelter in 1980. These were bleak times for the “Richest Hill on Earth.”
Copper prices were less than 79 cents a pound when ARCO ended its operations. It was costing the company $1.30 a pound to mine copper in Butte, a New York Times article reported in 1982.
Current Butte-Silver Bow Chief Executive Matt Vincent moved in the late 1970s with his family to Butte, where his father, a bricklayer, found plenty of work.
At 13, he distinctly remembers how the closure impacted his family.
“Nobody knew what was going to happen when the mine shut down. It was right after we had put down roots. (My dad) ended up working out of state all the time,” Vincent said.
Don Peoples Sr., who was chief executive of Butte-Silver Bow from 1979 to 1990, said the smelter and mining closures sent “shock waves” through the community. Unemployment in Butte rose to 20 percent. The county’s tax revenue fell sharply.
“A lot of people were really hurting,” Peoples said.
With precipitously falling mineral prices, Gardner’s plan was to close the mine with the hope of reopening it a year later. But ARCO, an oil giant, decided to get out of the mining business altogether and sought to divest itself of the property.
Peoples remembers trying to “shop” the mine around to different mining companies.
“We went to every major copper company. Everybody (but Washington) said ‘bye-bye,’” Peoples said.
WASHINGTON STEPS IN
Washington was willing to take a chance on a mine — and a town — that no one else would take.
“If it hadn’t been for Dennis …” Peoples said, trailing off.
The risk was that much greater because the Berkeley Pit was an environmental disaster. With the closure of the underground mines, the pit began to slowly fill with water contaminated by heavy metals.
The Environmental Protection Agency had declared the Berkeley Pit, Silver Bow Creek, a portion of the Clark Fork River, and the towns of both Butte and Anaconda as Superfund sites in the early to mid-1980s. This made the area one of the largest Superfund sites in the U.S.
When Peoples and Gardner were trying to find a new owner for the mining operation, no one knew for sure what they were buying into — on top of the uncertain commodity prices.
In addition, ARCO made a deal with Butte-Silver Bow that if the county couldn’t find a buyer by 1986, the company would tear down the concentrator, an integral part of the pit’s mining operation. Without that, Peoples felt no one would ever again mine in Butte.
It was September 1985. The clock on the concentrator was ticking. Washington expressed interest.
Washington was busy building a stretch of Interstate 15 between Butte and Helena, Peoples said.
Gardner knew Washington because he had supplied trucks for the Berkeley Pit. Washington showed up to view the defunct mining site with a friend who had experience in scrapping a mine in Wyoming.
But by December 1985, Washington had changed his mind.
Gardner, who said Washington was willing to listen, said he talked Washington into going into a different direction. In his emailed statement to The Standard, Washington explained what happened:
"Frank Gardner had a plan that he felt confident would be successful if we decided to open the mine. ARCO said they would pay until the end of the year for approximately 60 people, which gave us time to do the things we had to get done to make it work: power, smelting, labor, financing. (I believed) in the people Frank put together, and (had) confidence in Frank. The work force wanted to get the mine going."
Gardner said that once Washington made up his mind to reopen the operations as an active open pit copper mine, there was no turning back, no matter what the risks.
“He thinks (things) out in his mind,” Gardner said of Washington’s decision-making process. “Once he’s made a decision, that’s it.”
After Washington bought the operation, he and Gardner flew to Butte. On that day, laid-off miners who had built a giant replica of the Virgin Mary — called Our Lady of the Rockies — atop the East Ridge were putting the final piece onto the statue. Gardner remembers standing with Washington watching the helicopter as it hovered over the ridge. They stood outside of MR’s office building on Continental Drive for the first time.
“They were putting the head on the Lady of the Rockies. That was a good sign,” Gardner said.
Butte-Silver Bow Commissioner Jim Fisher, who began working in the mines in 1975 while still in high school, called that moment, "a spark of light for the community."
HOW MR CAME TO BE
By then, the price of copper had dropped to 60 cents a pound. Molybdenum, a metal used to harden steel, among other uses, hovered at $3 a pound. Within the next seven months, copper slipped again to 58 cents a pound.
“Everyone kept saying, 'We can’t do it,'” Gardner said. “'The mill won’t run.' But he stood with us. It took my breath away, but he said, ‘Let’s go with it,' and we did.”
The Continental Pit, only partially dug under ARCO, became the new open pit copper mine. On July 16, 1986, at 12:08 p.m., the first blast went off on the floor of the Continental Pit, located just east of the defunct Berkeley Pit, launching the new era of mining in Butte.
Now, 30 years later, MR has weathered the ups and downs of commodity prices, taking on partial liability for the Berkeley Pit Superfund site and a temporary closure in the early 2000s. Today, the Continental Pit employs around 350 people and provides some of the highest paying jobs in the county. The mine that in 1986 was expected to have a 16-year operation has a mining permit that runs through 2040.
Of all the businesses Washington has touched, MR might be the one that best proves that the man who started with next to nothing has an almost uncanny ability to turn that nothing into gold — or perhaps copper.
Gardner remembered a joke he told Washington once. He repeated it to The Standard with an impish grin.
“I told him not to buy a mortuary. If he did, everybody would die the next day.”