It’s well known that placer mining in Silver Bow Creek and lode, or hard-rock, mining in the veins on the Butte Hill began almost simultaneously, in 1864. With the advent of underground mining for silver beginning in 1875, we tend to think of Butte’s mining story as beneath the surface. But placer mining continued for decades.
Placer deposits form when moving water washes the denser material, particularly gold, into low areas or places along a stream where the water flow slows so that it drops the heaviest part of its load. A river is like a natural gold pan, separating and concentrating heavy gold from lighter rock.
Besides Silver Bow Creek, all of Butte’s gulches were worked for placer deposits, with varying degrees of success. Oro Fino, Whiskey, Missoula, and Dublin Gulches all had placer operations, mostly in their lower reaches where sediment had piled up. One of the longest-lived placer mining areas was the mouth of Buffalo Gulch.
Buffalo Gulch drained from Centerville west of Main Street south past the courthouse, approximately along today’s Alaska Street. It ran down the hill to cross Galena between Colorado and Dakota Streets, and it came into Silver Bow Creek between Montana and today’s Kaw Avenue, just north of the Chamber of Commerce visitors center. By 1884, most of Buffalo Gulch above Galena had been filled in or covered, though it survives to this day as an underground culvert.
In 1906, the placers of lower Buffalo Gulch south of Iron Street were still being exploited, albeit in a rather cursory manner. Al Terrell, whose address was listed as “foot of Dakota Street,” was making “a comfortable living” by screening placer sand to sell for building construction in booming Butte. Terrell had owned the Moonlight Mine but sold it “for a song” before its worth was recognized. Toward the end of his 33 years in Butte, he had eked out a living continuing to find some gold in the lower reaches of Buffalo Gulch where he lived.
The Ophir Mine, and underground operation, stood near Terrell’s home in 1906, in an area where $30,000 in gold dust was taken from the gravel by pan and sluice in 1876. Terrell, who was there then, believed that there would have been more gold produced in Butte in 1877 if not for the Nez Perce War. Terrell rode out with W.A. Clark and others but never engaged Chief Joseph’s forces, and placer mining was “demoralized” that season.
Moving water was a prerequisite for placer mining and often in short supply on the Butte Hill. A small fortune was made by L.A. Barnard, who built the first ditch to bring water to the placers between Montana and Main and south of Iron Street. G.O. Humphreys began construction of a ditch from the Boulder River, including a significant part of a tunnel through the mountains, but they ran out of money and it was never finished. Ditches did bring water from as far away as Elk Park to the placers of Butte.
Most of Butte’s placers were finished by about 1910, except for work by the occasional down-on-his-luck miner. Like many mining areas, there was some rejuvenation of placer gold mining during the Depression of the 1930s, but much of the lower Buffalo Gulch placer, in the area around West Second and Colorado, Dakota, and Placer Streets, had already been built over by then.