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Commentary

Welcome Back, Hecla


July 26, 2010

By David Bond, Editor
Silverminers.com

Wallace, Idaho " It was an event to behold. Two Fridays ago, Hecla Mining Co., (NYSE:HL) opened an office in downtown Wallace, on Bank Street. Everyone who was anyone here in the camp attended, and an overflow crowd interrupted traffic. Sen. Mike Crapo, Idaho's staunchest supporter of our mining industry, was on hand, along with the usual second from our invisible governor along with various and sundry other big-shots in state and local government.

Two Hecla presidents ago, in 1984, Hecla did a nasty turn and relocated its century-old headquarters from Wallace to the allegedly more sophisticated climes of Coeur d'Alene, Idaho, a small burgh east of Huetter, Idaho, whose sole extractive industry is the mining of tourists (as opposed to elements of real value like silver, gold, copper, lead and zinc). In 1980, Wallace (pop. 900 or so) boasted the headquarters of three NYSE-listed companies: Hecla, Day Mines and Coeur d'Alene Mines. Coeur d'Alene Mines joined Hecla in the diaspora to greater Huetter, and Day was bought by Hecla.

We won't revisit the angst of 1984: suffice it to say that some very unkind cuts by then-Hecla CEO Bill Griffith leaked out of a supposedly closed meeting with his staff, to wit; that Coeur d'Alene's amenities in everything from public schools to public churches were vastly superior to those offered in the Silver Valley. Upon hearing them even Wallace's few denizens never known to cuss were hurling epithets worthy of a Longshoreman's wharf.

The brain-drain we experienced in the aftermath of Hecla's departure was an even crueler cut. Hecla executives had directed the community's culture and guided its tradition of service. Retired Hecla CEO Art Brown was the mayor of Pinehurst; their best and brightest drove the Gyro Club, the Wallace Elks, the Lions, the Rotary Club and even the Masons. You could blunder into any Wallace bistro on a Friday evening and sit down next to someone who'd lived and worked in Africa, Australia, the Northwest Territories and South America. When Hecla (and Coeur, and by absorption Day Mines) quit town, we lost a large part of our soul. It hurt.

Hecla's current management takes a quite a different point of view toward Wallace as did the Griffith and Brown administrations. First, current CEO Phil Baker will argue that Hecla “never really left,” because its flagship Lucky Friday lead, zinc and silver mine near Mullan continues to employ more than 200 directly along with another 100 contractors. Second, Baker has been known to slip in and out of town unannounced bearing donations for such outfits as the Mine Heritage Exhibition, or to some worthy Elks Lodge charity. No press releases or posturings ensue " unlike the heydays of the diaspora, when every daily issue of the Coeur d'Alene Press carried grip-and-grin photos featuring another displaced Silver Valley mining executive donating a check to the Hayden Lake Country Club.

(Baker's personal outreach to originals like the late Harry Magnuson and to Bunker Hill Mine owner Robert Hopper have been the mining-industry-equivalent of Henry Kissinger's famed “shuttle diplomacy” with China and Russia. Fences ripped asunder more than 25 years ago are quietly being mended.)

Hecla's “return” to Wallace " one can certainly side with Baker's point-of-view that as the county's largest private employer and taxpayer it indeed never left " is at minimum a symbolic recognition of its deep ties to the Coeur d'Alene Mining District.

At best it's a harbinger of Hecla's commitment to the sustainability of the Lucky Friday Mine and their 21-square-mile land position here. Lucky Friday has more silver ounces in its reserves now than ever in its 50-year history, hinting of another 40, or even 50, years of productive life. Persistence pays. A lesser company might have walked away from Lucky Friday during the lean years, as Asarco and CDA Mines did from the Galena and the Coeur, as Sunshine Mining Co. did from the Sunshine Mine, and Gulf Resources did from the Bunker Hill. Hecla hung in here and the cows are now coming home. They have earned the fruits of America's greatest mining district.

Most important: Hecla's current management is taking a blinders-off new look at the Silver Valley, having identified so far four new areas of interest. To quote from their website: “Hecla is looking at this old district in a new way. Successful exploration of old districts usually comes about as a result of people thinking about the geology differently, and that’s what Hecla’s geologists are doing here. They take the historic information and geologic data and reapply it, but without limiting themselves to historic thinking. They have the advantage of new technologies that allow them to take both a more comprehensive and more detailed look at the whole geologic structure of this great mining district. They are already identifying many prospective targets in this long-term exploration effort.”

We welcome Hecla back to town. As well Wallace, and the Silver Valley, should. Let us toss out the epithets of “historic thinking.” In this brave new world we need each other and together, we might just weather the gathering and gloomy economic and political storms.