Last week was the final episode of GOLD RUSH ALASKA. I have to give the Hoffmans credit for actually mining some gold their first year at the Quartz Creek mine. That being said, the show should be renamed DIESEL BURN rather than GOLD RUSH. The truth of the matter is the Hoffman’s operation was not really mining, but rather running large earth moving machines back and forth on the property consuming large amounts of diesel with the added bonus of finding 93 ounces of gold.
In my research on the top 5 Gold producers in the world, they consumed as a group on average 24 gallons of diesel for every ounce of gold they produced in 2010. I discuss this in detail in my upcoming article. If we compare this to what the Hoffmans did at Quartz Creek, you will realize why the name of the show should be changed.
Here is some basic math from remarks made by the Hoffmans during the show:
Todd or Jack stated that they consumed about $1,000 in diesel per day. I would imagine diesel is more expensive being delivered up there in Alaska. If we estimate diesel ran about $4.00 a gallon, the Hoffmans consumed approximately 250 gallons of diesel a day during their operation. If we also estimate that they only burned this for 90 out of the total 150 days that would be about 22,500 gallons of diesel consumed for the year. Again, these are just ball park figures as we don’t have the exact data.
HOFFMANS = 22,500 gallons diesel / 93 gold oz = 242 gallons of diesel per oz gold
TOP 5 GOLD MINERS = 470 million gallons diesel / 19.7 million gold oz = 24 gallons of diesel per oz of
gold
If we take the Hoffmans total of 22,500 gallons of diesel and divided it by 93 ounces of gold, we would get a figure of roughly 242 gallons of diesel consumed for every ounce of gold produced at Quartz Creek.
In 2010, the top 5 gold miners consumed a total (estimated) 470 million gallons of diesel to produce 19.7 million ounces of gold. This turns out to be 24 gallons of diesel per ounce of gold produced. If we estimate that these gold big cap miners only had to pay about $3.50 (maybe less due to hedging) for diesel, their grand total diesel cost per ounce was:
TOP 5 GOLD MINERS
$3.50 X 24 Gallons = $84 diesel cost per ounce of gold
$84 / $1,600 (average price of gold) = 5% diesel cost per ounce of gold
The top 5 gold miners’ diesel consumption was only 5% of their total cost per ounce of gold. However, if we look below, the Hoffmans spent a staggering 60% on diesel to produce one ounce of gold. This is why I am going to contact the Discovery Channel and have them change the name to DIESEL BURN.
GOLD RUSH ALASKA – THE HOFFMANS
$4.00 X 242 gallons of diesel = $968 diesel cost per oz gold
$968 / $1,600 (average price of gold) = 60% diesel cost per ounce of gold
If we take this a step further and multiply the Hoffmans total diesel usage for the year by the price of a gallon of diesel we have the following:
22,500 X $4.00 = $90,000 total diesel cost for the year
$90,000 / $1,600 (average price of gold) = 56 ounces of gold
I remember Jack coming out and saying that they had mined 15 ounces in four days which brought their total to 70 ounces. This was their breakeven amount which turns out to be about $110,000. We must not forget that they had repairs and other things as well to pay for during the year.
Even though these are rough figures, we can now see that the kind of gold mining the Hoffmans participated in the show GOLD RUSH is not the way to make money… it is a way to make the oil companies money. The Hoffmans consumed approximately ten times more diesel per ounce of gold they produced compared to the top five gold miners in the world.
Some say that the Hoffmans get paid for the doing the GOLD RUSH show. I sure hope they do, because if you figure all the work they did for those five months and each of their crew only got about five ounces of gold… that comes out to be about a salary of $53 a day for 150 day season . This is about $6.62 an hour for an eight hour day. They would have done better working at McFATs.
21 comments:
I hope thes guy's clean up this year. They deserve a big payday
Glad they got rid of harnes, he was dead weight. The old mans back was way worse shape, but he kept at it even through a morfein addiction.
Hated the group when they started. Have more respect for those guy's now.
Asking the Father for help every day is a good move.
buncnh of FRIGGIN bumbling idiots. Abd No, ^ the mechanic dude was not the problem. They buy old, unwanted, rusty pile of crap machines that they find on the side of the road and then blame the mechanic!
Clowns. The whole lot of em!
I hope these guy's get cleanED-up this year...by a pack of wolves working in tandem w/ bears.
Oh yea. Nice work on the article.
It makes for interesting television. Glad you pointed out how little each guy took home. Even if they did reach their goal of 100 ounces each guy would get less than 10k.
You do get paid to be on reality shows. The higher the ratings the higher the pay. I think the alcoholic bunch of guietos on the jersey shore get close to 200k an episode. Gold Rush had really high ratings, I'd say 50k an episode minimum. It all depends on what they can negotiate. Discovery makes it well worth their while, guaranteed. Same with deadliest catch. You think blue collar workers want to be filmed working? Hell no.
T
They should have stayed home, and instead of buying $90k in diesel, they could have bought 2500 oz of silver!
I work with some miners in Colorado and we laughed at them from day one. Anyone that would bring heavy and expensive equipment onto a mining claim without first confirming location of gold reserves and a plan of operation is a joke. It's like they did everything 100% backwards.
If you're unsure of where the gold is located then first things first: Core Drill. Then bring in light equipment for sampling. Only after numerous baby steps are taken do you bring in a full sized wash plants. Basically you sample for the first year or two to prove out the claim and locate gold reserves then and only then do you bring in the big heavy duty stuff. Anyway a good way to flush $250,000 down the drain.
I saw a couple of episodes of the show and fully understand the premise behind "reality" shows is to get adverrtizing from whatever corporation will tolerate their products being advertized during the show.
These guys are obviously a bunch of bumbling rank amatures, that are just trying to support their families.
That being said, you have to remember, they made ALOT more money through their participation in the show than they EVER will tearing up the land for a few ounces of Au
All it takes is a good idea for a show that the sheeple will sit at home and watch.
Hey Doc! What do you say to to this? SD readers should come up with a show of our own about silver stackers and survival preppers. There are enough personalities contributing to your site. We could do segments pertaining to the reasons we stack PMs. followed by on camera interviews about what each of us do to prepare for the economic collapse. The whole show would revolve around SD bullion operations, the web site and the comments forum. It would give the TV guys a ton of fodder to work with. The viewers of the show could sit at home and laugh at all the crazies. In addition it would be a great way to get the bigger message out to the masses.
I think it would totally work!!
I site useless shows like
Comic book men
american chopper
motor city madmen
most dangerous catch
swamp people
sons of guns
pawn stars
vet adventures
storage wars
american pickers
canadian pickers
gold rush
pick a puppy
the biggest loser
love it or list it
all the "ink" shows
axe men
jersey shore
all the "poker" shows
Shit I could go on and on! I would be happy to contribute.
Crazy Canuck
Damn! I totally think we could make some serious fiat from this idea.
We could call the show "prepped"
or Maybe....."silver doctors"
or perhaps....."Bullrun"
how bout... "PMs"
"stackers" would draw in the sheeple
Just sayin
Crazy canuck
The perfect name for the show is:
(it came to me in a flash of ultra-moronic TV goyim
inspiration)
"47"
The absolute stupidest one I could come up with; perfect for TV! Numerological overtones, number title, highly
"occult" yet scientific.......perfect!)
Who cares?? I mean at least they got their assses up off the couch and went and did something. That they happened to go to Alaska and found some gold and all on TV too - who cares how many gallons of diesel it took them to find that gold?? It takes money to make money and unless you're a member of the cast or the crew filming them ALL YOU GOT IS CONJECTURE about how much diesel YOU THINK they happened to use. And THERE'S the problem....too many arm-chair gold mining engineers (or pseudo-experts) that think they really know something, when in fact the guys who know what it takes are right there on TV doing it right in front of you and everyone else. And there you are watching every episode - thinking about how many gallons of diesel they've been using to get at the gold??? Please....
Good show, but the jacko-mole is in dredgeing around Nome!
"Docs Stackers" haha... Inspired by Crazy canuck!! I LOVE IT!!
Danno
Deadliest Catch was a real grabber. These folks had the hardest, most dangerous job in the world. We get hooked by the people who put their butts on the line for little reward.
Crazy C has an interesting idea, maybe a little limited for a TV reality show but fun to think about.
Some of these reality shows have a pretty limited theme but a lot of them have characters that look like my relatives---not the Canadian ones--just the Arkie/Okie ones.
So how do you produce a limited TV series of silver lunatics like us. Maybe if it gets enough coverage we can bring in more stackers.
It has to be a heck of a lot less expensive that chasin' gators, buying pawn crap or dredging for gold. Better crowd of people I expect. I'll handle the guns and ammo part.
Sorry cant watch that show any more
I have grown so tired of Jack & his crap it isnt worth watching
That man is a worthless mouth breathing POS & a waste of skin & air
he needs to go do anything else but be a worthless POS
all he wants to do is dig
a monkey can do his job
As they say in retail, Location, Location, Location!!
The Hoffmans just need to find the LOCATION, and their cost per oz will drop considerably. It's all about the SPOT your scraping and digging in. Some are hot and some are cold.
I feel sure they have learned alot, I know I did.
Hoody Who
even with the ridiculously bad total of 93 ounces of gold over a season...this still makes me want to pan for gold myself in the Alaskan wildernes...especially having stood in a few Alaskan rivers myself...
@ Hoody Who... The couple episodes I watched this year they were running dirty ass water through the wash plant that had clogged grates and mats... They washed half, if not more, of there possible finds right back in the ground... They should have deff researched, tested, and probed more... Dug less... And learned how to better operate the screener/wash plant...
Yes location is important but you need the whole package... I do give them credit for picking up and doing what they did but I feel they could have much better attacked what they set out to do...
Danno
good article about mining costs vs. oz found. Can you estimate what large silver miners spend vs. oz they produce. It's incredible the amount of paper gold and silver (and all other commodities) that trade hands without a single thought of how much time, money, and effort it takes to get out of the ground. With silver hovering around $33, is it costs effective, considering all the expenses?, and diesel fuel is just a very small % of total mining costs......
@ Crazy Canuck
AAMOF I just recently watched a Nat'l Geographic show on preppers. Don't know for sure but one could probably find it on the net. Ratings wise I'd give a 7 or so.
Pretty good for the uninitiated. Just the fact it was aired was interesting in itself. PM's were mentioned along with the rest the story.
Anonymous...(8:12 AM comment). There is what they term CASH COSTS, but this is not the total costs. I have read several articles that state the average ALL IN COSTS for large gold miners is about $900 an ounce.
Now, if we are talking new mines, ALL IN COSTS are more like $1,200-$1,400.
This guest post was just a PUFF-PIECE showing the comparison of just how much diesel small operations use to mine gold. Parker and Dakota Fred probably used anywhere between 150-200 gallons of diesel per ounce of gold that they produced.
As I mentioned in the guest post, the brunt of my research is on the diesel consumption of gold-silver and copper miners. We will be hitting a BRICK WALL when it comes to global diesel production in the next few years. This will put a big STRAIN on the amount of new mines and new production that can come online.
Very few analysts understand this princible.
"We will be hitting a BRICK WALL when it comes to global diesel production in the next few years".
Do you think that's the reason for the push to change over the US large truck fleets to CNG?? The same thing WILL happen in the mining industry, especially in Canada and the US where there seems to be no end to the amount of cheap, cheap, cheap natural gas that's coming online. Your fears of....."peak diesel", especially in the mining space, are premature and overblown.
This is a TV show. I've mined placer gold and I've been in a variety of camps/mines. The only reason these guys mined more than two months, is because they were operating from TV revenue. It's not about gold mining, it's about putting on a show about gold mining - the gold is the plot. The breakdowns and drama, drive ratings up, and sell commercials. In the real world, not one of these guys would have survived in this industry. Discovery Channel gets good ratings for the show, and that is why these guys are still in business... PERIOD! Wait for season 3. I bet they don't show the Hollywood style camping that's happening now, or the security guard, toys, etc. Every problem will be blown out of proportion and it shows little respect for the real miners who toil in the dirt for many years, before they build up to a sizable operation. The Discovery Channel is mining it's viewers, that's about the only real mining going on here. If you enjoy the show, great, but keep in mind this is not the reality of gold mining in the Yukon - far from it.
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