The Mauney Lease, 1912-
Hoping to consolidate control of the big pipe, Austin Millar began in 1912 with what appeared to be a mutually beneficial arrangement with M. M. and Bettie Mauney. For a 25% royalty, his group leased a triangular 9.46-acre tract including approximately 2 acres of the pipe, along with a five-acre plant site almost 4,000 feet northwest on the far bank of Prairie Creek. The level field between the pipe and the plant allowed the use of a tramway to convey material. Costs of facilities and testing were projected at $50,000 or less.[1]
In early 1913, as the Mauneys began suing to void the lease, Austin Millar completed a modest pilot plant and began using the standard method of testing potential diamond reserves: digging pits and concentrating on the undisturbed peridotite matrix beneath the dark surface layer.[2] Howard stayed mostly at his office in St. Louis, doing some consulting while serving as a co-trustee and administrator of his father’s operation in Pike County. Among other things, he was responsible for sending M. M. Mauney regular reports on diamond recovery.
After weeks of labor, the elder Millar got stunning results from his pits. The first two required reports to Mauney listed six unimpressive diamonds totaling about two and one-half carats. “We may add,” said the report of August 25, 1913, “that 945 cubic feet of the yellow ground [stained by oxidized iron content] lying immediately beneath the black ground was recently washed and treated by us without recovering any diamonds.”[3] A following report in November indicated three finds totaling slightly less than one carat.[4]
As the Mauneys began suspecting fraud, the elder Millar leaned more heavily upon his bright, ambitious son; and in early 1914 Howard left the St. Louis office to an associate, moved to Murfreesboro, and took over the operation. The disastrous pit sampling gave way to a method exploiting more of the relatively diamond-rich surface material. Howard’s mining maps, photographs, and other documents confirm what he later acknowledged, inadvertently, in his memoir:
I changed this [digging pits] to the excavation of a long shallow cut running south to north through the center of the proved diamond-bearing land, and installed moveable track down through the center of this cut, so that cars could be loaded with diamond dirt by men shoveling it in from either side . . .. [5]
The diamond count rose immediately and dramatically. Howard Millar’s next report to Mauney, March 14, 1914, said, “In addition to the fifty seven diamonds shown you recently we have recovered twenty five more up to this date. These are subject to your inspection.” The next report, on March 26, added thirty-four diamonds averaging about 0.10 carat each, and the pattern continued afterward: April 7, forty, including fragments and “sands” (specks about 0.01 carat), a total of five carats; April 20, seventy, including “fragments” and “fractures,” totaling slightly over twelve carats; May 8, one hundred and nine; July 3, one hundred and twenty-two; August 4, two hundred and twenty . . . With the seasonal clean-up in October 1914, the tally reportedly reached about 1,000.[6] This total, however, likely included 107 diamonds recovered between late October 1914 and March 23, 1915.[7]
While projecting optimism, the report of August 4, 1914, did note “an item of vital interest.” A “special careful test” of 250 loads of the “Blue Ground” from near the apex of the mine yielded fourteen small diamonds totaling slightly over one carat.[8] South African miners called the basic diamond matrix Blue Ground because of its natural, unaltered appearance.
That special test was an omen of what was to come at the Mauney Mine. A handwritten report made later at the plant told the story: “May 1 to May 1, 1915-16, Mauney Mine Washing”; 1,782 loads of “hard bank disintegration” and 9,437 loads of “debris and yellow ground”; over 1,200 loads of the “hardbank” yielded no diamonds, while the last 500 yielded less than 0.75 carat.[9] The same report also listed the washing for May 1, 1916-September 1, 1916: “debris and yellow ground,” 4,108 loads, with no yield indicated.[10] The Millars’ later references to production at the Mauney Mine—consistently, 1,000 diamonds—underscored how few were recovered after March 1915.
The Millars’ impressive performance after April 1914 was temporary because their two acres held a very limited reserve of surface material. And compounding that dilemma, the Mauneys were hardly appeased by the reports and the way the diamonds were being handled. In April 1914 both Millars were arrested by court order, prompting Austin to tell his lawyer in St. Louis, “I have crossed Mauneys off my speaking list and if I come in contact with them in any business way they will have ample cause to complain to the Courts that my manner is otherwise than cheerful.”[11] The lawyer, George B. Webster, advised his old friend to avoid “personal controversies with a pole cat.” Mauney’s action “bears on its face evidence of having been concocted in an insane asylum,” Webster said.[12]
Before that episode, the elder Millar had already deferred to the judgment of son Howard, an almost ideal counterpart of M. M. Mauney’s oldest son, Walter; and from the beginning the young mining engineer preferred to fight in court instead of compromising. In late April 1913 the Kimberlite Company’s lawyer, John W. Bishop, thought he could persuade the Mauneys’ lawyer to drop the law suit. Howard, confident of victory, reported to his father: “I told him to go ahead with the case as it will shut Mauney up once for all times.”[13]
Another opportunity for compromise occurred in September 1914, after the limited potential of the leased property was becoming clear. The Mauneys’ lawyer, William C. Rodgers, suggested the Millars receive ownership of the five-acre plant site on Prairie Creek in exchange for a return of the lease.. In addition, the Millars could have “all diamonds found up to and including the last report made to Mr. Mauney.” The proposed settlement was rejected. Austin Millar told his personal attorney, George B. Webster of St. Louis, they intended to hold the lease until they “definitely and finally determine whether diamonds exist in payable or commercial quantities in this Arkansas Kimberlite.”[14]
The Millars also kept fighting for the lease because the Mauney Mine had become crucial to their group’s fundraising efforts in Chicago and St. Louis. The surface mining of early 1914 gave them leverage and they applied it skillfully through an annual prospectus, other literature, and extensive correspondence. In the process, father and son began walking a promotional tightrope.[15]
The elaborate prospectus, first put together in 1912, set the pace by balancing an overpowering imagery of commercial success with a few obligatory qualifications. The initial version highlighted “OUR PRACTICAL PROJECT AND GREAT COMMERCIAL POSSIBILITIES,” the “QUALITY OF THE DIAMONDS OF ARKANSAS,” and the “INEXHAUSTIBLE SOURCE OF SUPPLY,” yet made it reasonably clear that $50,000 was needed to equip the new plant on Prairie Creek for “test washing.” To keep a broad base of potential investors, The Kimberlite Company’s 100,000 shares of capital stock was still offered at $5 each.[16]
The second edition of the prospectus, finished by early 1914, began employing the surface yield. Now the Mauney property was described as the finest diamond source available in Pike County, and current recovery methods were “so perfect that practically one hundred percent of the diamonds are saved.” After citing statistics on average yields of South African Mines—from 21 to 28 carats per 100 loads—the writer said, “We may safely assume from available data of recovery made by the primitive contrivances that our yield at a conservative estimate will average 25 carats per 100 loads.” He qualified that yield by saying it would be the product of a regulation plant, but added, “. . . it is believed even this preliminary test washing will prove very profitable.”[17]
Isolated from events in Pike County, investors in the Midwest responded to the Kimberlite Company’s optimistic statements, and in June-December 1914 their ranks expanded to include at least forty-eight individuals, all except nine of them in Chicago. The entire group, including Austin Millar’s main base from previous years, owned 26,601 shares of Kimberlite stock at par value of $5.[18] The fundraising in 1914 brought in at least $12,000.[19]
[1] Supra, “Northeast Slope-Enterprising Mauneys.”
[2] Experienced miners such as Austin Millar and John Fuller knew a valid test required removing surface soil before taking samples from pits or trenches (e.g., Fuller, Report to Loree, in “Reports and Information,” 18). The Millars kept composite mining maps showing pits and trenches (two are in “Maps, Blueprints,” VI.A-B, Crater archive). The final map, labeled “Developing Work in the Kimberlite Matrix,” indicated depths. Supra, “Mauneys—Battling in the Courts,” reviews the law suits of 1913-1920.
[3] Test reports for the Mauney Mine are concentrated in “M.M Mauney,” I.Y, Crater archive. The first three letters to Mauney, signed by Howard Millar, were dated August 13, August 25, and November 3, 1913.
[4] Ibid.
[5] Millar, Finders-Keepers, 54; composite mining maps, VI.A-B. Consistent with other public comments, there was no reference here to the surface layer and its contribution (cf. the Millars’ court argument in 1919, infra, “Fires”).
The events described in Finders-Keepers are often entangled and misleading, as in this case. Dates are often wrong. While the brief comment about switching to trenches fits the documentary evidence, Millar or the book’s editor rearranged operations at the Mauney Mine and those at the Ozark Mine, which he and his father initially purchased from bankruptcy in December 1914. Moreover, imaginative scenes are injected at certain points. The result is a clash between the account and the facts amply documented in the Millars’ reports to M. M. Mauney in 1913-1914 (I.Y), in their correspondence (I.G-H), and in other files—including the record of an arrest in April 1914 (infra).
Finders-Keepers said that after the bankruptcy sale, “The [Prairie Creek] plant got into operation in July of 1913, and more than a thousand diamonds were recovered during a period of about three months.” These included a “fine white one of about six carats weight” and a “beautiful yellow of four to five carats, which was also of fine quality. Most of the diamonds recovered ranged from one carat to one and a quarter carats” (44; comment on the Ozark sale, 41, 43). These comments clearly referred to the Mauney Mine.
In Finders-Keepers, and in an earlier statement, Howard Millar recalled his father’s anxiety in “1914” over the small number of diamonds recovered, and then ascribed the problem to theft during processing at the plant. Having “strapped on a .45-caliber revolver” and chased off the suspected thieves, Howard supervised all washing and sorting for a few days “and then handed his father 72 gem quality stones and some others” (the abbreviated story as told in Ernie Deane, “Memories of Arkansas’s Famous Crater of Diamonds,” Arkansas Gazette, July 6, 1969, p. 4E). The more detailed account in Finders-Keepers added that the seventy-two gem-quality diamonds “ranged in weight from four and a half carats down to one-tenth of a carat (52).
Acknowledging his presence in Murfreesboro while the diamond count from the Mauney Mine soared in 1914, Millar continued by saying he moved from St. Louis in “December 1914” to take charge of production. “The first duty I had, beginning January 1, 1915, was to make a complete inventory . . ., then suggest and make any necessary changes or improvements”—including the shift from pits to trenches (53-54).
If that were the case, all those diamonds collected in 1913-1914 would have come from Austin Millar’s pits. “He [Austin] had been loading the mine cars with disintegrated diamond ground from small pits sunk by manpower to a depth where disintegration ceased, then move [sic] to another location” (54). In those days, disintegration always applied to peridotite matrix immediately beneath the humus-enriched surface layer, to the solid material weathered and softened by ground water. In the diamond field, disintegrated peridotite usually ran to a depth of at least thirty feet. In the Mauney Mine, which held a large amount of the hardest peridotite (commonly referred to as “hardebank,” or “hardibank”), the overall average would have been less than that. The Millars’ final composite mining map indicated depths ranging 10-40 feet for clearly defined pits (“Developing Work in the Kimberlite Matrix,” VI.A-B, Crater archive).
Notice how the Millars described the last composite mining map, showing trenches and pits: developing work in the kimberlite “Matrix.” The legend of the map said, “Enclosure indicates 214 Proven Claims.” Consistent with this theme, Finders-Keepers said: “Later at a very rich spot [in the initial trench], we started the construction of a shaft for testing the deeper Kimberlite that lies beneath the yellow ground. We sank this shaft to around sixty feet under the surface but could not do satisfactory work to produce diamonds with the present equipment. Tests made showed diamonds in satisfactory numbers, similar to the caratage recovered to the disintegrated yellow ground above it [that is, recovered in the dark surface layer above the yellow ground]” (54-55).
On the other hand, the Millars did leave clear documentary evidence refuting that account. The reports, correspondence, and items are reinforced by a rich photo-documentary of their work, particularly their extraction of dark surface material from shallow cuts (“Photographs,” VIII, passim, Crater archive; almost all of these photos are available on the microfilm of the archive, copies in AHC and Crater). Unlike photos from the Lee J. Wagner collection, the Millars’ were filed in unnumbered folders. A small collection from the “Old Photo Contest” at the Crater, however, has numbered folders (10, 34, and 35 are good illustrations of the Millars’ surface mining).
There is an excellent photograph of Austin and Howard Millar and an eight-man field crew beside a tram unit; all are identified (“Prairie Creek Plant Workers,” VIII, unnumbered folder, Millar, Crater). The file has a second photo similar to that one, with an eleven-man crew. Each photo included four Black Americans. A later shot had thirteen men, including nine Blacks, and tram units pulled by a gasoline-electric engine.
[6] “Mauney,” I.Y. Austin Q. Millar to C. E. Wilcox, Chicago, October 23, 1914: the “clean up” of current test work is expected to show a total of about 1,000 diamonds to date “and justify larger and more economical operation of this first real American Diamond Mine” (“Correspondence,” I.H, Crater archive).
Miser and Ross, USGS 735-I, 318, said the Kimberlite Company recovered 1,500 diamonds on the Mauney property from 1913 to April 1915. The information came from the Millars, and evidently inflated the actual total; the company made only two reports between late October 1914 and March 23, 1915, indicating a total of 107 diamonds for that period (I.Y). The sequence is clear because each report refers to the previous one.
Also consider the “List of Diamonds in Box” (II.N, Crater archive, undated but after 1916) and the large collection of used diamond wrappers (“Misc.” box). The grand total from both the Mauney Mine and the Ozark was 1,821 stones weighing 291.48 carats.
[7] Ibid.
[8] The last composite map, “Developing Work in the Kimberlite Matrix,” indicated the big pit at the apex was forty feet deep (“Maps and Blueprints,” VI.A-B, Crater; evidently this was the “sixty” foot shaft mentioned in Finders-Keepers, ). A handwritten report made at the plant dated the test July 15-16, 1914 (untitled tally sheet, with loads and diamond yield, II.Q, “Misc.,” Crater). The 220 diamonds reported August 4 evidently represented a compensatory assault on the surface layer.
[9] II.Q, “Misc.”
[10] Ibid. The report subtracted 500 loads from this total (“Less estimated on floors”).
[11] Howard Millar to George B. Webster, St. Louis, April 13, 1914, I.H; Austin Millar to Webster, April 14, 1914, ibid.; supra, “Mauneys–Battling in the Courts.” Webster was an old associate, as well as Austin Millar’s lawyer. The correspondence, I.G-H. covers the first law suits thoroughly.
[12] Webster to Austin Millar, April 14, 1914, ibid; Webster to Austin Millar, April 30, 1914, ibid.
[13] Howard A. Millar, St. Louis, to Austin Q. Millar, Murfreesboro, April 28, 1913, I.G. “Don’t worry about the case,” Howard advised, “as the lawyers say we have a clear case, nothing to Mauneys’ complaint. . . . it can squelched in the Federal Court by demurrer.” Two days earlier Howard had told his father, “I am now agreeing with you that it was a good thing this trouble came, for it will clear up matters and leave us much more independent and show them that they cannot fool with us. But it is expensive” (Howard Millar to Austin Millar, April 26, 1913, ibid.)
[14] Rodgers, Nashville, Arkansas, to George B. Webster, St. Louis, September 17, 1914, I.H; Millar to Webster, September 22, 1914, I.H.). No doubt the Millars continued fighting for the lease basically because the Mauney Mine had become central to the Kimberlite Company’s promotional effort (infra). Aside from the almost forgotten Kimberlite Mine up in the hills, the property was all the Millars had in September 1914. The sale of the bankrupt Ozark property was pending; yet, the purchase of that tract still seemed a remote possibility (infra).
[15] Aside from the almost forgotten Kimberlite Mine up in the hills, the Mauney property was all the Millars had in September 1914. The sale of the bankrupt Ozark Mine was pending; yet, their purchase of that tract seemed a remote possibility unless they could get ahead financially.
[16] “Reports,” V.B, Crater archive, holds the twenty-one page bound copy. Photos are included. Generally, the stock was sold through core investors or agents in the Midwest (e.g., W. L. Wilder to Howard A. Millar, June 2, 1915, I.I).
[17] V.B., Crater.
[18] “Shareholders,” Kimberlite Diamond Mining and Washing Company [undated, but December 1914-March 1915], I.W, Crater; “Correspondence,” Austin Q. and Howard A. Millar, June-November 1914, I.H.
[19] The correspondence (ibid.) traces a number of sales appearing on the list of shareholders. Millar’s basic group in Chicago was among those holding at least 1,000 shares each.