Lin Ma Hang Mine Part 3 – Exploitation

February 27, 2023 Tymon Hong Kong Companies, Mines, Quarries + Dredging

Tymon Mellor: For eight years, Morrison Brown Yung developed the Galena mine at Lin Ma Hang. He excavated the access tunnels and located the main ore body, but with the fall in lead prices as a result of the Great Depression, the mine was un-economic to work. Following his death in 1933, the mine was eventually taken over in 1937 by Hongkong Mines Ltd encouraged by rising lead prices, and prompting the company to invest in new equipment and to resume production. Unfortunately, one of the catalysts for rising lead prices, the Second World War, was about to directly impact the mine and ultimately seal its fate.

This article discusses the abandoned mine workings at Lin Ma Hang. These workings are extremely dangerous with unsupported tunnels, open shafts and unstable storage of mine waste. The workings should not be entered.

Rise in Commodity Prices

As the world recovered from the Great Recession, mineral prices started to rise once more and by 1936, interest in mining in Hong Kong had resumed. J H Marsman & Co, a large mining company operating out of Manila was awarded a 21 year lease for the Needle Hill mine in the summer of 1936. Representatives from Marsman paid a visit to the Lin Ma Hang site on the 8^th July, 1936 and in a report to the Government dated 23^rd September, 1936, their geologist G H Newman concluded “The preliminary examination seems to indicate the possibility of sufficient quantities of this ore [Galena] to be of commercial interest, particularly if other similar deposits can be found elsewhere, as a reduction of over head charges would result.”

Following the death of the mine owner Mr Yung in 1933, the mine fell in to the hands of the remaining five shareholders. The mine’s operations were sublet to an organisation who undertook “hand-picking on the surface by a few coolies”. There was estimated to be 20,000 tons of ore lying at the surface waiting to be crushed, but with low ore prices, there was little interest in processing it. By July 1936, the administration of Mr Yung’s estate was finalised and with rising ore prices a number of parties became interested in acquiring the mining rights.

In September, 1936, a Mr Sander representing Marsman offered to purchase the mining rights for HK$60,000 and a half-share of the profits. This was unacceptable to the remaining shareholders.

On the 24^th October, 1936 there was an announcement in the Hong Kong press that a new company, Hongkong Mines Ltd was to re-open the Lin Ma Hang mine and the company would be floated in Hong Kong in the near future. The company would have a capital of HK$2 million to be divided into 10 million shares of 10 cents each. Mr J F Manning, a Consulting Engineer had prepared a report for Hongkong Mines on the commercial viability of the mine. The company planned to erect a 50-ton per day processing mill with the ability to increase the capacity to 100 tons if necessary. To support the mine operation, a camp would be constructed for “seven Europeans and approximately 500 coolies”.

With the price of lead rising from less than £9 per ton to £18 10s per ton by October, 1936 and £26 per ton by the end of the year, the prospects for the mine looked positive.

Hongkong Mines was formally registered on the 18^th November, 1936 and a prospectus was issued on the 30^th November, 1936. Much to their disappointment, the company received only $302,985, well short of the HK$1 million required to start the mine.

In early December, 1936 Hongkong Mines announced that they were in negotiations with Marsman to invest in the mine and on the 8^th December, 1936 it was announced that Marsman would invest HK$1 million, sufficient to re-commence mining operations. However, this money was not received and by the 18^th December, 1936 Hongkong Mines announced that they had accepted an alternative proposal from L R Nielson & Co of Manila who would take a controlling interest in the mine.

In return for funding Hongkong Mines, L R Nielson & Co was to receive 1,500 pesos per month during construction of the mill, followed by 2,500 pesos per month plus 10% of the net profits after the mill was operational. The formal business certificate was issued allowing business to commence on the 1^st January 1937, and Hongkong Mines held their first shareholders’ meeting on the 28^th March, 1937.

By early January, 1937 the owner of L R Nielson & Co, Mr Laurie Reuben Nielson, had started work on his new investment. He had ordered from the Denver Equipment Company of Colorado, a 150 tons per day crushing and processing plant. This would produce HK$200,000 of lead and zinc a month and was to be delivered and operational within six months. To allow the speedy commencement of operations, he proposed to procure machinery and accommodation from the recently completed Jubilee Dam (now known as Shing Mun Dam) project. He had requested to build a new road to the project site but this was rejected by the military. However, he was confident that this could be overcome.

In early February, 1937 a large contract was awarded to construct a “small township” at the site of the mine. This would consist of “large canteens and quarters for European and Chinese employees, machine shops, office buildings, assay laboratory, hospital, three executive staff residence and a mill building”. These were all to be completed by the end of May, 1937 when the crushing mill components were due to arrive.

The mine was to be operated by Chinese labour, with a large number of Filipino workers to be brought over from Manila to teach the Chinese how to operate the machinery and manage the mining operations.

At the first shareholders’ meeting of Hongkong Mines on the 28^th March, 1937, Mr Nielson set out his plan for the company. He addressed the meeting and advised that there was now a definite programme to put the mine back into production. Samples of the ore had been taken to Manila, where metallurgical tests were undertaken to establish the quality of the ore and the best approach to processing.

Work at the mine site commenced on the 12^th January, 1937 with the construction of the buildings commencing in February, 1937 using “hollow Spuncrete tile and tile roofs or steel trusses and GI roofing”. The mill machinery had been ordered and the first deliveries would arrive in March, 1937. A contract had been awarded to CLP to provide power for a maximum load of 700hp, and a small emergency generator would be installed in case of power failure. The new plant would be operational in June, 1937. He noted that “Not only will this plant be the first of its type in Hongkong but will be one of the best constructed and laid out in the Orient”.

Present at the meeting representing the shareholders and secretaries were, Mr Nielson, C C Stark as the Chairman, George Scholey Nielson as the Chief Engineer, Davis Wai Kwok Au, J M Wong, W G Poy and T A Martin. George Scholey was a well-respected American mining engineer who lived and worked for most of his life in the Philippines. He is credited with the development of successful underground copper mining operations around Baguio in northern Luzon, Philippines, using block caving techniques imported from Arizona, USA. He died in 1979.

By March, 1937 construction of the mine facilities was nearing completion and delivery of the mill equipment had started. Hongkong Mines had concluded the purchase of all the former owners’ shares for US$100,000 and the Government formally transferred the lease for Mining Lot No. 3 to Hongkong Mines on the 18^th March, 1937. The mining area was also increased from the original 150 acres or 60 hectares to “approximately five square miles” or 1,294 hectares.

In June, 1937 the power supply was commissioned and three compressors producing 600 cubic feet per minute were put in to operation, along with all the pneumatic drilling equipment. Mining staff were transferred from Mr Nielson’s Philippines mining operations in Tinango, including Mr W Fowler as the mill superintendent, Mr Sam Coldren as mine superintendent, and Mr C G Brown who was in charge of the mechanical plant.

However, there were delays in the commissioning of the new mill and it was not ready until October, 1937 with the first production run recorded as taking place in November, 1937.

Who Was Mr Nielson?

Details of the early years of Laurie Reuben Nielson are sketchy. It is recorded that he was a British man born in 1902 living in Christchurch in New Zealand, and that he later married an American lady called Annette. For this article, I have managed to contact his remaining son Lindsay Nielson, who now lives in the USA and he has provided information and photographs of his father:

“he started out as a salesman for a check protector company (it would perforate the numbers into a check to prevent forgeries) he and my mother were given the Hawaii territory in the early 1930’s where he caught the eye of a stock broker who asked him to come to the Philippines to get involved in the stock brokerage business. He obviously did very well because he formed his own company, L R Nielson & Co., which was into stock brokerage, mining and various enterprises. He built Nielson airport, the first civilian airport in Manila and was an advisor to the Mayor of Manila. He and my mother had a home on Manila Bay on Dewey Boulevard. His office was in the Escolta District in downtown Manila. My mother had her own business called the Caravan, she dealt in antiquities and custom furniture made in China. General MacArthur and his wife, Jean Faircloth, were customers. They were a power couple in pre-war Manila. My father was obviously a dynamic, creative person and I regret that I never got to know him. Just another casualty to the war.”

It is reported in a number of web sites that he was a director of the Hong Kong-Shanghai Bank, I contacted the HSBC archive to see if they had any details on Mr Nielson. They reported that they had no evidence to indicate that he was a board member of the bank during the 1930’s. They checked their records for both Hong Kong and Manila, but could find no reference of him.

Nielson enjoyed the Manila life. He was an avid sportsman and a member of the Wack Wack Club where his game was handball, and he and his partner were the handball champions.

The Wack Wack Club would hold balls and parties and Nielson was a regular attendee.

Nielson was an avid aviation enthusiast, owning his own plane that he would fly for work and pleasure.

Frustrated by the lack of a civilian airport in Manila, Nielson prepared a proposal to construct a civilian airport and with a number of other Manila-based foreign investors, they constructed an airport on 42 hectares of leased land in Makati. When the airfield was opened in July 1937, the Nielson Airport was advertised as the biggest and best equipped in Asia.

Unfortunately, the facility was extensively bombed during the Pacific War and never reopened. It was re-developed and is now Ayala Avenue and Paseo De Roxas in the Makati Central Business District.

In the late 1930’s Nielson took up residence in Hong Kong as he developed the Lin Ma Hang mine. He had a house at Repulse Bay, the white building in the photograph below.

In late 1941, with the Second World War consuming Europe and with Japan sweeping through south east Asia, Laurie and Annette adopted two boys Lindsay and Laurie. Laurie was the grandson of Annette and Lindsay was an infant in Manila, born 30^th October, 1940. Within a few months, Manila would fall to the Japanese and their world would change forever.

With the invasion of Manila by Japanese forces in 1942, the Japanese authorities detained Nielson and his family. Nielson’s wife and two young sons were taken to the internment camp at the University of Santo Tomas and held for three and a half years until the end of the war. Nielson being a British citizen, was taken for internment in the Stanley Camp in Hong Kong.

Nielson was active in the Stanley Camp life, being elected to the Camp Temporary Committee in January 1942, chairman of blocks 2 to 5, a District Representative and providing support to the other internees. He got into trouble in June 1944 when buying doors to make a coffin for the recently deceased Mr M J Flaherty. He faced a camp tribunal where it was deemed that doors would be recognised as communal property. However, he was acquitted.

After the liberation of the Philippines from the Japanese, Nielson’s businesses and most of his properties were all gone. His home in Manila was destroyed by a direct bomb hit and his mines were in disarray. Following their liberation on the 3^rd February, 1945, Annette and her two sons left Manila and returned to the USA, unaware of Mr Nielson’s fate.

Details of Nielson’s life following the war are sketchy. He seemed to spend his time between Hong Kong and Manila trying to resurrect his former companies, and he also remarried a lady called Elizabeth. He spent time at Lin Ma Hang trying to restart production and in December, 1953 during a visit to the mine he noted that waste rock had been thrown down ore passes, as well as being accumulated in the driveways, blocking these passes and restricting access and ventilation. There was a complete lack of timbering and support for weaker areas. Nielson concluded that the mining operation was hazardous and contrary to good mining practice. An eye witness who accompanied Nielson on his visit, reported that Nielson’s displeasure was vented by “showering the men with cursing and swearing for their bad work”.

Things were not much better in Manila. Following the war, a commercial dispute arose over war damages, resulting in a Supreme Court judgement between Nielson and the Lepanto Consolidated Mining Company, the management contractor for the Leanto mine. The Nielson company eventually lost the case in December 1966. Not that Mr Nielson would have been affected by the outcome as he died on the 9^th December, 1957 in Manila. The exact cause of death is not known, but an obituary in the South China Morning Post records that “Mr Nielson underwent an operation in August this year but was admitted to hospital again last week”.

Following the war, he never returned to the Unites States and his sons thought he had died in the war. Given all his achievements and success in business, he was clearly a competitive sportsman and as some one driven with a passion, he clearly wanted to do things in a professional and safe manner, and would not accept sloppy practices. He was a man who would get things done.

Mine Production

With the completion of the mill in November 1937, production recommenced. In addition to the Galena ore, small amounts of silver and copper were recovered.

In 1938, the mine operated with eight European and American managers and with a labour force of 500, with 350 underground and 150 on the surface. Safety had been a concern following a number of fatal accidents in 1938, and as reported in the Report by the Senior Inspector of Mines, Perak, Federated Malay States, the accidents were “mainly due to the lack of skilled labour which is not available and in consequence the carelessness of the individual miner”. The report noted that as the labour force became better acquainted with the work, safety would improve.

When Hongkong Mines took over the Lin Ma Hang there was over 2,130m of tunnel excavated and multiple entrances. A further 850m of access adits were driven and 530m of production adits. To achieve the necessary volume of production, mining was undertaken at multiple levels and locations. The majority of the early production was from Levels 5 and 6, with the ore being dropped down shafts to the Level 3 adits from where it was hauled out to the surface in mine carts and dropped into the mill bins.

Ore was also extracted from the level 6 adits and taken by mine cart directly to a stockpile area where it was dropped down a wooden chute into the mill crusher. The Levels 1 and 2 workings by the access road were also worked, and is described as producing the best ore. The material was dropped to the level 1 workings and carted around the hill to the mill for processing.

A numbers of excavation methods were adopted to extract the mineral. In the upper levels the Galena bearing mineral vein dipped at about 35˚ and the ore was mined out and removed using a modified cut and fill method using a slusher, a drag box or scraper dragged along the face. In the lower levels the mineral veins were vertical allowing the ore to be mined out from below with the gangue (unwanted) placed to fill the previously excavated area.

Mineral extraction was undertaken by drilling holes using a pneumatic drills powered via an 8 inch compressed air line which was fed by two 600 cu. ft. Broomewade compressors and one 250hp Ingersoll Rand compressor. Explosives were then used to blast the rock, shattering it into small pieces for removal. Steel tram lines were installed in the main levels and outside the mine to allow hand pushed mine cars to move the ore around. Stores and consumables were hand carried up the hill to the upper levels from the main compound.

Mineral Processing

Once the ore reached the mill, it was fed by conveyor into a jaw crusher, reducing its size to less than 40mm, after which it was transferred to a 30m long sorting belt for hand removal of any free waste.

After the sorting belt, the ore was fed from a 525-ton ore bin feeding a 1.2m dia x 1.2 ball mill, where the ore was ground to less than 0.2mm, in a closed circuit with a 1.2m Dorr classifier. Flotation reagents (flocculants) were added both to the ball mill feed and directly to the rougher flotation cells to generate a froth and aid mineral separation. With the froth, the Galena was readily floated and separated using a bank of 10 Denver Sub-A cells. The concentrates were thickened using a 4.8m Dorr thickener and filtered using a 3-leaf American filter (filter press), from where they fell directly to a drier on to the floor below. The tailings first passed over a shaking table to monitor losses, and were then thickened prior to discharge using a 12m Dorr thickener to the tailing dump.

Commercial Operation

Having increased from £9 per ton in early 1936 to a peak of £37 per ton in 1937, the price of lead dropped to around £13 during 1938, forcing the company to reduce expenses. The lead was being sold to European smelters and with the falling lead price, the mine tried unsuccessfully to negotiate long term supply contracts but the market was in too much flux. To reduce the unit production costs, the mill capacity was upgraded to 250 tons/day along with the installation of a second jaw crusher.

Through 1939, the price of lead remained low at £14 per ton but the mine achieved a working profit of $75,000 for the year. However, once machinery depreciation was taken into account, the mine continued to make a loss. It was noted at the Annual General Meeting that the average price of lead over the preceding 20 years was over £23. The price would recover and the mine would be profitable.

By 1940 new ore bodies were located, with an estimate of 120,000 tons of ore averaging 10% lead and 1.5 ounce of silver per ton. The mine was selling much of its product, 5,000 tons of the 7,000 tons produced to the British Government. However, to help improve profitability a smelter was commissioned in June, 1940, allowing the ore product to be converted into lead and sold directly to the local market. This would attract a better return for the material. The smelting process would also generate sulphuric acid that was sold to a local Chinese concern.

Towards the end of 1940, access to the European market for the product was curtailed by the war and instead regular shipments of lead concentrate were sold to Japan with 2,300 tons being shipped in October, 1940. Ironically, the same lead may have returned in the form of bullets during the occupation of Hong Kong the following year.

Changing Environment

At the Executive Council meeting on the 9^th December, 1936 the British military responsible for the protection of Hong Kong were concerned about the frontier area, the land boundary with China as the civil war continued in China. All applications for prospecting licences along the border or Frontier as it was called would be refused due to military concerns. The military also objected to the upgrading of the Lin Ma Hang road which was the access to the mine.

The situation across the Border deteriorated, with the fall of Guangdong to the Japanese on the 23 October, 1938. In October, 1939 skirmishes between the Japanese and around 2,000 Chinese guerrillas occurred and resulted in planes dropping bombs, machine gunning’s and mortars fire. Union Jacks had been painted on the roofs of the mine buildings, and the staff and 800 men kept a low profile until the guerrillas were suppressed.

By June, 1940 the Japanese had occupied the Border zone and the military road along the Border was closed to all but Hongkong Mines vehicles. The situation was tense but quiet.

By the end of 1940, the Border situation was untenable due to increased Japanese military activities and the mine’s operation was suspended until the cessation of hostilities.

In the next and final part of this series, I will report on the war and post war development and decline of the mine.

Sources

The Hongkong Telegraph, 24 October, 1936
South China Morning Post Archive http://pqasb.pqarchiver.com/scmp/advancedsearch.html
HKRS 58-1-182-20, Public Records Office
Nielson Airfield, http://corregidor.proboards.com/thread/774/nielson-air-field
Barbara Anslow’s diary, https://gwulo.com/node/9710
http://www.filipinaslibrary.org.ph/component/content/article/35-history/47-laurie
http://www.lougopal.com/manila/?paged=23
https://www.lawphil.net/judjuris/juri1966/dec1966/gr_21601_1966.html
Report by the Senior Inspector of Mines, Perak, Federated Malay States, on the subject of The Control Measures Which the Hong Kong Government Should Adopt in Respect of Local Mining by A E P Kershaw, 1938
The Story Of Lin Ma Hang Lead Mine, 1915-1962, Trefor Williams, Geological Society of Hong Kong Newsletter Vol 9 No 4 p 3-27 (1991)
HSBC Bank Archive

This article was first posted on 28th April 2018.

Lin Ma Hang Mine Part 3 – Exploitation

Leave a Reply Cancel reply