In the summer of ’04, Shorty Harris’ discovery gave rise to a true gold stampede. He named it Bullfrog because the hunk of ore that he held in his hand was dark green in color and he thought it looked a little bit like a bullfrog.
Locals believed that a great future lay ahead for the district as stone and brick buildings quickly replaced tent houses and wooden stores. Prices for building lots and mining claims soared even before extent of the ore bodies had been determined by government geologists.
J.P. Loftus, a graduate of Amherst
, arrived in Rhyolite
to do some investing for a friend who wanted to own a gold mine.
His astounding over-night success as a mine speculator and stock manipulator might have raised a few eye brows if it hadn’t been that everyone else enjoyed the same success.
A gold mine a few miles north of Rhyolite showed good test results and became the Bullfrog Gold Bar Mining Company owned by Loftus and his new partner James R. Davis. The enterprise received wide acclaim causing share prices in the company to climb.
Equipment soon arrived at the site and within a few months ore was being lifted out of three shafts. A few pockets within the mineral belt produced ore as high as $1,500 to the ton, but the average ran below one-hundred dollars. In order to be profitable, a mill had to be constructed on site.
Orders were placed for ten milling stamps and the necessary attachments for collecting gold. By early months of 1908, the mill was up but only marginally operational. The partners gave the press glowing reports and share prices in the company hit new highs. Loftus stated that there was enough ore blocked-out below ground to keep the mill running full time for years.
The industrialist Charles M. Schwab took an option to acquire the property for a reported one million dollars. Schwab extended the option a number of time before deciding to drop the deal. He claimed that the San Francisco
earthquake put a damper on his enthusiasm.
Less than six months from the beginning of operations the mine and mill were sitting idle awaiting construction of a new pipeline. At the same time, a local newspaper reported that 200,000 shares of the companies stock had been sold by a bank in the mid-west. The dumping of that many shares caused share-price to sharply decline.
Undisturbed by unfolding events, the two partners left the district for a two month tour of Europe
Loftus stated that they would look into matters when they returned. A current of suspicion ran through the camp that the shares dumped on the market belonged to Loftus and Davis.
While the partners toured Europe
, their attorney representing, the Nevada Exploration Company, placed the Bullfrog Gold Bar Mining Company into bankruptcy proceedings over a loan that was made to help finance the mill.
Interestingly, the sole owners of
Nevada Exploration Co were non-other than Loftus and Davis.
In effect the partners brought suit against themselves which under Nevada
law was perfectly legal.
“Fraud of the Worst Kind”, cried the Rhyolite Herald as the bankruptcy court passed ownership of the Gold Bar Mine to Loftus and Davis. The court awarded nothing to those still holding shares in the Bullfrog Gold Bar Mining Company.
The partners returned from their European trip sole owners of the mine and the mill.
As full owners, a new company was formed that offered stock at a discount to those who had lost their money in the Bullfrog Gold Bar Mining Company.
The full story unspooled in local newspapers giving details that were uncovered from company records and findings in court documents. Threatening Letters soon appeared in the papers from the dispossessed a few recommended a hanging.
Facing public outrage, the partners quietly discontinued attempts to sell stock in the new company and each took early retirement.
Loftus, in later years, from his home in Santa Barbara
, claimed that it was the responsibility of those who invest in mining stock to look to their own interest. He had no regrets.
In 1907, the federal government issued its report on mines within the Bullfrog district. In summery, the report stated: “It is evident that the prosperity of the camp must depend on the successful working of ore much inferior in grade [to that found in Goldfield]”. Wow.
The report supported what many mine owners already knew. Decline in production and the high cost of recovery spelled the end.
By 1910 the population of the Bullfrog District had dropped from a high of 10,000 to less than 500.
The ghost town of Rhyolite has received preservation support from BLM, Friends of Rhyolite,
Beatty Historical Society, Nye County
The effort of government agencies and private organizations has made it possible for the public to enjoy visiting the site
The scenic ghost town of Rhyolite is locate about 4 miles west of Beatty, Nevada
on Highway 374.
Well worth a visit.