The Tustin, Calif.-based Jewelry Exchange chain just purchased a local gold mine—and it may be in the market for more.
The mine, called Gold-Stone, is located in San Bernardino County, Calif., and is made up three 20-acre parcels of land.
Owner Goldenwest, which also operates stores under the Jewelry Factory and Jewelry Source names, adds it has the option to buy two more local mines in the area.
The company began looking at mines when gold was between $1,800 and $1,900 an ounce, says CEO Bill Doddridge, who first heard about this property from a friend he played with in a rock band.
“We went in and tested all the shafts,” says Doddridge. “We were getting an average of two and a half ounces per ore sample. I figured if gold spikes high, we could make money selling it. If it goes down, you can just use it for jewelry.”
When the deed was challenged legally, it took three years of litigation to close the deal. The final price was $1.1 million.
“We plan to start production soon, but we have a lot of problems to solve,” he says. “We have a lot of issues with electricity. There is a road there, but it needs to be improved.”
He noted that there is evidence that the mine could also produce silver, platinum, and copper.
“This will further vertically intergrate us,” says Doddridge, noting the company is also in the process of acquiring De Beers sightholder EZ Diamonds.
The mine originally opened in early 1942, and miners then used donkeys and mules to move boulders. It was shut down later that year by the War Production Board after only three loads of ore were mined.
The company currently operates 16 stores, including 13 Jewelry Exchange stores, 2 Jewelry Factory stores, and 1 Jewelry Source store, as well as an online store.