Confederate Gulch is a steeply incised gulch or valley on the west-facing slopes of the Big Belt Mountains in the U.S. state of Montana. Its small stream drains westward into Canyon Ferry Lake, on the upper Missouri River near present-day Townsend, Montana. In 1864, Confederate soldiers on parole during the American Civil War made a minor gold discovery in the gulch, but the discovery of the sensationally rich Montana Bar the following year—one of the richest placer strikes per acre ever made—led to other rich gold strikes up and down the gulch, and touched off a frantic boom period of placer gold mining in the area that extended through 1869. From 1866 to 1869, the gulch equaled or outstripped all other mining camps in the Montana Territory in gold production, producing an estimated $19–30 million worth of gold (in late 1860s dollars). For a time, Confederate Gulch was the largest community in Montana. In 1866, Montana had a total population of 28,000, and of these, about 10,000 (35%) were working in Confederate Gulch.Diamond City grew to a claimed size of ten thousand
The main boomtown serving the miners at Confederate Gulch was Diamond City (). During its heyday, Diamond City was the county seat of Montana's Meagher County, though today the area is part of Broadwater County. While gold production was at its height, Diamond City roared along both night and day. In their frantic efforts to get at more gold, the miners built ditches and flumes that extended for miles, and employed high pressure hydraulic mining methods which washed down whole hillsides and ate up the gulch floor. The hydraulic mining process left huge spoil banks in the gulch and eventually consumed the original site of Diamond City, which had to be moved to a new location.
By 1870, the gold supply at Confederate Gulch had been exhausted, the boom was over and the residents of Diamond City simply picked up and left. In 1870, there were only 255 people remaining, and a year later only about 60. Today hardly a trace remains of Diamond City or the other gulch communities. An unimproved road still winds up the gulch from the Missouri River valley and crosses the top of the Big Belts on its way down to the Smith River valley. Confederate Gulch, Diamond City and the Montana Bar remain spectacular examples of Montana's mining history, particularly the flash-in-the-pan placer gold mining camps common in Montana in the latter half of the 19th century.
Geology Confederate Gulch is considered its own unique mining district. The district includes the length of the gulch along with the upper tributaries of Boulder Creek, Montana Gulch, and Cement Gulch.Lyden, Charles J., 1948 The Gold Placers of Montana. Memoir No. 26. Montana Bureau of Mines and Geology, Butte, Montana, cited in Montana Department of Environmental Quality Report on Confederate Gulch Mining District
The principal rocks underlying the placer gold deposits of the Confederate Gulch district are the shales of the Spokane and Greyson formations, as well as limestones of the Newland formation. These are cut by diorite and quartz diorite dikes, stocks, and sills. Narrow quartz veins, found along fractures in the diorite and along bedding planes in the shale, contain most of the high-grade gold ore. Ore values decrease with depth, and few mines have been developed deeper than . In addition to the quartz veins in the shales, the diorite contains "low grade mineralized shear zones".Sahinen, Uuno Mathias, 1935 Mining Districts of Montana. Unpublished Master's thesis, Department of Geology, Montana School of Mines, Butte; Pardee, Joseph Thomas and F. C. Schrader, 1933 "Metalliferous Deposits of the Greater Helena Mining Region, Montana", U. S. Geological Survey Bulletin #842, reprint of article in Mining Truth, Vol. 14, No. 10; Reed, Glenn C., 1951 Mines and Mineral Deposits (Except Fuels), Broadwater County, Mont. Information Circular 7592. United States Department of the Interior, Bureau of Mines), cited by Montana Department of Environmental Quality Report on Confederate Gulch .
These Spokane, Greyson and Newland formations have been uniformly considered to be in the Middle Proterozoic Belt Supergroup. In this classification, these formations would be much older than the overlying Flathead sandstone from the Middle Cambrian Period, and the division between the older Proterozoic rocks and the newer Cambrian rocks was considered to be a significant disconformity. New field work in the Big Belt Mountains suggests that some rocks mapped as the Spokane Formation are conformable with overlying Middle Cambrian strata, and are not part of the Middle Proterozoic Belt Supergroup but are part of strata that may be younger Late Neoproterozoic.DETRITAL ZIRCON EVIDENCE REQUIRES REVISION OF BELT STRATIGRAPHY IN SOUTHWESTERN MONTANA, BALGORD, Elizabeth, MAHONEY, J. Brian, Department of Geology, GINGRAS, Murray K., 2009 Portland GSA Annual Meeting (18–21 October 2009), Paper No. 232-1
The rich placer gravels of the drainages were deposited during the interglacial stages of the Pleistocene epoch.Montana Department of Environmental Quality Report on Confederate Gulch Mining District citing Pardee, Joseph Thomas and F. C. Schrader, 1933 "Metalliferous Deposits of the Greater Helena Mining Region, Montana", U. S. Geological Survey Bulletin #842, reprint of article in Mining Truth, Vol. 14, No. 10, and Reed, Glenn C. 1951 Mines and Mineral Deposits (Except Fuels), Broadwater County, Mont. Information Circular 7592. United States Department of the Interior, Bureau of Mines. Confirmation of concentration of the placer gold deposits in relatively recent times is indicated by the bones of mastodons and elephants that were dug out of the gravels. The distribution of the placer gold concentrations suggests that the common source of most of the placer gold in Confederate Gulch and White Creek was a series of quartz lodes on Miller Mountain on the divide between the two drainages. These gold-bearing quartz lodes were consumed by the erosion that produced the placer gold deposits in Confederate and White Gulch.
Initial gold discovery In 1864 and 1865, before the end of the American Civil War, Confederate soldiers arrived in the Montana Territory to prospect for gold. Many of the soldiers had been part of General Sterling Price's Confederate army, which had invaded Missouri from Arkansas in the fall of 1864. The campaign disintegrated after several critical defeats by Union forces.The Gold Frontier, Dan Cushman, Stay Away Joe Publishers, 1973, pp. 172–179. However, the remnants of the defeated army remained in quasi-official units of a couple of hundred to a thousand or so.
Pursuing these scattered units was costly, time-consuming, and dangerous business. After pondering the situation, the Union commander in the area, General Alfred Pleasonton, instituted a policy of amnesty, offering parole to the Confederates captured during the 1864 campaign if they would leave the combat area and travel up the Missouri River into the west. Pleasanton hoped that his policy for prisoners of war would also convince the remaining free-roving units to disband and prevent them from becoming partisan bushwhackers living off the land like Quantrill's Raiders and the James boys.
Fighting and perhaps dying for what many viewed as the lost cause of the Confederacy was discouraging. The offered parole seemed the better choice. Additional motivation came from rumors of rich new gold discoveries in the Montana Territory. Whether due to Pleasanton's policy or in spite of it, in 1864 and 1865 these ragtag Confederate units faded away, and a tough breed of Missourians began to show up in the Montana Territory.
In 1864, two Confederate prisoners, Wash (Washington) Barker and Pomp Dennis, were paroled and released at Liberty, Missouri to the owner of a steamboat bound up the Missouri River for the Montana goldfields. Steamboats had to make frequent refueling stops for wood to heat the boilers, but from Yankton, Dakota Territory to Fort Benton, Montana Territory (a distance of well over 1,000 river miles), hostile Indians controlled most of the country. The Indians had burned the few existing wood yards and steamboats had to stop and cut wood as they went. Rebel soldiers like Barker and Dennis could work their way to the Montana Territory by chopping fuel along the way.
The Missouri River was low in 1864, and Barker and Dennis only made it as far as Cow Island before low water forced the steamboat to unload passengers and freight. The freight and paying passengers were carted by team and wagon the rest of the way to Fort Benton, but the former Confederates were on their own. News had come down the river that a new gold strike had been made at Last Chance Gulch (present-day Helena, Montana), at the foot of Mullan Pass, but by the time Barker and Dennis walked there from Cow Island, the good ground was taken, no jobs were to be had, and the cost of living was high.
Smoke from prospectors' camps could be seen all along the foothills and so Barker and Dennis set out up the Missouri from Last Chance Gulch, prospecting here and there, living off the country. Here the Missouri was a large mountain river, cold and clear, bordered on each side by high ranges, with vast alluvial fans running out from steep gulches down to the river. Good color could be found in these gravels, but so far there were no rich strikes.
While prospecting and living off the country, Barker and Dennis were joined by Jack Thompson and John Wells, who had also been rebel soldiers. They eventually wandered into a gulch on the west side of the Big Belt Mountains.Roadside History of Montana, Don Spritzer, Montana Press Publishing Company, Missoula, Montana, 1999, , p. 252. Late fall was at hand, and they determined to stay for the winter; there was a good creek and plenty of wild game. At one place near the mouth of the gulch, east of the creek, Thompson sunk a hole and found the first pay dirt, a piece of gold about the size of a grain of wheat. Prospecting up the canyon they found more gold in small quantities. Eventually they established a modest discovery of placer gold in gravels of the little creek, where a day's hard work could produce enough to pay for a few pounds of beans.
Naming Confederate Gulch and Diamond City The initial strike of Barker, Dennis and Thompson on the gulch in the Big Belt Mountains was small, but hard work produced enough gold so that word spread. Other Southern sympathizers showed up in late 1864, and the area became known as Confederate Gulch.
During the winter of 1864–1865, four log cabins were built equidistant around a large rock obstruction on the narrow floor of the gulch. The paths from cabin to cabin made a perfect diamond in the snow as seen from the slopes above, and so the cabins in the gulch were named Diamond City. The "city" part of the name was a joke, comparing this poor settlement of Southern sympathizers to the booming mining camps of Helena and Virginia City.
Discovery of the Montana Bar Diamond City and the associated prospecting camp grew slowly. In the winter/spring of 1865, many prospectors passed through Confederate Gulch, since it was on one of the few trails that led from the Missouri Valley up over the Big Belt Mountains to the Smith River Valley, where game was abundant and there was available land that could be farmed.