Ouray Colorado Vacation Guide and Trip Planning Information for SW Colorado

Ouray County History: Treasury Tunnel on Red Mountain Pass

Posted by Guest Blogger on Tue, Apr 26, 2011 @10:49 AM

As you travel highway 550 between Ironton and the summit of Red Mountain Pass along the Million Dollar Highway, you encounter three famous mining tunnels. Two of these, the Meldrum Tunnel and the Joker Tunnel, will be  discussed in future articles. However, the most famous of the three tunnels was the Treasury Tunnel. It is located near the top of Red Mountain Pass and today it is part of the Idarado Mine complex of more than 100 miles of tunnels between Red Mountain Pass and Telluride. The entrance to the Treasury Tunnel is behind the large metal door against the hillside across the highway from the Mining Overlook near the summit of Red Mountain Pass.

W. J. Hammond, Jr. founded the Treasury Tunnel Mining and Reduction Company in 1896. To create the Treasury Tunnel Mine, Hammond consolidated a number of his mining claims, including the Stumper and Old Ozzie. The tunnel was originally called the Hammond Tunnel and is located on the Stumper claim.  Soon after the tunnel was started, the Silverton Railroad built a 2000-foot spur track from the Yankee Girl sidings to the Treasury Tunnel. The Treasury Tunnel branch had an unusual switchback at the bottom of the canyon that was built over a branch of Red Mountain Creek followed by a second crossing of the creek before ending at the Treasury Tunnel Mill.

treasury tunnel 1905Hammond hoped the treasury Tunnel would allow him to tap the gold deposits that were known to exist between Red Mountain and Telluride. By 1900 it had been driven over 2000 feet toward Telluride.  In 1901 the prominent mining engineer Frederick Ransome said the following of the Treasury Tunnel project: “Without expressing an opinion on this particular enterprise, it may be pointed out that, in so far as the projectors of long tunnels count upon finding richer or more abundant ore than is indicated near the surface, they are playing a game of chance in which the probabilities are decidedly against them.” However, the mine operated with some profits for about ten years and then shut down when Mr. Hammond left the area to return to Pittsburg. The photo shows the mine soon in 1905.  (Photo courtesy of Ouray County Historical Society)

In the mid 1920’s the Million Dollar Highway was upgraded for automobile traffic and moved to the west side of Red Mountain Creek. This put the Treasury Tunnel on the main road for the first time. In 1930 Ralph Kullerstrand and Joe Condotti bought the old Treasury Tunnel. They reconditioned the mill with some machinery obtained from the Mountain Top Mill in Governor Basin and built a tramway from the YankeeGirl dump uphill to the Treasury Tunnel Mill. However, wood and metal in the dump required digging by hand, and this doomed the project from the beginning. Once again the Treasury Tunnel and its mill stood silent.  

In the mid 1930’s the San Juan Metals Company bought the Treasury Tunnel from Kullerstrand and Condotti who used the proceeds from the sale to build a ski lodge in Ironton Park. In 1937 a new modern mill was built and in 1939 Newmont Mining took over the Treasury Tunnel and formed the Idarado Mining Company to operate the mine.  They consolidated many of the old mines including the Barstow, Black Bear, Virginius and the Tom Boy.

During World War II the tunnel was extended to over 8000 feet and large quantities of lead and zinc were mined for the war effort. The old Meldrum Tunnel was extended on the Telluride side of the mountain and, until recently, it was possible to enter the Treasury Tunnel and come out in Pandora near Telluride. The two tunnels were more than 500 feet different in elevation so a shaft connected the two tunnels.  As the mine expanded so did the tailings ponds to the north. The Idarado Mine purchased part of the Ironton Town site, and the large tailings pile along the start of the Corkscrew Pass road began to grow with 800 tons of ore processed per day. The slurry pipe bridge across Corkscrew Gulch, still intact today, was once the longest suspension bridge in Colorado.

In 1956 the Treasury Tunnel Mill was shut down and all milling operations moved to the Telluride side of the mountain at Pandora. The so-called “graymill” at Pandora still stands today. For many years the Idarado Mine led Colorado in the production of lead, zinc, copper, gold and silver. The Idarado Mine ceased operations in 1978 and in the 1990’s a massive reclamation project routed water drainage around the mine dumps and covered the tailings piles with rock and dirt followed by revegetation. Between 2001 and 2005 more than 3000 acres of Idarado property on Red Mountain Pass was purchased by the Red Mountain Project and returned to Forest Service control.

About the Author:  Don Paulson is the curator at the Ouray County Historical Society and Ouray County Museum.  He is also a retired Professor of Chemistry where he specialized in organic chemistry.  Don is an active member of the Ridgway Railroad Museum, and an avid hiker, 4WD (jeep) enthusiast, and photographer in addition to his duties as curator for the museum.


Tags: history of ouray colorado, ouray museum, ironton, million dollar highway