In 1881 John Chapman and one other party owned and operated the Gold Bluff mines. Chapman and his men watched the beaches closely, and when the "gray sands" began to go out, it constituted a signal to commence operations.

Meanwhile, a placer mine had been opened at Ossagon, on the upper edge of the Klamath Gravel and adjoining the upper Gold Bluff claim. This placer was owned by the Eureka Gold Mining Co., of Ossagon Creek. When the winter rains came, the dam and sluiceway were washed away. The works were reconstructed, and a stronger dam, 250 feet long, 13 feet high, with a capacity. of 80,000,000 cubic feet of water, constructed. A ditch one-half mile in length was dug, while the pressure box had an elevation of 150 feet. The sluice was composed of 60 boxes, each 12 feet long and three feet wide. There were six blocks or ripples to the box.

During the 1880s activities at the Gold Bluffs and the Ossagon placer slumped. By 1920 mining operations at the Gold Bluffs had been closed down. It was now known that the gold deposits had never been too valuable. The gold was extremely fine, and, contrary to opinions voiced in the 19th century, nearly all had been recovered in sluiceing. Moreover, the beach sands were expensive to work, and the gold was so fine that it would float on water when dry. Every pan would show color, but it took many pans to secure a penny's worth of gold. The largest amount of gold recovered in any one year was $25,000, with one seven-day run producing $1,600. Lack of time and the thick underbrush made it impossible to locate any remains that may survive of the Ossagon Placer.

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