33 Sale of the Miike Mine

Miike Mine Under Government Management

According to tradition, the history of coal in Miike is ancient, dating back to the mid-15th century. It is said that a farmer named Denjizaemon made a bonfire on Inariyama which spread to a nearby black rock, leading to the discovery of “burning stone.” Later, in the mid-to-late Edo period, Ono Harunobu, a retainer of the Yanagawa Domain, began mining coal at Hiranoyama, while the Miike Domain opened mines at Inariyama and Ikuyama. In 1873, the new government took over ownership of those three mines. As the coal market expanded, the Miike Mine under government management began introducing Western technology, developing by leaps and bounds. Annual coal production went from 30,000 tons in 1873, growing to about 100,000 tons in 1878.

Exports of Miike Coal by Mitsui Bussan

Coal mined at Miike (Miike coal) during its time under government ownership was sold domestically for use in salt production and as fuel for steamships. Plagued by trade deficits, the government planned to export Miike coal overseas to obtain foreign currency, and to entrust the handling of the coal to Mitsui Bussan (→30), which was in the midst of preparing for its founding. In June 1876, about a month before Mitsui Bussan began business, Masuda Takashi applied to the government for permission to export Miike coal overseas, and at the recommendation of Ito Hirobumi, met with Kobayashi Hidetomo, then administrative chief at the Miike Mine. In September of that year, a “Miike Coal Sales Contract” was signed between Mitsui Bussan and the government, marking the start of Mitsui Bussan’s role as the sole agent for sales of Miike Coal. In 1884, sales to Shanghai and Hong Kong exceeded 100,000 tons, as overseas exports of Miike Coal came to represent about 60% of production.

Bidding for the Miike Mine

By 1888, the government, pursuing fiscal austerity measures, decided to sell off the Miike Mine through competitive bidding for at least four million yen. Masuda Takashi convinced Nishimura Torashiro, vice-president of Mitsui Bank, that placing the winning bid was essential to Mitsui Bussan, which had expanded its overseas network of branches alongside its exports of Miike coal. He then borrowed one million yen from the bank and placed a bid. The auction resulted in four bids: Sasaki Hachiro at 4,555,000 yen; Kawasaki Gisaburo at 4,557,200 yen; Kato Soemon at 4,275,000 yen; and Mitsui Takenosuke and Yonosuke at 4,100,000 yen.

While Mitsui was fourth in the bidding, Sasaki, the lead bidder, and Kato, with the third highest bid, were in fact proxies that Masuda had put in place to ensure Mitsui Bussan of the winning bid. If there were no other competitors, Masuda planned to have the higher bids withdraw one by one, aiming to win the auction at the lowest possible price. However, Masuda’s negotiations with the second-place bidder, Kawasaki, for his withdrawal from the bidding failed, and Mitsui Bussan (via Sasaki), ended up winning the auction by a close margin of just 2,300 yen. At the time, it was widely believed that Kawasaki was acting as a proxy for Mitsubishi (Iwasaki). Masuda later recalled that Finance Minister Matsukata Masayoshi told him, “It’s good that you managed to get Miike as well through Sasaki Hachiro. Don’t say anything, just accept the result.” Masuda agreed, replying, “I understand,” and was satisfied with winning the auction on the first bid. There is also a long-standing anecdote that has Masuda proposing to Matsukata that, “We consider our winning bid of 4,550,000 yen to include Takuma Dan, currently an engineer at the Miike Mine.” He then urged Matsukata to retain Dan Takuma even after the Miike Mine came under Mitsui’s management.

From Miike Coal Mine to Mitsui Mining

Delegated full authority by Sasaki, the winning bidder, on January 3, 1889, Mitsui-gumi received transfer of the Miike Mine, and established the Miike Coal Mine Company. They then appointed Dan to the position of general manager of Miike Coal Mine Company, serving as its chief executive officer (→Fig. 33c). Later, in 1892 the Miike Coal Mine Company became the Mitsui Mining Partnership Company, then the Mitsui Mining Unlimited Partnership the following year. In 1909 it became the Mitsui Unlimited Partnership’s Mining Department, before finally being reorganized as Mitsui Mining Co., Ltd. in 1911. Mitsui’s Miike coal mine grew to become one of Japan’s top coal producers, sometimes known as “Mitsui’s cash cow” (→34). Following World War II, mining continued even during the energy transition, but the mine was eventually shut down in 1997.

This photo was taken in January 1889 at the entrance to the Miike Mine Bureau’s office as the government-operated Miike Mine was being handed over to Mitsui-gumi. It is included in a photo collection assembled during the production of the unpublished Fifty-year History of Mitsui Mining.
In the middle row, seventh from left, is Kobayashi Hidetomo, the general manager in who led business planning at the Miike Mine Bureau. Eighth from left is Dan Takuma (→Fig. 33c), who was appointed an official at the Ministry of Public Works in 1884 and was assigned to the Miike Mine Bureau. Two years later, he became head of the Kattachi Pit while also serving as head of the Industrial Division of the Miike Mine Bureau. Dan had been investigating coal mine conditions in Europe and the U.S. since 1887, hoping to address water inflow issues at the Kattachi Pit, and heard about the decision to transfer the mine to Mitsui while he was in New York, on his way back to Japan.

In 1891, after the transfer of the mine to Mitsui, a dedicated railway was constructed connecting the Miyaura Pit and the Nanaura Pit with the shipping port in Yokosuhama.

Selected by the Kuroda family at 14 to study abroad, traveling to the United States. Studied at the Massachusetts Institute of Technology (MIT), graduating from its Department of Mining Engineering. After returning to Japan, he worked at the Osaka Technical School and as an associate professor at the University of Tokyo before joining the Ministry of Public Works. In 1889, he became general manager at the Miike Coal Mine Company. He received an exceptional salary of 150 yen per month and a bonus of 50 yen (the annual salary of the Prime Minister at the time was about 10,000 yen). At the Miike Mine, he took full advantage of his abilities as both an engineer and an executive. Later, he led Mitsui’s business as Director-General of the Mitsui Partnership Company. In 1932, he was attacked by members of Ketsumeidan, a right-wing group, ending his life at age 75 (→45).