The mine was located opposite Richard's Ferry on the Bannockburn side of the kawarau River, approx 200m west of the Bannockburn bridge (location #155 - McAndrew Bridge) and approx 150m west of the current bridge.

In April 1869 James Nicholas discovered and opened a seam of lignite opposite Richard's Ferry on the Bannockburn side of the Kawarau River. He gave the mine the name of the Gladstone Coal Works.

In January, James Nicholas opened up a pit in Adams Gully

On 14 April 1870, Mr Nicholas purchased the Cromwell pit by auction from Owen Owens for £710. This pit was in front of Stuarts Hotel in Melmore Terrace. When his Bannockburn mines proved more promising, Mr Nicholas closed down the Cromwell pit and moved the pumping machinery to the Adams Gully mine. He then tried unsuccessfully to sell the Cromwell pit. Finally the lease elapsed.

In April of 1871, James Nicholas, together with John Jenkins and J L Edwards took up a new lease of 20 acres covering all the coal area of the old Cromwell pit. The intention was to eliminate any competition to his Bannockburn mines. At this time James Nicholas advertised that his Gladstone Coal Works had mines at Kawarau Ferry and Adams Gully. The name Gladstone Coal Works was given to both mones.

In August, Mr Nicholas leased his Kawarau Ferry mine to Mr Alley and Mr Goodwin (names unknown). This gave Mr Nicholas time to concentrate on developing his Adam's Gully mine.