The Jembaicumbene Creek runs through the northern portion of Caloola, just in front of Dransfield's Mill. The middle Jembaicumbene, as this area is known, was the site of some of the earliest alluvial gold finds in the district, and Dransfield's paddock adjacent to the village reserve produced extraordinary gold finds between 1851 and 1870. Over 1,000 oz of gold were removed from this field in early 1852 alone, and as late as 1890 the Dransfield Paddock Company reported finds of 93 oz in just five days, resulting in their share price doubling in a week. All the gold mining leases on Dransfield's side of the creek were privately issued, with the condition that the rich topsoils were replaced after mining, and many diversions to the original creekbed were created across Dransfield's land to power water wheels, Californian pumps and other machinery. This culminated in 1899 with the complete diversion of the creek some 400 metres northward where the Jembaicumbene Steam Dredging Company constructed a huge three storied dredge which dug a series of over twenty deep holes during excavation of gravel for gold extraction.
Dredging in the middle Jembaicumbene ceased in 1920 and the steam equipment was moved to the Shoalhaven River, and the creek resumed flow through its altered path.
Minimal disturbance over the following nine decades has seen an extraordinary natural recovery of the ponds, flood plain, flora, fauna and birdlife, which, under the introduced willows, has burst into life with a remarkable diversity of shrubs, reeds, native lilies and flowers. The large ponds, ranging to several hundreds of metres in length and up to five metres deep, are home to black swans, native ducks, coots, water fowl, egrets and purple swamp hens. Numerous varieties of small birds have been sighted. Platypus now reside in the remains of the Steam Dredging pontoon, and a variety of fish and eels make their home in the clear mountain water. The 30 acre wetland is also home to kangaroos, black swamp wallabies, possums, native field mice, bats and numerous unusual varieties of frogs, snakes and lizards.
The entire wetland is now protected from grazing activities and is being fenced with fauna-friendly fencing. A private walking trail is under construction which will allow visitors to unobtrusively enjoy the beautiful wetland landscape and it's native inhabitants.
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