Thirty-four inches is a rather unusual gauge, but not particularly undersized as narrow gauges go. The most common narrow gauge in the U.S. was, of course 36 inches....there were some 350 common carrier railroads built to this gauge as well as countless industrial railroads of various types. There were also a number of other gauges in use. forty-two inches, 30", and 24" were used widely and there were also "oddball" gauges such as 45", 33", and 20". In Europe and Britain gauges as small as 400mm (approximately 16 inches) were used in industrial installations. Thirty-four inches is an unusual gauge, but not unheard of.
It is likely that John Watkins chose that gauge simply because used equipment already built to that gauge was readily available. The 5 cars with 2-ton payloads would actually be a fairly light load for equipment of this size. The speed of "12 mph at full throttle" would indicate he was using a small "contractor's locomotive" of some sort. It is possible that he was using some sort of geared locomotive, but unlikely, given the mention of a "coal car"....geared engines generally had the tender incorporated into the locomotive frame rather than towing it seperately.
Small temporary installations of this kind were extremely common in mining, logging, construction, and other industrial applications. Most were cheaply and rapidly built, and only lasted a short time until the particular project they were built for was completed or the timber or mineral were worked out. The rail, locomotives and cars were often sold to another operator for re-use elsewhere rather than being scrapped on site. Southern Iron & Equipment of Atlanta GA was a large broker of used equipment, but there were plenty of others.
If you happen to track down a picture of this operation, say in an old newspaper or the local historical society, there are several on this forum who could give a lot of information, probably including the manufacturer of the equipment, the approximate age, etc.
