OIL OR COAL.

Dominion, Volume 6, Issue 1844, 2 September 1913, Page 3

OIL OR COAL.

MR. CHURCHILL'S NAVY ERA. • BIG POLICY SPEECH. ADMIRALTY IN THE OIL BUSINESS The opening of a new era in tha history of tho Navy was announced in tho Houso of Commons on July 18 by Mr. Churchill. Though coal , will for years remain tho basis of British sea power, oil fuel has become bo important for the Navy that the Admiralty - proposes to sot up in business for itself in oil. Oil was tho main themo of. Mr. Churchill's speech on.Voto S of the Navy Estimates. He announced:— The immediate policy of tho Government is to obtain oil by contracts for five years. , ! One contract is to be placed with the Mexican Eagle Co., of which Lord Cowdray is head and with which Lord Murray (ox-Chief Liberal Whip) is connected. The ultimate policy is for tho Admiralty to become "the independent ownor and producer of its owu supplies of liquid fuel." No addition to the naval programme in consequence of tho Canadian situation. Acceleration of shipbuilding will temporarily fill tho Rap and maintain our position "in tho absence of AustroHungarian and Italian construction." Our present unprecedented naval output will give us: New destroyer onco a week.. Light cruiser every month. _ Super-Dreadnought every 45 days. Full crews will bo available. Two rigid airships are projected as well as six non-rigid airships. More "sea-planes" have been ordered.

' Mr. Churchill's Speech. "Oil fuel is the subject which holds tho first placo in the affection of the public," said Mr. Churchill, and accordingly lie devoted "a full hour to a complete review of the position. Ho set out the advantages of oil fuel over coal: Radius of "action increased by nearly 40 per cent. ' ! Vessels have greater fuel storage capacity. Fuel supplies taken on board more rapidly and with less exhaustion of the crew. . Warships can bo produced at loss cost. . ' Oil gives very high speed. Wo now have "more 100" destroyers built and building r dependent entirely on oil fuel, Mr. Churchill said. Tho experiment of building a division of fast battleships and battle-cruisers and a number of light cruisors burning oil fuel oniy had proved successful. "Tho fast battleship armed with 15in. guns seems likely to bo imitated, though at a very considerable distance, by our competitors, and there is no reason to doubt ■,that we have,'successfully maintained that superiority in construction which can be traced throughout, the whole naval history of tho last twomty-fivo ypars. None of theso vessels could liavo been satisfactorily constructed on a coal-burning basis." ' ' Why, then, wero the five battleships this .year t-o be coal-burning, with oil as auxiliary fuel only? "Onl is only required in large snips wlieii aji exceptional speed has to be reached wjtli a ( vessel of exceptional quality. Ordinary 'speed can be effectively realised with coal as the main motive power. Coal will ■continue to bo tho main. basis of our sea power in lino of battle at present." Price Problem. . Criticism of the difficulty .of getting oil supplies into tho country in timo of war was dismissed din a sentence: "If wo cannot get oil wo cannot got oorn, cotton, or tiiic thousand and one commodities necessary for tho economic energies of Britain." There was, his naval advisers declared, no sorious danger to our oil supply so long as wo kept the command of, the sea. "Thoro is plenty of oil'in the world." Tho ammial output was 50,000,000 tons, and at tho outside our Navy would require no moro tilian 200,000 tons; "and we aro drawing, or soon shall ho able to draw, supplies from California, Persia, Texas, Rumania,' Borneo, Egypt, Mexico, and Trinidad."

At Homo we have "great potentialities," for it is calculated that the Scottish shale deposits would if devel-. oped givo between 400,000 and 500,000 tons a year for 150 years." "At a price,", he added • significantly in reply to an observation across tho table. "Tho problem is not ono of quantity, tho problem is ono of price," ho proceeded. Oil had doubled in cost. So far' tho system of purchase had been satisfactory—"so far, but no further," he added dramatically'. Admiralty as Producers. Hitherto wo had bought "in, what might by a stretch of tho imagination be called tho open markot,". but "the open market has become ail open mockery." The epigram brought laughter. Mr. Churchill, :howover,' proceeded gravely. ' • "Our stake in oil ships has becomo so important that we must have the certainty of being able to 'buy a steady supply at a steady price." To meet this situation a two-fold policy had been prepared: An ultimate and an interim i°y"Tho ultimate policy is that tho Admiralty should becomo tho independent owner and producer of its own supplies of liquid fuel— ■ "(1) By building up an oil reservo sufficient to mako us safe in war and ablo to' overreach prico fluctuations in timo ofi peaco. .

"(2) By acquiring the power to . deal in crude oil as it comes cheaply to market, distillyrig it ourselves. "(3) We must bo the owners or tho controllers at tho sourco of a proportion of the natural oil wo require." Tho interim policy embodied forward contract fivo years' ahead. Oil being munitions of. war theso oontracts were confidential, but, said Mr. Churchill, ho would never raiso tho plea of secrecy to shirk any point oil which prejudice might bo raised or from which political capital bo sought. ; "And so," ho went on,' "I mention ono firm —and ono firm only—because it is one which has beeni the subject of many insinuations. Tho Admiralty consider it indisponsablo to a proper solution of tho question of oil supply to make a contract for a portion —a comparatively small proportion, but a sul)stimtial proportion—of our oil supply with the Mexican Eaglo Company. Tnig is tho company directed by Lord Cowdray, with wihioh Lord Murray is connected." The confession, boldly avowed, raised a whirl of derisive laughter. , "It is also," Mr. Churchill continued serenely, "the greatest British oil company iu tho world, and it is one of the comparatively few great British oil comI paniies in fclio world.

"It is no part of my duty," Mr. Churchill continued, reading 'rapidly from Iris pile of manuscript, "to go into •sudli matters, but I have been assured by .tin.] Cliief Whip that no funds of tlis Liberal party have ever been invested ill this company—(Loud laughter and chccrs) —and I learn on authority t'hat Lord Murray himself Iras got no shares in it. Even if there wcro twenty Lord Murrays, and every one of them had got 20,000 shares, and if all the funds, past, -present, and prospective, of tilio Liberal party were exclusively invested' in this company, we oannot see in what way those facts would be relevant to the decision the Admiralty has taken." (Ministerial cheers.) The storage, transport, and distribution of oil to tho Fleet had not beeoi negleoted. Built and' building, we had 13 transport steamers; fivo of the largest

alone could bring mora oil. than tho 'whole Navy consumed 1 last year. "No Personal Interest." Asking tho llouso to endorse tho discretion ary jxwer of tho Admiralty to make theso oil contracts, Mr. Churchill created mingled surprise and amusement by reading tho following declaration'from the members of tho Board •of Admiralty. Ministerialists and Unionists laughod loud and free as Mr. Gburdhill iread 1 : "Wo liavo not and wo have never had any personal interest, direct or iridireot, in.tlio supply of oil fuel. Wo do not bold and wo have never hold during our tenure of office any oil shares of any sort. Wo occupy a ■position of complete disinterestedness and impartiality ill regard to all oil enterprises,' oil companies, oil magnates, and oil combinations." "Is that signed by tho Government?" asked Mr. George Terrell with emphasis, encountering fierce cries from 'tho,'Ministerialists 'and a domand to "Stand' up." Mr. Churchill mocked the critics who headed tho Navy from this company becauso it was foreign and from that firm becauso they were Liberals, and said that if tho Admiralty were ham- • pored in this way they could not guarantee tho future of tho oil supply. To Major Archor-Sheo or "anyone else who has charges or insinuations to mako" Mr. Churchill extended this challenge: "Here is tho place, now is tho time. Tho place is privileged, the time is extremely convenient. If anyono has a charge to make against any member of the Board of the Admiralty or official let him seize this golden opportunity. But if there is nothing but spiteful " . . Loud cries of 'Oh! Oh!" and a v&icd shouting "Rotten!" caused Mr. Churchill to pause, and he suggested to a member of tho Opposition that perhaps he had not lealised "tho subterranean 1 snarling" that had taken place.. ) "If there is nothing but spiteful and untruthful chattering and vapouring, then I invito tho House to join with tho Admiralty in treating these manifestations with the contempt tlicy deserve." (Ministerial cheers.)