MINES STATEMENT

Hokitika Guardian, 7 September 1920, Page 1

MINES STATEMENT

(By the Bight Honourable W. F Massey, Minister of Mines).

Mr Speaker,—ln presenting my first annual statement on the mining industry of the Dominion it may at the outset be observed that such industry shows signe of revival. During the year inquiries have been received from many parts of the world for information bearing on our mineral resources, and every effort is being made by the staff of the Department to furnish those interested with full particulars. Early this year the Head Office of the Department was .reorganised so as to more closely co-ordinate the activities of the several sections, and -honourable members will be pleased to learn that the results already obtained have fully justified the changes made.

In conformity with the announcement made by my predecessor in last year s Statement, the Inspecting Engineer of Metalliferous Mines was instructed to visit the United States of America, and for that purpose lie left this Dominion on the 24th November, 1920, and after spending about six months in inspecting the prominent mines in California, Colorado, Okla.hama, and other important mining districts, returned to New Zealand on the 23rd May last. From the valuable experience gained by that officer the mining community in the Dominion should benefit. STATE ASSISTANCE..

As an aid towards the development of the mining industry the Government has recently authorised the rates hitherto paid for prospecting being increased by 30 per cent. This should encourage miners to continue and increase their efforts to locate and eventually win minerals. The terms and conditions subject to which prospecting-drills are hired have also recently been amended, and the ’ Government now loans the • drills free of rent, and in addition the services of an experienced drill superintendent, whose salary and expenses are paid by the Government, are provided. Subsidies up to £IO,OOO, on a pound-for-pound basis, may also be paid for prospecting deep levels for gold-quartz lodes down to a. depth of not less than I,oooft, or such less depth as the Minister of Mines may approve. Any person engaged in prospecting or pioneer mining may be paid a subsidy of not exceeding 5s for every £1 expended, by such person in prospecting or pionoei mining during the preceding twelve months. Any local body in a mining district may expend a- portion ,of the revenues received by it from duty or goldfields revenue in prospecting f6i diamonds, gold, silver, tin, or other meals, but I am sorry to say local bodies rarely grant any monetary assistance.

Advances by way of loan of a sum not exceeding £20,000 may also be made by the Government to any company or person for carrying on mining operations, purchasing mining machinery, and for carrying on coal-mining, including the purchase of plant, and the construction of roads and railway lines, thereto. In order to encourage the production of quicksilver the Government recently revived the offer of a bonus of 4d per pound for the first | 100,0001 b of marketable retorted quicksilver free from impurities produced from any mime in New Zealand, tit is hoped that with this assistance those engaged in mining for quicksilver will he able to produce a sufficient quantity! of quicksilver to entitle them to payment of the bonus offered. In addition to granting assistance in the, above directions, applications for remission or reduction in rentals have been granted in all cases where, upon inquiry, it was found advisable in the public interest to grant such relief. Legislation will also he introduced this session reviving the bonus provisions of the Iron and Steel Industries Act, 1914. In addition to this, arrangements are being made to obtain 20 tons of ironsand from Taranaki and 20 tons of iron-ore from Parapara for the purpose of shipping the same to England, where a test will be made.under a new process to determine whether'or not it is, possible to produce iron on a commercial scale in New Zealand. This test will be made under the oversight of one of the recognised iron and steel experts in England, who will be required in due course to report upon the results to the Government. Since the 19th September, 1919, the Government has been negotiating, through the High Commissioner, with the British Admiralty for the.purpose of entering into an arrangement with the British Government in connection with the boring and development of mineral oil and oilier products in New Zealand, but up to the present time no agreement has been entered into. I have deemed it necessary to; briefly: refer to these matters, because it does not: appear to be generally known .what may he and is being done for the encouragement of mining in the Dominion. ) Honourable members will regret to learn that, owing to the scarcity of labour, to increased wages, and to the higher prices demanded for all plant and stores used in mining, there has been a decrease in the production of metals during the year 1919. .MINERAL PRODUCTION. The following table shows the quantity and value of gold, silver, and other minerals, coal, and kauri-gum exported during the year 1919, also the quantity of native coal consumed in tli© Dominion for the same period:— Gold, 31st December, 1919—Quantity 320,2100 z, value £1,334,405. Silver, 31st December, 1919.—Quantity 453,567 oz., value'£lo3,o37. Quicksilver, 31st December, 1919. Quantity 8 3-5 tons, value-£4,619. Tungsten-ore, 31st December, 1919Quantity 131 tons, value £29,489. Mixed Minerals, 31st December, 1919 Quantity 1,091 tons, value £4,051. New Zealand coal exported, 31st December, 1919. —Quantity 138,174 tons, value £201,383.

New Zealand coal used in New Zealand, 31st December, 1919. —Quantity 1,709,674 tuns, value £2,491,780. Kauri-gum, 31st December,' 1919. Quantity 4,128 tons, value £255,812. Coke, 31st December, 19i9.—Quantity 45 tons, value £ll3. Total value for 1919, £4,424,689. This increase is largely due to the fact that 157,623 oz of gold entered for export in 1918 was not exported till 1919. AURIFEROUS-QUARTZ MINING. Tlie value of bullion, obtained from quartz-mines during 1919 amounted to £573,662, obtained from treating 286,057 tons. Dividends paid amounted to £118,831. The following table shows the production from the most important mines: Wailii Gold-mining Company (Limited) —Quartz treated 160,511 tons; value of bullion £303,586; Dividends paid, 1919, £99,181, total to end of 1919 £5,338,057.

Wailii Grand Junction gold-mining Company—Quartz treated 55,442 Lons; jvaljue of bullion £97,899; Dividends paid nil, total t oend of 1919 £267,664.

Talisman Consolidated gold-mining Company—Quartz treated 3,655 tons; vn|lu;e of Ibullion £46,598; Dividends paid, 1919 £17,250, total to end ’of 1919 £1,150,972.

Muir’s gold reefs—quartz treated Dividends paid, ETAOINSHRDLUCM 4,1C0 tons; value of bullion £17,703,

Blackwater Mines (limited)—Quartz treated £24,969; value of bullion £46,136; Divdends paid nil, total to end of 1919 £174,994. New Big River gold-mining company —Quartz treated 4,25.4 tons; value of bullion £13,198; Dividends paid, 1919, £2,400, total to end of 1919 £103,21)0Progress mines of New Zealand (limited.—Quartz treated 1.5,980 tons; value of bullion £20,748; Dividends paid nil, total to end of 1919 £326,562.

Murray Crook gold-mining Company —Quartz treated 4,512 tons; value of bullion £9,975.

All other quartz-mines—Quartz treated 12,634 tons; value of bullion £18,178; Dividends paid, nil, total to end of 1919 £21,727. */... Totals—Quartz treated 286,057; value of bullion £574,021; Dividends paid. 1919 £118,831, total to end 1919 £7,382,576. ALLUVIAL AND DREDGE MINING. The value of the .production from alluvial claims amounted to £80,273, as compared with £78,895' for 1918, an increase of £1,378. There is a prospect of there being a (further increase m production from alluvial mines in 1920, as one or two claims upon which a considerable capital has been expended in development arc now commencing production. The dredging industry again shows a decline in production for the. year, the value of bullion won for 1919 being £47,838 as compared with £63,691 for 1918; but it is interesting to record that an American company is now building a larger and more powerful dredge near Hokitika tlian has ever been seen in New Zealand "before, and if this company is successful it may mean a revival to some degree of dredge mining in other .parts of the Dominion.

PETROLEUMUnfortunately .petroleum has not yet been '.form din payable quantity in New Zealand, though several companies have carried on .boring-work during the year. The Government has now under consideration a proposal .for the development of our oil resources with the object of definitely proving whether they are of commercial value. The sum of £4,450 was paid in subsidies to oil boring companies during the year. KAURI-GUM.

The production of kauri-gum for 1919, was 4,128 tons, valued at £255,812, as compared with 2,419 tons, valued at, £157,313, for ,1918. It is worthy •of note that a company, (Parenga Kauri Oils, Limited) having a. capital of £200,000 has .been formed to, carry on the .work of .producing oil. and rtiirn from the large deposits of kauri peat. It is stated that the company, has 6,500,000 cubic yards qf peat on As, properties, and that this will yield £- worth of fine gum per yard. ,It is therefore probable that there will .be a large production from the swamps and peatdeposits•.hitherto not regarded as valuable.

CINNABAR. Tlie mining of cinnabar and production of quicksilver therefrom lias been carried on by one company during the year, and 11,1751 b. quicksilver was. produced, .worth £2,794. , PERSONS ENGAGED IN MINING. Tlie following table shows the number of miners in each inspection district and the branch of mining in which they, were, engaged: Classification: gold, silver and .tungsten ore; Inspection District: .Northern 1,153; West Coast 589; Southern 443., Decrease 581. . 1 Classification: Coal. Inspection Dis-, trict: Northern ~939; West .Coast 1391; -Southern 1,114. .Decrease 60. Classification: Cinnabar and asbestos; Inspection District: Northern 44; \\esb f Coast. 2. . , Total's— l lnspcctipii District: Northern 2,106; West ..Coast .2,482; .Soutiern 1,557; • Decrease 431 The scarcity of coal-miners is severely felt on all the Possibly with the recent considerable increase in watres some coal miners who have given up°that occupation, also some gold-min-ers, may go into the coal-pits. It tins does not occur, the carcity of coal will continue for at present there are quite a thousand coalminers too few to efficiently man our existing collieries and to supply our requirements. COAL MINING. The output of coal during 1919 am minted to 1,847,848 tons,' as compared with .2,034,250 tons -during 1918, being n decrease of 186,402 tons. On the West Coast 845,826 tons were produced, a 1 decrease of 151,263 tons. The decrease in .the coal-production was due to organised restriction of work by miners on the Grey, Buller, and Waikato coalfields. By such policy the output per person employed below ground declined from 703 tons during

1918 to 648 tons during 1919; and a coal-famine was produced by which railway traffic was seriously curtailed, indus tries brought almost to a standstill, in addition to which severe hardship was suffered by many aged and infirm persons during an unusually severe winter.

The quantity of coal imported into the Dominion was 391,434 tons, as against 155,332 tons duding 1918 and 518.070 tons during 1914. MINING AND QUARRY ACCIDENTS The deaths from accidents at coalmines numbered ten, being 2.53 per thousand persons employed, or 5.41 per million tons of coal produced, which was slightly greater than during the previous year. For comparison it may be stated that the fatal accident rate per million tons of coal produced in the United Kingdom for 1918 (the latest year for which" statistics are available) was 5.86, which is 0.45 higher than in this Dominion during 1919. I have pleasure in stating, however, that since November last to this date there has not been any fatal colliery accident.

The number of lives lost at metalliferous mines during 1919 was four, the proportion of deaths per thousand persons employed being 1.82 and of these three were lost by the capsizing of a boat being used in connection with the dismantling of a. dredge. There was thus only one fatality actually arising directly from mining-work.

GEOLOGICAL SURVEY. During the past year the staff of the Geological Survey has been augmented by the appointment of a Geologist, two Assistant Geologists, and a Field Assistant. With a' view of expediting the work it has now been decided to still further increase the staff.

Slice 1909 until this year the Geological Survey has never had more than two parties in the field at any one time, but during the latter part of tlve past season three field parties were employed, one in the Waikato district, one in

the Whangarei district, and one in the Coliingwood district. The area geographically surveyed comprised about 1,100 square miles. SCHOOLS OF MINES. The expenditure by the Department on the Schools of Mines at .Coromandel,' Thames, Karangahake ,Wailii and Huntly in the North Island, and Westport,* Reefton and Dunedin in the South Island, for the year ended 31st March, 1920, was £4,505. SUBSIDIZED PROSPECTING,

During the year ended 31st March, thirty-eight approved prospecting-par-ties were granted subsidies amounting to a total of £3,554 6s Bd., of which -sum £1,520 Is Ad was expended during the period. Under Part X of the Mining Act, which was amended last year so as to make more generous provision for the granting of loans to mining companies, several applications for loans have been received. One loan of £IO,OOO lias been granted to a gold-mining company, and one of £5,000 to a coal-mining company; four applications have been declined as the conditions were not compiled with, and others are under consideration.

TOYERNMENT PROSPECTING DRILLS.

Extensive use has been made of the Department’s diamond and Keystone drills, and the regulations relating to the luring of these have so improved that the use of srnffi drills may be in greater demand in the future, ROADS AND TRACKS. The expenditure in tlie form of subsidies and direct grants upon roads on. gold-fields amounted to the value of £8 gold-fields amounted to £13,096, as f compared with £4,185 for 1918 and £6,911 for 1917. WATER RACES. The Kuinara and Mount Ida waterraces have been maintained during the year at a cost of £4,056. Thirty-seven miners were supplied with water, and gold won to the value of £B,IBO. Cash received from sales of water amounted to £1,398. OUTLOOK AND SALES. The gross output of the State Coal

mines for the year .was 156,228 tons, as compared with 214,9.19 tons for last year, a decrease of 58,691 tons. Point Elizabeth Colliery produced 33,553 tons of marketable coal, a decrease of 48,499 tons on the production of last year., Liverpool Colliery produced 115,600 tons of marketable coal, a decrease of 9,579 tons on the precious year’s production. The total sales for the year amount-

ed to 149,850 tons ,value £192,958, as compared with 202,755 tons, value £256 226, for last year, a decrease in quantify of 55,905 tons, and in value of £63,268. .. , „ The average price per ton realized oi the total slates. for the year was £1 ss‘ 6.p4d., an increase of 5:75. on last year’s..average. .... The sales of coal, etc., through the medium of the depots totalled 40,157; tons, value £80,Q83 as against ‘46, <2l; tons, value £55,200 'for last year. - There was a- profit of £5,787 made on winning coal at the mines’, and afterdeducting the .losses sustained by thedepots, amounting to £5,766, there remained a credit balance of £2l on year’s operations. Since the close , the last financial year and shortly b - fore the termination thereof, increasedhewing rates, increased wages, mcreas--ed freights, and increased cost of 1 handling the coal until it reaches the consumers have from time to time been naid. In view of this it will be neces‘sarv to increase the selling prices ot coal which, have remained stationaij since the Ist July, 1916;; otherwisethere will be a substantial loss to be faced at the end of tlie current financial

ITEMS FROM BALANCE SHEET * The following items taken from tlio; balance-sheet will prove of interest as indicating the more important items ofs expenditure, and for reference in re-.-spect to the position of Capital Aetonn reserve .funds, and other accounts shown therein: — The total, amount paid as war boiiu was £15,574.

The amount written off for depreciation i'or the year was £11,472. The payments for interest totalled £8,933.

The payments for sea carriage of coal amounted to £54,844.

The cost of railway haulage amounted to £16,862.

The total wages paid for coal-winning was £72,162.

Tho amount paid for management and office salaries (Head Office and mines) totalled £3,588. The gross capital expenditure on the whole undertaking to 31st March last tvas £466,700.

The total depreciation written off to date (equal to 51.78 per cent, on the gross capital expenditure) amounts to £231^340.

The debenture and loan capital stands at £227,601. The sinking fund is in credit £13,200. Tho reserve fund stands at £5,884. The amount at credit of Profit and Loss is (last year £38,650), £38,670.

Tho cash in hand and in the Public Account at 31st March last was (last year £119,843), £IB,OOO. Tho present net book value of permanent or fixed assets is £209,106.