State's Control of Oil Resources

Sun (Auckland), Volume I, Issue 130, 23 August 1927, Page 8

State's Control of Oil Resources

LEGISLATION LIKELY AN INTRICATE PROBLEM (THE SEX'S Parliamentary Reporter ) WELLINGTON, Tonfay' r £' HERE is widespread recognition of the need for legislation to govern the recovery of the petroleum resources of the Oomi. nion, but departmental lips are absolutely sealed on the question and the most persistent inquiry fails to elicit an official hint of what is likeiy to be done. That there is a bill on the horizon seems to be fairly evident, how. ever, which indicates that the Government is willing to tackle the cuestion. Once opened up this subject probably will prove more intricate than anything contemplated for the Statute Book to-day, and mention of it in departmental circles invites a danger signal. The subject is full of technicalities for many reasons, one of which is that immediately the Government steps in and endeavours to exercise control there is almost certain to be the suggestion of State interference The difficulties of the authorities in' crease with realisation that the greater portion of the petroliferous land in New Zealand was alienated by the Crown many years ago, and much of this has been closely subdivided, and is now held under many different tenures. In some cases mineral rights were reserved by the Crown. in others this has not been done, in ad dition there are native lands and many kinds of endowments, the tides to which include minerals. The views of Mr. A. H. Kimball, Under-Secretary for Mines, expressed some time ago, convey full appreciation of the difficulty facing the State in enacting legislation in order to obtain the right to prospect for and win petroleum. Great difficulties and great expenditure would have to be incurred in obtaining rights, and it had been found occasionally impossible to induce the landowner to sign an agreement to lease petroleum rights, except at prohibitive costs. What Mr. Kimball suggested, though he made it perfectly clear that this was not the view of the Minister of Mines or of the Government, was that all provisions of existing law should be repealed and a bill dealing specially with petroleum should be passed. The ideal principle of dealing with rights of this kind would be for the Crown to reserve to itself the sole 'right to grant a licence to prospect or lease to win oil. Where petroleum does not belong to the Crown the owners of the land would, of course, be entitled to be paid adequate compensation for any land that may be dam aged or occupied by prospecting and boring, and also a reasonable rate of royalty as well as rental. Provision could be made empowering the Gover-nor-General to declare portions of the Dominion, believed to be petroliferous, to be oil districts. Owners and others interested in this land would be given an opportunity of lodging objections against the issue ol the order, and these objections would be inquired into and reported upon by a responsible person. The Governor-General would be empowered :o decide whether the objections would be upheld either wholly or in part.