PETROLEUM.

Taranaki Daily News, Volume LIII, Issue 197, 29 November 1910, Page 3

PETROLEUM.

THE TARAXAKI COMPANY. Tlie following is the directors' report to be presented at the fourth annual general meeting of the Taranaki Petroleum Co. on Friday, December 0: Your directors, in reporting on tlie operations of the company for the past year, are pleased to inform the shareholders that never in the history of the company has there been so much accomplished at the company's work and never so much oil von.

Management.—Mr. W. A. Simpson having resigned his position as manager of the company as from the last annual meeting, Mr. L. Keith was appointed to fill the vacancy thus created and has proved himself a capable manager. Increase of capital. —During the year the shareholders were called together by an extraordinary meeting to consider the proposals put forward by the directors for increasing the capital of the company from £120,000 to £130,000 by the creation of 30,000 £1 preference shares, which were first offered to the shareholders and afterwards to the public. The propositions of the directors as submitted were approved by the shareholders.

Accumulation of the oil.—The accumulation of oil at the company's works makes it most desirable that the crude oil should be turned into a marketable article, altogether apart from the fact that it is taxing the management in mak-

ing provision for the storage of the crude oil. The limited state of our funds, as also the hcavv expenditure involved in the- erection of a refinery, make this at present impossible, and much will depend upon the number of preference shares applied for; were the whole of the 30.000 preferences taken up, the company would be in a position not only to proceed at once with the erection of a refinery, but have sufficient funds to continue to -develop the industry.

Oil fuel.—The recent decision of the Admiralty to supersede coal by crude oil for steaming purposes has given a great stimulus to the oil industry all over the world, and with a view to attracting attention to our own industry, your directors have donated 25 barrels of crude oil to the Admiralty at Home for test purposes. The same has been forwarded to the High Commissioner by the courtesy of the New Zealand Government. The Minister of Railways for our own Dominion is also testing oil against coal for steaming purposes, and one hundred barrels of crude oil have been procured for experimental purposes on our own railways.

Boring rights.—During the year your directors have been successful in securing boring rights over options expiring on October 1, 1910. These options have now been extended to October, 1912. Miniature refinery.—Your directors, realising the necessity for bringing the oil industry more directly before the public, have, during the year, on the recommendation of the manager, purchased and erected a miniature refinery at the company's works at Moturoa. This has proved a splendid advertisement for the company. Some hundreds of samples of refined oil have been distributed in and beyond the Dominion. A working exhibit was the centre of attraction at the Pal-mc-rston North Show, as also an exhibit at the New Plymouth and Hawera Shows, which most conclusively proved the potentiality of our oil industry. Gas for firing.—By utilising the gas from No. 2 bore for firing purposes, a considerable saving has been effected in the working expenses of the company. \Vitli night and day shifts the consumption of coal has been heavy, but since the gas from the bore has been controlled and led directly into the furnace it is estimated that at least £7 7s per week, equalling £2OO, has been saved to the company to the end of the financial year. Geological survey.—The geological survey commenced by Dr. Bell, Government Geologist, during the earlier part of the year in this part of the district is now being completed. A complete survey of the oil-bearing country will prove of great value, not only to your company, but to the development of the whole industry.

Sale of company.—Your directors fully realise that to develop an industry with such possibilities as are already in sMit demands a much larger capital than" is at present at their disposal, and with the view of giving the fullest information to intending investors certmed copies ot all documents relating to tke company's assets have been forwarded to the Bank of New Zealand in London, where they can be inspected.

Bores.—Under the management of Mr. Keith, good progress has been made at all the bores which are being operated. No. 1: Operations at this bore for a considerable time had been suspended, but with the completion of drilling operations at No. 2, it was decided to transfer the staff with a view to drawing the 6in casing, thoroughly clean out the well and insert Sin casing, and as quickly as possible add another flowing well to the company's property. It was the splendid indications at this well that stimulated the formation of the present company. Steam for running the machinery at this well is being supplied from No. 2 bore. No. 2: Boring operations were suspended at a depth of 3030 feet. This well, which is really the test well of the company, has been flowing continuously since Janii- | ary last at the rate of 100 barrels weekI ly; while boring operations were pro- | ceeding it was found impossible to separI ate the oil from the fine papa, and consequently large quantities went away | with the silt, but even this has not proved a total loss, as the firing at No. 3 has taken large quantities of the oil and silt for steaming purposes. The tremendous pressure of gas constantly coming away with the oil from this bore has also been utilised for steaming purposes, and all the necessary power to work No. 1 has been conveyed from this bore, reducing the cost of fuel to a minimum. No. 3: During the year great activity has been manifested at this bore. The manager succeeded in carrying this bore down 500 feet below the oin casing from where the water was shut off. A vein of gas I and oil was found at 3080 feet which I proved so powerful that it made further I drilling impossible. Sufficient 4in casing not being obtainable in Australasia, it I had to be procured from Home. This has seriously delayed the progress at this I bore. When the casing is put in place it is confidently believed that a well at least equal to No. 2 will reward the waiting shareholders. No. 5: The site on which this derrick stands has cost the company a considerable amount of money to hold, and they have found it necessary during the year to commence drilling operations to conserve the options. I Quantity of oil won.—The quantity »f oil won during the year ended 30th September, 1010," was 76,844 gallons.

Visitors to the bores. —Some 3000 people, including visitors from all parts of the world, have visited the bores during the year, and have been greatly impressed with the prospects of the industry.

Retiring directors.—Messrs C. Carter and J. 13. Roy retire by rotation, and are eligible and offer themselves for re-elec-tion.

Auditors.—Messrs Hush Baily and C. T. Mills, the auditors for the past year, are eligible and offer themselves for re-elec-tion. '