Taranaki Oil Wells

Taranaki Daily News, Volume LVI, Issue 173, 21 January 1914, Page 7

Taranaki Oil Wells

• INNER HISTORY. ■ * STORY 01' FLOTATION. .SOME- REMARKABLE STATEMENTS. (X.Z. Herald Cor 11 (..) London, ."Deceit ber 13. How the British Empire Oilfields, Limited—a subsidiary concern of the Oil Trust—carried out the notation of the Taranaki (New Zealand) Oil Wells, Ltd., was told by Sir John Harrington (chairman of tin; Oil Trust, Limited) at the. third ordinary general meeting of the latter company, which was bell yesterday at River i'late House, City. First of all, Sir .John «aid it was a misfortune that lie had become associated with the concern. (ileer, hear.) When be joined the company be believed that the statements made to him worn true, lie told them in the early stays of the company that be was a novice at the business; that be, in his ignorance, could not be expected to pit himself against experts in oil and finance. Had be not stuck to bis position not a penny, lie believed, would now have been in their coffers. He commented severely on certain transactions, observing that some of them were carried through without his knowledge and approval. In the course of bis speech Sir John Harrington said: —"The lirilish Empire Oilfields, Limited, was used by tile pravious directors of the Oil Trust for the purpose of carrving out the, dotation of the Taranaki (New Zealand) Oil Weill, Limited. No shares of the British Empire Oilfields had up to this date been issued, and no shares have ever been issued to the public; £IO,OOO of shaves were issued fully paid to the Oil Trust, and £IO.OOO of shares were issued as fully paid to Mr 11. J. Brown, who was then the managing director o' the Oil Trust. These are the only shares issued, with the exception of a small number held by the directors of the British Knipire Oilfields, and paid for. The reason given for Mr Brown's; receiving this block of shares-which holding VouH haw given him a-balf interest in any profits made by the British Knipire Oiliields—was as follows:—Mr lirown proposed that Mr ,1. ]). Henry should be sent to New Zealand to loo!; at certain oil properties there, but Mr J. 1). Henry had a sort of partnership agreement with Mr 11. J. Brown in regard to a newspaper they were running. In consideration —and I have no doubt that this will appear as extraordinary to you as it did to mo—of Mr Brown's releasing Mr Henry from certain obligations under the arrangement I have referred to, Mr Brown received £IO,OOO shares'in the British Empire Oilfields. Til]! TARANAKI FLOTATION. "In the opinion of your directors, the dotation of the Taranaki company shouid have been carried out by the Oil Trust. I do not see that there was any need for this business to be pit through by a separate company, so that one member of the Hoard might considerably benefit therefrom. (Hear, hear.) When I. became aware of the arrangement 1 determined that, as soon as I bad obtained sufficient control cf the company, I would see that the Oil Trust received the full benefit of the hV.tali.,.l of the. Taranaki (New Zealand) Oil Wells, Ltd. [ As vou will see from the annex to our [ report. : Mr" Brown liaiidc'd'his 'bidding J shares in the British Knipire Oiliields to the directors of that institution, and the same directors arranged to band tin. shares over to the Oil Trust. The Oil Trust, therefore, received the fill benefit from the Taranaki flotation. All the money necessary to carry out the. flotation of the Taranaki Company was lent to the British Knipire Oilfields by the Oil' Trust,' The profit which the Oil 'trust made out of the transaction was included in the last balance-.-hcct, and, with other profits made, had to be utilised for the purpose of writing oil' a portion of the preliminary expenses and a portion of the 10-ses made by our predecessors. We have not wound mi the British Knipire Oilfields, as we thought; seeing that the company had cost the Oil Trust about £730 to regi-tor, it was a pity to wind it up. 1- is not costing us anything to keep it, alive, as none of the directors or muiuigii'g director are drawing any fees." UEPLIES TO CRITICISES. Sir John severely criticised the policy of the previous directors of the Oil Trust, and continued:— "The Board has been occupied in a surgeon's job. It has been trying to cut off the dead members of the body,

and trying to put iconic lit tit l extra life into those members which still have some life in them. The Board has been largely occupied during the past twelve months and more, since 1 have come into control, in getting rid of the debris mid Die rubbish, A suggestion !'.:i.- been made to me that there is a possibility on the part of some shareholders that voluntary li'juidation may be suggested. ("No, noV') I think I may as Well Ml you right away that if I have anything to do with it there will be no voluntary lh|uidatioii whatever. If there \« to be liquidation at all it shall be a compulsory liquidation—(hear, hear)—and 1 shall invite the assistance of the Board of Trade." ' Cltiniately a small committee was appointed to assist the Board, and the report and. accounts were adopted. STATEMENT BY Ml!. lIFXUY. Til 10 NEW ZFALANI) PART 01' THE BUSINESS. London. December 1". This morning Mr J. D. Henry, interviewed by a representative of (be New Zealand Herald, said he had just readone of the newspaper reports of the Oil Trust meeting, "and frankly,'' he added. " I am professionally sorry and ashamed to think that I was ever eonnet-ted with such a business for even the short period of a year. T am prevented at this juncture by professional etiquette from going into details. I can tell yo >. that I ceased to be connected with the Oil Trust when Taranaki (New Zealand) Oil Wells, Ltd., was formed, and when the company was. removed to other offices. I never bad anything to do with any of the foreign deals which brought the Oil Trust into a staU of chaos, though during my short slays in London I did protest against some of them being taken up. mid the one and only business which bad my support, and for which ' worked, was the formation of the Taranaki Company. " i esterday's' meeting was « welter of misrepresentation and wild exaggeration. There was a burlesque history of the British Knipire Oilfields, Ltd. ' It is a mistake to sny that Mr Brown sent me out to New Zealand. 1 went there to cam- out plans which 1 myself prepared and'submitted to the Board. I had ;.h----•solulely no nfoncy or share interest in (he coi.ip.niy. No doubt the history and transactions of this concern will be in-' quired into. I hope so. It is stated that this Oil Trust offshoot never issued shares. This also is nor correct. A subsidiary syndicate wr.s formed and financed to push the shares, (he financial papers regularly published British Empire quotations for six months, shares wore quot"d on the Stock Exchange at a premium, and I unders-ood tliai there were actual sales'. No mailer who has made money out of this business. I have not: indeed', my work in the interests of New Zealand oil has unfortunately cost me much in both time and money. Still, I was pleased to make tile sacrifice. 1 like (lie people, and admire their splendid devotion to the industry. It was this company which did the Taranaki fiotation. and respecting ii and everything else connected with this deplorable business., well, that is about all I , care to sav at the pre-cut time." "Will the meeting do New Zealand oil anv harmV' Mr Henry replied: ''l hope | not; but 1 fear it may."