PETROLEUM NEWS.

Taranaki Daily News, Volume LVI, Issue 268, 11 April 1914, Page 6

PETROLEUM NEWS.

THE BLENHEIM COMPANY. ANNUAL MEKTLVi OF SHAREHOLDERS. (Marlborough Express.) The potentialities of the. oil industry in the Taranaki district, particularly that locality in which a Marlborough Company is interested, were encouraging rem'escnted at the annual general meeting of shareholder of the'Taranaki Oil Lands Acquisition are! Development t.'ompany, Limited, in the Blenheim I'oroiigh Council Chambers on Saturday afternoon. Mr. 1!. E. Oouiier (chairman of director-) presided over an attendance of about twenty-live shareholders, and .Messrs K. (.'ritiiths (managing director) and (!. M. M'Kav and o.'il.'(iumi (ili- | rectors) were also present.

A RESr.ME OF I'MOOKIvSS. Tim report, which has already been published, , and had been forwarded to individual shareholders, was taken as read, together with the printed balancesheet.

In moving its adoption, the chairman mentioned that when the directors Visited the oil-field they were extremely satisfied as to the thoroughness of the preliminary work done, and for this satisfactory state of all'airs the management of Mr. Fcdorowicz was to he, commended. In fact, he considered, that the Blenheim well was the- best equipped in the Dominion, and great credit was duo to -Mr. ¥.. Orifiiths (managing director) for securing such a capable manager as Mr. Fcdorowiez. I'egarding their prospects of success, he was very optimistic, despite the set-back they received reeenllv owing l to water troubles.

In seconding the motion. Mr. E. (Iriffiths (managing director) discoursed comprehensively on the exploitation :t:ld prospects of the eompan;,. His address was as follows:—Any report from the directors must necessarily lack novelty, because 1 have kept my promise to shareholders of sending out monthly a detailed statement of operations for the month, and I have thus kept you posted in a manner which is certainly not common to.companies. I do not know whether my work in this way is appreciated by shareholders in general, but 1 hope it is. I am not only anxious to retain your confidence' to the fullest, but 1 want you to take an interest in the company's operations and to understand them. f feel sure that if you can follow what lias been and is being done you will have a sense of appreciation f:;r the management—l mean the technical management—and, more important .-.lid, •,on will have confidence in the certain site-

cess immediately awaiting our operations. "It is true that the co.-'. of oar machinery, casing', and general out lit, has necessitated n much heavier expenditure than was at first anticipated; but this money has all been wisely invested—every article purchased is in splendid order and is good value. The equipment is sufficiently strong lo enable drilling to be carried on to a depth of aflllfl feet if deemed advisable. The cost of drilling a large hole is greater in every J way than with.a small one. The IJlenI heim bore is live times as great in size as the older wells, and is cased to about 2200 feet with 9-inch casing. Then we have a very complete installation for ro- / e.eiving the oil and passing it from the well to storage accommodation. We have a powerful steam pump and a pipeline 250 yards long, which will unable us to pump oil direct to the relinery if necessary from our storage tanks. The gas from the well is captured and led by piping to the boiler, where it will be. consumed as fuel. An up-to-date installation is now completed for burning, our refuse oil in the boiler:'-also, by burning' tlie gas and this refuse oil we are in future quite independent of coal hills. Tiiis means a considerable saving to our working expenses. The question of storing oil has been a worry to us in the past; but our two first iron tanks lir.vo arrived, and erection should be completed in about three weeks' time. 1 mention these items because they are absolutely necessary equipment when oil is being produced, and they cost money. ".Vow, as to the Blenheim, well itself. It is a line piece of work, and shows how wise and fortunate tlie company has been in securing the services of Mr. Fedorowicz to supervise our operations, and in securing the drillers hr- selected for us in O'alicia. You have heard of tjhe water entering at our first oil supply. We abandoned that level, drilled deeper, fixed the casing, and isolated this, undesirable water: then drilled deeper and encountered a second supply of oil. Tlie well is free from water, and as the production of oil by self-How is greater than the self-flow from the first oil level, it should when pumped yield not less than 50 barrels daily, it is never wise when discussing oil matters to state one's anticipations in figures; but I hope I am setting a safe minimum when anticipating'our daily production at 50 barrels., which is equal to 2100 gallons'. Pumping should start about the end of next week. The losing of our first oil so soon has been, disappointing' to all concerned; but I should like shareholders to realise that the well produced 20,000 gallons from this level before it was abandoned, and nearly 20,000 gallons have been taken from the second level. The projection from (hese levels places the Blenheim well in a class by itself, for none of the wells drilled before or since has been able to get 'more than a showing of oil at i\\%? shallow depths. This is entirely owing to the quality of the work done bv 'Mr. Fedorowicz, and clearly'shows how'-'pos-sible it is for a well, unless drilled under expert supervision, to pass through good oil without obtaining any production. This opens up another very important question for us to speculate upon. It is this: By drilling «0 feet deeper the Blenheim well will reach the same corresponding level with that at which the older wells gave their first production of oil and gas. Now, if we have produced 50 barrels of pure oil daily from levels which have proved unproductive in the older wels, is it not reasonable to assume that when we reach the level at which the older wells have become productive we may expect a production mueli in excess of 50 barrels dnil.V I think this is a fair deduction to make. It is certainly mi interesting anticipation, and so soon as the present level is exhausted the GO feet will sooa be drilled through. "Some people arc worried at the possible dilliculty of disposing of our oil; but I cm relieve your minds on this point. ' Kven if the company owning the refinery should fail in raising suilieient funds to enable it, to carry on. or if it should be unwilling to p:iv a fair price for our oil, we have various outlets for it. As our oil is produced absolutely free from, salt water, it is distinct in this respect from tlie oil of the older wells, and is being, much appreciated by users of Dicssel oil engines in various parts of Xew Zealand as a fuel oil. At first it was tried with some misgivings; but now that it lias proved thoroughly satisfactory we are <>'ettin<

repeat orders for increased quantities. This week we received two orders of 21) aiu! 50 barrels. Though other wells recently drilled in Taranaki have not liroved productive, 1 have everv confidence in those under Mr. FcdoVowiez's supervision becoming good producers. As oil becomes stored and produced regularly, and people are satisfied that they can rely upon getting steady supplier of oil for niel purposes, I am convinced that steamers running oa the coastal service of the Dominion will soon be adapted to its use. There is an ever-increasing demand for oil the world over, and the price is steadily increasing. Your management has no fear on the question of the sale of the oil. "Your directors have decided that a second well at Moturoa shall be put down 'at the earliest moment possible. -Mr. Fcdorowk-z savs we. may estimate the cost at MJ(!:>()(!.' It is intended that this sum shall be available by oll'ering the Tillllt unallotted shares to the subscribing shareholders pro rata to their present holding at par. If any shares remain unapplied for they will be then oll'ored at a premium to the public, but the shareholders are to have the first right to acquire them. By calling up Ms the sum of ;c;rlM will lie received, am! the balance will be taken from moneys received for sales of oil. "1 have already advised you by circular letter of the deputation of the fire oil companies which waited upon file Minister for Mines and urged him to make regulations for controlling boring operations in the Moturoa and all other oil lielils in the Dominion. We were forced to do this in self-protection. Mr. Fcdoruwkz advised us that some, of the oidcr wells in Moturoa were doing serious harm to the field at the higher levels. We. together with other companies, wrote to the Taranaki Oil Wells. Ltd.. urging them to give attention to the wells that the harm complained of should cease. They turned a deaf ear to our appeal, and we then felt that athey would not, as a common partner in the Held, assist us in protecling it from damage, our only plan was to force J them to do so by gelling regulations I made and etl'ectuallv earned out in aII j the oii fields of the world. The Minister gave us a most sympathetic hearing, and 1.1 am pleased to tell von that, reanlaliuw 'will in a few days'be gazetted, which j will give complete ell'ect to the reiquisition brought before the Minister by {file deputation. Though certain person-, have for personal motives written to the newspapers in scathing terms denouncing the action of the deputation. I em 'confident (hat when the new rrgu'itions have been in force far a year. thos. interested in New f'lymonlh oil operations will be able to appreciate the good work of the deputation. The el'feciual j enforcement of the regulations is absolutely essential to the produr-lion of oil. for without them there, is nothing to prevent a neighbor putting down an improperly drilled well and by the inj tn.sion of water ruining our well, no I mutter how great its production may be.

"In case some shareholders do n:,t understand our relationship with the I.'uifeded Oil Co., I should explain that in a locality some few miles cast of New Plymouth we and> two other companies held extensive boring rights. Mr. Fedorowicz holds a very high opinion of the oil prospects of this locality, and consequently the three companies decided to join forces in putting down a h-.re, each paying one-third of the cost. .So many difficulties then arose that we decided to poo! our rights in the approved territory by transfering them to a company to be called the United Oil Company. Ltd.. and each of the three companies should take up one-third of the shares in the United Company. If oil is found by this company it will prove of very considerable value to us, for the eompanv holds rights over between •2000 and 3000 acres, the greater part of which should prove oil-bearing. The well is more than 700 feet down, and the indications so far met with are particulirly encouraging. "In commenting in a general way upon our all'airs, I may say that 1 inv" most jealously guarded tlie company's interests in the purchases made, quotations or tenders being invited for the greater part of the expenditure. Then again there have perhaps been few instances in any part of the world in which an oil company starting from bedrock, as we have done, baa been able to show value for f-iil won in its first bal-ance-sheet. In my opinion we have every reason to consider that our operations so far are highly successful ami will result in much financial prolit to the shareholders.

"In conclusion, I want, to nuke succial reference to our held Manager, ill - . Kcdorowiez, and our working stall'. Mr. Fodorowicz came to us as a man highly recommended by Sir lioverton Redwood; tliat in itself is sufficient to satisfr us of his ability as an oil expert. But he I is more than that—lie is geologist, he is an engineer of very high degree, and there appears to be nothing' appertaining to the winning and storing of oil that he docs not understand. I have lo spend an average of an hoar daily discussing the affairs of the company with him, and 1 find his patience, diplomacy, and tact arc such as to make any politician envious. He lias a wonderful control over his men. who swear by him. They have learnt that though he is exacting he is fair—they perhaps respeel, him most for his genius. His work is his hobby, and he is a loyal servant of I the company. As I visit the Blenheim well by motor-cur on an average more than once daily J know something of the work being done.

'■The splendid equipment and installation of our boring plant, reservoir, and pipe-lines would hardly be possible without such a master smith as Kojeek. The clever dressing and sharpening of the dialling bits is his special care, and in this matter the rapidity and clean cutting of the bore is due more to him than the casual observer can know. Like Kojeek, our two drillers, Ukleja ■mil Fruzynski, came from the (ialician oilfields, where they were well-known as able drillers. The excellence of their work is shown in the Blenheim well. They have been ably assisted by local men, most of whom are working with a I will and intelligence indicating a div.ire to eventually become master drillers. 1 wish to take this opportunity "f thanking all for the splendid work they have done, often under very trying and objectionable conditions."

The report ami balance-sheet were adopted. Mr. (iriffiths was questioned by shareholders on various phases of the work and regarding liir.iurial detail'-. !" •'•.'■:■;.'

lie stilled that liie mete:':' adopt.-.; 'hv Mr. Kcdorowirz in wijuiisiji the oil was to draw from ouch strata until t..e pro.iliietioii decreased anil been me unsatisfactory, and then bore until a further stratum was reached. A conservative estimate of tile production was 50 barrels per day, which when sold at, say. Ids a barrel a low estimate would, after deducting cost of production, yield a prolit of'jEOTHI :' year. The'oil did not depreciate in value through storage in iron tanks: Ibis happened only in t''e ease of underground tanks. THE mKIOCTOHP. In accordance with the Articles of Association. Mr. 11. F. (loulter retired from the directorate, but was re-elected. Mr. Ceo. Horn was appointed lo tiil the vacancy caused bv the retirement of Mr. J. Bary. Mr. T. Huxtoii. (New Plymouth) w.i, appointed auditor. On the motion oi Mr. Bishcll, a vote of thanks was passed to the iminagcment, particularly Mr. K. Orillith-. and Mr. Fedorowicz, for their faithful services in the interests of the company.