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posed to increase the milling-power from 40 heads, as at present employed, to 100 heads. The whole of the milling plant and the greater part of the other machinery at this mine is electrically driven. During the past year 2,600 ft. were driven, risen, and sunk. The Talisman Consolidated Mine has shown a marked increase in production, and the amount of dividends paid during 1906 amounted to £60,000, being double those paid the previous year. Developments during the year have proved considerable ore-reserves, and 5,920 ft. have been driven, risen, and sunk at this mine. On the Thames Goldfields the Waiotahi Mine has again maintained its reputation by producing during the past year 18,002 tons of ore, with an average yield of £12 Bs. 6d. per ton, and as a result has declared in dividends £183,000. Mining operations are conducted upon three separate veins or "reefs," all of which produced very rich ore ; the greatest " bonanza," however, occurs between the 4th and sth levels, and it is from this that the enormously rich specimen stone is obtained, which so greatly increases the average yield per ton. During the year a cyanide plant has been erected, and the extraction obtained thereby is claimed to be 95 per cent. Operations at the New May Queen Mine, also situated on the Thames Goldfield, show encouraging indications of a continuance of the ore-values with depth, recent developments in the low levels at this mine having proved the deepest payable gold yet obtained on the field. During the year this company acquired the adjoining lease known as the " Queen of Beauty," upon which is situated in a small reserved area the shaft and pumping plant of the Thames Drainage Board previously referred to, and it is proposed by this company to continue the said shaft to the 1,020 ft. level preparatory to driving a crosscut to intersect their lines of reef. West Coast District (South Island). At the Progress Mines of New Zealand (Limited) development-work during the year failed to open up any new ore-bodies except in the No. 11 level, where a discovery of value was made. Notwithstanding generally unsuccessful developments, this company have succeeded in maintaining their dividends, the amount paid during the year being £34,375, which equals that of 1905. A diamond drill has been employed in prospecting, and 4,500 ft. have been risen, driven, and sunk. The average value of the ore treated was £1 14s. 5 - Bd. per ton, the working-costs 17s. 10d. per ton, leaving a profit of 16s. 6d. per ton. At the properties of the Consolidated Goldfields of New Zealand (Limited) a considerable amount of exploration, both underground and by the diamond drill, was carried out, but without developing anything of much importance. During the year 1,506 ft. was driven, risen, and sunk at these mines. This company also maintained their dividends, paying £12,119 during 1906. The Keep-it-Dark Quartz-mining Company, after thirty-three years' successful operations, continues to maintain its output, and has recently declared its 177 th dividend; the total amount so paid at the end of 1906 was £154,666. The total amount of capital called up only amounts to £6,208, or 6s. 2d. per share, against a profit of £7 14s. Bd. per share —a remarkable record. During the year a further reduction of 6d. per ton has been effected in the cost of cyaniding, which is attributed to the introduction of caustic soda as a more economical and efficient solvent in treating antimonial ores, thus reducing working-costs to 10s. 9d. per ton, which will compare favourably with those at any mine in the world. The Blackwater Mines (Limited): This property, which was discovered in 1905 by a party of prospectors subsidised to the extent of £200 by the Government, was sold by them to Mr. P. N. Kingswell, who in turn sold it to the Consolidated Goldfields of New Zealand (Limited), who recently turned the same into a subsidiary company with a capital of £250,000, and during each change of ownership the vendors' profits were not inconsiderable. Systematic operations are now being carried out on this property, and a considerable amount of driving and prospecting has been done. A main shaft is in course of being sunk to a depth of 500 ft., a tunnel is being driven to meet if from a creek at a lower level, also another low-level tunnel to connect with a winze for drainage and other purposes. A great amount of work will be necessary to bring the property to the producing stage. (2.) Dredge-mining. This system of alluvial mining, which had New Zealand for its cradle, although now adopted in other countries, has probably produced about seven or eight million sterling of the total gold-pro-duction of this colony, and it is to be regretted that there has to be recorded an annual decrease both in the number of dredges at work and in the gold-production. To enable dredge-mining to be carried out profitably, even when the ground to be operated upon is payably auriferous, it is necessary that a number of favourable conditions shall exist, the absence of any one of which may render unprofitable the undertaking. The presence of snags, or of large boulders, the hardness of the matrix surrounding the same, a hard and rough bottom from which the dredgebuckets are unable to clean up the gold, and in connection with paddock dredges the limited space of operations causing the gold to be stirred up and held in suspension in the muddy water, are all causes any one of which may render unprofitable an otherwise promising proposition. There is therefore no cause for surprise that the system of alluvial mining by hydraulic sluicing and elevating is now being applied whenever practicable in preference to the bucket-and-ladder dredge.