C—3b.

Ghneral. No prospecting has been done during the year, except superficial examinations of the isolated portions of the reserve. It is evident that the far-away south-eastern portion of the reserve and the adjoining areas should be thoroughly tested and examined for workable seams. Whether the result of the better arrangement of tonnage or not, the mine has been well served with railway-wagons during the year, no difficulty obstructing the shipment of the increased output. If the same working-time can be maintained, and the same liberality shown the mine by the Railway Department in the matter of railway-wagons, the output for the current year should reach 70,000 tons. It is gratifying to remark that the demand for this coal still continues, the Railways commanding the bulk of the screened output, whilst gasworks and other consumers are using a fair proportion of the small, the screened nuts going chiefly for smithy purposes. The working agreement entered into between the management and the workers in the last month of 1907 lapsed with the close of the year, but is still being worked under, pending a new one being entered into. The officers have performed their duties in a most satisfactory manner, and I am indebted to the Consulting Engineer for valuable assistance rendered in connection with the working of the mine. I have, &c, James Fletcher, Manager. The Under-Secretary, Mines Department, Wellington.

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