OIL WORKS CLOSE DOWN

Evening Post, Volume CIV, Issue 36, 11 August 1927, Page 14

OIL WORKS CLOSE DOWN

What "The Post's" Sydney correspondent describes as "another industrial disaster" is the announcement, following close upon the Mount Morgan decision, that the Commonwealth Oil Corporation has been forced to acknowledge defeat in its four and a half years' efforts to revive the shale oil industry at Newnes (New South Wales). It has called for tenders for the disposal of its assets, comprising shafts and mines, movable plant, machinery, still, retorts, and many other kinds of equipment used at their works. To many causes is assigned the failure of what to the layman should have been a profitable business undertaking. The shale is there all right—experts have proclaimed Newnes the richest shale oilfield in the world— but the trouble has been to place the refined product on the market at a profitable figure. High wages and labour unrest have been in part the cause of the closing down. The main trouble appears to be that the oil industry is faced with over-production, and this in turn has resulted in an international trade war which has forced prices down to a level at -which the Newnes product cannot compete. Some time ago the Commonwealth Oil Corporation offered an interest at the works to its workmen, providing the Federal Government guaranteed bank interest on capital invested and paid compensation for any damage to the company's assets. This offer was rejected by the Government, and Newnes and its buried wealth will have to await a more favourable opportunity. The capital of the company, mostly English, was £1,500,000.