Manawatu Evening Standard. WEDNESDAY, SEPT. 25, 1935. OIL PROSPECTS.

Manawatu Standard, Volume LV, Issue 255, 25 September 1935, Page 6

Manawatu Evening Standard. WEDNESDAY, SEPT. 25, 1935. OIL PROSPECTS.

A matter of interest was raised in a question placed before the Prime Minister by the member for Waitomo (Mr W. J. Broadfoot). Asked whether he would prosecute exploratory work to ascertain whether petroleum exists in New Zealand, Mr Forbes affirmed the Government’s intention to undertake the necessary examination of strata where indications point to the existence of oil. He stated that much geological and geophysical exploratory work had been carried out, but drilling was an expensive matter and enquiries were proceeding as to whether such expenditure was justified. As to the question of legislation regarding prospecting and the development of oil that may be found, Mr Forbes stated that the subject- had been discussed during Ills visit to Britain, and tlie. Government had it under consideration. The wisdom of careful exploration to determine the extent to which oil may be obtainable must be recognised, as well as the need to develop flows in the country’s best interests. Britain’s legislation has an important bearing upon both of these points, as it is designed to safeguard the national interests while satisfying commercial requirements for testing the existence of oil supplies. Commenting upon the importance of finding oil in England, when the legislation was under dismission, a writer observed that Britain imported about eight million tons of oil a year, and so far as was known the rest of the Empire was almost as barren of supplies as Britain herself. After the Great War the State financed prospecting to the extent of more than half a million pounds, and private interests also undertook boring surveys. But oil in commercial quantities so far has only been discovered at Hardstoft in Derbyshire. Eleven borings were tried under authority of the Act of 1918, which made indiscriminate boring possible, but _ only three licenses giving authority to search for oil were recently in force.

This Act, it has been explained, regulated the search for oil but left unanswered se.veral important questions which would arise if and when oil was found in. additional areas. The legislation of last year provided the answers by authorising the compulsory acquisition of rights to enter on land under procedure according to other legislation. In decidingany application the authority must have regard to the effect on the amenities of the locality of the proposed use of the land, and in determining- the amount of compensation allowance is to be made for the compulsory character of the acquisition. The Crown becomes the owner of the petroleum and natural gas. There can be no question of course, the -writer says, of the enhancement of the present value of land by reason of the existence underneath of oil which is not yet proved, or so much as suspected, and which, although reached from one property, may be drawn from beneath other and relatively distant properties. The landowner therefore suffers no loss by the State’s assumption of the ownership of what exists only problematically, and lie will be fully compensated for any surrender of surface rights. Should oil he discovered in commercial quantities, the State is empowered to make a bargain with a development company for the sale to it of the oil that is tapped. This legislation, which has been described as quite reasonable, was investigated by Mr Eorbcs during his visit to England. It is worthy of note that Britain is also producing annually the substantial quantity of thirty million gallons -of motor spirit from coal derivatives, and interest in the subject has been shown by this Dominion sending Home a highly qualified official to watch developments _in hydrogenation. Encouraging results have followed the research into New Zealand coal, and from the investigations now proceeding in Britain, New Zealand, it is not unlikely, may in the future find a considerable use for her coals in this direction.