MARTHA GOLD MINING

Otago Daily Times, Issue 23511, 27 May 1938, Page 12

MARTHA GOLD MINING

OUTLOOK FOR FUTURE LIMITS OF DEVELOPMENT (From Our Own Correspondent) (By Air Mail) LONDON, May 7. The view that with the virtual-ex-haustion of the Junction area and the limits of development beginning to appear elsewhere, it was unlikely that dividends could be maintained at the existing rate, was expressed by the chairman of 'the; Martha Gold Mining Company (Waihi), Ltd.,| Mr G. R. Mitchison, at the annual meeting in London this week. Mr Mitchison said that .the 224,353 tons of ore crushed in 1937 represented an increase of 771 tjms bn the previous year, but the proceeds (£454,849) were 7828 less, because the ore was less rich. It yielded lOd a ton less than in the previpius year. , , There was a decrease of £20,000 in the expenditure on mining, but this was because less mining had been done, not through any reduction in the cost of operations. Development work had been less and a substantial quantity of the ore produced during the year was already broken and lying in the slopes. An allocation of £SOOO had, been made to a fund for the benefit of the staff. Most of the New Zealand staff had spent very many'years in the service of the company and the former Waihi Company. They had had many difficult problems to deal with, and it was believed shareholders would welcome this appreciation of industry and efficiency. The taxation increase of £6BOO was due mainly to the Natioha! Defence Contribution, The net; results of the year’s operations was very similar.to the previous one, but it did not follow that it would be, in succeeding years. ,-T JUNCTION AREA EXHAUSTED Work on the ground of the Waihi Grand Junction v Gold Company, Ltd., was practically- completed by the end of 1937. Small quantities of ore from the Junction ground would continue to be raised for a few more months. In the company’s own ground reserves showed a decrease of 15,f<19 tons in general account and 4394 in suspense account. The development footage of 8415 ft was a reduction of 776 ft on the previous year. The ground lying to the west of No. 2 shaft was still being tested by cross-cutting and driving, and there was room for considerable tonnage if the reefs widened out. Results so far had not been so satisfactory as to justify much hope for the future. This work would virtually complete all lateral exploration in the mine. ■ The diamond drilling programme was completed without any new ore bodies being disclosed. The problem of future ore supplies had become more acute. The ore forming the suspense account reserves was in pillars and arches left to support the various shafts and levels of the mine. Its extraction was a difficult problem, but the New Zealand Executive was engaged on a scheme which he hoped would enable it to be win in the most practical manner. * f In addition to the 40-hour week, extra pay for Saturday work had now to be provided The full effect of the resulting increase in working costs would be felt in 1938. ■ The New Zealafad Parliament had decided that the company should pay tax on the last two dividends of the old Waihi. Company. The tax could have been, but was not, claimed at the time, but it served no purpose to discuss objections to the circumstances of collection. The sum involved, £27,000, would be dealt with in the present years accounts. v DECREASING ORE SUPPLIES To summarise the outlook, the Junction area was practically exhausted; in 1936, 1937 and this year, development in the company’s own area had led to no substantial results. He had said last year that limits of development were beginning to appear. They were now tolerably clear. There was little to be expected from the mine which was not already known. Regarding the difficult problem of maintaining ore supplies to the mill, the future depended on the quantity remaining in the mine and the rate at which it could be raised. In time supplies to the mill would fall off. and the costs of treating each ton would tend to rise. Tax burdens were no less; labour costs were higher. , . , It was as clear as anything in mining could be that the 1938 results would not be as good as in 1937. Out put and the average value of the ore in the first three months of this year were both lower than in the same period last year. In view of these differences it was unlikely that dividends could be maintained at the present rate. Beyond that he did not venture to make a forecast. It was not a pleasant prospect to those interested in this old-established mine, but it could not be expected to continue for ever. NEW ZEALAND DIRECTOR’S VIEW At this stage the New Zealand executive had a particularly difficult and thankless task, but they had handled matters with competence and judgment. He extended a particularly warm welcome to Colonel R. G. Milligan, the company’s local director and attorney in. New Zealand, who in the present position of affairs, had been inyited to visit England to give the directors the benefit of his unfailing judgment. Colonel Milligan supported the chairman’s remarks .as to future prospects, and pointed out that the mine had been running for over 50 years. One of the factors ‘was the rate af which dte could be got out. It might be possible to run for longer by cutting down tonnage, but there would be trouble as soon as this was done. It was rather difficult to hold out any prospects of profits again being on such a scale as in the present accounts. Two shareholders expressed an optimistic view for the future of the mine. Mr W. H. Lovatt considered that it would be working for another seven or eight years, and pointed out there was enough broken ore alone in the mine for another year’s supply. , ~ Mr H. Espir said they had often listened to a depressing tale which had never really materialised, but it did not look as though they should mislead themselves into hoping for the future very much better than they had been told.. Somehow or other, though, the mine seemed: td’ find very tasty morsels just when the need was greatest. The report and accounts, details of which have already been published, were adopted. Mr Mitchison was re-elected a director. The final dividend of Is a year per share, free of income ■'tax.-%as approved.’