DEVELOPING THE WEST COAST MINES.

Otago Witness, Issue 2197, 9 April 1896, Page 16

DEVELOPING THE WEST COAST MINES.

MR D. ZIMAN'S PROJECTS. AN INTERVIEW WITH MR ZIMAN. Wellington, April 4-.

- The - Post to-night publishes an interview with Mr David Zitaan, capitalist and mining investor, who not long since visited New Zealand from South Africa, and after much careful inspection of several mining properties on the West Coast paid a large sura to acquire certain rights and options to place before English investors. The cab'e informed vi pome weeks ago of the success of Mr Zi man's mission, and yesterday that gentleman arrived here from London, via Australia. As he is principal in what must apparently become a great new departure in the history of mining in New Zealand, particularly of the West Coast, some particulars will be of interest. Mr Ziman courteously absented to an interview, aud the following interesting and valuable information was obtained : — Reporter: You have just returned from a visit to Europe, have yon not ? — Mr Ziman : Yes. „, I hope your visit was satisfactory in every particular P — Oh yes, it was. - ' What is your opinion of the prospects of our New Zealand miuing industries ? — The prospects are certainly good. If .backed up by good management the results should be satisfactory. ' What do you mean by good management P — W«ll, it is not for me to tell you what good management is. I should say economies in the right direction, the employment of good engineers and metallurgists, big reserves in your mines, and a good credit balance at the bank— that is to say, pay dividends only when you can afford it, but on no account impoverish your industry for the sake of dividends only, which may handicap you and prevent a future development of the property. We understand a company has been formed in Europe to take over your options of purchase and the reconstructions of mines ' you have acquired out here ? — Well, yes. Since I loft London I have heard that the St. Swithin'a Lane Exploration people have registered a company with sufficient capital to take over all the mining properties I acquired on the West Coast. This company is also prepared to supply the working capital of new companies to be formed by them. Will you tell me what are the properties the company is interested in ? — Yes. There 10 gronps of mines and other properties :—l,: — 1, Globe, Progress, - Progressive, and Larnach ; 2, Wealth, of Nations, Energy, Gladstone, and Beaconsßeld ; 3, Inangab.ua New Low Level Tunnel, Salisbury, Royal, and Golden Fleece ; 4, Fiery Cross, Seddon, and Cadmau ; 5, Welcome and United ; 6, Caledonian and Bosebery; 7, The Rose; 8, four leases of 1500 acres each adjoining both sides of Humphry's Gully ; 9, large prospecting areas in Maruia and Jackson's district ; 10, also some valuable water rights sites, landed and other mining properties. What amount of gold have these mines produced, and what dividends have they paid ? — They have produced about, 339, OOOcz from about 400,000 tons of ore, and paid in dividends £381,000. *

What is the name of the company that h»a taken, over all your rights in the above-men-tioned properties ?— lt is the Consolidated Goldfields Company of New Zealand (Limited). What is the capital of tbe company ? — The capital is £225.000, ia 225,000 shaiei of £1 each, of which 45,000 shares are reserved. , How much actual ca^h has been subscribed ? —■When the balance of 45,000 reserved shares have been taken up we will have £150,000 cash.

How do you get more' cash, Mr Ziman, than the actual capital of the company ? — Well, I will explain to you. This difference of £25,000 is that when the business was arranged I secured for a friend of mine 5000 shares at 20s. He told me he wished he had 50,000 shares at the same price, and I in a joking way told him he could have them at 30s. He took me at my word, however, and in consequence of this deal I had to reduce participation to other friends of mine, and was the loser of a large block of shares which I had secured for myself. I shall never make such an offer again, as it was the cause of great worry and annoyance in having to give email interests to those who wanted large ones. Well, Mr Ziman, I should not mind being worried at the same price, when you can pocket £25,000 ?— Bilieve me, my dear sir, I never got a shilling out of the £25,000 premium. It baa all gone to tho company, and that explains the difference of having more c»»h than the actual capital.

Has the company paid any shares or money for promoters ?— No, it has had nothing to pay away. All the shares taken up have been paid for in cash, and I have paid for every share iv the same way as others interested in the company have done.

How is that ? You do not give me the idea of being a man who would give away such valnableand costly options and rights without being well paid ? — You cannot realise what my position was, arriving as I did in Europe

when the mining market was only a name, the Stock Exchange showing a loss of over £100,000,000. With rumours of war with America and Germany, and the attempted revolution in the Tr&nsvaal, you would have boen glad to have concluded business at almost any terms. The arrangements were that I should get repaid in cash for tbe money I had disbursed on the properties in New Zealand; and further, that I should receive a founder's interest; in the company after shareholders had been repaid at par for their shares. Then on the whole you are a bit disappointed with your big venture ? — Yes and no. I am, however, not disappointed in having introduced the New Zealaud gold industry to tbe very best firms in iJurope, and with their support the enterprise will, wiihout doubt, prove successful, aud my founder's interest should become valuable. May I ask who are the shareholders in the company ? — Many of them are men of moderate means, like myself. I do not mean those who hold £100 or even £500 interests. I mean those on whom you rely on getting the working capitals subscribed for all those properties which you intend to float into separate companies— Oh, of tbia cla;s of shareholders there are relatively few, but they are the very be&t houses in Europa. For instance, Messrs N. M. Rothschild and. Sons, Anthony Gtbbsand Sons, the Exploration Company, Mr George Jones, the AnglifUi Mining and Finance Company, Messrs L. Ebilich, J. Fain, S. Newm»n, and a fo.w Paris aud Berlin financiers, I had also before leaving Europe asked my co-directors to induce Sir We»tby" Perceval to join our board. I am pleased to say he has accept ;d. Sir Wettby being well acquainted with New Zealand affairs will be of great assistance to our enterprise. You are in very good company ? — Yes. I assure you I am very pleased indeed that I am fortunate enough to be associated in business with such honourable gentlemen, and to have my money in companies which aro directed by them or their representatives. The financial world having auoh unbounded confidence in their fair dealings will greatly facilitate the business of the company. If I may ask, what will your position be onb here ? — M^ position will be sole representative and iniinagiftj; director.

For which, I presume, you will receive » lar^e salary. — No, none whatever. Really. Why not?— Well, I have already told you that the majority of the shareholders are my personal friends, and I am quite disposed to leave to them, when the returns from the various properties are known, wh*fe my remuneration should be.

What is your programme, Mr Ziman ? — My programme is that as soon' as the engineers arrive the firtt work they will undertake is to thoroughly ex»mine the Globe, Progress, Wealth of Nations, and Eaergy mines, with i,otne adjoiuing properties, such as the Progressive, Larnach, Beaconsfield, a,nd Gladstone, to decide what working capital is required. Then we shall form two good companies.

How will you divide these properties into two companies ? — They are practically two groups. The Globe, Progress, Progressive, and L*r,n»ch form one, and the Wealth of Nations, Energy, with portions of the Gladstone and Beaconsfiald leases up to Murray creek, as the second company.

Will these be two large compuni* s ? — No, not very. But they will have sufficient working capital for the development of their resources.

Will -the company give New Zealand an opportunity of subscribing the working capital for the new companies P — Yes, of a part. Rut as the shareholders in the Consolidated Goldfields Company of New Zealand mmb get an opportunity of taking portions of the working capital, and as I wish to give my ' South African and European friends an interest in these companies, therefore there will be very little left for subscription in New Zealand. Bat at the same time I should like you to know that I am reserving for old shareholders of the Progr-ess, Globe, and Wealth of Nations Companies about 70,000 shares at 20s.

Seventy thousand shares ! • That is a large quantity. Do you think they will be taken up ?— Yea, for they are to be guaran'eed to them by the Bank of New Zealand and National Bank of New Zealand on my behalf for a certain period at 20a per share, and I shall only be too glad to retain those share 3 that are not taken up. That is certainly good business for old shareholders ? — Yes ; and I want them to reap the benefits of the fresh developments of their own properties which I bought from them for cash.

Does the company intend taking up any further properties ?— I can't say that just at present. With such strong shareholders as the company has you ought to extend your operations ?— Yes, that is true ; but you do not realise that capital is only available after capitalists have satisfied themselves that the industry is sound in every detail. For the present it is our aim and duty to make a success of our undertakings, but at th 9 same time I assure you, should anything really promising be offered, it will certainly have onr consideration, and when our engineers can be spared they will thoroughly examine it. You have told me that you are going to form two companies immediately. Do you expect thesa shares to go to a high price ?— Well, I expect they will ; but I wii-h you clearly to understand that oar engineers are engaged for the sole purpose of managing mines and not markets, and my duty is to look after the industry only, and therefore I wish you to know that we shall not be rnnning up shares to high prices or keeping them down below their value. At the sime time I must tell you when British aud fore'ga capitaliots learn that the ( mines have a gocd working capital, big reserves of ore in the mines, and are well managed, there is no knowing at what price they may buy these shares. Who will have the management of these mines? — Mr Philip L. Foster, an eminent American engineer, will be the responsible and consulting ergineer. His well-known ability in all matters appertaining to mining is sufficient guarantee that the properties will bs worked on the soundest and most scientifis principles.

This gentleman is no doubt receiving ■ handsome salary ?— Yeo, I believe he will be one of tbe best paid officials in Australasia.

You have not yet told me how yon intend to deal with the rest of the mineß P— That ia . certainly a large question, but if you think it ' may interest the public I will give you a roagh outline of the proposed development of these properties. Thank you. It would certainly interest all those who desire to see the mining industry developed.— Very weil. The Humphrey* Golly and its > four adjoining leaser, of 100 acres each and all water grants, will be reported upon by Mr P. L. Foster and his colleagues, eminent American hydraulic engineers, On their being thoroughly satisfied, sufficient capital will be sup< plied. The Welcome United Company has probably already been formed in Europe, as £15,000 cash working capital was left with the Rothschild's Exploration Company before I left London. The Fiery Cross, Seddon, and Cadman miuep, which have been proved to contain rich reefs and have already paid such enormous dividends, will ba developed to further depths. In the Roseoery and Caledonian properties a main shaft will ba suok ob the banks of Larry's creek to cut the rich reefs which are known to lie under the river bed. Up to the present time, from one of the reefs 2080oz, valued at £6060, from 566 tons of ore have been obtained. The Salisbury, New Low Level Tunnel, Royal and Golden Fleece will all be thoroughly developed, and I have hopes they will prove hi their deep levels to be as rich and pay as Urge dividends as they have in the past from tho surface workings, and will prove ai valuable aa any of the best mines in South Africa. All the other leases will be of course thoroughly prospected and proved. Are you not going to develop tho Humphrey's Gully properties at once P — Well, I do not say that we are not disposed to take up Humphrey's Gully, but as we represent shareholders we must take every precaution before incurring any heavy outlay. Thorefore we will only arrange the working capital against good reports. What power do you intend to use in tho mines ?— We shall use electricity, steam, and watsr power. The ele.ctcic plant will ba worked by water power, enabling us to convey the electric force to any desired spot. Steam we c*u obtain cheaply, as cos.l is abundant, and we are interested in sonoe of the collieries. We caa obtain the b?st coal, delivered al some of the mine', for 3i per ton. Water pt«wer we can obtain from, certain river* running through our proportion ; as much aa 1000 h.p. for a Very small outlay. I suppose you will be employing a great number of hands ? — Yes ; I hope we shall have not less than 1000 employed very shortly, and as time goes o» a much larger number, as oar lirge mining fivld», wbich aggregate ov«r 2500 acras, apart from larga prospecting area", amounting to over seven square miles, will absorb as many good baud* as wo can obtain. What machinery have you bought at present P — We have already bought several hoisting plants, and a large number of air drill compressors, &c. Do you intend to erect large mills immediately?—No; not for the present. Our first mills will not exceed 80 stampers iv any one station. As soon as our loded aro more developed tbe crmhingf plants will be increased.

Do you intend to avail yourself of the Government sub*idies provided by statute for developing deep levels P — No ; at snyrate we shall wait and sea how the Government treats as and proti C a our enterprise. Although we are already entitled to grant in aid, we do^ nob intend to rely on subsidies or outside help, 9.8 we sball never take up any industries that cannot support; themselves, and give sufficient remuneration for the capital inv> sted. Well, Mr Zitnan, can you inform me what is known of the West Coast of the S-mfch Island as a gold producing field in Europe, and what it the opinion of the British investing pu lie on our mining laws and Government ? — My time was too much occupied to make inquiries on these matters, but I can quote from my friend Mr H. M. C»ddell, BS.-and F.GS., vicepresident of the Mining Institute of Scotland, from a piper he read before (be Institution of Mining Eugieeera last December, iv which he states that the gold oE the IWfton mines is exceptionally pure, and worth £4 Is 6d per ouuc, and fc'.a^ it is a remarkable circntnftUnce that although some of these mines have been 100 or 200 feet below rea level so little watec has been met with »s to render the use of pumping machinery unnecessary. Another advantage enjoyed at Reefton is sn abundance of good and cheap coal from the neighbouring collieries, while the mountains s are covered with timber, and water power from the heights is easily available,- H'thorto the Reefton districts have been practically unknown in Great Britain, and the various mines have been work* d with local capital in. the old-fashioned wasteful way. A«?ays hid proved that fully half the gold had been lost in tbe tailing* during the 15 yearo the mines have be-m in operation. Notwithstanding this waite, however, tbe Reefton mines have produced altogether from 503,000 tons of quartz about 467,000.z of gold, valued at £1,824,000. from which dividends to the amount of £574,000 have been declared by the different companies. Therefore it is cleirly wise on the part of the Government to continue their present policy, and carry out^the valuable suggestions of Me H. A. Gordon, inspecting engineer of mines. Large mining area and securest form of tenure should be granted to those who provide the means of developing them, while the labour condition* should be made as light as possible ; and, in short, no opportunity should bo rejected of fostering private enterprise in gold-pro-ducing, as it is clearly impracticable for any Government to undertake the risk. of carrying on such a large industry as gold mining with any probability of direct advantage to the public J exchequer. Happily the present Government seems fully alive to the best interests of the colony in this direction, and if its policy is steadily adhered to the benefit'would very soon become apparent. The dawn of brighter days is appearing, and it showed that the future will fulfil promises that are now so clearly hold forth. • ;, Notes from Reefton. (From Our Own Correspondent.) Rkefton, March 31. Owing to the disaster at Brunner little was done last week, and this must be my excuse for not sending you what little news there is. The Matakitaki dredge sank in the late heavy floods, which have done very much damage. The return from the Big River, Reefton, fa 2910z amalgam from 91 tons. Mr Ziman reached Sydney on Saturday, and is expected here about the end of next week. The Buller and Cocksparrow dredges could not work, but managed to ride out the flood. April Si Returns.— Big River, 480oz amalgam from 9? tons (clean up for the month); Wealth of Nation** 41oz 15dwt gold (clean up for the month). Mid-day Quotations.— Big River, 21s to 223 j Buller dredge, 5s 6d to 6s ; Cocksparrow dredge,' 3a to 3s 3d; Cumberland, 3s 9dto4s; Exchange, la 3d to Is 6d; Dillon, Is 2d to Is id : Hercules, 3s to 3s 3d ; Keepit-Dark, 31s 6d to 33s ; Golfoa

- jEfead, Is to la 2d ; Ing Wood, Is Ed to la 0d t ty ell. Creak, ife 9d to 4s ; Lord Edward, &6d to ,2a 9d ; No. 2. South Dark, 2a 3d to 2s 6d: Sir *- Charles Rri&sell, Is 4d to Is 8d : Success (cum allotment), Is 3d to Is 6d ; Alpine, 16s 6d to 265 ; 'Welcome, Ss to Ss 3d. Owing to. damage to the road, <Sc, by the late floods, bo coal can be supplied to the Buller dredge, and no work has been done beyond effectfag some necessary repairs cince the flood. The Big River mine is reported to be looking rejmarkably well. The winze in the low level is all in solid stose, with no appearance of either wall, and there is a good show of stone in all the stepea fcbove. Mr I>. Ziman ia expected heradurlngaext week. Notes from If ell. _ „ _, , ' ' Lyell, April 4. Xyell Creek.— The mine manager reports :— There is nothing further to report from the mine. Owing; to the extreme hardness of the ree! the. winze has only been aunt 7ft t making the total dißtancfr 64ft. There is no change as to the quality «f the stone. j