TARANAKI PETROLEUM COMPANY.

Taranaki Herald, Volume LIV, Issue 13797, 31 October 1908, Page 3

TARANAKI PETROLEUM COMPANY.

ANNUAL MEETING. Tlio second annual mooting of tho Turaiialvi Petroleum Company was held at the Theatre Royal \e?>tenlay alternooii. Air. 1). Berry presided, an<l was supported on ilie plationn l>y Messrs. ('. E. Hellringer, M. .1. ,lones, H. Olvt'y, .1. Little. Murdoch Kraser, ,). M. Hoy (fliivHors). Simpson (man-auj-r) an<J Dohell (secretary). There were about one hundred shareholders present. Mr. Ik-Uringer explained at the outset that Mr. .Berry was unwell, and had request**! him to assist him in the eondurt of the- meeting. CHAIRMAN'S ADDRESS. Mr. Bellringer, on behalf of the chairman, moved the adoption of the report and balance-sheet, reading Mr. Berry's remarks as follows : — ] ialtilities. — The first ite-m is the diminution of uncalled capital from £]/j.SG7 10s fid on 30th September, 1007. 1o £7918 at the same, period this year. Well you will remember that one. call becalm* due just after la*t meeting, and another just before our annual balance this year. You will notice that there, is £1500 in the bank, and £2000 odd of calls in arrears, montly recoverable, so that without, some developments favourable to the Company occur, it is not anticipated that any further call will be required for nine months or even more. But we nhould know what success we are. likely to achieve before that time. A division of the amounts in arrears shows- — First call £22 15s, second call £29, third call £144 5s 4d, and fourth call £1919 15s. A certain number of summons were issued on tho first three calls, while such is not the case with the. fourth, and hence the difference. Since the balance, £350 odd has been received on account of fourth call. Tho item sundry creditors £70 os 5d includes portion of salary due 30th September, 1908, to the manager and secretary, and sundry small accounts. Assets. — On the assets side I wish to point out that the cost of bores given includes the values of derricks, buildings, engines, etc., while movable plant, comes under the head of tools and general plant. The actual wages, fuel, repairs to plant and sundries are as follow : — No. 1 Bore. £ s. d. Wages 152 14 10 Manager's salary ... ... 72 18 4 Sundries — Fuel, repairs to plant, etc. 60 5 5 Total amount during year £280 18 7 No. 2 Bore. £ s. d. Wages 186 19 8 Manager's salary 104 3 4 Sundries — Fuel, repairs to plant, etc. 20 10 3 Total amount during year £311 13 5 No. 3 Bore. £ s. d. Wages 1101 Jl 10, Manager's salary 572 18 4 Sundries — Fuel, repairs to plant, etc. 347 4 11 Total amount during year £2021 13 1 No. 4 Bore. £ s. (1. Sundries — Repairs after gale, etc. ... 15 5 9 No, 5 Bore. £ *, 4. Sundries' " ..':■. \". ...' ,3 16 0 The item of " Freehold property and options, less options unrenewed," it may be explained, was not written off as other options have been offered to your Company, and which may yet prove to be- of at least as much value as those, lost. The deduction firsts, and the subsequent addition as provision for these or further options, were .made-. upon the, auditor's recommendation. Already some of the'imrenewed options have- been again offered to Ihe. Company. Working Account. — This "account needs very little explanation, but one item, that oi law costs £94 2s lOd, looks big, hul £53 odd of this was due to defending a Supreme Court action, brought against us by the New Zealand Times, and which action we really won, saving the Company some £130 approximately. It' has been stated by a writer in a local newspaper that the manager gets £'15 per week. Well,. this is hardly correct. The amount is £14 8s 6d. He, also states that the secretary gets £2po per annum, and a cadet £52. Again this is incorrect. The secretary gets £250, it is true, but out of this he has to pay his own cadet's salary. Again, 1 he says "The position of the Company seems to be that there are fix (G) men employed at a weekly wage of £30, requiring £26 for management and supervision." The facts of the case are that two drillers are employed at £G per week and three men at Ifis per day, and one engineer at £3 10s per week— a total of £24 10s j instead of £36, so that this has been increased by only 50 per cent. In tho face of such inaccuracies as these it is scarcely worth t while going further. The same writer gives the cost of management nml supervision at £8G per tveek with the ssiuie inaccuracies in figures, and 1 have yet to learn thai office expanses ar<» chargeable to suporvißton. However, the total, including rent, telephone and sundries, only niifntmtx to £297 4* 10d for the yo«r, or under i' 6mr week instead of til hs Ktad'd, h din'flrew.n of nearly 100 pur c«>nt. One ntofn <»att«M' that I would point out U that under the CompnnW Aft, HJoil.it is fompulHorv that, si I'l'tflMiM-ed all two 1»t» k«»p<, 1 (^msidcr that tin* to nil i\\»\ need b« »iM«| in tho wrtHtinps nwoniit. llrlnflv, slwreholdtM 1 * are rnmim|«nl that tfiitH \n yet only tt iii'nKpwtititf eofujwny, mid « profit mid Idkn miiHiitt in not, kupt :im ill n purely irttdintf rompitnv, pirwtoiV Ri'iMH'l.— Vorx !•♦ * 1»* - in tin* cull* for w>o«'lu) jpiMitmu, exempt ♦ lit' Tutun> j»olh\y of thr tlitwinw. «ndII hut will 1«< i»«r« fuliy .Ihjill wbh in Uh«i itniutitfoK'tf ropoi't, whjoh will lut road to ,V>«l, nml he will hlno npmuU upon Him NtihJAit. KkHioH of nireetorp.— Two of your directors, vise.. Messrs. Murdoch Fnmer mikl C. K. IMlHnjror rtt'irc by rotation, and being eligible again offer t heir KcrviccH. Auditors. -^-Ttvo auditors will also r<»<|iiir« to bo elected far iho oiisuinn; v«*ar, miml their remuneration fixed Mt. Hwnh Ji-n\y ami Mr. Herbert I owi«. the auditor* rotirif g. are botii eligibli' for re-oWtion. r4nd again ion- !<•»• their wrviifti, l»ur 1 am urepaied \o rujrfpt «>th«r nomination*; if «o do<mvd. M not inp*. — The directors liavo iru>t 44 times in formal meeting during the \eiir. besides many informal meeting* il <lif)V>'on* tlmo-J ajld phire*-. Air. V. <"iriff^hs *eroprW the morion ffv the arlo]>tion of the report :|i<l l>:l' ilfc-sbeel . \fr. .1 J. Klwin s:iid there apnenred |t.» liim to lu:ve btcn a jn-eat denl oi

matter that might have been given in the balance-sheet, and some that was given that was liable to cause shareholders to have the idea thai the directors or the Company were noi working as economically as might b"e. In the first place £21,688 had been received sinco the Company was fii-ht formed, except overdue calls or calls in arrenr, which had to be deducted Irom the amount. Against this they had expended £21,>')62, with the exception of the balance which was now in the hands of the bank. He asked had the Company obtained any freehold property and options since the present Company was formed, or were they the same as those they took o\er Irom the old one? Mr. Bellringer said the options were the same as those recently taken over. • .Mr. FJwin said the item working e\penses appeared on the face of it to be singularly large.^ This year the office expenses, which he presumed included legal expenses, amounted to £151, and the cost of carrying on the office and working the company after deducting rent of options, royalties, and -the proportion of preliminary expenses was £669, which he worked out to bo between twenty-one and twenty-two per cent, ol the whole of the money expended by the Company. Then they had the siceount of the work that had been done on the bores. He found that the actual working had cost £2208, which included the manager's salary. They had bought £303 worth of casing, and at the present moment they appeared to have over £2300 worth of casing somewhere. Was this fit for use, and was there a stock book kept in which the quantity of casing, the tools and so on on hand were scheduled, or wore they allowed to lie about the premises haphazard? Mr. Bellringer: a stock list is kept of the whole of the plant at the different bores, ami everything can he traced without any trouble. The directors know where everything is. IWr. J<;twm asked if it was necessary to buy this additional casing Mr. Bellringer: It was necessary to obtain certain sizes that vrorc not in stock. Mr. El win asked »why £574 had been expended for tools, wheiv £229 worth were now in hand. . Was there any special work which required £500 worth of tools to be bought ? Mi\ Bellringer said the amount was chiefly swallowed up by the cost of ■a new engine. Mr Elwin : How many engines have we at the present time? Mr. Bellringer: Four. Mr. Elwin said to him it hardly appeared necessary to have purchased another engine, seeing that work had only been proceeding at one or two bores. Mr. Bellringer said the engine was ordered before the number of bores was reduced. It was ordered before the last annual meeting. Mr. Elwin then drew attention to an item of £36 for site and surveys. Mr. Bellringer said the Company had obtained the lease of a piece of land which was eminently suited for the purpose «f a refinery. Even as an investment it was o, good thing for the Company, and the shareholders would have no ea,uso to regret having acquired it. Mr. . Elwin said during the year £3202 had been the whole of the money spent by the Company on work and plant, and tjhey had kept up an office at a cost of £699. N,ot many businesses or companies could be carried on on those lines. Then, coming to the question of the manager's safary, they wejfr told the manager was' engaged for ( two years'' at £750 a' year. 'Cher?'" was^o ..jflffiibt the manager was "under k a' iuisppnr.ehension w*h'mi he cawfe: here, -a^ut;!alsp, the director w^ien tfiey eiigages,,hiin. Things hafl not,,^urned. out ,^s <an-. ticipated, ,and instead of having four or live, bores to supervise, the manager iad ] only had the supervision of one. During the year the manager ;inust certainly have had a very great amount of spare time. He could not possibly be required to be constantly at work or supervising the one bore. Ho would ask, in the meantime, had anything been done with a view to utilising his services for tho benefit of the Company' during the' coming year? ' Mr. Bellringer said Iho manager had been engaged solely' in the work of the Company 'during' the .year. Mr. EJwin said the manager was engaged to supervise" five bores and had only had "one. ' "How could his time have been taken' up. Mr. Bellringer said work of an e\Iremely delicate nature had been in hand — tho shutting off of the water — and Mr. Simpson had devoted the whole of his time t<vi4t*< Mr. Elwin: And with any Mieeess? Mr. Bellringer: -No. .2 speaks ior that. Mr. Elwin submitted again that the cost of supervising - and the cost of management w^re 1 out of all proportion to the results obtained. r The shais. holders were' told last year that No. 2 was practically a dry bore, hut since then comparatively very little had been spent on: it. It was only just before the issue of the balance-sheet that work at the bore was suddenly resumed, and up came the oil. He would like to ask whether the manager had suggested that 'by doing a little work at No. 2 they might get something appi'eeiable out of it? How was it that work on No. 2 boro had heen delayed? Mr. Bellringer »iiid tho ' manager would explain thin. Mr. Klwin said ; tber« had been a ptuniliar secrecy tmrrnumlhiK thwwork of the ■ Company, and shareholder* in this town mjhl ulho ut a distance wcr* Only ahlo to surmi«« whut wbk being dono. Ho did not wish to imply thnt ghuiKtholdoi"* had nny doubt as io the direntprV working ift thttir interests and ho on, but' ho. thought in a proi* iiwtlnn company h» tnU whk t)w more line wun known uhmic tho work tho bettor. Thwo tmjgnt b© tim« tuul ren«oim whe.ro it wh,n W>il not to upo the knowlmjgo tho dirwtorit ami tho mini* np*r might hove, but Hharo.hnldfM'H inviwtiiifc tlwir tunwy— mutt mmiy ol them poor people for whom it was Imt'd to wrftpo up tlw calU— mlujlit \x,vt it litH»* «imouf«K*m«Mt from üm« to tjnto »k to lh« ihMjmxusl (\\f titoir getting: miyrhmg P»ph, Dmlug ib" wh'tlrt your the only tallc tnov could he»«r wn» tliHt If Bhnr«H would only uu up to 10ri thoy would still thwn and trtlso eui'« not to invost anything moro in' ntrtroletun. Thw was not a proper! fool inu; in regard to a work of Mich matrnitude. Mr Elwin on behalf of another shareholder aitked if it was n fact that eml»loy»w»m of tho Company had been threatened with instant diHinissal if they mentioned petroloiim. outwido the works'. Mr Bellringer s«jd nothing of that kind was* done. Th<«r« was v timo when *t was considered to he in th© interests of the Company that certain information should not 1m carried outside unfit it -was proved. The desire of the 'liiectont was that all information given to the public should be authentic. Mr Elwin : Wore the men given letters thr«»Htening them with instant dismissal if Iliey divulged anything? i Mr Bellringer . Letters were sen! to!

them telling them that tlie business of the Company was not to be talked about the streets of the town. The motion was then carried. MAN Aft KU'K RBPOttT. Mr Bellringer presented the manager's rflport as. follows : — - Gentlemen. — In submitting my usual annual report of the work done at the bores 1 beg to say as follows: — No. J Bore.- — I continued work at this bore only from the date of my last report about tbe »*nd of October, 1907, until November 28th ,0!" the. same year. 1 struck a hea"vy flow oi gas at 2321 feet, which caused the water and silt to gush over the roadway, making it necessary for us to close dow v until the derrick was closed in. When we resumed operations 1 found the casing fast, and as there was already a length of s in casing lost in the hole, prior to my arrival, if tho casing should have to be removed 11 would bo -an expensive well to complete, so 1 advised the shutting down of the well until the other wells were completed. No. 2 Bore. — This bore on November 7 last, was shut down at a depth of 2188 feet .and remained untouched until August 24, since which time ' the casing has been withdrawn, perforated, aad replaced in the well, which was re-drilled and cleaned out to a depth ' of 2214 feet. The upper water is still shut off, but some little. salt water is coining from below where the upper water is shut off. At the present time tbe bore is down 2214 feet, and from the 19th, to the 26th inst. has produced about 2200 gallons of pure oil, besides some 500 gallons discarded whilst cleaning out the silt. Tbe well is now filled with oil to within 31)0 foot' of the top. Operations have been suspended for two days owing to the annual inspection of boilers. I recommend that tbe cleaning out and testing of No. 2 bo continued, until such time as w-e have ascertained the daily production, and then if practicable, the bore be sunk down to the depth where we obtained - the heavy flow of gas and oil in No.l. No. 3 Bore. — The work at this bore for the year consists principally of put- - ting in Bin casing from 1589 feet, where it was to 2300 feet, reaming the hole larger for same, with the hope of shutting off the upper water with , this laTge casing, but without success. Also working and lowering the Gin! casing, and pulling it all out on sev- , eral occasions, in the endeavour to abjut off water with this casing. The <lep^rh J drilled at first was 11G feet, but this by ; no means represents the amount <tt \ drilling done, as it was necessary ; many \ times to withdraw the casing, thus al- j lowing the well to cave in, necessitat- ( ing the re-drilling of, in many cases, ] 400 feet to 700 feet over again, and this was practically the same airtpunt ' of labour as at first. When the fric-U tion on the casing became too great to handle it I had to draw the 6in drill and ream the well from I§B9, feet to 2300 feet, and - then coptjnue. with this size down to its present depth, testing, pulling, and re-pulling. , The wal;er is not yet shut off^ but while it has not been completely dry, it has been nearly so on several occasions. I would not recommend , t\ie sinking of this bore any deeper/ until the water, is absolutely shut off .— I Am, Gentlemen, yours faithfully x W. , >■&. J3impson..j Mr Sinipson said he did not know that he had many remarks to make in addition to the report already read. He knew there had been qxiite si, lot of talk about the bores and himself but as was . usually • the case those people knew least about it that made the greatest sbng^ It had been asked what course the directors had taken to keep k him employed whilst one or two of the , wells ,had "been shut down v IJe, did not cQme. h^Tfi. to take liold of the pick . and shovel or u if -the Company chose "to $hu,t down one of its wells and discharge one of the scaffoldmen to take hi&^plaee. .His time had been fully occupied. It wasy said No. 3 bore had cost an .immense amount of money. Ii) had cost £4000, a mere bagatelle, arid if they looked the world over, they would find in comparison that it Wai • very sn|all. , To hear people talk he had been accused of almost- every crime in the colony and tried before a judge and jury, and brought there for his execution. .. He had, however, "a glorious hpme to go to when the people liere got fired of him. Something had b^en said, he /understood, as to whether he woukUbe re-engaged or not at the end of the two years, but another thing they. had to consider was whether tney could get him or not. Mr Simpson proceeding, traced the work .that nad been accomplished lit the respective bores '„ since he took charge and explained 'the ' difficulties he had had to contend with through no fault of his own. By the methods under which they •were proceeding^ when he came here 1 they'wlpre fast being driven .on to the rocks of bankruptcy and would have been there long ere this. They talked about his salary — the little screw he was- getv ting — but. if they were not- .satisfied > with his services- let them gtt' to work ' and dispense with his services and get somebody else whom they could trust, and had the ability tp put these^ wells down rtiore satisfactory than he could. He had been engaged in putting down gas and oil wells in 0 great iriany places and a little bit of clap-trap he neard did not bother him. He utterly repudiated any responsibility for the extra expense, incurred, in No. 3 well as this well contained tools left in the well at 1050 fee* during Mr. "Mathners one?j'tiona. When he took charg© on JtU}» - 3rd ho wa4 Informed tho w*H wtea dr.v, but found it wiis not, He, ordered h'ia men to take the Bin. easing out and continue. 0 iwh,, when ho w»k infQrmecl that they had been months drilling by . the nimtiMiction in thil well ftt about J,})<so feet, and it 1 they pulled th© caning out tho enH!iw»B were ti'ey cmiW tint get it Iwiok. Me thru eon tinned tht I Ificfc enying down to 9234 f»>«»t. O" *in»mt ; 24. he. jmmpi'tl the well out JSOO,f,W*J *itli, pumped, well dry; Bfltn, drijlfa SKI feet of renniingd. wffl still Ory 1 »7th, ilpillfd S font, wll still dry, mukitttf dtnUh of «*»U $m f*^t, \v!wn thy.v Jiwt h pK»ne of H inch pump m thu <vol| throufrlutho brenking oi the Uwvtr huh; > flOth, fluhing for pi pen of pump; Ht>n* tfliHbpv 9, ruisGUl piece. «»P pump into ohhl.uk NyiitM*^ it biMt(tm<t fa«i; , lifted 0 " ifjrb i<ipiin^ two TiMtifthrt; Jh'tj, recovered u'nwu of- numii hiul put (I inch caninj? bue.li Into tt*i neat, pnmpod W<'H dowu 1/500 IWi; tith. well not dry, l«Voro thin date to lh* early pnrt w November they reamod and tested for water until he became * »nti»f iod there watt something Wrong .with casing, and decided to pull it; pulled casing mid found hole in easing .caused by ffehingtoo). During this time he had gone through all the hardest rork they had in the well. Had it not been for the obstruction h« would have pulled tho casing shortly after he found tht» yi&ter wi» not shut off. They were over a month dnllrng, reaniinjr. and lowering thevfote to where it bad lifted from. Since theu the rock had not been of such a nature as to enable him to shut off the water, although nearly so on several occasion*. No. 1 well was in the same condition with casing and tubing at 2214 feet. Tho only well that w»s not through the oil strata "from which we are now pumping oil :was No. 2. nnd that one is in better -hape to day than any of the others.

~S\v Jiayly asked if Air Simpson could • give the^sh-svrelto-lders a-ny idea us to the prospects of No. 2 bore. Mr Simpson said the bore Mas in fairly good shape for going down to the vein which they expected to get at 2340 some odd feet and if they could ' control the soft formation which lay immediately in the vicinity of the oil streak they now had then he thought Die two together ought to make v fairly productive well provided the oil was in the second vein in the proportion ho should think it Mas from the gas ih«y had got out of .Xo. 1 at that depth. .vlr Elwin said the manager seemed to have been singularly unfortunate in Unit he had had to tackle work begun by somebody else. He asked if the company had sufficient money to go on with No. ."> bore. If Mr Simpson put it down in his own way probably there would boa different result. Mr Hellringer said the company had £12.000, roughly. This of course was a question of policy for tho new directors to consider. Mr Elwin asked, if Mr Simpson could give any idea as to the likely cost of putting down the bore. Mr Simpson said it was impossible to tell until the bore was complete. Mr Elwin asked if the manager could give them any idea as to whether it would be desirable to go down in that well. Mr Simpson: I never prognosticate. I can't see under trhe ground. Mr Elwin mentioned that the late manager, Mr Fair, always considered there were better prospects at this bore than any of the others. ' , Mr Bewley considered it would l>e^ foolish to spend money % on another bore. Let No. 2 be thoroughly tested first. Mr Schnackenberg moved a heartyvote of thanks, to the directors for their services during the past year, and that they be voted an honorarium of £200. Mr Steeds seconded. Mr Elwin moved as an amendment ' .that the directors be ,voted £100. This was seconded. Mr Bewley supported the motion, which was eventually carried by 44 votes to 13. , Three- nominations- were received forthe directorate, Messrs C. E. Bellringer and M. Fraser (retiring) and J. J. Elwin. The ballot resulted as follows: — C. E. Bellringer 824 votes, J. J. Elwin * 229 votes, M. Fraser 845 votes. The re- ? tiring directors were duly declared re- , elected. ; Messrs Hugh Baily and H. Lewis (rei tiring) and C, T. Mills were- nominated *tor auditors. Messrs Baily and Mills {were' elected. I : On the motion of Mr Elwin, seconded ' Iby Mr Griffiths, a vote of thanks was i accorded Mr Simpson, and an expression of confidence in his management. f- Mr Simpson, ip response, said he hadgiven the wells as much attention as ithough he had owned them or had a contract to put them down, and had also been economical in every respect, cutting down expenses wherever he thought it had been in the interests t>f , t^p^cooipanytir dO sd."