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Oreatford Station to Wanganui (37 miles 4 chains). —In this section the portion included in the Wanganui Town branch contract, 2 miles 71 chains, was opened for traffic on 24th January, 1878 ; and the Marton contract, 13 miles 67 chains, was opened on 20th May, 1878. Rangitiltei Bridge. —This contract was completed on the 25th July, 1877. It consists of nine spans of 60 feet each, resting on piled piers, and is well and substantially quilt. The piers, which are, of timber, have been protected against scour by depositing around them heavy concrete blocks : this has heen done with complete success. Surveys — Bunnythorpe towards Manawatw Gorge. —Pour miles of this section have been pegged out on an approved line, beyond which 3i miles to the Gorge, and 4| miles through it, are yet unfinished, as it is not yet decided on which side of the Manawatu Eiver the line will be laid out. North of Wanganui (Brunswick and Kai-iwi Contracts, together 9 miles 34 chains from Aramoho Junction). —The formation only of this length is finished, but tenders will shortly be called for the plate-laying and other works not yet completed. Waitotara Contract (12 miles 71 chains, ending at a point a short distance north of the Waitotara Eiver). —This work, which includes formation and plate-laying, has lately been let. The contract time will end December sth, 1879. Surveys. —The field-work for the land plans of the Kai-iwi and Waitotara sections is completed, and the plans are now in course of preparation. A trial line of the extension of the railway to Waverley (Wairoa) was begun on Ist June. Waitara-Patea Eailway. Waitara-New Plymouth. —On this line the truss bridges have been painted, and about 100 chains of fencing erected. About 2J miles of the line are yet unfenced. Waiongona Section. —This leaves the above line at Sentry-Hill Station, and is 8 miles 60 chains in length. The plate-laying and ballasting have been completed during the year, and the section was opened for traffic on the 30th November last to Inglewood. Ngatoro Section (8 miles 60 chains to 13 miles 40 chains). —The formation on this section was completed on the 27th May. The masonry and timber culverts have also heen completed by contract; and rails, with fittings and sleepers, are on the ground ready for plate-laying, which will now be proceeded with. Waipuku Section (13 miles 40 chains to 18 miles 60 chains). —On this the bush has been felled 3 chains wide, and the central chain cleared of timber up to 15-g- miles. Formation work also is complete up to 14 miles 40 chains. The masonry and timber culverts have been let by contract, as have also the larger bridges. The works on the last-named sections have mostly been done on the petty-contract system, affording employment to about eighty men living in the vicinity of the line. Stratford Section (18 miles 60 chains to 22 miles 20 chains, terminating at the first crossing of the Patea Eiver). —The bush has been felled as far as the river, and the centre cleared to 20J miles, also by petty contracts. Surveys. —These are now complete up to 13 miles 40 chains. Wellington-Masterton Eailway. The portion of this line between the Upper Hutt and Kaitoke Stations, 7 miles 38 chains, was opened for traffic on the Ist January, 1878. Since then the works on the Mungaroa, Pakuratahi, and Summit contracts have been completed, including the lining of all the tunnels in which the nature of the materials demanded it. The plate-laying on the Incline contract is now being proceeded with by day labour, under the supervision of the officers of the department: this differs from the ordinary plate-laying in having a central rail, and special engines are required to work on it. The Pell engines, imported for this purpose, have been employed on that portion of the line in transporting rails and other material from the summit, and so far their working has been a complete success. The work is being pushed on as rapidly as possible, and it is hoped that the line may be opened to Featherston ahout the middle of September. Featherston Station Contract. —This is now being pushed on satisfactorily, although much time was lost during the first two months by the inefficient arrangements of the contractor. Carterton Contract. —This extends from Featherston to Masterton, a distance of 20 miles 41 chains. The work was let on 6th April, 1878, and includes formation, plate-laying, and buildings. The contract time will expire on 22nd March, 1880. Very little work has yet been done. Surveys. —The preliminary explorations and survey of the proposed Hutt-Waikanae Eailway were begun early in the month of April, and have been carried on uninterruptedly since that time : the explorations have been made to include that portion of the line lying between Waikanae and Poxton. Owing to the wetness and cold of the season, the work has been specially disagreeable, and has been carried on under much disadvantage. Special reports on these surveys are attached to this report, as well as an approximate estimate of the cost of constructing a railway as far as Foxton. A map of the North Island, showing the extensions made in the railway system during the year, is also attached. I have, &c, J. Blackett, The Hon. the Minister for Public Works. Engineer in Charge, North Island.