27

a—3

In the South there was an increased yield of gold in the following counties, as follows: Marlborough, 1,2620z. ; Waimea, 187oz.; Collingwood, 1,9930z.; Inangahua, 11,7150z.; Grey, 6430z.; Taieri, 2450z.; Tuapeka, 3,8570z.; Vincent, 5,7080z.; Maniototo, 1270z.; Waikouaiti, 2040z.; Waihemo, 5590z.; Waitaki, 14oz. ; Bruce, 5140z.; Wallace, 2,0140z.; Southland, 1,0770z.; and Clutha, 20oz. While last year there was a decrease in the yield of gold from the following counties : Buller, 5,5750z.; Westland, 2,0770z.; Lake, 1,5250z.; and Fiord, 2540z. The largest increased yield for the past year being in Coromandel County, while the greatest decrease was in the Buller County. It is gratifying to find that the gold-mining industry is attracting the attention of men looking for investments, and that the increased returns show that investment of capital in mining ventures in the colony is justifiable, and that, with proper development, and improved appliances for the reduction and treatment of ores, many mining properties which formerly could not be worked successfully can be now worked at a handsome profit. The cyanide process of treatment, notwithstanding the large royalty charged by the Cassel Company for using it, has been the means of causing a revolution in quartz-mining, while hydraulic elevating and dredging has ushered in a new era in working alluvial deposits. The gold in the North Island is confined, as far as yet discovered, to quartz lodes, while the gold in the South Island is found in both quartz lodes and alluvial deposits, and in many places on the West Coast and in Otago there are large areas covered with great depths of auriferous drift, which will take some generations to work out, even if a plentiful supply of water were available. QUARTZ-MINING. In making my report on quartz-mining in the colony during the past year, it may be mentioned that a large boom in the mining industry has taken place, and there is a great demand for mining properties ; indeed, being such that people are pegging-off claims with the view of disposing of them to foreign capitalists, without doing any actual work, simply getting a grant of a special claim. The present boom is the largest that ever has taken place in the colony. It commenced in the North Island district, owing to large returns of gold being obtained from the Hauraki Mine at Coromandel, and the Waihi Mine at Waihi, in the Ohinemuri district. Special claims and licensed holdings have been pegged-off in all directions. Mining engineers have sprung into existence like mushrooms, and some of them have been busily engaged in reporting on properties, showing their values in such glowing terms that people residing at a distance have great difficulty in deciding what is legitimate mining enterprise and what is not. The boom extended to the West Coast, and claims are now being taken up on ground which twelve months ago was looked on as utterly valueless, and high prices are asked for the properties. Nevertheless, although we want foreign capital to develop the quartz-raining industry, it is essential that nothing but legitimate mining enterprises be offered to capitalists in order that they may receive a fair interest on their outlay. If worthless properties are placed on the London market and taken up it will tend to bring. about a depression in mining, and it will take a long time to re-establish confidence. All those who are interested in the welfare of the colony should set their face against offering valueless properties to foreign capitalists. The Hauraki Peninsula is a large field for quartz-mining; it extends from Cape Colville to near Puriri, and the same belt of country continues still further southward. The formation of the rocks is highly indicative of gold- and silver-bearing lodes, and new discoveries have recently been made in the Tairua and Whangamata districts which go to show that valuable auriferous lodes exist, and those places which are only now held for the timber they afford will soon be opened up when capital is forthcoming to develop the mineral resources. Already several persons have netted considerable sums in taking up outside claims, and they no sooner dispose of one than they are on the outlook for another, and contesting as to who will be the first to get pegs in. Ground has been pegged by parties after others have been on similar errands, and shares sold in anticipation of claims being granted, and when their applications came to be investigated they had no standing. Seeing that claims are taken up in this manner, and no work done to prove whether there is a likelihood of payable auriferous lodes existing or not, it cannot be wondered at if failures take place in investing capital m such ventures. On the other hand, there are many legitimate enterprises offering; and even some of those claims which are taken up simply for the purpose of floating companies to work them may turn out to be profitable investments; but there are many chances against this taking place. When one can see such large lodes as in the Waitekauri Company's, the Waihi Company's, and the Waihi-Silverton Company's mines, which a few years ago were looked on as being of little or no value, and other large lodes in the neighbourhood which are known to contain a little gold but have never been properly prospected, it holds out a great inducement to expend a reasonable amount of money to carry on prospecting operations to test those lodes at a greater depth. There are also large lodes in the Karangahake and Waiorongomai fields known to contain rich auriferous and argentiferous ore, but of a highly refractory nature, on account of having other base metals in the ore which cannot at the present time be separated unless at a great cost. Some of those lodes contain gold-, silver-, copper-, zinc-, lead-, antimony-, and quicksilver-ore. To separate these base metals by some simple and effective method has up to the present not been discovered. Very refractory ore is found at the Waiomo, in the Monowai Claim, also at Tararu, in the Norfolk and other claims ; and a few years ago a large concentrating plant was erected by the Sylvia Company to concentrate ores of this character and treat the concentrates by the cyanide process, which proved a failure. On my last visit to this district and the place where the Sylvia plant was erected there was a large accumulation of these concentrates stacked on the ground after having been operated upon by the cyanide treatment, and Mr. Park, Director of the Thames School of Mines, who accompanied me, stated that he had recovered bullion from this heap of waste material having an average value of £5 per ton. 6—C. 3.