LANKEY'S CREEK GOLD MINING COMPANY.

Inangahua Times, Volume VIII, Issue 1293, 5 September 1883, Page 2

LANKEY'S CREEK GOLD MINING COMPANY.

(Olago Times.) A special meeting of the shareholders in the above-mentioned Company was held at Watson's Hotel on Monday, Mr W. Watson in the chair. The following circular, issued by the manager at Reef ton, was placed before the meeting : — To the Shareholders. Gentlemen, — I am instructed by the Directors to inform'' you that the result of the crushing of 680 tons of cement, taken unpicked, is 72ozs £sdwts melted gold, the yield being about 2|dwts to the ton ; and that the liability of the Company at this date, after theftpayment of all calls (including the^ft^jMth call, due July 11), is £886 17s lid, consequently three calls of 3d per share will have to be made to cover liabilities. ,; At a meeting Directors held on the 25th inst. it was decided to mark ofFsections of the mine and let them on tribute, tributors paying a percentage on the gross yield, and the Company crushing for them on terms to be arranged. Specifications are being drafted, and tenders will be invited with as little delay as possible. In the meantime a few hands will be employed taking out the lower cement, and when a sufficient quantity is paddocked, it will be run down and put through the battery. As soon as the liabilities of the Company are met, the Directors intend opening up their coal mine to supply the district, the coal being of first-class quality with an unlimited supply. They calculate, with an expenditure of £300 to cover cost of aerial line to connect mine with dray road, together with rollingstock—they will be able to secure a certain source of profit to the Company. I am ect., W. Hindmarsh, Manager. Reefton, July 26, 1883. .The Chairman said that, as they were aware, the meeting had been called at the request of shareholders, in consequence of the unsatisfactory state of the Company's affairs on the Coast. No doubt those present would like to be informed as to the precise condition of matters, but the fact was that the Dunedin directors knew no more than they themselves did. One solitary trial seemed to have been made of the cement, and then the whole affair had collapsed, after the shareholders had spent something like £6000. He had some telegrams from the Coast to read to the meeting, which would place*,them in possession of as much ; information as he had. All the Reefton seemed to do was to asji.'them \ continually for money, without proposing any action. The first telegrams' ii'e would read were as follows =:-Uii ' . Beef ton, July 2 £; — Directors decided to keep on & 'few- miners to prospect Laukey's ground -and take out lower cement. : . Reefton, July 25. — Directors have decided letting mine in sections on tribute. Tenders will be invite"d as soon as specifications are prepared." " Reefton, August 6 — Have you had meeting of Company, and what was the result ?" "Reefton, August 8. — Reports, &c, were posted on July 27. If meeting falls through, please advise directors on matter of working cement and coal." " Reefton, August 18— Directors' recommendation forwarded by circular. Work going on in mine. Manager reported on Saturday striking better class cement, equal 7dwt. Company's creditors pressing for payment. Arrange with shareholders to remit immediately outstanding calls, to protect (? prevent) Company going into liquidation. Kindly wire result meetiug." "Reefton, August 13 (later). — Mitchell's acceptance (£B9) dishonored; legal proceedings threatened. P.ease get authority from shareholders at meeting to draw for calls to meet engagements. Sangster's acceptance due 23rd inst" The Chairman said that the above telegrams embodied all the information that was in the hands of the local directors. The balance-sheet showed that £6000 had been spent for no earthly purpose whatever. He had visited the Blue Spur recently, and had found cement of far poorer quality paying dividends. Mr Spedding was sorry that the attendance . was so poor, as he would have liked to he4r a full expression of opinion on the paH of the shareholders. When people embarked in an undertaking of this description it was generally with an expectation of possible gain, but this particular undertaking had been put before them as a certainty. Gentlemen had given them full and complete assurances that gold was there, and that the mine must turn out a rich one. They had told them of the results of washing under their own personal inspection, and samples had even been sent down, taken promiscuously from the face of the cement, which had yielded something like 302 to the ton. This, of course, led to some excitemf nt. These gentlemen were trusted from the position they held, &c., and shares rose rapidly from Is 6d to about 9s or 10s. Expensive machinery was purchased, and everything was done merely on the strength of the reports received from time to time. The first suspicion here was aroused by the fact of a gentleman of experience, who was sent to

the Coast for the purpose, giving the 1 shareholders no report. His report appeared to have been smothered, and ' what he had said the speaker had never to this day been able to discover. But from that time the excitement stopped, and shares began to retrograde. Then, even for some time after the crushing there was no report, but before the directors and shareholders here were aware of anything, someone must have known that the mine was not going to pay, because the shares dropped to Is before those in Dunedin understood at all that it was a failure. Now all this looked like nothing else than a premeditated swindle. If the report before them were true, the speaker did not think that any such thorough swindle as the Laukey Creek Gold-mining Company had been heard of for some time. (Mr Spedding here indulged in some very strong remarks with reference to the management of the mine in the past.) He for one would not be willing to give the mine up, but thought they should put a thoroughly practical man there, and let it be worked under his direction for one month. It would be time then to . decide whether they should go in liquidation, or manage the affair in a different way. He would recommend, of course, that the calls should be paid up in order to enable them to do this, and would move the following resolution : — " That before steps be taken to mark off or let on tribute any portion of the mine, or before considering the desira bility of opening up the coal-mine on lease at a contemplated expenditure of £300, the mine be further tested under the entire direction and supervision of an experienced mining engineer, and crushing continued for one month ; the result of such crushing to be telegraphed to the directors of the Company here, so that they may further consult with the shareholders." Mr Kennedy thought the first thing they did should be to ask the Reefton' directors to resign. The Chairman remarked that he himself was resolved not to act any longer upon the directory of any Reefton companies. He might remark that during the time of the erection of this machinery the Duuedin directors had of course wired that the expense was too heavy, and he knew as a fact that Messrs Kincaid and Co. could have erected it as good or better for just one-half the cost. The Reefton directors had instead sent a man to Auckland to buy second hand machinery, and seemed to have wished to send money as hard as ever they could. Mr Elder was of opinion that the shareholders here shou d have an independent report for themselves. They had already spent £6000, and it would be very bad policy to throw it away without throwing a few more hundreds after it. He would second Mr Spedding's motion. After some further discussion the motion was unanimously carried, and a recommendation, was added that past due calls be paid up. The .Chairman, Messrs Elder Spedding, and Gregg were appointed to take the necessary ' steps to give effect to the resolution.