£1,000,000 Co. For Oil Search In

Papua And Hew Guinea

Enormous Finance and Scientific Skill for Continuance of Enterprise

THE formation of Australasian Petro leum Co. Pty. Ltd., to take over the New Guinea and Papua interests of Oil Search Ltd., has an international sig nificance.

The nature of the development—which was forecast in recent issues of the “P.i.M.’ —has been very fully described in the Australian newspapers of October 18 and the following days. Briefly, it is as fol lows : (1) Australasian Petroleum Co. Pty.

Ltd. has been incorporated in Melbourne with a nominal capital of £1,000,000, in £1 shares, to take over the oil-search permits and all property of Oil Search Ltd. and Oriomo Oil Ltd. (both Austra lian companies) in New Guinea and Papua. (2) The shareholders in the new Co. are Vacuum Oil Co. Pty. Ltd., Mel bourne (subsidiary of and wholly owned

by Standard-Vacuum Oil Co., New York) D’Arcy Exploration Co. Ltd., London (sub sidiary of and wholly owned by Anglo- Iranian Oil Co. Ltd.), and Nominated Holdings Pty. Ltd., Sydney, a subsidiary of and wholly owned by Oil Search Ltd and Oriomo Oil Ltd. Vacuum Oil Co.’ p ty-. Ltd. has the right to introduce one additional shareholding company. (3) Vacuum Oil Co. Pty. Ltd and D’Arcy Exploration Co. Ltd. each have subscribed for 135,000 £1 shares in the new Co., to be paid for in cash, and Nom inated Holdings Pty. Ltd. will be allotted 135,000 fully paid shares. The additional Co., if introduced, will also subscribe for 135,000 shares of £1 each to be paid for m cash. Australasian Petroleum Co Pty. Ltd. will pay to Oil Search Ltd. a sum equal to the amount expended on the areas held under Special Permits, ap proximately £45,000. The initial working capital of the Co. will be £270,000 less the amount payable to Oil Search Ltd. (4) Australasian Petroleum Co. Pty.

Ltd. have assumed the control and direc tion of the geological surveys hitherto carried on by Oil Search Ltd. and Orio mo Oil Ltd. in New Guinea and Papua. (5) The following are first directors of the new Co.:— Hugh Hamilton (Melbourne), Chair man of Vacuum Oil Co. Pty. Ltd., di rector of New Zealand Petroleum’ Co.

Ltd. and Island Exploration Co. Pty.

Ltd.

Wesley A. Ince, solicitor (of Arthur Robinson & Co., Melbourne), director of N.Z. Petroleum Co. Ltd. and Island Exploration Co. Pty. Ltd.

W. J. Byrne, solicitor (of Whiting & Byrne, Melbourne), chairman of Com monwealth Oil Refineries Ltd.

M. T. Lloyd (Melbourne), attorney in Australia for Anglo-Iranian Oil Co.

Ltd., and managing director of Com monwealth Oil Refineries Ltd.

William Addison Freeman (Sydney), president of Placer Development Ltd., chairman of Bulolo Gold Dredging Ltd. and Oil Search Ltd., director of Aus tral Malay Tin Ltd., etc.

Eric Furnival Griffin (Sydney), man aging director of Oil Search Ltd. and Oriomo Oil Ltd., etc. (6) The shareholding companies in Australasian Petroleum Co. Pty. Ltd., other than Nominated Holdings Pty.

Ltd., have the right to purchase from Australasian Petroleum Co. Pty. Ltd. in such proportions as they may mutually agree, the whole or part of the crude oil, casing head petroleum spirit, and the natural gas. produced and saved, at the fair price thereof. Such price shall be agreed upon by all the shareholding com panies, and, failing agreement, shall be fixed by arbitration. (7) Immediately upon taking over con trol of the Special Permit areas in New Guinea and Papua, Australasian Petro leum Co. Pty. Ltd. will carry out an active and vigorous search for petroleum in such areas, and upon discovery of petroleum in commercial quantities will produce it in accordance with good oil field practice. (8) Anglo-Iranian Oil Co. has a paid up capital of £32,849,757; and the Brit ish Government hold the controlling in

terest in the Co. The Standard Vacuum Oil Co. has a capital of 10,000,000 dollars, held jointly and equally by Standard Oil Co. (New Jersey) and Socony-Vacuum Oil Co—probably the largest oil organ isation in the world. Nominated Hold ings Pty. Ltd., just registered in Syd ney, has a nominal capital of £350,000.

In so many words, this simply means that the permits held in Papua and

New Guinea by Oil Search Ltd. are now taken over by Anglo-Persian (or, if one must be correct, by Anglo-Iran ian Oil Co.) and Vacuum. Hitherto, three main groups have been seeking oil there—Papuan Oil Developments (Shell Co.), Island Exploration (Vacuum Co.) and Oil Search (an Australian Co.). The new move means that every great oil combine in the world is now interested in the search.

The appearance of Anglo-Persian in the picture was expected; but the intro duction of Vacuum here is somewhat of a surprise, seeing that Vacuum was al ready operating as Island Explorations.

Presumably, this development, and the appearance of two I.E. directors on the new board, will mean that I.E. and A.P. (which, incidentally, can stand for either Australasian Petroleum or Anglo-Persian) will be operated more or less in con junction. It means that the Anglo-Per sian and Vacuum groups now apparent ly have rights over a much larger area in Papua and New Guinea than the Shell group. But that may not mean any thing—no one knows where oil will be found —if ever it is found. It may be found first on the pocket-handkerchief

Apinalpai area, held in Papua by the Walter Marks (Sydney) group.

The probability that Anglo-Persian and Vacuum would take over the Oil Search areas in Papua may have been the reas on why the Lieut.-Governor of Papua, on September 1, by issuing new on-pros pecting permits (Nos. 8 and 9) to Papuan Oil Developments Ltd., granted addi tional territory to the Shell group. No. 8 area, 1,100 sq. miles, lies around Port Moresby, and No. 9 area, 1,600 sq. miles, lies along the coast, eastward of No. 8.

The whole of the Territory, westward of Port Moresby, is now divided up be tween the three (original) oil-seeking companies. Permits 8 and 9 represent an eastward extension of the oil search.

There are 87,000 sq. miles on the Papuan mainland: and oil rights over 56,000 sq. miles have been granted.

The importance of the development, financial, scientific and political, cannot be exaggerated. It means that the three richest oil groups in the world —Vacuum, Shell and Anglo-Persian—are putting their unlimited resources behind the search for oil in Papua and New Guinea: that the greatest scientific skill in the world, which is at the disposal of the companies, will be engaged in the search: and that it is impossible, in the circum stances. to imagine that New Guinea is likely to be handed over to any other nation.

The international character of the new company may be emphasised- Brit ish, American and Australian. A glance at the directorate shows that there come into the new organisation not only An

Mr. W. A. Freeman, head of the well-known New Guinea concerns of Placer, Bulolo, and Oil Search, is a director of the new million pound company seeking oil in Papua and the Man dated Territory.

glo-Persian, Vacuum, and Oil Search, 'but also, indirectly, Commonwealth Oil Refineries (which means the Govern ment of Australia), the New Zealand Pet roleum Co., and the now rich and pow erful Placer-Bulolo Gold group, Papuan and New Guinea people may not like

combines; but here, at least, is a com bination that gives them an assurance that, if there is oil in their country, it will be found and, what is more, pro duced and distributed. It is as well to remember, in connection with any oil search, that there is now an ample sup ply of oil for world requirements. It is one thing to find oil; but quite another to market it.

Mr. W. A. Freeman

Extraordinarily good work appears to have been done by someone in turning Oil Search Ltd. from a comparatively small Australian company, with limited resources, into a very powerful interna tional organisation, with limitless re sources. Two or three men gain kudos; but the chief credit goes to Mr. W. A.

Freeman, a quiet-speaking, calm-plan ning Sydney solicitor, who has worked for a long time, with great patience, for this development. His success caused no surprise to those who knew his achievements in connection with the Placer-Bulolo companies—two of the prettiest money-spinners of the present decade.

There is one note of regret in all this —regret that the indefatigable E. L.

Walter (who organised Oriomo Oil. out of which Oil Search was born) did not live to see the impressive thing into which his early plan has grown. It must be over ten years since Mr. Walter sent his first oil-seeking expedition into the Papuan jungles.

All this is pleasing and promising; but oil is still to be found. Hundreds of

skilled young men are ranging over the great island' of New Guinea, and hun dreds of thousands of pounds are being spent; but not one word yet has been said to give us an assurance that there is a commercial oilfield in New Guinea That fact may add fervour to our hope that the new company will be very success ful.