A.—No. 16.

parts of New Zealand where similar superficial features prevail, as the information which has been derived from actual observation of the district is yet very limited. It must be distinctly understood that there is no similarity between the mode of occurrence of the rock oil, so far as it has yet been found at Taranaki, to that which prevails in the oil-bearing districts in the United States of America and Canada; for although it is held by some geologists that in these countries the oil has also been produced by destructive distillation of coal seams, which are now represented by seams of anthracite coal, or have been wholly removed by denudation ; still the nature and arrangement of the condensing rock has been very different, and this, of course, will completely alter the case so far as the practical search for petroleum is concerned. In the United States the wells are sunk principally in very ancient strata —older, perhaps, than many of the slate rocks of New Zealand, but lying in an undisturbed and nearly horizontal manner over immense areas. In Oil Creek Valley, according to Professor Draper, these strata consist of clay shale in beds of about one hundred feet in thickness, separated by layers of sandstone of twenty to thirty feet. The borings are carried through alternate beds of this description to a depth of 400 feet before the oil is obtained plentifully, although it also exists in the upper strata in small quantity. In this case it undoubtedly percolates through the more porous layers of sand rock, so that the process for obtaining it is like ordinary well-sinking, and a continued supply can be calculated on with considerable certainty. In Canada the oil is also obtained much in the same way by piercing horizontal beds of limestone and shale of Silurian and Devonian age, the oil being found in the cracks and fissures of the former rock. In that district there are also surface wells sunk in the superficial gravel and clays that have been saturated with the oil rising to the surface by natural springs. The steady supply of rock oil from the American wells is no doubt due to the great extent and regularity of the porous strata in which it has been accumulated, and through which it percolates in the same manner as water supplying artesian wells. The petroleum wells of Italy, Asia Minor, and the Crimea, have more resemblance to what may be expected in New Zealand, in so far that the oil escapes from strata of tertiary age and is always more or less distinctly connected with active or extinct volcanic agency. Professor Ansted in a recent article on this subject, describes the petroleum in the Crimea as springing from blue clay shales that underlie a crust of marine limestone of recent tertiary formation. The petroleum wells up in the bottom of valleys that have been eroded through the limestone and so exposed the shales, and evidence of deep-seated chemical action is indicated by mud volcanos from which liquid mud accompanied with an escape of gas, slowly oozes and forms conical mounds and hillocks. In these tertiary strata we have a marked resemblance to the older tertiary rocks of New Zealand which overlie the brown coal formation, and as I have already described, underlie the eruptive rocks of such volcanic centres as Mount Egmont; and I am inclined to think that the proper place to expect petroleum to occur in large quantities may be in connection with lines of dislocation at some distance from the centre of disturbance, and where the older tertiary rocks come up to the surface. In the Taranaki district this would be to the north of New Plymouth, and in localities where perhaps there might be no surface indications excepting those which everywhere mark dislocations of tlie strata. From the above considerations it is probable that, in the neighbourhood of Sugarloaf Point, where these explorations are being made, the boring will have to be carried to a very great depth before a constant or abundant supply of oil can be looked for, unless, as is not improbable, when sinking through a rock which appears to be in parts saturated with oil, an open cavity or fissure be accidentally struck in which a large quantity of oil has accumulated. Such natural cavities are frequently struck when boring in the sandstone in America, the result being a sudden and forcible discharge of gas, oil, or water, according to whether the upper, lower, or middle part of the cavity be first tapped ; but before long this spontaneous overflow always ceases, and then the ordinary method of pumping has to be resorted to. If, however, the oil has been condensed in the fissures that traverse the trachyte breccia at Taranaki, from the form of vapour, and if it does not percolate freely through the substance of the rock, as it does between the layers' of sandstone and shale m America, I fear that the pumping will not be of much avail. The specimens of petroleum submitted have been carefully analysed in the laboratory of this department, by Mr. Skey, and from the result of his examination it would appear that the nature and value in relation to other petroleum oils, of the samples as yet obtained, has been somewhat overestimated, and that they must only be looked upon as a good indication that really valuable oils may exist in the neighbourhood. All the various samples which have been submitted have the same physical characters, having a dirty green color by reflected light and being opaque, unless examined in thin films, when it has a deep red color by transmitted light. At GO ° Pah. it is quite liquid, and though at lower temperatures it has considerable consistency, yet when reduced to 25 ° Fah. it docs not become solid. It has a mawkish but not unpleasant odour, being very different in this respect from most rock oil, and is especially free from all traces of sulphuretted hydrogen gas. Minute flakes of a white substance, probably allied to paraffine, float in the oil, and are gradually deposited, when it is allowed to remain quiet at a low temperature, nearly the whole of this solid substance becoming dissolved when the oil is gently heated. The temperature at which the oil boils is 340° Fall., and it does not appear to evaporate much at ordinary tetnnerature for when exposed to the air it remains unchanged, neither thickening, nor acquiring a skin on the surface.

4

REPORT ON THE PETROLEUM