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Wednesday, 26 May 1926

Senator PEARCE (Western Australia) (Minister for Home and Territories) . - This matter first came under the notice of the Government as a result of a letter received by the honorable member forPerth, Mr. Mann, who forwarded it to the Prime Minister. The letter is as follows: -

Chamber of Automotive Industries, McEwan House, 343 Little Collins-street,

Melbourne, 25th March, 1926.

Dear Mr. Mann,

ReCommonwealth Oil Refineries Limited's application for more capital.

The attached will interest you, because it shows that the Commonwealth Oil Refineries

Limited, whilst claiming to be selling petrol cheaper than the importers, is supplying a brand equal to the importers' third grade; therefore the importers are selling petrol equal to Commonwealth Oil Refineries Limited at lid. lower.

I do not think additional capital should be granted until the Commonwealth Oil Refineries Limited's balance-sheet is produced. It should have been lodged last June, but the company has not yet done so. If that concern, which has established an already heavy expense for taxpayers, is to be further subsidized, would not it be better to close them up altogether?

Youneed not return the attached papers. These figures have been obtained for the Chamber of Automotive Industries, and I think that you should give publicity to them from the House in the interests of the community.

Yours faithfully, (Signed) H. W. Harrison,


Honorable senators will notice that the letter, by its beading, its last paragraph, and the signature purports to come from the Chamber of Automotive Industries, and is signed by its secretary. Upon receiving it the Prime Minister referred it to the Board of Directors of the Commonwealth Oil Refineries Limited, from whom he received the following reply, dated 9th April, 1926: -


It is hardly necessary forme to say that the letter from Mr. Harrison, as secretary of the Chamber of Automotive Industries, which, however, is repudiated 'by the chamber (see copy of the president's letter), is full of inaccuracies, so presented as to support the contention in regard to Commonwealth Oil Refineries products -

(1)   It may be as well to state that Mr. Harrison was formerly the advertising manager of the Vacuum Oil Company. He, for some time, acted as editor of the Australian Motorist, and we understand that he was enabled to acquire the proprietorship through the financial assistance of importing interests.

Its policy has been consistently antiCommonwealth Oil Refineries Limited, In the April number there is an article written by the editor, headed, " Is the Commonwealth Oil Refineries playing fair with the public ?" in which he makes the same accusations as those contained in his letter to Mr. Mann.

(2)   In regard to the statement that the Commonwealth Oil Refineries are selling the same grade ofmotor spirit under three separate brands, charging three different prices, and thus defrauding the public, this is disproved by the letter received from Messrs.

Avery and Anderson, copy of which is attached hereto.

(3)   It must here be said that there is no recognized definition of a first grade spirit as such. Each crude produces a different class of motor spirit, and, subject to the way it is distilled, gives different grades.

The first grade obtained from on; crude may be inferior to the second grade of another.

(4)   As a statement of fact, practically all the brands marketed in Australia are first grade spirit.

(   5 ) At the Laverton refinery two " cuts " of spirit are made, which constitute the brands marketed as " Yellow Label," the first cut (first grade) and " Power Benzine," or " Red Label," marketed as third grade.

The grade marketed as " White Label" (second grade) is a blend of the two cuts, and was put on the market to meet the Vacuum Oil Company's second grade " Kalif " brand (which, by the way, is pro- bably a better all-round spirit than their first grade, "Plume"), and the British Imperial Oil Company's second grade brand " Anchor."

(6)   The outside companies such as the Neptune's, " Waratah," and the " Gold Crown," sold their brands at11/2d. per gallon less than "Shell" and "Plume," and for that reason came to be looked upon as second grade, though, in reality, they were both marketing spirit equal to "Shell" and "Plume."

(7)   In regard to the statement that the Commonwealth Oil Refineries' three grades are one and the same thing, the refineries' analysis attached hereto refutes this accusation, and any one knowing anything about refining or motor spirits, will readily realize this is the case; but, unfortunately, the public have little if any knowledge.

(8)   The letter to Mr. Mann and the article are very cleverly written, as they are only giving the opinion of Mr. Harrison.

(9)   The refineries' analysis differs from that of Messrs. Avery and Anderson in what will appear to the public very small fractions, but which make all the difference. Messrs. Avery and Anderson are a reputable firm, and their fraction ization is no doubt genuine; but, as they were not responsible for the collection of the samples, reliability as to the genuineness of the samples may be open to question, nor is the fractionization alone a standard of good or bad spirit, but the aromatic and other' contents must be taken into account. In " aromatics" the Commonwealth Oil Refineries' is the best.

(10)   The only real test is practical use. Any one putting " Yellow Label " and " Power Benzine " into their cars can soon find out for themselves whether " they are all one and the same grade."

(11)   "White Label" being a blend of the two would be more difficult to detect in actual test, and might even suit some makes of cars better than "Yellow Label."

(12)   Whether Commonwealth Oil Refineries is a first, second, or third grade spirit, there is no getting away from the fact that " Yellow Label " gives results comparable with the best spirit obtainable on the market.

If Mr. Mann could find time to visit the refinery, he would very soon be convinced of the company's bona fides. It might even be advisable to ask him to raise the question in the House, when the true facts could be given. It would certainly be a cheap and sure method of refuting the inferences suggested in the letter, and would give wide publicity.

Now I shall read a letter from the president of the Chamber of Automotive Industries, dated the 9th April, and addressed to Major Bird, Managing Director of the Commonwealth Oil Refineries Limited. It is as follows: -

W.   L. W. Bird, Esq., Managing Director, Commonwealth Oil Refineries Limited, 313 Flinders-lane, Melbourne.

Dear Sir,

In reply to your letter of the 9th April, forwarded by hand this morning, the following are the facts as the writer knows them.

On the 10th March ( approximately ), we were asked to obtain tins of the three different grades of motor fuel marketed by the British Imperial Oil Company, the Vacuum Oil Company, and yourselves. This we did, and on the 1 1 th March samples were drawn by a representative of the analyst from each tin, and these samples were then, removed from our premises. We heard nothing further of tills until the writer . saw the article published in the Australian Motorist of this month's issue. Mr. Harrison had no authority whatsoever from either the committee or a general meeting of the Chamber of Automotive Industries to make the . tests made, and at no time have cither the committee or a general meeting of the chamber ever discussed the question of the merits or demerits of the various fuels or of the action of any of the oil companies as a body. To be perfectly clear on this matter, I have not the slightest doubt that the committee would instantly authorize me to show you the whole of our . minutes covering all business discussed at cither committee or general meetings, and I will further distinctly state that we have not approved or authorized the letter signed by Mr. Harrison.

Yours faithfully.

Chamber of Automotive Industries, (Signed) Ernest A. Bell,


There is another letter which has an interesting bearing upon this matter. It is from the Commercial Vehicles Proprietary Limited, Lonsdale-street, Melbourne, dated 9th. April, and is as follows : -

R.   J. Larking, Esq., Distribution Manager, Commonwealth Oil Refineries Limited, 313 Flinders-lane, Melbourne.

Dear Sir,

In reply to your inquiry as to our experience with the different grades of Commonwealth Oil Refineries Limited motor fuel, we would state that, during last' winter, we were using solely the Red Label spirit, but found that, for demonstration purposes, starting heavy lorries by hand was a little difficult, and we therefore changed over to Yellow Label, a marked difference being noticeable, and we could trace no difference between Yellow Label spirit and the first quality spirits of the Vacuum Oil Company and the ' British Imperial Oil Company, i.e., "Plume" and "Shell" motor spirits.. We would like to point out that, when using the Red Label spirit, no difficulty was experienced in starting the machines when warm. You will readily appreciate, from a demonstration point of view, quick starting was an important factor, hence our change to Yellow Label spirit, which we are still using.

Yours faithfully,

Commercial Vehicles Proprietary Limited, (Signed) E. A. Bell,


Now comes the letter from the firm which made the analysis on which the article is alleged to be based. It is as follows: -

Avery and Anderson, Industrial Research and Analytical Chemists, Collins House, 360 Collins-street, Melbourne, 9th April, 1926.

R.   J. Larking Esq.,

The Commonwealth Oil Refineries Limited, 313 Flinders-lane, Melbourne.

Dear Sir,

Our replies to the questions asked in your letter of even date referring to an article appearing in the April issue of The Australian Motorist, are as follow : -

(   1 ) The deductions contained in the article are not ours. We carried out distillation tests asked for by Mr. H.W. Harrison, and reported the results of the tests without any comment.

(2)   In our opinion the deductions are not justified by the figures.

(3)   . The figures as set out do not justify any conclusion regarding the relative merits of the various motor spirits. They indicate only the relative volatility at the given temperatures; a much more exhaustive examination is necessary to enable a comparison to be made of their values as motor fuels.

The figures at the top of the columns in the results of the distillation tests indicating " 1st grade," "3rd grade," &c., are not ours. Our only description of the samples is the name of the spirit, and in some cases the colour of the label as given in the report.

Yours truly,

Avery & Anderson. - (Sgd.) D. A vest.

What can only be regarded as a contemptible attempt, by the misuse of an analysis obtained from Messrs. Avery and Anderson, to damage the reputation of the Commonwealth Oil Refineries Limited spirit is absolutely disproved by the correspondence I have read.

Question resolved in the affirmative.

Bill read a third time.

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