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e a year. In it the average cost per ton was figured $1.37, of which fixed charges, such as taxes, repairs, and insurances, were figured at 32 cents, labor 50 cents, quarrying the shale 45 cents, extraction of ammonia

10 cents.

From such figures as these, it is not hard to see why and by what means the South Manchuria Railway Company intends to work its Fushun shale deposit at a profit. For in the case of this particular company, it can get the shale without spending a cent. The Fushun coal-mine is getting out a large amount of coal through the opencut method now. In order to get at the coal deposit, about 2,000 tons of shale a day are being taken out. It is this amount of shale which the company intends to utilize in the proposed carbonizing plant. The Fushun mine, therefore, starts with the advantage of the saving of something like 30 per cent. of the working cost in the matter of quarrying the shale. Moreover, in Manchuria they have a decided advantage in the labor-cost item. The high cost of oil in the Far East is enough to make an American gasp. Under such conditions the profitable working of the Fushun shale enterprise is not at all astonishing.

Early in the summer of 1922 Mr. K. Akabane, who is now one of the directors of the South Manchuria Railway Company, happened to meet Admiral Nagasato and Vice-Minister Ide of the Imperial Japanese Navy. Mr. Akabane came out of that interview with a profound conviction of the necessity of an independent petroleum supply for Japan. It is largely to his untiring efforts that a steady investigation into the possibilities of the oil shale at Fushun has been pushed in all sober earnest. There is no one therefore who can present this matter with greater authority than Mr. Akabane. In an article published in the Far Eastern Review for April, 1924, he wrote:

The oil shale of the Fushun Collieries exists in a thick seam about 4,000 feet over the coal seam. Its total reserve is placed at 5,500,000,000 tons. By dry distilling the shale, 5.5 per cent. of crude petroleum on an average may be had. At this rate the total oil amount contained in the shale seam reaches about 300,000,000 tons, that is, 1,900,000,000 barrels, being about one-fifth of the aggregate petroleum reserve of the United States, amounting to 9,100,000,000 barrels. On this basis of calculation, the Fushun shale oil alone will be sufficient to supply Japan with her total annual wants of 6,000,000 barrels of petroleum for as long as 300 years.

Fushun shale cannot be said to have a high oil percentage, but its peculiar advantages consist of, firstly, its existence in an excessively thick seam directly above the coal seam at only a comparatively short depth from the surface ground; secondly, exceptionally low labor wages; thirdly, availability of fuel coal in an unlimited quantity and at a cheap price; fourthly, comparative plenitude of communications facilities; fifthly, abundance of water for industrial use. All these peculiar advantages work together to ensure an economic success to the oil shale industry at Fushun.

The reserves of the oil shale at Fushun Collieries, according to the various depths from the surface ground, may be roughly estimated as follows:

The total shale amount estimated to be mined from the execution of the extensive open cut mining plan, is put about 500,000,000 tons. By dry distilling the annual outputs of between 5,000,000 tons and 10,000,000

Dining-hall for the Chinese coolies at Fushun Colliery