would more than cover; and, with the present prospect of shipping to this Port, a larger revenue from towage than quoted would be derived. A vessel will be required soon for the purpose of laying down further operations this season.

The amount of shipping now visiting this Port, more particularly iron steamers, demands that accommodation should be given them for repairs. As the erection of a Patent Slip capable of taking up a vessel of large tonnage will involve an outlay of not less than £20,000, thereby deterring private enterprise from engaging in the work, I would therefore recommend that the Government should secure the Bay frontage on the south side of Acheron Head, that being the most suitable site, and thereon erect a Patent Slip capable of taking up a vessel of 1,200 tons. The character of the Port I have no doubt is at present suffering from the want of accommodation for the repairs of vessels. I would also recommend that a Steam Dredge should be procured, with a view to deepening Dunedin Bay. Much inconvenience is still felt, notwithstanding the increased Jetty accommodation, as over-sea vessels cannot get alongside, and in consequence are compelled to lighter their cargoes, which invariably leads to a certain amount of loss and destruction of property. Vessels drawing (12) twelve feet water are taken up to Dunedin Bay, while at the end of the Jetties there is only a depth of (8) eight feet at high water; it would therefore be desirable to deepen the harbour so as to give the required accommodation.

5th. At the Taieri there is not any increase of coasting trade since my last report of this Harbour to your Honor. The signals for steering vessels, and showing the state of the tide and bar, are carefully attended to by Mr. Irving, and are of great service to the few vessels visiting this Port. The River and Waihola Lake Steam communication is kept up by the owner of the steamer “Betsy Douglas,” and who, I understand, has a new steamer on the way out from England, and which he intends placing on the same line.

6th. At the Molyneux there is an increasing trade; being a Port of Entry, the high way to extensive Gold-fields, sheep and agricultural districts, we may expect an increase of foreign trade. The abundant supply of coal in this locality will also be an inducement for shipping to visit this Port. The signal station is under the management of Mr. Hoggart, whose services and attention to the bar and tidal signals the ship-masters trading to the Port consider of great value. The inner branch of the river has been partly cleared of the snags as far as the Ferry; the waters having risen has put a stop to further operations this season. There is a sufficient width of channel for a steamer drawing (3) three feet to pass up as far as the mouth of the Tuapeka. In order that over-sea vessels may approach the entrance of the river with a feeling of security, and for the use of vessels that cannot enter the river, I would recommend that Moorings should be laid down in Wiltshire’s Bay; and also that as the price paid for the use of a vessel to remove the snags amounts to the value of the vessel in (2) two months, I would recommend that the schooner “Clarendon,” at present in the river, and which has been employed at the above-mentioned works, should be purchased, in order that there may be no delay, as formerly, in procuring a suitable vessel; the price asked, with tackling complete, is £280. On the arrival of the steamer for the river service, arrangements will have to be made for raising the Ferry wires, as at present the hull of the vessel will not pass clear under them. I trust that your Honor will sanction the purchase of the “Clarendon,” that I may be able to begin operations in the removal of the snags as soon as the waters fall.

7th. At Catlin’s river nothing has been done; there not being any settlers in this locality, nothing is required. It is a pity that such a valuable wooded country, possessing a good harbour for small vessels, and so near to a market in which there is a large demand for timber, should be lost sight of.

8th. At Waikawa there is a good trade done in timber, giving employment to several small vessels. This harbour has a very safe entrance, having (3) three fathoms water on the bar.

I have not made mention in the foregoing report of the desirability of establishing steam communication between Dunedin and the Molyneux, being aware that the Government is still open to receive tenders for such service. I will, in a few days, be able to furnish your Honor with a tracing of the Harbour of Otago, and Moeraki Bay, showing the soundings as at present.

I have the honor to be,

Sir,

Your most obedient servant,

WM. THOMSON,

Harbour Master.

Harbour Office,

Port Chalmers, 13th Oct., 1862.

To His Honor Major Richardson,

Superintendent.

SIR—I do myself the honor to acknow-