Berens to Lytton

I have the honor to acknowledge the receipt of Mr Merivale's letter,
dated Downing Street the 12th instant, on the subject of the
expenses incurred by the Hudson's Bay Company in searching for Coal
at Fort Rupert, and stating that unless the Directors of the Hudson's
Bay Company can give evidence that it was intended to carry the
proceeds of the Fort Rupert Mine, (had it succeeded) to the public
account, Her Majesty's Government are not prepared to reimburse the
Company the expenses they incurred in that undertaking.

The Directors of the Hudson's Bay Company feel it would be difficult
to bring evidence of an intention on their part to carry the proceeds
of the Fort Rupert Mine to the public account, as in consequence of
the search having proved a failure, the question as to proceeds never
arose; but they would beg to remind you that the search for Coal was
originally undertaken by the Hudson's Bay Company as one of the means
of promoting Colonization in Vancouver's Island. That object was
attained by the addition to the British population of the Island of a
large number of Miners and other immigrants connected with the
working of the Coal, who were sent out from England at a very heavy
expense.

The Coal Mine at Nanaimo now in the hands of the Hudson's Bay Company
has hitherto been unremunerative, and under these circumstances
considering that the public alone have been the gainers, the
Directors of the Hudson's Bay Company think that, although they may
have no strictly legal right, they have nevertheless an equitable
claim on the liberal consideration of Her Majesty's Government with
reference to the actual loss sustained by them in the search for the
Coal at Fort Rupert.