Deals Robert Gillespie Reid made with the Government of Newfoundland over a century ago are still putting money in the family business today. He was sometimes called the king of Newfoundland.
They are the directors of the Reid Newfoundland Company Ltd. , the descendants of Newfoundland’s own railway and forestry baron Robert G. Reid. In March, Marathon Gold paid $500,000 in cash and issued 1,341,607 common shares to Reid, with a promise to pay another $3 million in cash once the project was formally released from the federal and provincial environmental process.
So if Marathon had already secured all the necessary permits from the province to move forward with the Valentine Lake project, why did they have to do a deal with a private family-owned company? Marathon’s CEO Matt Mason explained in a press release last March, “The NPI Royalty that we purchased today relates to certain properties at the Valentine Gold Project referred to as the “Reid Lots”. These properties were initially granted to the Reid Newfoundland Company Limited in the early part of the last century in connection with the development of the Newfoundland railway. “The NPI Royalty, which was initially reserved in 1905 and amended in 1948 to provide for a 7.5-per-cent net profits interest royalty on all minerals, continues to apply today in the areas of the Leprechaun and Sprite Deposits and part of the Berry Deposit,” said Manson. “Our acquisition of the NPI Royalty for cancellation is another key milestone as we progress the Valentine Gold Project towards a construction decision, and we are happy to welcome Reid as a Marathon shareholder.”The Reids can thank the family patriarch, and company founder, Robert Gillespie Reid for their good fortune. Deals he made with the Government of Newfoundland over a century ago are still putting money in the family business today.The Scottish engineer was 48 years old when he and a business partner, G.H. Middleton did a deal with the Newfoundland government to finish building a railway across the island. An American syndicate had started the job in 1881 but began to run out of money the following year. By 1884 that company, the Newfoundland Railway Co.Ltd., was bankrupt with just 84 miles of track laid from St. John’s to Harbour Grace. They had to build another 300 or so miles of track accomplish their goal of connecting St. John’s in the east to Hall’s Bay in the west.Robert G. Reid's landholdings in 1902 are noted as grey block on this 1902 map of Newfoundland. Thanks two two deals with the province the Scottish-born engineer held title to over three million acres of land, making him the largest landowner on the island. Photo from Heritage Newfoundland and Labrador website - Heritage Newfoundland and Labrador Reid and Middleton presented the lowest-cost option, offering to build the line for $15,600 per mile.He was an experienced engineer, having already design and supervised construction of sections of the Trans-Canada railway.“The principal contractor was known to be wealthy, and his financial standing was unexceptionable,” wrote Judge D.W. Prowse in his “History of Newfoundland” published in 1895 . By the end of 1891, Reid and Middleton had completed 60 miles of railway, employing 1,800 men in the process.The two men dissolved their partnership in 1892 and Reid pushed on with the contract, completing 80 more miles of railway by the end of that year. Prowse wrote enthusiastically of the railway construction, and Reid, saying, “Mr. Reid has fulfilled all his obligations with the utmost honour and punctuality; his able and energetic sons W.D. Reid and Harry Reid are universal favourites with the labourers on the line; the men are well treated good, honest work has been done on the new line…” In 1893 Reid signed another contract with the province, to continue building tracks westward towards Port aux Basques. The trains were still running in the early 1980s on the Bonavista branch line, on tracks built by the Reid Newfoundland Company, But the days of rail transport on the island of Newfoundland were coming to an end. In 1988 premier Frank Moores signed an $800 million roads for rails agreement with Ottawa. The money would provide severance for CN employees in the province, remove the rails and upgrade highways. SaltWire File Photoompiled by Heritage Newfoundland and Labrador. In return for his agreement to operate the line from Placentia to Port aux Basques for 10 years Reid received 5,000 acres of land for every mile of track operated. Five years later, the government inked another deal with Reid, an agreement that would give him even more land through his recently-incorporated company Reid Newfoundland Railway Co. Ltd. Under that deal, explained Richard Gwyn in his book Smallwood: The Unlikely Revolutionary, the government granted Reid perpetual rights to two and a half million acres of land on either side of the track as well as “a monopoly on rail, mail, telegram and steamship services; exemption from all taxes; a sum of $15,000 for each mile built; and an outright grant of $3.5 million to maintain and operate the service.”Reid became the largest landowner in the province, with parcels of land grants only alongside the rail line but in remote places where tracks were never laid, like the Great Northern Peninsula, the Gander Bay Loop and on Random Island. That’s because the deal allowed Reid the option of selecting lands elsewhere where land along the railway was unsuitable, explained Robert Cuff in a 2001 article for the Newfoundland Heritage Society. Robert G. Reid died in 1905 but his sons, William and Harry, who had been very involved with the Newfoundland operations since the original 1890 contract, continued to do business with the government. In 1910 newly-minted premier William Morris decided the island needed six branch lines, to connect rural places like Bonavista, Bonne Bay, Trepassy, Heart’s Content and Fortune Bay to the main cross-island line.The contracts meant much-needed revenue for the Reid Company, which was now struggling financially. The railway business had not been as profitable as predicted. By 1920, according to Heritage Newfoundland and Labrador, the company was losing about $1.5 million annually and was appealing to the government for financial aid., the global economic depression that began in 1892 hit Newfoundland hard. Two of the province’s three banks crashed in one day in 1894 and the government was frequently turning to Robert Reid for financial advice and emergency loans.The railway, however, had been a money-sucking venure and by 1921 the Reids were ready to wash their hands of it. Through the Railway Settlement Act of 1923 the province acquired the railway and coastal boat operations from the Reids for $2 million, in recognition of the investments they had made in the operation while they were running it.A train runs through Bowering Park, St. John's, in this photo taken in the 1980s. Gary Healey Facebook Photo - Facebook photo by Gary HealeyThanks to those land grants, which the Reids still held, they had property to sell. It allowed the company to reorganize and avoid bankruptcy.In 1973 the Reid Newfoundland Company still held 500,000 acres, according to Heritage NL, when Ian Reid — a descendant of Robert G. Reid — offered to sell them to the province.In 1975 the Progressive Conservative government of Frank Moores adopted the Reid Lands Acquisition Act, transferring Reid lands to the province. The Act stated, in part, “ … the lands referred to are … deemed to be Crown lands within the meaning of the Crown Lands Act.”That means the Reids still held the rights to what lies beneath the surface of the lands they once owned.The mining company had to put up about $7 million in cash and shares to the Reid Company for Reid’s rights to the minerals on lands they held around Valentine Lake. Some suggest lack of foresight on the part of successive provincial governments, while others might see it as savvy business management on the part of Robert Reid and company. Some in the mining industry, though, say those land grants derailed plans for mineral exploration and mining developments on the island of Newfoundland. An article published in 2017 on www.mining.com suggests the land grants to the Reids in exchange for a rail line ultimately did just that. “These “Reid Lots” were akin to modern day patented claims, and made the Reid Newfoundland Company the largest landowners in the province,” suggested“With such a small group holding onto the majority of the prospective land for decades, it’s no wonder Newfoundland remained under-explored through the various gold cycles.”According to Heritage Newfoundland and Labrador, the descendants of Robert Reid’s son Harry remained most closely associated with Newfoundland.
Please follow us on Google to support us Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
COMMENTARY: Cancer research public interest group reflects on busy 2022 in Newfoundland and Labrador | SaltWireIgnoring cancer does not do us any good, writes Sevtap Savas, PhD. Click here to read about what a team of community members affected by cancer alongside scientists from Memorial University and Eastern Health accomplished in 2022.
Read more »
SaltWire Today: Your online Halifax newscast | SaltWireYour online Halifax newscast for January 3, 2023.
Read more »
Digging it: Newfoundland and Labrador’s mining industry expected to pick up steam in 2023 | SaltWireNewfoundland and Labrador is believed to be home to 24 of 31 'critical' minerals identified by federal government.
Read more »
Six people arrested for impaired driving in two days at police checkpoints in Newfoundland | SaltWireFour of the six people arrested had tested positive for cannabis.
Read more »
Marathon, New Found continue to hunt for gold in central Newfoundland | SaltWireMarathon Gold is well into building its mine for the Valentine Gold Project in central Newfoundland this year, but the company says it will also continue ...
Read more »
SaltWire Today: Your online Halifax newscast | SaltWireSaltWire Today for January 4, 2023.
Read more »