The prospects of the undertaking were, however, still far from encouraging, and when, in February 1853, the directors represented to the Board of Admiralty that the expense arising from the greatly increased price of coals rendered the portion of their service between Callao and Panama altogether unremunerative, and asked for an increase of subsidy, they were refused. The directors then solicited permission to employ between these two places vessels of only 100 horse-power and 400 tons, which they considered would be sufficiently large for the passenger traffic, and would restore the balance of profit by reducing the cost of fuel. They also undertook that these vessels should be capable of maintaining an average speed of 10 knots an hour, and that the mail service should not suffer. This proposal Government acquiesced in, temporarily, reserving to itself the right of reverting to the original agreement. The more frequent and more speedy services had, indeed, become, if not necessary, at least desirable, since the West India Mail Packet Co. had doubled the services of their ships between England and Colon. The Pacific Co. therefore felt that, if they did not run their vessels to and from Panama in connection with the steamers from England, those of the United States of America, now rapidly increasing in the trade of the Pacific, might soon monopolize the lines they occupied from the Isthmus to the southern ports. Consequently, the directors of the Pacific Company were glad to accede to the proposal of the Admiralty to run steamers with the mails monthly from Panama, for the small increase of 5000_l._ per annum to their original contract of 20,000_l._ This Company had now in its service seven vessels of 5719 tons and of 2396 horse-power; but, though they touched at no less than thirteen ports between Panama and Valparaiso inclusive, the average annual amount of receipts for postage, for five years previously to 1860, amounted to only 5441_l._ In 1856, Mr. Just visited the west coast, and re-organized the management and the service generally with very successful results. Towards that success his adoption of the compound engine,[286] then almost a novelty, materially tended, effecting as it did, an enormous saving in the consumption of fuel and, consequently, in the current expenses of the Company. [Sidenote: Marked improvement in the prospects of the Company, 1860.] [Sidenote: New lines.]