Distillation is a process used to separate a pure liquid from a mixture of liquids. It works when these liquids have different boiling points. Distillation is often used to separate ethanol – the alcohol in alcoholic drinks – from water, by heating the mixture to specific temperatures.
Distilling in Pyrmont began as a by-product of CSR’s sugar refining business. As on many sugar plantations, rum was produced from molasses. CSR operated a small distillery at Nausori in Fiji, for this purpose. Australian Federation in 1900 and the White Australia Policy threatened the import of alcohol produced by CSR’s Indian indentured labourers, so CSR closed the Nausori operation and created a modern, much larger plant near the Pyrmont refinery, on what is now Distillery Hill. Related activities occupied most of the hillside: not only the tanks in which molasses was fermented, but a carbon dioxide plant in 1905 and a char plant in 1910.
Using pot stills, this distillery produced the highest quality rum. CSR managers did not expect their rum to earn much money, so they concentrated on quality. These methods were used to create CSR’s famous Inner Circle rum. At first this was reserved for the Board of Directors, the inner circle of managers, and their best clients. When this was produced on a larger scale in the 1950s, Inner Circle rum gained a cult following. In 1986 CSR closed production. Other enthusiasts reintroduced it in 2000, but not in New South Wales.
Distilling was a by-product of sugar refining: a range of industrial chemicals began as by-products of distilling; and from this base CSR branched out into industrial materials such as caneite – and asbestos.