AKO established works at Joadja Creek, some 16 miles west of Mittagong, to process kerosene and other products from oil-shale seams mined on the valley’s steep cliff-face. Seams of coal were also mined.

AKO built a private, narrow gauge railway from Joadja to Mandemar in 1879. By the end of 1880 the line was extended to Mittagong, to an AKO depot alongside the main Southern Line, half a mile south of the station.

The depot’s sidings were so arranged that the train from Joadja could enter a transhipment dock at the top of a long cutting. This allowed for easy unloading into wagons, marshalled on a lower level.

AKO’s output included bulk kerosene and lubricating oils as well as candles, soaps and waxes made from paraffin. These products were freighted by rail to buyers in Sydney and beyond.

Five small-tank steam locomotives were purchased from Andrew Barclay & Co of England. Two were engaged at the Joadja works, while three worked the line to Mittagong.

The Joadja Railway is described by Leonie Knapman in her book about Joadja’s history. The rail line to Mittagong was laid across the land in a very basic and primitive fashion, with few earthworks provided. Roughly split hardwood from nearby trees was used for sleepers and coal provided for ballast. It is no wonder that heavily laden trains had to travel slowly, usually taking 90 minutes each way.

When, however, an injured miner had to be rushed to Mittagong in 1879, the engine (without wagons) apparently completed the trip in 36 minutes.

The rolling stock included a number of open box trucks with sloping ends and drop sides to convey shale and coal. Tank wagons of crude design were used for carrying fluids. Cased goods and general merchandise were carried in stout covered wagons with double doors and roofs of corrugated iron.

A passenger carriage was included two days a week, with travellers on other days being allowed to perch on the coal tender. The carriage had no windows, only open spaces with seats arranged lengthways. Travel was uncomfortable, particularly in bitter winters and the heat of summer. Passengers used umbrellas as protection from the cinders which fell and pitted their clothes with tiny burn holes.

Despite being slow, clumsy, dirty and dangerous, the railway was a vital link to the outside world for the AKO Company and its workers and their families at Joadja.

The population at Joadja, mostly Scottish emigrants, grew to almost 1000 in the I880s. The AKO provided all the necessities of life to the self-sufficient community.

By 1879 there was a post office, slab school, two butchers' shops, two bakeries and about 75 houses and huts. In 1882 a fine stone building was erected for teacher and pupils, with about 90 children enrolled.

The AKO executives lived on the creek’s south side, amid burgeoning orchards, with well-ordered gardens. The workers’ houses varied in quality, but the 24 brick cottages built in Carrington Row were more spacious than miners' homes in the industrial towns from which the workers had emigrated.

Consistent with its self-sufficiency principles, AKO planted extensive orchards opposite the refinery. It also planted fruit trees and grape-vines at the top of the main incline. Nutritious shale ash helped to fertilise the soil and kerosene emulsion eradicated scale pests on the trees. The orchards produced more fruit than the residents required, so apples, pears, cherries, plums, apricots and grapes were packed and sent out by rail via Mittagong to Sydney markets.

The Joadja works existed primarily to produce kerosene. The process was eventually superseded by conventional kerosene production from oil, and shale mining became uneconomical. In 1911 AKO went into liquidation and auctioned Joadja.

Orchard fruits continued to be marketed until 1924. The main incline remained in use to bring produce up from the valley and horse drays hauled the fruit to Mittagong.

After 1924 the township was abandoned. Its remaining features, now restored, are an attraction for visitors. Scant evidence remains of the Joadja to Mittagong railway, dismantled in 1908.