SecProbe.io

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[BARNWELL INDUSTRIES INC. LOGO]

1100 Alakea Street
Suite 2900
Honolulu, Hawaii  96813
Telephone (808) 531-8400
Fax (808) 531-7181

April 13, 2007

Mr. Karl Hiller
Branch Chief
United States Securities and Exchange Commission
Division of Corporation Finance
450 Fifth Street, N.W., Mail Stop 7010
Washington, D.C.  20549

VIA FAX TO (202) 772-9220
(Original to follow via FedEx)

     RE:   Barnwell Industries, Inc.
           Form 10-K for the fiscal year ended September 30, 2006
           File Number 1-5103

Dear Mr. Hiller,

This letter will serve as the response of Barnwell Industries,
Inc. ("Barnwell" or the "Company") to the comments received from the staff
(the "Staff") of the Securities and Exchange Commission by letter dated March
30, 2007.  To assist in your review, we have included the Staff's numbered
comments and have provided our responses below each comment.

ITEM 1.  BUSINESS
ESTIMATED FUTURE NET REVENUES

STAFF COMMENT:

1. We note your disclosure of the table calculating the present value of
   estimated future net revenues as of September 30, 2006.  Further, we
   note that you have calculated net revenues using current sales prices
   and costs, after deducting all royalties, operating costs, future
   estimated capital expenditures, and income taxes.  This measure does
   not appear to differ from the standardized measure that you have
   calculated and presented in accordance with SFAS 69.  As such, please
   revise the label to state standardized measure of estimated discounted
   future net cash flows.

MANAGEMENT RESPONSE:

The Company will revise the label to state "Standardized Measure of
Estimated Discounted Future Net Cash Flows."  We propose to make the
recommended change in our next Form 10-K filing.

<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS AND FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
CRITICAL ACCOUNTING POLICIES AND ESTIMATES

STAFF COMMENT:

2. We note that you have identified many areas of accounting that you
   regard as critical, due to the significant level of judgment required
   to determine various assumptions underpinning their application, and
   which under different conditions, could lead to "material differences"
   in your financial statements.  However, the disclosures that you provide
   appear to be essentially the same as the accounting policies utilized,
   rather than any specific uncertainties underlying your estimates.  In
   other words, not all of the critical accounting policies that you
   disclose appear to have critical judgment and estimation attributes,
   and for those that do, the disclosures do not sufficiently address such
   attributes.

   Please revise your disclosures to address the material implications of
   the uncertainties that are associated with the methods, assumptions
   and estimates underlying your critical accounting estimates.
   Specifically, you should provide the following:

     (a) An analysis of the uncertainties involved in applying the
         principle and the variability that is reasonably likely to
         result from its application.

     (b) An analysis of how you arrived at the measure and how accurate
         the estimate or underlying assumptions have been in the past.

     (c) An analysis of your specific sensitivity to change, based on
         outcomes that are reasonably likely to occur and have a
         material effect.

   Please refer to FRC Section 501.14 for further guidance.

MANAGEMENT RESPONSE:

We have reanalyzed our as-filed disclosure under the guidance of FRC
Section 501.14.  Based on the reanalysis, we have determined that our
as-filed disclosure would benefit from certain revisions.  Accordingly,
we propose a revised disclosure which provides improved focus and clarity
of those areas meeting the requirements of FRC Section 501.14, which states
that "When preparing disclosure under the current requirements, companies
should consider whether they have made accounting estimates or assumptions
where:

     - the nature of the estimates or assumptions is material due to the
       levels of subjectivity and judgment necessary to account for highly
       uncertain matters or the susceptibility of such matters to change;
       and

     - the impact of the estimates and assumptions on financial condition or
       operating performance is material.
                                  -2-
<PAGE>
"If so, companies should provide disclosure about those critical
accounting estimates or assumptions in their MD&A."  Our proposed disclosure
is as follows:

    Management believes the accounting policies that are most critical
    in assisting financial statement readers in understanding and
    evaluating our results due to their subjective judgments are as
    follows:

    -  Oil and natural gas properties - full cost ceiling calculation
       and depletion

       Policy Description

       We use the full cost method of accounting for our oil and
       natural gas properties, under which we are required to conduct
       quarterly calculations of a "ceiling," or limitation on the
       carrying value of oil and natural gas properties.  The ceiling
       limitation is the sum of 1) the discounted present value (at 10%),
       using prices as of the end of each reporting period on a constant
       basis, of Barnwell's estimated future net cash flows from
       estimated production of proved oil and natural gas reserves, less
       estimated future expenditures to be incurred in developing
       and producing the proved reserves but excluding future cash
       outflows associated with settling asset retirement obligations
       accrued on the balance sheet; plus 2) the cost of major development
       projects and unproven properties not subject to depletion, if any;
       plus 3) the lower of cost or estimated fair value of unproven
       properties included in costs subject to depletion; less 4) related
       income tax effects.  If net capitalized costs exceed this limit,
       the excess is expensed unless subsequent market price changes
       eliminate or reduce the indicated write-down in accordance with
       SEC Staff Accounting Bulletin Topic 12D.

       Judgments and Assumptions

       The estimate of our oil and natural gas reserves is a major
       component of the ceiling calculation, and represents the component
       that requires the most subjective judgments. Estimates of reserves
       are forecasts based on engineering data, historical data, projected
       future rates of production and the timing of future expenditures.
       The process of estimating oil and natural gas reserves requires
       substantial judgment, resulting in imprecise determinations,
       particularly for new discoveries.  Our reserve estimates are prepared
       annually by independent petroleum engineers and quarterly by
       internal personnel.  The passage of time provides more quantitative
       and qualitative information regarding estimates of reserves, and
       revisions are made to prior estimates to reflect updated information.
       In the past three fiscal years, annual revisions to our reserve volume
       estimates have averaged 2% of the previous year's estimate.  However,
       there can be no assurance that more significant revisions will not be
       necessary in the future.  If future significant revisions are necessary
       that reduce previously estimated reserve quantities, such revisions
       could result in a write-down of oil and natural gas properties.  If
       reported reserve volumes were revised downward by 5% at the end of
                                  -3-
<PAGE>
      fiscal 2006, the ceiling limitation would have decreased
      approximately $2,400,000.

      In addition to the impact of the estimates of proved reserves
      on the calculation of the ceiling, estimated proved reserves
      are also a significant component of the quarterly calculation of
      depletion expense.  The lower the estimated reserves, the higher
      the depletion rate per unit of production.  Conversely, the
      higher the estimated reserves, the lower the depletion rate per
      unit of production.  If reported reserve volumes were revised
      downward by 5% as of the beginning of fiscal 2006, depletion
      for fiscal 2006 would have increased by approximately $506,000.

      While the quantities of proved reserves require substantial
      judgment, the associated prices of oil, natural gas and natural
      gas liquids ("NGL") reserves, and the applicable discount rate,
      that are used to calculate the discounted present value of the
      reserves do not require judgment.  The ceiling calculation
      dictates that a 10% discount factor be used and that prices and
      costs in effect as of the last day of the period are held
      constant indefinitely.  Therefore, the future net revenues
      associated with the estimated proved reserves are not based on
      our assessment of future prices or costs.  Rather, they are based
      on such prices and costs in effect as of the end of each period
      for which the ceiling calculation is performed.

      Because the ceiling calculation dictates that prices in effect
      as of the last day of the applicable quarter are held constant
      indefinitely, and requires a 10% discount factor, the resulting
      value is not indicative of the true fair value of the reserves.
      Oil and natural gas prices have historically been volatile.
      Therefore, oil and natural gas property write-downs that result
      from applying the full cost ceiling limitation, and that are
      caused by fluctuations in prices as opposed to reductions to the
      underlying quantities of reserves, should not be viewed as absolute
      indicators of a reduction of the ultimate value of the related
      reserves.

    - Income taxes

      Policy Description

      Deferred income taxes are determined using the asset and liability
      method.  Deferred tax assets and liabilities are recognized for the
      estimated future tax impacts of differences between the financial
      statement carrying amounts of existing assets and liabilities and
      their respective tax bases.  Deferred tax assets and liabilities are
      measured using enacted tax rates in effect for the year in which those
      temporary differences are expected to be recovered or settled.  The
      effect on deferred tax assets and liabilities of a change in tax
      rates is recognized in income in the period that includes the
      enactment date.  A valuation allowance is provided when it is more
      likely than not that some portion or all of the deferred tax
      asset will not be realized.

                                  -4-

<PAGE>
     Judgments and Assumptions

     We make estimates and judgments in determining our income tax expense
     for each reporting period.  Significant changes to these estimates
     could result in an increase or decrease in our tax provision in future
     periods.  We are also required to make judgments about the
     recoverability of deferred tax assets and when it is more likely than
     not that all or a portion of deferred tax assets will not be realized,
     a valuation allowance is provided.  Changes in the assumptions regarding
     the realization of deferred tax assets could result in an increase or
     decrease in our income tax provision.  Furthermore, changes in our
     business performance could require a valuation allowance or a reversal in
     the valuation allowance in future periods.  The impact of any of
     these changes could be material.  Historically, our current income
     tax estimates have not materially differed from our income tax returns
     filed with taxing authorities.  However, there can be no assurance that
     material differences will not occur in the future.

     Barnwell has established a valuation allowance primarily for the U.S.
     tax effect of deferred Canadian taxes, accrued expenses and state of
     Hawaii net operating loss carryforwards which may not be realizable in
     future years as there can be no assurance of any specific level of
     earnings or that the timing of U.S. earnings will coincide with the
     payment of Canadian taxes to enable Canadian taxes to be a fully
     beneficial deduction for U.S. tax purposes.

     Canadian deferred tax assets related to expenses accrued for book
     purposes but not for tax purposes are estimated to be realized through
     future Canadian income tax deductions against future Canadian oil and
     natural gas earnings.  U.S. deferred tax assets related to expenses
     accrued for book purposes but not for tax purposes and the excess of
     the cost basis of investment in land for tax purposes over the cost
     basis of investment in land for book purposes are estimated to be
     realized from deductions against future U.S. earnings from sales of
     interests in leasehold land and land development rights.  Foreign tax
     credit carryforwards are estimated to be utilized when U.S. federal
     income taxes otherwise due on Canadian source income in a given year
     exceeds the foreign tax credit generated in that year.  The foreign tax
     credit carryforwards will expire if not utilized in fiscal years 2012
     through 2013.  The amount of deferred income tax assets considered
     realizable may be reduced if estimates of future taxable income are
     reduced.

   - Asset Retirement Obligation

     Policy Description

     Barnwell accounts for asset retirement obligations in accordance with
     SFAS No. 143, "Accounting for Asset Retirement Obligations," and FASB
     Interpretation No. 47, "Accounting for Conditional Asset Retirement
     Obligations - an interpretation of FASB Statement No. 143," which
     requires that the fair value of a liability for an asset retirement
     obligation be recognized in the period in which it is incurred if a

                                  -5-

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     reasonable estimate of fair value can be made.  Barnwell's estimated
     site restoration and abandonment costs of its oil and natural gas
     properties are capitalized as part of the carrying amount of oil
     and natural gas properties and depleted over the life of the related
     reserves.  The liability is accreted at the end of each period through
     charges to oil and natural gas operating expense.  If an obligation
     is settled for other than the carrying amount of the liability,
     Barnwell will recognize a gain or loss on settlement.

     Judgments and Assumptions

     The asset retirement obligation is recorded at fair value in the
     period in which it is incurred along with a corresponding increase
     in the carrying amount of the related asset.  Barnwell has estimated
     fair value by discounting the estimated future cash outflows required
     to settle abandonment and restoration liabilities.  The present value
     calculation includes numerous estimates, assumptions and judgments
     regarding the existence of liabilities, the amount and timing of cash
     outflows required to settle the liability, what constitutes adequate
     restoration, inflation factors, credit adjusted discount rates, and
     consideration of changes in legal, regulatory, environmental and
     political environments.  Abandonment and restoration cost estimates
     are determined in conjunction with Barnwell's reserve engineers based
     on historical information regarding costs incurred to abandon and
     restore similar well sites, information regarding current market
     conditions and costs, and knowledge of subject well sites and
     properties.  The process of estimating the asset retirement
     obligation requires substantial judgment and use