The Royal Tar sailed from Sydney on July 16, 1893 with 220 colonials, planning to establish a utopian paradise in the Paraguay wilderness to be known as New Australia.
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A further 198 colonists were bound for South America in December, but by then about one-third of the original settlers had left Paraguay.
There was much discord and William Lane, the founder, left in May 1894 to found New Cosme about 20 miles away from New Australia.
William Lane lectured at Albury's Federal Theatre, Kiewa Street in April 1893, telling his audience that the aim was "to secure an opportunity to labour under freer and fairer conditions than those existing in Australia".
Lane's lecture was successful in enticing a group of Albury residents to join the adventure.
Fred Kidd (36), a Townsend Street bootmaker, left with wife Jane (32) and six children.
He was President of New Australia at one stage - the colony's banknotes were signed "F Kidd, El Presidente." The Kidds eventually settled in Argentina.
Arthur Brittlebank (50), a photographer based in Dean Street, was secretary of Albury's Single Tax League and a frequent letter-writer to newspapers.
Disgruntled with New Australia, he left and became active in the Transvaal Independent Labour Party.
George Blunden (37), a baker on the corner of Dean and Townsend streets, left with wife Amelia (30) and six children.
Family may have returned to Albury, as there was a H Blunden, baker and pastrycook advertising in Albury in 1947.
George Arthur (25), Albury bricklayer, eventually left Paraguay for South Africa and prospered as a bricklayer and master builder. He became mayor of a Johannesburg suburb.
Sidney Herbert (21) was a compositor with the Albury Banner. After leaving Paraguay he settled in New Zealand.
Daniel Pogson (50), bandmaster of Albury Town Band, left with wife Rebecca (30) and six children.
The family left Paraguay for England in 1896 and in 1908 Daniel returned to Albury via South Africa, again becoming bandmaster of the town band.
He died the next year and his son Percy took over as bandmaster.
A younger son, Les Pogson, became bandmaster of Albury Town Band in the 1940s.
James Allan and family went to Sydney, but did not board ship to South America, returning to Albury. Allan became Mayor of Albury in 1912.
Their son, Arthur, was headmaster of Albury High School for many years.
Several thousand New Australia descendants remain living in Paraguay today.
Many still celebrate their Australian origins on Australia Day.