SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934

[(Amendment No. ___)]

Filed by the Registrantx

Check the appropriate box:

Payment of Filing Fee (Check the appropriate box):

BARNWELL INDUSTRIES, INC.

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Notice of Annual Meeting of Stockholders

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To the Stockholders of

NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of BARNWELL INDUSTRIES, INC., a Delaware corporation, will be held on March 5, 2007,2, 2009, at 9:30 a.m., Central Standard Time, at the Clarion Shreveport Hotel, 1419 East 70th Street, Shreveport, Louisiana, for the purpose of considering and acting upon:

(1) Thethe election of a Board of Directors to serve until the next Annual Meeting of Stockholders and until their successors shall have been elected and qualified;

(2) the ratification of the selection of the independent auditor for 2009; and

(2) Any(3) any and all other business which may properly come before the meeting or any adjournment thereof.meeting.

Only stockholders of record at the close of business on January 8, 2007,5, 2009, are entitled to notice of and to vote at this meeting or any adjournment thereof. The Company’s Annual Report to Stockholders for the fiscal year ended September 30, 2006,2008, which includes consolidated financial statements, is enclosed herewith.

We will be pleased to have you attend the meeting. However, if you are unable to do so, please sign and return the accompanying Proxy in the enclosed addressed envelope.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MARCH 2, 2009. THE PROXY STATEMENT AND OUR 2008 ANNUAL REPORT ARE AVAILABLE AT HTTP://WWW.BRNINC.COM.

Dated: January 15, 2009

BARNWELL INDUSTRIES, INC.

1100 ALAKEA STREET, SUITE 2900

HONOLULU, HAWAII 96813

PROXY STATEMENT

SOLICITATION AND REVOCATION OF PROXIES

The following information is furnished in connection with the Annual Meeting of Stockholders of Barnwell Industries, Inc., a Delaware corporation (the “Company”), to be held on March 5, 20072, 2009 at 9:30 a.m., Central Standard Time, at the Clarion Shreveport Hotel, 1419 East 70^th Street, Shreveport, Louisiana.

The accompanying Proxy is solicited by the Board of Directors (the “Board” or the “Board of Directors”) of the Company, and theCompany. The Company will bear the cost of such solicitation. Solicitation of proxies will be primarily by mail. Proxies may also be solicited by regular employees of the Company by telephone at a nominal cost. Brokerage houses and other custodians, nominees and fiduciaries will be requested to forward soliciting material to the beneficial owners of Common Stock (as defined below) and will be reimbursed for their expenses. All properly executed proxies will be voted as instructed.

Stockholders who execute proxies may revoke them by delivering subsequently dated proxies or by giving written notice of revocation to the Secretary of the Company at any time before such proxies are voted. No proxy will be voted for a stockholder if the stockholder attends the meeting and elects to vote in person.

This Proxy Statement and the accompanying Formform of Proxyproxy are first being sent to stockholders on or about January 18, 2007.15, 2009. The Company’s website address is www.brninc.com.

VOTING AT THE MEETING

Only stockholders of record at the close of business on January 8, 20075, 2009 (the “Record Date”) will be entitled to vote at the annual meeting and any adjournment thereof. As of the Record Date, 8,169,0608,240,160 shares of common stock, par value $0.50, of the Company (the “Common Stock”) were issued and outstanding. Each share of Common Stock outstanding as of the Record Date is entitled to one vote on any proposal presented at the meeting. The election of directors and the ratification of KPMG LLP as our independent auditor for the fiscal year ending September 30, 2009 require a plurality of the votes cast at the meeting. With respect to abstentions, the shares will be considered present at the meeting for a particular proposal but since they are not affirmative votes for the proposal, theyand will have the same effect as a vote withheld onbe disregarded in the election of directors or a vote against such other proposal,and ratification of KPMG LLP as the case may be.our independent auditor. Brokers and nominees may be precluded from exercising their voting discretion with respect to certain matters to be acted upon, other than the election of directors.directors and ratification of KPMG LLP as our independent auditor. Thus, if you do not give your broker or nominee specific instructions, your shares may not be voted on these matters. A broker non-vote will not have any effect on any of the proposals. Shares represented by such broker nonvotes will, however, be counted for purposes of determining whether there is a quorum.

PROPOSAL NO. 1

ELECTION OF DIRECTORS

At the meeting, all elevenTen directors of the Company are proposed to be elected eachat the meeting. Each elected director toshall hold office until the next annual meeting and until his successor is duly elected and qualified. The persons named as proxies in the enclosed Proxy are executive officers of the Company and, unless contrary instructions are given, they will vote the shares represented by the Proxy for FORthe election to the Board of Directors of the persons named below. The election of directors will require a plurality of the votes cast at the meeting. The Board of Directors has no reason to believe that any of the nominees for director will be unable to serve; however, in the event any of the nominees should withdraw or otherwise become unavailable for reasons not presently known, the persons named as proxies may vote for other persons in place of such nominees.

Our Board of Directors recommends a vote FOR the election of the following ten directors of the Company.

DIRECTORS AND NOMINEES TO THE BOARD OF DIRECTORS

The Board of Directors held six meetings during the fiscal year ended September 30, 2008. All directors attended at least 75% of the meetings of the Board of Directors and of the committees of the Board on which each director served. The independent directors met on one occasion out of the presence of management during the fiscal year ended September 30, 2008.

The following table sets forth, as to the directors and nominees for election:election as directors: (1) such person’s name; (2) the year in which such person was first elected a director of the Company; (3) such person’s age; (4) all positions and offices with the Company held by such person; (5) the business experience of such person during the past five years; and (6) certain other directorships, if any, held by such person.

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^1.This director is independent as defined in Section 121(A) of the American Stock Exchange listing standards.

Board Nomination Process

The Board of Directors has a standing Compensation Committee, a standing Audit Committee, a standing Executive Committee and a standing ExecutiveReserves Committee. It has no standing nominating committee and there is no nominating committee charter. The Board of Directors believes that it is appropriate for the Company not to have a nominating committee because potential nominees are recommended to the full Board by a majority vote of the independent directors and each director on the Board of Directors participates in the consideration of all director nominees.directors. The Board identifies nominees by first evaluating the current members of the Board willing to continue in service. Current members of the Board with skills and experience that are relevant to the Company’s business and who are willing to continue in service are considered for re-nomination. If any member of the Board up for re-election at an upcoming annual meeting of stockholders does not wish to continue in service, the Board determines whether it is appropriate to replace the retiring member. If deemed appropriate, the Board identifies the desired skills and experience of a new nominee, if the Board determines that it is appropriate to replace the retiring member.nominee. The Board believes that potential directors should possess sound judgment, understanding of the business issues affecting the Company, integrity and the highest personal and professional ethics. In searching for potential Board nominees, theThe Board seeks directors who havepossessing a range of business, management and civic experience appropriate for the Board to discharge its responsibilities. In the case of both incumbent and new directors, the Board seeks persons who are able to devote significant time and effort to Board and Board committee responsibilities. Once nominees have been identified, the independent directors recommend to the Board such nominees and the Board reviews and votes on such recommendation.

The Board will consider potential nominees brought to its attention by any director or officer of the Company. It will also will evaluate recommendations for director nominees proposed by a stockholder who (i) has continuously held at least 1% of the outstanding shares of the Company’s Common Stock entitled to vote at the annual meeting of stockholders for at least one year prior to the date the stockholder makes the recommendation and (ii) undertakes to continue to hold such number of shares through the date of the meeting. Any recommendation for a director nominee submitted by a qualifying stockholder must be received by the Company no later than 120 days prior to the anniversary of the date proxy statements were mailed to stockholders in connection withfor stockholder proposals set forth herein under the prior year’s annual meeting of stockholders.heading “Stockholder Proposals.” Any stockholder recommendation for a director nominee must be submitted to the Company’s Chairman of the Board in writing including:and must include:

•     a statement by the stockholder that he/shesuch stockholder is the holder of at least 1% of the outstanding shares of the Company’s Common Stock, that the shares have been held for at least one year prior to the date of the submission and that thesuch stockholder will continue to hold the shares through the date of the annual meeting of stockholders;

•     the candidate’s resume, which will include a description of the candidate’s qualifications and business experience during, at a minimum, the last five years, including his/her principal occupation or employment and the name and principal business of any corporation or other organization in which the candidate was employed; and

The Board will evaluate recommendations for director nominees submitted by directors, management or qualifying stockholders in the same manner, using the criteria stated above. All directors and director nominees will submit a completed form of directors’ and officers’ questionnaire as part of the nominating process.

Stockholders may send any communication to the Board of Directors, as a whole, or individually, by mail to the Company’s address listed on page one of thethis Proxy Statement, to the attention of Russell M. Gifford, Secretary. All such communications will be forwarded to the Board of Directors or individual directors as appropriate.

The Company strongly encourages its directorseach member of the Board of Directors to attend the Annual Meeting. ThreeNine members of the Board of Directors attended the 20062008 Annual Meeting of Stockholders of the Company.Company, of which three attended in person and six attended by telephone.

COMPENSATION COMMITTEE

The members of the Compensation Committee are Mr. Hunter, Chairman, and Mr. Anderson, Dr. Gardner, Ms. Kranz and Ms. Kranz.Mr. Haspel. The Compensation Committee (i) determines the annual compensation of the Company’s senior officers; (ii) recommends, if appropriate, new employee benefit plans to the Board of Directors; (iii) administers all employee benefit plansplans; and (iv) makes such other determinations regarding compensation or benefits as may be necessary or advisable. DuringThe Compensation Committee held two meetings during the fiscal year ended September 30, 2006, the Compensation Committee held one meeting.2008, and has no charter.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

NAMED EXECUTIVE OFFICERS OF THE COMPANY

Mr. Johnston served as a memberThe Company currently has three executive officers. The following table sets forth the names and ages of all named executive officers of the Company, their positions and offices with the Company and the period during which each has served.

EXECUTIVE COMPENSATION

Summary Compensation Committee until December 8, 2006. Although Mr. Johnston is not independent as defined in Section 121 (A) ofTable

The following Summary Compensation Table sets forth certain information regarding compensation paid during the American Stock Exchange listing standards, the independent membersfiscal years ended September 30, 2008 and September 30, 2007 to (1) Morton H. Kinzler, our Chairman of the Board of Directors and Chief Executive Officer, (2) Alexander C. Kinzler, our President, Chief Operating Officer and General Counsel, and (3) Russell M. Gifford, our Executive Vice President, Chief Financial Officer, Treasurer and Secretary.

No named executive officer was granted a stock award in fiscal year 2008 or 2007. As a result, such column has been omitted.

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¹           Amounts reported as salary for each of Messrs. M. Kinzler, A. Kinzler and Gifford include amounts deferred. During the Company’s 2007 fiscal year, the Company determined that certain performance-based compensation earned by executives of the Company during the 2006 fiscal year and paid to them during the Company’s 2007 fiscal year did not qualify as “performance based” compensation under IRC Section 162(m). Consequently, in accordanceorder to permit the Company to take a tax deduction with respect to such compensation paid to the Company’s executive officers during the 2007 fiscal year, Messrs. M. Kinzler, A. Kinzler and Gifford each agreed to defer payment of his base salary (without interest) for the period from July 1 to September 30, 2007, until December 17, 2007. The Company’s executive officers were under no obligation to undertake such a deferral but did so in order to allow the Company to maximize its tax deductions.

²           The amounts included in the “Option Awards” column represent the compensation cost we recognized in each year for all stock option awards with respect to such executive officer, pursuant to Statement of Financial Accounting Standards No. 123(R). For a discussion of the valuation assumptions for 2008 figures, see Note 4 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended September 30, 2008.

³           We reflect our CEO’s and our President’s annual performance bonuses in the “Non-Equity Incentive Plan Compensation” column, which represent cash payments made in December 2008 for our CEO’s and our President’s 2008 performance under the 2008 Pay for Performance Plan (the “Plan”). The maximum bonus grant which could have been payable as calculated under the Plan was $1,162,500 as to our CEO and $975,000 as to our President. The Compensation Committee reduced the respective annual performance bonus amounts to be paid from the maximum which could have been payable to the amounts shown herein.

⁴           This amount represents perquisites received with respect to: (1) personal use of Company office; (2) medical expense reimbursements of $30,363; (3) club memberships; (4) companion air travel; (5) vehicle expense (including depreciation on a straight-line basis with a 7-year life); (6) in-office meals; and (7) supplementary retirement payments made pursuant to an agreement with the Company.

⁵           This amount represents perquisites received with respect to: (1) personal use of Company office; (2) medical expense reimbursement; (3) club memberships; (4) companion air travel; (5) vehicle expense (including depreciation on a straight-line basis with a 7-year life); (6) in-office meals; and (7) supplementary retirement payments made pursuant to an agreement with the Company.

⁶           This amount represents the compensation cost we recognized in fiscal 2008 pursuant to Statement of Financial Accounting Standards No. 123(R) as to a grant of 100,000 non-qualified options with stock appreciation rights on December 11, 2007, at a price of $12.92, the closing price of the Company’s shares on the American Stock Exchange listing standardson that Mr. Johnston, who is not an officer of the Company, brought a unique and valuable perspective to the Compensation Committee because of his real estate development experience and his opportunity to assess management’s capabilities due to his ownership interests in Kaupulehu Developments, the Company’s majority-owned real estate development general partnership.

No Director who served as a member of the Compensation Committee during fiscal year 2006 had any relationship requiring disclosure by the Company under Item 404 of Regulation S-K, except for Mr. Johnston. Mr. Johnston controls Nearco, Inc. Barnwell Hawaiian Properties, Inc., a wholly-owned subsidiary of the Company, owns a 50.1% interest in Kaupulehu Developments, and Cambridge Hawaii Limited Partnership, which is 55.2% indirectly owned by the Company, owns the remaining 49.9% interest in Kaupulehu Developments. In 1987, Barnwell Hawaiian Properties, Inc. and Cambridge Hawaii Limited Partnership agreed to pay to Nearco, Inc. 2% and 4%, respectively, of the cash consideration received from the sale of property owned by Kaupulehu Developments. Pursuant to these agreements, in fiscal 2006 Barnwell Hawaiian Properties, Inc. and Cambridge Hawaii Limited Partnership paid fees of $331,000 and $661,000, respectively, to Nearco, Inc. in connection with Kaupulehu Developments’ receipt of proceeds from real estate transactions. Also, Mr. Johnston received approximately $2,846,000 during fiscal year 2006, in respect of the 20.6% interest in Kaupulehu Developments he owns indirectly through certain entities that he controls, including Nearco, Inc. Nearco Inc. was also paid $76,000 in fiscal 2006 as a fee for real estate consulting services Nearco, Inc. performed for the Company.date. The Company believes such fees are fair and reasonable compensation for such services. In June 2006, the Company entered into an agreement with Nearco, Inc. to form Mauka 3K, LLC, for the purpose of providing real estate consulting services and investing in real estate. The Company and Nearco, Inc. each have a 50% voting interest in Mauka 3K, LLC. Mauka 3K, LLC received $3,000,000 in real estate consulting fees during fiscal 2006 of which Mr. Johnston received $1,440,000 in respect of the 50% interest in Mauka 3K, LLC he owns indirectly through Nearco, Inc.

During fiscal year 2006, none of our executive officers served on the compensation committee (or its equivalent) or board of directors of another entity whose executive officer(s) served on our Compensation Committee or Board of Directors, and no member of our Compensation Committee was an employee or former employee of the Company.

REPORT OF THE COMPENSATION COMMITTEE

Objective and Philosophy

The Compensation Committee’s objective is to implement a compensation program which attracts, retains and motivates highly qualified executive officers and management personnel who will enhance the Company’s annual performance and long term growth objective. This program is in part based on the belief that the interests of the executives should be closely aligned with the interests of the Company’s stockholders. The Compensation Committee attempts to achieve these goals by linking compensation to the accomplishment of specific results and the creation of value for the Company’s stockholders from both near-term and long-term performance perspectives. The Compensation Committee believes that cash compensation in the form of salary and incentive bonuses provides our executives with near-term rewards for completion of individual performance goals and

Company operations objectives and that long-term compensation through the award of stock options or other equity awards encourages growth in management stock ownership and gives management a stake in the Company’s long-term performance and success. The compensation committee considers all elements of compensation and these objectives when determining individual components of compensation packages.

Compensation Program Components

Currently, there are three principal components of the Company’s executive compensation program, annual base salary, near-term incentive compensation in the form of performance bonuses payable in cash on an annual basis and long-term incentive compensation in the form of stock options and stock appreciation rights. These programs are structured in accordance with the Compensation Committee’s objectives and philosophy.

Base Salary

Base salary levels for the Company’s executives are based on a variety of factors including scope of responsibility, performance and an assessment of competitive conditions in the marketplace for executives of comparable talent and experience. Base salaries for executives (other than the Chief Executive Officer) are generally recommended by the Chief Executive Officer for the review and approval of the Compensation Committee which makes a final determination based on the factors described above and the executives’ performance during the year and then submits its recommendation to the Board of Directors for approval. The Chief Executive Officer is not present during, and does not participate in, the voting or deliberations of the Board of Directors on his own compensation.

Near-Term Incentive Compensation

The short-term incentive compensation component consists of performance bonuses. The amount of any bonus is determined, in part, based on individual and corporate performance, the achievement of performance objectives and goals, the accomplishment of specific results and the creation of value for our stockholders. Bonuses paid to each executive are based in part on measuring which of these goals and objectives have been realized.

Long-Term Incentive Compensation

The long-term incentive compensation component consists of the Company’s 1998 Stock Option Plan (the “Qualified Plan”) under which executives may be granted stock options exercisable to purchase shares of Common Stock and occasional grants of non-qualified stock options with a stock appreciation right (“SAR”) component. Stock options granted under the Qualified Plan become exercisable in equal incrementsvest over four years and generally expire ten years from the date of grant. Non-qualified

⁷           This amount represents perquisites received with respect to: (1) medical expense reimbursement; (2) club memberships; (3) companion air travel; (4) vehicle expense (including depreciation on a straight-line basis with a 7-year life); and (5) imputed interest on a loan from the Company made prior to the enactment of the Sarbanes-Oxley Act.

⁸           This amount represents the compensation cost we recognized in fiscal 2008 pursuant to Statement of Financial Accounting Standards No. 123(R) as to a grant of 75,000 non-qualified options with stock options/SARs also are granted from time to time to key personnel, become exercisableappreciation rights on May 9, 2008, at a price of $11.40, the closing price of the Company’s shares on the American Stock Exchange on that date. The options vest over fivefour years and generally expire ten years from the date of grant.

Outstanding Equity Awards At Fiscal Year-End 2008

The deferred vesting provisionsfollowing table sets forth grants of stock options and grants of unvested stock awards outstanding on the last day of the fiscal year ended September 30, 2008 to each of the executives.

No named executive officer held unvested stock awards as of fiscal year end 2008. As a result, such columns have been omitted.

If a change in control occurs, then all unvested stock options are designed to reward long-term contributionswill accelerate and create an incentive for executives to remain withwill become exercisable in full. Assuming a change in control occurred September 30, 2008 and using the Company and create value for our stockholders. The Compensation Committee believes that granting stock options creates an incentive to promote the long-term interests of the Company and aligns the economic benefit to be obtained by the executives granted such options with thoseclosing price of the Company’s outside stockholders. Stock options are granted by the Compensation Committee to key employees basedstock on management’s recommendation, and levels of participation in the plan generally vary based on the employee’s position with the Company.

Compensation of our Chief Executive Officer

Our Company’s CEO, Mr. Morton H. Kinzler, was a founder of the Company and has been employed by the Company for over 50 years. His vast knowledge of the Company’s operational history and his experience in managing the Company from its inception has proved invaluable to the Company’s growth from an initial capitalization of approximately $2,000,000 to its present market capitalization in excess of $150,000,000. In evaluating his compensation, the Compensation Committee considers the same factors as described above for all officers (except that the Company’s executive management does not make salary recommendations for the Chief Executive Officer) and also considers Mr. Kinzler’s long-term commitment and contributions to the Company. For fiscal year 2006, the Compensation Committee approved a base salary for our Chief Executive Officer of $517,500, an increase of $97,000 over the prior year, reflecting the Company’s strong financial results and the

significant increase indate, the value of the accelerated vesting of these options would be $40,000 and $28,000, respectively, for each of Messrs. A. Kinzler and Gifford.

DIRECTOR COMPENSATION

The Company’s program of director compensation is intended to fairly pay directors for work required for a company of our size and scope. Directors who are not officers of the Company achieved duringreceive an annual fee of $15,000, are reimbursed for expenses incurred in connection with meeting attendance, and are offered medical coverage in the prior year. He received a bonus of $950,000 for fiscal 2006 also reflectingUnited States at the Company’s strong financial performance duringexpense. All such Directors other than Messrs. Hunter and Johnston did not wish to obtain such medical coverage and were paid an additional annual fee of $5,000. The Chairpersons of the prior year.Compensation Committee and the Reserves Committee receive an additional $12,000 annual fee and the Chairperson of the Audit Committee receives an additional $25,000 annual fee. The members of the Executive Committee, Reserves Committee and Compensation Committee, other than the Chairmen, receive an additional $2,500 annual fee. The members of the Audit Committee, other than the Chairperson, receive an additional $10,000 annual fee. Mr. Terry Johnston, a director of the Company, is also reimbursed for certain expenses incurred with respect to services he performs for Kaupulehu Developments and Kaupulehu 2007, LLLP, real estate partnerships which are majority-owned by the Company. In addition, Mr. Johnston receives fees for various services he and his affiliates perform for the Company other than in his capacity as a director, which are disclosed under “Certain Relationships and Related Transactions” below.

Tax ConsiderationsNon-Employee Director Compensation

In determining executive compensation, theThe following Non-Employee Director Compensation Committee considers, among other factors, the possible tax consequencestable sets forth information with regard to the Companynominees to the Board of Directors as listed in the table under “Proposal No. 1”, above, and to its executives. However, the Compensation Committee believes that it is important for it to retain maximum flexibility in designing compensation programs and therefore, while considering tax deductibility as one of its factors in determining compensation, will not limit compensation to those levels or types of compensation that will be deductible.

Compensation CommitteeMr. Terry Johnston, a member of the Board of Directors of the Company who is not standing for re-election, with regard to compensation paid to them during the fiscal year ended September 30, 2008. Directors who are officers of the Company do not receive any fees for their service as directors and their compensation as officers of the Company is disclosed in the Summary Compensation Table.

Alan D. Hunter, ChairmanNo named director was granted a stock award or option award in fiscal year 2008 nor earned any non-equity incentive plan compensation in fiscal year 2008. As a result, such columns have been omitted.

Martin Anderson

Murray Gardner

Diane Kranz

AUDIT COMMITTEE

The members of the Audit Committee are Ms. Kranz, Chairperson, and Messrs. Gardner, Anderson, Hunter, Takata and Takata.Haspel. All of the members of the Audit Committee are independent (as independence is defined in Section 121 (A) of the American Stock Exchange listing standards). The Board of Directors has determined that the Audit Committee has at least onetwo audit committee financial expert (as audit committee financial expert is defined in Item 407(d) of Regulation S-K),experts, Ms. Kranz and Mr. Haspel, who is aare both financial expertexperts based on hertheir being a certified public accountant.accountants. The Board of Directors has adopted a written charter for the Audit Committee, a copy of which was annexed to last year’s Proxy Statement and there has been no subsequent change in that charter.is available on our website. The Audit Committee reviews the services of the independent accountants employed by the Company to audit the consolidated financial statements of the Company. The Audit Committee periodically reviews periodically major issues regarding accounting and auditing principles and practices, the adequacy of internal controls that could affect the consolidated financial statements as well as all related party transactions and potential conflicts of interest. During the fiscal year ended September 30, 2006,2008, the Audit Committee held fivefour meetings.

REPORT OF THE AUDIT COMMITTEE

The Audit Committee has reviewed and discussed the audited consolidated financial statements with management, and the Audit Committee has discussed with KPMG LLP, the independent registered public accounting firm, the matters required to be discussed by Statement on Auditing Standards No. 61 (Codification of Statements on Auditing Standards, AU § 380), as such may be modified or supplemented. The Audit Committee has also received the written disclosures and the letter from KPMG LLP that are required by Independence Standards Board Standard No. 1 (Independence Standards Board Standard No. 1, Independence Discussions with Audit Committee) as may be modified or supplemented, and has discussed with KPMG LLP the independent registered public accounting firm’sits independence. Based upon its discussions with management and with KPMG LLP, the Audit Committee has recommended to the Board of Directors that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2006.2008.

Audit Fees

The aggregate fees billed to the Company by KPMG LLP, the Company’s independent registered public accounting firm, for professional services rendered in connection with the audit of the annual financial statements included in the Company’s Form 10-K, review of financial statements included in the Company’s Form 10-Qs and services to the Company in connection with statutory or regulatory filings or engagements for the fiscal year ended September 30, 20062008 totaled $334,500.$376,400¹. For the comparable services provided for the fiscal year ended September 30, 2005,2007, KPMG LLP billed the Company $211,600.$306,500.

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¹    The 2008 audit fees include $46,400 billed for 2007 audit fees which were not included in the 2007 estimated audit fees in our January 2008 proxy statement.

Audit-Related Fees

For the fiscal years ended September 30, 20062008 and September 30, 2005,2007, KPMG LLP, the Company’s independent registered public accounting firm, did not bill the Company for assurance and related services that are reasonably related to the performance of the audit or review of the Company’s financial statements.

Tax Fees

The aggregate fees billed to the Company by KPMG LLP, the Company’s independent registered public accounting firm, for tax compliance, tax advice and tax planning for the fiscal year ended September 30, 20062008 totaled $74,200$151,000 and for the fiscal year ended September 30, 20052007 totaled $71,100.$73,200.

All Other Fees

For the fiscal years ended September 30, 20062008 and September 30, 2005,2007, KPMG LLP, the Company’s independent registered public accounting firm, did not bill the Company for any fees other than Audit Fees and Tax Fees.

Pre-approval Policies and Procedures

The Audit Committee pre-approves anyall services provided to the Company by the independent registered public accounting firm through the following policies and procedures: (1) the Audit Committee reviews with the Company’s independent registered public accounting firm its audit plan and report thereon, including estimated Audit Fees, Audit-Related Fees, Tax Fees and Other Fees; (2) upon review of such audit plan and estimated fees, the Audit Committee may pre-approve the provision of such products and services and the payment therefor; and (3) at subsequent meetings of the Audit Committee, the Audit Committee reviews the status of the provision of all products and services from the Company’s independent registered public accounting firm to the Company and payment therefor, and may pre-approve the provision of additional products and services as necessary.

Audit Committee of the Board of Directors

Diane G. Kranz, Chairperson

Murray C. Gardner

Martin Anderson

Alan D. Hunter

Kevin K. Takata

Ahron H. Haspel

EXECUTIVE COMMITTEE

The members of the Executive Committee are Mr. Morton Kinzler, Chairman, and Messrs. Anderson, Hazelhoff-Roelfzema, Gardner, Alexander Kinzler, Johnston, Hunter and Johnston.Ms. Kranz. The Executive Committee has and may exercise all the powers of the Board of Directors when the Board is not in session, subject to certain limitations in the Company’s Bylaws. During the fiscal year ended September 30, 2006,2008, the Executive Committee held fourno meetings.

The Board of Directors held three meetings during the fiscal year ended September 30, 2006. All directors attended at least 75% of the meetings of the Board of Directors and of the Committees of the Board on which each of them served. The independent directors met on two occasions out of the presence of management during the fiscal year ended September 30, 2006.

EXECUTIVE OFFICERS OF THE COMPANY

The following table sets forth the names and ages of all executive officers of the Company, their positions and offices with the Company and the period during which each has served.

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EXECUTIVE COMPENSATION

Summary Compensation Table

The following summary compensation table sets forth the annual compensation paid or accrued during the last three fiscal years by the Company to the Chief Executive Officer and to executive officers whose annual compensation exceeded $100,000 for the fiscal year ended September 30, 2006 (collectively the “Named Executive Officers”):

Directors who are not officers of the Company receive an annual fee of $15,000 and are reimbursed for expenses incurred with respect to meeting attendance and are offered medical coverage in the United States at the Company’s expense. Any such director who does not wish to obtain such medical coverage is paid an additional annual fee of $5,000. The Chairman of the Compensation Committee receives an additional $12,000 annual fee. The Chairperson of the Audit Committee receives an additional $25,000 annual fee. The members of the Executive and Compensation Committees, other than the Chairmen, receive an additional $2,500 annual fee. The members of the Audit Committee, other than the Chairperson, receive an additional $10,000 annual fee. Mr. Terry Johnston, a director of the Company, is also reimbursed for certain expenses incurred with respect to services he performs for Kaupulehu Developments, a real estate partnership which is majority owned by the Company.

Aggregated Option Exercises in Last Fiscal Year

and Fiscal Year-End Option Values

The following table sets forth information related to the number of shares of Common Stock acquired during the fiscal year ended September 30, 2006 by the Named Executive Officers pursuant to the exercise of stock options, the value realized by the Named Executive Officers on exercise of such stock options and the number and value of unexercised stock options held by the Named Executive Officers at the end of the fiscal year ended September 30, 2006:

STOCK PERFORMANCE GRAPH AND CUMULATIVE TOTAL RETURN

The graph below compares the five-year cumulative total return, assuming the reinvestment of dividends, on Barnwell common stock with that of the AMEX Composite Index, the Dow Jones Exploration and Production Index and the Dow Jones Real Estate Holding and Development Index. This graph assumes $100 was invested on September 30, 2001, in each of Barnwell common stock, the companies in the AMEX Composite Index, the companies in the Dow Jones Exploration and Production Index, and the companies in the Dow Jones Real Estate Holding and Development Index.

Note: Stockholder returns shown in the graph below are based upon historical data and are not indicative of, or intended to forecast, future stockholder returns.

COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN*

AMONG BARNWELL INDUSTRIES, INC., THE AMEX COMPOSITE INDEX,

THE DOW JONES EXPLORATION AND PRODUCTION INDEX

AND THE DOW JONES REAL ESTATE HOLDING AND DEVELOPMENT INDEX

* $100 INVESTED ON 9/30/01 IN STOCK OR

INDEX-INCLUDING REINVESTMENT OF DIVIDENDS.

PENSION PLAN

Pension Plan Table

The following table shows estimated annual benefits payable at September 30, 2006, assuming retirement in 2006 at age 65 after selected periods of service, under the straight life annuity option of the Company’s pension plan. The benefits shown below include amounts to be paid pursuant to the Company’s pension plan, which is comprised of the Employee’s Pension Plan and the Supplemental Executive Retirement Plan. Covered compensation under the Company’s pension plan for Mr. M. Kinzler, Mr. A. Kinzler and Mr. Gifford includes “Salary” and “Bonus” as reported in the Summary Compensation Table, above. Since the maximum compensation recognized under the Plan is $315,000, the current covered compensation for each of the named executive officers is $315,000. Under each of the Employees’ Pension Plan and the Supplemental Executive Retirement Plan, a participant’s annual pension benefit at age 65 is equal to the product of (i) 0.9% of the participant’s compensation covered by the plan, plus 0.6% of that part, if any, of the average compensation in excess of such participant’s “social security covered compensation,” as defined in the plan, multiplied by (ii) such participant’s years of credited service, limited to 30 years. Plan benefits are not subject to any deduction for Social Security or other offset amounts. The benefits shown below are payable in the single life annuity form.

The Company maintains a pension plan for its eligible employees to provide annual benefits payable on retirement. Eligibility is based upon attainment of age 21 and completion of one year of service. Benefits are calculated under a formula based upon years of service and the participant’s highest average annual compensation over 60 consecutive months of service. The credited years of service as of September 30, 2006 for the Company’s Chief Executive Officer and each of the other executive officers named in the Summary Compensation Table and covered under the plans are as follows: Mr. Morton H. Kinzler--30, Mr. Alexander C. Kinzler--22 and Mr. Russell M. Gifford--25. Mr. Warren D. Steckley does not participate in the Company’s pension plan since, as an employee of Barnwell of Canada, Limited, Mr. Steckley participates in Canada’s public pension system. The years of eligible service for Mr. M. Kinzler take into account his years of association with the Company prior to the date of his formal employment pursuant to a deferred compensation agreement with him. The supplemental benefits Mr. M. Kinzler is to receive as a result of these additional years of eligible service is provided by the Company on an unfunded basis.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Below are the transactions that occurred during fiscal year 20062008 in which, to our knowledge, the Company was or is a party, in which the amount involved exceeded $60,000,$120,000, and in which any director, director nominee, executive officer, person known by us to be a holder of more than 5% of our common stockCommon Stock or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest.

Transactions with Mr. Johnston

Mr. Terry Johnston, a member of the Board of Directors of the Company who is not standing for re-election, has an interest in transactions with certain of the Company’s subsidiaries. Mr. Johnston controls Nearco, Inc. (“Nearco”) and the Company has entered into several transactions with Nearco.

Kaupulehu Developments

Barnwell Hawaiian Properties, Inc. (“Barnwell Hawaiian”), a wholly-owned subsidiary of the Company, owns a 50.1% interest in Kaupulehu Developments and Mr. Johnston owns indirectly through certain entities under his control a Hawaii real estate partnership, and19.3% interest. Cambridge Hawaii Limited Partnership a Hawaii limited partnership(“Cambridge Hawaii”), which is 55.2% indirectly owned by the Company, owns the remaining 49.9% interest in Kaupulehu Developments. Nearco, Inc. is a company controlled by Mr. Johnston. In 1987, Barnwell Hawaiian Properties, Inc. and Cambridge Hawaii Limited Partnership agreed to pay to Nearco Inc. 2% and 4%, respectively, of the cash consideration received from the sale of property owned by Kaupulehu Developments. Pursuant to these agreements, in fiscal 2006year 2008 Barnwell Hawaiian Properties and Cambridge Hawaii Limited Partnership paid fees of $331,000$116,000 and $661,000,$233,000, respectively, to Nearco Inc. in connection with Kaupulehu Development’sDevelopments’ receipt of proceeds from real estate transactions. Also, Mr. Johnston also received approximately $2,846,000$892,000 during fiscal year 2006,2008 in respect of the 20.6% interest in Kaupulehu Developments he owns indirectly through certain entities that he controls,under his control, including Nearco. Nearco Inc. Nearco Inc. was also paid $76,000$63,000 in fiscal 2006year 2008 as a fee for real estate consulting services Nearco Inc. performed for the Company.Kaupulehu Developments. The Company believes such fees are fair and reasonable compensation for such services.

Kaupulehu 2007, LLLP

In June 2006,January 2007, the Company entered into an agreement with Nearco Inc. to form Mauka 3K, LLC,Kaupulehu 2007, LLLP (“Kaupulehu 2007”), for the purposepurposes of providing real estate consulting services and investing in and developing real estate. TheKaupulehu 2007 is owned 80% by the Company and Nearco, Inc. each have a 50% voting interest in Mauka 3K, LLC. Mauka 3K, LLC received $3,000,000 in real estate consulting fees during fiscal 2006 of which Mr. Johnston received $1,440,000 in respect of the 50% interest in Mauka 3K, LLC he owns indirectly through Nearco, Inc.20% by Nearco.

In June 2008, with the agreement of Kaupulehu 2007, two lots which Kaupulehu 2007 had the right to acquire for $2,378,000 each were sold to an independent third party for $2,600,000 each by WB-KD, LLC, an independent third party developing the property, and Nearco was paid $26,560, amounting to 6% of the revenue received by Kaupulehu 2007 in the transaction, as a reasonable fee for services rendered by Mr. Johnston to facilitate the transaction.

During fiscal 2008, Kaupulehu 2007 paid Nearco $93,749 for services rendered as project manager for the construction of homes on two of the lots owned by Kaupulehu 2007, pursuant to an agreement entered into in December 2007.

Kaupulehu Investors, LLC

Kaupulehu Investors, LLC is owned 80% by the Company and 20% by Nearco.

Transactions with Ms. Grillot

Ms. Cynthia Grillot, a daughter of Morton H. Kinzler, Chief Executive Officer and Chairman of the Board of the Company, and sister of Alexander C. Kinzler, President, Chief Operating Officer, General Counsel and a Director of the Company, was employed as an assistant vice president and marketing manager of Barnwell of Canada, Limited, a subsidiary of the Company, in fiscal year 2006, and she received fiscal year 20062008 compensation of the Canadian dollar equivalent of U.S. $115,200.U. S. $188,533, which includes $68,350 in compensation received as the result of the exercise of rights under a long term incentive compensation plan.

Transactions with Drs. Sudarsky and Magaro

Dr. R. David Sudarsky and Dr. Joseph E. Magaro each of whom are persons known by the Company to be holders of more than 5% of the Company’s common stock,Common Stock. Dr. Sudarsky and Dr. Magaro are working interest owners in certain oil and gas properties managed by the Company and in which the Company also holds a working interest. As owners of up to 11.875% and 10.5%11.03%, respectively, of the working interest in these properties, they are required to pay their proportionate share of costs and are entitled to receive their proportionate share of revenues in the normal course of business from these properties. During fiscal year 2006,2008, Dr. Sudarsky and Dr. Magaro earned revenues from their working interests in these properties, net of costs, of approximately $2,430,000$2,577,000 and $1,784,000,$1,916,000, respectively.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information as of December 27, 2006,5, 2008, with respect to the beneficial ownership of the Common Stock, the sole voting security of the Company, by (i) each person known to the Company who beneficially owns more than 5% of the Common Stock, (ii) each director and nominee of the Company, (iii) the Named Executive Officersnamed executive officers, and (iv) all directors and executive officers of the Company as a group.

____________________

PROPOSAL NO. 2

RATIFICATION OF THE SELECTION OF THE INDEPENDENT AUDITOR FOR 2009

The Audit Committee has appointed KPMG LLP to serve as our independent auditor for fiscal year 2009. KPMG LLP has served as the Company’s independent auditor since 1990 and is considered by management to be well qualified. Although stockholder ratification of the Audit Committee’s appointment of KPMG LLP as our independent auditor is not required, the Board of Directors is submitting the appointment of KPMG LLP to the stockholders for ratification. If the stockholders fail to ratify the Audit Committee’s appointment, the Audit Committee will reconsider whether to retain KPMG LLP as the Company’s independent auditor. In addition, even if the stockholders ratify the appointment of KPMG LLP, the Audit Committee may in its discretion appoint a different independent accounting firm at any time during the year if the Audit Committee determines that a change is in the best interests of the Company. Ratification of the selection of the independent auditor requires a plurality of the votes entitled to be cast by the stockholders present or represented and entitled to vote on this matter at the Annual Meeting. We are asking our stockholders to ratify the selection of KPMG LLP as our independent auditor for fiscal year 2009.

Our Board of Directors recommends a vote FOR the ratification of the selection of KPMG LLP as independent auditor for fiscal year 2009.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s officers and directors, and persons who own more than 10% of a registered class of the Company’s equity securities, to file reports of beneficial ownership on Forms 3, 4, and 5 with the Securities and Exchange CommissionSEC and any national securities exchange on which such equity securities are registered. Based solely on the Company’s review of the copies of such forms it has received and written representations from certain reporting persons that they were not required to file reports on Form 5 during the most recently completed fiscal year or prior years, the Company believes that all of its officers, directors and greater than 10% beneficial owners complied with all Section 16(a) filing requirements applicable to them during the Company’s most recently completed fiscal year, except as follows: Ms. Diane G. Kranz,that one Statement of our directors,Changes of Beneficial Ownership on Form 4, representing three transactions, was filed a late Form 5; and Mr. Warren D. Steckley filed a Form 3 during the most recently completed fiscal year, because Mr. Steckley did not file a Form 3 at the time he was appointed an executive officeron behalf of the Company in 1998. Mr. Steckley held no reportable securities at the time he was appointed an executive officer.Alexander C. Kinzler.

SELECTIONCODE OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMETHICS

The Board of Directors of the Company has appointed KPMG LLP asadopted a code of ethics that applies to all of our executive and non-executive employees. The code of ethics contains certain additional terms applicable to our Chief Executive Officer and Chief Financial Officer. The Company’s code of ethics may be found on the independent registered public accounting firm to audit the accounts of the Company for the year ending September 30, 2007. This firm expects to have a representative available by telephone at the meeting who will have an opportunity to make a statement if he or she desires to do so and will be available to respond to appropriate questions.Company’s website at: www.brninc.com/ethics0304.pdf.

STOCKHOLDER PROPOSALS

Any Stockholder who, in accordance with SEC Rule 14a-8, wishes to present a proposal for inclusion in the proxy materials to be distributed in connection with the next Annual Meeting of Stockholders must submit the proposal so that it is received at the principal office of the Company no later than September 20, 2007.16, 2009. As the SEC rules of the SEC make clear, simply submitting a proposal does not guarantee that it will be included.

In addition, for proposals that are not timely submitted for inclusion in the proxy materials, the proxy solicited by the Board of Directors for the next Annual Meeting of Stockholders will confer discretionary authority upon management’s proxy holders to vote on

Notices of intention to present proposals at the next Annual Meeting of Stockholders should be addressed to Secretary, Barnwell Industries, Inc., 1100 Alakea Street, Suite 2900, Honolulu, Hawaii 96813. The Company reserves the right to reject, rule out of order, or take other appropriate action with respect to any proposal that does not comply with these and other applicable requirements.

GENERAL

No business other than those set forth in ItemItems (1) and Item (2) of the Notice of Annual Meeting of Stockholders is expected to come before the meeting, but should any other matters requiring a vote of stockholders properly arise, including a question of adjourning the meeting, the persons named in the accompanying Proxy will vote thereon according to their best judgment in the best interests of the Company.

Insofar as any of the information in this Proxy Statement may rest peculiarly within the knowledge of persons other than the Company, the Company has relied upon information furnished by such persons.

By Order of the Board of Directors,

Dated: January 15, 2009

Stockholders may obtain a copy, without charge, of the Company’s Annual Report on

Form 10-K, as filed with the Securities and Exchange Commission, by writing to Russell M. Gifford, Barnwell Industries, Inc., 1100 Alakea Street, Suite 2900, Honolulu, Hawaii 96813 or by sending an email to brn1@brninc.com or by following the “SEC Filings” link at the Company’s website (www.brninc.com).