'File 82/1 [I] (F 52) A.P.O.C. and Oil Concessions Arab Coast' [‎69r] (137/307)

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SLO PERSIAN COMPAl^Y.
iisc/off . bhi mmi c house ,
GRETA T /INQESTER STREET.
LONDON, E.C.2.
51st l ay, 1922,
The Under Secretary of btati^
Colonial Ofhce,
London, S.W.I.
sir »
fe have the honour to refer to your letter No.13244/19
dated March 29th with reference to our application for prospecting
licences at Koweit and elsewhere.
2. We are pleased to note that ..r.Churchill is disposed to
concur in the view expressed in our letter of the 6th of January,
that the extent to which the Sheikhs concerned should participate
in the profits obtained under any exploitation lease subsequently
granted should be determined by an arrecmcnt accoramnyirvr the
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it
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and other conditions bein^ in accordance with the surrrestions
contained in paragraphs 3 and 4 of your letter under reply.
3. We note that, while it is not su/^rested that this
Apreeaent should include detailed conditions in refrard to such
exploitation lease, it is considered that it should provide for
the Sheikhs to have the ripht, acting under the advice of th»
Resident, to terminate the Concession in the event of failure on
our part to observe such workinr; conditions as may eventually be
agreed upon, or to produce adequate royalties. Tnis proviso we
are prepared to accept.
4. lith reference to para/scraphs 6 and 7 of your latter we
would urfre that in the case of i ^oweit the exploration and prospect
irv r licences should cover the whole area of :Coweit tern. to — --
has been agreed
territory for
map annexed to
The object of the tt Convention w made in 1913-14 with the
Sheikhs of Bahrein and Kowoit to which allusion is made in
paragraph 1 of your letter was, we understand, to prevent
comLierctal or other penetration by nationals of otner countries:
it would appear to us desirable to maintain this policy in the
present instance, for if we were to strike oil in paying
quariities. applications for licences would doubtless'be made by
others probably not British subjects, and it mipht be difficult for
His ..aiesty's'Government to bnn^; pressure to bear on the Sheikhs
to exclude foreigners under such circumstances, or even to impose
suitable conditions on them.
5. As regards the question of exploration fees we are
prepared to pay as you sorest an initial fee of Rs. 1.000 in both
cases, and a further sum of like amount in the case of Koweit
should the licence be extended for a further two years.
6., With reference to para/^aph 11 of your letter we undertak
that in the event of the concession bein^ (granted to our
subsidiary, the D , Arcy Exploration Company, in whole name it is
the intention that the concession should be applied for, the
British