'File 10/10 I Bahrain additional area' [‎10r] (19/136)

CQNFIDKNTIAL Political Agency An office of the East India Company and, later, of the British Raj, headed by an agent. ,
„ ^ Bohrain, tho 18th Sept^ber 1943.
No ,0/1244.
To
Th* Chi«f Local Reprssantativei
Th« Bahrain Petroltum Company Limlt«d f
Bahrain.
A
Dear Sir,
/
In accordrnc© with tW* request contained in vour
confidential letter No.C/PA-35j Jetted the 14th tairch 1943,
I addreased His Highness the Shaikh of Bahrain on the subject
of Article 5 of the "Deed of Further Modification dated the 19th
June 1940. •
2 * - informed His Highness of yeur Company's request that,
owing to cirnnmstanc*»s of wcr, he would agree to a formal mora
torium in respect of the Company's obligations under the article,
such mora Gorium to remain in effect ^so long as circumstances of
war last or until such time as reasonable normal Co/many operations
can be resu/iitd?.
3* I also informed His Highness of your Company 1 s request
that the Lease dated the 29th December 1934 as altered by the First
Supplemental Deed dated the 3rd June 1936 and by the Deed of Further
Modification dattd the 19th June 1940 should be extended by a period
equal to the period of the moratorium.
4. I further suggested to His H^hnena that, since the
Company had been compelled, owing to cdrcumstances of war, to
suspend exploration work since the autumn of 1942, the dnte from
which the formal moratorium should become onerative should not be
later than 1st December 1942. ^
S* I have now received a reply from His Fifhness in which
he states that he is willing to grant a moratoriun w for such time
as the war makes it impossible for the Company to carry out 5ts
obligations under Article His Highness explains that, in
granting a moratorium in these terms, he does not mean that the
moratorium shall necessarily extend until the end of the w^r, and
he expresses the hope that xxk before the war has come to an fnd
in all parts of the world conditions in the United States of
America and elsewhere — and especially shinping facilities — will
have improved to such an extent that the Company will be able to
resume its normal work in Bahrain.
6# His Highnasa agrees that the period of the moratorium
should commerce as from the 1st December 1942 and he Is willing
for the Lease dated the irth June 1940 to be extended by a period
equal to the period of the moratorium.
I reproduce verbatim the concluding paragraph of ITis
Highness* letter to me;-
M In this connection we should like to point out that the
war has added much to the cost of the administration of
our country ; in the interests of our people we have been
compelled to become the provider of our country* s food
stuffs and instead of being able to add to the State's
Reserve Fund we are using all available money for buying
supplies for the country. Cwing to the war we have had to
increase our armed forces to protect our oil fields. In
this t-nd in many other directions the war has been res
ponsible for increasing expenditure and at the same ti/
our/