'File 14/115 VII Annex (B 9) Abu Musa oxide: collected background material on the case' [‎64r] (138/1904)

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cegotiatrng with the Porte for the lease of the little-known Island of Halool in the
Persian Gult, with tne mea ol placing a coaling dep6t there.
As tending n show that the report might have some foundation, it was remarked
that curiously ^enough Halool was the only one among the numerous islets in the Gulf
to wtncn turkey could conceivably base a colourable claim, from the fact that the
mamlanu nearest to the island was the coast of Katar, on which the Porte keep a
small gamson (at A1 Bida), though we have always declined to recognise their iuris-
diction there. ' o J
I understaiia that^ any such design as that suggested was denied by the German
press 01 Government ; m any case, the publicity given to the matter had the effect of
nipping any possible intrigue in the bud.
A tew weeks^aiter the above incident, news was received of the grant by Hassan
feamaiyeh to the German firm of an exclusive contract in connection with the Abu Musa
oxide concession.
co ^ amumca twig the facts, as far as they were then known, to the Government
of India, I expressed the view that the grant of a monopoly without limit of time gave
the bheikh of Shargah reasonable grounds for withdrawing the concession, and that
althougn the Abu JVxusa oxide might not prove to be of great commercial value, it was
politically important to prevent the creation by Germany of vested interests in the
Gulf, sucn as this oxide monopoly might prove to be. The Government of India were
L | ie same opinion, ana, apart from the commercial aspect of the question, took count
of the fact that where oxide could be conveniently stored and shipped, there coal could
be handled with equal facility.
•A- 8 a matter ot tact, the contingency of Germany acquiring a coaling station in the
Gulf and her right to do so if she wished were frankly alluded to in the German press
in connection with this dispute (vide Berlin Embassy despatch No. 553, dated the 27th
December, 1907).
I would emphasise the fact that there was never any desire altogether to prevent
the German firm from trading in Abu Musa oxide in competition with others. All that
was objected to was the acquisition by Wonckhaus of a monopoly and of rights in the
mines themselves; and these latter rights they claimed. It was with the idea of
preventing these two possible contingencies that the Sheikh of Shargah. on learning the
state ot the case, decided to cancel the concession. He was the more inclined to do
this by the fact that he had already nearly lost the island on a previous occasion
through the^ action of the Belgian Director of Persian Customs at Bushire, who had
endeavoured to hoist a flag and instal a customs post there on behalf of the Persian
Government.
_ The grounds which the sheikh put forward in intimating to Hassan the cancellation
ot tne lease were fcnat the nature of the contract given to AV onckhaus involved a
monopoly. It was consequently such as he had no right to give, at all events without
first consulting himself (the ruling Sheikh of Shargah) and the third partner, Esa;
that the said partner did not agree ; and that he himself objected to the nature of the
contract.
Phase II.— The original German Statement 31, 1907.
It is to bfe noted that before presenting their claim to us on behalf of Wonckhaus
the German Government apparently attempted to get the Persian Government to claim
sovereignty over the Island of Abu*Musa.
The salient issues raised in their claim were :—
Issue (a). —That the mines were owned by Sheikh Salim personally and had been
leased by him in his own right.
Issue (5).—That the concession had been approved by the ruling Sheikh of
Shargah, and that the terms of it were such that the latter had no power to
cancel it.
Issue (c).—That the subsidiary contract of the 1st June, 1906, for the sale of oxide
passed by Hassan to W onckhaus did not require the sheikh's approval.
Issue(d). —That the said contract had the approval of the third partner, Esa.
Issue (e).-—That the sheikh's illegal action had injured Wimckhaus, not only as
buyer of oxide, but as partner in the mining concession, they having purchased a
share in it. In the latter capacity the German firm claimed compensation, not from
the Concessionnaires, but as one of the concessionnaires from the Sheikh of Shargah.