'File 82/1 II (F 53) A.P.O.C., and Oil Concession - Arab Coast' [‎277r] (559/576)

Serial No. 66. —Endorsement from H. M. Acting Vice-Consul, Bushire,
No. 306-S. of 1923, dated Bushire, the 22nd June (received 2nd
july) 1923.
Copy of the undermentioned papers is forwarded to the Government
of India in the Foreign and Political Department for information with
reference to telegram No. 1846, dated 18th May 1923, from the Secretary
of State for India to His Excellency the Viceroy.
0 ^fP atch ^ 0- 299-S., dated 20th June 1923 and accompaniments, to the Secretary
ot otate for the Colonies, regarding the Kuwait Oil Concession.
Enclo. to Serial No. 66.
From Lieut.-Col. S. G. Knox, Political Resident A senior ranking political representative (equivalent to a Consul General) from the diplomatic corps of the Government of India or one of its subordinate provincial governments, in charge of a Political Residency. in the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran.
and His Majesty's Consul-General for Ears, etc., to His Grace
the Duke of Devonshire, K.G., P.C., G.C.M.G. [Knight] Grand Cross of [the Order of] St Michael and St George (accolade). , GCVO Sec
retary of State for the Colonies, No. 299-S. of 1923, dated
Bushire, the 20th June 1923.
K mo ait Oil Concession.
My Lord Duke,
In the Secretary of State for India's telegram' No. 1846, of the 18th
May 1923, I was informed that His Majesty's Government wished me to
endeavour to secure from the Shaikh of Kuwait a definite undertaking
that he would give no oil concession to any other company than the D'Arcy
Exploration Company to which His Majesty's Government intended to
give preference over all other interests in Kuwait.
I now have the honour to forward to Your Grace a copy of a draft
agreement which was submitted to the Shaikh of Kuwait by Sir Arnold
Wilson with my approval; and a minute of a conversation on the subject
of that draft between Sir Arnold Wilson and the Shaikh at Kuwait on the
2nd June last.
The draft which was presented to the Shaikh differs considerably, Your
Grace will observe, from the separate agreements I was originally directed
to help the Company to negotiate; and principally in this that whereas
the present draft includes in one document exploration license, -prospecting
license and a definite lease for sixty years, my instructions w^ere merelv
to encourage the conclusion of the first two, and as to the third, to confine
myself to obtaining " an agreement to sign " ultimately such a lease. The
only object of that ' agreement ' being obtained now was apparently to safe
guard the Anglo-Persian Oil Company in the matter oi profits which the
Shaikh might endeavour to force up later on in the event of oil being found in
abundance; and it was no doubt the intention of His Majesty's Government
to leave over for subsequent consideration the other points which might
remain. But they apparently did not contemplate the drawing up now
of an exploitation lease in its final form.
The position has, however, materially altered since these instructions
were conveyed to me last November. The appearance in the field of the
Eastern and General Syndicate as an energetic and open rival of the
Anglo-Persian Oil Company in Arabia was a new factor in the situation
which encouraged the Shaikhs to play off one party against the other, and
generally undermined the position of the Anglo-Persian Oil Company.
Sir Arnold Wilson's desire in the circumstances to get the position of his
Company defined once and for all, and without more delay, seemed to me
entirely reasonable. In face of Major Holmes' active methods, it did not
seem to me to be a time for procrastination; and I believed that it would
accord with the views of His Majesty's Government that I should interpret
l xi—396.