File 1421/1908 Pt 1 'Persia: oil; D'Arcy Oil Syndicate' [‎325r] (171/218)

[This Document is the Property of His Britannic Majesty’s Government.}
PEKSIA.
[August 6 .]
CONFIDENTIAL.
Sectxqk 18,
[26038]
No. 1.
Sir C, Spring-Rice to Sir Edward Grey.—(Received August 6 .)
■y
(No. 151.)
Sir,
Gulahek, July 16, 19077
I VENTURE to express the opinion that the pessimistic view taken in the
communication from Sir H. D. Wolff—copy of which was forwarded to me in your
despatch No. 96 of the 1st ultimo—respecting the situation of the D’Arcy Oil Syndicate,
is not at present j ustified by the circumstances.
I will not trouble you with comments on the progress hitherto made with the
borings in South-Western Persia, as the Syndicate are themselves doubtless in possession
of more recent and accurate information on the subject than is available here. I am,
however, informed that up to the end of May no oil had been struck in the borings.
The statements contained in the last inclosure in your despatch under reply
(which I presume to he from Sir H. D. Wolff) do not appear to me to he borne out by
the facts of the case, and I beg to submit the following observations on the dangers
which the writer The lowest of the four classes into which East India Company civil servants were divided. A Writer’s duties originally consisted mostly of copying documents and book-keeping. represents as threatening the Syndicate.
It is true that the separate Agreement entered into by the concessionnaire and the
Bakhtiari Khans has not received the formal recognition of_ the Persian Government.
I do not, however, regard this as essential, nor as in any way invalidating the concession
granted by the Persian Government. I believe, moreover, that His Majesty’s Govern
ment share this view, and would be prepared to resist any attempt to declare the
concession invalid on these grounds. The point is a minor one, and any difficulties
raised would probably not be very serious : it remains to be seen how far Mr. Kitagji’s
influence with the Atabek will prove equal to compassing its removal^
I would further point out that the statement that the concessionnaire was bound by
the terms of the Agreement to begin remunerative work within two years of the grant of
the concession is not in accordance with the text of that instrument. The stipulation
was that the Company was to be formed within that period to exploit the concession
(Article XVI), a copy of its Statutes was to be deposited with the Persian Government,
after notification of its formation through the Imperial Commissioner, and 20,00(V. was
to be paid to that Government, and an additionol 20,000/. in paid-up shares (Articles IX
I am unable, after careful search, to find any document recording the fulfilment of
these conditions, except as to the payment of the stipulated sum, which was handed
over to M. Naus by the Atabek on his dismissal. (See Sir A. Hardinge s despatch
No. 149 of the 23rd September, 1903.) The subject is, after all, one that primarily
affects the Syndicate, and perhaps it might be advisable to obtain a definite statement
from them as to what steps have been taken to comply with the terms of the concession
in this respect, upon receipt of which, if necessary, a legal opinion might be invited as
to whether the Persian Government have any technical ground for cancelling the
concession.
I have, &c.
(Signed)
CECIL SPRING-RICE.
[2598/—18]