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'D.178 86/13-III KUWAIT NEUTRAL ZONE' [228r] (455/602)
The record is made up of 1 file (300 folios). It was created in 24 Nov 1946-3 Jun 1948. It was written in English. The original is part of the British Library: India Office The department of the British Government to which the Government of India reported between 1858 and 1947. The successor to the Court of Directors. Records and Private Papers.
Transcription
This transcription is created automatically. It may contain errors.
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Ext. r )S 0 A 8
SECRET
d&dS 4
Commonwealth Relations Office,
Downing Street,
Whitehall,
London, S.W.l*
,!) r.^arch, I9Z18.
At a recent inter-depe.rtmental meeting with the Ministry of Fuel
and Power and the Foreign Office the position regarding bids for the
petroleum rights in the Koweit Neutral Pone was reviewed and the
question whether it would be desirable to try to influence the Sheikh
in favour of a particular oil company or group of companies was
specially considered.
^ v<iS generally felt that the increase in the bidding was such
thc't the large sums involved might soon be incommensurate with the
oil prospects of the area.' There mgy however be companies having as
yet no concessions in the Middle East which may still wish to raise
the stakes; and clearly N.N.G. is not in a position to influence the
/merican companies in deciding how much they are prepared to offer^
■■ ..c should be interested to know whether you consider it likely that the
j Sheikh may close the bidding at an early date or prolong the auction
I for an undefined period.
3 « The latest definite bid of whi-ch wc have information is that of the
Amerada Petroleum Corporation, which offered an initial payment of
£ 3 A million, a minimum annual payment of # 500 r 000 and a royalty of 25
cents per barrel, have recently heard that if Amerada succeed in
gaining the concession, it will be joined by the Continental Oil Company
and the Seaboard Oil Company, both of which have been successful in
their operations in U.S.A. Fe are advised that Amerada, in conjunction
v/ith^the other two companies, would make a strong team and have
sufiicient assets, knowledge and ability to make a success of developing
the concession.
/+• Fe do not know whether Gulf Oil Corporation intend to advance its
latest 01f«r. However, as you are aware, it has been mutually agreed
between the Anglo-Iranian Oil Company and the Corporation that if.
exther of them should obtain Kowoit♦s rights in the Neutral Zone it
would share them equally with the other. For the present the A.I.O.C.
are debarred from bidding even as an equal partner with the Gulf Oil
Corporation in the Koweit Oil Company. This•position may alter when
*'^ -Line Agreement is revised, negotiations regarding which are still
proceeding, though it appears unlikely that any settlement will be
reached for three or four months at the earliest.
_5 • By the time you receive this letter you will no doubt have seen
Abraham, who will have explained to you the Burmah Oil Company’s
intention to increase its previous bid and its readiness to go up to
£ 1 , 000 , 000 . Before leaving here Abraham remarked that, if unsuccessful,
he would, after his return to the U.K., probably approach Gulf with the
object of endeavouring to arrange a tripartite agreement between Gulf,
A.T.O.C., and B.O.C., with the purpose of acquiring jointly the Koweit
share of the rights in the Neutral Zone. We have no indication whether
A.I.O.C. and. Gulf would look favourably on this grouping of companies,
v.’hich as far as we are concerned would seem quite a good arrangement.
Fe/
Lt. Col. Sir R. Hay, K.C.I.E., C.S.I.,
Persian Gulf
The historical term used to describe the body of water between the Arabian Peninsula and Iran.
Residency
An office of the East India Company and, later, of the British Raj, established in the provinces and regions considered part of, or under the influence of, British India.
,
Bahrein.
c
A/O
582
0A IE.... /0 3 . ’4 A
CONF1DI
About this item
- Content
The file contains correspondence between the 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. (William Rupert Hay); the Political Agent A mid-ranking political representative (equivalent to a Consul) from the diplomatic corps of the Government of India or one of its subordinate provincial governments, in charge of a Political Agency. at Kuwait (Gordon Noel Jackson, Maurice O’Connor Tandy); the India Office The department of the British Government to which the Government of India reported between 1858 and 1947. The successor to the Court of Directors. (later the Commonwealth Relations Office, Eion Pelly Donaldson, Adrian Harbottle Reed, Ralph Ingham Hallows); the Foreign Office (Lancelot Frank Lee Pyman); the Ministry of Fuel and Power (William Dunmore Monsell-Davies); His Majesty’s Minister at Jedda (Alan Charles Trott); the Shaikh of Kuwait (Shaikh Aḥmad al-Jābir Āl Ṣabāḥ) and various oil companies in relation to the auction process instituted by the Shaikh of Kuwait for his share in the Kuwait-Saudi Arabia Neutral Zone oil concession.
The companies which expressed an interest in bidding for the Kuwait neutral zone concession included Petroleum Concessions Limited, the Burmah Oil Company, the Eastern Gulf Company, the Amerada Petroleum Company, the American Independent Petroleum Corporation, the Superior Oil Company of California and the Canadian Eagle Oil Company. However owing to the Shaikh's requirement that financial backing and resources to undertake exploitation of an oil concession are proven by each potential bidder only four companies were permitted to continue and submit final bids on 1 June 1948 – Petroleum Concessions Limited, the Burmah Oil Company, the Eastern Gulf Company and the American Independent Petroleum Corporation.
Other matters discussed in the file include:
- the question of the political agreement between His Majesty’s Government and successful Oil Company and discussing whether such an agreement could be made with an American Company and also what changes and special requirements would have to be made owing to the concession only being for the Shaikh of Kuwait’s share of the neutral zone.
- a visit paid by the Shaikh of Kuwait to Ibn Saud (‘Abd al-‘Azīz bin ‘Abd al-Raḥmān bin Fayṣal Āl Sa‘ūd)and the question of whether or not the neutral zone was discussed by them.
- debate around the possibility of a geographic division of the neutral zone in order to make administration of the zone easier, and the conclusion that negotiations for such a division could take years and would not perhaps be in the best interests of the Oil Companies exploiting an oil concession there.
- a hydrographic survey of the coast-line of the neutral zone to locate a suitable landing site for heavy equipment.
- a new air service instituted by Iraq Airways in 1947 that would fly from Basra to Kuwait and Bahrain.
A series of file notes which were maintained as a record of the correspondence in the volume can be found at folios 272-299.
- Extent and format
- 1 file (300 folios)
- Arrangement
The papers are arranged in approximate chronological order from the front to the rear of the file.
- Physical characteristics
Foliation: the main foliation sequence (used for referencing) commences at the front cover with 1 and terminates at the back cover with 302; these numbers are written in pencil, are circled, and are located in the top right corner of the recto The front of a sheet of paper or leaf, often abbreviated to 'r'. side of each folio. An additional foliation sequence is also present in parallel between ff 2-99 and ff 113-300; these numbers are also written in pencil, but are not circled, and are located in the same position as the main sequence.
- Written in
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'D.178 86/13-III KUWAIT NEUTRAL ZONE' [228r] (455/602), British Library: India Office Records and Private Papers, IOR/R/15/1/687, in Qatar Digital Library <https://www.qdl.qa/archive/81055/vdc_100029106993.0x000038> [accessed 10 May 2024]
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Copyright: How to use this content
- Reference
- IOR/R/15/1/687
- Title
- 'D.178 86/13-III KUWAIT NEUTRAL ZONE'
- Pages
- front, front-i, 2r:58v, 60r:77v, 80r:85v, 87r:90v, 94r:95v, 97r:97v, 99r:159v, 161r:185v, 188r:226v, 228r:229v, 231r:259v, 261r:267v, 270r:300v, back-i, back
- Author
- East India Company, the Board of Control, the India Office, or other British Government Department
- Usage terms
- Open Government Licence