File 3877/1912 Pt 2 ‘Turkey in Asia: oil concessions’ [‎91r] (190/308)

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mrnmmmmmmmtitm
(Con
Sir,
you addressed on the 9th ultimo to the Board of Trade, and the records of the various
interviews which you and your co-directors of the Anglo-Persian Oil Company have
had at that Department on the subject of the Mesopotamian oil concession.
In your letter of the 9th December you indicate the following four conditions as
ottering the only basis upon which a 50 per cent, participation would afford the
Anglo-Persian Oil Company a sufficient amount of protection : —
1. That a syndicate to prospect and test the Mesopotamian fields he formed with
a capital of 100,000Z. (or, if necessary, 200,0001), 50 per cent, of the capital of which
would be taken by the Anglo-Persian group and 50 per cent, by the Turkish Petroleum
Company.
hhat the members of this syndicate shall undertake to form a working company
with a capital of not less than 1,000,000L should they be satisfied with the examination
of the fields, the capital of such company, if so desired by any member, to be raised
by a public issue of debentures and/or shares.
3. That the chairman of such syndicate and/or company shall always be nominated
by us, and shall have a casting vote, the other members of the board being nominated
half by us and half by the foreign group.
4. That the firm of Strick, Scott, and Co. (Limited), of Bagdad, shall be appointed
the permanent managing agents of the syndicate and/or company in Turkey.
You are already aware that, since the recent decision of the National Bank of
Turkey to disinterest itself in the Turkish Petroleum Company, the Board of Trade
have had prolonged and detailed discussions with Herr Stauss, representing the
Deutsche Bank group of that company, and that they have been in communication
with Mr. Detterding, as representing the Anglo-Saxon group, regarding the settlement
of this complicated question.
The Board of Trade have ascertained that, as regards the third and fourth
conditions laid down in your letter, there is no prospect whatever that anything
His Majesty’s Government could do would induce either of the groups to go beyond
the proposals already communicated to you at the conference which took place at the
Board of Trade on the 28th November.
Sir E. Grey considers, however, that those proposals do in fact offer a reasonable
solution of a very difficult problem, and should satisfy Mr. D’Arcy’s equitable claims;
and he can hold out no hope of obtaining better terms.
The German interests concerned always had certain indisputable claims under the
Bagdad Railway Convention of 1903; their claims are based upon a formal convention,
those of Mr. D’Arcy upon an oral assurance of later date, of which no record exists in
the archives of the Ottoman Government. While His Majesty’s Government have been
anxious to secure the best possible terms for Mr. D’Arcy, they are of opinion that the
provisions of the above convention do in effect debar him from any claim to a
monopoly to the oil wells in the vilayets of Mosul and Bagdad, and that the only
possible settlement of this question is by arrangement with the Germans. Moreover,
a stage has now been reached in the general negotiations with Germany and Turkey
which renders it essential that the Mesopotamian oil question, which is one of the few
outstanding points in those regions, should also be settled.
Both therefore on general grounds, and in view of the equitable solution which the
settlement proposed appears to His Majesty’s Government to offer to Mr. DArcy, I am
to request that you will be so good as to inform Hip Majesty’s Government at an early
date whether the group which you represent are willing to enter into an arrangement
on the terms which have been communicated to them, or would prefer to stand out of
the Mesopotamian concession altogether, these being, in Sir E. Grey s opinion, the only
alternative courses.
I am, &c.
W. LANGLEY.