Concessions in Bahrein [Bahrain], Kuwait, &c: correspondence, 1932-Jul 1933 (Colonial Office Secret Print, Middle East No.49) [‎113v] (228/284)

200
18126/33 [No. 28].
No. 223.
MR. J. G. LAITHWAITE ( 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. )
to
MR. C. F. A. WARNER (Foreign Office).
(Copy received in Colonial Office, 1st February, 1933.)
(Confidential.) 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. ,
My dear Warner , Whitehall, S .W.I, 19th January, 1933.
We were much interested in the correspondence between Oliphant and Cadman
enclosed in your official letter of 14th January,* about the proposed Kuwait oil
concession. We are not, however, quite clear as to the precise nature of the
arrangement which Cadman has in view and while the discussions are apparently
still at a very early stage, and the Shaikh's decision as between the Eastern and
General Syndicate and the Anglo-Persian Oil Company will vitally affect matters, we
shall be very grateful for some further information about it.
2. The important point is the nature of the 50-50 basis which apparently figures
in the discussions. Does this mean merely that, in the event of the Shaikh deciding to
grant the Kuwait concession to the Anglo-Persian Oil Company, the Anglo-Persian
Oil Company and the Mellon group might reach an understanding under which
distribution of oil won from Kuwait would be on a 50-50 basis, the actual exploitation
of the concession remaining entirely in British hands? (If this is correct, consideration
might, I suppose, have to be given to the securing to His Majesty's Government of a
right of pre-emption over the whole supply in the event of war—though that is not
primarily an 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. point.)
3. Alternatively, is there any question in any circumstances of the Anglo-Persian
Oil Company contemplating—
(a) the concession ceasing to be under bona fide majority British control;
(h) the introduction of American personnel to develop the Kuwait concession,
or the transfer of exploitation of that concession to American interests?
4. As you will appreciate, after so much heavy weather has been made with the
bhaikh (and here) over the question of the concession and of safeguards, a very
embarrassing position might arise were we suddenly confronted with an understanding
between the Anglo-Persian Oil Company and the Americans the result of which would
be to make it necessary to ask the Shaikh's approval to the introduction of a really
effective American interest without his having any option to choose between competing
companies; and if there is any risk of this, it may be thought well to warn Cadman of
the possible difficulties well in advance.
5. I am sending copies of this letter to Starling and Moore.
Yours, &c.,
J. G. LAITHWAITE.
18126/33 [No. 29].
No. 224.
MR. J. G. LAll HWATTE ( 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. )
to
MR. K. W. BLAXTER (Colonial Office).
Mv ukar LIlaxter, Mia Office, London, S.W.I, 2nd February, 1933.
Many thanks for your letter of 1st Februaryt about Kuwait oil. We are not
entirely happy about the opening part of the draft telegram and we are particularly
anxious to avoid any misunderstanding on the part of the Resident. We would
therefore prefer, if you see no objection, to redraft it to run as follows : —
" Vou will have seen from the last paragraph of mv telegram No. 9 of 22nd
December} and from my private and personal telegram of 30th December? that we
had hoped that m fight of Petroleum Department memorandum and discussions
with you and Dickson Shaikh would have felt able to make earlv if not necessarily
immediate decision as between competing companies on broad view of financial and
* No. 210.
f No. 222-
t No. 198.
§ No. 206.