'File 14/15 Middle East Oil' [‎9v] (18/38)

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dcpoxiuont as it as upon oil for its wain source o* power, o/iu .o. nav.J. aaUiontios
approached the U.Secretary ff the Interior, ^.r. Icuos, vdth arguments m tav>ur - d
surpustion, A pipeline across Arabia, it w .s .j 7 w ued, ay^avoiding - 0 , d> c..nu exp^uo-tve
voya e round iirabia and through the Suo>, Canal, would bring oil mealy^ auu cheaply
to the Mediterranean area and Europe, t'ms facilitating marketing anu au uio saiue oU:.e
providing vaJ.ufole supply points for the bdS# Navy. ^ ^ 0
71. Influenced by the considerations, ana by the finamgs oi cue Peormeum
Co^ittee Secretary,lakes in early Pebruar W>k, sudd nly announced a proposal for an
jjijordcm pipeline to extend more than a thousand miles from the Bahrein-Kuwait ^il area
to the Eastern Mediterranean c*ast. The erfst, estur.ated at between on a ^1
miliJon pounds sterling would be assumed by the Petroleum Reserves Corporation (P.r^.;,
m A*..crican Govc-niuent Department Uorxleu by Mr. Ic.-,vs. • * n riel, one .!>•
G^verrm-ient would construct, own and maintain the line. The cost of construction plus
jnto-osc would bo returned to oh© Governreent by the companies concerned wiunin 25 year.,
to ether with a share m the prefits. In return the operating companies would unuer-
t .0 to infcJL* 1,000 million barrels of oil for. the naval m:-. unitary xorces
United States to be hole in reserve, avail;ble a- any time _for Gevera.en G purcuase a ^
?5 M below the ernket price in the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran. region. Finally, one ee- -.lee 1 s g ^
t .,) pipeline woula have to undertake not to sell petroleum . 'n, Gsyem ^ or
v,hen the ^Jerican Department judged such sales to be unwise in cue ox . .m.
forei n oelicy* . ...... , .gj -.. 4 .
72. The proposal raised storms of protest. The new project nad. oeon w xv: ;
under conditions of great secrecy md its sudden announcement J urso -xi^e 0O1 - 0 *
A<uericari Deoartment of State protested that the project would jeop. r^isc one success
Anp'lo-jvaericon negotiations for an oil agreement covering 0 he oruurly econou.iu ana
eauitable development and marketing of thuir o,l reserves on wmen ^
working. Rival American companies, particularly tnose en^ed xn soxling vu^ix j^xo-
ducts-on the European markets, protested violently against obis now snu uangerous
competitor and claimed that the figures of one xu^ax Report ^re incorreco ana mis-
leading. Isolationist critics claimed that the new pipeline would involve ^lenca xn
international complications and rivalries. Finally, the majority .01 -oho oxl inuuscry
in America damned the project as "Fascist", ana accusea S^ercm .1 y Ic..^^ ox b0
bring in Government ownership of the oil industry* a x a-r^ c-class 'u.iu-Cx.x xo./
developed, in face of which the project was te mporarily shelved ponaing ^n^io-^^rxean
negotiations on the whole question of post-war oil exploitation. On June ae it was
reported that the project had been abandoned in favour of a Governmenc loan 10 one oxi
companies to help thorns'to build the pipeline che..:selves.
73. In the meantime official discussion on oil questions had oeen opened op^/een
England and ^i.ierica, and finally, in Septa iber, 1945, the An, lo-A.erxcan Oil^ x a J
signed in London. Under the terms of tills treaty it was stipulated aic.G noon co'jntxies
would have equal facilities for oil exploitation in the kiddle Ease area.
74. Followin' this Treaty, the Arab ia-AMer lean Oil Company sec u , m 1945, - ^
subsidiary company, the Trans-Fabian Pipeline Ca, P any, to carry out cUnnecessary
preparations ana negotiations with a view to the eventual construction ox a .,x.poll .
across Fabia to the Meaiterranean coast. In January 1y46 concessions wexo ^ c ^
for the pipeline to cross Transjordan Used in three contexts: the geographical region to the east of the River Jordan (literally ‘across the River Jordan’); a British protectorate (1921-46); an independent political entity (1946-49) now known as Jordan and Pale seine to the sea. The ^ '', if ^
not specified. Haifa has been suggested but against this it is argued thao ^ Haila is
already the tern in us of the pipeline from Iraq, the port will eventually be too sm^l
to cope with all the shipping involved. On strategical considerations^ s ^ ^
objections to tor great a concentration m one area. It is
new pipeline, if constructed, might find a suitable term^us xurtuer faouou.
question has been left open to further study*