Coll 30/124A 'Koweit (Neutral Zone) Oil Concession: Negotiations with Petroleum Concessions Ltd.' [‎11r] (21/883)

Bank at Basra that *hen a concession w a s granted the Shaikh
would ask for payment to be made m dollars. Abdullah
Mullah also told another bank manager that the Shaikh w a s
likely to favour the American independent Oil Company owing
to the large dollar payments they had offered. This may be
one of the points that the Shaikh is leaving for settlement
until the auction is completed c.f. paragraph 3 above and if
it is considered a vital one x would suggest that Abraham
might be prompted to make enquiries about it.
7. In your paragraph 7 you enquire whether any diffi
culty would be likely to arise from competition for labour
if two con^ames in iuiwait and the neutral £one were expanding
their operations simultaneously. As I have pointed out m
paragraph 5 above the Kuwait Oil Company should almost have
reached the limits of their expansion before the neutral ^one
Company can begin. in any case i do not think the situation
would oe worse tnan it is at present wn.en there is great
competition for labour in Kuwait, Bahrain and Qatar and at
various places on the mainland owing to the ever expanding
activities of the various oil companies and the construction
of the Trans Arabian pipe-line. in fact the situation may
well improve as nomads who have obtained employment with the
Oil Companies are showing a tendency to marry and settle
near the camps and large nunoers of Arabs, Persians and
Baluchis who are affected oy the rise m prices and the
practical cessation of the pearl trade are migrating from the
Trucial Coast A name used by Britain from the nineteenth century to 1971 to refer to the present-day United Arab Emirates. , Muscat and other places to the oil-fields.
8. in your paragraph 9 you discuss the possible reper
cussions in Iraq and owier countries of the greatly increased
rate of production and revenue in Kuwait which will ensue
if a new oil field is developed in the neutral Zone in addition
to the present one. it is difficult for me to asses the
nature and extent ox such repercussions which in any case are
not likely to be felt for some years for reasons already
stated. it would not, however, appear to be fair to either
Kuwait or Saudi Arabia to slow up the development of the
oil resources of une neutral Zone , if any exist, for fear
of exciting the jealousy of neighbouring countries.
9. With reference to paragraph 9 of your letter,
iroxitical Agent and myself have been and will be very careful
not to give any advice to the Shaikh which could be inter
preted by him as indicating that we expect him to favour one
or other of the competing companies.