'Minutes memos despatches etc' [‎40v] (80/156)

(6.) Principal British Concessions.
(a.) Anglo-Persian Oil Company.
A concession for sixty years was granted to
Mr. W. K. d’Arcy, of London, in 1901, with exclusive
right to drill for, produce, pipe and carry away oil and
petroleum products throughout Persia, except Gilan.
Mazandaran, Khorasan, Azerbaijan, and Astarabad,
The concession provided for the allotment to the Persian
Government of 20,0001. fully paid shares in the Company
as well as for a payment of 20,0001. in cash. To carry
out the preliminary work of examination and toting a
company, known as the First Exploitation Company, was
formed in 1903.
The effective working of the company was limited to
1 square mile in the Maidan-i-Naphtun field, situated
in territory belonging to the Pakhtiari khans. The
First Exploitation Company made a separate agreement
with the khans whereby the latter received 3 per cent,
of the shares in any company formed to work oil in their
country, and to facilitate this arrangement a second
subsidiary company known as the Bakhtiari Oil Company
(Limited), was formed with a capital of400,00()L to work
the remainder of the oil-bearing lands in the Bakhtiari
country other than the square mile allotted to the First
Exploitation Company.
In 1909 the Anglo-Persian Oil Company (Limited)
was formed, and took over all shares in the First
Exploitation Company and the Bakhtiari Oil Company
which were not held in Persia. In addition to the
proceeds of their shares the Persian Government are
entitled to a royalty of 1G per cent, of the net yearly
profits of the company.
By an agreement with the company of the 20th May,
1914, His Majesty’s Government secured a controlling
interest in the Anglo-Persian Oil Company by the
investment of some 2,000,0001.
While the area of the company’s concession amounts
to some 500,000 square miles, oil has chiefly been worked
in quantity at Maidan-i-Naphtun, although it has been
also proved at Kasr-i-Shirin, and there are surface
indications at numerous other places. From Maidan-i-
Naphtun the oil is conveyed 150 miles by pipe line to a
refinery at Abadan in the territory controlled by the
Sheikh of Mohammerah, and agreements have been made
by the company with the Bakhtiari khans for the
policing of the field-works and upper section of the pipe
line, and with the Sheikh for the same work in con
nection with the refinery and the lower section of the line.
During the war the oil produced by the company from
this field has proved one of the chief sources of fuel for
the British navy.
It is essential, therefore, that any attempt by the
Persian Government to raise the question of this con
cession at the Conference should be firmly resisted by
His Majesty’s Government. The financial interest of the
Persian Government and the Bakhtiari tribes in the
prosperity of the Company, and the material benefits in
the form of regular employment, and medical attention
given to the population in the territories worked by the
Company, should, however, afford effective arguments in
support of such an attitude on the part of His Majesty’s
Government. It may be added that the principle objec-