The Minister in Colombia (Philip) to the Secretary of State
[Received November 2, 6.40 p.m.]
160. Referring to Department’s October 13, 10 p.m. and October 14, 6 p.m.36
The treaty situation as I view it after careful consideration is briefly as follows:
Our Government, having obtained the consent of the Colombia[n] Government to extensive alterations in the text of treaty of 1914, has refused action on that pact until Colombia shall agree to a second treaty to guarantee the ownership of non-metalliferous subsoil deposits to American holders of real property in Colombia; the [Page 754]Colombian Government is most anxious to see a settlement of the treaty of 1914 and wishes to meet the second requirement by our Government if that can be accomplished without incurring revolution as a result of such an effort upon the suspicions of an extraordinar[il]y sensitive population as well as upon those of its political opponents.
I am definitely assured that the President and a majority of the Cabinet as at present constituted are in favor of private ownership of subsoil rights to non-metalliferous deposits. However, I am authoritatively informed that a majority in Congress favors the contrary, or national ownership. The Chamber has completed its discussions of the petroleum law and is expected to vote and send it to Senate probably within a few days. The President, the Minister of Foreign Affairs, and others tell me they believe the law will be a very advantageous one for foreign interests. Two striking features it will embody are as follows: 1, the public oil lands will be acquired by contract and not by denomination [denunciation], and 2, owners of private lands who develop the subsoil deposits in their lands within twenty years after the legislation, will own such deposits in perpetuity; if such deposits are not developed within that time they will become the property of the nation. I beg an immediate consideration of the latter point by the Department with a view to early instructions [regarding] any change suggested, if such legislation is not in harmony with the Department’s desires or views, as it might be possible for me to bring about some modification in the Senate respecting it. The evident aim of the Colombian Congress is to enact legislation which will encourage capital and at the same time force prompt development of resources, thus preventing the holding up of these for development in the remote future.
The most uncertain element as regards the petroleum situation is the nature of the decision which will be handed down by the Supreme Court relative to the constitutionality of the Executive decree of June 20 last.36 If this opinion should favor nationalization, it seems to me the Department’s attitude regarding an agreement would be untenable; if the decision declares the decree unconstitutional, as is expected, such an agreement as required might probably be obtainable, though the sentiment of the country is against it especially as a condition upon the treaty of 1914. It is not known when the Supreme Court’s decision will be handed down, but presumably the proposed petroleum legislation will be equally applicable whether it is against or for nationalization.
During a recent talk with the President, he repeated that he believes the suggested agreement would be comparatively feasible if the [Page 755]treaty of 1914 were first ratified. But he is strongly in favor of an arrangement by means of an exchange of notes or declarations embodying an interpretation of the text of the treaty of 1846. This procedure he believes would be entirely binding and could be carried out now as it would not necessitate congressional action. The Minister for Foreign Affairs informed me that he received a cable from the Minister at Washington concerning proposed agreement but he did not enter into the details. …
The Colombian Government is in a very difficult position regarding the treaty negotiations with our Government and its embarrassment has been increased by the Roncador complication37 which has inflamed public opinion here against the United States.