856d.6363/86
The Minister in the Netherlands (Phillips) to the Secretary of
State
The
Hague, April 25,
1921.
[Received May 11.]
No. 528
Sir: I have the honor to transmit herewith the
copy of a Note, based on the Department’s telegraphic Instruction No.
25, of April 22d last, which I have to-day addressed to the Minister for
Foreign Affairs, on the subject of the participation of American
interests in the Dutch colonial oil industry. At the same time, I am
transmitting herewith the copy of my informal communication to M. van
Karnebeek, dated April 19th [22d] last, on this
same subject.
The Department’s telegram No. 25, above referred to, invites my attention
to M. de Beaufort’s note to the Department of September 27, 192018 (transmitted
under cover of your despatch No. 97, of November 11, 1920),19 and to the Department’s
reply thereto of November 2, 1920,20 especially the eighth paragraph, which refers
[Page 539] to the intimation that the
Netherlands Government does not intend to give to the Royal Dutch
Petroleum Company a virtual monopoly of the exploitation of the
remaining petroleum fields in the Netherlands East Indies.
I think the Department will agree, in this connection, that the only
concession made by the Dutch Government was to the effect that a
monopoly in the future oil fields to be opened up by the Netherlands
Government had not been accorded to the Royal Dutch nor to the
Bataafsche company. M. van Karnebeek has repeatedly assured me to the
same effect, but, as the Department has itself several times stated, the
richness of the fields that may in the future be opened for exploitation
by the Dutch Government is extremely problematic as compared with the
known value of the Djambi territories. I cannot but feel, therefore,
that to discuss with the Dutch Government the possible exploitation of
these other oil fields would tend only to weaken our case as regards the
Djambi concession. In fact, when the Minister for Foreign Affairs, as he
has several times done, has attempted to shift the discussion to
American participation in these other fields that may possibly be opened
up later, I have taken the opportunity to call attention to the fact
that American oil experts are not disposed to attach great importance to
them.
I have [etc.]
[Enclosure 1]
The American Minister (Phillips) to the Netherland Minister for Foreign
Affairs (Van
Karnebeek)
The
Hague, April 22,
1921.
My Dear M. van Karnebeek: Referring to our
conversation this morning on the subject of the participation of
American capital in the oil development of the Indies, I am not sure
that I brought out sufficiently clearly that American scientists and
oil experts, who have a very intimate knowledge of the oil resources
of the Indies, agree that the Djambi fields do represent
substantially the oil wealth of the country.
In these conditions, I think it is not unnatural, therefore, for us
to feel that the contemplated agreement with the Bataafsche does in
fact, although perhaps not in theory, constitute a monopoly—a
setting aside, for the exclusive development by one company in which
foreign capital other than American is largely interested, of the
richest mining district known in the Netherlands East Indies. Under
these circumstances, I should not be surprised if my Government did
not attach any very great significance to the assurances that have
been given me from time to time that nothing in the proposed [Page 540] legislation contemplated
the prohibition of American capital from participation in the
development of the oil regions other than the Djambi fields.
You will not forget, I am sure, that the United States has in the
past been conspicuously friendly to Dutch oil interests, but there
is the possibility and even the probability that my Government may
find it impossible for the present situation to continue unless
American capital is received in the same spirit in the development
of Dutch mineral oils.
I am [etc.]
[Enclosure 2]
The American Minister (Phillips) to the Netherlands Minister for Foreign
Affairs (Van
Karnebeek)
The
Hague, April 25,
1921.
No. 153
Excellency: Referring to my Note No. 151,
of April 19th last,21 and to my informal
communication of April 22d, on the subject of the participation of
American capital in the development of oil in the Netherlands
Indies, I have the honor to inform Your Excellency that I have just
received a further telegraphic Instruction from the Secretary of
State advising me that in view of the wide publicity which the
matter of the Djambi concession is receiving in the United States,
the practically complete exclusion of American interests from the
Dutch oil industry would create an unfavorable impression and a
situation of general discouragement to prospective American
participants in other branches of Dutch industry.
In communicating the foregoing to Your Excellency, I avail myself
[etc.]
