891.6363 Standard Oil/45

The Chargé in Persia (Engert) to the Secretary of State

No. 763

Sir: Referring to the Legation’s telegram No. 71 of November 22nd, 10 [9] p.m., I have the honor to transmit herewith translation of the proceedings in the Persian Medjlis at its session yesterday afternoon,24 when the Prime Minister rushed through the bill granting to the Standard Oil Company a concession for fifty years for the exploitation of mineral oil in the provinces of Azerbaijan, Guilan, Asterabad, Mazanderan, and Khorassan in North Persia.

A translation of the Bill itself, based upon the Persian text furnished to the Legation by the Secretariat of the Parliament is also enclosed herewith. It appears that Article 3 as at first submitted by the Prime Minister mentioned the Persian Government’s share as a “minimum of ten per cent” of the gross receipts of the company. But when it was found that there was some doubt in the minds of some of the members of Parliament as to the sufficiency of this percentage, the wording was changed [to] “over ten per cent”, the intention being to raise the minimum share accruing to the Government to a figure higher than ten per cent, and which is to be determined later.

I have [etc.]

C. Van H. Engert
[Page 649]

Bill Passed by the Persian Mejliss, November 22, 1921, Granting Concession to the Standard Oil Company

—The Persian National Assembly approves of granting to the Standard Oil Company, an American concern, a concession for the exploitation of petroleum in the provinces of Azerbaijan, Guilan, Astrabad, Mazanderan, and Khorassan under the following terms:
—The duration of this concession to be fifty years.
—The Persian Government shall be entitled to over ten per cent of all petroleum and petroleum products obtained from the wells, before any expenses are deducted.
—Other terms of the concession, such as the cession of the Government’s portion—in case the Government deems that proper—, the manner of ascertaining by the Government of the earnings of the company, and the conditions under which this concession may be annulled, and other terms, shall be prepared by the Government and after agreement with the above Company shall be submitted to the Medjlis for approval.
—The Standard Oil Company shall have no right whatsoever to transfer this concession to any government or company or person. Also any participation of other capital must have the consent of the Persian National Assembly.
  1. Not printed.