890g.6363 T 84/43: Telegram

The Ambassador in Great Britain (Harvey) to the Secretary of State


339. In the matter of participation in the Turkish Petroleum Co., I am informed by Teagle,62 who is returning to the United States tomorrow, that no agreement has been reached. … Pineau, chief of the French Government’s petroleum department, and representing French interests, has unexpectedly displayed sympathy with [Page 340] the American view. Following a conversation which he had had with Poincaré,64 Pineau presented Teagle with a memorandum and asked that it be brought informally, to your attention. The memorandum reads as follows:65

  • “(1) The French Government are in accord with the American Government’s position as to the open-door policy which they understand to be just and equal treatment for the nationals of all countries. Their understanding being that reciprocity of treatment will be accorded to French nationals in all other areas, therefore if the American Government is in accord with this [then] the French Government are entirely willing that the American group should have an equal participation with them in the development of the petroleum resources in the areas covered by the San Remo agreement.
  • “(2) The French Government desires the modification of the San Remo agreement so that the application of the special sovereignty of the local government of Iraq under the British mandate shall be accorded to the local government of Syria under French mandate.”

Pineau stated also that the French Government’s views as set forth in the above memorandum had been communicated to the British Government. Paragraph (2) above is to be explained by the fact that from all oil produced under the agreement the Government of Iraq may collect a royalty. It is the desire of the French, therefore, that the Syrian Government shall have a similar privilege of levying a small transit tax on Mosul oil passing through Syria to Alexandretta by the proposed pipe line.

After private discussions between the present partners in Turkish Petroleum it was decided to offer the American interests a 12% participation. Naturally the offer appeared entirely too low to Mr. Teagle and there was a rupture of official negotiations.

. . . . . . . . . . . . . .

  1. W. C. Teagle, president of the Standard Oil Co. of New Jersey.
  2. Raymond Poincaré, French President of the Council and Minister of Foreign Affairs.
  3. The quotation which follows is not paraphrased.