891.6363 Standard Oil/301

The Consul at Teheran (Gotlieb) to the Secretary of State

Almost two months and a half have elapsed since the Persian Parliament passed the draft concession of the North Persian oil project whereby the Persian Government was empowered to present same to American companies, but no definite decision has thus far been arrived at.

There was little doubt but that the draft as presented would have to undergo considerable modification before it could be accepted by either of the two American companies interested, the Standard Oil and the Sinclair Exploration Company.

The Sinclair has chosen to pursue negotiations direct with the Persian Government, through Mr. R. Soper, its Persian representative, who informs me that he presented to the Persian Council of Ministers, his Company’s counter-proposal in French several weeks ago and was assured that it would be immediately passed upon by the Government.

The conditions of the Government were placed before the Standard Oil Company by the Persian Minister at Washington and it is understood that the Company found the Government proposals unacceptable and presented a counter-proposal which was unsatisfactory.

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

… There appears to be a strong undercurrent in favor of obliging the American financial mission to administer Persian affairs on the basis of Persian revenues solely, and without recourse to foreign aid. It must be confessed that the partisans of this view have a strong case, as the revenues of Persia, if properly collected and administered would undoubtedly be sufficient to run the country. No further loans are, in their opinion, justified unless they are expressly devoted to productive purposes.

Respectfully submitted

Bernard Gotlieb