The Commercial Counselor of the British Embassy (Broderick) to the Under Secretary of State (Olds)

My Dear Colonel Olds: I write to say that on receipt of your letter to me of October 6th, the Ambassador addressed enquiries to His Majesty’s Principal Secretary of State for Foreign Affairs [Page 170]and to His Majesty’s Minister in Mexico City regarding an order which appeared in the Diario Oficial of July 25th, 1927, indicating that a Mr. H. H. Hallatt had filed a request for permission to drill for oil on certain lands, the property of four United States citizens, near Puerto Mexico, State of Vera Cruz. Sir Esme Howard has now been informed by Secretary Sir Austen Chamberlain that the facts are as stated in your letter under reference, excepting that Mr. Hallatt’s application, who is acting in the matter for the United Petroleum Company, a Mexican Company organized by the Mexican Eagle and Corona Companies, was for the exploration of the lands in question, and not for a drilling permit. The abovementioned British principals, who have been interviewed in the matter by His Majesty’s Foreign Office, state that their action is in conformity with the procedure that has been agreed to by all members of the Association of Oil Producers in Mexico, and that the United States companies have themselves taken similar procedure in other parts of Mexico involving, so it is believed, other than United States owners. The foregoing agreement between members of the Association is understood to cover the bulk of possible oil bearing lands in Mexico.

The British principals furthermore state that in their opinion it is undoubtedly open to the owners to safeguard their rights by bringing suit of amparo if they wish to do so. As the United States Government are, however, understood to be averse from such a step, the British principals say they would be quite prepared to conform to any amendment of existing agreed procedure which may be adopted by the Association of Oil Producers as a whole.

In asking me to bring the foregoing information to your notice, Sir E. Howard desires me to express the hope that it may prove satisfactory to the United States Government, demonstrating as it does, the readiness of the Mexican Eagle Company to co-operate closely with the United States interests in this matter.

Sincerely yours,

J. Joyce Broderick