812.6363/2442

The Under Secretary of State (Olds) to the British Ambassador (Howard)

My Dear Mr. Ambassador: I have received your letter of November 30, 1927, regarding a case to which the attention of your Government has been drawn where an American company which is a member of the Association of Producers of Petroleum in Mexico, is reported to have applied for concessions covering lands in Mexico owned by a British interest since a date prior to the Constitution of 1917. I note your reference to the analogy between that case and the Ingalsbee case which was the subject of my letter of October 6, 1927, to Sir John Broderick.

In compliance with your request I have been happy to make inquiry in the proper quarters, and it gives me pleasure to inform you that negotiations are in progress in New York and that there exists the best good will among the persons concerned, namely, Mr. R. D. Hutchinson, Manager of the Aguila Company and representative of the Mexican Estates Company in Mexico, and Mr. Frank Feuille, attorney in New York for the Richmond Petroleum Company, to settle the controversy.

It appears from the report which has been made to me in the matter, however, that the conference between Mr. Hutchinson and Mr. Feuille developed the fact that the case of the British-owned interests in Tonalapa is not on all fours with the case of the Ingalsbee [Page 174]property, since the Mexican Estates Company owns but a minority interest in the property in question, the majority interest of which is leased to a Mr. Yerby, from whom the Richmond Petroleum Company acquired its rights. In view of your representations, how-over, Messrs. Hutchinson and Feuille have, as indicated above, started negotiations looking to a reconciliation of the conflicting interests involved and I expect shortly to hear definitely from the Richmond Petroleum Company.

In this same connection you will be interested to know that the Ingalsbee matter has been arranged in this manner: Mr. Burton Wilson, a partner of Mr. Ingalsbee, has become a member of the Association of Producers of Petroleum in Mexico, and for himself and partners has entered into an agreement with the Aguila Company whereby, in case a concession is issued to the latter’s new subsidiary covering lands owned by them, such concession shall be held for the benefit of the American owners. I am informed that the intervention of the British Foreign Office in this matter is highly appreciated by all parties in interest.

I am [etc.]

Robert E. Olds