The Chargé in the Netherlands (Norweb) to the Secretary of State

No. 1427

Sir: I have the honor to acknowledge the receipt of the Department’s Instruction No. 524, of January 21, 1928,6 informing the Legation that the Netherland Legation in Washington has formally raised the question of reciprocity with respect to petroleum exploitation and that the Secretary of the Interior has suggested that an application be filed under the provisions of the General Leasing Law of February 25, 1920 in order that the Dutch position under our laws may be now passed upon.

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Although this would seem to be the procedure clearly indicated, there is reason to believe, from the Colonial Minister’s references to reciprocity when speaking in defense of the Koloniale Bill, that the Dutch Government will not be entirely satisfied with the course of action outlined by the Secretary of the Interior. The Department will recall that during the recent debate (see despatch No. 1419, of February 13, 1928).7 the Minister for Colonies declared in effect that should the American Government fail to extend complete reciprocity in oil matters, it was always possible for him to withhold his signature to the Bill. The Minister referred of course to the reciprocity provisions of the 1920 leasing act, but what I believe he had also in mind is to clear the record of the charges of lack of reciprocity which were made in the “President’s Message to Congress of May 16, 1921, on restrictions against American petroleum prospectors in certain foreign countries.”8 As these charges were made publicly and formally, it would not be unnatural if the Dutch Government should now desire to have them removed from the record by a formal statement from the American Government rather than to leave their vindication to the filing of an application for a permit by the Royal Dutch. I understand that conversations are now taking place between the Foreign Office and the Colonial Department with a view to determining the instructions to be sent to Mr. van Royen in presenting the Dutch viewpoint to the Department.

Without entering upon a discussion of the merits of the Dutch expectations, which seem to lose sight of the fact that at no time has any Dutch concern operating in the United States been denied reciprocal treatment, the Colonial Minister’s position unquestionably complicates the final satisfactory settlement of this long outstanding issue. While this development need not be taken too seriously, it is possible that until details of procedure satisfactory to both governments can be worked out, the Koloniale will not be permitted to take possession of the concessions granted them in the new law. However, with the very evident good will existing on both sides, it should not be difficult to come to an understanding satisfactory to both governments.

In connection with this general question of procedure the possibility should not be overlooked that the Royal Dutch, unless very anxious to obtain concessions to operate in our public lands, may delay for an indefinite period the filing of an application in the hope of embarrassing the Koloniale. It may be that the Secretary of the Interior anticipated this possibility when in closing his letter of November 9, 1927, to the Secretary of State,7 he expressed his [Page 381]willingness to consider the question of reciprocity without awaiting a formal application by a Dutch company.

I have [etc.]

R. Henry Norweb
  1. Not printed.
  2. Not printed.
  3. S. Doc. 11. 67th Cong., 1st sess.; for part of report dealing with Netherlands and Netherlands East Indies, see pp. 927.
  4. Not printed.