893.6363/121: Telegram
The Minister in China (Johnson) to the Secretary of State
[Received February 25—3 p.m.]
39. 1. Jett W. [John O.] Wicks representing Benedum Trees Company of Pittsburg and Walter A. Jones has informed me in strict [Page 774] confidence that he presented to the Chinese Minister of Industry a proposal for the erection of an oil refinery in China. Proposal is in form of a partnership with the Chinese and gives to grantee access to future Chinese oil supplies as well as exclusive right to refine petroleum products in China or from crude oil imported from outside sources. Copy of draft proposal has been given to me by Ministry of Industry with the request that I ask you whether such a proposal is workable and would be approved by the United States Government. I am forwarding a copy of Minister of Industry’s letter and draft proposal by mail.61 I have acknowledged receipt stating that I can express no opinion until matter has been considered by the Department and instructions received.
2. I understand that if plan is carried out it may be necessary to force foreign oil companies now in field to cooperate with grantee through existing machinery of distribution. Proposal would appear to set up a state monopoly for the refining of oil and for the sale of refined oil products within China.
3. Department’s February 23, 3 p.m.61 to Shanghai has just been received but I shall await Department’s reply to this telegram before taking further steps.
4. Paraphrase to Peiping by mail.