891.6363 Amiranian/7: Telegram

The Chargé in Iran ( Merriam ) to the Secretary of State

2. My No. 1, January 4, 9 a.m. Hart states that owing to misunderstanding of the Shah’s wishes on the part of his Ministers the oil exploration and development agreement has had to be modified with the effect of reducing the area and creating neutral zone with respect to operations of the Anglo-Iranian Oil Company. These alterations have now received the assent of both parties. As modified the 60-year concession covering 200,000 square miles includes Gorgan, most of Khorasan, northeast Kerman, all of Sistan and northern Mokran. Territory later will be reduced by approximately one-half through the elimination of all unproductive areas.

Hart expects the foregoing and the pipe-line agreements to be transmitted shortly to the Majlis for ratification.