891.6363 Amiranian/31

Memorandum by Mr. Raymond A. Hare of the Division of Near Eastern Affairs

Mr. B. H. Faulkner, Secretary-Treasurer of the Amiranian Oil Company and the Iranian Pipe-Line Company, called on April 14th to leave the attached synopses37 of agreements between these Companies and the Iranian Government. The Department had received the full texts several weeks previously from the Legation in Teheran. No mention was made of this, however, in thanking Mr. Faulkner for his courtesy.

It has been noted that the synopses give March 5th as the date of promulgation of both Agreements, whereas the Legation gave March 9th as the date of promulgation of the Amiranian Oil Company concession and March 10th of the Iranian Pipe-Line concession. Presumably the information furnished by the Legation is correct.

In commenting on the negotiation of the Amiranian concession, Mr. Faulkner remarked that the Russians had for a time evidently failed to appreciate the significance of what was transpiring and that, when they finally did so, by intercepting radio messages sent in commercial code, they had sought to bring pressure upon the Iranian Government to prevent conclusion of the Agreement. Apparently, however, this Russian intervention had had exactly the opposite effect intended inasmuch as the Shah, on hearing of it, was said to have been so furious that he gave orders to conclude the matter immediately. Mr. Faulkner observed that what had thus had the aspect of a serious complication actually proved to be a boon inasmuch as up until that time the issue of negotiations was somewhat in doubt.

When questioned as to whether the objection of the Russians was based on legal grounds or on some political consideration, Mr. Faulkner stated that he was not aware of the specific nature of the Russian argument but merely understood that they had asserted some alleged pre-emptive right.

Quite the opposite of the Russians, Mr. Faulkner said that the British were very pleased with the granting of the concession as was evidenced by the very assuring statements of Sir John Cadman38 in [Page 751] the course of his recent visit to this country. In this connection, Sir John had evidently stressed the following two points:

The fact that the new concession is modeled so closely upon the A. I. O. C. concession would indicate the Iranian Government has adopted a stable policy with regard to oil concessions. This is reassuring to the A. I. O. C.
With another company now entering on the scene, the A. I. O. C. will cease to be the single object of critical attacks and, as a consequence, it will not be in the position of constantly defending its every move.

By April 27 two exploration units will be ready to commence work as provided by the contract. These units will consist of two Company engineers and two natives, furnished with six-wheel Chevrolet cars. The number of exploring units will be increased to six within a year.

  1. Not printed.
  2. Chairman of the Anglo-Iranian Oil Company.