890G.6363/394: Telegram

The Minister Resident in Iraq ( Wilson ) to the Secretary of State

109. Department’s 54, March 11. As desired by the Department I had another talk with Nuri yesterday and gave further emphasis to the reason for the American Government’s support of the American interests in the IPC as well as to the American point of view set forth in Department’s telegram under reference and in Department’s 47, February 12. Nuri has not been left unaware of the American point of view and in some respects sees eye to eye with it. Especially is this so in his desire to see the Basra Petroleum Company’s concession developed and its output placed on a basis which allows it to be competitive [Page 651] with the output of other areas in which Anglo-Iranian has a dominant interest. There appears to be some misconception of this in Department’s telegram 54. Another apparent misconception is Nuri’s opposition to the concession itself. I think this may be because the Department has not yet received my despatches 213 of March 3, 224 of March 9 and 226 of March 10.36 When these are received I think clearer understanding will result. Although Nuri holds to his own interpretation of force majeure he has agreed to settle present differences by friendly agreement and has no intention of invalidating the concession therein if consistency in his stand but I feel perfectly certain the Iraq Government does not want to invalidate this concession and very likely never did want to do so.

With regard to revision Nuri is determined in his stand that the present is not the time to undertake it. He is not against revision as such and when the war is over he states he will not be found unwilling to listen for revising the concession and the question of pooling as well. But at the present time he will not do so. And when revision is undertaken he expects to get greater advantages for Iraq than he has now.

Skliros as authorized negotiator for the oil groups had his first talk with Nuri a week ago yesterday and on March 9 submitted to Nuri his proposals which Nuri has turned over to the Council of Ministers where they are now being considered. I am uninformed of the terms proposed for this settlement save that it is by agreement and not arbitration; that a sum of money (amount unnamed to me) is offered to Iraq Government, compensation for loss of revenue from deferred development and some sort of “moratorium” asked which will extend for a period of 2 years after the last Axis power has signed the armistice. Other features of the proposals I know nothing about and feel it would be unwise for me to attempt at this stage of negotiations to ask for details.

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