832.6363/7–3146: Telegram

The Ambassador in Brazil (Pawley) to the Secretary of State


1370. Your telegram 1023, July 30.

Drault–Ernanny will probably meet all conditions August 3 except final acquirement of refinery site. He is negotiating for Government owned land and has obtained approval of 6 Ministers and the President but must obtain approval of 5 other Ministers which cannot be done by August 3. Ernanny will probably ask further time extension on ground that his failure to acquire land is due to delay caused by Government. Under the law Council cannot grant final approval but can grant further delay.
It is believed Sampaio cannot meet conditions due to failure to acquire refinery site. Informed that during past 24 hours negotiations proceeding between Ernanny and Sampaio for joining of forces to build one 20,000 barrel refinery in Rio, using Ernanny site. If negotiations successful believed Sampaio will ask time extension to work out arrangement.
Reliably informed that Ernanny and Ipiranga are not together on São Paulo refinery. Ipiranga reported to have no further interest in São Paulo, but plans at proper time to proceed with 3,000 barrel refinery at Rio Grande.
Do not believe anything can be done until after August 3 when more is known about nature of proposal and council’s action. Anderson of New Jersey89 says he does not know where his company stands if Sampaio Ernanny deal materializes.
  1. Standard Oil Company of New Jersey.