691.119/6–1948: Telegram

The Secretary of State to the Legation in Saudi Arabia

239. Following is US Dept of Commerce, Office of International Trade, press release issued June 19, 1948 under number OIT 187:

“Export licenses for 11,650 tons of heavy oil-line pipe have been granted to the Anglo-Iranian Oil Company, the Dept of Commerce announced today through its Office of International Trade.

This pipe will be used to construct a pipeline in Iran from the oil field at Agha Jari to the port of Bandar Maschur on the Persian Gulf. The new line will have a daily capacity of 100,000 barrels of crude oil. Of this amount, a minimum of 40,000 barrels has been contracted for delivery to the US, and a considerable additional quantity may also become available for US purchase.1

OIT officials emphasized that the construction of the line between Agha Jari and Bandar Maschur—a distance of only 48 miles represents the most efficient use of this quantity of pipe. The oil wells have already been drilled, and the necessary dock installations and storage facilities have already been constructed. The 11,650 tons of heavy pipe which constitutes the entire steel requirement of this pipeline has already been fabricated and is at dockside awaiting shipment. The construction of this line will make available more oil for the quantity of steel involved than any other pending project. The pipeline will be completed by June, 1949.

The decision on pending export license applications of the Trans-Arabian Pipeline Company, for 16,000 tons of heavy pipe in second [Page 23]quarter 1948 and for 52,000 tons in the third quarter, has been deferred until the first week in Sept when the next allocations will be determined. The length of the proposed Trans-Arabian pipeline is over 1100 miles, and construction could not be completed before early 1950. When completed, the Trans-Arabian line will provide a more efficient means of transportation from the oil fields to the Mediterranean than the present use of tankers.

OIT officials stated that the postponement of consideration of the Trans-Arabian Pipeline Company’s applications for oil-line pipe will not prejudice applications by the company for licenses to export material other than heavy pipe which may be required to continue construction on a reduced basis, using pipe on hand in the area.”

Sent Jidda as 239; rpted Cairo as 832; London as 2311; Tehran as 568; Damascus as 237; Beirut as 356.

  1. In a letter of June 28 to Assistant Secretary Thorp, Francis McIntyre, Assistant Director of the Office of International Trade in the Department of Commerce, stated that the 40,000 barrels had already been contracted to the Socony-Vacuum Oil Company and that negotiations were proceeding satisfactorily toward the commitment of a further 30,000 barrels to independent American refinery interests (691.119/6–2848).