Damascus reported, on February 14, that the agreement covering the concession of the Trans-Arabian Pipeline Company (TAPLINE) had been approved by the Syrian Cabinet early the previous week. President Shukri al-Kuwatly was said to have informed Minister Keeley that he was sanguine concerning Parliamentary ratification of the agreement and that such action was “a necessary first step in our desire for economic and political collaboration with the West” (telegram 59, 890D.6363/2–1449).[Page 110]
Various disagreements arose thereafter between the Syrian Government and TAPLINE and anti-TAPLINE student demonstrations erupted. The Syrian Government thereupon postponed consideration of the agreement by Parliament (telegram 114, March 8, 2 p. m., from Damascus, 890D.00/3–849).
The Syrian Government was overthrown on March 30 in a coup led by Colonel Husni Zaim; for relevant documentation, see pages 1630 ff. The Husni Government approved the TAPLINE agreement and it was ratified by Legislative Decree No. 74 on May 16 (telegram 284, May 17, 8 p.m., from Damascus, 890D.6363/5–1749).
An internal weekly summary report of the Department of State, entitled Current Economic Developments, noted that Syrian ratification of the TAPLINE agreement “removes the last major barrier to the building of the long pending Trans-Arabian pipeline. … The project is now due for completion sometime in 1950—about a year behind the original schedule. Approval of the transit agreement was delayed by the Syrians for many months partly in disapproval of the US position regarding Palestine. The matter was further complicated by the political coup in Syria during March....
“The recent approval by the inter-departmental Export Review Board of the first and second quarter steel exports for 1949 removed another impediment to construction of the pipeline. Export licenses had been suspended for almost a year because of disturbed conditions in the Middle East. When completed, the Tapline is to have a capacity of 300,000 to 450,000 barrels a day and will extend for almost 1,100 miles from Saudi Arabia to the Mediterranean port of Sidon in Lebanon.” (Page 6 of summary report 203, dated May 23, 1949. It was prepared by the Policy Information Committee of the Department and is found in the files of the Foreign Reporting Division of the Bureau of Economic Affairs, lot 70–D467.)
A second pipeline company, the Middle East Pipeline Company (MEPCO), entered into negotiations with the Syrian Government early in 1949. The pipeline was planned to extend from Abadan, Iran, to an Arab city on the Mediterranean, to move oil owned by the Anglo-Iranian Oil Company and the Kuwait Oil Company to be sold to the Standard Oil Company of New Jersey and the Socony-Vacuum Oil Company. The negotiations, like those involving TAPLINE, were not successful until the accession to power of Colonel Husni. Apparently it was early in June that the Syrian Government signed an agreement with MEPCO (telegram 2247, June 10, 6 p. m., from London, 890D.6383/6–1049).
A MEPCO official, on November 22, informed officers of the Department
that his company had postponed orders for “34–36 inch pipe” [Page 111]until the third quarter of
1951, a one-year delay, because of its inability to secure an
agreement with Iraq. The Department was informed that Prime Minister
Nuri “had assured MEPCO officials that Iraq would grant MEPCO
transit rights as soon as IPC
difficulties were out of the way. Unfortunately the Iraqi Government
did not wish to carry on negotiations with the IPC until the results of the
Anglo-Iranian concession contract negotiations in Iran were
completed. Since no progress toward breaking the AIOC-Iranian impasse was apparent,
MEPCO officials decided on the one year postponement.” The
Department was also informed that the terminal of the MEPCO pipeline
would be Tartous, in Syria, and that the pipeline would move
1,000,000,000 barrels of crude oil over a period of twenty years
(memorandum of conversation by Richard Funkhouser of the Office of
African and Near Eastern Affairs, 890.6363/11–2249). For
documentation on the agreement between the American companies and
the Anglo-Iranian Oil Company, see
Foreign Relations, 1946, volume VII,
pages 18 ff.
The “IPC difficulties” referred to in
the paragraph immediately above concerned the Iraqi desire to
renegotiate the oil concession agreement of the Iraq Petroleum
Company; for the Iraqi desire to initiate such renegotiations, see
airgram 241, August 23, 1948, from Baghdad,
ibid., 1948, volume V, Part 1, page