McGhee Files: Lot 53 D 468: Petroleum

Memorandum of Conversation, by Mr. Richard Funkhouser of the Office of African and Near Eastern Affairs

confidential

Subject: IPC Developments

Participants: Mr. C. S. Brewster, Socony-Vacuum
Mr. Frank Canfield, Standard Oil Company of New Jersey
NEA—Assistant Secretary McGhee
ANE—Mr. Funkhouser

Mr. McGhee briefly summarized the Department’s position regarding the development of Iraq oil resources. He stressed Iraqi sources of dissatisfaction as discussed with Ambassador Crocker1 and Labor Department official Kaukonen2 during the Assistant Secretary’s visit in Iraq and as described in the position paper prepared by the Department for the Foreign Ministers Meeting in London.

The company representatives agreed that IPC was vulnerable to most of the charges described and expressed their desire to bring about as quick an improvement in the situation as they could. It was realized, of course, that the American partners only represented a minority interest in the company.

Mr. McGhee stated that the Department was endeavoring to urge the British and French Governments to intercede with the other companies participating in IPC.

Mr. Brewster stated that both American partners had confidence in the ability of the new Managing Director of I.P.C., Mr. Gibson. Mr. Gibson had been formerly in charge of AIOC operations in Iran and was therefore well qualified to spot many of IPC’s shortcomings.

Mr. Canfield expressed his view that the American partners should recommend that a group of employee relations experts from each of the partners in IPC visit the area and make an exhaustive study of methods by which the situation in Iraq could be improved. These top [Page 52]company employee relations experts would have had experience in other areas and would be able to see where IPC was deficient in its Iraq operations. Mr. McGhee fully supported this approach.

  1. Edward S. Crocker, 2d, Ambassador in Iraq.
  2. Jorma L. Kaukonen, Bureau of Labor Statistics.