Foreign Relations of the United States, 1952–1954, The Near and Middle East, Volume IX, Part 2

780.022/4–2354: Telegram

No. 1559
The Ambassador in the United Kingdom (Aldrich) to the Department of State¹

secret

London, April 23, 1954—6 p.m.

4695. In discussion Buraimi question at Foreign Office today, Embassy officer was asked whether Department’s suggestions to British Embassy (Deptel 5407²) meant that USG was requesting HMG both (a) modify wording paragraph c in light Aramco’s unwillingness surrender concessionary rights, and (b) suspend operations of British oil companies in disputed area. Foreign Office official pointed out USG had taken position British proposals on whole represented step forward and it would therefore be surprising if having done so, we should now ask British suspend oil operations when their continuance, as Foreign Office had repeatedly made clear, was essential part British proposals. Official confirmed statements made by British Embassy representatives to Department during April 13 conversation to effect continuation oil operations essential for political as well as commercial reasons. With reference to statement made during Hart’s April 14 call at Foreign Office to effect force would be used if necessary prevent Aramco entering territory, official explained this based on assumption any Aramco party would be accompanied by Saudi guards. He stressed entry of latter into area would be resisted as HMG must regard it as Abu Dhabi territory in absence some determination to contrary.

Embassy officer replied to question above by citing substance Deptel 5407 and Deptel 5459,³ i.e. (1) Department had suggested British reexamine paragraph c and consider withdrawing or modifying it substantially in order eliminate any possible misunderstanding, (2) Department believes suspension oil operations in disputed territory pending arbitration would be helpful, while failure take this step might well cause SAG request Aramco commence such operations, and (3) Department not inclined agree that British companies must continue operations while American company must not enter area. Embassy officer also stated (Deptel 5459) Department still disturbed at emphasis on British interest in obtaining concession in area and Department hoped British were not considering Saudi willingness, should such exist, to give away portions of American oil concession as justification for British acceptance since such Saudi attitude would obviously be motivated in part at least by expectation reaching more favorable territorial settlement. Officer added Ambassador Wadsworth authorized inform SAG we had suggested HMG reconsider paragraph c.

Foreign Office official remarked it possible Saudis might in fact be leading British into trap and also that Aramco might fear it may be forced by SAG give up part its concession. In circumstances, Embassy officer suggested one way around present difficulty might be as follows:

1. British (in view Aramco attitude) to eliminate from paragraph c all reference to interest of British companies in eventual concession, and make clear to SAG (a) previous reference based on false assumption and (b) in circumstances HMG has no interest in concessionary rights for British companies in area in question, if determined to be Saudi.

2. USG and HMG to reassure Aramco re British intentions and USG seek persuade Aramco and if necessary SAG that Aramco parties stay out of disputed area pending settlement of dispute.

Foregoing would of course involve continuance of operations by British companies.

Embassy officer made it clear he unable make any commitment re foregoing suggestion but would forward it to Department. Foreign Office official undertook consult his superiors on same basis.

It appears to Embassy that basic considerations in present situation are (1) British insistence on continuing their oil operations; (2) British determination use force against Saudis entering disputed area; and (3)Aramco’s fears based on suspicion SAG may give away part of Aramco concession to British. Latter fears, and desire make its interest in area more evident, seem to us principal causes for Aramco letters to British companies and for Aramco’s apparent intention send its parties into area. If these fears could be removed it seems to us there should be no great problem about continuance British oil operations since Foreign Office has repeatedly affirmed British have no intention disturbing Aramco’s rights and would immediately withdraw their companies should territory eventually be determined to be Saudi.

Foreign Office has not yet received Aramco memo (paragraph 2 Deptel 5407) which we understood was being forwarded through British Embassy.

IPC and AIOC replies to Aramco’s letter (Embtel 4562⁴) have not yet been sent but Foreign Office confirms they will be couched in terms outlined that telegram.

Foreign Office states there have been no new developments re direct negotiations between SAG and HMG but official pointed out if present plans for such negotiations are carried out there may not be any arbitration and therefore question of modification of paragraph c need not arise.

Aldrich

1. Repeated to Jidda and Dhahran.
2. Printed as telegram 288 to Jidda, Document 1557.
3. Dated Apr. 16, not printed. It informed the Embassy in London that the Department of State was disturbed at the apparent British tendency to emphasize the interest of British companies in obtaining concessions in territory that might be given to Saudi Arabia by arbitration. The Department hoped the British were not taking the position that possible Saudi willingness to give away any part of the U.S. oil concession constituted justification for the British to accept, especially since such Saudi willingness would obviously be motivated by the expectation of reaching a more favorable territorial settlement with the British. (780.022/4–1554)
4. Dated Apr. 15, not printed. It reported IPC and AIOC had received the Aramco letter and given it to the Foreign Office. The Foreign Office was disturbed at the tone of the letter, which an official described as “insulting,” and repeated that since their proposals specifically stated the British Government had no intention of prejudicing Aramco’s concessionary rights the Aramco letter was unnecessary. The Foreign Office official reiterated the British stand that Aramco would not be allowed into the area. (780.022/4–1554)