330. Memorandum From the Assistant Secretary of State for Near Eastern, South Asian, and African Affairs (Allen) to the Under Secretary of State (Hoover)1
- Soviet Bloc Bid to Construct a Refinery in Syria
Attached (Tab A)2 is a … message … recommending that the United States act to stop the awarding of a contract for the construction of an oil refinery in Syria to the Soviet bloc. [Name deleted] considers the matter of critical importance and believes that the United States should subsidize, if necessary, a Western bid.
Also attached (Tab B) is a staff study discussing the pertinent factors and suggesting: (1) that one of the major U.S. oil companies, perhaps Standard of New Jersey, which has already offered to construct a refinery, be urged to present to the Syrians a sufficiently attractive offer to obtain the contract or, (2) failing this, that the United States subsidize a Western company. This recommendation is concurred in by Mr. Kalijarvi.
We agree thoroughly with the desirability of blocking the Soviet Bloc effort and that the first step should be an approach to Jersey asking it to improve its present offer. However, we see considerable difficulties in the proposal to subsidize a Western offer. These include Congressional and public reactions if it becomes known, which is probable; the precedent established for other similar situations such as the harbor works at Alexandria, the proposed refinery in Jordan and the construction of the Hejaz railway; and the general reluctance in principle to subsidizing U.S. business in this manner.
- That you, or if you are unable to do so, NEA, telephone Mr. Page of Standard Oil again; and: (a) emphasize to him the importance of the Syrian refinery to American oil interests in the Near East; (b) urge that Standard send a high-ranking representative [Page 583] immediately to Damascus; (c) suggest that Standard be prepared to improve its existing offer.3
- That we take no steps at this time towards subsidizing a Western offer.4
- Source: Department of State, Central Files, 883.3932/7–1656. Secret. Drafted by Burdett and initialed by Allen and concurred in by Kalijarvi.↩
- Attached, but not printed.↩
- At this point on the source text, Hoover initialed his approval of the option that he telephone Howard Page of Standard Oil. No record of that conversation has been found.↩
- Hoover initialed his disapproval of this recommendation.↩
- Secret. Drafted by Shaw, Beckner, Dunn, and Boardman.↩
- None of the tabs are attached. According to a list at the end of the document, Tab A was the text of the law establishing the Petroleum Institute.↩
- Tab B was a summary of the specifications for the refinery.↩
- Tab C was a report on the bids received.↩
- Majd al-Din al-Jabri.↩
- The source text identifies Tab D as “Alleged relative position lowest bids submitted East and West”.↩
- Ente Nazionale Idrocarburi, an economic agency established by the Italian State, which was the sole lessee for exploration, extraction, and transportation of oil and gas in the Po Valley in Italy.↩