58. Memorandum of Conversation1

    • Talks between Secretary of State Rogers and British Foreign Secretary Sir Alec Douglas-Home—Libya—Part VII of VIII
    • United Kingdom
    • Sir Alec Douglas-Home, Secretary of State for Foreign and Commonwealth Affairs
    • Sir Denis Greenhill, Permanent Under Secretary
    • John A. N. Graham, Private Secretary
    • W. Robin Haydon, Head of News Department
    • Philip Adam, Foreign and Commonwealth Office
    • David Bendall, Foreign and Commonwealth Office
    • Ambassador Freeman (to US)
    • Charles Wiggins, American Department
    • Lord Carrington, Secretary of State for Defence
    • Sir Burke Trend, Secretary of the Cabinet
    • Donald J. D. Maitland, Chief Press Secretary
    • Sir James Dunnett, Ministry of Defence
    • Robert T. Armstrong, Private Secretary
    • Peter J. S. Moon, Private Secretary
    • Henry L. James, Press Secretary
    • United States
    • The Secretary
    • Ambassador Annenberg
    • Dr. Moynihan, Counselor to the President
    • Dr. Kissinger, Assistant to the President for National Security Affairs
    • Mr. Ronald Ziegler, Press Secretary
    • Mr. Martin J. Hillenbrand, Assistant Secretary for European Affairs
    • Mr. Helmut Sonnenfeldt, National Security Staff
    • Mr. William J. Galloway, Counselor of Embassy for Political Affairs

Turning to Libya, the Secretary asked whether the oil companies should be encouraged to make the best deal they can with the Libyan Government. Sir Alec responded that the British Government had told British companies they should be guided by their commercial judgement and that the Government would stand behind them as best they could.2 Ambassador Annenberg pointed out that the situation was made particularly difficult because Occidental had made an agreement on terms which the other companies regarded as unfavorable. He commented that Esso was prepared to settle with the 30 cent per barrel increase in price but had taken a position against retroactive payments. Sir Alec noted that if the Libyan Government were to succeed in forcing the oil companies to agree to its terms, there was a strong probability that other oil producing countries would follow the same policy. Ambassador Annenberg added that Nigeria had given notice that it would expect to be given similar terms.

  1. Source: National Archives, RG 59, Central Files 1970–73, POL UKUS. Secret; Exdis. It is Part VII of VIII; Parts I–VI and VIII are ibid. No drafting information appears on the memorandum. The memorandum was approved in S on October 7. The meeting took place at Chequers.
  2. According to telegram 159031 to London, September 26, British Ambassador Freeman informed Johnson on September 25 that Douglas-Home “has reached the conclusion that the companies are right to stand firm and they should not concede to Libyan demands.” He believed “the companies should maintain a united front in negotiations with the Libyans, and that not to do so would lead to a worldwide increase in posted prices.” Douglas-Home wanted the Department of State to encourage U.S. majors to “maintain a firm stand along with BP and Shell.” Johnson told Freeman that “the Libyans are aware we have very little leverage over them. Each company will of course have to make its own decision in light of its estimates of probable Libyan actions.” (Ibid., PET 6 LIBYA)