81. Editorial Note

Following the Irwin Mission, James Akins, Director of the Office of Fuels and Energy and head of the Oil Task Force’s Working Group, traveled to London in January 1971 in order to meet with oil industry and British representatives to brief them on the mission and to develop tactics. (Telegram 10695 to Tunis, January 21; National Archives, RG 59, Central Files 1970–73, PET 3 OPEC)

From January 23 to 25, 1971, Akins briefed representatives from the major and independent oil companies, as well as British officials, on the Irwin Mission. He informed executives from Esso, Mobil, Texaco, Gulf, Socal, Occidental, Bunker Hunt, and Continental on the morning of January 23 that the assurances Irwin had received from the Shah of Iran, King Faisal of Saudi Arabia, and the Emir of Kuwait constituted a new factor. He also stressed that OPEC-wide negotiations could only result in the most extreme demands, that is, price rises, 60 percent tax, 162/3 percent royalty, compulsory reinvestment, and retroactivity. Most oil executives accepted Akins’ views, except for Henry Moses, Head of Middle East Operations for Mobil Oil Corporation, who reported that the Iranians were already rethinking their assurance. The industry planned to present a proposal separately in Tehran and Tripoli, although there was disagreement over whether this constituted one negotiation in two places or separate negotiations on the same principles. (Telegram 599 from London, January 23; ibid.)

In a second meeting that day, the oil executives told Akins that negotiations could not be completed in Tehran prior to the February 3 [Page 204]scheduled OPEC meeting. They requested that the United States “use all influence possible” in OPEC capitals to persuade the moderates to give them more time. All but George Parkhurst, Vice President of Socal, thought that parallel negotiations in the Gulf and Libya would have to occur, and that a reasonable agreement in the Gulf might facilitate rather than hinder agreement in Libya. However, they were all united on the “vital point” of industry solidarity. (Telegram 605 from London, January 23; ibid.) Consequently, the industry set up two teams in London, composed of majors and independent companies, to draw up proposals. Another group was established in New York. Their goal was to have a single negotiating group, part of which would present proposals in Tehran, and part of which would present the same proposals in Tripoli. Counter-proposals would be negotiated either in Vienna or in separate but connected negotiations carried out in different locations. (Telegram 12135 to Tunis, January 23; ibid.) The specific proposals the companies would present are in telegram 12370 to London, January 24. (Ibid.)

In a meeting with the independent oil companies on January 24, Akins outlined the reasons for parallel or simultaneous, but essentially separate, negotiations in the Persian Gulf and Libya. Most of the independents were “unimpressed” with his argument (and that of the majors) that a reasonable accommodation in the Gulf might make it easier to reach an agreement in Libya. They informed Akins that they had entered into general agreement with the major oil companies in order “to save their skins” and they thought the majors, more dependent on the Gulf producers, might undercut the interests of the independents in Libya. They, too, did not trust Iran to live up to the Shah’s assurances. (Telegram 621 from London, January 25; ibid., POL 33 PERSIAN GULF)

According to Ambassador to the United Kingdom Walter Annenberg, Akins reiterated to British officials the main conclusions of the Irwin Mission, which he had also stressed to both majors and independents: production sharing agreements would stand even if full fledged OPEC-wide negotiations did not develop, assurances by Persian Gulf heads of state to Irwin had to be taken seriously “although no USG guarantee can be provided,” and Gulf negotiations would not mean loss of a unified front in Libya. (Telegram 654 from London, January 25; ibid.)