ملف ٣٨٧٧ لسنة ١٩١٢، الجزء ٣، "تركيا الآسيوية: الامتيازات النفطية" [و‎‎٢‎٤‎٢] (٣٧٢/٢٤٩)

iThis is u ie P roperty;of His Britann ic Majesty s Government.]
TURKEY.
CONFIDENTIAL.
[May 20.]
Section 4.
[22639]
No. 1.
Board of Trade to Foreign Office.—(Received May 20.)
(Secret.)
Sir, Board of Trade, May 20, 1914.
WITH reference to your letter of the 13th May transmitting copy of a letter to
the Admiralty with respect to the relations between the Anglo-Persian Oil Company
and the Turkish Petroleum Company, I am directed by the Board of Trade to state
that they have now been in communication on the subject with representatives of the
former company, and to offer the following observations for Sir E. Greys consideration.
The arrangement described in the Admiralty letter of the 6th May as a method of
providing the capital for the holding company which would represent the D’Arcy
interests in the Turkish Petroleum Company, appears to the Board to be in effect not
a loan to individuals, but a subscription by the Anglo-Persian Company for shares in
the Turkish Petroleum Company, and therefore to make His Majesty’s Government
in effect shareholders in that Company, but without full control over its operations.
However desirable such a participation (even though subject to the reservation
mentioned) may be from the standpoint of Admiralty policy, the Board have felt
compelled, in view of your letter above referred to, to assume that it is inadmissible.
The commercial reasons adduced by the representatives of the Anglo-Persian
Company in favour of the arrangement proposed are that the primary object of the
D’Arcy group in their efforts to secure control of the Mesopotamian concession was to
protect the Anglo-Persian Company’s main enterprise—a purpose fully recognised by
His Majesty’s Government; that although the arrangements as to Government
participation in that enterprise will, if carried through, place the company in a much
stronger position than formerly, such a measure of protection is still desirable ; and
that the formation of a holding company, entirely independent of the Anglo-Persian
Company (even if practicable) would not afford the desired protection, since the
shareholders therein could not be restrained from disposing of their shares to British
subjects who might enter into competition with the Anglo-Persian Company. There
appears to the Board to be considerable force in these arguments, and if it be necessary
to reject the arrangement outlined in the Admiralty letter above referred to, for giving
the Anglo-Persian Company control of the holding company and thereby of the Turkish
Petroleum Company, it becomes necessary to endeavour to secure that the holding
company shall at least be constituted by some group having a permanent interest in
the Anglo-Persian Company.
As a result of the discussions which have taken place with representatives of the
Anglo-Persian Company it has been suggested that the best solution would be for
the capital of the holding company to be advanced by the Burmah Oil Company
(which will be the sole holder, other than His Majesty’s Government, of ordinary
shares in the Anglo-Persian Company), and for the shares to be held by, or in trust for,
the Burmah Company. It is understood, however, that the Burmah Oil Company
would not be disposed to enter into such an arrangement unless they received from the
Anglo-Persian Company a guarantee against resultant loss, such guarantee to be
limited to the amount of capital subscribed by the Burmah Oil Company, which would
not exceed 100,000L It is further understood that there would be no difficulty in
securing that the Burmah Oil Company would remain permanently British.
The possibility from a financial point of view ol the proposed guarantee being
given by the Anglo-Persian Company is a matter for the decision of the Admiralty and
Treasury, but should they not be averse therefrom the Board are disposed to suggest,
for Sir E. Grey’s consideration, that the scheme now outlined is not open to the
objections taken to the original scheme in your letter to the Admiralty ot the 13th May. ^
It is true that under it His Majesty’s Government would have an indirect financial
interest m the Mesopotamian concession, but it would be very limited in scope and of a
negative character. His Majesty’s Government would have no^ voice or share in the
.working of the concession, and no participation in any profits arising therefrom.
[2136 u—F\