Coll 30/216 'Development of oil supplies in the Middle East.' [‎21v] (42/131)

(ii) Mosul Petroleum Company, operating Concessions granted to British Oil
Development Company, Ltd.
40 The British Oil Development Company, Ltd., obtained a concession from
the Iraq Government in May 1932. for the areas west of the Tigris which the
I.P.C. had relinquished in the previous year; this area covers some 43.500 squat
miles. The B.O.D. company represented a combine of certain British h i ench.
Italian and German interests. Mosul Oilfields. Ltd., was formed m TSovembe®
1932 to acquire the shares of the B.O.D. Company. , . , t f
41. The Germans did some shallow drilling near Qayyara, during the last
war, obtaining some heavy, viscous oil. The B.O.D. Company prospected an
drilled in a number of areas, but although oil was struck at Qayyara, it was
viscous and had a hight sulphur content. The terms of the concession, which
included royalty at 4s. (gold) per ton, with a minimum annual payment ot
£200,000 (gold) (payable as “dead rent” until production s^ed) and the
obligation to construct and operate a pipe-line with a capacity of 1,000,000 tons
a year or the provision of alternative means of transport, proved so onerous that
the BOD Company in 1937 disposed of its concession to the LF.C. A new
company, the Mosul Petroleum Company, was formed to operate this concession
Until the outbreak of war, the company had not succeeded in prodiicing sufficient
quantities of oil to justify the construction of a pipe-line, although oil ot better
quality than the Qayyara crude had been struck at Am Zala 42 mi es
north-west of Mosul. Up to 1941 about 100 wells had been drilled al of which
except one, were plugged as part of the denial measures undertaken by the British
Military Authorities in 1941. ^ ^
42. In 1943, an agreement was signed by the Mosul Petroleum Company
and the Iraq Government, under which a moratorium was granted from Mav
1941 to a date two years after the end of the war between Great Britain and
Germany and Japan, whichever is the later, on all drilling and production
obligations.
(iii) Basrah Petroleum Company, Ltd.
43. This company, which was formed and is controlled by the
Petroleum Company, Ltd., has a capital of £1.000,000. On the 22nd July, 1938
it obtained from the Iraq Government a concession for 75 years giving i
the exclusive right to prospect for and exploit petroleum in all parts of Iraq over
which similar rights had not already been granted to the I.P.C., B.O.D. Co., and
the A.I.O.C. . ... i
44 The company was to start drilling operations within 3 years and
exporting of oil within vears from the date on which the concession was
granted ° Rovalty is at the'rate of 4s. (goldl per ton, with a guaranteed minimum
annual payment of £200,000 (to be paid as “dead rent” until production
of- Q ■pI'O )
45. The moratorium agreement of 1943 also waived the drilling and
production obligations of this company.
(iv) Khanaqin Oil Company, Ltd.
46 The Khanaqin Oil Co. was formed in 1925 in order to acquire from the
Anglo-Persian Oil Co. (as it was then called)( 2 ) the oil-bearing area known as Naft
Khaneh. The area in which this field is situated formerly belonged to Persia
and formed part of the D’Arcy concession, but it was allocated to Turkey, together
with a larger area north-east of Khanaqin, by the 1 urco-Persian Frontier
Commission in 1913^-14. The concessionary rights of the A.P.O.C. in these two
areas were recognised first by the Turkish Government and later by the Govern-
ment^of I™b capital of the Khanaqin Oil Co. is £1,000,000; all the shares so
far issued are held by the A.I.O.C. , . , f or w n
48. Production is from 3 high-pressure wells, and is at the rate ot 200,000
tons per annum. The potential output is much higher. The crude oil is pumped
from the field through a 25-mile pipe-line to a refinery at Alwand, 3 miles
S.E. of Khanaqin. The products are marketed throughout Iraq by the Kandain
Oil Co., another A.I.O.C. subsidiary. , . , ,
49. Oil has also been found at Chiah Surkh, m the northern area that was
transferred to Turkey, but the Khanaqin Oil Co., is not exploiting it at present.
( a ) The name was changed to Anglo-Iranian Oil Company in 1935.
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