Coll 30/216 'Development of oil supplies in the Middle East.' [‎26r] (51/131)

124. The company’s geologists examined some very promising indications
of petroleum in the province of Astarabad and some less encouraging seepages
in the neighbourhood of Zahidan. As a result, the company intended for a time
to drill in Astarabad, but it subsequently decided to abandon the concession
because of the difficulty and expense of developing such a relatively remote area
and because the high cost of marketing any oil that might be found would
^probably h^ve rendered the enterprise uneconomic.
* 125. In the course of its operations the company spent f2,000,000.
(e) The Pipe-line Concession.
126. At the same time as the Amiranian Oil Company obtained its conces
sion, the Iranian Pipe-Line Company, which was formed by the same interests,
secured a 60-year concession from the Persian Government giving it the non
exclusive right to construct a main pipe-line to any part of Persia, together with
tributary lines to connect it with other lines in Persia or in neighbouring
countries (i.e., Afghanistan). The existing rights of other companies (that is the
A.I.O.C.) were to be respected. The company’s lines were authorised to carry
oil from wells in Persia and/or Afghanistan produced by the Amiranian or other
companies. This concession was surrendered in June, 1938, when the Amiranian
and Inland Exploration companies abandoned their concessions in, respectively,
Persia and Afghanistan.
(f) The Kavir Khurian Company.
127. Khostharia, having acquired certain of the rights conferred by a
farman which had been granted many years previously to a Persian known as the
Amin al-Ma‘adin, registered the Kavir Khurian Company in Tehran in 1925 in
order to exploit the oil deposits in the desert region (kavir) to the south of Semnan,
some 110 miles to the east of the capital. The fact that the company was
registered does not necessarily imply that it has any valid claim to concessionary
rights.
128. As soon as the A.I.O.C. heard of the registration of this company, it
protested to the Persian Government on the grounds that Semnan lay within
the area of the D’Arcy concession. The Government, however, maintained that
Semnan was in the province of Khurasan and that it was therefore not within
the A.I.O.C.’s concessionary area.
129. Although the company was established on a somewhat flimsy basis,
Khostharia, who was on its board, showed great activity on its behalf. He
persuaded the Russian Bank to furnish the bulk of the capital, and distributed
a number of shares in a judicious manner to certain influential Persians. At a
later date Khostharia offered a holding in the company to French and Italian
interests, with the result that the former sent a party of geologists to examine
the company’s area. It is believed that their report was unfavourable; on the
other hand, a leading Soviet geologist named Golubniatnikov is said to have
formed a different opinion.
130. Up to the present only two wells have been drilled, and commercial
production has not been obtained.
131. Shortly after the Allied entry into Persia in the autumn of 1941, the
question of this company was, it is believed, discussed by the Persian Govern
ment and the .Soviet Embassy; the former is said to have maintained that the
company’s title was not valid and that a new agreement would have to be
negotiated before the area could be exploited. When M. Kavtaradze, the Soviet
Deputy Commissar for Foreign Affairs, arrived in Tehran at the beginning of
September, 1944, the ostensible object for his visit was the study of the position
of the Kavir Khurian Company.
(g) The N.V. Algemeene Exploratie Maatschappij.
132. On the 11th August, 1939, the Persian Government granted the
N.V. Algemeene Exploratie Maatschappij, a Dutch concern connected with the
Royal Dutch-Shell group, an exploration concession, valid for two years, for
minerals (including petroleum) in western and north-western Persia. This area,
which covered some 32,000 square miles, was an elongated quadrilateral of
irregular shape running from near Tabriz in the north-west to a point south of
Kashan in the south-east. The length was 420 miles, and the average width was
80 miles. An extension of this concession up to April 1944 was later granted;
when this extension was on the point of expiring, the company started negotiations
for a further extension. No extension or renewal of this concession has yet been
granted, doubtless because of the decision of the Persian Government to shelve
such matters until after the war.