812.6363/653: Telegram
The Chargé in Mexico (Summerlin) to the Acting Secretary of State
[Received March 21—4:08 a.m.]
79. Local press to-day published presidential decree signed 12th instant authorizing granting of 10 year concessions for developing oil lands on Mexican national territory, such as federal zones, banks and beds of rivers, streams, lakes and lagoons to Mexicans or companies organized under Mexican laws. Concessionaires to pay 100 pesos annual rental per kilometer or fraction of federal zone granted and a production tax of 5 per cent of 1st one thousand cubic meters of daily production, 10 per cent of 2d thousand, 15 per cent of 3d and 4th thousands and 20 percent of all over 5,000. If a concessionaire does not extract in any month 50 per cent of producing capacity of wells the Government may take the full tax based on producing capacity which is to be measured monthly by Government inspectors.
The decree reaffirms the dominium directum of the Mexican Nation over the subsoil and its products.