875.6363/49: Telegram
The Minister in Albania (Grant-Smith) to the Secretary of State
[Received February 22—5:45 p.m.]
17. Department’s no. 6, February 19, 6 p.m. The Albanian Government decline to communicate to competitors the proposals of the Anglo-Persian Oil Company, but the following data have been elicited in conversations with the Minister for Foreign Affairs, with Mr. Xhafer Ypi the Prime Minister, with foreign colleagues and with the representative of the Standard Oil Company; (1) The original proposals, which provided for the prospecting for all minerals, have been altered to confine prospecting to oil. (2) The concession would cover the entire country for two years, then 100,000 hectares for the succeeding three years for test drilling and after that 65 [omission?] for 75 years for exploitation, which would include all probable productive areas. The Standard Oil Company is asking for 35,000 hectares, the French for 5,000, and the Italians for 4,000. (3) The Legation has obtained no information relative to marketing. (4) The Government state that the concession involves no loan. (5) The only representative now here is Sheffield, of the Standard Oil Company of New York.
The agent of the Sinclair Company left in December, 1922, and up to the present has shown no intention to return. Only the guarantee of a considerable loan would enable this company to compete successfully with foreign companies and with the Standard, which has won the support of the Minister of Public Works and has, so I am informed, declined to pool issues with Sinclair.
The British proposals, after having been accepted by the Cabinet in 1921, were transmitted to the competent committee of the National Assembly, but were not reported to the House by mutual consent for fear, I believe, of their rejection owing to the opposition that their exclusive character had aroused. It is admitted by members of the Government that each new proposal has been submitted to the [Page 373] British company which has the right of preference where terms are equal. Now the Government declare that they feel obligated to bring the Anglo-Persian’s original proposals, together with the subsequent modifications, to a vote. The result will probably depend in large measure upon the amount of persuasion and pressure employed by the competitors. … The Prime Minister called today to say that he would endeavor to exclude any company which employed improper methods of persuasion; that the ratification of the British concession was not certain, that he found the Standard’s proposals the best that had been submitted and that he hoped Sheffield would remain until the final decision.
The French and Italians object strongly to the attempted establishment of any oil monopoly by Great Britain. The possible oil areas are large enough to satisfy the French, Italian, and Standard Oil Company proposals and still leave a larger area for the British than that sought by the American company but the former continue to insist on exclusive rights. The Italian Minister has been instructed vigorously to oppose this pretension, and the French Chargé has recently made a protest against the granting of exclusive rights.